Washington, D.C., June 23, 2005—The U.S. Supreme Court today dealt a blow to property rights in a split decision that will hurt homeowners and small business owners across the country.

“The Supreme Court has said that local governments can seize private land if government and business interests think they know best how the land should be used,” said Hans Bader, legal counsel for the Competitive Enterprise Institute.

“The Court’s decision contradicts the language and intent of the Fifth Amendment,” said Bader.  “The Constitution says you can’t take private property except for ‘public use.’

But when government seizes land and hands it over to business interests to jack up tax revenue, the public isn’t ‘using’ the land.

“Government can always claim a ‘public purpose,’ but that’s not the same as ‘public use,’” said Bader.

“This decision represents a frightening continuation of the onslaught against the basic underpinning of America's free society and our individual liberty,” added R.J. Smith, CEI adjunct scholar.

“Property rights are the basic guarantee of freedom,” said Smith. “That is why Thomas Jefferson and the other Founders wanted the widest possible distribution and ownership of land by private citizens as possible.”

The Court ruled 5-4 in Kelo v. New London that the justices should “decline to second-guess the city's considered judgments about the efficacy of its development plan.''  Justice Sandra Day O’Conner wrote a strong dissent, saying that: “Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random.  The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms.”

CEI analysts available for interviews:

Hans Bader, CEI Legal Counsel

R.J. Smith, Senior Scholar