Finding property rights in the rubble

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Just before dawn on July 14, 1981, Detroit police hooked a tow truck to the basement door of the Immaculate Conception Church on Trombly Street and tore it off its hinges. They stormed in and arrested a dozen parishioners making a desperate, doomed attempt to save part of their neighborhood from an assault by an unbeatable alliance of big government, big business and big labor.

This was the last stand in the battle over Poletown, a lower-middle-class, racially integrated neighborhood of Detroit razed at the behest of General Motors more than two decades ago. To make room for a GM assembly plant, the city cleared 465 acres, incidentally destroying some 1,400 homes, about 140 businesses and several churches.

In a shameful capitulation, the Michigan Supreme Court approved Poletown's demolition as a legitimate exercise of the city's eminent domain powers. It accepted the argument that the jobs and tax revenue the GM plant was expected to bring rendered it a "public use," as required by the Michigan constitution (as well as other state constitutions and the U.S. Constitution).

Last month the court finally acknowledged that its ruling in Poletown Neighborhood Council vs. City of Detroit was a mistake that opened the door to the potentially unlimited expropriation of private property in the name of the greater good. While considering a Wayne County attempt to seize land for a 1,300-acre "business and technology park," the court's seven judges unanimously overruled the Poletown decision.

"Poletown's 'economic benefit' rationale would validate practically any exercise of the power of eminent domain on behalf of a private entity," the court noted. "If one's ownership of private property is forever subject to the government's determination that another private party would put one's land to better use, then the ownership of real property is perpetually threatened by the expansion plans of any large discount retailer, 'megastore,' or the like."

Then-Justice James L. Ryan, who dissented from the Poletown decision, said much the same thing in 1981, warning that the ruling "seriously jeopardized the security of all private property ownership." A lot of damage has been done since then, both in Michigan and in other states where courts have copied Poletown's reasoning.

The Rev. Joseph Karasiewicz, pastor of Poletown's Immaculate Conception Church, was prescient when he explained to The Washington Post why he was resisting GM's government-backed invasion. "This is an evil law, and we have to fight it," he said of the statute authorizing condemnation of the neighborhood. "You can't establish some type of crooked law and then say you did it legally. This has national implications and national scope. It sets a bad precedent."

In the wake of Poletown, courts across the country have endorsed forced transfers of land from its rightful owners to people with more political clout -- from homeowners to condominium developers, from small businesses to large businesses, from churches to retailers.

Last fall the Nevada Supreme Court cited Poletown in upholding condemnation of land to be used for Las Vegas casino parking.

"Poletown was the first major case allowing condemnations of areas in the name of jobs and taxes," explains Institute for Justice attorney Dana Berliner, who co-authored a brief urging repudiation of the decision. "It is cited in every property textbook in the country."

An aspect of the decision intended as a safeguard -- a requirement that a project's economic benefit be "clear and significant" -- has had a perverse impact, encouraging larger seizures of land and hyperbolic predictions about jobs and revenue. Even in Poletown, employment at the heavily subsidized GM plant fell far short of the 6,000 jobs the company promised.

In the case that prompted the Michigan Supreme Court to reconsider Poletown, Wayne County predicted "thousands of jobs," "tens of millions of dollars in tax revenue," a broader tax base, and "accelerated economic growth." But if the project failed to deliver those results, no one would be accountable.

Such projections are, in any case, beside the point. "It's the principle of the thing," Poletown resident Kris Biernacki told The Washington Post in 1981. "I think the whole thing stinks. I just don't believe it happened. It's breathtaking. We didn't have a voice in it -- not a voice. We didn't want to move. We were literally forced to move out. We were just told to go."

Jacob Sullum is a nationally syndicated columnist.