Last week, the drug maker Pfizer announced it would close its research and development facility in New London, Connecticut. The Pfizer facility was at the heart of the city’s decision to use eminent domain to seize and raze an entire neighborhood to make way for the development project and prompted the now infamous Kelo v. City of New London. According to the New York Times:
“Pfizer said it would pull 1,400 jobs out of New London within two years and move most of them a few miles away to a campus it owns in Groton, Conn., as a cost-cutting measure. It would leave behind the city’s biggest office complex and an adjacent swath of barren land that was cleared of dozens of homes to make room for a hotel, stores and condominiums that were never built.
“The announcement stirred up resentment and bitterness among some local residents. They see Pfizer as a corporate carpetbagger that took public money, in the form of big tax breaks, and now wants to run.”
The Kelo case is named after Suzette Kelo, who argued with the help of the Institute for Justice in Washington, D.C. that the government simply couldn’t seize her property and hand it over to another private party because their intended use would be more profitable. The U.S. Supreme Court disagreed, and said, in effect, that as long as the city officially said seizing her house (and others in the neighborhood) served a public purpose that’s all they needed to use eminent domain. The decision effectively gave a green light to takings for economic development purposes, and the Institute for Justice has been documenting rising levels of abuse since then.
Well, now the entire project in New London has gone down the tubes. The failure of the economic development project and the implications for using eminent domain for economic development purposes were the subject of a New York Times forum “Room for Debate” last week and has prompted nearly 200 responses.
Among the formal contributions include law professors that argue that the Constitution really was never meant to restraint government’s taking of private property anyway as long as compensation is paid to the victims. Interesting, most of the formal responses focus on the political ramifications rather than the abandonment of private property protections by the judiciary and elected officials.
More on Reason Foundation’s work on eminent domain and regulatory takings, including our amicus brief on Kelo, can be found here.