Property Rights

Is Congress Violating the Constitution to Enforce It?

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Yesterday the House Agriculture Committee approved a bill that would deny federal economic development grants to projects that involve the use of eminent domain "to obtain property for private commercial development." Unlike the Bond Amendment, which Congress approved in 2005, this bill, known as the Strengthening the Ownership of Private Property Act of 2007, seems to have real teeth. The Bond Amendment, as the American Planning Association happily noted, "contains exemptions [including one for "blight"] that will allow most projects to move forward." The new bill (a version of which was overwhelmingly approved by the House last year) includes just these exceptions:

(A) for use by a public utility;

(B) for a road or other right of way or means, open to the public or common carriers, for transportation;

(C) for an aqueduct, pipeline, or similar use;

(D) for a prison or hospital; or

(E) for any use during and in relation to a national emergency or national disaster declared by the President under other law.

But here's a tricky question for limited-government types who believe in respecting the entire Constitution, not just the Fifth Amendment's requirement that government take property through eminent domain only for "public use," a requirement the Supreme Court has reinterpreted as a an all-purpose license to redistribute land. Does the proposed limit on federal economic development grants (which, it should be noted, are not constitutionally authorized to begin with) improperly trespass on the states' authority to set their own eminent domain policies (within the accommodating parameters set by the Supreme Court)? Is this bill analogous to, say, the highway funding threat that pressured every state to raise its drinking age, and therefore objectionable on similar federalist grounds? Does the motive—in that case, restricting rights; in this case, protecting rights—make all the difference?

I am sympathetic to the view that Congress is stepping in to enforce constitutional rights the Supreme Court has allowed to be trampled. Supporters of the federal restrictions on lawsuits against gun manufacturers made a similar argument vis-à-vis the Second Amendment. In that case, I thought the threat was too remote to justify federal interference with state tort law. With eminent domain, by contrast, the threat is not at all hypothetical, since takings in the name of economic development are happening all the time. Is there a sound constitutional reason why Congress should continue subsidizing them? I think I've pretty much convinced myself that the grant restrictions are OK, but maybe you can talk me out of it. 

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  1. I’d say this is on better federalist grounds that the drinking age policy because it is directly relevant to the project being funded by the feds. I’d rather the feds didn’t make the grants, but that’s a whole different battle. In contrast, the drinking age has little if anything to do with how the highway funds are spent, so it’s a pretty clear overstep.

    If the eminent domain restrictions weren’t appropriately narrow, for example, if the bill required the state to change its policies in development projects that the federal government wasn’t funding to get the money, there would be a much stronger federalism-based case against it. The bill seems to strike about the right balance.

  2. Since private parties, rather that state & local governments, fund the federal fisc, I’m not sure why the latter should be allowed to avail themselves of the unconstitutional conditions doctrine (the typically basis for challenging “strings attached” appropriations) on an equal footing with bona fide taxpayers.

  3. I’m not really seeing how this would be infringing on the right of the individual states to set their own eminent domain policies; from what I understand it’s just limiting grant funding from the Feds. I don’t see why states should have the right to federal grants for state projects (such as an eminent domain proceeding not covered by these exemtions). As long as they aren’t simply removing state’s rights to use eminent domain how they see fit, the bill doesn’t seem to be overstreching it’s reach.

  4. You are blaming SCOTUS for being consistent in its assessment of property rights by suggesting that they should make a distinction between roads, railroads, hospitals, schools, etc. and private development. Especially in the cases of railroads and hospitals, there is no fundamental difference if they are for-profit, or non-profit in some circumstances. What if state governments use eminent domain to build a highway that they immediately sell or lease to private investors? What’s the difference? It appeals to the economically nebulous notion of needs vs. wants.

    The nice thing about this legislation is that it prevents the subsidization of private development that we don’t think should be subsidized.

  5. I’m with you on this on Jacob. I like what they’re trying to do here, but I could be persuaded that the bill would be improved if it were changed to “deny federal economic development grants”.

  6. I don’t think since congress doesn’t have the authority to give these grants in the first place, the federalism issue is moot…any reduction of grant money from the feds to the states is by definition more federal since the feds are exercising a power they don’t have less than they were before.

  7. The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved for the States respectively, or to the people.

    Given that this has never been read as “nor prohibited by the Constitution to the States” (or we wouldn’t have spent a century or two before getting to the incorporation of many rights), it’s reasonable to assume that it means “nor prohibited by the United States to the States”.

    I sincerly doubt there are any Constitutional or ethical issues from the libertarian camp on limitations to the powers of a government, no matter where they come from.

  8. Sorry that should be “I think” not “I don’t think”

  9. How are grant restrictions in any way objectionable?

    They don’t stipulate how a State spends its money.

    They don’t even apply to the whole state, just to individual projects. So, a State can skip funding for one project, but accept it for another.

  10. Is Congress Violating the Constitution . . .

    Yes, it is. Just how doesn’t really interest much anymore, frankly.

  11. “Federalism” isn’t defined as the belief that the national government should be powerless vis a vis the states. It’s the belief that the federal government and the states have their own rightful areas of authority.

    If the federal govenrment has the authority to fund or not to fund economic development projects (or highway projects), then it has the authority to decide which ones it wants to fund, and to put conditions on that funding. Only if the condition itself violates the Constitution – if Congress and the executive branch use, for example, the states’ willingness to quarter soldiers in private homes during peacetime as a condition for sending them highway grants – is it unconstitutional for the feds to condition their grant programs.

    Seems to me that both the highway funds/DUI limit issue, and this takings issue, are policy questions, not constitutional questions.

  12. Hey everyone! How’s it hanging?

  13. I have to agree with Joe here.

    The question is silly to begin with, as the government is violating the constitution to make the grants in the first place. However, if we’re ignoring that and asking if there is some further violation, obviously there isn’t.

    To announce that entities engaging in some action will forgo a benefit you might otherwise provide is not coercion. It is manipulative, for sure, but so is any system of rewards and incentives.

  14. Isnt the constitution a living document anyways?

  15. If this is a restriction on an existing program, than whether the program should exist at all may be a worthy argument, but it is a separate one from whether it hould not be used for eminent domain takings. If this is a new program, than justifying it on the basis of discouraging such takings is no argument for it at all.

  16. Supporters of the federal restrictions on lawsuits against gun manufacturers made a similar argument vis-?-vis the Second Amendment. In that case, I thought the threat was too remote to justify federal interference with state tort law. With eminent domain, by contrast, the threat is not at all hypothetical, since takings in the name of economic development are happening all the time.

    OTOH the takings by New York governments of properties in New York State (for instance) don’t affect owners of property in Texas.

    A lawsuit filed in New York that shuts down a Connecticut gun manufacturer so Texas gun shops can no longer carry their product, and imposes regulations that a Florida manufacturer must pass on to a Louisiana wholesaler supplying firearms to Texas gun shops, would in fact affect Texans. It would then legitimately fall under the Interstate Commerce clause, particularly since it would only take one court in one unregulated state to affect purchasers in all fifty states.

    BTW, we still have state judges allowing firearm strict liability lawsuits to proceed, despite the passage of the legislation.

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