November 21, 2005

Kelo Update 2 for Nov. 21: NY Times Notes Financial Viability Problem, Confirms Two Key Points, Omits Others

Filed under: Economy,MSM Biz/Other Bias,Taxes & Government — Tom @ 12:41 pm

Note: Todd Zywicki at Volokh had a mini-post linking to the Times piece about 15 minutes before me while I was composing this (I checked earlier this morning–I really did).
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Quick overview: The Times article notes the opinions of some that the economics of the Fort Trumbull project may no longer work, notes that the project may begin away from the holdouts’ properties, confirms Pfizer’s active involvement in the project, and unfortunately omits several key items its readers should know to be fully informed.
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The New York Times article on the status of the Kelo eminent domain controversy starts by informing its readers, whom they must think will be surprised at the news, that not only is the project involved not started yet, it may not even fly (excerpted paragraphs are presented in a different order than they appear in the original article; delayed HT to Ann Althouse):

With so many complications, some people are unsure whether the city’s initial vision for the property – a mix of housing, hotel and office space intended to transform part of its riverfront and bolster a declining tax base – is even realistic anymore.

“Winning took so long,” said Mayor Jane L. Glover, “that the plan may not be as viable in 2005 or 2006 or 2007.”

….. One point of contention: Corcoran Jennison (the developer–Ed.) is resisting pressure from the city to build a waterfront hotel first, as was initially planned, out of concern that there is no market for one.

Corcoran Jennison says that Pfizer, which built a major research center next to the site in the late 1990′s and pushed for the Fort Trumbull development, backed away from a commitment to help pay for the hotel as the lawsuit dragged on. And the prospects for a Coast Guard museum, which under one plan could be built on the holdouts’ land, are also unclear.

….. “This lawsuit put a chill on the development of the whole 90 acres, no doubt in my mind,” said Thomas J. Londregan, the city’s director of law. “Any developer knew that whatever they did would most likely be appealed to the courts.”

The article also confirms two contentions of eminent-domain opponents that supporters have tried to deny. First, echoing Scott Bullock’s claim in his letter yesterday to The New London Day that the project doesn’t require that the holdouts’ property be seized for the project to begin:

If any construction begins soon, it will happen away from the area where the holdouts remain, said Marty Jones, president of Corcoran Jennison, which has been under contract on the project since 1999.

Second, and more important, The Times piece not only refutes Pfizer’s longtime contention of noninvolvement in pushing the project, it contains a contractor statement that Pfizer had previously made a financial commitment to the project (bold is mine):

Corcoran Jennison says that Pfizer, which built a major research center next to the site in the late 1990′s and pushed for the Fort Trumbull development, backed away from a commitment to help pay for the hotel as the lawsuit dragged on. And the prospects for a Coast Guard museum, which under one plan could be built on the holdouts’ land, are also unclear.

There are several errors and omissions in the piece that have to be noted:

  • The article says that “a key (New London Development Corporation) executive was forced out.” They know darn well it was the Chief Operating Officer, who was also the day-to-day “face” of the NLDC.
  • It fails to mentions the NLDC’s intimidation tactics of asking for years of back rent and saying they would buy the properties at Year 2000 market values that generated so much negative reaction that it precipitated a three-way fallout between the city, the state, and the NLDC.
  • It doesn’t mention the results of the election two weeks ago, when an upstart party that, among other things, wants the taking process to stop, took 2 of 7 New London Council seats and barely missed taking a third.

Perhaps the reason The Times omitted the NLDC’s intimidation attempts was because The Times aggressive eminent-domain tactics (go halfway through post for NYT-specific info) in building its new Manhattan headquarters?
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UPDATE: Heritage Foundation’s blog also covered the Times article.
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10 Comments

  1. Kelo Homeowners Still There:

    The New York Times has an update on the stalled eviction of the Kelo homeowners.

    Trackback by The Volokh Conspiracy — November 21, 2005 @ 1:32 pm

  2. Those with legal training may realize what the informal eminent domain moratorium in New London means in legal terms: it means a heightened level of scrutiny for housing is now in effect in the eminent domain context. Regardless of what the Supreme Court said in Lindsey v. Normet, we are now past the era of minimum scrutiny for housing. This is a step in the enforcement of the housing provision of the New Bill of Rights, which says:

    No individual shall be involuntarily deprived of housing.

    That, as you may know, is strict scrutiny for housing. The New Bill of Rights also includes this provision:

    No individual shall be involuntarily deprived of liberty.

    The Court, in Lawrence v. Texas, raised the level of scrutiny for liberty in the context of private sexual conduct between consenting adults.

    The New Bill of Rights contains three more provisions:

    No individual shall be involuntarily deprived of maintenance.

    This provision is currently being enforced in the context of eminent domain with respect to businesses which are operated by their owners and provide their owners’ source of income.

    No individual shall be involuntarily deprived of medical care.

    No individual shall be involuntarily deprived of housing.

    The New Bill of Rights is discussed in this article, which will appear in the November 2006, Stetson Law Review:

    Ryskamp, John Henry, “Kelo, Lawrence and the New Right to Housing Under the New Due Process” (November 2, 2005). http://ssrn.com/abstract=562521

    Liberals don’t like the New Bill of Rights, because it is about rights, not discretion. Conservatives don’t like the New Bill of Rights because it is about rights, not power.

    But people love the New Bill of Rights, and are steadily enforcing it.

    If you know of other examples where the New Bill of Rights is being enforced, please let me know.

    Comment by John Ryskamp — November 22, 2005 @ 1:22 am

  3. A friend at Pfizer told me that Haddasah Lieberman was the Director of Public Policy at Pfizer. Sen. Joe lieberman has been very quiet on this national disgrace.

    Comment by massgopguy — November 22, 2005 @ 12:33 pm

  4. #3, WAS is the operative word:

    http://en.wikipedia.org/wiki/Hadassah_Lieberman

    Director of Policy, Planning, and Communications at Pfizer from 1982-1985. That’s a long time ago.

    Lieberman’s quiet is inexcusable and hard to understand, but I haven’t seen much from any CT DC types (Dodd, Nancy Johnson, etc.), and I get enough Google Alerts that I don’t think I would have missed much of what they might have said.

    Comment by TBlumer — November 22, 2005 @ 12:46 pm

  5. I can tell you why politicians are clamming up. They really don’t know what to do. They can’t send in the police, and they can’t grant a higher level of scrutiny for housing. Pity them. What would YOU do in their place?

    Comment by John Ryskamp — November 22, 2005 @ 7:21 pm

  6. #5, I’m not saying what I personally would do, because I don’t think I ever would have allowed it to get to this point (my, is that easy to say).

    More substantively, if I were one of the two people from the One New London Party that just got elected, I’d be saying “Let’s make this go away, do the project on all the property we have, leave the holdouts alone, and be done with it.”

    The Council has 7 members, 4 are Dems, 2 ONL, and 1 GOP. If the 3rd ONL person had gotten on instead of losing by 19 votes, I think the “make it go away” would have happened, and very quickly.

    But it didn’t, and the Dems have a majority. My theory is that despite supposed national Dem sympathy with the Kelo holdouts, the 4 Dems will have an enormous amount of pressure on them from state and/or national Dems to see the taking through by maybe August 1 of 2006. If it doesn’t happen by then, the pressure may go in the opposite direction, because national Dems don’t want to be associated with the Kelo taking so close to Congressional elections, and they may do an about-face and lean on the locals to make it go away. I don’t think pushing it past Nov. 2006 is much of an option, as the Dem majority will be negatively associated with the delay, and I think it will have national impact.

    This all assumes that the ultimate outcome of this situation is as important as I think it is. I may very well be kidding myself, and learn that the vast majority of people ultimately don’t care.

    Comment by TBlumer — November 22, 2005 @ 7:45 pm

  7. There is no such thing any longer as “see the taking through.” They cannot send in the police and Rell will not send in the National Guard. Who are they going to ask, George Bush? You seem to think people can simply be pushed aside depending on what the political system decides. You are looking at a Kent State. There will be hundreds of people lying on the ground around Susette Kelo’s house if there is even a hint the police are about to move in. Then what?

    This scenario is why the political system will not act. Democrat, shemocrats–both parties make money off of eminent domain. The problem is exactly what I said it was: there is no PRINCIPLE at work in the law. Neither public opinion nor the political system can provide one. Look at them flounder in the state legislatures, trying pin a breeze to the wall. They are finding out that generalities such as “economic development,” “blight,” and “public purpose” were never legal principles, so they can’t be modified. They were always covers for police state activity.

    Now that has been exposed. The political system wants to continue with its police state activities and doesn’t understand why public opinion no longer wants it to do that. Public opinion doesn’t know what it wants, it only DOES what it wants. That is why you have, on the one hand, a powerless political system, and on the other, civil disobedience. People seem not to notice that Susette Kelo and the other property owners are even now engaging in civil disobedience. Why don’t people pay attention to the facts, and draw conclusions from the FACTS, instead of still living in their ideological dream worlds? Silly people.

    Kelo will grab attention because of the case. But the real violence, the real confrontation, is unfolding in Chicago over the O’Hare expansion, where the violence has already started. The property owners’ counsel there are so damned dumb they keep making their losing arguments–and losing. They absolutely REFUSE to make the only argument which can win–an argument for a higher level of scrutiny for housing based on the Due Process clause of the Fifth Amendment (that is what in FACT is happening)–so they are forcing this issue to confrontation. It will be exactly the same way it is in New London: intimidation will force out many of the homeowners, but there will be people who won’t leave. It will become clear through the political system’s intelligence-gathering network that if the police move in there will be hundreds of protestors to get out of the way, and things will be stalemated again because the political system absolutely will not send in the troops. I would advise law enforcement not to obey such an order, because it is not clear now that such an order would be legal. Don’t you think the lawyers for police and national guards are studying this matter? To whom do you think policy wonks turn in order to enforce their police state decisions?

    Isn’t it stupid? Just put the damned expansion in Peotone! In New London, just get on with the damned thing in a way which does not involve trying to force people out of housing. The problem is that no one will grant what is now the case. Here it is, etch it in stone, and then get over it:

    THERE WILL NEVER AGAIN BE REMOVAL OF PEOPLE FROM HOUSING FOR EMINENT DOMAIN.

    That’s the new law. But everyone is still living in denial–so we head toward confrontation.

    Comment by John Ryskamp — November 23, 2005 @ 12:19 pm

  8. #8, Don’t get me wrong, I hope you’re right, and in the Kelo case you probably are.

    But there are surely hundreds of smaller, “less significant” cases throughout the country that aren’t getting the publicity.

    And maybe it’s going to be tougher to force people from their homes, but that’s only a partial victory. Businesses are and will continue to be pushed around, and I doubt that the man-the barricades mentality to defend them is there. How about that tire store guy in Oakland (wish I had more news, just don’t have time to look)? He’s SOL. Is his 30-plus year business less important than someone’s home. I don’t think so.

    So it isn’t enough that Kelo will in many cases be overruled by the fear of negative fallout from forced removal. It needs to be overturned in 50 state legislatures decisively.

    Comment by TBlumer — November 23, 2005 @ 1:18 pm

  9. I think that Oakland guy should have put up more of a resistance. When another neighborhood in Oakland was threatened with “development,” people had a fit and the politicans backed down.

    Nor do I think businesses are being booted out just because they are businesses. I follow this story every day, and I don’t see a single instance in the country–whether large eminent domain action or small–where people OR businesses have been booted out since Kelo. (I don’t know, is Googlenews the best way to search newspapers large and small? or is there a better one?). Nor do they seem to have simply given and gone away. Actually, they seem to be resisting by litigation. Not that the law currently is on their side, but it’s the delay that matters.

    This is one of those issues on which the political system is so far removed from public opinion that it is simply powerless when it comes to delay. It can’t bring the delay to an end. Of course, we are not even a year into the post-Kelo era. Let’s see how things play out with the biggies–O’Hare and Riviera Beach, Florida as well as the Trans-Texas Corridor.

    The “reforms” I have been reading (even those proposed by the “property rights” movement), are such a bunch of drivel that they might as well have been written by Louis XVI.

    Comment by John Ryskamp — December 9, 2005 @ 1:50 pm

  10. See the more recent post with the link to the exhaustive and exhausting list at Castle Coalition (near the end):

    http://www.bizzyblog.com/?p=985

    It also comments on various state laws and links to a VERY detailed analysis of the various state laws.

    The thing with O’Hare is that it’s a defensible public purpose, unless I’m missing something.

    Comment by TBlumer — December 9, 2005 @ 1:57 pm

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