no third solution

Blogging about liberty, anarchy, economics and politics

Fair Market Value

November 7th, 2005

Oakland, CA, is the latest on the list of municipalities to abuse excercise its power of Eminent Domain. Set aside, for a second, the glaring inconsistency – that Revelli Tire, which has been in existence for 56 years is being evicted in order to make room for a Sears Tire store. This is the politics of pull. Said City development director Dan Vederpriem, “[W]e offered far and away more than what the land value was.” . . . Well, er. No, not actually. Oakland offered more than what it thinks the land value was. If I offered you $100 for your Honus Wagner baseball card, using as justification, “I think $100 is more than a good deal, who would want that old piece of cardboard anyway?”

The land value, is however, an agreed upon price of sale, or the price at which the current titleholder would be willing to sell. SEV is useful as a yardstick, but it cannot objectively measure value. The bottom line is that if the buyer and seller cannot agree on a price, then its apparent that the buyer is not offering enough, or in other words, the land is more valuable to the current owner than it is to the developer.

Apparently Romulus, MI, tried to pull the same sort of crap here in Michigan, and the landowner took it to the state supreme court. And won, reversing twenty years of legal precedent. At least we got it right.

Consider: “The economy now is global. A company says, ‘Do I locate in China or do I locate in the Midwest? What are the advantages that I have?’ One of the biggest advantages is being able to assemble land,” [Wayne County executive Bob] Fiacano said.” Yes, it is certainly an advantage to have at your disposal, a State that is willing to appropriate land held in legal title by its citizens, and dole it out to the highest campaign contributor, crony corporation that paints the prettiest, rosiest picture of the future with a PowerPoint presentation. This ruling certainly “undercuts Michigan’s opportunity to lure businesses” through bribery and cronyism.

If a business wants to relocate to a country, where the government bullies landowners into providing it with property, [China] then so be it. Let’s not be part of the problem.

Using the State’s power of Eminent Domain is preferable to corportions under certain circumstances. It is a defensible position to take, because you are acting in concert with the law. It permits you to parade under a banner of altruism, expressing concern for the “public good,” or “social welfare” or “the working poor” or any number of other cliches.

In these instances, the state is determining that a corporation’s business proposal is sufficient to trump an otherwise unclouded legal title. This is the sort of injustice that will eventually be blamed on Capitalism – attributed to the evil corporations. Make no mistake, though, that this sort of action is most definitely a step in the direction of socialism. The state’s obligation is to protect its citizens (both individual and corporate,) and to defend their respective rights to life, liberty and property.

no third solution

Blogging about liberty, anarchy, economics and politics