#27 Summer 2000
THE RISE OF THE "TAKINGS" CLAUSE (Part 2)
l TAFOL ELECTS NEW BOARD OF DIRECTORS AND
2000 Page 1
RISE OF THE "TAKINGS" CLAUSE
- Part 2:
Takings" Reform is Undercut by Relativism
By Larry Salzman
part of this article summarized how, although property rights
have never been
completely protected, they received good
protection in the 19th Century. Beginning with the 20th Century,
the protection deteriorated until virtually no property was safe
from the state's "police power": the power to regulate
for the "good of the community."
In 1982, the
Supreme Court began to reverse this policy. This reversal was
pro-property rights reformers whose strategy
was to reduce the scope of the "police power." The leading
case that resulted from their efforts is Lucas v. South Carolina
Coastal Commission, 505 U.S. 1003 (1992) which, in an opinion authored
by Justice Antonin Scalia and relying on the common law of nuisance,
held that a South Carolina regulatory agency should be ordered
to compensate a landowner for losses resulting from prohibiting
him from building two homes on the edge of his eroding beachfront
As most commentators
suggest, Justice Scalia's ruling in Lucas may be the high-water
mark for the modern reform of the "takings" clause.
Its explicit reliance on the common law of nuisance takes an important
step forward defending property rights.
of the "takings" reformers was to launch
the return of property rights by calling upon courts to shrink
the "police power," the power of the state to regulate
without compensating the regulated individual. If the power could
be reined in, governments could avoid liability for confiscations,
and for restrictions on the use of property, only by regulating
statement of this reform was presented to the Court in an amicus
curiae brief by a pro-capitalist public interest
law firm, The Institute for Justice. The brief was authored, in
part, by Richard Epstein, one of the most radical fathers of the "takings" reform
movement and renowned for his influential text, Takings, published
in 1987. In this brief, the Institute argued that the state must
compensate an owner for every deprivation of an "ordinary" use
of his property caused by virtually any regulation. "Ordinary" in
this context denoted uses that did not violate traditional, usually
objective, nuisance laws.
almost worked. The reasoning of the Lucas decision tracks closely
elements of the Institute's brief---with a crucial
limitation: The rule, incredibly, is limited only to cases where "the
State seeks to sustain regulation that deprives land of all economically
beneficial use."1 It gives no security to the owner who is
deprived of any less of the productive use of his land.
it applies in no way to personal property where, "by
reason of the State's traditionally
2000 Page 2
of control over commercial dealings, [the owner] ought to be
aware of the possibility that new regulation might
his property economically worthless."2
Lucas and its progeny have not eliminated the vast majority of
uncompensated "takings," and the number of
compensated "takings" has skyrocketed during the past
20 years. Among the continuing compensated "takings" are "redevelopment" projects
that include the forced sale of land from one private owner to
another facilitated by the power of eminent domain. In the realm
of uncompensated "takings," one finds new rent control
laws, in some cities so onerous that they force landlords to rent
at actual financial losses; an increase in building or city blocks
labeled historic imposing building moratoriums and direct costs
on their owners; a massive increase in the acreage defined as "wetlands," obligating
owners to remove those segments of their land from productive use.3
Lucas is mischaracterized as giving teeth to the "takings" clause.
It is, rather, a pathetic assertion of judicial review over more
than one hundred years of relentless, unconstitutional legislative
degradation of property rights.
Despite its timidity and certain contrary language in the opinion,
Lucas was a break from precedent. Having already broken from tradition,
one wonders why the Court would have limited limit itself in this
way. In fact, the trend of the prior few years indicates that a
majority of the Court may have been looking to strike a bold rule
in favor of property rights. So why did the Court squander this
lies in the legal doctrine of "judicial restraint." A
proper interpretation of this policy has its source in the principle
of separation of powers. Originally, when commentators recommended
that the judiciary show "restraint," they generally
meant that the Court should respect its Constitutional role.
That is, it should neither legislate nor enforce laws, but adjudicate
according to the laws---including rendering null those federal
statutes exercising powers not enumerated by the Constitution.
The attitude was stated early by Chief Justice John Marshall
who boasted that during his tenure, the Court "never sought
to enlarge the judicial power beyond its proper bounds, nor feared
to carry it to the fullest extent that duty required."4
It also meant that the Court ought not make a broad Constitutional
rule where prudence suggested relying on state or federal statutory
Century courts regularly nullified acts of the legislature, especially
those regulating property and economic liberty, as unconstitutional.
It accepted the Constitution and an implicit natural rights legal
philosophy as its guide: "To sustain the individual freedom
of action contemplated by the Constitution is not to strike down
the common good but to exalt it."5 The famous Lochner6 case
typified the practice. Lochner centered on a challenge to a New
York statute prohibiting bakers from working more than 10 hours
per day or sixty hours per week. The Court struck down this law
as a violation of liberty of contract. It had no qualm about its
moral authority to do so.
In the 1930s,
such rulings became an increasing barrier to the New Deal. And
as FDR and Congress worked to undermine capitalism,
the Court often found itself obligated to strike down programs
that enjoyed very wide (if appalling) popular support. As program
after program was invalidated, many persons---ignorant of, or antagonistic
to individual rights---began to ask a basic political question:
by what authority do nine unelected judges claim the power to override
2000 Page 3
and popular majorities?
refrain was that the court had no such authority. The culmination
the dispute was his infamous "court packing" scheme
in which he threatened to appoint one new sympathetic Justice to
the Supreme Court for each current member voting against New Deal
legislation---effectively eliminating the Court's independence
and exempting New Deal programs from judicial review. Faced with
its destruction, and with no explicit, philosophic understanding
of individual rights, the Court capitulated.
restraint became: "A state is free to adopt whatever
economic policy may be reasonably deemed to promote public welfare,
and to enforce that policy by legislation adapted to its
purpose. The courts are without authority either to declare such
policy, or, when it is declared by the legislature, to override
it."7 An exception may be made, the Court noted, where legislative
actions were "palpably in excess of legislative power."8
stay within its authority, the Court, it was thereafter said,
should give "deference" to the legislative enactments.
It must not, as in Lochner, "imperiously" declare its
own view of what legislative acts the Constitution prohibits. The
judiciary must show "restraint." The new policy accepted
the idea that there is no objective meaning to the Constitution,
nor to rights, that there is only a competition of "will"---that
of the legislature and that of the Court. A key source of modern "restraint" is
this moral relativism.
Yet the Declaration of Independence and the Constitution speak
clearly of rights. And it was not certain how rights fit in with
the Court's new approach. The Court continued to use the terminology,
if not the substance, of rights.
In 1938, the
Court clarified its view with its ruling in United States
Products.9 The case was a fairly routine challenge
to a New Deal era law regulating the dairy industry. As an aside,
in a single footnote, the court announced a dichotomy of rights,
separating them into two classes: fundamental and non-fundamental.
A law attacked as violating a non-fundamental right is subject
to a "presumption of Constitutionality." This meant that
laws affecting the rights regarded as "non-fundamental" would
almost never be struck down unless their victims could show essentially
that no argument supported by even the barest shred of fact could
be made in favor of the legislation. But "fundamental rights," specifically
those identified in the first eight amendments (arbitrarily excepting
economic and property rights) might receive some greater degree
of judicial review. This footnote now rules the adjudication of
virtually every Constitutional case brought before the federal
judges on the "left," the entire scheme has
not only been accepted, but championed with far greater moral fervor,
by those on the "right."11 The doctrine that undercut
rights to make way for collectivist economic policies works equally
to undercut rights for collectivist social policies. So while liberals
complain that Lochner allowed "activist judges" to stop "the
public" from determining the nation's economic policy, conservatives
today complain that "activist judges," through Roe
v. Wade, for instance, stop "the public" from preventing
abortion in those states where a majority would outlaw the procedure.
Both argue against "judicial activism" in favor of "judicial
restraint."12 Justice Scalia is today among the foremost advocates
of "restraint." This explains
his Lucas opinion. Finding nothing in the first eight
amendments about a prohibition on the building of
2000 Page 4
the regulation of personal property, he regards striking down
such legislative acts as a judicial usurpation
authority. However, where the government deprives landowners
of 100% of their property, he can find a role for the Court.
deprivations are "palpably excessive" and therefore fall
within the authority of judges.
As a conservative,
what little authority to defend the right to property Justice
Scalia accepts is found not in morality, but in
common law (i.e. tradition). And by his reading, there is not sufficient
tradition to protect less than total "takings," or personal
property, from state control. So, in fidelity to his ideal, he
exempts these objects from the Lucas rule.
illustrates why legal reform requires more than tinkering with
the "takings" clause.
To save the right to property
---and, ultimately, all other rights---the tradition-bound mind
of Justice Scalia is insufficient. The task requires a total repudiation
of the modern doctrine of judicial restraint and a defense of the
moral legitimacy of the judiciary as a co-equal branch of government.
Only then can we begin reforming the adjudication of specific Constitutional
The philosophic collapse of the judiciary's authority was made
final during the New Deal. To restore it, we must answer the crucial
question common at that time: by what authority do nine unelected
judges claim the power to override the will of legislative and
is, of course, by right. The full defense of that authority was
to New Deal era thinkers---it required Ayn Rand.
It requires the knowledge that rights are not subjective, but objective
requirements of society. It requires Ayn Rand's full, philosophic
defense of rights that Jefferson could describe only as "self-evident."13
of America's brilliant separation of powers doctrine was not
goal of balancing judicial versus legislative "will," but
of subordinating both to moral law.
Judges must look to the objective theory of rights to anchor the
meaning of the Constitution. The Declaration implicitly served
this purpose for the best 19th Century judges. But the legal philosophy
of the Enlightenment could not live long into the 20th Century
after the 19th Century collapse of the philosophy's fundamental
against property rights---against all rights---has been so successful
in law largely because the guardians of rights
were morally disarmed. Objectivism is uniquely able to restore
to 21st Century judges the vital moral confidence of their 19th
Century counterparts. And more, they will be securely armed against
the anti-rights assaults that destroyed their forebears.
1. 505 U.S. 1003. 1027 (1992) (Emphasis in original). The
decision also parts company with the Institute's brief in
additional important, but less fundamental, aspects.
3. For examples
of each, see generally Bernard H. Siegan. Property and Freedom, 111-228 (1997).
in Siegan at 50.
v. Children's Hospital of the District of Columbia.
261 U.S. 525. 560 (1923)
v. New York, 198 U.S. 45 (1905)
v. New York, 291 U.S. 502. 537 (1934)
8. Id. at
9. 304 U.S.
2000 Page 5
10. See Roger
Pilon. "Essay: A Court Without a Compass," N. Y.
Law School L. Rev. 40,999. 1002-1004 (1996) (briefly
identifying key 1930s roots of modern Constitutional law).
11. The paradigmatic
example of this phenomenon is Robert
H. Bork, Slouching Toward Gomorrah (1996).
12. Id. See
also generally Robert H. Bork, The Tempting of
13. See Ayn
Rand "Man's Rights," Capitalism: The Unknown
Ideal, (1967); see also Leonard Peikoff, Objectivism:
The Philosophy of Ayn Rand, 351-369 (1991).
Under the American Constitution, each person is governed by two
governments---the federal government and a state. This is called
federalism. Under this scheme, the federal government may exercise
only those powers specifically granted to it in the Constitution;
all other powers are exercised by state governments.1 Federal powers
fall under three general categories: (1) laws which require uniform
nationwide application (naturalization, e.g.), (2) foreign relations,
(3) administration of the federal government.
ordinary crimes (murder, assaults, thefts, . . . ) are prosecuted
by the states. However, for a number of years, there
has been a trend to expand the areas in which the federal government
legislates. An example is the Violence Against
Women Act (VAWA) of 1994. VAWA allows the victim of
any "crime of violence motivated by gender" to bring
a federal suit.
question arises: how does one support federal jurisdiction in
this area? The answer is, in part: by the Constitution's Commerce
Clause which grants the federal government the power "To
regulate commerce . . . among the several states."
In the 19th
Century, this claim would have received respectful consideration
no one with any legal knowledge. However, beginning
in the 1930s, the "Roosevelt Court" expanded the scope
of this Clause to the extent that virtually no activity was immune
from federal regulation. The archetypal example was a 1942 decision
in which the federal government was allowed to penalize a farmer
for raising an "excess" amount of wheat to feed his family
and his animals.2
Some sanity is returning. On May 15, 2000, the Supreme Court,
in United States v. Morrison,3 held VAWA unconstitutional on grounds
the Constitution reserved this power to the states. The Court had
reached a similar result in 19954 by holding unconstitutional a
federal act limiting guns on and near schools.
The Plaintiff in Morrison sued a university and others on the
basis of her having been the victim of a rape on its grounds. In
denying jurisdiction, the Court pointed out that, if the federal
government could exercise authority over the acts alleged in this
case, then any acts whatsoever come under Commerce Clause.
TAFOL expects to explore the issue of federalism in more detail
in a future issue of this Bulletin.
1. See Tenth Amendment.
v. Filburn, 317 U.S. 11 1 (1942)
[pdf link is bad]
States v. Lopez, 514 U.S. 549 (1995)
2000 Page 6
NEW BOARD OF DIRECTORS AND OFFICERS
Jim McCrory, Mike Conger and Dee Tagliavia have been elected to
serve on TAFOL's Board of Directors. The Board elected the following
Vice Presidents---Mike Conger and Steve Plafker
The position of Bulletin Editor was also created, and Steve Plafker
has been named to that position.
Copyright © 2000
The Association for Objective Law. All rights reserved. The Association
for Objective Law is a Missouri non-profit
corporation whose purpose is to advance Objectivism, the philosophy
of Ayn Rand, as the basis of a proper legal system.