On Wednesday, The Wall Street Journal’s econblog featured a debate over eminent domain between Don Boudreaux, chairman of the economics department at George Mason University, and David Barron, a law professor at Harvard. The debate was prompted by the important eminent domain case that’s now before the Supreme Court, Kelo v. New London.
You can read the whole thing here.
In a rather short debate, only a few points can be covered, and the exchange missed a couple of crucial matters.
First, it is usually assumed by eminent domain advocates (particularly those who advocate the use of e.d. not to assemble land for a public structure such as a road, but rather to “revitalize” a city area by transferring land from the owners to businesses who will put up commercial structures that will enhance the city’s tax base) that these ventures “work.” But these sort of government-facilitated projects often flop. Government officials have a bad track record of picking economic winners and they’re no better when it comes to figuring out ideal uses for land.
Second, even if the project “works,” so what? Let’s say that the tax base of New London expands because of the project. Does that necessarily mean that things will be better for the inhabitants — those who aren’t forced out, of course? Do local governments invariably spend added increments of tax revenue in ways that make the citizenry better off? Well, no. Experience tells us that additional revenues are usually siphoned off by the various special interest groups that know how to feed at the public trough. Government employees, for example. I have suggested to Don Boudreaux that it would be a great dissertation topic for some student to take a close look at some cities that have done this sort of thing to see if there is any evidence that the benefits redound to the population at large. Until I see some strong evidence to the contrary, I believe it reasonable to believe that eminent domain imposes losses on relatively poor landowners in order to benefit relatively wealthy interest groups.
I have posted a comment about the debate. If you go to it and click on the replies, mine is #16.
