Regulatory Taking on an Unprecedented Scale

The Fifth Amendment’s “takings clause” stipulates that “private property [shall not] be taken for public use, without just compensation.”  Many state constitutions provide additional limitations on eminent domain, such as California’s, which stipulates that such compensation must be “ascertained by a jury unless waived.”

The courts recognize that takings extend beyond the physical seizure of property.  Takings also occur when government regulations restrict the use or alter the value of property.  Yet such regulatory takings have become increasingly common as federal agencies turn a blind eye to the Constitution.

Now the Obama administration has announced a diversity policy that constitutes regulatory taking on an unprecedented scale.  With HUD’s Affirmatively Furthering Fair Housing rule, the administration plans to fund the construction of low-income housing within middle-class neighborhoods across the country.  This placement of subsidized housing projects within affluent neighborhoods constitutes a taking, because the property values and usefulness of existing homes will be reduced and curtailed.

The damage will include but not be limited to financial loss.  HUD’s rule change undermines the fundamental right of homeowners to live in a safe, quiet, well-maintained neighborhood.

It is hard to underestimate the insidiousness of HUD’s unconstitutional expansion of the Fair Housing Act of 1968.  The new initiative employs a taxpayer’s own money to fund the reduction of his property values and to strip him of his rights as a homeowner.  And it does so in order to provide subsidized or no-cost housing to welfare clients of the state who in many cases have never worked. 

Once HUD’s low-income housing has been built, suburban families will find their crime rates increasing – not just the number of burglaries and thefts, but drug sales, gang activity, and murders as well.  Every survey of crime statistics has revealed the same fact: criminal activity, and violent activity in particular, occurs at a much higher rates in proximity to public housing.

In one major study of “Drugs and Crime in Public Housing,” the researchers concluded that “drug and violent offenses are severe problems in housing developments.”  In “American Murder Mystery,” Hannah Rosin reported the extremely close relationship between subsidized (Section 8) housing and violent crime rates in Memphis, Tennessee – a finding that has crucial importance in relation to HUD’s proposed rule change.  There is overwhelming evidence to suggest that the locating of public housing in middle-class neighborhoods will raise the rates of violent crime in those neighborhoods.

One irony of the fair housing rule is that it will negatively impact the poor as much as the middle-class.  Poor families that have worked their way out of crime-ridden sections of cities like Baltimore and Detroit and into safe suburban neighborhoods will find that their past has followed them to the suburbs.

Even those who “benefit” directly from the low-income housing are not being helped.  According to a HUD spokeswoman, “[t]he proposed policy seeks to break down barriers to access to opportunity in communities supported by HUD funds.”  That convoluted gobbledygook conceals the real intent of the fair housing policy, which has nothing to do with opportunity – or, for that matter, with “fair housing.”  Like all government poverty programs, the Affirmatively Furthering Fair Housing rule fosters continued dependence on the state – just the sort of permanent dependence liberals have always espoused.

If it had been more forthright, HUD would have admitted that its proposed policy seeks to employ taxpayer money to subsidize the building of public housing units in proximity to the homes of middle-class Americans so that the poor, who have chosen not to educate themselves and not to work, can continue to fail.  And to do so “in communities supported by HUD funds,” which is to say, everywhere.

Whatever the administration’s motives, and the perpetuation of a dependent welfare class seems to be one of them, the Affirmatively Furthering Fair Housing proposal is the most pernicious piece of federal rule-making since school busing.  With this rule change, the heavy hand of government is reaching right into the home, placing families at risk, and denying them the right to live where and how they wish.

 This astounding expansion of government power is being justified on the basis of the Fair Housing Act of 1968.  That law, however, was never intended to subsidize housing for the poor, but merely to outlaw discrimination on the basis of race, creed, or national origin.  It is one thing to deny an individual the right to purchase a home on the basis of his identity; it is quite another for government to subsidize middle-class housing for him on the bogus theory that he lacks opportunity because of his identity.

In fact, two thirds of the Forbes 400 list of billionaires consist of self-made individuals.  Not everyone who comes from the projects is going to become a billionaire, but everyone in America has the opportunity complete high school, find a job, and make a decent living.  And once people do so, they can move to a safe, clean suburban neighborhood without HUD’s assistance.  HUD’s expansion of “fair housing” ensures that America’s poor will be less likely to make it on their own, and so the cycle of poverty will be perpetuated.  

HUD’s rule change is not only an unconstitutional regulatory taking that will affect property values wherever it is put into effect.  It is also an assault on the American Dream.  The idea of living in a safe, quiet, orderly neighborhood among others who share one’s values of hard work and success has always been part of that dream.  From now on, unless HUD’s Affirmatively Furthering Fair Housing rule is blocked by Congress, that part of the American Dream will be just a memory.

All Americans, but especially those who aspire to a better life in safe, middle-class neighborhoods, should be appalled by the Obama administration’s latest assault on liberty.

Jeffrey Folks is the author of many books and articles on American culture, including Heartland of the Imagination (2011).