Everything you say can and will be used against you.

Tuesday, June 06, 2017

Box Seats for an Angry Zeitgeist

Laws are sand, customs are rock. Laws can be evaded and punishment escaped, but an openly transgressed custom brings sure punishment. Mark Twain
Let me write the songs of a nation, and I care not who writes its laws. Scottish politician Andrew Fletcher

If law, like politics, is downstream of culture, get ready for some backflow: the Supreme Court’s reviled 2005 eminent-domain decision Kelo v. New London is now a motion picture. Korchula Productions’ Little Pink House — referring to Suzette Kelo’s home taken by her city and given to Pfizer Corp — premiered in February at the Santa Barbara International Film Festival. Korchula is working on bringing Little Pink House to more markets. This, at least, is an improvement on Pfizer’s plans, who opted to take the little pink house off the market, and indeed, out of existence.

Top: Korchula’s Little Pink House
Bottom: Pfizer’s little pink house (credit: Ilya Somin).

One poll found that more than 80 percent of Americans disapproved the Kelo decision. At least 45 states passed eminent domain reform laws in reaction. Korchula is betting that anger will fill theater seats.

We had similar stories in California that gave an Orwellian lie to the activity known as “redevelopment.” Filipino Baptist’s property in Long Beach had been developed as a church, but the city in 2006 proposed it be re-developed as condos. Polish immigrants developed a community of homes and businesses and churches, and Detroit re-developed it as a Buick factory. (The legal industry fondly remembers the case with a commemorative plaque, on which the 2004 decision reversing it reads like a footnote.) In a different context, when a passenger was accommodated onto a flight, United Airlines haplessly proposed to “re-accommodate” him, kicking and screaming, back off it.

Also on point is the tale told in 99 Cents Only Stores v. Lancaster Redevelopment. In its first full year of business in 1998, the 99 Cents Only store in the north Los Angeles city of Lancaster did over $5 million in sales. This was welcome news to the city, given the space had been vacant ever since the new “Power Center” shopping development, where 99 Cents was located, opened ten years earlier. Almost immediately, however, 99 Cents’ next door neighbor, Costco, told the city it needed to expand. The owner of the center offered Costco optimal space behind 99 Cents, but Costco insisted that the city use its power of eminent domain to condemn 99 Cents’ business. If the city refused, Costco threatened to relocate to neighboring Palmdale, who surely would use every tool at its disposal to attract the lucrative big box store’s business. To seal the deal, Costco issued an additional threat: not only would it relocate to Palmdale—it would leave its existing store shuttered and vacant as an economic deadweight on the city’s key commercial center. Backed against the wall, the terrified city relented. It condemned 99 Cents’ store, paid the shopping center owner $3.8 million, and gave the parcel to Costco for one dollar.

You developed your business, and the city re-develops it as the other guy’s business.

California was the first state to adopt a Community Redevelopment Act, in 1945, which gave cities and counties the ability to establish redevelopment agencies. A half-century later, it was generating a steady stream of dystopic race-to-the-bottom stories and a growing public backlash. California abolished the redevelopment agencies in 2011. For state budgetary reasons rather than the right ones, of course, but a win’s a win.

Public disapproval more recently took aim at banking and lending practices, and the law likewise continues to respond: The U.S. Supreme Court recently ruled in a pair of cases that cities can now sue banks for discriminatory lending that harmed the city’s tax base by causing property values to fall. Can cities actually prove this? In a summary-judgment motion, the odds aren’t good. But think a jury might include a few homeowners with less than warm affection for banks? You bet. Courthouses might be “palaces of justice,” as Judge Kozinski recently called them, but there’s still box seats for an angry slice of zeitgeist.

When Solon, the great Athenian lawmaker, was asked whether he had given to the Athenians the best laws he could devise, he replied that he had given them instead “the best they w[ou]ld receive.’” Solon recognized that laws must not only be just, but they must be agreeable to those they mean to govern. A good law people will not accept is not, in the end, a very good law at all.

Law is still downstream of culture, so beware the backflow.


L May said...

Lex dura, sed lex

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