Submitted by michael kaplan on Sat, 2009/11/14 - 7:14pm

posted originally on the gather website

Walk down memory lane, and try to remember the details and merits of a case from just a few short years ago. Heard before the United States Supreme Court in 2005 as one of the most watched and analyzed property-rights decisions in perhaps a decade or more, Kelo v. New London, CT. set a new precedent for the idea or concept of eminent domain.

continued...

The liberally led Supreme Court suggested, not only is the state or local government able to seize private property in pursuit of the commonweal, such as building roads and bridges, schools and prisons and the like; government entities are now free to confiscate property under the rubric of and for, the common good, however it would be done in cooperation with, and some would suggest the entitlement mentality of, corporate welfare.

Pfizer is the big bad evil capitalist player being denounced by one and all in this particular little drama.

“In all honesty, I’m not happy about what happened to me,” Ms. Kelo said. But, she added, “With forty three states changing their laws, in that sense I feel we did some good for people across the country.”

The Pfizer property is currently assessed at $220 million. City Councilman Robert M. Pero said the Pfizer complex enjoys incentives allowing the company to pay taxes on 20 percent of that value, while the state pays an additional 40 percent. That arrangement is scheduled to end in 2011, ten years after the complex opened to employ nearly 1,400 people. This happens to be the same time Pfizer, which is currently the city’s biggest taxpayer, expects to complete its withdrawal from the city of approximately 265,000 people, bringing an end to their ten year agreement to pay property taxes at a reduced rate.

“Basically, our economy lost a thousand jobs, but we still have a building,” Councilman Pero said. Then again, he added, “I don’t know who’s going to be looking for a building like that in this economy.”

City residents are forced to be consoled the court had four conservative voices led by Justice Clarence Thomas in the dissenting opinion. Justice Thomas called New London’s plan “a costly urban-renewal project whose stated purpose is a vague promise of new jobs and increased tax revenue, but which is also suspiciously agreeable to the Pfizer Corporation.”

Isn't it ironic, when republicans like Justice Thomas are leading the charge against the big bad evil corporations, even as liberals hurl another stereotypical rant against republicans having sold out to corporate interests. They tell us the liberals are always looking out for the little guy. Instead, the USSC led by a single vote majority of liberalism at its very best-- demonstrates the court is quite willing to aid and abet the expansion of power and the influence of whatever level of government entity is in question, whether local, state, or federal.

Widely criticized, the decision spurred states across the country to adopt statutes preventing similar abuses of eminent domain. Scott Bullock, senior attorney at the libertarian minded Institute for Justice, represented the landowners in Kelo vs New London, CT. Mr. Bullock, said the announcement “really shows the folly of these plans that use massive corporate welfare and abuse eminent domain for private development. They often times fail to live up to expectations."

The liberals on the court expanded the reach of government entities as it applies to eminent domain, and now we live in a world where it is necessary for forty three states to pass laws purporting to protect the very principles of property ownership, that once were givens in a more simple era, a more verbally robust and honest period of our nation's history.

I wonder what it takes, what is required for a stereotype to die, and never be heard from again except perhaps at some future way back party where everyone dresses funny and reminisces. Who knows?

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michael kaplan's picture

Here's the Wall Street

Here's the Wall Street Journal piece on the subject.

Pfizer and Kelo's Ghost Town
Pfizer bugs out, long after the land grab.

The Supreme Court's 2005 decision in Kelo v. City of New London stands as one of the worst in recent years, handing local governments carte blanche to seize private property in the name of economic development. Now, four years after that decision gave Susette Kelo's land to private developers for a project including a hotel and offices intended to enhance Pfizer Inc.'s nearby corporate facility, the pharmaceutical giant has announced it will close its research and development headquarters in New London, Connecticut.

The aftermath of Kelo is the latest example of the futility of using eminent domain as corporate welfare. While Ms. Kelo and her neighbors lost their homes, the city and the state spent some $78 million to bulldoze private property for high-end condos and other "desirable" elements. Instead, the wrecked and condemned neighborhood still stands vacant, without any of the touted tax benefits or job creation.

That's especially galling because the five Supreme Court Justices cited the development plan as a major factor in rationalizing their Kelo decision. Justice Anthony Kennedy called the plan "comprehensive," while Justice John Paul Stevens insisted that "The city has carefully formulated a development plan that it believes will provide appreciable benefits to the community, including, but not limited to, new jobs and increased tax revenue." So much for that.

Kelo's silver lining has been that it transformed eminent domain from an arcane government power into a major concern of voters who suddenly wonder if their own homes are at risk. According to the Institute for Justice, which represented Susette Kelo, 43 states have since passed laws that place limits and safeguards on eminent domain, giving property owners greater security in their homes. State courts have also held local development projects to a higher standard than what prevailed against the condemned neighborhood in New London.

If there is a lesson from Connecticut's misfortune, it is that economic development that relies on the strong arm of government will never be the kind to create sustainable growth.

Up Goose Creek's picture

Vast wasteland

I didn't try the WSJ article - can't usually get past their firewall - sorry if this is a repeat.

It's not just the Pfizer HQ that's going to be empty - dozens (hundreds?) of acres slated for redevelopment are sitting empty.

Fro IJ's Christina Walsh -

"the very land where Susette Kelo’s home once stood remains barren to all but feral cats, seagulls and weeds"

____________________________
more construction, less politics

michael kaplan's picture

i've added the entire WSJ

i've added the entire WSJ article to my post.

rikki's picture

"Pfizer...expects to

"Pfizer...expects to complete its withdrawal from the city of approximately 265,000 people"

It sounds more like genocide than a failed development. Either that or yet more disinformation about a widely misunderstood court case.

I suspect most of the laws passed in the wake of Kelo were more in reaction to right-wing propaganda than to the decision itself. If states and local governments really want to protect themselves from poor investments, they don't need to put additional constraints on the use of eminent domain. They need to change campaign finance and lobbyist disclosure laws. Pfizer is on OpenSecrets' heavy hitters list. I wonder if they'd be a better citizen if corrupting politicians weren't as big a component of their business model.

metulj's picture

It is also noteworthy that

It is also noteworthy that the Institute for Justice is a "libertarian" outfit that basically dropped the ball in the arguments before the SCOTUS. If you read the Kelo decision there's a lot of "no compelling" and the like. I think takings for transfer to private entities are a human rights violation of the first order, but if you are going to argue against an action like the Pfizer/New London land grab (and, by extension, argue with a very powerful, as Rikki points out, multinational corporation) come with your 'A' game, not a bunch of yahoos with axes a-grindin'.

True happiness is knowing you are a hypocrite. -- Ivor Cutler

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