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August 6, 2004

Razing Objections

A court rediscovers property rights in the rubble of Poletown

Jacob Sullum <mailto:jsullum@reason.com>

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 who
were 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 that was razed at the behest of
General Motors more than two decades ago. To make room for a G.M. 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
<http://www.law.berkeley.edu/faculty/rubinfeldd/LS145/poletown.html>
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 G.M.
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 v. 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 an attempt by Wayne County to seize
land for a 1,300-acre "business and technology park," the court's seven
judges unanimously overruled
<http://courts.michigan.gov/supremecourt/Clerk/Opinions-03-04-Term/124070.pd
f> 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 G.M.'s government-backed invasion. "This is an evil law and we
have to fight it," he said of the statute that authorized 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 <http://www.ij.org/publications/castle/> 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 <http://www.lewrockwell.com/orig2/french6.html> the condemnation
of land to be used for casino parking in Las Vegas.

"Poletown was the first major case allowing condemnations of areas in the
name of jobs and taxes," explains
<http://www.ij.org/media/private_property/michigan/> Institute for Justice
attorney Dana Berliner, who co-authored a brief
<http://www.ij.org/PDF_folder/property_rights/MI_Hathcock_Amicus_Brief.pdf>
urging repudiation of the decision. "It is cited in every property textbook
in the country."

An aspect of the decision that was 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 G.M. 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."