Freakanomics: “Just Compensation” Can Lead to More Government Takings. Huh?

Ian Ayres writes at the Freakanomics Blog:

What really interests me about Bankman’s idea is that requiring the government to pay for its takings might lead to more takings. This is very different from the way we usually think about the impact of compensation:

“A central idea behind the Constitution’s Takings Clause is to reduce government’s inclination to take too much. A government that is forced to compensate for the exercise of its eminent domain power is less likely to engage in value-reducing land grabs.”

But requiring compensation might increase the willingness of government to take. As Barry and I wrote:

“The big hope is to end the stranglehold that anti-IRS forces have on compliance efforts. . . . Absent compensation, Congress has vetoed efficient audit programs–setting the audit rates far below their optimal level. Here’s a rare case where forcing the government to pay for something is likely to increase its demand.”

The government, in deciding whether to take, is in some ways on both sides of the market, acting as both a buyer and a seller. The normal intuition that the just compensation requirement will dampen government’s demand to take conceives of the government as a buyer. But in a representative government, the amount of takings will be partly determined by the willingness of representatives to sell at a particular price. When the selling price is zero — as with current tax audits, government as representatives of sellers may choose to sell very little. (This possibility was to my knowledge first seen in Bruce A. Ackerman’s classic Private Property and the Constitution.)

Having just finished reading Super Freakanomics, I take all conclusions from freakanomics with a grain of salt.  If the Constitution did not provide for just compensation for takings, would bureaucrats be less willing to take? I don’t know. For many takings for economic development, the actual just compensation price is trivial compared to the expected benefits the future owner will bring. From that perspective, I’m not sure how much legislators would really even care about the compensation amount. But curious.

Posted in Olech, Eminent Domain. Comments Off on Freakanomics: “Just Compensation” Can Lead to More Government Takings. Huh?

Barnett v. Kerr on McDonald v. Chicago. A fun little tussle is brewing on Volokh today.

A fun little tussle is brewing on Volokh today.

Professor Kerr made his predictions for McDonald (my thoughts here), Professor Bernstein made his predictions (my thought here), and now Professor Barnett has opined.

A few choice nuggets from Professor Barnett regarding Professor Kerr’s posts:

“How sad it is that one can implicitly criticize a brief to the Supreme Court of the United States for relying on the text of the Constitution. Although Alan Gura’s brief does stress both original public meaning and original intent, under the relevant precedent Orin thinks the Court will or should (?) follow, the alternative is not that the Privileges or Immunities has a modern meaning but has no meaning whatsoever! “

“Faced with this background and the actual question presented, I wonder how would Orin have briefed the case. Would he have offered any of the analysis in his post? Would he have told the Court just to ignore the Privileges or Immunities Clause? Or might he not have assumed as an experienced litigator that the Justices could write a Due Process Clause “incorporation” opinion in their sleep–heck, their clerks could write that opinion in their sleep–and then devoted the bulk of his brief to describing the meaning of the Privileges or Immunities Clause in context? ”

“The sort of “legal realist” analysis offered by Orin in his post would simply be of no assistance to the Court in reaching its decision. Nor would it help much in oral argument. But who knows? As a mere prediction, it could turn out right, in which case Orin can say he told us so.”

I am expecting Professor Kerr to reply shortly, but Barnett I think has the better argument. As Barnett points out, 4 Justices had to request that the Privileges or Immunities reference should exist in the Question Presented. On Kerr’s breakdown, only one Justice seems interested. This just doesn’t jive.

With the Supreme Court, always expect the unexpected.

Update: Orin replied to Randy,  kind of:

I had a feeling my post predicting the votes on the Privileges and Immunity argument in McDonald v. City of Chicago might draw a disapproving response from Randy, and I see it did. Based on past experience, I gather Randy’s questions directed to me are rhetorical questions designed to defend Randy’s view of the Constitution, not ones asking for my response. But I did want to open a comment thread on the issue in case our commenters wanted to weigh in.

He posted an open thread, which should yield some interesting debate.

(Oh, and I should be clear that I think McDonald will win on the Due Process argument, perhaps by 7 or 8 votes; I just don’t think more than one Justice is on board for the P or I stuff, especially given that it’s not necessary to even reach the issue to decide this case.)

Update 2: Barnett just replied:

I predict that, every time I or another VC blogger posts with closed comments on a subject that Orin finds interesting, he will post something short with open comments soon thereafter. We will see how this prediction holds in the future.

Bernstein on McDonald and Privileges or Immunities

David Bernstein at Volokh sketches out his argument for how the Court can hold that the Privileges or Immunities Clause protects a right to bear arms:

(a) the Court should take this opportunity to start to move its individual rights jurisprudence from the Due Process Clause to the P or I Clause;
(b) The problem with the D.P. Clause is that it traditionally prohibits “arbitrary” infringements on liberty, but arbitrariness is in the eye of the beholder, as is what is meant by “liberty,” see in both contexts Roe v. Wade;
(c) worse yet, cases like Roe fail to give any real weight to the police power, the traditional brake on the D.P. Clause;
(d) by contract, through historical investigation, we can determine with some precision what rights were considered privileges or immunities of citizens.  Abortion, (right to die, etc.) was not one of them!;
(e) Justice Field and Justice Bradley were correct in their SlaughterHouse dissents that one p or i of citizenship is the right to pursue an occupation  free from government-sponsored monopoly, a much narrower right than the later Lochner due process right to be free from arbitrary restrictions on liberty of contract, and a right that goes way back in Anglo-American history;
(f) the ultimate holding of SlaughterHouse was still correct, because Louisiana had a legitimate police power interest in ensuring that its waterways didn’t carry disease, and the butchers who sued weren’t driven out of the profession, they just had to work in the safe location dictated by the government.

Our article, in the Georgetown Journal of Law & Public Policy, titled Opening Pandora’s Box? Privileges or Immunities, The Constitution in 2020, and Properly Incorporating the Second Amendment touches (a), (b), (d).

David seeks to appeal “not just to originalism, but to the conservatives’ long-term political self-interest, and affinity for the conservative political coalition that put them in power.” This is precisely the tact we take.

The Court today more-or-less has 5 solid votes for incorporation. But as Justice Stevens and Ginsburg leave the Court, and Justice Scalia and Kennedy age, President Obama has the potential to totally transform the Judiciary. A future court could easily recognize a constitutional right to positive rights such as health care or social equality. Thus, we propose that the Court look to rights held as privileges or immunities during the time of Reconstruction, and not an evolving standard of rights (as articulated in Balkin’s work, and the Constitution in 2020 Project). If the Conservative majority takes a stand now, they can preserve an originalist jurisprudence for the forseeable future. If they punt, and let future Courts handle this, they are just waiting for Pandora’s Box to be opened.

McDonald and Overruling Slaughter-House. A Response to Professor Kerr

At Volokh, Orin Kerr gazes into his crystal ball to predict how the Supreme Court will respond to Gura’s arguments regarding the Second Amendment and the Privileges or Immunities Clause.

In summary, he predicts:

  • Thomas will vote in favor of P/I in light of his vote in Saenz
  • Scalia will not vote for P/I; Scalia thinks that Substantive Due Process is wrong, but will not overrule it becuase of the reliance interest built up over the years
  • Roberts and Alito, though Originalists, are not revolutionaries willing to give the judiciary the new power to “strike down legislation because it is inconsistent with’natural rights,’ including ‘the right to obtain happiness and safety,’ with some of those natural rights undefinable “in their entire extent and precise nature.”
  • Kennedy is not an originalist, and will incorporate through Due Process.
  • Stevens, Ginsburg, Breyer, and Sotomayor will view Gura breif as attempt to rehabilitate Lochner, and won’t buy it.

In an article I co-authored with Ilya Shapiro fortchoming in the Georgetown Journal of Law & Public Policy, titled Opening Pandora’s Box? Privileges or Immunities, The Constitution in 2020, and Properly Incorporating the Second Amendment we deal with a lot of these points, so I will try to summarize the argument here (we will be posting a PDF of the article later this week).

First, I think Orin presents a binary choice; incorporate through Due Process OR incorporate through privileges or immunities.  The question presented asked about both routes of incorporation. Neither path is by necessity mutually exclusive. As Gura’s brief makes clear, the Court could incorporate through the Due Process Clause, and alternatively recognize that the right to keep and bear arms is also among the Privileges or Immunities of Citizenship.  The Court need not displace 100 years of substantive due process jurisprudence with this single case. And from a practical perspective, basically the entire Bill of Rights has been incorporated. So, unless some people start clamoring about states quartering troops in theirs homes, this would be a one time deal. Such a holding would do little to upset the apple cart, or as we put it, open Pandora’s Box.

Second, I think Orin over-simplifies Scalia’s views on originalism and stare decisis. Our article shows that Scalia, while on the Supreme Court, has never voted in favor of a substantive due process incorporation. The last such case was in 1982. Can Scalia really cite the doctrine that he excoriated in Lawrence, Casey, and elsewhere based solely on reliance interests?  It is no secret Scalia likes guns, and he wants to incorporate the 2nd Amendment. But he does not want to enlarge substantive due process. Is he stuck between a rock and a substantively hard place? The Privileges or Immunities Clause provides an alternative method for Scalia. He could write a classic originalist opinion tracing the right to bear arms during Reconstruction, and find that it applies to the State.

Third, the Court does not need to rehabilitate Lochner (another shameless plug for David Bernstein’s forthcoming book). In fact, the Court can take a narrow view of Privileges or Immunities solely as an incorporative methodology, and leave to a later day the protection of substantive rights.  But this possibility raises another issue. While Orin is quite right to say the liberal Justices would be afraid to bring back Lochner, in a different case, the Justices may see the Privileges or Immunities Clause as a means to constitutionalize certain positive rights (welfare, education, health care, etc.). There is a growing body of literature, springing from the Constitution in 2020 project, that aims to use P/I as a means to elevate positive social rights to constitutional rights.

So, while Justice Breyer may not be willing to recognize the right to keep and bear arms as a Privilege or Immunity, the Court in a few years, with a much different composition, may be willing to recognize a constitutional right to health care, for example. While these types of arguments failed under due process and equal protection, privileges or immunities jurisprudence will be written on a clean slate.

For these reasons, and others mentioned in our article, we ask the Court not to punt on P/I for future generations, but rather to assert an originalist jurisprudence; namely, adopt the Washington v. Glucksberg test. By looking at only those rights deeply rooted in our nation’s history, the Court can find the right to keep and bear arms is such a right, and thus incorporate it to the state.