Recently there has been quite a tempest stirring in the public regarding eminent domain. Events in Connecticut and Ohio have many states reviewing eminent domain laws and their constitutionality, and battles are being waged before two state supreme courts in regards to this very question. Two links exploring these battles and how they came about are here:
In the New London article, please click on the picture download link and take a look at the “blighted” homes that have been targeted by these vague eminent domain laws. The pink home in particular looks not at all like a blighted home one would expect being marked for condemnation. I guess Mellencamp had it wrong when he once said, “little pink houses for you and me”. Government has no place in seizing these properties to hand over to developers and others in the name of economic growth (and then, even more shockingly, in a “compromise”, decided to let the residents stay but charge them rent). Not only are multipliers and other indicators of such growth often misinterpreted or misused in the name of progress and/or politics, but the government is treading on thin ice with the law when they seize the property. Property rights are one of the most fundamental tenets of our free market economy. When the lines of this are blurred then the free market existence is questionable. In the study of economic development, one of the first things the WTO and other organizations will look at is the existence of such rights and their enforceability. In what’s arguably the greatest country in the world, these rights are in some communities being trounced underfoot. But, unfortunately, the Supreme Court didn’t see it that way when they ruled on the New London court battle.
Many states have now seen the light and are finally questioning the wording and use of such eminent domain laws. Some 36 states are now considering legislation and other changes to wording in laws to limit the use of eminent domain in property seizures for the use of private development. The high-profile case of the New London landowners has fostered a bit more discussion in regards to governmental rights and has at least done the job of bringing the question of eminent domain to the spotlight in almost every state in the union.
The cascade of politicians pushing bills through state legislatures has been overwhelming in the wake of the public uproar that followed the Supreme Court decision. In following their constituent’s voices and not the special interests that lobby for more government power in this regard, it looks like the politicians may finally be getting this one right. From an economic standpoint, using eminent domain in such a broad, ambiguous manner can be damaging to the free market system the United States was founded on, not to mention blurring the line between property rights and a totalitarian state.