Property Rights and the Common Good

The federal and state power of eminent domain is constrained by the Fifth Amendment's "Takings Clause": "nor shall private property be taken for public use, without just compensation." Thus government may take property only (1) for a "public use" and (2) with "just compensation." This constitutional provision seems innocuous, but it has created deep fault lines between those who view the state as a vehicle for the common good and those who see protection of private property as the natural right of citizens. Much controversy has swirled around the defining question: what is a "public use"?

This question has important public health dimensions because it helps determine when and how the state can interfere with economic rights to promote the common good. The powers of eminent domain can be exercised for many public health purposes—to renovate unsanitary or unsafe buildings, to convert private animal shelters to serve public needs of controlling dangerous animals, and to confiscate hospitals for care or even quarantine during a public health emergency.

Under the "public use" requirement, the state cannot take property solely to confer a private benefit, even if the owner were fully compensated. Classically, the state may not take the property of one person for the sole purpose of transferring it to another person. But what if the state's purpose were to advance the public interest in health, welfare, prosperity, or another public good, but the transfer also conferred an economic advantage on private parties? That was the case in Kelo v. New London, where the Supreme Court held that the government could confiscate private homes to renovate a decaying city.¹ The case, decided late last year, elicited a howl of protest from every ideological corner.

The term "public use" is susceptible to a narrow or broad interpretation. In its narrow sense, public use literally is "use by the public" where the government takes ownership (such as a public utility) or grants access to the public (a park, road, or railway). In its broader sense, public use is when the "taking" benefits the public. The Supreme Court historically has preferred an expansive understanding of public use, defining it more as a "public purpose." Court decisions have conceived of public use as virtually coterminous with the police powers. The Supreme Court has upheld the power of eminent domain provided it is "rationally related to a conceivable public purpose."² Moreover, the Court has deferred to elected bodies in deciding what forms of development will benefit the public.

For example, the Court was highly permissive in upholding the District of Columbia's use of eminent domain to acquire slum properties and transfer them to private developers to remove urban blight. Justice Douglas explained: "The concept of the public welfare is broad and inclusive. . . . The values it represents are spiritual as well as physical, aesthetic as well as monetary. . . . If those who govern decide that the Nation's Capital should be beautiful as well as sanitary, there is nothing in the Fifth Amendment that stands in the way."³

The Supreme Court's expansive understanding of "public use" was affirmed in a bitterly contested five-to-four decision in Kelo. This case featured homeowners who challenged the condemnation of their property under a comprehensive urban renewal plan designed to increase jobs and augment tax revenue in an economically distressed city. The Court found that economic development is a "long accepted function of government," and it refused to limit the use of eminent domain to properties that are "blighted" or to require government to show a "reasonable certainty" that the expected public benefits actually will ensue.

The decision was commonly seen as benefiting large corporations at the expense of homeowners and small businesses. (What really stuck in the craw of many Americans was that a new corporate facility for Pfizer Pharmaceuticals was part of the city plan.) Four justices in dissent fervently appealed to the founders' vision of the "security," "sanctity," and the "inviolability" of private property and the "natural rights" of property owners, declaring, "The specter of condemnation hangs over all property." And Justice Thomas said, "Losses will fall disproportionately on poor...