Land-Grabs Put Entrepreneurs, Poor in Dire Spot

Land-Grabs Put Entrepreneurs, Poor in Dire Spot

New Report Slams Government Abuse of Power
March 03, 2010

Washington, D.C., March 3, 2010 – When government seizes land from private owners to serve a purpose preferred by bureaucrats and big business, it directly harms potential entrepreneurs. That’s the finding of a new report from the Competitive Enterprise Institute, This Land Ain’t your Land; this Land Is my Land: A Primer on Eminent Domain, Redevelopment, and Entrepreneurship.

“The consequences of eminent domain abuse are extremely dire for the low-income potential entrepreneur,” says report author, CEI Policy Analyst Marc Scribner. 

“Local officials lack the knowledge and expertise to effectively promote private development,” says Scribner, “so their political missteps can keep their localities in poverty by undermining entrepreneurship, and forgo the wealth it would have created.”

“Moreover, takings tend to target lower-income areas,” notes Scribner, “which in turn decrease profitable opportunities for low-income entrepreneurs disproportionately.”

Eminent domain has been a political hot button issue since 2005, when the U.S. Supreme Court upheld the City of New London, Connecticut’s decision to condemn several parcels of residential property using government’s powers of eminent domain.  City officials wanted a comprehensive redevelopment plan to support a new research facility of pharmaceutical giant Pfizer. The research facility has since been shuttered, and the increased tax revenue and revitalized river district promoted by city officials didn’t materialize.  Now, the land is home to a large vacant lot. 

The report examines other such scenarios that have played out nationwide, and calls for government to stop abusing eminent domain power and allow market incentives that promote economic development.

> View the CEI OnPoint, This Land Ain’t your Land; this Land Is my Land: A Primer on Eminent Domain, Redevelopment, and Entrepreneurship by Marc Scribner