Take My House, Please
Press Action
Friday, June 24, 2005
http://www.pressaction.com/news/weblog/full_article/beckman06242005/
By Scott Beckman
On Thursday, June 23, 2005 the Supreme Court decided officially, once and for all, that local governments may seize people’s homes and businesses—even against their will—for private and public economic development.
The main modern rationale underlying this “eminent domain” power of government is that sometimes it is in a community’s interest to remove “blight” (a good term that generally encompasses a situation that most reasonable people agree is socially unproductive) in order to replace blight with “new investments” or “developments” (also good terms meaning things that most reasonable people would agree are big improvements on what was there before, like new affordable housing or job-creating businesses).
That all makes sense to me. In theory. For example, because of the U.S. government’s long-standing failure to devise a sensible urban policy to combat rampant disinvestment and abandonment in many of the nation’s urban centers, there are now many places in America where whole neighborhoods are filthy slums full of ramshackled, dangerous vacant or unsafe dwellings many miles distant from jobs and community services. I’m sure this potentially positive application is one of the situations that some of the Justices had in uppermost in their mind when they issued this ruling. I’m sure they “intended” to provide cities with the flexibility they need to address core quality of life issues such as this and I agree that “eminent domain” is a necessary tool that governments needs to clean up messes like this. In theory.
In practice, however, I believe the evidence is pretty clear that “eminent domain for economic gain” doesn’t work like that. Think about it. How many companies do you know who consciously strive and publicly state that they want to help clean up America’s inner-cities? Right. When you get down to it, examine their vision, mission, products, services, investment strategies, the answer is few to none. So, who’s working who in this “eminent domain” business? Is government working the companies or are companies working the government?
To me the answer is pretty clear. Companies are working the governments big time. Here’s a prime example: state economic development incentives. For the past generation, a fierce and controversial “economic war between the states” has been raging. In their lust to fuel economic growth at any cost, states have become extremely competitive and generous in throwing tax breaks, tax credits, free land, low-cost financing, access to cheap labor, and the kitchen sink into deals intended to entice companies to locate their operations in a specific location. Very often these deals are conditioned on a company’s promise to provide good wages and good jobs for local residents for a very long time.
So, how have they done? Well, here’s my sense of what the scant research on this important subject tells us. They’re doing LOUSY. The great state of Minnesota issued a study in recent years of its own economic development incentives program entitled, “Economic Development in Minnesota: High Subsidies, Low Wages, Absent Standards.” And that pretty much sums up the findings of almost every credible study I’ve ever seen on the subject and this executive summary is basically confirmed in a U.S. Economic Development Administration of the U.S. Department of Commerce report called, “Evaluating Business Development Incentives.” The authors wrote:
“A review of the academic and policy literature suggests that many states and communities are offering large incentive packages with limited impacts and poor fiscal returns on investment. Yet, these analyses tend to depend on anecdotal evidence because very little national information exists about how much is being invested in incentive programs offered at the state and local level.”
In other words, there is INSUFFICIENT PROOF that economic incentives (and that would include property seizure for the purpose of business development) have cost-effectively served a bona fide public economic purpose and what little evidence exists REFUTES the central rationale underlying the Supreme Court’s “eminent domain” ruling. Talk about blind justice.
Greg LeRoy put the bottom line of this “public interest” scams in the best lay terms I could find in his article, “No More Candy Store: States and Cities Making Job Subsidies Accountable.”
“Lurking within the records of almost every city and county and state in America there lies a scandal. A tax scandal. A jobs scandal. A political-accountability scandal.
Look up the name and applications of the companies that have received development subsidies—tax abatements, low-interest loans, training grants, infrastructure aid—and then check their performance.
Chances are, you will find companies—many companies—that have failed to create or retain as many jobs as they said they would. Companies that are polluting the environment. Companies that are discriminating again women or minorities. Companies with low-quality jobs and few benefits.
Dig a little deeper and you’ll likely find some companies that didn’t create any jobs at all, even some that lost jobs after getting their aid. Keep digging, and you’ll probably find companies that used subsidies just to transfer jobs from other locations. Companies that have used jobs to bust unions.?
Therefore, in my opinion, the Supreme Court’s ruling has NOT properly weighted the preponderance of the available evidence showing that many governments AND many businesses have consistently FAILED to properly employ economic development incentive programs to achieve the ends for which they were intended. I strongly oppose this ruling because the balance of the evidence with which I am familiar suggests that the unfettered “eminent domain” powers that have now been granted will undoubtedly be practiced by unscrupulous operators solely to their own benefit at the expense of unsuspecting property owners and ignorant taxpayers who now have no recourse for the egregious abuses to which they are totally exposed except to cry “foul” at the immense land grabs that bevies of corporate land attorneys are no doubt already concocting, and which, only in hindsight, after they are all completed within the letter of the law, will we ultimately see to be utterly reprehensible.
I first heard of the Court’s ruling on this matter on CNN’s Lou Dobbs Tonight. The program took a straw poll in the course of the hour asking what viewers thought of the Supreme Court’s ruling. 99% were opposed. 99%! While it may be unscientific, I think that little slice of the viewer’s mind is pretty indicative of what the “public” thinks is the highest “public” interest in this case and that is, to speak plainly, they value private property rights much higher than they do either community economic benefit or corporate power. This one is just the worst in such a long line of, what? Things we will lie down and take I guess. 99-1 against taking OUR HOUSES and none of the little chirping complaints a few of us make will change it. How pathetic we are.
James Madison once said, “If men were angels, no government would be necessary.” This quote encapsulates everything that is wrong about giving the current institution of our government, which has proven itself beyond a shadow of a doubt to be utterly corruptible and corrupted by moneyed interests, the power to take away our homes for what amounts to any darn excuse they care to come up with.
I want government protection from such tyrannical power, not government complicity. The only imaginable remedy is for the Congress of the United States to enact new laws which much more clearly define and appropriately limit the use of “eminent domain” powers to those things which at least a majority of the people can agree is needed to conduct important affairs of State. But, my list of such grievances that should also be so handled is long and I doubt this matter will get any more attention than any other of my unheeded calls for decent representation. So, by all means, go ahead, take my house.
Scott Beckman, srbeckman@yahoo.com, is Development Director for the Northern Pueblos Housing Authority in Santa Fe, N.M.