Adverse consequences of Supreme Court decision on takings
Principal of eminent domain trumps individual rights
By George W. Mantor
The Supreme Court recently issued its decision in the long awaited eminent domain case of Kelo v. The City of New London, Connecticut in which homeowners were attempting to stop the city from taking their homes to make way for a private development project involving a hotel, condos, and offices.
The court ruled that economic development, i.e., profit and progress, are more vital to the American fabric than the concept that a man's home is his castle.
Meet the new king, same as the old king. This misguided decision reeks of imperialism and further underscores the disconnect between the elitists who have seized control of our country and the citizens on whom they inflict their vision of world order.
Eminent domain law asserts that governments should be able to take the real property of citizens, for just compensation, if the property is needed for the public good such as a hospital, library or park.
But the vagueness of what constitutes the "public good" and what is "just compensation," have continued to pit competing interests against each other and have led to heartbreak and despair for many Americans who learned the hard way that you can't fight City Hall or Capitol Hill.
The right to own property would seem to be the ultimate personal freedom, well beyond the value of free speech. If governments can take away the real property of citizens, the right to complain about it isn't much of a consolation.
Individual real estate owners control only a very small percentage of the land in America, so a strong argument could be made that alternatives could easily be found. But many times developers simply want to take advantage of what existing owners have been improving for decades.
What twisted logic would lead to the predicament in which owners of more desirable property would be at greater risk of a taking? Watch out if you own waterfront property. Developers love waterfront. From hotels to industrial parks, from timeshares to casinos, they all know that waterfront property brings the highest return per square foot.
The potential for abuse is obvious. I've seen enough to know that no matter how lofty the espoused ideals of many politicians, if you wave enough money or hookers under their noses, they'll fold-up like a cardboard suitcase and someone's ancestral home is going to be replaced by a Wal-Mart or a strip joint.
Most eminent domain cases boil down to how we as individuals value different aspects of life. Some value money and power, others value family and friends, while others still value peace and fulfillment. When the seeker of money and power is thwarted by the preserver of the status quo, the government should remain neutral and let the principals resolve their own issues.
Money isn't always just compensation if it's a family home, unique property, or tied to one's business or livelihood. Like most really bad decisions made by government officials, little thought has been given to the unintended adverse consequences that will surely follow:
1. Market values will decline. Market value requires free negotiation. If the developer no longer has to negotiate with a property owner, why should he? It's cheaper to bribe an official.
2. Gentrification will be impaired. The first investors in blighted areas are usually small investors. They will be wary of the possibility that once an area is revitalized, bigger businesses can force them out.
3. Corruption will increase. Officials sell out so cheaply that it's hard to imagine a developer willing to negotiate fair market value when a few thousand dollars under the table will net a far lower acquisition price.
4. More litigation. The stakes will be higher for property owners and they will lawyer-up earlier in the process and make every step of the development process difficult and protracted. Lawyers will, as always, be the other class of winners in this transfer of wealth.
5. Confusion. The Supreme Court had the opportunity to clarify what has been ambiguous and confusing legislation in this area of property rights but instead did the opposite.
6. No good can come of it. It will lead to bad Karma and despair. Cities that take the assets of others to solve economic problems must surrender their souls.
The very idea smacks of the worst in us, and makes everything about money. What is the value of the trees planted by your great grandfather or the view from the kitchen window?
Is this really reflective of our national values? Is economic development more important than family, history, security, and justice? We don't need a Supreme Court judge to say its okay. We know in our hearts that it is wrong, mean spirited, and ultimately self destructive. As a lifelong property rights activist, I believe that the justices are constitutionally out of bounds on this one, and we all need to stand up for one another and fight back.
It's time to take back our towns, our states, and our borders and say to career politicians and their appointed lackeys, we've seen enough.
George W. Mantor is known as "The Real Estate Professor" for his consumer education show on AM 1000 KCEO, "Keepin’ It Real, real talk about the real thing, real estate!”, Tuesday mornings, 7, 8 am. He possesses over 25 years in the industry and is founder, president, and CEO of The Associates Financial Group, an independent, locally-owned, full service real estate and mortgage brokerage, headquartered in Carlsbad, California and dedicated to developing long-term relationships with clients (www.myafg.com).
Principal of eminent domain trumps individual rights
By George W. Mantor
The Supreme Court recently issued its decision in the long awaited eminent domain case of Kelo v. The City of New London, Connecticut in which homeowners were attempting to stop the city from taking their homes to make way for a private development project involving a hotel, condos, and offices.
The court ruled that economic development, i.e., profit and progress, are more vital to the American fabric than the concept that a man's home is his castle.
Meet the new king, same as the old king. This misguided decision reeks of imperialism and further underscores the disconnect between the elitists who have seized control of our country and the citizens on whom they inflict their vision of world order.
Eminent domain law asserts that governments should be able to take the real property of citizens, for just compensation, if the property is needed for the public good such as a hospital, library or park.
But the vagueness of what constitutes the "public good" and what is "just compensation," have continued to pit competing interests against each other and have led to heartbreak and despair for many Americans who learned the hard way that you can't fight City Hall or Capitol Hill.
The right to own property would seem to be the ultimate personal freedom, well beyond the value of free speech. If governments can take away the real property of citizens, the right to complain about it isn't much of a consolation.
Individual real estate owners control only a very small percentage of the land in America, so a strong argument could be made that alternatives could easily be found. But many times developers simply want to take advantage of what existing owners have been improving for decades.
What twisted logic would lead to the predicament in which owners of more desirable property would be at greater risk of a taking? Watch out if you own waterfront property. Developers love waterfront. From hotels to industrial parks, from timeshares to casinos, they all know that waterfront property brings the highest return per square foot.
The potential for abuse is obvious. I've seen enough to know that no matter how lofty the espoused ideals of many politicians, if you wave enough money or hookers under their noses, they'll fold-up like a cardboard suitcase and someone's ancestral home is going to be replaced by a Wal-Mart or a strip joint.
Most eminent domain cases boil down to how we as individuals value different aspects of life. Some value money and power, others value family and friends, while others still value peace and fulfillment. When the seeker of money and power is thwarted by the preserver of the status quo, the government should remain neutral and let the principals resolve their own issues.
Money isn't always just compensation if it's a family home, unique property, or tied to one's business or livelihood. Like most really bad decisions made by government officials, little thought has been given to the unintended adverse consequences that will surely follow:
1. Market values will decline. Market value requires free negotiation. If the developer no longer has to negotiate with a property owner, why should he? It's cheaper to bribe an official.
2. Gentrification will be impaired. The first investors in blighted areas are usually small investors. They will be wary of the possibility that once an area is revitalized, bigger businesses can force them out.
3. Corruption will increase. Officials sell out so cheaply that it's hard to imagine a developer willing to negotiate fair market value when a few thousand dollars under the table will net a far lower acquisition price.
4. More litigation. The stakes will be higher for property owners and they will lawyer-up earlier in the process and make every step of the development process difficult and protracted. Lawyers will, as always, be the other class of winners in this transfer of wealth.
5. Confusion. The Supreme Court had the opportunity to clarify what has been ambiguous and confusing legislation in this area of property rights but instead did the opposite.
6. No good can come of it. It will lead to bad Karma and despair. Cities that take the assets of others to solve economic problems must surrender their souls.
The very idea smacks of the worst in us, and makes everything about money. What is the value of the trees planted by your great grandfather or the view from the kitchen window?
Is this really reflective of our national values? Is economic development more important than family, history, security, and justice? We don't need a Supreme Court judge to say its okay. We know in our hearts that it is wrong, mean spirited, and ultimately self destructive. As a lifelong property rights activist, I believe that the justices are constitutionally out of bounds on this one, and we all need to stand up for one another and fight back.
It's time to take back our towns, our states, and our borders and say to career politicians and their appointed lackeys, we've seen enough.
George W. Mantor is known as "The Real Estate Professor" for his consumer education show on AM 1000 KCEO, "Keepin’ It Real, real talk about the real thing, real estate!”, Tuesday mornings, 7, 8 am. He possesses over 25 years in the industry and is founder, president, and CEO of The Associates Financial Group, an independent, locally-owned, full service real estate and mortgage brokerage, headquartered in Carlsbad, California and dedicated to developing long-term relationships with clients (www.myafg.com).