News
Law Office Management
Feb. 2, 2006
The Great Property Rights Revival
When the U.S. Supreme Court backed a local authority's right to take people's homes, it not only triggered a massive backlash but also reenergized the enemies of big government.
There's this episode from The Simpsons where Homer goes to college and befriends the nerds. "Do you remember it?" Timothy Sandefur asked 50 or so students at the University of San Francisco School of Law. "As the nerds are leaving the college, Snake the bully comes up to them and says: 'Wallet Inspector.' So the nerds dutifully hand over their wallets. 'I believe that's all in order,' the nerds stupidly tell him. And then Snake, who can't believe they've fallen for it, tears off with their wallets. 'Hey,' Homer tells the nerds, 'that's not the wallet inspector.' "
Sandefur was on a roll, and the point he was trying to make at this recent, student Federalist Society function is that in the final analysis there isn't a whole lot of difference between a wallet-snatching "inspector" and just about every other government bureaucrat who ever lived. "Sure," he says, "the government could create a wallet inspection department. But that would be wrong. That would be a bully exploiting the power of the state for his own benefit. It's the difference between a legitimate use of force and an illegitimate use of force. A legitimate use of force is the use of force to protect the rights of everyone in society. But an illegitimate use of force enriches a private group at the expense of others. It's the difference between law and legislation."
Sandefur, who is a 29-year-old staff attorney with the Pacific Legal Foundation (PLF), had been giving this speech a lot. In fact, before USF, he spoke at another Federalist Society event at UCLA. And before UCLA, Loyola. And before Loyola, Chapman, his alma mater. His wonkish ebullience both charms and amuses, making him the perfect recruiter for PLF's fellowship program-the same program he went through before landing a job with PLF in 2002. "An evangelist for economic liberty" is how one colleague describes him.
Besides evangelizing, Sandefur worked last summer on an appeal to the Ninth Circuit challenging the constitutionality of a state law that requires all pest controllers to go through a lengthy training and certification process on how to apply pesticides-even if they never use such substances. (Sandefur's client ran a business putting wire spikes on buildings to ward off pigeons.)
However, it was as PLF's most frequently quoted expert on eminent domain that Sandefur was really starting to make a name for himself. The issue suddenly became red hot in June when the U.S. Supreme Court handed down its Kelo decision. (Kelo v. City of New London, 125 S. Ct. 2655.) The case involved nine families in a middle-class neighborhood of New London, Connecticut, whose homes had been condemned by a local redevelopment agency to make way for an industrial park, some condos, and a luxury hotel. Because the homes were not blighted and the intended new uses were private, the families' lawyers argued that the government had no right to force these homeowners out. But in a 5-4 vote, the Supreme Court ruled that state and local governments have broad discretion under the power of eminent domain to advance the economic goals of their communities.
This was the culmination of a very bad year for property rights advocates-a year in which they lost not one but three big Supreme Court cases: The public barely took notice of the first two, Lingle v. Chevron (125 S. Ct. 2074 (2005)) and San Remo v. City and County of San Francisco (125 S. Ct. 2491 (2005)). But Kelo triggered a tidal wave of criticism from columnists as diverse as George Will and Molly Ivins and from politicians as ideologically incompatible as U.S. Reps. Maxine Waters and Richard Pombo. Moreover, as the furor intensified, legislators across the country began introducing bills to rein in the power of local governments to condemn people's homes and businesses. In California the most far-reaching legislation was sponsored by Tom McClintock, the silver-haired Republican state senator from Thousand Oaks. His proposal: an amendment to the state constitution that would ban the use of eminent domain for any private development.
McClintock announced his measure, SCA 15, at a press briefing July 14 at the state capitol. "It used to be," he said, "that if a widow didn't want to sell her home to a developer, she didn't have to. That was the end of the matter, unless the developer sent in a bunch of thugs to beat her up. ... Now, government has become the thug." McClintock's supporters that day included Tom Bittle, director of legal affairs for the Howard Jarvis Taxpayers Association; Mohammed Mohanna, a real estate developer from Sacramento; and Assemblymember Doug LaMalfa, who elicited snickers from reporters when he briefly strayed from his prepared text: "As in The Godfather," LaMalfa said, "if they want to take my property, we're going to make them an offer they can't refuse."
Finally, McClintock introduced Sandefur, who had helped with the bill's drafting.
"Eminent domain is a nationwide epidemic," Sandefur began, trying not to speak too quickly, which is what he tends to do when he's reading from a script. He went on to speak of a Toyota dealership in Kansas that was forced, through the power of eminent domain, to sell its land to a BMW dealership. He also spoke of a blue-collar, immigrant neighborhood in Detroit that was wiped out by General Motors; an elderly woman in Atlantic City whose home was targeted for condemnation by billionaire Donald Trump; and a church in Cyprus, California, that was threatened with extinction by a proposed Costco.
Said Sandefur: "This is a matter of the perversion of government power versus the Constitution. That's why the NAACP, AARP, Ralph Nader, the Pacific Legal Foundation, and others all joined forces to oppose the abuse of eminent domain."
Indeed, the Kelo decision was hugely unpopular. According to one MSNBC poll, a surreal 98 percent of the public disapproved of the ruling. But would the outrage last? And, even if it did, what would that mean for the property rights movement as a whole?
There can be little doubt about the importance of the Pacific Legal Foundation in advancing the property rights agenda. Founded in 1973 by a handful of lawyers who worked together under Ronald Reagan when he was governor of California, its vision was to replicate the success of such advocacy groups as the NAACP and the ACLU, except with a conservative, pro-business agenda.
In its first years, PLF beat back an attempt by the Environmental Protection Agency to control air pollution by restricting automobile traffic in five states, including California. The foundation also won a federal court ruling that permitted the supersonic Concorde jet to land at Washington's Dulles International Airport. And it successfully argued for the use of DDT to save Northwest timber from a moth infestation.
But PLF's big breakthrough in property rights didn't occur until 1987 in a case called Nollan v. California Coastal Commission (483 U.S. 825). In that case, the question was whether a particular regulation was so burdensome that it constituted a taking under the Fifth Amendment of the Constitution. (As the Takings Clause of the Fifth reads, "... nor shall private property be taken for public use, without just compensation.")
Up through the first two decades of the 20th century, it was all very simple: For there to be a taking, there had to be a direct appropriation or invasion of the piece of real estate at issue. But in 1922, in one of Chief Justice Oliver Wendell Holmes's more cryptic opinions, he wrote, "[W]hile property may be regulated to a certain extent, if the regulation goes too far it will be recognized as a taking." (Pennsylvania Coal v. Mahon (260 U.S. 393).)
How far is too far? At the time of Nollan, anyone's best guess would have been based on Penn Central Transportation Co. v. City of New York (438 U.S. 104 (1978)). In that opinion, the U.S. Supreme Court articulated a three-pronged balancing test to determine what is a compensable taking. One of these prongs dealt with the economic impact of the regulation. Another had to do with the degree to which a regulation interfered with the investment expectations of the owner. And the most vaguely worded of the three referred to "the character of the governmental action."
This ad hoc test displeased property rights advocates for a couple of reasons. For one thing, they argued that, for any given case, the test doesn't offer much guidance. For another, in practice it tends to weigh heavily in favor of government action. So what PLF's lawyers hoped to do was prod the courts into articulating some bright-line rules that would box in the regulators. The effort went badly for PLF, at first. In fact, it went so badly that by 1986 some lawyers at PLF were actually thinking of giving up. Then along came Nollan.
In Nollan the California Coastal Commission told the owners of a beachfront property in Southern California that if they wanted to tear down an existing structure to build a larger home, they would have to set aside a strip of their land along the coast for public access. The commission argued that this was consistent with the legitimate government purpose of preserving an unimpeded view of the ocean from the road. However, a 5-4 majority of the high court concluded that mere consistency was not enough. Writing for the majority, Justice Antonin Scalia observed: "Unless the permit condition serves the same governmental purpose as the development ban, the building restriction is not a valid regulation of land use but 'an out-and-out plan of extortion.' " Thus, the Court ruled, there needs to be "an essential nexus" between the condition imposed and the legitimate government interest being pursued.
This was a big win for the property rights side, and it portended even bigger wins down the road. That's because the opinion contained enough means/ends analysis to effectively blur the line between a takings and a due process argument. This blurring even made some people wonder whether the Takings Clause could, in the fullness of time, be used to restore the antiregulatory power that the Supreme Court gave up in the 1930s when it abandoned what was called "substantive due process" in property and economic rights cases for the "rational-basis test."
As a radical libertarian, Sandefur believes that all government efforts to redistribute wealth are both wrong and unconstitutional-whether for health care, child care, or even flood relief. This does not make him particularly representative of PLF, which has always straddled the line between conservatism and libertarianism. But it does make him very interesting to talk to.
Throughout the summer and into the fall of 2005, I had several long conversations with Sandefur. During these encounters, which often seemed like philosophical jam sessions as much as formal interviews, he spoke with great enthusiasm about the ideas that animated Jefferson, Madison, and Locke. He also talked a little bit about himself.
"I was a horrible kid," he confided one afternoon at his office in Sacramento. "I was a brat and a nonconformist. I was a bully at first. Then I was always breaking the teachers' rules. I got terrible grades in school, had no friends, and probably had the lowest self-esteem of anyone I knew. And then in my junior year of high school I started to clean things up a bit."
What accounted for the change? Sandefur says it had a lot to do with reading The Fountainhead-Ayn Rand's famous novel about an architect who preferred to blow up a building of his own design rather than see it compromised by someone else's vision. For Sandefur, the essential message was "that idealism can make a difference." Since then, Sandefur has read practically everything Rand has published, and in the process has come to embrace her quasi-Nietzschean views. Sandefur is also a big believer in both natural law and substantive due process, which he spoke about at length at USF.
"When I talk about economic liberty and the law," he told the students, "the big case everybody throws out is the 1905 Supreme Court case Lochner v. New York" (198 U.S. 45). "And when I say 'Lochner,' everybody is supposed to boo and hiss. But I think Lochner was rightly decided, and the reason is a little bit complicated for a brief presentation, but I'll do my best.
"First of all, New York had passed a law that prohibited bakers from working more than ten hours a day on the theory that prohibiting them from working overtime would somehow improve their lot. Joseph Lochner was fined for violating that law by allowing an employee to work overtime, and the New York state courts upheld the conviction. But then the Supreme Court overturned the conviction-on the ground that the law deprived Lochner and his employees of the liberty to earn a living, without due process of law. Now the whole issue behind Lochner v. New York is what is meant by due process. Is it due process if the legislature merely passes a bill? Or are some laws prohibited by the Constitution regardless of how they're passed? Substantive due process says government is created for a reason. And that reason, according to political philosophers like John Locke, is to prevent bullies or their elected representatives from beating people up and taking their things. Due process, therefore, has to contain a substantive component.
"Now after Lochner there was a big swing in favor of the Progressives, then the New Dealers. So these days when the government deprives you of your economic freedom, your right to earn a living, your right to pursue happiness, the Supreme Court says it only has to be rationally related to a legitimate government interest. Let me tell you something: There are only two things you need to know about the rational-basis test. One, it doesn't have to be rational, and two, it doesn't need to be the basis. As long as some nondrunk person could have voted for the law, it passes the test.
"Lochner stands for the fundamental principle that government exists to protect us in our rights. It does not exist to take things from people who earn them and give them to people who do not. It does not exist to give special favors to the politically favored at the expense of those who cannot persuade the government to do their bidding. In Lochner v. New York, the law made it illegal to work overtime if you're a baker. Why? Not for any public reason, but simply to satisfy the interests of socialists, so they could sit home and say, 'Ahh, bakers can't work overtime. Thank God.' But who pays the baker who wants to work overtime but now can't? Let's say he used to make $15 a week and now makes only $10. Who gives him the extra $5? Nobody. Who compensates inner-city kids because we make it so expensive through minimum-wage laws to hire inner-city kids? Nobody. Yet the people who pass these laws sit back and call themselves compassionate. "People who win in a competition of interest groups and in the lobbying contests are the rich and powerful, the politically connected. The more power you give government to redistribute wealth, the less you give to people who live in the inner cities, to working-class people, to people who have to work for a living rather than go and persuade city councils to do things for them. Liberty helps us all, and it helps the poor most of all because they don't have political power. They have to rely on the Constitution."
About a year before Nollan, Richard A. Epstein, a law professor at the University of Chicago, published a book that took the academic world by storm. Called Takings: Private Property and the Power of Eminent Domain, it argued for a bold new era of judicial activism. Zoning, rent control, minimum-wage laws, environmental laws, social welfare programs, and even progressive taxation-all were takings as far as Epstein was concerned. And that would make the Takings Clause every bit as effective a club against big government as due process ever was.
Within academic circles, this densely written book drew unusually fierce criticism. "Like a scruffy dog," wrote one law professor, "this is a book that will tempt every passerby to give it a kick. Its philosophy is little more than assertion, its approach to constitutional analysis is unrecognizable, and its conclusions are stupefying."
But Takings had its fans too. Among them were the editors of the Wall Street Journal, who named it one of the ten best books of 1985. Epstein also appeared to have gotten a very sympathetic read from those in the Reagan administration. Charles Fried, who was solicitor general from 1985 to 1989, later wrote that it was under Epstein's influence that many in the Justice Department sought to use the Takings Clause "as a severe brake upon federal and state regulation of business and property." Epstein's influence even seemed to extend to the attorney general himself.
"[H]onest attempts to interpret the Takings and Contract Clauses of the Constitution should not be disdained as mere 'Lochnerizing,' as some have characterized them," Edwin Meese said in a speech before an economic liberties conference in June 1986. "We must recognize that certain economic rights do exist and are central to the American constitutional order. They are well supported in both the text and the history of the Constitution, and deserve full and fair consideration. ...Within each, a revolution in, or perhaps more accurately, a revisiting and restoration of, economic liberty is a prospect."
Two years later, on the heels of the Nollan decision, the Reagan administration issued Executive Order 12630, which required government decision makers to "evaluate carefully the effect of their administrative, regulatory, and legislative actions on constitutionally protected property rights."
By the early 1990s the property rights movement looked stronger than ever, particularly after Clarence Thomas-who had made a number of speeches endorsing the aggressive protection of property rights-joined the Supreme Court. Indeed, before the Anita Hill controversy broke, the most notable moment in Thomas's 1991 confirmation hearings was when Sen. Joseph Biden, chair of the Senate Judiciary Committee, held up a copy of Takings and asked the nominee if he endorsed Epstein's views. (Thomas, in response, allowed that as a matter of political theory he supported many of Epstein's ideas but insisted there was an important distinction between political theory and adjudication.)
The next year, in one of his first cases on the Court, Thomas ruled with the majority in Lucas v. South Carolina Coastal Council (505 U.S. 1003 (1992)) that if a regulation eliminates all of the economically beneficial uses of a piece of land (short of physical invasion) it's a per se taking without any need to apply the Penn Central balancing test.
Then, in Dolan v. City of Tigard (512 U.S. 375 (1994)), the Supreme Court extended the logic of Nollan by ruling that not only must there be an "essential nexus" between an imposed burden and a legitimate government interest, but also that the burden must be "roughly proportional" to the projected impact of the project. And in 1997, property rights advocates scored another victory in Suitum v. Tahoe Regional Planning Agency (520 U.S. 725)-a case that, perhaps more than anything else, demonstrated PLF's knack for picking extremely sympathetic clients: The plaintiff, Bernadine Suitum, was a half-blind, octogenarian widow who on the day of oral arguments was wheeled into the chamber by her son.
Given the Court's makeup at the time, not to mention the political climate, property rights advocates had good reason to be optimistic. But the next few years saw a shift in the Court's direction.
The first big indication of this occurred in 2002 with Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency (535 U.S. 302). The question was whether a 32-month moratorium on development amounted to a per se Lucas taking.
At one critical point in the oral arguments, Justice John Paul Stevens pressed the petitioner's attorney, Michael M. Berger of Manatt, Phelps & Phillips in Los Angeles, on the meaning of a temporary taking.
Stevens: "[O]f course, the physical taking even for 10 minutes would be a taking. There's no doubt about that. But your view is, even if the regulation prohibits all use of a piece of property, an automobile, whatever it may be, for 10 or 15 minutes, there is a taking."
Berger: "If there is a total prohibition of use."
Stevens: "For 10 minutes."
Berger: "... [T]here is liability."
By 2005 the reversal was complete. It was a curious turn of events; one possible explanation was that the justices, contemplating the profound implications of where they were heading, simply lacked the nerve to go any further. Another explanation is that Justice Scalia's uncompromising style tended to work against lasting coalitions.
Speaking at the Chapman Law School last summer, Sandefur managed to rile a few students when, during the question-and-answer period, the discussion wandered onto the topic of gay marriage. Ever the consistent libertarian, Sandefur suggested that gays should pretty much be allowed to do what they want with their private lives. Then one student countered that homosexuality isn't natural. "Is wearing clothes natural?" Sandefur asked. "But homosexuals can't have children," said another. "Hey, wait a minute," said Sandefur, "is kissing natural? How about infertile couples? Were George and Martha Washington violating natural law every time they slept together?"
From there, the conversation only grew more graphic, with one student wondering aloud how anal sex could possibly be considered natural. Finally, the student who seemed the most agitated suggested that Sandefur should be more careful with his comments. "We're the only friends you have," he said. "Well put," Sandefur smiled.
The exchange underscores the often-glossed-over tensions that exist between libertarians and conservatives. But in my conversations with Sandefur, a different question kept coming up: Should government ever be in the business of taking things away from people to give them to others?
QUESTION: Was there ever a government redistribution program that could be called an unambiguous success?
SANDEFUR: No. Whenever there's redistribution, we're taking capital that ought to be invested in an efficient way by individual investors and spending half of it on bureaucrats, and the other half we're giving away to people who don't earn it.
Q: How about the GI Bill after World War II? Wasn't that an unambiguous success?
S: Well, certainly it wasn't unambiguously successful.
Q: But even if it was a success, you don't believe it was just?
S: If it commits an injustice, it's not successful by any meaningful definition of the word success. How can you divorce success from justice? For a success to be real, it would have to be just.
Q: How about when there's a need for providing food and water and insulin after a catastrophic flood? I don't think many people would question the proposition that government has a legitimate role to play in such circumstances.
S: No. Except for deterring looting and such, I don't think government has a legitimate role to play. And I don't think government has a practical role either. Government is consistently inept at these things. It always fails. Real relief comes from private organizations. It's been a favorite rhetorical technique of collectivists, since at least the days of Charles Dickens, to claim that the free market is cold and heartless and uncharitable. Of course, that's silly. Free societies are breathtakingly charitable. As Milton Friedman points out, all of the greatest charitable institutions in America were founded during the so-called age of the robber barons. The Salvation Army, the YMCA, even the SPCA, were all founded in the 19th century.
Q: So even when minutes and hours can mean the difference between life and death, you think people would be better off without government intervention?
S: Probably.
Q: Probably? There's an element of doubt?
S: Well, of course there's an element of doubt in everything anybody says. But I would say extremely likely.
Q: Do you believe that the poor in some fundamental sense deserve their fate?
S: In a free society? Absolutely. They "deserve" their fate as much as anyone in the world can ever "deserve" their fate. It's true that, for those born into poverty and broken homes, the road is a lot harder-and thanks to government intervention in the economy and social life, it is vastly harder for them than it would be in a free society. Yes, luck matters in a free society, but even bad luck is much fairer than having your fate and your choices made for you by some bureaucrat. More important, though, is the question of justice. Obviously, some people have it harder than I. But that doesn't mean it is somehow my duty to devote my life and energy to serving their wants and needs. You ask if the poor deserve their fate in a free society. I would ask you if people deserve their fate in an unfree society, when their earnings and their homes and businesses are taken away to give to other people because they're more politically popular.
Q: Let's suppose for a moment we could look into a crystal ball and see what a pure laissez-faire economy would be like. And suppose what we find is a society torn by social strife, where the rich keep getting richer and the poor keep getting poorer and the armed forces have to be called in to keep the desperate mobs in check. Suppose, too, that we could look into another crystal ball and find a slightly less pure laissez-faire economy, where the rich aren't quite so rich, but the poor aren't nearly so poor, and the middle is better able to get by. Now I know you don't think it would go that way. But let's suppose it did. Of the two societies, which one would a reasonable person choose?
S: The problem with your "what if" is that you're asking me to ignore everything we know about how the economy and private property works. It's like asking, What if I dropped a rock and, rather than falling to the ground, it just hovered in midair? Such an observation would require us to reexamine all of our previously known laws of nature. But at this point there is so much evidence and so much well-established theory to support the conclusion that capitalism results in a better standard of living for everyone, that it's virtually impossible to imagine what you're imagining.
Last May, three years after Tahoe-Sierra, the Supreme Court ruled in Lingle v. Chevron that a regulation does not constitute a taking simply because it fails to "substantially advance a legitimate state interest." This phrase came from an opinion that Justice Louis Powell wrote back in 1980, in a takings case called Agins v. City of Tiburon (447 U.S. 255). Although the property owners lost that one, it might still have been a huge victory for property rights had it resulted in the establishment of a stand-alone "substantially advance" test blurring the line between takings and due process. The Court had already gone a long way toward doing just that in its Nollan ruling. However, in Lingle the Court, by a 9-0 vote, unequivocally declared that such a test has no place in takings litigation. As Justice Sandra Day O'Connor observed, "[T]his test does not help to identify those regulations whose effects are functionally comparable to government appropriation or invasion of private property; it is tethered neither to the text of the Takings Clause nor to the basic justification for allowing regulatory actions to be challenged under the Clause."
Thus, after Lingle, only two bright-line tests remained in takings litigation, and both were being defined so narrowly that they were of little practical value. One, based on Lucas, says a taking occurs when all economic use of a property is eliminated. And the other, based on a ruling in 1982, Loretto v. Teleprompter Manhattan CATV Corp. (458 U.S. 419), involved only cases in which there is an actual physical occupation. That consigns the vast majority of regulatory takings cases to the Penn Central test-the legal straightjacket that property rights advocates had tried so hard to break out of.
Also in 2005, the Court in San Remo v. City and County of San Francisco barred the vast majority of takings claimants from ever making it to federal court. It did so by ruling that they have no right to relitigate at the federal level once they've lost in state court.
So it really was a terrible year for the property rights movement. But then came Kelo.
Unlike Lingle, San Remo, and Lucas, which were regulatory takings cases, Kelo involved the direct condemnation of property. In Kelo there was never any doubt that the displaced would be compensated. Rather, it involved people who did not want to leave their property for any reasonable price. Under the Fifth Amendment, the government clearly has a right to condemn someone's home to make way for a highway or a bridge. But could that same power be used to promote private development? And when the Constitution says "public use," can it be read as "public benefit"?
In 1954 the Supreme Court answered these questions in the affirmative when it upheld a redevelopment plan in an extremely run-down part of Washington, D.C., over the objections of one of the business owners in the area, who argued that his particular store wasn't blighted. This decision (Berman v. Parker, 348 U.S. 26) gave the green light to scores of urban redevelopment projects across the country-projects that often dramatically improved the financial health of communities but did not necessarily benefit the poor people they displaced. In fact, in many communities the urban renewal that was common during the 1950s and '60s came to be known as "Negro removal." And it wasn't until the 1980s, when states started to pass laws requiring redevelopment agencies to spend a substantial amount of money on low-income housing, that the poor started to do better.
In the 1980s, however, a new kind of eminent-domain abuse began to be reported. In these cases, large companies were able to take blatant advantage of their political clout to uproot well-established, nonblighted communities. General Motors was among the first to be implicated, in the infamous Poletown case, in which more than a thousand Detroit homes were demolished to clear the way for a new Cadillac assembly plant. (In 1981 the Michigan Supreme Court upheld the plan.) Then big-box retailers such as Costco and Wal-Mart began to throw their weight around. And Donald Trump got a lot of press when he tried to force an old woman out of her home to build a limousine parking lot.
But it was Kelo that brought the outrage to a head. As Justice O'Connor observed in her dissent, "The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz Carlton, any home with a shopping mall, or any farm with a factory."
Seven days later, by a vote of 365-33, the U.S. House of Representatives passed a resolution expressing its disapproval of the majority opinion in Kelo. Then, in quick succession, three states-Alabama, Delaware, and Texas- enacted laws restricting the use of eminent domain. By the end of the summer another 25 state legislatures had bills pending on the matter.
In California, where a total of nine eminent-domain bills were filed in 2005, the debate quickly boiled down to a choice between two different approaches. The first was to impose a five-year moratorium on the taking of residential property for private use, to allow time to study the issue. The second approach-spearheaded by McClintock-called for permanently banning the use of eminent domain for any condemnation involving private development. To some, the moratorium proposal seemed like a delaying tactic meant to wait out the public furor. To others, the idea of a ban was akin to throwing out the baby with the bath water, particularly because California already requires a blight finding for condemnations.
On August 17, a couple of experts from the redevelopment side spoke against McClintock's bill at a state Senate subcommittee hearing in Sacramento. One was Bill Higgins of the Institute for Local Government, a nonprofit affiliated with the League of California Cities. "A lot of concern in Kelo has been focused on the loss of a single-family home," he told the subcommittee. "But eminent domain is really important to how we're building our state's infrastructure. As we all know, California is taking on 600,000 new residents a year. And how we serve them, how we provide schools and other necessary public services, isn't always as neat and tidy as condemning for a road."
Higgins went on to talk about Emeryville, where the power of eminent domain was used to clean up a contaminated area so that retail shops and affordable housing units could be built. He also spoke of a developer in Pacifica who, after purchasing a HUD-financed affordable-housing project, tried to evict the 100 seniors living there. The city was able to stop him, Higgins said, by condemning the property, then turning it over to another developer who allowed the seniors to remain. "We have stories on both sides of the issue," Higgins observed. "And what we need to do is really study it and have a measured response before we do anything."
Sandefur also testified that day and expressed a very different viewpoint. "Eminent domain is one of the most extreme forms of government coercion," he said. "I have never met someone who said, 'Well, thank goodness they took my home or business away through eminent domain!' The unfairness under California and federal eminent-domain law needs serious attention now."
As it turned out, no eminent-domain bill made it out of committee in 2005. But the issue was hardly going away. Not with McClintock around, promising to collect enough signatures to put his proposal on the November 2006 ballot-just in time for the run he's making for lieutenant governor.
For all their devotion to property rights, the 23 lawyers now working at PLF do not speak with one voice. For example, the foundation's current president, Michael A. Grob, a soft-spoken, congenial man, seems more inquisitive than opinionated. (During one of my visits, we ended up talking at length about Jared Diamond's best seller Guns, Germs and Steel, a book that, in explaining why some societies are more technologically advanced than others, has virtually nothing to say about property rights.) M. David Sterling, on the other hand, is a PLF old-timer with a more noticeable ideological edge-especially when he's talking about environmentalists who put "critters" above the interests of people. And then there's J. David Breemer, a surfer who traveled extensively before settling in Sacramento. "I used to be a more radical libertarian," he told me. "But some extreme forms of libertarianism would limit government further than I would now be in favor of."
Why the change? I asked.
"I got married," he explained. "I had kids. I don't think just about myself anymore. So I've come to appreciate the need for government to provide some level of protection and stability. For example, when kids go to school, there's a need to protect their health, and that means making sure they all get their vaccinations. Now, a radical libertarian would say that, without it being purely voluntary, that is no legitimate role for government. But kids have to have their shots."'
When I later thought about that conversation, it occurred to me that Sandefur himself will probably go through some changes in the coming years that he hasn't anticipated. Marriage, for one thing, will no doubt have an impact. (At this writing, he has a fianc'ee but has not set a wedding date.) He also recently made a down payment on his first home. But when I suggested he might eventually outgrow the ideology he now holds so dear, he laughed contemptuously. "Well, someday I will grow old and I will lose my mind, and I will be satisfied with poor arguments and shoddy theory," he declared.
Weeks later, in one of our last conversations, I pushed a little harder. "You know," I said, "I have a sense that the ideology we end up with has much less to do with intelligence or reason than with temperament and experience. Don't you think, if you had a different temperament and a different set of experiences, you'd be smart enough to find the logic to justify a very different point of view?"
"I suppose so," he answered. "But that wouldn't make it right."
Martin Lasden (martin_lasden@dailyjournal.com) is a senior editor at California Lawyer.
Sandefur was on a roll, and the point he was trying to make at this recent, student Federalist Society function is that in the final analysis there isn't a whole lot of difference between a wallet-snatching "inspector" and just about every other government bureaucrat who ever lived. "Sure," he says, "the government could create a wallet inspection department. But that would be wrong. That would be a bully exploiting the power of the state for his own benefit. It's the difference between a legitimate use of force and an illegitimate use of force. A legitimate use of force is the use of force to protect the rights of everyone in society. But an illegitimate use of force enriches a private group at the expense of others. It's the difference between law and legislation."
Sandefur, who is a 29-year-old staff attorney with the Pacific Legal Foundation (PLF), had been giving this speech a lot. In fact, before USF, he spoke at another Federalist Society event at UCLA. And before UCLA, Loyola. And before Loyola, Chapman, his alma mater. His wonkish ebullience both charms and amuses, making him the perfect recruiter for PLF's fellowship program-the same program he went through before landing a job with PLF in 2002. "An evangelist for economic liberty" is how one colleague describes him.
Besides evangelizing, Sandefur worked last summer on an appeal to the Ninth Circuit challenging the constitutionality of a state law that requires all pest controllers to go through a lengthy training and certification process on how to apply pesticides-even if they never use such substances. (Sandefur's client ran a business putting wire spikes on buildings to ward off pigeons.)
However, it was as PLF's most frequently quoted expert on eminent domain that Sandefur was really starting to make a name for himself. The issue suddenly became red hot in June when the U.S. Supreme Court handed down its Kelo decision. (Kelo v. City of New London, 125 S. Ct. 2655.) The case involved nine families in a middle-class neighborhood of New London, Connecticut, whose homes had been condemned by a local redevelopment agency to make way for an industrial park, some condos, and a luxury hotel. Because the homes were not blighted and the intended new uses were private, the families' lawyers argued that the government had no right to force these homeowners out. But in a 5-4 vote, the Supreme Court ruled that state and local governments have broad discretion under the power of eminent domain to advance the economic goals of their communities.
This was the culmination of a very bad year for property rights advocates-a year in which they lost not one but three big Supreme Court cases: The public barely took notice of the first two, Lingle v. Chevron (125 S. Ct. 2074 (2005)) and San Remo v. City and County of San Francisco (125 S. Ct. 2491 (2005)). But Kelo triggered a tidal wave of criticism from columnists as diverse as George Will and Molly Ivins and from politicians as ideologically incompatible as U.S. Reps. Maxine Waters and Richard Pombo. Moreover, as the furor intensified, legislators across the country began introducing bills to rein in the power of local governments to condemn people's homes and businesses. In California the most far-reaching legislation was sponsored by Tom McClintock, the silver-haired Republican state senator from Thousand Oaks. His proposal: an amendment to the state constitution that would ban the use of eminent domain for any private development.
McClintock announced his measure, SCA 15, at a press briefing July 14 at the state capitol. "It used to be," he said, "that if a widow didn't want to sell her home to a developer, she didn't have to. That was the end of the matter, unless the developer sent in a bunch of thugs to beat her up. ... Now, government has become the thug." McClintock's supporters that day included Tom Bittle, director of legal affairs for the Howard Jarvis Taxpayers Association; Mohammed Mohanna, a real estate developer from Sacramento; and Assemblymember Doug LaMalfa, who elicited snickers from reporters when he briefly strayed from his prepared text: "As in The Godfather," LaMalfa said, "if they want to take my property, we're going to make them an offer they can't refuse."
Finally, McClintock introduced Sandefur, who had helped with the bill's drafting.
"Eminent domain is a nationwide epidemic," Sandefur began, trying not to speak too quickly, which is what he tends to do when he's reading from a script. He went on to speak of a Toyota dealership in Kansas that was forced, through the power of eminent domain, to sell its land to a BMW dealership. He also spoke of a blue-collar, immigrant neighborhood in Detroit that was wiped out by General Motors; an elderly woman in Atlantic City whose home was targeted for condemnation by billionaire Donald Trump; and a church in Cyprus, California, that was threatened with extinction by a proposed Costco.
Said Sandefur: "This is a matter of the perversion of government power versus the Constitution. That's why the NAACP, AARP, Ralph Nader, the Pacific Legal Foundation, and others all joined forces to oppose the abuse of eminent domain."
Indeed, the Kelo decision was hugely unpopular. According to one MSNBC poll, a surreal 98 percent of the public disapproved of the ruling. But would the outrage last? And, even if it did, what would that mean for the property rights movement as a whole?
There can be little doubt about the importance of the Pacific Legal Foundation in advancing the property rights agenda. Founded in 1973 by a handful of lawyers who worked together under Ronald Reagan when he was governor of California, its vision was to replicate the success of such advocacy groups as the NAACP and the ACLU, except with a conservative, pro-business agenda.
In its first years, PLF beat back an attempt by the Environmental Protection Agency to control air pollution by restricting automobile traffic in five states, including California. The foundation also won a federal court ruling that permitted the supersonic Concorde jet to land at Washington's Dulles International Airport. And it successfully argued for the use of DDT to save Northwest timber from a moth infestation.
But PLF's big breakthrough in property rights didn't occur until 1987 in a case called Nollan v. California Coastal Commission (483 U.S. 825). In that case, the question was whether a particular regulation was so burdensome that it constituted a taking under the Fifth Amendment of the Constitution. (As the Takings Clause of the Fifth reads, "... nor shall private property be taken for public use, without just compensation.")
Up through the first two decades of the 20th century, it was all very simple: For there to be a taking, there had to be a direct appropriation or invasion of the piece of real estate at issue. But in 1922, in one of Chief Justice Oliver Wendell Holmes's more cryptic opinions, he wrote, "[W]hile property may be regulated to a certain extent, if the regulation goes too far it will be recognized as a taking." (Pennsylvania Coal v. Mahon (260 U.S. 393).)
How far is too far? At the time of Nollan, anyone's best guess would have been based on Penn Central Transportation Co. v. City of New York (438 U.S. 104 (1978)). In that opinion, the U.S. Supreme Court articulated a three-pronged balancing test to determine what is a compensable taking. One of these prongs dealt with the economic impact of the regulation. Another had to do with the degree to which a regulation interfered with the investment expectations of the owner. And the most vaguely worded of the three referred to "the character of the governmental action."
This ad hoc test displeased property rights advocates for a couple of reasons. For one thing, they argued that, for any given case, the test doesn't offer much guidance. For another, in practice it tends to weigh heavily in favor of government action. So what PLF's lawyers hoped to do was prod the courts into articulating some bright-line rules that would box in the regulators. The effort went badly for PLF, at first. In fact, it went so badly that by 1986 some lawyers at PLF were actually thinking of giving up. Then along came Nollan.
In Nollan the California Coastal Commission told the owners of a beachfront property in Southern California that if they wanted to tear down an existing structure to build a larger home, they would have to set aside a strip of their land along the coast for public access. The commission argued that this was consistent with the legitimate government purpose of preserving an unimpeded view of the ocean from the road. However, a 5-4 majority of the high court concluded that mere consistency was not enough. Writing for the majority, Justice Antonin Scalia observed: "Unless the permit condition serves the same governmental purpose as the development ban, the building restriction is not a valid regulation of land use but 'an out-and-out plan of extortion.' " Thus, the Court ruled, there needs to be "an essential nexus" between the condition imposed and the legitimate government interest being pursued.
This was a big win for the property rights side, and it portended even bigger wins down the road. That's because the opinion contained enough means/ends analysis to effectively blur the line between a takings and a due process argument. This blurring even made some people wonder whether the Takings Clause could, in the fullness of time, be used to restore the antiregulatory power that the Supreme Court gave up in the 1930s when it abandoned what was called "substantive due process" in property and economic rights cases for the "rational-basis test."
As a radical libertarian, Sandefur believes that all government efforts to redistribute wealth are both wrong and unconstitutional-whether for health care, child care, or even flood relief. This does not make him particularly representative of PLF, which has always straddled the line between conservatism and libertarianism. But it does make him very interesting to talk to.
Throughout the summer and into the fall of 2005, I had several long conversations with Sandefur. During these encounters, which often seemed like philosophical jam sessions as much as formal interviews, he spoke with great enthusiasm about the ideas that animated Jefferson, Madison, and Locke. He also talked a little bit about himself.
"I was a horrible kid," he confided one afternoon at his office in Sacramento. "I was a brat and a nonconformist. I was a bully at first. Then I was always breaking the teachers' rules. I got terrible grades in school, had no friends, and probably had the lowest self-esteem of anyone I knew. And then in my junior year of high school I started to clean things up a bit."
What accounted for the change? Sandefur says it had a lot to do with reading The Fountainhead-Ayn Rand's famous novel about an architect who preferred to blow up a building of his own design rather than see it compromised by someone else's vision. For Sandefur, the essential message was "that idealism can make a difference." Since then, Sandefur has read practically everything Rand has published, and in the process has come to embrace her quasi-Nietzschean views. Sandefur is also a big believer in both natural law and substantive due process, which he spoke about at length at USF.
"When I talk about economic liberty and the law," he told the students, "the big case everybody throws out is the 1905 Supreme Court case Lochner v. New York" (198 U.S. 45). "And when I say 'Lochner,' everybody is supposed to boo and hiss. But I think Lochner was rightly decided, and the reason is a little bit complicated for a brief presentation, but I'll do my best.
"First of all, New York had passed a law that prohibited bakers from working more than ten hours a day on the theory that prohibiting them from working overtime would somehow improve their lot. Joseph Lochner was fined for violating that law by allowing an employee to work overtime, and the New York state courts upheld the conviction. But then the Supreme Court overturned the conviction-on the ground that the law deprived Lochner and his employees of the liberty to earn a living, without due process of law. Now the whole issue behind Lochner v. New York is what is meant by due process. Is it due process if the legislature merely passes a bill? Or are some laws prohibited by the Constitution regardless of how they're passed? Substantive due process says government is created for a reason. And that reason, according to political philosophers like John Locke, is to prevent bullies or their elected representatives from beating people up and taking their things. Due process, therefore, has to contain a substantive component.
"Now after Lochner there was a big swing in favor of the Progressives, then the New Dealers. So these days when the government deprives you of your economic freedom, your right to earn a living, your right to pursue happiness, the Supreme Court says it only has to be rationally related to a legitimate government interest. Let me tell you something: There are only two things you need to know about the rational-basis test. One, it doesn't have to be rational, and two, it doesn't need to be the basis. As long as some nondrunk person could have voted for the law, it passes the test.
"Lochner stands for the fundamental principle that government exists to protect us in our rights. It does not exist to take things from people who earn them and give them to people who do not. It does not exist to give special favors to the politically favored at the expense of those who cannot persuade the government to do their bidding. In Lochner v. New York, the law made it illegal to work overtime if you're a baker. Why? Not for any public reason, but simply to satisfy the interests of socialists, so they could sit home and say, 'Ahh, bakers can't work overtime. Thank God.' But who pays the baker who wants to work overtime but now can't? Let's say he used to make $15 a week and now makes only $10. Who gives him the extra $5? Nobody. Who compensates inner-city kids because we make it so expensive through minimum-wage laws to hire inner-city kids? Nobody. Yet the people who pass these laws sit back and call themselves compassionate. "People who win in a competition of interest groups and in the lobbying contests are the rich and powerful, the politically connected. The more power you give government to redistribute wealth, the less you give to people who live in the inner cities, to working-class people, to people who have to work for a living rather than go and persuade city councils to do things for them. Liberty helps us all, and it helps the poor most of all because they don't have political power. They have to rely on the Constitution."
About a year before Nollan, Richard A. Epstein, a law professor at the University of Chicago, published a book that took the academic world by storm. Called Takings: Private Property and the Power of Eminent Domain, it argued for a bold new era of judicial activism. Zoning, rent control, minimum-wage laws, environmental laws, social welfare programs, and even progressive taxation-all were takings as far as Epstein was concerned. And that would make the Takings Clause every bit as effective a club against big government as due process ever was.
Within academic circles, this densely written book drew unusually fierce criticism. "Like a scruffy dog," wrote one law professor, "this is a book that will tempt every passerby to give it a kick. Its philosophy is little more than assertion, its approach to constitutional analysis is unrecognizable, and its conclusions are stupefying."
But Takings had its fans too. Among them were the editors of the Wall Street Journal, who named it one of the ten best books of 1985. Epstein also appeared to have gotten a very sympathetic read from those in the Reagan administration. Charles Fried, who was solicitor general from 1985 to 1989, later wrote that it was under Epstein's influence that many in the Justice Department sought to use the Takings Clause "as a severe brake upon federal and state regulation of business and property." Epstein's influence even seemed to extend to the attorney general himself.
"[H]onest attempts to interpret the Takings and Contract Clauses of the Constitution should not be disdained as mere 'Lochnerizing,' as some have characterized them," Edwin Meese said in a speech before an economic liberties conference in June 1986. "We must recognize that certain economic rights do exist and are central to the American constitutional order. They are well supported in both the text and the history of the Constitution, and deserve full and fair consideration. ...Within each, a revolution in, or perhaps more accurately, a revisiting and restoration of, economic liberty is a prospect."
Two years later, on the heels of the Nollan decision, the Reagan administration issued Executive Order 12630, which required government decision makers to "evaluate carefully the effect of their administrative, regulatory, and legislative actions on constitutionally protected property rights."
By the early 1990s the property rights movement looked stronger than ever, particularly after Clarence Thomas-who had made a number of speeches endorsing the aggressive protection of property rights-joined the Supreme Court. Indeed, before the Anita Hill controversy broke, the most notable moment in Thomas's 1991 confirmation hearings was when Sen. Joseph Biden, chair of the Senate Judiciary Committee, held up a copy of Takings and asked the nominee if he endorsed Epstein's views. (Thomas, in response, allowed that as a matter of political theory he supported many of Epstein's ideas but insisted there was an important distinction between political theory and adjudication.)
The next year, in one of his first cases on the Court, Thomas ruled with the majority in Lucas v. South Carolina Coastal Council (505 U.S. 1003 (1992)) that if a regulation eliminates all of the economically beneficial uses of a piece of land (short of physical invasion) it's a per se taking without any need to apply the Penn Central balancing test.
Then, in Dolan v. City of Tigard (512 U.S. 375 (1994)), the Supreme Court extended the logic of Nollan by ruling that not only must there be an "essential nexus" between an imposed burden and a legitimate government interest, but also that the burden must be "roughly proportional" to the projected impact of the project. And in 1997, property rights advocates scored another victory in Suitum v. Tahoe Regional Planning Agency (520 U.S. 725)-a case that, perhaps more than anything else, demonstrated PLF's knack for picking extremely sympathetic clients: The plaintiff, Bernadine Suitum, was a half-blind, octogenarian widow who on the day of oral arguments was wheeled into the chamber by her son.
Given the Court's makeup at the time, not to mention the political climate, property rights advocates had good reason to be optimistic. But the next few years saw a shift in the Court's direction.
The first big indication of this occurred in 2002 with Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency (535 U.S. 302). The question was whether a 32-month moratorium on development amounted to a per se Lucas taking.
At one critical point in the oral arguments, Justice John Paul Stevens pressed the petitioner's attorney, Michael M. Berger of Manatt, Phelps & Phillips in Los Angeles, on the meaning of a temporary taking.
Stevens: "[O]f course, the physical taking even for 10 minutes would be a taking. There's no doubt about that. But your view is, even if the regulation prohibits all use of a piece of property, an automobile, whatever it may be, for 10 or 15 minutes, there is a taking."
Berger: "If there is a total prohibition of use."
Stevens: "For 10 minutes."
Berger: "... [T]here is liability."
By 2005 the reversal was complete. It was a curious turn of events; one possible explanation was that the justices, contemplating the profound implications of where they were heading, simply lacked the nerve to go any further. Another explanation is that Justice Scalia's uncompromising style tended to work against lasting coalitions.
Speaking at the Chapman Law School last summer, Sandefur managed to rile a few students when, during the question-and-answer period, the discussion wandered onto the topic of gay marriage. Ever the consistent libertarian, Sandefur suggested that gays should pretty much be allowed to do what they want with their private lives. Then one student countered that homosexuality isn't natural. "Is wearing clothes natural?" Sandefur asked. "But homosexuals can't have children," said another. "Hey, wait a minute," said Sandefur, "is kissing natural? How about infertile couples? Were George and Martha Washington violating natural law every time they slept together?"
From there, the conversation only grew more graphic, with one student wondering aloud how anal sex could possibly be considered natural. Finally, the student who seemed the most agitated suggested that Sandefur should be more careful with his comments. "We're the only friends you have," he said. "Well put," Sandefur smiled.
The exchange underscores the often-glossed-over tensions that exist between libertarians and conservatives. But in my conversations with Sandefur, a different question kept coming up: Should government ever be in the business of taking things away from people to give them to others?
QUESTION: Was there ever a government redistribution program that could be called an unambiguous success?
SANDEFUR: No. Whenever there's redistribution, we're taking capital that ought to be invested in an efficient way by individual investors and spending half of it on bureaucrats, and the other half we're giving away to people who don't earn it.
Q: How about the GI Bill after World War II? Wasn't that an unambiguous success?
S: Well, certainly it wasn't unambiguously successful.
Q: But even if it was a success, you don't believe it was just?
S: If it commits an injustice, it's not successful by any meaningful definition of the word success. How can you divorce success from justice? For a success to be real, it would have to be just.
Q: How about when there's a need for providing food and water and insulin after a catastrophic flood? I don't think many people would question the proposition that government has a legitimate role to play in such circumstances.
S: No. Except for deterring looting and such, I don't think government has a legitimate role to play. And I don't think government has a practical role either. Government is consistently inept at these things. It always fails. Real relief comes from private organizations. It's been a favorite rhetorical technique of collectivists, since at least the days of Charles Dickens, to claim that the free market is cold and heartless and uncharitable. Of course, that's silly. Free societies are breathtakingly charitable. As Milton Friedman points out, all of the greatest charitable institutions in America were founded during the so-called age of the robber barons. The Salvation Army, the YMCA, even the SPCA, were all founded in the 19th century.
Q: So even when minutes and hours can mean the difference between life and death, you think people would be better off without government intervention?
S: Probably.
Q: Probably? There's an element of doubt?
S: Well, of course there's an element of doubt in everything anybody says. But I would say extremely likely.
Q: Do you believe that the poor in some fundamental sense deserve their fate?
S: In a free society? Absolutely. They "deserve" their fate as much as anyone in the world can ever "deserve" their fate. It's true that, for those born into poverty and broken homes, the road is a lot harder-and thanks to government intervention in the economy and social life, it is vastly harder for them than it would be in a free society. Yes, luck matters in a free society, but even bad luck is much fairer than having your fate and your choices made for you by some bureaucrat. More important, though, is the question of justice. Obviously, some people have it harder than I. But that doesn't mean it is somehow my duty to devote my life and energy to serving their wants and needs. You ask if the poor deserve their fate in a free society. I would ask you if people deserve their fate in an unfree society, when their earnings and their homes and businesses are taken away to give to other people because they're more politically popular.
Q: Let's suppose for a moment we could look into a crystal ball and see what a pure laissez-faire economy would be like. And suppose what we find is a society torn by social strife, where the rich keep getting richer and the poor keep getting poorer and the armed forces have to be called in to keep the desperate mobs in check. Suppose, too, that we could look into another crystal ball and find a slightly less pure laissez-faire economy, where the rich aren't quite so rich, but the poor aren't nearly so poor, and the middle is better able to get by. Now I know you don't think it would go that way. But let's suppose it did. Of the two societies, which one would a reasonable person choose?
S: The problem with your "what if" is that you're asking me to ignore everything we know about how the economy and private property works. It's like asking, What if I dropped a rock and, rather than falling to the ground, it just hovered in midair? Such an observation would require us to reexamine all of our previously known laws of nature. But at this point there is so much evidence and so much well-established theory to support the conclusion that capitalism results in a better standard of living for everyone, that it's virtually impossible to imagine what you're imagining.
Last May, three years after Tahoe-Sierra, the Supreme Court ruled in Lingle v. Chevron that a regulation does not constitute a taking simply because it fails to "substantially advance a legitimate state interest." This phrase came from an opinion that Justice Louis Powell wrote back in 1980, in a takings case called Agins v. City of Tiburon (447 U.S. 255). Although the property owners lost that one, it might still have been a huge victory for property rights had it resulted in the establishment of a stand-alone "substantially advance" test blurring the line between takings and due process. The Court had already gone a long way toward doing just that in its Nollan ruling. However, in Lingle the Court, by a 9-0 vote, unequivocally declared that such a test has no place in takings litigation. As Justice Sandra Day O'Connor observed, "[T]his test does not help to identify those regulations whose effects are functionally comparable to government appropriation or invasion of private property; it is tethered neither to the text of the Takings Clause nor to the basic justification for allowing regulatory actions to be challenged under the Clause."
Thus, after Lingle, only two bright-line tests remained in takings litigation, and both were being defined so narrowly that they were of little practical value. One, based on Lucas, says a taking occurs when all economic use of a property is eliminated. And the other, based on a ruling in 1982, Loretto v. Teleprompter Manhattan CATV Corp. (458 U.S. 419), involved only cases in which there is an actual physical occupation. That consigns the vast majority of regulatory takings cases to the Penn Central test-the legal straightjacket that property rights advocates had tried so hard to break out of.
Also in 2005, the Court in San Remo v. City and County of San Francisco barred the vast majority of takings claimants from ever making it to federal court. It did so by ruling that they have no right to relitigate at the federal level once they've lost in state court.
So it really was a terrible year for the property rights movement. But then came Kelo.
Unlike Lingle, San Remo, and Lucas, which were regulatory takings cases, Kelo involved the direct condemnation of property. In Kelo there was never any doubt that the displaced would be compensated. Rather, it involved people who did not want to leave their property for any reasonable price. Under the Fifth Amendment, the government clearly has a right to condemn someone's home to make way for a highway or a bridge. But could that same power be used to promote private development? And when the Constitution says "public use," can it be read as "public benefit"?
In 1954 the Supreme Court answered these questions in the affirmative when it upheld a redevelopment plan in an extremely run-down part of Washington, D.C., over the objections of one of the business owners in the area, who argued that his particular store wasn't blighted. This decision (Berman v. Parker, 348 U.S. 26) gave the green light to scores of urban redevelopment projects across the country-projects that often dramatically improved the financial health of communities but did not necessarily benefit the poor people they displaced. In fact, in many communities the urban renewal that was common during the 1950s and '60s came to be known as "Negro removal." And it wasn't until the 1980s, when states started to pass laws requiring redevelopment agencies to spend a substantial amount of money on low-income housing, that the poor started to do better.
In the 1980s, however, a new kind of eminent-domain abuse began to be reported. In these cases, large companies were able to take blatant advantage of their political clout to uproot well-established, nonblighted communities. General Motors was among the first to be implicated, in the infamous Poletown case, in which more than a thousand Detroit homes were demolished to clear the way for a new Cadillac assembly plant. (In 1981 the Michigan Supreme Court upheld the plan.) Then big-box retailers such as Costco and Wal-Mart began to throw their weight around. And Donald Trump got a lot of press when he tried to force an old woman out of her home to build a limousine parking lot.
But it was Kelo that brought the outrage to a head. As Justice O'Connor observed in her dissent, "The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz Carlton, any home with a shopping mall, or any farm with a factory."
Seven days later, by a vote of 365-33, the U.S. House of Representatives passed a resolution expressing its disapproval of the majority opinion in Kelo. Then, in quick succession, three states-Alabama, Delaware, and Texas- enacted laws restricting the use of eminent domain. By the end of the summer another 25 state legislatures had bills pending on the matter.
In California, where a total of nine eminent-domain bills were filed in 2005, the debate quickly boiled down to a choice between two different approaches. The first was to impose a five-year moratorium on the taking of residential property for private use, to allow time to study the issue. The second approach-spearheaded by McClintock-called for permanently banning the use of eminent domain for any condemnation involving private development. To some, the moratorium proposal seemed like a delaying tactic meant to wait out the public furor. To others, the idea of a ban was akin to throwing out the baby with the bath water, particularly because California already requires a blight finding for condemnations.
On August 17, a couple of experts from the redevelopment side spoke against McClintock's bill at a state Senate subcommittee hearing in Sacramento. One was Bill Higgins of the Institute for Local Government, a nonprofit affiliated with the League of California Cities. "A lot of concern in Kelo has been focused on the loss of a single-family home," he told the subcommittee. "But eminent domain is really important to how we're building our state's infrastructure. As we all know, California is taking on 600,000 new residents a year. And how we serve them, how we provide schools and other necessary public services, isn't always as neat and tidy as condemning for a road."
Higgins went on to talk about Emeryville, where the power of eminent domain was used to clean up a contaminated area so that retail shops and affordable housing units could be built. He also spoke of a developer in Pacifica who, after purchasing a HUD-financed affordable-housing project, tried to evict the 100 seniors living there. The city was able to stop him, Higgins said, by condemning the property, then turning it over to another developer who allowed the seniors to remain. "We have stories on both sides of the issue," Higgins observed. "And what we need to do is really study it and have a measured response before we do anything."
Sandefur also testified that day and expressed a very different viewpoint. "Eminent domain is one of the most extreme forms of government coercion," he said. "I have never met someone who said, 'Well, thank goodness they took my home or business away through eminent domain!' The unfairness under California and federal eminent-domain law needs serious attention now."
As it turned out, no eminent-domain bill made it out of committee in 2005. But the issue was hardly going away. Not with McClintock around, promising to collect enough signatures to put his proposal on the November 2006 ballot-just in time for the run he's making for lieutenant governor.
For all their devotion to property rights, the 23 lawyers now working at PLF do not speak with one voice. For example, the foundation's current president, Michael A. Grob, a soft-spoken, congenial man, seems more inquisitive than opinionated. (During one of my visits, we ended up talking at length about Jared Diamond's best seller Guns, Germs and Steel, a book that, in explaining why some societies are more technologically advanced than others, has virtually nothing to say about property rights.) M. David Sterling, on the other hand, is a PLF old-timer with a more noticeable ideological edge-especially when he's talking about environmentalists who put "critters" above the interests of people. And then there's J. David Breemer, a surfer who traveled extensively before settling in Sacramento. "I used to be a more radical libertarian," he told me. "But some extreme forms of libertarianism would limit government further than I would now be in favor of."
Why the change? I asked.
"I got married," he explained. "I had kids. I don't think just about myself anymore. So I've come to appreciate the need for government to provide some level of protection and stability. For example, when kids go to school, there's a need to protect their health, and that means making sure they all get their vaccinations. Now, a radical libertarian would say that, without it being purely voluntary, that is no legitimate role for government. But kids have to have their shots."'
When I later thought about that conversation, it occurred to me that Sandefur himself will probably go through some changes in the coming years that he hasn't anticipated. Marriage, for one thing, will no doubt have an impact. (At this writing, he has a fianc'ee but has not set a wedding date.) He also recently made a down payment on his first home. But when I suggested he might eventually outgrow the ideology he now holds so dear, he laughed contemptuously. "Well, someday I will grow old and I will lose my mind, and I will be satisfied with poor arguments and shoddy theory," he declared.
Weeks later, in one of our last conversations, I pushed a little harder. "You know," I said, "I have a sense that the ideology we end up with has much less to do with intelligence or reason than with temperament and experience. Don't you think, if you had a different temperament and a different set of experiences, you'd be smart enough to find the logic to justify a very different point of view?"
"I suppose so," he answered. "But that wouldn't make it right."
Martin Lasden (martin_lasden@dailyjournal.com) is a senior editor at California Lawyer.
#259257
Martin Lasden
Daily Journal Staff Writer
For reprint rights or to order a copy of your photo:
Email
jeremy@reprintpros.com
for prices.
Direct dial: 949-702-5390
Send a letter to the editor:
Email: letters@dailyjournal.com