Eduardo Peñalver on the Kelo case and my book "The Grasping Hand"

Cornell Law School Dean and prominent property law scholar Eduardo Peñalver's has posted a thoughtful review of my book The Grasping Hand: Kelo v. City of New London and the Limits of Eminent Domain. I am grateful to Dean Peñalver for his in-depth analysis of the book, and his praise of several aspects of it, particularly since we come at these issues from very different perspectives. In many ways, this is exactly the sort of debate I hoped to stimulate by challenging the conventional wisdom about Kelo among legal scholars.

Not surprisingly, I disagree with several of the points Peñalver makes. Here, I focus on two of the most important: the original meaning of "public use" in the Fifth Amendment, and the real-world effects of eminent domain.

In my book, I argue that the historical evidence strongly supports a narrow interpretation of "public use" under which the government can only take private property if it is used for a state-owned project, or for a private enterprise that has a legal obligation to serve the entire public (e.g.—a public utility). One important piece of evidence that I relied on is that by the time the Fourteenth Amendment made the Bill of Rights applicable against state governments in the 1860s, a large majority of the state supreme courts that had addressed the issue, had interpreted "public use" narrowly.

Peñalver worries that this was not a large enough majority to ensure ratification of the amendment by the required three-fourths supermajority of state legislatures. Perhaps not. But it is unlikely that any state legislature otherwise inclined to ratify the Fourteenth Amendment would have refused to do so merely because of disagreement with the majority interpretation of public use at the time. After all, the Fourteenth Amendment included many more prominent elements than this one, and—particularly for Republican-controlled legislatures in the North—it would have been difficult to reject the most important political objective of their party merely because of concern over this comparatively secondary issue.

Moreover, the interpretation of public use by state supreme courts is far from the only evidence that supports a narrow interpretation of the original meaning of public use, not only as of 1868, but also at the time of the Founding. No one piece is by itself decisive. But cumulatively, the evidence for a narrow interpretation far outweigh that supporting the alternative. In the book, I also argue that a relatively narrow interpretation of public use is supported by several leading versions of living constitution theory.

Peñalver quite properly raises the issue of how originalists should handle situations like this one, where both sides have at least some plausible historical evidence on their side. This is a huge issue that I could not fully address in my book. But I did not neglect it entirely. In Chapter 2, I suggest that originalists should favor whichever side has a greater cumulative weight of evidence. An alternative approach would, in effect, bias judicial reasoning in favor of the government, by upholding challenged laws unless there was no reasonably plausible constitutional defense for them. However, this would require originalists to bite some very painful bullets, including admitting that school segregation laws and laws banning interracial marriage are constitutional (there are at least reasonably plausible originalist defenses of both).

Peñalver also worries that I have relied on a libertarian framework that mostly assumes rather than proves that blight and economic development takings like that upheld in Kelo cause more harm than good. He is right to note that we don't have anything approaching a comprehensive data base of takings and their effects, and that this limits the conclusions that can be drawn. But, as I describe in the book, since a broad interpretation of public use became dominant in the 1940s and 50s, such takings have forcibly displaced many hundreds of thousands of people (most of them poor and minorities), and large numbers of small businesses, and other institutions. That harm is so enormous that it is highly unlikely it could be outweighed by any plausibly imaginable benefits. Moreover, as I discuss in Chapter 3, both empirical evidence and economic analysis strongly suggest that the standard "holdout problem" rationale for economic development takings is greatly overstated. For these reasons, I don't think you have to be a libertarian to conclude that giving government a blank check to engage in economic development takings is likely to destroy more value than it creates.

Finally, Peñalver's thoughtful review raises some big-picture issues about the potential for cooperation between liberals and libertarians, of the sort that occurred in the backlash against the Kelo decision. This is a hugely important issue that probably deserves a book of its own. For now, I will only say that, like Penalver, I am guardedly optimistic that such cooperation could extend to other issues where government intervention both undermines economic freedom and harms the poor and disadvantaged.

Indeed, the potential for cooperation might be even greater than Peñalver suggests, because he is incorrect to complain about what he calls the "narrowness" of libertarian concern for the interests of the poor. Nearly all of the issues he cites as examples of seeming libertarian indifference to the poor (mortgages, landlord-tenant law, campaign finance, etc.) are in fact fact areas where libertarians have long argued that the standard left-liberal policy prescriptions would make the poor worse off rather than better. Moreover, all have been the subject of extensive analysis by libertarian scholars (myself included, in some cases). Thus, it is incorrect to claim that libertarians have either neglected these issues generally, or their relevance to the poor specifically.

Libertarians and left-liberals are unlikely to reach consensus on all of these matters any time soon. But that should not prevent cooperation on those issues—including eminent domain—where we do have some important common ground.