Remember the Kelo case, where the Supreme Court said it was all right for cities to take property under eminent domain for “economic development” reasons? Many people objected to the morality of taking people’s property just so a city can have some additional economic growth.
Ah, but do you even get economic growth? In this article Steve Malanga of Manhattan Institute points out that the grandiose plan to “revitalize” New London, CT (the site of the Kelo case) has flopped. “The ground where Suzette Kelo’s home stood is now barren, because the townhouses that the city-sponsored developer was supposed to build there have never gone up. Interest in the area isn’t very great and the developer hasn’t been able to get financing,” Malanga writes.
That should not be surprising. Politically planned economic development has a lousy track record, whether it’s Soviet industry or urban development in the US. Politicians aren’t playing with their own money and therefore often blunder — and keep blundering since other people bear the costs of their mistakes.
Infinitely better, both morally and economically, than the use of eminent domain to bring about economic development is a policy that is friendly to investment of all kinds and does not deter entrepreneurship. Many American cities, however, are decided unfriendly to investment and entrepreneurship.
