Kelo v. City of New London is one of the most controversial decisions in U.S. Supreme Court history. The Kelo Court held that the Public Use Clause of the Fifth Amendment allows government to condemn private property and transfer it to other private parties for purposes of “economic development.” This Article considers the question of what might have happened if the Supreme Court decided Kelo v. City of New London in favor of the property owners. Such counterfactual analysis may seem frivolous. But it is, in fact, useful in understanding constitutional history. Any assessment of the impact of a legal decision depends on at least an implicit judgment as to the likely consequences of a ruling the other way. Analysis can be improved by making these implicit counterfactual assumptions clear and systematically considering their implications.

Part I briefly describes the Kelo case and its aftermath, focusing especially on the massive political backlash. That backlash led to numerous new reform laws. However, many of them turned out to be largely symbolic. Part II discusses the potential value of a counterfactual analysis of Kelo. It could help shed light on a longstanding debate over the effects of Supreme Court decisions on society. Some have argued that court decisions have little impact, mostly protecting only those rights that the political branches of government would protect of their own accord. Others contend that this pessimistic view underrates the potential effect of Supreme Court decisions.

Part III considers the possible legal effect of a ruling in favor of the property owners. Such a decision could have taken several potential forms. One possibility is that the Court could have adopted the view advocated by the four Kelo dissenters: that economic development condemnations are categorically forbidden by the Public Use Clause. This would have provided strong protection to property owners and significantly altered the legal landscape. On the other hand, the Court could easily have decided in favor of the property owners on one of two narrower grounds. Such a ruling would have led to much weaker protections for property owners.

Part IV weighs the potential political impact of a decision favoring the property owners. Such an outcome might have forestalled the massive political backlash that Kelo caused. Ironically, a narrow ruling in favor of the owners that did not significantly constrain future takings might have left the cause of property rights worse off than defeat did. On the other hand, a strong ruling categorically banning economic development takings would likely have done more for property rights than the backlash did, especially considering the uneven nature of the latter. Furthermore, political movements sometimes build on legal victories, as well as defeats, as happened in the case of the Civil Rights movement in the wake of Brown v. Board of Education. It is possible that property rights advocates could have similarly exploited a victory in Kelo.

The California Supreme Court ruled Thursday against redevelopment agencies, including San Diego’s, and said they cannot remain in business by paying the state a portion of their property tax receipts….

The court was dealing with two laws passed by the Legislature in June to help close the state budget deficit by tapping the redevelopment funds held by redevelopment agencies.

One, AB1X26, abolished the redevelopment agencies and set up a mechanism to shift the redevelopment taxes back to the cities, counties, schools and others.

The second, AB1x27, allowed the agencies to continue but required them to opt in but only by paying pay the state $1.7 billion from their tax revenues this year and about $400 million annually in the future or about 10 percent of their tax receipts….

The second law is unconstitutional, the court said, because the agencies do have a right under Proposition 22, passed last year, to retain local revenues.

“We largely uphold Assembly Bill 1X26 and invalidate Assembly BillX127,” the court said.

And so in an ironic twist of fate, the agencies won their argument that they can keep their money but lost their argument that they can continue to exist.

Although the bill abolishing the redevelopment agencies was adopted primarily for the purpose of alleviating the state’s dire fiscal problems, it also has the beneficial side effect of curtailing eminent domain abuse. As I explained in this post defending the new legislation before it passed, the redevelopment agencies routinely engaged in dubious takings that transferred property to favored interest groups and destroyed more value than they created.

The Institute for Justice – a leading libertarian public interest law firm specializing in eminent domain issues – addressed the property rights benefits of the ruling in this statement:

In a landmark victory for private property owners in the Golden State, the California Supreme Court today upheld a statute abolishing the nearly 400 redevelopment agencies across the state. The court also struck down a law that would have allowed these agencies to buy their way back into existence. The final outcome of the case is that, in 2012, California’s decades-long redevelopment nightmare will finally come to an end.

California redevelopment agencies have been some of the worst abusers of eminent domain for decades, violating the private property rights of tens of thousands of home, business, church and farm owners. The Institute for Justice has catalogued more than 200 abuses of eminent domain across California during the past ten years alone….

While the decision focused on specific provisions of the California Constitution, its practical effect represents a significant victory for California property owners. “Redevelopment in California has been a billion-dollar, state-subsidized boondoggle that has completely eroded private property rights through the abuse of eminent domain for private gain,” said Christina Walsh, the Institute’s director of activism and coalitions. “With the court’s decision, redevelopment has finally met its long-overdue end, and property owners who have been living in terror across the state can finally rest safe in what they’ve worked so hard to own.”

The ruling won’t necessarily end all eminent domain abuse in California. Other government bodies also sometimes engage in abusive takings, and it’s possible that the state legislature will give more condemnation authority to some of those agencies now that the redevelopment agencies are gone. Nevertheless, the abolition of those agencies is a major step forward for property rights in California, as well as for the state’s beleaguered taxpayers.

Proposed by a liberal Democratic governor and supported by a wide range of libertarian and conservative property rights advocates, the law upheld in this case is a good example of the kind of cross-ideological cooperation on property rights issues that we need to see more of.

I would add only that the sale of organs and medically necessary body parts (including bone marrow) can save many lives. I answered some of the standard objections to organ markets here and here.

In some ways, bone marrow markets are even more defensible than organ markets. Unlike transplanted organs, transplanted bone marrow grows back, and the donor avoids even the very modest long-term health risks that kidney donors undertake.

CONFLICT OF INTEREST WATCH: I have had the privilege of working with IJ on a number of other cases, but had no involvement in this one.

Federal courts have long recognized that the Takings Clause applies to intangible property, including shareholder rights. However, Greenberg and Starr must still overcome several other difficult hurdles. First, there can be no taking if the property owner agreed to give up his or her rights to the government voluntarily. In this case, the bailout was approved by AIG’s board. As I understand it, Starr claiming that the board exceeded its legal authority. If they lose that part of their argument, there can be no taking.

If the transfer of rights is held to be involuntary, Starr could easily win if it could show that the takeover destroyed 100% of the value of their rights, as the Court ruled in Lucas v. South Carolina Coastal Council. However, it seems to me unlikely that they can prove any such thing, since the stockholders shares were not completely taken away. Assuming there was no 100% loss of value, the case would be analyzed under the three-factor Penn Central test, which considers 1) the economic impact of the government action on property, 2) the extent to which the government action undermined “investment-backed expectations,” and 3) the character of the government action. Application of the Penn Central test is often imprecise and murky. The bottom line, however, is that the government usually wins, as I discuss in greater detail in this article. I’m no fan of Penn Central myself, both because it is vague and because it provides insufficient protection for property rights. But it seems unlikely that the Court will use this case as the vehicle for changing the test. There is, however, uncertainty about the application of the test to this case, since – as far as I know – federal courts have never applied the test to anything remotely resembling the AIG bailout.

Finally, if Starr proves that there was no voluntary transfer of rights and prevail under Penn Central, they will face one last major challenge: proving that they are entitled to a more than nominal amount of compensation. The standard rule is that a taking entitles the owner to “fair market value” compensation for the loss of their rights. But prior to the bailout, AIG was on the verge of bankruptcy. Therefore, any shareholder rights may have had little or no market value at that point. The rule is that the “fair market value” must be assessed as it existed prior to the taking. So courts will not take account of any additional value added by the bailout. However, I’m no expert on either AIG’s assets in particular or the valuation of stockholder rights more generally. So it’s possible that these rights had greater value than is apparent to me. Experts on corporate law and finance are welcome to weigh in on this point.

A state constitutional amendment to expand Virginia’s eminent domain laws is meeting local resistance, with the city of Alexandria agreeing to contribute as much as $5,000 for a lobbying firm to help fight the legislation.

The amendment, sponsored for the 2012 General Assembly session by Delegate Rob Bell, Albemarle Republican, attempts to change the Virginia Constitution by updating a law enacted in 2007 that says private property can be taken only when the public interest dominates the private gain, among other conditions.

“The goal is to put [the amendment] into the constitution so that it can’t be tinkered with,” Mr. Bell said….

The amendment passed with wide support during the 2011 General Assembly session, with help from Mr. Bell. It cleared the House by a vote of 83-15 and the Senate by a vote of 35-5.

But to amend the state constitution, the measure must pass again in the assembly before going to the public as a voter referendum on the 2012 ballot.

Despite the broad support, Mr. Bell said, amendment supporters are girding a fight.

“We are not taking anything for granted,” he said….

Mr. Bell said, the impetus was to protect property owners.

“The local governments were certainly opposed to the original statute and claimed it would bring along the end of the world,” he said. “Of course, it hasn’t.

When it comes to property rights, Virginia’s present constitution is one of the least protective in the country. Article I, Section 11 gives the state legislature virtually unconstrained authority to “define” what qualifies as a “public use” that justifies taking property by eminent domain. Essentially, the legislature can license the condemnation of property for virtually any reason it wants. Few if any other state constitutional rights are left so completely to the mercy of the very state officials they are supposed to protect us against. It would be as if the legislature had total discretion to determine what kind of speech can be censored or when police are authorized to search your home.

In the short term, it doesn’t matter much whether eminent domain in Virginia is constrained only by strong statutory restrictions or by a constitutional amendment. But in the long run, a constitutional amendment would be a vital safeguard against the gradual erosion of property rights. Effective post-Kelo reforms like that in enacted in Virginia are the product of an unusual upsurge in public attention focused on eminent domain issues. Most of the time, the vast majority of “rationally ignorant” voters pay little or no attention to the subject. Even in the immediate aftermath of Kelo, many states enacted ineffective laws in part because voter ignorance makes it difficult for the electorate to tell the difference between genuine reforms and those that only pretend to constrain economic development takings.

As Kelo recedes into the past, public attention will understandably focus on other matters, and influential interest groups can lobby state legislators to gradually roll back post-Kelo reforms. The public might not even notice what is happening, just as most of them were unaware of the prevalence of Kelo-style takings in many states before the Supreme Court focused a national spotlight on the issue in 2005. A state constitutional amendment can help forestall this kind of gradual erosion of property rights. Unlike some other state constitutions, the Virginia Constitution is relatively difficult to amend. Thus, it will be much harder to roll back a constitutional reform than a purely statutory one.

UPDATE: Richmond Times-Dispatch columnist A. Barton Hinkle has a good column about the proposed Virginia amendment here.

Arresting people for assaults, beatings and robberies doesn’t bring money back to police departments, but drug cases do in a couple of ways. First, police departments across the country compete for a pool of federal anti-drug grants. The more arrests and drug seizures a department can claim, the stronger its application for those grants.

“The availability of huge federal anti-drug grants incentivizes departments to pay for SWAT team armor and weapons, and leads our police officers to abandon real crime victims in our communities in favor of ratcheting up their drug arrest stats,” said former Los Angeles Deputy Chief of Police Stephen Downing. Downing is now a member of Law Enforcement Against Prohibition, an advocacy group of cops and prosecutors who are calling for an end to the drug war.

“When our cops are focused on executing large-scale, constitutionally questionable raids at the slightest hint that a small-time pot dealer is at work, real police work preventing and investigating crimes like robberies and rapes falls by the wayside,” Downing said.

And this problem is on the rise all over the country. Last year, police in New York City arrested around 50,000 people for marijuana possession. Pot has been decriminalized in New York since 1977, but displaying the drug in public is still a crime. So police officers stop people who look “suspicious,” frisk them, ask them to empty their pockets, then arrest them if they pull out a joint or a small amount of marijuana. They’re tricked into breaking the law. According to a report from Queens College sociologist Harry Levine, there were 33,775 such arrests from 1981 to 1995. Between 1996 and 2010 there were 536,322.

Several NYPD officers have alleged that in some precincts, police officers are asked to meet quotas for drug arrests. Former NYPD narcotics detective Stephen Anderson recently testified in court that it’s common for cops in the department to plant drugs on innocent people to meet those quotas — a practice for which Anderson himself was then on trial.

At the same time, there’s increasing evidence that the NYPD is paying less attention to violent crime. In an explosive Village Voice series last year, current and former NYPD officers told the publication that supervising officers encouraged them to either downgrade or not even bother to file reports for assault, robbery and even sexual assault.

Even when police officials don’t consciously prioritize drug crimes ahead of violent crimes, the vast expenditure of law enforcement resources on the former probably reduces the amount of police effort that can be devoted to the latter.

Later in the article, Balko notes that the War on Drugs also incentivizes police departments to shift resources away from violent crime because drug busts allow them to earn extra money through asset forfeiture, while solving violent crime usually does not:

The most perverse policy may be asset forfeiture. Under civil asset forfeiture, police can seize property from people merely suspected of drug crimes. So long as police can show even the slightest link of drug activity to a car, some cash, or even a home, they can seize it. In the majority of cases, most or all of the seized cash goes back to the police department. In some cases, the department has taken possession of cars as well, but generally non-cash property is auctioned off, with the proceeds then going back to the department. An innocent person who has property seized must go to court and prove his property was earned legitimately, even if he was never charged with a crime. The process of going to court can often be more expensive than the value of the property itself.

Asset forfeiture not only encourages police agencies to use resources and manpower on drug crimes at the expense of violent crimes, it also provides an incentive for police agencies to actually wait until drugs are on the streets before making a bust.

I wrote about the ways in asset forfeiture threaten constitutional property rights here.

Stevens’ critique of O’Connor is not entirely without merit. In Midkiff, O’Connor wrote a majority opinion concluding that pretty much any rationale for a taking qualifies as a public use so long as it is “rationally related to a conceivable public purpose.” In Kelo, O’Connor dismissed this as merely “errant language.” But as Ben Barros has shown, it was actually deliberately inserted in the Midkiff opinion (O’Connor refused to take it out even after Justice Lewis Powell warned her that it would license virtually unconstrained takings).

That said, Stevens is wrong to suggest that the Court’s only options were either to overrule Midkiff and Berman v. Parker, or uphold the Kelo takings. Justice O’Connor’s dissent draws a perfectly reasonable distinction beween takings that eliminate some preexisting harm (severe blight in Berman, a supposed oligopoly in the property market in Midkiff), versus those that just seek to create some future public benefit. In the former case, there may be less danger that a taking that transfers property to a private party is just a scheme to benefit the new owner, since the public objective can be achieved simply by terminating the previous harmful use of the land. Many state supreme courts have adopted a similar approach under their state constitutions, permitting private-to-private takings for the purpose of eliminating severe blight, but forbidding them in most other situations.

It is not unusual for the Supreme Court to significantly narrow the scope of a precedent without completely overruling it. For example, the Supreme Court’s recent decisions in the Guantanamo cases narrow but do not overrule World War II-era precedents such as Korematsu and Quirin, which apply broad deference to the executive on wartime military decisions. Stevens voted with the majority in all those cases. Justice Stevens himself is the author of the Court’s decision in Gonzales v. Raich, which severely undercut its previous decisions in Lopez and Morrison, but did not overrule them completely. Like Justice Clarence Thomas, I wish the Court had overruled Berman and Midkiff completely. But I can understand why Justice O’Connor (along with Scalia and Chief Justice Rehnquist), preferred a more cautious approach.

It’s also worth noting that Stevens’ Kelo opinion misinterprets precedent at least as much as O’Connor’s did. For example, Stevens claimed that his position was supported by “a century” of precedent. But, as I explained in this article (pp. 240-44), all but the two most recent of those cases did not involve the Public Use Clause of the Fifth Amendment. They addressed challenges to takings brought under the Due Process Clause of the Fourteenth Amendment. Stevens also draws a distinction between takings that are part of a redevelopment plan and stand-alone “one-to-one” takings, claiming that broad judicial deference to the government is particularly appropriate in the former scenario, because the planning process protects property owners against abusive condemnations. However, as I explain here (pp. 228-29), the California district course he cites as a paradigmatic example of a “one-to-one” taking actually involved a redevelopment plan. This last mistake is more than just a minor technical error. Getting it right might have helped Stevens and the other majority justices understand that nearly all economic development takings occur in the context of redevelopment plans, and that the existence of a plan provides little or no protection against the use of eminent domain for the benefit of private interests. Influential interest groups routinely use the planning process to their advantage, as the Pfizer Corporation did in Kelo itself. Recognizing this might not have changed Stevens’ mind; but only one of the five majority justices would have had switch his or her vote for the case to have gone the other way.

Justice Stevens’ retrospective on Kelo is an interesting counterpoint to those of Justice Scalia and Connecticut Supreme Court Justice Richard Palmer. He makes some reasonable criticisms of the dissenting justices’ treatment of precedent. Perhaps in the future he will be equally forthcoming about his own similar mistakes.

UPDATE: As commenter “Steve” points out, I was wrong to suggest in my article that the Court did not mention the Public Use Clause of the Fifth Amendment in the 1896 case of Fallbrook Irrigation Dist. v. Bradley. The Court did mention it, but only to point out that it did not apply to the states:

There is no specific prohibition in the federal constitution which acts upon the states in regard to their taking private property for any but a public use. The fifth amendment, which provides, among other things, that such property shall not be taken for public use without just compensation, applies only to the federal government, as has many times been decided.

I am sorry I made this mistake, and grateful to the commenter for pointing it out. But getting it right would have actually strengthened my point.

As I noted in the article linked in my original post, the late nineteenth and early 20th century Supreme Court did consider challenges to state takings under the Due Process Clause of the Fourteenth Amendment. But it did so under a much more deferential standard of review than in the rare cases where it recognized that the Fifth Amendment does apply because the taking in question was conducted by the federal government.

“It’s the most unpopular opinion I ever wrote, no doubt about it,” Justice Stevens said in an interview. He said he empathized with Ms. Kelo, “but the legal issue would have been exactly the same if it had been a gas station or a pool hall.” . . .

“I had people at a bridge game stop me and ask, ‘How could you have written that opinion? We thought you were a good judge, but we learned otherwise,’ ” he said. “But you can’t explain the whole law of eminent domain to your bridge opponents.”

He particularly criticized the logic of Justice Sandra Day O’Connor, who wrote the 1984 opinion supporting eminent domain in Hawaii and then turned around to write a passionate dissent in favor of Ms. Kelo. . . .

Justice Stevens suggested that Justice Scalia’s view on Kelo had hardened over the years. When the decision came down, “Clarence wrote an intellectually honest opinion,” Justice Stevens said, referring to a dissent by Justice Clarence Thomas. “He said you’ve got to go back and overrule this whole line of cases, which would be a fairly dramatic thing.”

But Justice Scalia “did not join the opinion that would have overruled that. Rather, he joined Sandra’s,” Justice Stevens said.

FWIW, I’ve never been convinced that the Kelo dissenters are correct as a matter of constitutional law. While I think the use of eminent domain by the city of New London was horrendous policy, and I fully support efforts to constrain such eminent domain abuse through legislation and state constitutional amendments, I am not convinced such actions are barred by the Fifth Amendment, as I explained here and here.

The Supreme Court’s 2005 decision in Kelo v. City of New London generated a record political backlash. Kelo upheld the condemnation of private property for transfer to other private owners in order to promote “economic development.” The case inspired widespread outrage. Polls show that over 80% of the public opposes economic development takings. As a result, 44 states have enacted eminent domain reform laws that restrict the condemnation of property for the benefit of private interests.

The most recent state to react to Kelo is Mississippi. On Tuesday, Mississippi voters adopted Measure 31 by a decisive 73% to 27% margin. The new law will make taking property for economic development unprofitable by forbidding most transfers of condemned land to a private party for 10 years after condemnation. The measure is a major victory for both property owners and the state’s economy.

The overwhelming support for the measure is consistent with results in previous referenda on post-Kelo reform initiatives. No anti-Kelo referendum initiative has ever been defeated except in cases where a ban on Kelo-style “economic development” takings was packaged with some other, much less popular measure (as in the case of California Proposition 98). By contrast, all twelve “clean” anti-Kelo measures have passed, usually by lopsided margins, though a few of them fail to provide genuinely effective protection for property owners. I discuss all the referendum measures enacted up until mid-2009 in this article (see also here for an analysis of a Texas referendum initiative that passed after the article came out).

For reasons I summarized in my last post on Measure 31, reforms adopted by means of citizen-initiated referenda generally provide stronger protection for property rights than those enacted by state legislatures.

UPDATE: I have fixed the incorrect link to the vote tabulation.

UPDATE #2: With 90% of precincts reporting, Measure 31 is winning by a 73-27 margin. That makes it virtually certain that it will not only pass, but do so overwhelmingly.

Measure 31 would effectively ban economic development takings by forbidding most condemnations that transfer land to private parties during the first ten years after condemnation. Economic development condemnations are often used by powerful interest groups to acquire land for themselves at the expense of the poor and politically weak. In Mississippi, recent condemnations have transferred land to big auto firms such as Nissan and Toyota. Mississippi Governor Haley Barbour and others claim that these takings are needed to promote economic growth. In reality, economic development condemnations often destroy far more economic value than they create, by wiping out homes, small businesses and schools.

Many of the post-Kelo reform laws enacted in other states fail to impose genuinely effective restrictions on economic development condemnations. Legislators have found various ways to produce bills that have major loopholes. The most common tactic is that of allowing economic development condemnations to continue under the guise of alleviating “blight.” Many states define “blight” so broadly that almost any neighborhood qualifies and is therefore subject to condemnation. Such unlikely areas as downtown Las Vegas and New York’s Times Square have been declared “blighted” for the purpose of justifying condemnations. The New York Court of Appeals recently upheld blight takings justified by a combination of virtually limitless definitions of blight and biased studies conducted by a firm with a severe conflict of interest. Fortunately, Measure 31 avoids this pitfall by forbidding blight takings except in cases where the land in question is severely dilapidated or poses a direct threat to public health and safety.

Politicians enact ineffective reform laws in part because it is difficult for voters to tell the difference between a real “anti-Kelo” bill and one just for show. A 2007 Saint Index survey found that only about 13% of Americans knew whether or not their state had passed an effective post-Kelo reform law. As I explain in this article, referendum initiatives like Measure 31 tend to be stronger than reforms adopted by state legislatures because many of them are drafted by activists rather than by politicians. Measure 31 was submitted by the Mississippi Farm Bureau Federation (small farmers are often victims of eminent domain in the state). The vast majority of post-Kelo referenda adopted by voters impose tough restrictions on takings.

Unlike state legislators, the property rights activists who wrote most of the citizen-initiated anti-Kelo ballot initiatives had no need to appease powerful pro-condemnation interest groups in order to improve their reelection chances.

Measure 31 isn’t perfect. It still leaves the door open to abusive takings in genuinely blighted areas, and possibly to dubious condemnations on behalf of common carriers and public utilities. But it’s still a huge improvement over the status quo in Mississippi, which includes both an extremely broad definition of blight and a statute authorizing large-scale economic development takings.

When the Rosenbaum case began in 2009, I wrote this post countering one of the most common arguments against legalized organ sales: the claim that it would “exploit” the poor. Here’s a summary (details of each point are in the original post):

The arrest of Brooklyn Rabbi Levy Izhak Rosenbaum for trying to broker the sale of a kidney has rekindled public debate over the possibility of legalizing organ markets. This is an issue I teach every year in my Property class. Each time, one of the most common objections raised is the claim that organ markets must be banned because they will lead to “exploitation” of the poor…..

There are several major problems with the argument: it is inconsistent with allowing poor people to engage in far riskier activities for pay; it doesn’t even begin to prove that preventing the “exploitation” is an important enough value to justify the deaths of thousands of people for lack of organs; and it overlooks the fact that poor organ donors are likely to benefit from organ markets. Finally, even if all these points are unpersuasive, the exploitation argument still can’t justify banning organ sales by the nonpoor as well.

I realize, of course, that for many people, the most important objection to organ markets is not exploitation of the poor but rather a visceral emotional hostility. It is difficult to argue against gut feelings of disgust. Almost by definition, they are hard to influence by rational argument. Still, I would ask those who feel this way to keep in mind two points:

First, many social and technological changes that are widely accepted today were once greeted with similar visceral hostility. Consider cases like equality for women and interracial marriage. Some leading critics of organ markets, such as medical ethicist Leon Kass, also once argued that in vitro fertilization should be banned, because they found it disgusting as well. Today, IVF is an almost universally accepted method for enabling therwise infertile people to have children. Even Kass has made his peace with it. That doesn’t prove that all negative visceral reactions are necessarily wrong. But it does suggest that we should be very careful about basing policy on them.

Second, even if you think that your visceral hostility to organ sales is well-founded, it is still necessary to ask whether satisfying it is worth the sacrifice of thousands of lives every year. Many otherwise distasteful practices may be defensible if they save innocent lives. To justify a ban on organ sales, it’s not enough to prove that such sales are somehow flawed or even immoral. Whatever values are promoted by a ban have to be weighty enough to justify condemning thousands to an early death.

Scalia predicted the court’s 2005 “Kelo” decision saying local governments can take take property from one owner to give to a developer will be reversed someday.

“I do not think that the Kelo opinion is long for this world,” Scalia said. “My court has, by my lights, made many mistakes of law during its distinguished two centuries of existence. But it has made very few mistakes of political judgment, of estimating how far … it could stretch beyond the text of the constitution without provoking overwhelming public criticism and resistance. Dred Scott [legalizing slavery [note: Dred Scott did not actually "legalize" slavery, which was already legal in many states; it prevented Congress from forbidding it in federal territories, though states were still permitted to ban it - IS]] was one mistake of that sort. Roe v Wade [legalizing abortion] was another … And Kelo, I think, was a third.”

I am somewhat less certain than Scalia that Kelo will be overruled. However, I still think there’s a good chance. If anything, the controversy generated by Kelo makes it more likely that the Court will rethink its highly permissive Public Use jurisprudence than if the Supreme Court had never taken the case. Before Kelo, most experts thought that the Fifth Amendment’s Public Use Clause was virtually a dead letter because two unanimous Supreme Court decisions had declared that almost any “public purpose” endorsed by the legislature counts as a public use. Kelo, however, was a close 5-4 decision that generated widespread controversy far beyond the small group of experts who normally follow takings decisions. Even many defenders of Kelo had to admit that the meaning of “public use” was now once again open to serious debate.

Kelo also got a hostile reception from many state courts, who repudiated it as a guide to the interpretation of their state constitutional public use clauses. More broadly, both legal elites and the general public have become more sympathetic to property rights over the last twenty to thirty years. This trend, especially if it continues, makes it more likely that Scalia’s prediction will turn out to be prescient.

During World War II, after Japan attacked the Aleutian Islands off Alaska’s coast, the United States forcibly evacuated the islands’ natives and quartered soldiers in private homes. That hitherto unremarked violation of the Third Amendment gives us a fresh perspective on what “Property” means in the U.S. Constitution. As a general legal matter, property includes not just real estate – land, fixtures attached thereto, and related rights – but also various kinds of personal property, ranging from tangibles such as books to intangibles such as causes of action. That knowledge would, if we interpreted the Constitution as we do other legal documents, tell us just about everything we need to know about the scope of constitutional property. Case law and commentary do not speak as plainly, however, raising troubling questions about what “Property” means each of the four times it appears in the Constitution. In particular, some authority suggests that the Takings Clause protects personal property less completely than it does real property. The unjust treatment of Aleutian natives during World War II shows the risk of giving constitutional property so peculiar and narrow a definition. This paper describes the troubling inconsistencies that afflict the law of constitutional property and invokes the Third Amendment, that oft-forgotten relic of the American Revolution, to argue for giving “Property” a plain, generous, and consistent meaning throughout Constitution.

The Third Amendment does allow forcible quartering of troops in private homes in wartime, but only “in a manner to be prescribed by law.” And as Tom points out, Congress never enacted any law allowing troops to take over the homes of the Aleutian natives. He also shows that the the Aleutian natives’ suffering went beyond quartering as such:

They were forcibly removed from their homes and interred in distant and unhealthy camps, an ordeal in which “[t]hey fell victim to an extraordinarily high death rate, losing many of the elders who sustained their culture.”Worried about Japanese invaders, and pursuing a burnt earth policy, the U.S. military completely destroyed some evacuated villages. Other empty villages, though left standing, “were pillaged and ransacked by American military personnel.” When about a year later they were finally returned to their homes, “All household effects and equipment the Aleuts had left behind were missing.”The occupying forces took more than just the market value of the destroyed property. As reported in Personal Justice Denied, the official report of the Commission on Wartime Relocation and Internment of Civilians, “Through the insult of massive looting and vandalism of their homes and places of worship by American military forces, the Aleuts lost invaluable tangible ties to their past. Houses can eventually be rebuilt and refurnished, but stolen family mementos, heirlooms and religious icons . . . cannot be recovered.” Quartering was thus not the only or worse thing that the Aleuts suffered at the hands of their government. [footnotes omitted]

As Tom points out, much of the above represents clear violations of the Takings Clause and other parts of the Constitution, in addition to the Third Amendment. Yet, unlike in the contemporary case of the internment of the Japanese-Americans, no one in government even considered the possibility that the Aleuts’ constitutional rights had been violated.

Even when the federal government belatedly gave the Aleuts partial compensation for their losses in the 1980s, officials never admitted that the Aleuts had suffered violations of their Third and Fifth Amendment rights. Ultimately, the surviving Aleuts had to settle for a long-delayed, relatively paltry, $12,000 in compensation. The failure of officials to even consider this obvious violation of the Constitution is, as Tom notes, extremely telling. It does not paint a flattering picture of our constitutional culture, especially when it comes to property rights. It’s worth noting that the era when these violations occurred was also the period when constitutional property rights were first demoted to their present second-class status (though it’s far from clear that the government would have acted differently had a similar situation arisen earlier).

Tom does an excellent job of tracing the implications of the Aleutian episode for Third Amendment jurisprudence, constitutional theory, and property rights. I don’t agree with all of his analysis. For example, I’m not convinced that this episode proves that constitutional protection for personal property is as important as that for real property. At least when it comes to violations by state and local governments, the latter is more likely to be endangered for reasons I discussed in Part I of this article. In this case, most of the harm inflicted on the Aleuts arose from the expropriation of their real property (their land and homes).

Despite a few such disagreements, I highly recommend Tom’s article to anyone interested in property rights, constitutional theory, and – of course – the much-maligned Third Amendment. After reading the sad tale of the Aleuts, you will never again take your Third Amendment rights for granted!

UPDATE: The original link to Tom Bell’s article did not work. I have now fixed the problem. Thanks to various readers for pointing it out.

When prominent, accomplished land use scholars discuss federalism why do they pay so little attention to the United States Constitution? However one views the desirability of any particular attempt by Congress to regulate land use, if Congress does not have the power to regulate then the rest of the discussion is moot. Yet, though extensive scholarly discussion has in recent months been committed to the problem of federalism in land use controls, scant attention has been paid to the powers enumerated in Article I….

For example, one of the most strenuously-asserted objections to the Religious Land Use and Institutionalized Persons Act (RLUIPA) is that it violates principles of federalism. Two very prominent scholars have argued that RLUIPA intrudes upon local control of land use without sufficient reason. I think these arguments fail, for reasons that I discuss in an article forthcoming in the Real Estate Law Journal. But the critics miss entirely a federalism argument that I believe is nearly-fatal to RLUIPA, namely that RLUIPA is not a permissible exercise of the Commerce Clause power.

RLUIPA does not regulate commerce. It regulates courts in their review of decisions by local governments, which concern land use. Specifically, it directs state and federal courts to subject to strict scrutiny review those land use decisions that substantially burden exercises of religion. And religious exercise is generally performed by claimants engaged in non-commercial activities. Under Morrison and Lopez, which to my knowledge remain good law, the Commerce Clause predicate for RLUIPA seems indefensible….

It’s strange. Federalism in land use law is a hot topic right now…. On several occasions recently I have found myself in a room full of land use scholars, all at least as intelligent and informed as I, who have provided sophisticated, detailed accounts of the local, state, and national interests involved in various land use problems but never stop to consider whether any of their proposals are constitutional. Am I missing something?

MacLeod’s critique has some force. Part of the problem is the nature of specialization in the legal academy. Most land use and property rights scholars are not also constitutional federalism scholars, and vice versa. Naturally, both groups tend to stay within their areas of expertise, which sometimes leads them to ignore relevant issues raised by the other group.

As one of the relatively few academics who does regularly write in both fields, I think that MacLeod’s criticism is a little overstated. Current Supreme Court Commerce Clause doctrine gives Congress virtually unlimited power to regulate “economic activity,” defined very broadly as anything that involves the “production, distribution, and consumption of commodities.” This is broad enough to encompass most, if not quite all, federal efforts at land use regulation. After all, land is a commodity, and land use regulations control its consumption (in the sense of using its resources) and distribution. State and local land use regulations preempted by federal legislation in most cases also qualify as “economic activity,” since they control the use and distribution of land.

I strongly disagree with the Court’s broad interpretation of the Commerce Clause. Perhaps land use scholars should pay more attention to such criticisms (I can always use the extra citations!). At the same time, academic advocates of broad federal power over land use regulations are probably right to assume that most of what they support would pass muster under current Supreme Court doctrine.

There is, however, a different federalism-related flaw in the reasoning of some left-liberal land use scholars. Many of them argue that federalism concerns should lead federal judges to abjure enforcing constitutional property rights against state and local governments. They claim that this kind of federal intervention is undesirable because it interferes with local autonomy and overrides the superior knowledge of local government officials. If this is true, it should count against federal legislative control over land use decisions as well. Yet most of these same critics favor largely unconstrained congressional power to override local land use law.

Conservatives and some libertarians have a similar tension in their thought. If, as we claim, federal power should be strictly limited in order to preserve local diversity, why should federal courts be able to override local land use policies in order to protect property rights? I addressed that potential contradiction in this article.

As readers of this blog doubtless know, both conservatives and libertarians are split on the degree to which courts should act aggressively in reviewing legislation for constitutionality, as opposed to deferring to legislative action, especially in the area of so-called “substantive due process.” My sense is that different bloggers on this blog themselves disagree on this subject; and I suspect that I wouldn’t always agree with IJ’s broadest positions on this. But I much look forward to Clark’s explanation of IJ’s views, and I think our readers will find them interesting as well.

Mississippi is one of only a handful of states that have not enacted any eminent domain reforms at all since the Supreme Court’s controversial 2005 decision in Kelo v. City of New London, which ruled that the Constitution allows government to forcibly transfer private property to other private entities for purposes of “economic development.” Forty-three other states have enacted new laws, though many of them are likely to be ineffective.

Mississippi has a considerable history of dubious takings. Republican Governor Haley Barbour is a prominent advocate of massive condemnations that transfer property to big business interests such as auto manufacturers. In 2009, he vetoed a legislative eminent domain reform billIn this article, I explained why the kinds of economic development takings Barbour supports generally create more economic harm than benefit.

Although Measure 31 is not perfect, it would be a major improvement over current Mississippi law, which allows a wide range of economic development takings for big development projects, and also defines “blight” so broadly that virtually any area can be declared blighted and condemned. The initiative precludes economic development takings almost entirely by forbidding the transfer of condemned property to private interests for at least 10 years after the taking. It does create an exemption to this rule for property that is unfit for human habitation or poses a “direct threat” to public health or safety. But that is much more restrictive than the state’s current blight law. Broad definitions of blight that license abusive takings are a serious problem in many other states, including New York.

I will have more to say about Measure 31 at my presentation, and probably in a follow-up post that I will write after the talk for readers interested in the issue who are unable to attend.

I discuss this period in greater detail in my recent testimony on the civil rights implications of eminent domain abuse before the US Commission on Civil Rights. As I point out there, today’s abuses are not on as large a scale as those of fifty years ago. But it is still common for “blight” condemnations to be used against the minority poor and other politically weak groups in order to transfer their land to politically powerful groups. And nowhere more so than in New York City, the focus of the Reason video. The recent Columbia University and Atlantic Yards cases are particularly egregious examples, which I described in this article.

Urban renewal and blight takings are also a good example of how, contrary to stereotype, protecting property rights often benefits the poor more than the wealthy. Indeed, government is far more likely to threaten the rights of the former, because they usually have less political influence with which to protect themselves.

Each panelist will focus on one important upcoming case within his area of expertise. I plan to talk about Sackett v. EPA, an important property rights case. The other two panelists will focus on United States v. Jones, a Fourth Amendment case, and Douglas v. Independent Living Center, an important preemption/health care case. We will also, of course, take questions about other issues that the Court is likely to address.

I am grateful for the opportunity to address the important issue of the impact of eminent domain on racial and ethnic minorities. I would like to thank Chairman Castro, Vice Chair Thernstrom, and the other commissioners for their interest in this vital question. As President Barack Obama aptly put it, “[o]ur Constitution places the ownership of private property at the very heart of our system of liberty.” The protection of property rights was one of the main purposes for which the Constitution was originally adopted. Unfortunately, the Supreme Court has often relegated property rights to second class status, giving them far less protection than that accorded to other constitutional rights. And state and local governments have often violated those rights when it seemed politically advantageous to do so.

Americans of all racial and ethnic backgrounds have suffered from government violations of constitutional property rights. But minority groups have often been disproportionately victimized, sometimes out of racial prejudice and at other times because of their relative political weakness. Minorities are especially likely to be victimized by private to private condemnations that test the limits of the Public Use Clause of the Fifth Amendment, which requires that property can only be condemned for a “public use.” These include takings allegedly justified by the need to alleviate “blight” and promote “economic development.”

Part I of my testimony briefly surveys the constitutional law of eminent domain and public use. It documents the extent to which the Supreme Court has given condemning authorities a near-blank check to take property for whatever purposes they want.

Part II examines the impact of blight and economic development condemnations on minority groups. Both types of takings often victimize racial and ethnic minorities. Although such condemnations are defended on the grounds that they are needed to promote economic growth in poor communities, they often destroy far more wealth than they create. Economic development can be better promoted by other, less destructive means. African-Americans and Hispanics are targeted more often than other groups in large part because of their relative political weakness and comparatively high poverty rates. While, certainly, not all members of these groups are poor or politically weak, a disproportionately large number are.

Finally, in Part III I explain why the problem of abusive takings persists despite the wave of state reform laws adopted in response to the Supreme Court’s unpopular decision upholding economic development takings in Kelo v. City of New London. Many of the new laws actually impose little or no constraint on economic development takings. Even those that do impose meaningful restrictions usually still allow private-to-private condemnations in the types of “blighted” areas where many poor minorities live. Although post-Kelo reforms are a step in the right direction, much remains to be done before the property rights of poor minorities are anywhere close to fully protected.

UPDATE: Various commenters ask why this should be considered a “civil rights” issue and why it should matter whether there is a disproportionate impact on minorities. My answer is that property rights are in fact a major part of the “civil rights” that the framers and ratifiers of the Fourteenth Amendment sought to protect. And they particularly wanted to ensure their protection for African-Americans, whose property rights were at the time threatened by southern state governments. The disproportionate impact on minorities also matters because it is in part the result of past and (to a lesser extent) present racism, as is also the political weakness that makes it easier for even unbiased local governments to target the poor minority neighborhoods. It is not my view that the disproportionate impact on minorities is the only or even the most important aspect of this issue. But it’s certainly worth considering, and well within the mandate of the Commission on Civil Rights.

If a state Supreme Court judge approaches a journalist at a private dinner and says something newsworthy about an important decision, is the journalist free to publish the statement?

I faced that situation at a dinner honoring the Connecticut Supreme Court at the New Haven Lawn Club on May 11, 2010. That night I had delivered the keynote address on the U.S. Supreme Court’s infamous 5-4 decision in Kelo v. New London. Susette Kelo was in the audience and I used the occasion to tell her personal story, as documented in my book “Little Pink House.”

Afterward, Susette and I were talking in a small circle of people when we were approached by Justice Richard N. Palmer. Tall and imposing, he is one of the four justices who voted with the 4-3 majority against Susette and her neighbors. Facing me, he said: “Had I known all of what you just told us, I would have voted differently.”

I was speechless. So was Susette. One more vote in her favor by the Connecticut Supreme Court would have changed history. The case probably would not have advanced to the U.S. Supreme Court, and Susette and her neighbors might still be in their homes.

Then Justice Palmer turned to Susette, took her hand and offered a heartfelt apology. Tears trickled down her red cheeks. It was the first time in the 12-year saga that anyone had uttered the words “I’m sorry.”

It was all she could do to whisper the words: “Thank you.”

Then Justice Palmer let go of her hand and walked off.

Justice Palmer’s statement is yet another indication that, at least at the state level, many judges have become more skeptical about economic development takings since Kelo was decided by the Connecticut Supreme Court in 2004 and the US Supreme Court in 2005. I document that skepticism more systematically in this article on the judicial reaction to Kelo.

In a later interview with Benedict, Justice Palmer partially retracted his apology:

Justice Palmer sent me a “personal and confidential” letter dated Nov. 8, 2010. In it he didn’t dispute my account. Nor did he ask me not to publish. Rather, he provided some important context.

“Those comments,” he wrote, “were predicated on certain facts that we did not know (and could not have known) at the time of our decision and of which I was not fully aware until your talk — namely, that the city’s development plan had never materialized and, as a result, years later, the land at issue remains barren and wholly undeveloped.” He later added that he could not know of those facts “because they were not yet in existence….”

Q: Looking back at the Kelo decision (by the Connecticut Supreme Court), how do you see it now? In other words, has it led to good law?

A: I think that our court ultimately made the right decision insofar as it followed governing U.S. Supreme Court precedent. Whether the Kelo case has led to good statutory law is not a question for me or my court; so long as that law is constitutional, its merits are beyond the scope of our authority. Of course, judges are also citizens and, therefore, we may hold a view on the merits, but that view should not interfere with or affect our legal judgment concerning the law’s constitutionality.

Justice Palmer lets himself off the hook too easily. It is true that the justices could not have known for certain that the Kelo condemnations would fail to produce the economic development that supposedly justified the use of eminent domain in the first place. But they could and should have known that such results have often occurred in similar cases, that the New London development plan justifying these particular condemnations was flimsy, and that there was no legal requirement compelling either the city of New London or the new private owners of the condemned property to produce enough development to offset the destruction caused by the takings. Some of these points were in fact noted in Justice Zarella’s dissenting opinion in the Connecticut Supreme Court. As he put it:

In my view, the development plan as a whole cannot be considered apart from the condemnations because the constitutionality of condemnations undertaken for the purpose of private economic development depends not only on the professed goals of the development plan, but also on the prospect of their achievement. Accordingly, the taking party must assume the burden of proving, by clear and convincing evidence, that the anticipated public benefit will be realized. The determination of whether the taking party has met this burden of proof involves an independent evaluation of the evidence by the court, with no deference granted to the local legislative authority. In the present case, the evidence fails to establish that the foregoing burden has been met….

The record contains scant evidence to suggest that the predicted public benefit will be realized with any reasonable certainty. To the contrary, the evidence establishes that, at the time of the takings, there was no signed agreement to develop the properties, the economic climate was poor and the development plan contained no conditions pertaining to future development agreements that would ensure achievement of the intended public benefit if development were to occur.

The evidence Justice Zarella relied on was also available to the majority justices. In fact, the latter did not dispute that evidence, but concluded that most of it was irrelevant to the question of whether the taking really promoted a “public use,” as required by the state and federal constitutions. They held that courts should not consider the actual economic costs and benefits of takings. This despite the logical point that even if “economic development” qualifies as a public use, it surely cannot justify a taking that doesn’t actually produce any economic development or is not likely to do so.

Justice Palmer is right that previous US Supreme Court precedent probably justified the takings under the federal constitution. Only the federal Supreme Court could reverse or narrow those earlier decisions. However, the Connecticut Supreme Court was applying not only the federal Public Use Clause but also that of the Connecticut state constitution. The latter is not controlled by federal Supreme Court precedent. Indeed, long before Kelo, many state supreme courts interpreted their state public use clauses more restrictively than the federal Supreme Court interpreted the Public Use Clause of the Fifth Amendment. The Connecticut Supreme Court could and should have done the same thing in Kelo.

UPDATE: It is not entirely clear whether Justice Palmer now believes that the court was justified in upholding the taking under the Connecticut state Public Use Clause. His statement that he and the other majority justices “made the right decision insofar as [they] followed governing U.S. Supreme Court precedent” could be interpreted to mean that they were wrong on those aspects of the case that were not governed by US Supreme Court precedent, including the question of whether the New London takings were justifiable under the Connecticut Constitution.

UPDATE: Timothy Sandefur notes that the really important question is who will play the amici. Also, who is going to play the authors of amicus briefs cited by the Court, such as this one? We all know that these characters should be the real heroes of the story! I’m holding out for Brad Pitt to play me.

Lawyers and social scientists often describe property as a “bundle of rights.” What are the connotations of “bundle”? What features of property does the “bundle” talk obscure or even deny? What are its political consequences?

In the past 15 years, the “bundle of rights” view has been provocatively challenged, notably by James E. Penner, Thomas W. Merrill, and Henry E. Smith. This symposium brings the challenge to the fore, as these leading critics elaborate the core points of contention. They are joined by three younger critics of the “bundle” view, each with a fresh perspective.

Two eminent legal scholars, Richard A. Epstein and Stephen R. Munzer, take up the challenge. Each mounts his own defense of “bundle of rights” theory. Another renowned property scholar, Robert C. Ellickson, weighs in and stakes out a middle ground.

I am generally a fan of the “bundle of sticks” view, and the symposium essays by Epstein and and Munzer articulate some of the reasons why. However, the opposite perspective also makes some good points, and is well-represented in the symposium by Merrill, Smith, and others.

I highly recommend this exchange to property scholars and anyone else interested in the subject.

The New York Court of Appeals’ two recent blight condemnation decisions are the most widely publicized and controversial property rights rulings since the Supreme Court decided Kelo v. City of New London. In Kaur v. New York State Urban Development Corp., and Goldstein v. New York State Urban Development Corp., the Court of Appeals set new lows in allowing extremely dubious “blight” condemnations. This Article argues that the New York Court of Appeals erred badly by allowing highly abusive blight condemnations and defining pretextual takings so narrowly as to essentially read the concept out of existence.

Part I briefly describes the background of the two cases. Goldstein arose as a result of an effort by influential developer Bruce Ratner to acquire land in Brooklyn for his Atlantic Yards development project, which includes a stadium for the New Jersey Nets basketball franchise and mostly market rate and high-income housing. Kaur resulted from Columbia University’s attempts to expand into the Manhattanville neighborhood of West Harlem. When some of the landowners refused to sell, Ratner and the University successfully lobbied the government to declare the land they sought to be blighted and use eminent domain to transfer it to them.

Part II addresses the issue of blight condemnation. Goldstein and Kaur both applied an extraordinarily broad definition of “blight” that included any area where there is “economic underdevelopment” or “stagnation.” In addition, the court opened the door for future abuses in three other, more novel, respects. First, it chose to uphold the condemnations despite evidence suggesting that the studies the government relied on to prove the presence of “blight” were deliberately rigged to produce a predetermined result. Second, it dismissed as unimportant the fact that the firm which conducted the blight studies had previously been on the payroll of the private parties that stood to benefit from the blight condemnations. Finally, the court refused to give any weight to extensive evidence indicating that Ratner and Columbia had themselves created or allowed to develop most of the “blight” used to justify the condemnations. The court’s approach opens the door to future abusive condemnations and violates the text and original meaning of the New York State Constitution.

Part III discusses Goldstein and Kaur’s treatment of the federal constitutional standard for “pretextual” takings. In Kelo and earlier decisions, federal courts made clear that “pretextual” takings remain unconstitutional despite the Supreme Court’s otherwise highly deferential posture on “public use.” Unfortunately, the Supreme Court has been extremely unclear as to what constitutes a pretextual taking. As a result, courts have taken widely differing approaches to the issue. Nevertheless, Kaur and Goldstein are outliers in this area, deferring to the government more than almost any other court that has addressed the question since Kelo. They virtually read the concept of pretext out of existence.

In Texas and many other states, public utilities and other “common carriers” have the power to use eminent domain to acquire land for their operations. In this case, however, Denbury, an oil company, sought to use eminent domain for a pipeline that would only transport carbon dioxide to and from its own facilities, without providing any service to the general public. In theory, the public would have the right to use the pipeline, but in practice no one but Denbury would have any reason to do so. The Texas Supreme Court quite rightly concluded that a “common carrier” taking must actually serve the general public, not just the carrier itself:

To qualify as a common carrier with the power of eminent domain, the pipeline must serve the public…. [E]xtending the power of eminent domain to the taking of property for a private use cannot survive constitutional scrutiny. The Denbury Green pipeline would not serve a public purpose if it were built and maintained only to transport gas belonging to Denbury from one Denbury site to another. As a constitutional matter, we can see no purpose other than a purely private one in such circumstances….

We accordingly hold that to qualify as a common carrier of CO2 under Chapter 111 [of Texas law], a reasonable probability must exist, at or before the time common-carrier status is challenged, that the pipeline will serve the public by transporting gas for customers who will either retain ownership of their gas or sell it to parties other than the carrier.

The case has been remanded for the trial court. In order to prevail there, Denbury would have to prove that its pipeline will transport carbon dioxide for the general public and not just its own use.

Some press commentary suggests that this decision will have a major impact on future pipeline takings in Texas. That may be so. But Texas eminent domain law contains several other loopholes that make it easy for private interest groups to get government to condemn property for their own benefit. As I discuss in this article and here, Texas’ post-Kelo eminent domain reform law includes a very broad definition of “blight” that enables almost any property to be declared blighted and transferred to private parties. Oil companies and others seeking to use eminent domain for private pipelines might be able to get the land they want by having it declared blighted. This might require greater political clout than the direct private exercise of eminent domain under Chapter 111. The oil company in question would have to lobby the local government or redevelopment agency. However, Texas oil companies certainly have plenty of political influence.

UPDATE: I have not been able to find a link to the decision online. It is, however, available on Westlaw and Lexis.

UPDATE #2: I have corrected some minor errors in the initial version of this post. Because I made the corrections within a few minutes of the original posting, I am not going to describe them in detail, since I don’t think there was any time for the mistakes to influence public discourse on the case.

NYC regulators recently banned dogs from bars, even those with outdoor seating areas and those that serve only beverages:

[I]t has always been a violation of the city’s health code to allow a dog anywhere near a beer tap. But for years, this has been one of the most widely — and gleefully — violated rules in the city.

Not any more.

Since the health department adopted a letter grade system for bars and restaurants last year, bar owners say, health inspectors are allowing no wiggle room for four-legged patrons….

During inspections, many owners said they were surprised to learn that dogs were not allowed even in outdoor seating areas. Neither does a bar’s dearth of actual food products provide any cover. “Beer, wine and spirits have always been classified as food,” a department spokeswoman wrote in an e-mail. Only service dogs are permitted in spaces that serve food or drink of any kind.

As Thom Lambert points out, this is a ridiculous regulation. Dogs near food service areas do pose some risks. But as anyone who has a dog and a kitchen at home knows, they are fairly easy to minimize. More fundamentally, most people can readily understand the (very small) risks involved and decide for themselves whether they want to patronize a dog-friendly bar or not. Market incentives can and do supply plenty of dog-free watering holes for those who don’t want to take the risk of guzzling beer near canines, or simply don’t like dogs.

One of the major advantages of of private property rights is that they provide outlets for people with a wide range of different preferences. Dog-lovers can patronize one set of establishments and dog-haters another. As Thom emphasizes, this kind of diversity also enables communities to flourish, as well as individuals:

We classical liberals are often criticized for undermining communitarian values by emphasizing individual liberties. In reality, though, a liberal society (in the classical sense, not the welfare-state sense) fosters community by allowing people to associate in ways they find most meaningful. Indeed, one of the great things about a liberal, live-and-let-live city is that it can accommodate so many communities that cater to different preferences and values. Orthodox Jews, devout Muslims, evangelical Protestants, gays and lesbians, and various ethnic groups can create their own little communities to foster shared values…..

I was reminded of this point yesterday when I read that the Bloomberg administration, in the name of “public health,” is cracking down on bars that allow dogs…. How sad for New York City. Nothing builds community better than a collection of spaces — bars, coffeshops, diners, etc. — where neighbors can go to relax, converse, and share their lives. And nothing is more likely to keep people coming back and to get them talking to each other than to allow them to bring their dogs. If you don’t believe me, head down to your local dog park and watch people interact. Nobody’s a stranger at the dog park.

Thom’s point is well-taken. I didn’t know most of my current neighbors until we got a golden retriever and people started coming up to pet Willow whenever I took her for a walk. A space where people can bring dogs has a lot more community interaction than one where they can’t.

Property rights are particularly important for protecting unpopular people and groups against persecution. In this case, however, New York City has undermined property rights in a way that harms a much wider range of people for little or no benefit. Dog ownership is extremely widespread and even many non-dog owners enjoy interacting with man’s best furry friends.

Even if you believe you do have a good case against your neighbor, you should think carefully before you start a lawsuit over a fallen tree. Given the high cost of litigation, the money you win might not be much more than what you end up paying the lawyers – unless the damage is really severe. The loss of time and aggravation inherent in suing are also relevant costs, even if nonmonetary ones. And then there’s the cost of damaging your relationship with your neighbor, which is especially important if you plan to live in the neighborhood for a long time. In most cases, it’s worth trying to settle your dispute with a neighbor informally instead of going to court. Robert Ellickson’s classic book, Order Without Law: How Neighbors Settle Disputes, has lots of relevant insights on this score.

As a property law specialist, it’s probably against my interest to encourage people to think twice about suing over minor property disputes. But it’s good advice nonetheless. And part of being a good property lawyer is knowing when to tell your client that a lawsuit may not be the best course of action for them.

I have previously written about the negative impact of blight and economic development takings on the minority poor here. I also discuss the issue in my recent article on “Federalism and Property Rights.”, where I point out that the political weakness of the minority poor who are the most common victims of eminent domain weakens the case for leaving property rights issues to the discretion of local political processes.

Both the Supreme Court and leading legal scholars have often cited federalism as a reason to severely limit federal judicial enforcement of constitutional property rights. Defenders of the federalism rationale for judicial deference on property rights issues make two key arguments. One holds that abuses of property rights by state or local governments will be curbed by interjurisdictional competition, rendering judicial intervention unnecessary. The second is the superior knowledge and expertise of state and local governments relative to federal judges.

This article criticizes both claims. Part I explains why competitive federalism is unlikely to provide effective protection for property rights in land because property is an immobile asset. People who “vote with their feet” by leaving a jurisdiction cannot take their land with them. For this crucial reason, interjurisdictional competition will often fail to effectively protect property rights in land, though it may be more useful in the case of rights to mobile property.

Part II takes up the issue of diversity and expertise. While state and local governments may indeed have greater expertise than federal courts in assessing local conditions, federal judicial protection of property rights ultimately empowers not judges but property owners. It is the latter who will actually get to decide the uses of the land in question in cases where federal courts prevent state or local governments from condemning their property or restricting its use. Owners generally have greater knowledge of their land than local government officials do. Moreover, the local expertise rationale for judicial deference on property rights would, if applied consistently, justify judicial deference to state and local governments with respect to numerous other constitutional rights, including those protected by the First and Fourth Amendments.

Blogosphere mavens might be interested to learn that this is the first major article I wrote that was inspired by a blog post, specifically this exchange with NYU law professor Rick Hills (who is one of the “leading legal scholars” mentioned in the abstract). Although we continue to disagree on this issue, I’m grateful to Rick for the inspiration, and for his very helpful comments on the paper.

In articulating the reasoning behind and criteria to be used for creating the retail corridor on Bandera Road, the text of the [zoning] ordinance does not mention religion. The City’s real problem lies in the ordinance’s “Permitted Use Table,” which lists many types of buildings by use and then specifies the zone or zones in which each is or is not permitted. Specifically, the use table notes that “Churches” are not allowed in B-2 zones at all, but that many nonreligious, nonretail buildings, e.g., “Club or Lodge (private),” are allowed to request SUPs [special use permits] and, if granted, to occupy a B-2 zone. Try as we may, we cannot reconcile the ordinance’s facial treatment of a church differently than a private club in light of the way that B-2 zones are defined….

At bottom, the ordinance treats the Church on terms that are less than equal to the terms on which it treats similarly situated nonreligious institutions. We conclude therefore that the imposition of the City’s ordinance violates the RLUIPA’s Equal Terms Clause.

I think the decision is correct, though it must be said that it does very little to clarify the ongoing debate over the application of RLUIPA to different kinds of zoning ordinances. In this case, the double standard applied to churches as compared with secular land uses was so blatant that it violated almost any plausible reading of RLUIPA’s requirement that religious land uses may not be regulated on “less than equal terms” with secular ones.

CONFLICT OF INTEREST WATCH: I played a very minor role in the case by helping the Becket Fund for Religious Liberty (which represented the Elijah Group) prepare for the oral argument. I was not a paid consultant, but helped out on a pro bono basis.

UPDATE: I have changed the title of this post to make it more clear.

Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection was the Supreme Court’s first effort to address the problem of judicial takings: whether or not a judicial decision can ever qualify as a taking that requires compensation under the Takings Clause of the Fifth Amendment. Unfortunately, a divided Court failed to resolve the issue, which is now left for future cases.

This article argues that judicial takings do exist. I also explain why this conclusion would not require federal courts to take on any unusual administrative burdens. Part II briefly discusses the background of Stop the Beach. In Part III, I defend Justice Antonin Scalia’s conclusion that “the Takings Clause bars the State from taking private property without paying for it, no matter which branch [of government] is the instrument of the taking.” This principle follows logically from both the text and the original meaning of the Fifth Amendment. Various rationales for distinguishing judicial takings from other takings do not overturn this simple but sound conclusion.

Part IV addresses claims that enforcing a takings doctrine would lead federal courts into severe practical difficulties. A judicial takings doctrine would not require legal principles significantly different from or more complicated than other takings claims. Justice Stephen Breyer and others are wrong to suggest that such a doctrine would “invite a host of federal takings claims” that federal judges would be unable to handle.

I previously blogged about the Stop the Beach Renourishment case here.

Here is the abstract:

Kelo v. City of New London was one of the most controversial decisions in Supreme Court history, generating a massive political backlash that led 43 states to adopt eminent domain reform laws restricting economic development takings of the kind the Court ruled were constitutional. In addition to the better-known legislative reaction, Kelo was also followed by extensive additional property rights litigation in both federal and state courts. This is the first article to systematically analyze the judicial reaction to Kelo.

Part I briefly summarizes Kelo and its holding. Part II considers state court interpretations of their state constitutional public use clauses since Kelo. Most of these cases have repudiated Kelo, either banning economic development takings outright or significantly constraining them. Part III considers judicial interpretations of Kelo’s “pretext” standard. This is the one area where Kelo might potentially permit nontrivial public use constraints on condemnation. Kelo indicated that condemnations are unconstitutional if the officially stated rationale for the taking is a pretext “for the purpose of conferring a private benefit on a particular private party.” State and lower federal courts have not come to any consensus on what qualifies as a pretextual taking. Nevertheless, several decisions suggest that the pretext standard may have some bite.

Overall, state courts have taken a skeptical view of Kelo, often rejecting it as a guide to the interpretation of their state constitutions. This reaction continues the pre-Kelo trend of increasing judicial protection for property rights at the state level.

This article is a companion piece to my previous work assessing the much better-known political reaction to Kelo.

It was drop-the-gloves time in Allentown City Council chambers Wednesday night.

A parade of downtown merchants, their attorneys and supporters laid into city officials, saying their heavy-handed efforts to pressure them into selling their properties under threat of eminent domain to make way for a hockey arena would kill their livelihoods.

That didn’t stop council from voting 6-1 to authorize city officials to use eminent domain to acquire the holdouts….

One after another, merchants said they need more than just a few months to make a life-altering decision on whether to sell their properties and more information about the arena plan itself. They said they were given little information and inadequate offers of relocation assistance.

“Are you going to relocate my business, are you going to take care of my family, are you going to take care of my livelihood?” said Chong Lee, who operates New York Fashions on Hamilton Street.

In March, Pawlowski’s administration began approaching landowners with property in the one-block footprint of the arena between Hamilton, Linden, Seventh and Eighth streets with offers to buy their buildings. About half have cut deals with the city.

Pawlowski hopes to build a sports and entertainment complex centered on an $80 million to $100 million hockey arena that would be home to the minor league Phantoms, the farm team for the National Hockey League’s Philadelphia Flyers.

As is often the case, city officials are defending the use of eminent domain on the grounds that it will produce economic benefits for the community. However, as Kelo v. City of New London and many other cases show, such condemnations often destroy far more economic value than they create. In addition, numerous studies show that public subsidies for sports stadiums routinely fail to promote economic growth. This is true even of stadiums that house popular major league teams, much less minor league facilities like the one planned for Allentown.

The proposed Allentown taking may also run afoul of Pennsylvania’s post-Kelo eminent domain reform law, which forbids most takings that transfer property to a “private enterprise,” unless the land in question is “blighted” in tightly defined sense of the word (unlike the extremely broad definitions of “blight” that continue to prevail in many states, such as New York). I have seen downtown Allentown and it is clearly not blighted, as defined by the new law.

Unfortunately, Pennsylvania’s law has a crucial loophole that excludes the area around Pittsburgh and Philadelphia until 2012. But Allentown is probably too far from Philadelphia to be covered by that exception, though I welcome correction by experts in Pennsylvania law on this point.

I can’t make a definitive judgment about the legality of the proposed Allentown condemnation without knowing more about the details of the plan. But my initial impression is that it’s probably illegal under Pennsylvania’s post-Kelo reform law. Legal or not, the Allentown plan is yet another example of a dubious economic development taking that is likely to harm the community far more than it benefits it.

UPDATE: This story suggests that the new arena may be publicly owned, in which case it would not violate the post-Kelo eminent domain reform law. However, the same story and previous reports indicate that the development plan may include privately owned facilities and that the arena could be controlled by a private developer. Currently, the Allentown Economic Development Corporation, a private organization, is trying to acquire property for the arena, using the threat of eminent domain as leverage. If the AEDC is to be the owner of the arena, it would not qualify as a publicly owned stadium. We may not know whether the plan is legal or not until it becomes clear who will ultimately own and control the arena.

For reasons, I discussed in this post, the National City case is a particularly egregious example of the widespread phenomenon under which local governments use of dubious blight designations to condemn property and transfer it to politically influential developers and other interest groups. The City declared a vast area to be “blighted” on the basis of extremely dubious evidence, and then refused to even make the evidence available for public scrutiny.

The problem of blight condemnations is far from limited to California. In numerous states, broad definitions of “blight” have undermined post-Kelo eminent domain reforms supposedly intended to protect property owners against eminent domain abuse. If pretty much any area can be declared blighted and condemned, no one’s land is safe unless, of course, they have a lot of political clout.

The trial court ruling is only the first step in an ongoing legal battle. California courts are historically very deferential to blight condemnations, and it’s certainly possible that the trial court will be overruled, at least on some issues.

I may have more to say on this subject later. But for now, I must conclude, as my laptop battery is running low, while I wait for my connecting flight to Istanbul at the Vienna airport.

CONFLICT OF INTEREST WATCH: I have done pro bono work for the Institute for Justice on various other property rights cases. But I have not had any involvement with this one.

The GOP’s stance on this issue is extremely unfortunate, and at odds with the Party’s supposed devotion to free markets and property rights. As Steven Greenhut, an expert on California property rights issues points out in a recent Wall Street Journal op ed, the redevelopment agencies are notorious for their abuses of the power of eminent domain for the benefit of powerful private interest groups:

[I]n the last 60-some years, redevelopment agencies have become fiefdoms that run up enormous debt and abuse eminent domain by transferring private property to large developers promising to build tax-generating bonanzas. Today, there are 749 such projects. In the late 1950s, there were only nine. According to the state controller, redevelopment agencies consume about 12% of all state-wide property taxes—money that would otherwise go to critical public services….

Palm Desert’s redevelopment agency proposed to eliminate so-called blight by spending nearly $17 million on revamping a municipal golf club that remains one of the nation’s premier golfing locales.

In the 12 years I’ve spent reporting on this issue, I’ve seen an agency attempt to bulldoze an entire residential neighborhood and transfer the land to a theme-park developer. I’ve witnessed agencies declare eminent domain against churches—which pay few taxes—in order to sell the property at a deep discount to big-box stores that promise to keep city coffers flush. Working-class people and ethnic minorities often are the victims of this process since they often live in the vulnerable neighborhoods, and they have less muscle than big business developers.

The trouble is that blight is an amorphous concept, easily abused by government officials and redevelopment agencies. Once “blight” is found, the agency creates a project area and can then begins selling bonds (incurring debt) without a public vote. In 1995, one area of the city of Diamond Bar, where I lived, was declared blighted because there was chipped paint on some buildings….

While economic development and local control are crucial issues, it’s hard to understand why any Republican would believe that a regime of government planning and subsidy is the best way to achieve those goals. They should be standing up against the abuses of property rights and the fiscal irresponsibility inherent in the redevelopment process and championing market-based alternatives to urban improvement—even if it means defending a proposal from a Democratic governor they often disagree with.

As I have often pointed out in previously, dubious “blight” condemnations are one of the most serious threats to property rights in the United States today. They are especially likely to be used to victimize the poor, ethnic minorities, and the politically weak.
For these reasons, among others, Jerry Brown’s proposal should be supported not only because it will save the state money, but because it will protect vulnerable property owners against abusive takings. It’s also worth noting that these kinds of blight condemnations not only cause great harm to their victims, but also generally fail to produce the economic growth that supposedly justified them in the first place.

Overall, I have been skeptical about the prospects for “liberaltarianism,” the proposed political coalition between liberals and libertarians. On this issue, however, the two groups have an obvious common interest. The libertarian goal of protecting property rights overlaps here with several liberal objectives, including helping ethnic minorities and supporting one of the nation’s most prominent liberal governors.