Sunday, March 09, 2008

"The dire warnings of eminent domain apologists are not to be believed."

Let's not forget just whose domain it is


Fort Worth Star-Telegram
Copyright 2008

Property owners across the Lone Star State have a Texas-sized problem on their hands: eminent domain abuse, in which the government takes private property not for public projects (like the construction of a courthouse) but for private gain (such as the creation of big box stores or high-end homes).

For example:

  • The city of El Paso is determined to wipe out acres of downtown businesses -- including Asian and Jewish merchants -- for a fad-driven shopping and entertainment district.
  • Mere hours after the U.S. Supreme Court handed down its infamous Kelo decision allowing eminent domain for private gain under the U.S. Constitution, Freeport officials condemned two successful shrimp companies so that a wealthy developer could build a private marina.

Thanks to vocal beneficiaries of eminent domain abuse, Texas passed only nominal reform, leaving open a loophole large enough to lasso entire neighborhoods with bogus "blight" declarations.

Eminent domain enthusiasts defend their position by predicting economic doomsday if their power is in any way restrained. Despite countless examples to the contrary, people such as Bart Peterson, who testified before Congress on behalf of the National League of Cities, insisted: "If [eminent domain] vanishes, the redevelopment experienced in many communities in recent years would literally come to a complete halt."

That kind of hyperbole has led local government officials across the state to use eminent domain for the private gain of politically connected developers over hard-working, taxpaying Texans.

New research released earlier this year, however, demonstrates that the dire warnings of eminent domain apologists are not to be believed.

Using rigorous statistical methods, the Institute for Justice examined three indicators closely related to economic development: construction jobs, building permits and property tax revenues. IJ compared those data from states that passed reforms with data from states where no reform has taken place. IJ also compared the trends in the economic indicators before and after reform.

Because jobs, permits and tax data are closely tied to development, one would expect to see early negative effects of eminent domain reform if, in fact, there were some. But there weren't.

The data reveal that even strong post-Kelo reforms have provided greater protection to homes and small businesses without sacrificing economic health. Strong property rights and healthy economic development can coexist.

Despite universal public opposition to the taking of homes and businesses for a private developer's profit, no national political candidate has embraced the issue, even though studies demonstrate that racial minorities and the poor (key Democratic constituencies) are disproportionately affected by eminent domain abuse and Republicans are supposed to value property rights.

With no ill economic effects -- and with the substantial benefits that strong reform provides to the rightful owners of property and society as a whole --legislators in Texas and nationwide should ignore the apocalyptic hand-wringing of eminent domain abusers and reform their state's laws to curb its use for private development.

Today, it is businesses from Freeport to El Paso that are under threat of eminent domain abuse. Tomorrow, it could well be your home that is targeted for a private development project.

Dick Carpenter II is director of strategic research for the Institute for Justice ( and co-author of the report "Doomsday? No Way: Economic Trends and Post-Kelo Eminent Domain Reform."

© 2008, Fort Worth Star-Telegram:

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