Property Rights and Their Threats

There is perhaps no greater concept for human survival maligned by the Left as “unjust” than the concept of personal property rights.  It is upon this concept that all great civilizations and nations are built and the most prosperous nations today are those with the most demonstrated respect for these rights.  Economic progress is not measured by the leveling of rights, or even the access to property acquisition.  Progress should be measured by the degree of freedom to private property and, once attained, freedom from arbitrary government force regarding that property.

Since Aristotle, the superiority of private property over collectivization has been recognized.  At its core, this fact formed the basis of the economic and political philosophy of such greats as David Hume and Adam Smith.  Americans like Thomas Jefferson, James Madison and George Washington recognized this also.  Jefferson’s “Life, liberty and the pursuit of happiness” is, all hyperbole aside, reinforcing the belief in private property ownership.  The Constitution itself enshrines property rights in the patent and copyright clause of Article I, Section 8.  The Bill of Rights and the Fourth and Fifth Amendments also enshrine property rights.  The abrogation of property rights by the British Crown was one of the grievances in the Declaration of Independence and the Fifth Amendment is also derived from the Articles of Confederation.

Americans have experimented with collective property rights in the past with disastrous results.  Jamestown was one such example.  Plymouth colony tried to rely on strict Christian values to induce work for the communal good and it too was a disaster.  The colony was on the brink of starvation when they switched to a private property system in 1623.  Within two years, the fate of Plymouth colony improved dramatically.  Many early Utopian establishments in the young United States were met with a similar fate.  In former Soviet areas, less than 1% of all land was held in private hands, yet these private farms outperformed the collective farms every year.  Today in some impoverished nations, the uncertainty surrounding property rights has chained those countries to a life of squalor.

Private property rights are vital to economic development and progress for a variety of reasons.  First, they provide the legal certainty that allow individuals to commit private resources to many ventures.  The threat of confiscation of private property is a recipe for disaster as Venezuela has found out the hard way.  Second, absent private property rights, people tend to be short-sighted in their decision-making and fail to conserve resources over time.  They are the basis for exchange that allow financial markets to develop that are essential.  And, finally, it is the basis for limited and civilized government.  It allows economic actors to make reasoned decisions.  In an atmosphere of certainty, that is made a greater possibility.

In the United States, we have always benefited from private property and free enterprise.  Therefore, the biggest threats lie in the slow erosion of this core, fundamental truth.  And those threats consist of three broad areas: (1) regulation, (2) eminent domain, and (3) civil asset forfeiture.

Examples of the ill-effects of wanton regulation are numerous with the EPA being the biggest transgressor at the federal level, although red and blue states are equal opportunity offenders, some more so than others.  The definition of “navigable waters of the United States” has been so expanded that in certain cases a backyard koi pond can be regulated.  By declaring carbon dioxide a hazard to public health- a gas that occurs naturally in the atmosphere and is even essential for life- the EPA gained the justification to regulate greenhouse gases from the biggest power plant to the exhaust hood of a restaurant.

In California, their Coastal Commission has redefined “coast” to mean they can regulate anything up to five miles inland from the coast.  Any improvement involving a “solid structure” requires their approval.  A multi-state planning board in Lake Tahoe regulates lakefront property including the color of paint.  In Washington, DC, a landlord cannot sell their property without the consent of the tenants.  Near San Francisco, homes designated “affordable housing” cannot be sold for more than a government-dictated price.  In large areas of Portland, you cannot build a single-family home on your land even if it is adjacent to existing single-family developments.  And the list can go on and on.

The second area of abuse is eminent domain.  Since our founding, the practice has existed.  However, the government has been restricted from taking private property except if two criteria are met: (1) it is for the public good, and (2) the owner receives just compensation.  The problem today is that the definition of “public good” has been expanded beyond things like roads or military installations to economic development in general.  To be sure, the Supreme Court’s decision in Kelo vs. City of New London was perhaps one of the worst decisions of Court jurisprudence since Roe vs. Wade and placed a stamp of approval on the practice.

In the context of urban renewal, eminent domain is particularly troublesome since it more greatly affects minority populations.  Statistics show that these eminent domain takings occur disproportionately in poor and minority areas.  From a libertarian standpoint, even the dictates of the Fifth Amendment are somewhat troublesome.  The government does not condone a criminal confronted with “an offer they can’t refuse” while simultaneously acting like a criminal offering someone “an offer they can’t refuse.”  And although eminent domain has been with us since our founding, it was limited at the time to truly public uses (like roads and forts) and, thus, the “damage” was limited.  It is interesting to note that years after Kelo which the city won, the property in question remains an empty, vacant eyesore.

The final area of concern is civil asset forfeiture.  The basic premise behind it is appealing.  It enables law enforcement authorities to seize the assets of criminal enterprises and drug dealing and re-funnel those funds into law enforcement.  Hundreds of state and federal seizure laws now authorize the practice for anything from securities fraud to an illegal poker game in your basement.

The idea of forfeiture, like eminent domain, has been around since our founding.  One grievance cited in the Declaration of Independence was the British practice of “writs of assistance” that authorized British agents to enter the home of any colonist and seize illegal contraband.  After the ratification of the Constitution, our new Congress authorized the seizure of pirate ships and treasures which made sense since it became easiest to prosecute and seize a vessel and its contraband than to prosecute the owner who lived an ocean away.  With the decline in piracy, the practice was discontinued and laid dormant until the 1970’s.

Federal law allowed law enforcement to seize money and goods tied to the making and distribution of illegal drugs.  Later amendments allowed them to seize anything thought to be purchased with tainted funds whether that “thing” had any connection to the commission of a crime.  Even then, the practice of forfeiture was rare.  In 1984, Congress passed the Comprehensive Crime Control Act and things changed.  This law allowed law enforcement authorities to funnel anything confiscated back into law enforcement.  Local police who provided assistance to federal authorities were granted a percentage of the booty.  This then encouraged states, strapped for cash, to pass their own forfeiture laws.

It has been a lucrative racket.  In 1985, proceeds from forfeiture amounted to $27 million.  In 2014, that total rose to $4.2 billion.  In 1989, the US Attorney General boasted, “It’s now possible for a drug dealer to serve time in a forfeiture-financed prison after being arrested by agents driving a forfeiture-provided automobile while working in a forfeiture-funded sting operation.”  And states are no better.  In some counties in Texas, greater than 40% of the law enforcement budget is funded by forfeiture.

In general, a person need not be found guilty of any crime for the practice to occur.  Mere suspicion has been placed on par with probable cause.  In fact, there are numerous cases of individuals never being charged with a crime, or even accused of a crime.  Criminal forfeiture requires that a person be convicted of a crime before any property can be confiscated.  Civil forfeiture, on the other hand, amounts to a lawsuit filed directly against a possession regardless of the owner’s innocence or guilt.  There are numerous examples of abuse of this practice which has led not to valid law enforcement, but law enforcement for profit.  Even in cases where innocent people prove their innocence in a court, it costs more than the trouble in legal fees to recover what is rightfully their’s.  To make problems even worse, there are 49 states that approve of this practice in their laws with only North Carolina being the exception.  They allow for seizure of assets only after a criminal conviction has been obtained.

Whether a huge corporation or the average Joe on the street, a respect for one’s property rights was once considered a hallmark of conservatism.  But as illustrated above, the Comprehensive Crime Control Act was passed by a Republican Congress and signed into law by a Republican President.  As illustrated, even a red state like Texas has allowed the abuse of the civil forfeiture laws and the fact such similar laws exist in even redder states like Wyoming is further disheartening to the true conservative.  We have witnessed abuses of eminent domain in red, blue and purple states alike.

By redefining “the public good” or even negating a bedrock of American law- that one is considered innocent until proven otherwise- anyone who claims to be “conservative” who condones these practices is really no conservative.  Good intentions are riddled with horrible consequences in these areas.  The only proper government policy with respect to private property is this: “Hands off!”  We need go no further than that.