TCS Daily

Property Matters

By C. C. Kraemer - May 3, 2004 12:00 AM

Is private property, a right protected both by the Constitution and basic human liberty, under assault in America? In some places, it seems that it is.

Connecticut's Supreme Court, making law rather than interpreting it as the judiciary should, recently shredded constitutional property rights when it ruled that private ownership of land was subject to the needs of local governments. And who defines those "needs?" The very people who covet others' property the most: the local governments, which are too often acting as representatives -- or rather pirates -- for private interests.

The excuse is that governments are simply exercising their privilege of eminent domain, a theory that appears to be legitimately based on the Constitution's Fifth Amendment protection of property. While shielding private lands from government seizure, the Constitution does allow the state to take property, but only under the limitation that it provides just compensation and the taking is done only for public use, such as roads, courthouses, schools and other similar projects.

Eminent domain, however, has been around in this country about as long as the Constitution and was given legal standing in 1879 by the Supreme Court in Boom Co. v. Patterson. The court ruled that eminent domain "requires no constitutional recognition; it is an attribute of sovereignty."

But the practice has been taken more than a little too far. It's been hurled into space by cities, counties and states that want to fatten their tax revenues by kicking out landowners who don't pay as much in property taxes as do the commercial developments that replace them.

Last year, in one particularly outrageous case, the city government of Alabaster, Ala., filed legal condemnation papers to seize private property for a development company that did not own all of the land it needed to build a shopping center. The issue was settled after some property owners decided to fight in court, but that doesn't exonerate the Alabaster government for its eagerness to use the police power of the state to seize private lands on behalf of private interests that have more political clout.

Though he probably had no idea how his words sounded, Alabaster Councilman Tommy Ryals, a bureaucrat in the environmental compliance department of Alabama Power, provided the most revealing comments on the situation. Atlanta radio talk show host Neal Boortz reports that Ryals felt some of the property owners were a bit too materialistic. Ryals said that "Sometimes the good of the many has to outweigh the greed of the few."

Wonder if he'd feel the good of the many in his subdivision outweighed his greed for wanting to keep what's his if a voting majority of his neighbors wanted to plant a cooperative garden where his house stands? But then he's an elected "servant" of the people, so he doesn't have to worry about that. He and his colleagues will be sure he's protected. Others? Well, they just have to stay on the right side of raw political favoritism.

The list of other cities that have recently bullied landowners on behalf of private interests isn't short, but it does include Jacksonville Beach, Fla., New London, Conn., Riviera Beach, Fla., and Toledo, Ohio.

But perhaps the most famous violator is the state of New York. The government there assisted The New York Times, which consistently shades the world in hues of the-people-versus-the-powerful, in acquiring an entire block on Eighth Avenue to build the Times' 52-story corporate tower. Critics say the Times will get the land from the Empire State Development Corporation, a state agency, at 10 to 15 cents on the dollar at the expense of the property owners whose land was condemned. The deal probably won't be that cushy, but the charge illustrates the point.

Other violations of property rights are more subtle because they don't involve real property but intellectual property. However, they are just as harmful. Imagine taking an idea and turning it into a book, an important piece of software or some unique invention, yet being unable to enjoy the due rewards because a bureaucrat or judge, at the behest of a competitor or other interest, decide the property rights would be ignored. Think of Microsoft and Judge Thomas Penfield Jackson's attempt to separate the company from its principal product. Or of attempts to shorten the time a patent protects an item so that imitators can piggyback on the inventor's efforts.

James V. DeLong, author of "Property Matters: How Property Rights are Under Assault -- And Why You Should Care," sees a continuum that links physical property to intellectual property. He believes that the same principles that guide us in shielding real property are the basis for protection of intellectual property. That's a concept that policy-makers should embrace. It's just too bad that the security of real property appears to be, at least in some places, slipping or exposed to the urges of interests that should have no authority over property owners.

Voters in Miami Beach, for instance, decided through a referendum in March that some development was going to be subject to public whim. The ballot measure requires that voters approve any changes that increase the height or density of multifamily and commercial buildings in the city. It's not a full assault: single-family homes are exempt from the rule.

The Miami Beach regulation might sound like a high-minded law: let the people decide. But if a property owner is denied his right to improve his property by voter decree, his property is in effect taken by the state. It might be his fellow citizens who decided; but it is the state that enforces the law. Either way, this is the rule of the mob, not the rule of law.

This sort of majoritarian system is dangerous, yet few take note because we've been conditioned to miss it. Ever since we were kids we've heard that the "majority rules."

But some of us grew up and heard about another principle: the tyranny of the majority. In many of the eminent domain abuse cases, though, it is not even the tyranny of the majority; it's the tyranny of the majority of an elected body. Greed, it seems, doesn't stop when one takes public office. In fact, for many, that might be when it begins.


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