A rare, remarkable victory for private property rights

In 1981, the Michigan Supreme Court handed down a ruling whose effects have been felt far beyond the borders of that state. General Motors wished to build a new plant in Detroit, and the only thing that stood in their way was Poletown, a residential neighborhood. Many residents were refusing to sell, so GM asked the city for help. The city of Detroit, seeing the economic benefit the new plant would bring, and seeing that those who would benefit from the new plant represented more votes than did those living in Poletown, initiated condemnation proceedings against the holdouts.

Detroit was seizing the property of private entities for the benefit of another private entity. Amazingly, the Michigan Supremes upheld the seizure.

In the 23 years following the Poletown case, this odious use of eminent domain powers has become pandemic. We are no longer surprised to see stories of local governments seizing property from the politically powerless and turning it over to businesses who promise either more jobs (resulting in political capital for the officeholders) or more property taxes (which the officeholders also seem to like).

The U.S. Constitution's fifth amendment implies that the only legitimate reason for government to compel the sale of private property is because the land is needed for some genuine public use that the government is supposed to provide for -- roads and other such infrastructure, necessary government offices, public schools (not that education is supposed to be a government function, but I digress). It does not allow the government to force retirees and small businesses out for the benefit of GM, Ikea, Wal-Mart and the like.

Apparently, somebody finally noticed that the "Poletown standard" also violated the Michigan constitution. The current Michigan Supremes used the occasion of a new eminent domain case to unanimously overturn the Poletown ruling (emphasis added):

"The county is without constitutional authority to condemn the properties," the court's opinion read. All seven justices voted to overturn Poletown, although three dissented over some technical aspects that do not affect the main ruling.

Justice Robert Young, who wrote the lead opinion, called the 1981 case allowing Detroit's Poletown neighborhood to be cleared for a GM plant a "radical departure from fundamental constitutional principles."

"We overrule Poletown," Young wrote, "in order to vindicate our constitution, protect the people's property rights and preserve the legitimacy of the judicial branch as the expositor, not creator, of fundamental law."

The judicial branch is "the expositor [i.e. explainer], not creator, of fundamental law". When is the last time we heard that from a court? Will we ever hear it again from a working majority of the U.S. Supreme Court?

We can't leave this story without noting the reaction of Wayne County (defendant in the current case) to the ruling:

[A] spokesman for Wayne County Executive Robert Ficano issued a statement saying that "the Michigan Supreme Court's decision to change Michigan law and divest municipalities from their ability to create jobs for their citizens is a disappointment not only for Wayne County, but for all of the Michigan communities struggling to address these difficult economic times."

According to Wayne County, the land seizure in question was for the purpose of "creating jobs" -- and apparently they could only be created right where some people were already living. This whole idea of the government "creating jobs" is worth another essay...some time. Meanwhile, I'll just repeat my cynical observation that government "job creation" initiatives are scarcely distinguishable from vote buying schemes. Sigh.

UPDATE: PolicyGuy (Hi, John!) gives more details on the story and on its implications.