Yawn…Another Property Rights “Conspiracy” Theory

After my earlier post, I read this Grist blog post that further perpetuates the regulatory takings “conspiracy theory.” At least the author, Eric de Place, is up-front about it, helpfully titling the post, “The takings conspiracy.” I get a kick out of reading this stuff…since the X-Files went off the air, we just haven’t had a lot of good outlets for conspiracy theories. Thanks to Mr. de Place and Grist for providing some quality entertainment. Yet, two things did rub me the wrong way.

First, they’ve tried to confuse the central issue by talking about eminent domain — an entirely different subject. The strategy of confusion was laid out in a Reason Foundation paper helpfully subtitled “Exporting Measure 37 To Other States.” The paper effectively set the movement’s marching orders.

Wow! Marching orders! I guess that I’m a general and didn’t know it. But seriously, there’s nothing to confuse here. Eminent domain and regulatory takings are not separate issues; they’re fundamentally interrelated. Go back to my previous post on the blurring of the line between the eminent domain & police powers. If they were unrelated, then why would regulatory takings also be known as “inverse condemnation?” As I mentioned earlier, they are two sides of the same coin, and the fundamental argument is that the instances of regulation in question are not those that fall under the traditional police power justification of preventing harm. Rather, the regulations that are objected to are most properly viewed as falling under the category of conferring benefits to the public-at-large (a la eminent domain), and the key problem with regulatory takings is that impacted landowners are not compensated for their losses as they would be in a “traditional” eminent domain action. If you’re painting a conspiracy theory, the facts and legal intricacies are irrelevant. But the least Mr. de Place could do would be to reference my report accurately:

Somewhat ironically, the Reason Foundation’s marching orders accidentally make clear that many of the 2006 ballot measures may be unconstitutional, at least in states that permit initiatives to contain only a single subject. Eminent domain and regulatory takings are two separate issues, according to Reason (they’re right about that), and they propose using one to run interference for the other.

Perhaps Mr. de Place assumes that his readers are too lazy to actually read my report, but if they did, what they’d find is this:

It is also important for measure drafters to examine the “single subject” or “separate votes” provisions in the state Constitution to ensure that a proposed regulatory takings measure would not violate them. Most states prohibit logrolling (bundling popular bills with unpopular ones) through “single subject” requirements mandating that a legislative bill only address one subject. In states with the citizen initiative process, these rules generally apply to both the initiative and to legislative bills. Similarly, “separate votes” requirements prevent any constitutional amendment that involves two or more changes to the Constitution that are substantive and that are not closely related. The Oregon Supreme Court invalidated Measure 7 (Measure 37’s predecessor) on “separate votes” grounds. Each state has a different view and different body of case law on when a measure or amendment constitutes more than one subject.

If you read the whole section in context, it becomes clear that when I discussed the single-subject rules, it wasn’t in reference to combining eminent domain and regulatory takings. It was referenced as good practice for ANY ballot measure. Why would I say that? Because Measure 7, the precursor to Measure 37, was struck down on…yes, you guessed it…single-subject grounds. Did Measure 7 or Measure 37 cover eminent domain abuse? No. The whole point of that section was to tell drafters that they need to be very familiar with the state jurisprudence and judicial temperament before they draft anything or else they could risk the fate of Measure 7. For Mr. de Place to try and reference my report out of context and make the implication that I actually suggested Kelo-Plus measures would run afoul of single subject rules is just bogus. And BTW, again, as I’ve said over and over, I don’t view eminent domain abuse & regulatory takings as separate issues. They’re two variants of the same kind of property rights abuse, they’re based on the same conceptual legal foundation, and they are rooted in the same clause of the 5th Amendment. They’re like Red Delicious and Granny Smith apples…they may different colors and slightly different textures, but they’re both sweet and they are fundamentally just apples.

Leonard Gilroy is Senior Managing Director of the Pension Integrity Project at Reason Foundation, a nonprofit think tank advancing free minds and free markets. The Pension Integrity Project assists policymakers and other stakeholders in designing, analyzing and implementing public sector pension reforms.