Property Rights

Norfolk, Virginia, While Abusing Eminent Domain To Seize 78-Year-Old Business, Attempts To Silence Free Speech

by Marc Scribner on June 18, 2012 · 19 comments

in Economy, Features, Property Rights

I’m a month behind on this story, but something terrible is underway in Norfolk, Virginia, that should disturb all Americans who value property rights and free speech. Central Radio Company, which first opened 78 years ago and has been at its current location of 1083 West 39th Street for 50 years, is currently under siege. First officials at the Norfolk Redevelopment and Housing Authority attempted to seize their property in order to transfer it to Old Dominion University, which currently has no specific site development plan for Central Radio’s property. The owners of the company, Bob Wilson and Kelly Dickinson, rightfully objected to the eminent domain proceedings. They then commissioned a 375-square-foot banner (left) and hung it on their building to protest the taking. Then this happened:

The banner worked. Almost immediately, Central Radio started getting calls and letters of support from Norfolk-area residents and businesses. And the banner itself has become a focal point for local groups opposed to the city’s abuse of its eminent-domain authority.

Not surprisingly, Norfolk officials have quickly moved to silence Central Radio. Two weeks after the banner went up, city inspectors cited Central Radio for displaying a sign larger than 60 square feet – even though ODU has several banners that are just as large on its buildings nearby. The city ordered Central Radio either to take down the banner by May 5 or be fined up to $1,000 per day.

Obeying the city would muzzle Central Radio’s free speech rights. Hoping to avoid the fate of the many other neighborhood buildings around Central Radio that have already been knocked down, the company is using the banner to send an important message that can be viewed from several hundred feet away.

A 60-square-foot banner would be virtually invisible to the thousands of people who pass by each day on busy Hampton Boulevard. And even if Central Radio could put up other signs elsewhere, they would not have the same impact as a banner located on the company’s own property.

Thankfully, Central Radio Co. is fighting back against these egregious constitutional abuses. In May, our friends at the libertarian public interest law firm Institute for Justice filed suit in federal court challenging the city’s take-down order on First Amendment grounds. IJ is hosting a rally and picnic on July 5 at Central Radio Company (Facebook Event link). We strongly support Messrs. Wilson and Dickinson in their fight to protect their rights to property and free speech from Norfolk’s government thugs.

Losing the Universe with LOST

by Rand Simberg on June 15, 2012 · 3 comments

in Deregulate to Stimulate, Features, Property Rights, Space

Post image for Losing the Universe with LOST

The Law of the Sea Treaty (LOST) has been languishing in the Senate for decades, but led by Massachusetts senator John Kerry, there is growing (and unfortunately) bipartisan support to finally ratify it. Condi Rice’s State Department favored ratification in the Bush administration, and (soon-to-be-ex) Republican Senator Richard Lugar of Indiana has been one of Kerry’s key allies in the effort. But yesterday, Don Rumsfeld testified that such an act could have dire consequences:

“[Lady Thatcher] said what this treaty proposes is nothing less than the international nationalization of roughly two-thirds of the earth’s surface,” he said. “The major idea underlying the Law of the Sea Treaty is that the richest of the oceans, beyond national boundaries, are the common heritage of mankind. And thus supposedly owned by all people. Actually, it means they’re un-owned.”

Rumsfeld called “an idea of enormous consequence” the fact that “anyone who finds a way to make use of such riches by applying their labor or their technology or their risk-taking are required to pay writ royalties of unknown amounts, potentially billions, possibly even tens of billions over an extended period, an ill-defined period of time, to the new International Seabed Authority for distribution to less developed countries.”

Saying that this principle has “no clear limits,” he mused that it could set a precedent for space exploration, too.

Indeed it could, and a disastrous one for space development and settlement.

A crucial distinction between the Outer Space Treaty, to which the U.S. is a signatory, and does not explicitly outlaw private space property rights, and the Moon Treaty, to which the U.S. has not acceded, is the phrase “common heritage of mankind.” The latter (and LOST) contains it, while the former uses, in Article I, the more innocuous “province of all mankind.”

What’s the difference? “Common heritage” is intrinsically Marxist and redistributionist in nature, whereas “province” simply means that, like “the pursuit of happiness,” it is potentially available to all. LOST was in fact the model for the Moon Treaty, and both had a similar goal — to provide a slush fund for the “regime” established to “regulate” access to resources and ensure their “fair” distribution to poorer nations, and not coincidentally, provide a steady source of revenue for the U.N. independent from any national contribution, as a key step toward establishing it as a world government.

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Legislators Seek to Create New, Unnecessary Protected Class: Gun Owners

by Hans Bader on June 13, 2012 · 9 comments

in Economy, Legal, Personal Liberty, Property Rights

Generally, the Constitution only binds the government, not the private sector. For example, the First Amendment protects speech, and even insults, but that doesn’t mean you can’t kick someone out of your home or business for insulting you. But Missouri legislators have decided to turn gun owners into a protected class, citing the Second Amendment — which only applies against the government — as a reason to restrict private employer policies regarding firearms. As Missouri Freedom Watch notes,

HB 1621, which passed the Missouri House 115-36, makes it unlawful for an employer to fail to hire, discharge, or otherwise discriminate against an employee because that employee “has a concealed carry endorsement or uses his or her firearm for lawful purposes.”  In effect, the bill makes it unlawful for an employer to discriminate against gun owners in the terms and conditions of their employment.

While it is certainly comedic that Missouri Republicans want to attack the non-existant problem of employment discrimination against gun owners, Missourians should be more troubled by Rep. Brown’s justification–the Second Amendment.  The Second Amendment protects a citizen’s right to bear arms from government intrusion.  But it does not impact the ability of private citizens to place restrictions on guns.

Employers have an absolute interest in preventing violence in the workplace.  Indeed, many employers have policies restricting employees from bringing weapons into the workplace–including policies prohibiting workers from storing weapons in their vehicles in the parking lot.  If HB 1621 were to become Missouri law, those legitimate policies could conceivably be used as evidence of an employer’s intent to discriminate against gun owners.

By placing gun-owner “rights” above the rights of property owners to control the manner in which persons enter and interact on their property, HB 1621 makes Missourians less free.

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Remembering Elinor Ostrom

by Fred Smith on June 12, 2012

in Economy, Environment, Features, Natural Resources, Personal Liberty, Private Conservation, Property Rights, Zeitgeist

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Among the individuals with whom I wish I could have greater opportunities to exchange ideas is Elinor Ostrom. She passed away today, and now I must pursue that conversation indirectly — via her writings, her colleagues, and my recollections of those few conversations I did have the opportunity to enjoy.

Her work — for which she received the Nobel Prize in Economics – dealt with the way in which cultural enclaves often evolved institutional and technological solutions to resource management. And, not surprisingly, ideologues of various sorts claimed her work validated their world view.

Communitarians saw her work as “proving” that the classical liberal institutional view of private property, based on a formal rule of law, was not essential to ensure efficient allocation of resources. All one needed, they claimed, was to return to the common property world of yesteryear. Conservative agrarians also found much support from her research for their perspective. And, indeed, her work could be read that way – but it didn’t have to be.

Classical liberals, myself included, viewed her work far differently — as  evidence that the core institutions of a liberal world had developed (in embryonic form) much earlier than first thought. They were not imposed from above, but rather evolved as man began the long path toward modernity.

Moreover, some of her work did touch upon modern property rights — illustrating how commons could evolve into properties that could be restricted by use, by time, and in other ways that moved toward the formal property rights of today, ultimately meeting my friend Rick Stroup’s 3-D definition of property — definable, defensible, and divestible.

CEI’s Center for Private Conservation benefited greatly from some her insights. Once, she and Vincent, her husband, visited CEI and gave an impromptu seminar.

One question that I wished I’d pursued further with her concerns the transition from tribal common property management regimes to the modern private property regimes of today. Under what conditions do such transitions occur? What leads groups to accept a shift of this sort and what advantages (and penalties) does it create?

My own thoughts are that culturally enforced resource management rules can often be very creative and efficient — still, they rely on the culture being closed to outside transactions with others not sharing these cultural values. In a global mobile society, this suggests such closed systems are not likely to survive. However, unless the conditions for the transition to the modern formal rules have arrived, the situation can actually worsen. Fisheries, tropical forests, wildlife — all illustrate how the Tragedy of the Commons re-emerges when the old order collapses without anything to take its place.

Thus, CEI’s interest in pursuing the question: How can one assist isolated tribal enclaves to join an open world economy — when that shift is wise? The question is relevant in many areas of policy: how to better allocate the electromagnetic spectrum, offshore fisheries,  surface waters, and myriad other areas where property rights remain somewhere between the cultural controls Ostrom explored and those favored by classical liberals.

The right to trade a resource that is often restricted to one class of users (agricultural uses of water, for example) might be extended to urban or industrial users, but that liberalization threatens existing  arrangements and requires some trust that the new rules will be at least as effective. The very slow evolution of such liberalized trading policies suggests how little we understand social change. Ostrom had much to say about all this, and left us a rich legacy on which to ponder.

Tapping Space Resources

by Rand Simberg on June 7, 2012 · 1 comment

in Deregulate to Stimulate, Property Rights, Space

Over at The Washington Times, Bob Zubrin says that we need space property rights. Gee, I wonder where he got that idea?

New Space Property Rights Criticism

by Rand Simberg on June 1, 2012 · 12 comments

in Property Rights, Space

Over at the Space and Cyberlaw blog, Eric Dawson takes issue with my issue analysis on space property rights:

Foremost, I think the terminology used by Mr. Simberg is disingenuous. The proposed legislation, as I read it, does not create a property right at all. By describing it as such, I believe Mr. Simberg is concealing some of the more important areas of the discussion. A property right has no value if it does not protect your interests from third parties. To grant a property right, a nation must have sovereignty or control over the property in question, otherwise the grant is meaningless. Assuming that the legislation is not intended to be meaningless, what would actually happen under this proposal is that the United States would essentially promise not to take military or other action to remove a private party from a portion of a celestial body. Ignoring space law for the moment, and acknowledging that I am not a Constitutional scholar, I have serious concerns that such a piece of legislation would be constitutional. This is because it appears to be an attempt to limit the President’s commander-in-chief and foreign affairs powers.

Setting aside what I think is an unfair accusation of disingenuity, this is simply wrong. The legislation makes no “promise” to not take military or other action. It simply refuses to promise to do so. As I note in the paper, how the U.S. government would respond to a transgression against a recognized property owner, or whether it would, is completely unspecified by the proposed legislation — it would be a political decision taken at the time of the encroachment. For the government to recognize the right of an owner to lunar real estate is no more an “appropriation” or declaration of sovereignty than is our recognition of Israel or Taiwan’s right to exist. Surely Mr. Dawson isn’t saying that our stance toward those two nations represents a declaration of sovereignty over them? He goes on to repeat the (in my opinion of course) flawed argument that the combination of Articles II and VI create a de facto violation of the Outer Space Treaty by an individual property claim:

The OST prohibits national appropriation of outer space and celestial bodies through any means. Remember also that nations are responsible for the space activities of their nationals. If we accept that the US would not actually be granting a property right, but rather refraining from enforcing the provisions of the OST against appropriation, then it couldn’t really be accused of appropriation itself unless the private party were its own citizen (I’ll get back to this issue in a bit). There are no provisions of the OST that require a State Party to take actions enforcing the Treaty. If China were to claim the entirety of the moon tomorrow, the US would not be required to respond. That is a political decision. However, I believe that passing a law stating that the US would systematically ignore repeated violations of the Treaty’s provisions would very much go against the object and purpose of the OST. All signatories to a treaty have the minimal obligation of not violating a treaty’s object and purpose.

Again, there is confusion here. The legislation does not provide a way for the the U.S. to “grant” a property right — it cannot do so without a sovereignty claim, which would be a treaty violation. It simply requires that such a right be recognized by the U.S. government. And it doesn’t require that the U.S. “systematically ignore repeated violations of the Treaty’s provisions,” because there is nothing in the treaty that prohibits private claims — only national ones. It is in fact possible for citizens of a States Party to the treaty to do things that the States Party itself cannot. This is elaborated upon in a long blog post by the original author of the proposed legislation.

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Amendments That Take Away Rights

by Hans Bader on May 9, 2012 · 1 comment

in Economy, Legal, Personal Liberty, Politics as Usual, Property Rights, Zeitgeist

The Supreme Court, like European courts, has long recognized that corporations have constitutional rights, ever since its 6-to-1 decision in Dartmouth College v. Woodward (1819). But left-wing ideologues have falsely claimed that corporate constitutional rights are a recent invention by right-wing Supreme Court justices, in response to the Supreme Court’s 2010 ruling in Citizens United v. Federal Election Commission, which ruled that corporations and unions have the right to criticize politicians even when doing so involves spending money (that case involved a non-profit ideological corporation that wanted to air a film critical of Hillary Clinton and to advertise the film during television broadcasts. In response, the government argued that it could not only restrict such paid expression, but also restrict even books critical of politicians during an election campaign).

Although the Citizens United decision did not say that corporations are “people,” some of its critics have claimed that it did, and they have drafted something called the “People’s Rights Amendment,” which would permit the government not only to censor corporate speech, but also to seize and nationalize corporate property without compensation, under the theory that corporations are not people and thus have no constitutional rights at all. (The People’s Rights Amendment takes away the rights of non-profit corporations, which include most churches, colleges, charities, political parties, and campaign committees. Most newspapers, magazines, and broadcasters today are corporations, unlike back in 1789, when the press was not incorporated.)

Amazingly, three state legislatures — Vermont, Hawaii, and New Mexico — have passed resolutions in support of the People’s Rights Amendment, which is worthy of a Communist People’s Republic. And 28 members of the House of Representatives (all but one of them liberals) are sponsoring the People’s Rights Amendment in Congress. (Citizens United was not even the first Supreme Court decision to rule in favor of a corporation’s challenge to a speech restriction. Earlier cases like First National Bank of Boston v. Bellotti had done so, without controversy.)

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How to Fix U.S. Water Policy? Less Government, More Market Pricing

by Wayne Crews on April 18, 2012

in Deregulate to Stimulate, Economy, Environment, Features, Natural Resources, Property Rights, Regulation

Post image for How to Fix U.S. Water Policy? Less Government, More Market Pricing

Late last week I received an invitation to testify in the Water and Power Subcommittee of the House of Representatives Natural Resources Committee on H.R. 2664, “The Reauthorization of Water Desalination Act of 2011.” We’ve posted the full 20-page testimony; my oral remarks before the committee appear below. The push for politically juiced desalination projects is a diversion from the actual problem; the absence of market pricing to allocate water scarcity.

I am Wayne Crews, VP for Policy at the Competitive Enterprise Institute and I thank the committee for this Tax Day invitation to speak on H.R 2664, a $2 million annual desalination program that, while it won’t break the bank, embraces principles at variance with a lightly regulated and adaptable water sector.

While it does boast crucial working applications, desalination remains an energy-intensive, by-product-laden means of making expensive usable water, despite being an ancient process.

Happily, there’s no need for panic; Water is not getting more scarce overall; it’s an earthly constant, and the nation uses even less than it did in the 1980s.

But pricing and allocation of that supply do matter. To advance tomorrow’s water policy, we must, as we say at CEI, avoid having government steer while the market rows.

When linking research like desalination to human needs, private investors can test low-probability projects, counting on the rare success to offset multiple failures. Progress requires good at killing bad projects.

Federal funding to overcome so-called “market failure” in research, on the other hand, fosters numerous avoidable conflicts: over the merits of basic vs. applied research, over government vs. industry science; over assignment of intellectual property; Over public access to data. Meanwhile, taxpayer subsidies appear not to alter the ratio of GDP spent on R&D after all.

Government steering can create artificial booms, and politics has trouble balancing research portfolio tradeoffs: Why H.R. 2664’s brackish groundwater desalination instead of seawater or countless alternative water investments? The problem affects other sectors: Why nanotechnology instead of biotech? Or the hydrogen economy? Or Robotics?

We should avoid fostering a “Declaration of Dependence” on federal dollars, because that will further mask water market prices.

Also, even as government funding comes with regulatory strings attached, it adds to risks and environmental problems by propelling risky technologies ahead of the free market’s ability to properly assimilate them. (The market’s role in regulation is something we might discuss in Q&A.)

This is important, because we observe in H.R. 2664 the seeds for new regulation propelled by the sourcing and externalities of desalination itself. Instead, market disciplines like liability and insurance must evolve alongside technology.

To me, preferred alternatives to subsidized Desalination are those institutionalizing the separation of water and state.

First, better pricing of existing supplies can make crises vanish; refer to my written testimony on this. Despite everything, gallons of water cost less than a penny, filling swimming pools and hydrating lush lawns in arid areas.

Second, improving infrastructure can reduce the waste that now depletes 17 percent of the annual water supply, as noted in a new CEI report by Bonner Cohen.

Third, better transport, including pipelines, trucking, and crude oil carriers can aid supply. Where’s the water pipeline aorta alongside and perpendicular to Keystone, one might say.

Fourth, improved trade between cities, farmers and NGOs can be essential to pricing and value.

A fifth option would be water sourcing alternatives including gray and wastewater treatment and reclamation; stormwater harvesting, and private conservation such as instream flow purchases.

Finally, we should reduce onerous permitting regulations that inflate desalination’s costs and defy the good in the H.R. 2664 vision. Otherwise, as water expert David Zetland notes, “if it’s possible to get [regulatory permitting] approval [to] raise prices so far, why not just raise prices and skip the project?”

A couple general observations:

First, as CEI’s president Fred L. Smith Jr. puts it, instead of trying to improve speeds by picking the particular R&D horses to run on the infrastructure racetrack, improve the business and regulatory track so everyone can go faster, and let jockeys keep more of their earnings. In the Appendix of my written testimony, I cover liberalization options to better enable a private sector flush with research cash.

Second, this is the water and power subcommittee, and I think it’s vital to step back and explore dismantling regulatory silos artificially separating our great network industries. That is, any investment in non-shovel-ready desalination while settling for 19th and 20th century infrastructure is sub-prime policy, particularly given that, as a free society becomes wealthier, creation of infrastructure should become easier, not harder.

The America of 100 years ago, with its paltry GDP, built overlapping, tangled infrastructure; we might have had an aesthetic problem, but never a natural monopoly problem.

The modern challenge is to welcome water resources further into the market process. We urgently need competitive market discipline to discover, not just desalination’s value relative to sourcing alternatives, but to discover the true value of water itself.

The Space Property Rights Discussion Continues

by Rand Simberg on April 16, 2012 · 4 comments

in Features, Property Rights, Space

Post image for The Space Property Rights Discussion Continues

As I (sort of) predicted last week, Tanja Masson-Zwaan, president of the International Institute of Space Law, has weighed in on the issue in an interview with Alan Boyle at MSNBC.com:

Masson-Zwaan told me trying to get around the 1967 treaty is “not the solution.”

“Things have to be agreed on an international level,” she said. “I don’t think that the treaty has any kind of ‘loophole.’”

The idea behind the Space Settlement Prize Act is that the Outer Space Treaty bars its signatories, including the United States, from asserting sovereignty over other worlds, but may not bar them from recognizing claims made by private parties. The act’s backers note that a follow-on treaty, drawn up in 1979 and known as the Moon Treaty, specifically bans private property claims — and note that the United States is not a party to that particular pact.

Wouldn’t that imply that the United States still has a free hand on private property claims? Masson-Zwaan says no. She says the private-property angle is addressed by the Outer Space Treaty, and merely reiterated in the later Moon Treaty. “It’s often so in treaties,” she said.

The key to her argument is that Article 2 of the 1967 treaty holds nations responsible for the extraterrestrial activities of their citizens. And it’s not just her arguing that. This is the view of other legal experts, including TechFreedom’s James Dunstan. (Masson-Zwaan said Dunstan’s comments were “quite well worded.”) What’s more, it’s been the stated view of the U.S. government. In 2003, a State Department official cited Article 2 in turning back a claim for parking and storage fees relating to NASA’s NEAR Shoemaker spacecraft on the asteroid Eros.

Note that I addressed the Article II argument both in the Issue Analysis and in my rebuttal to its repetition. Also, while I didn’t mention in the analysis the State Department opinion on the Eros case, it was only that — an opinion of an official, and I noted that it was not at issue in the case, (as does Alan Boyle):

A later ruling in federal court rejected the claim on different grounds, saying that the claimant failed to show any property interest in Eros.

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Further Space Property Rights Responses

by Rand Simberg on April 9, 2012 · 4 comments

in Deregulate to Stimulate, Natural Resources, Property Rights, Space

Since my previous post on media reaction to CEI’s press briefing on Thursday, Popular Science has provided a good report as well.

But in this post, I want to address co-speaker Jim Dunstan’s critique of the concept, which he presented at the event, and is now available on line at TechFreedom.

I should start by noting that Jim is a long-time associate, fellow free-market space advocate, and (I hope) friend. I didn’t want to get into the weeds of a debate on the subject at the event, particularly because he didn’t put forth any new arguments — his statement was simply a reiteration of the argument that I had already refuted in the paper itself. But briefly, like other critics, he cites the combination of Articles II and VI of the Outer Space Treaty to debunk the potential loophole that I postulate in the Issue Analysis:

The negotiators of the Outer Space Treaty (OST) knew that such [property rights] claims would never stop unless the countries agreed once and for all, that:

Outer space, including the [M]oon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other
means.

Article II of the OST couldn’t make it any clearer.

But wait, Rand and others argue that Article II of the OST only prohibits national appropriation, so individuals are free to do whatever they want in space. Well, not so fast. Article VI of the OST states:

States Parties to the Treaty shall bear international responsibility for national activities in outer space, including the [M]oon and other celestial bodies, whether such activities are carried on by governmental agencies or by nongovernmental entities, and for assuring that national activities are carried out in conformity with the provisions set forth in the present Treaty.

Since launching states are required to ensure that their nationals conduct their activities in conformity with the provisions of the OST, and the OST denies states the ability to appropriate celestial bodies through use, occupation, or by any other means, there is no way that the United States could directly recognize land claims in outer space that were made based on use and occupation, as the legislation Rand proposes would do. The “loophole,” as Rand calls it, simply doesn’t exist.

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