Urban Renewal - Opportunity for Land Piracy? J.C. Sparks

URBAN RENEWAL OPPORTUNITY FOR LAND PIRACY? tg Jo~n e. Spartj ~ MANY INSPIRING stories of American heroism came out of our war to win freedom from England. Courage was the badge of the times. The thrilling account of the Boston "Indians' " famed Tea Party that cold December night in 1773 in defiance of the British government is but one of numerous accounts of the bravery of free men fighting against overwhelming odds. For any colonist to declare himself on the side of the American Revolution ists was truly to "cross the Rubicon," for ahead seemed certain defeat and subsequent death or imprisonment for daring to stand in defiance. Yet, enough men recog nized that the authoritarian acts of the mother country were ruthlessly trampling the liberties they had come to enjoy and expect in their new land. They resisted any power that would attempt to remove the rights they be lieved were endowed upon them by God.

It is expected that a few men will always be alert to the danger of government oppression and will discern Mr. Sparks is a business· executive and past president of the Can ton, Ohio, Chamber of Commerce. His earlier article J "The Urban Renewal Fallacy," appears in Essays on Liberty, Volume IX, p. 43. 51 52 JOHN C. SPARKS its characteristics no matter how cleverly disguised. Un fortunately, there also will be a few who, while compre hending the issue, will choose to seek improper power in the government or in special positions of influence involving privilege. In between are the majority, many of whom are unaware of any issue or whose other inter ests seem more important than the preservation of in dividual liberty or who fear to differ from majority opinion. Throughout the colonies-north or south, seacoast or inland mountains-men who loved liberty and hated op pression sprang up to fight for their principles. The min utemen of the Massachusetts countryside had personally felt the burden of British taxes, the outrage of despotic rule in their colony, and the arrogance of British officials on the streets of Boston. These brave men-among them farmers, merchants, shopkeepers, workers in all trades and occupations-arose to defend their liberties when they were threatened at home~ in Boston. They did not wait for other colonies or other lands to extend advice from some distant point. They acted themselves!

In the Carolinas a nondescript, half-starved band of freedom-loving men under the leadership of the "swamp fox," Francis Marion, made the war miserable for the British cavalry commander, Tarleton. They felt oppres sion and reacted to itl Similar heroic events occurred in Virginia, in Pennsylvania, and so on througho~t the em bryonic nation. What does this review of the American Revolution have to do with government urban renewal? It simply URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 53 points out a rather common human reaction to oppres sion: when freedom is denied, those losing their freedom and those near enough to the victims to feel the pain and to join in outraged indignation, will be the ones most likely to revolt against the tormentors. 1 Government in terference is more upsetting when encountered in one's home community than when examined theoretically with regard to a situation in another part of the country or world.

If unlimited government is an un-American concept, then it should be especially provoking when big govern ment power pushes around one's neighbor or oneself. Excessive taxation should be particularly galling when new spending programs originate in one's own city. Loose spending should be most painful when experi enced at firsthand in all of its wastefulness. Any Objections? We should expect outcries throughout the land against urban renewal, especially from such community thought leaders as those who so eloquently defended against the recent attempt to socialize the medical profession, or those who fight a continuing battle against the spread of gov ernment-owned electric power, or those whose public speeches purport to champion the individual's right to 1 An eminent political scientist observes that no area in the world today has more appreciation of freedom from oppression than the geographic area adjacent and running parallel to the "iron curtain" boundaries lying next to Russia and her con quered nations.

54 JOHN C. SPARKS earn, save, and spend his own income without interfer ence from big government, or those who actively support the right of individual choice against enforced member ship in labor organizations. We should expect angry resistance! But where is it? Why does not urban renewal cause righteous resistance in every city and community in the nation into which its immoral tentacles have spread? Where is the opposi tion? Where are the advocates of private ownership? Where are the defenders of individual rights? Only an occasional dissenting voice is heard. This is surprising because it is not difficult to discern that government intervention has a near-perfect record in producing undesirable results-sometimes humorous, sometimes tragic-but always enforcing the unnatural so that the consequences spell reverse progress. When an abundance of a farm product threatens to trigger a price decline, the nature of government intervention inevitably is a price support program, thereby encouraging farmers to produce more of the same. The original problem, abundance, is aggravated by increased abundance. Rent control during and following World War II was a form of government intervention intended to assist more per sons to rent property at reasonable prices. Instead, people occupied more space than they needed because it was comparatively cheap, and potential landlords did not make additional space available because it was unprofit able to do so at the rental prices allowed. Again, the result was quite contrary to the intention.

These reverse effects are not freaks; they can be anticiURBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 55 pated nearly every time. While a few industrial and business leaders may not fully understand the fallacy of government interference in their economic decisions, most are well enough acquainted with its nature to op pose such government actions vehemently. Must one be lieve that a businessman, sophisticated enough to under stand the nonsense in minimum wage laws and unem ployment taxes, is so dull as to fail to comprehend the open invitation to chicanery in the government urban renewal scheme? Perhaps the mixture of civic dreams and civic pride truly blinds the sometimes champion of freedom to the immorality of the position he supports when he partici pates directly-or indirectly through his silence-in bring ing federal urban renewal money, control, injustice, and oppression to his community. Those who are generous may allow this possible excuse for the illogical and im moral action taken.

No generosity is warranted, however, toward one who recognizes the immoral premise but nevertheless parrots the worn-out cliche, "We're paying for it, so we might as well get our share." It is as though a man believes him self to be a fighter and flexes his muscles in public as he proclaims loudly how well he will do when he meets the enemy. Finally comes the day and place of the meeting, whereupon he joins the enemy. When government inter vention threatens his own community, this vociferous would-be defender of freedom capitulates. Unfortunately, the people who sincerely want to strengthen their community are drawn almost inevitably 56 JOHN C. SPARKS to programs that actually undermine and kill the com munity instead. Redesigns of allegedly fringe business districts are typical. Small merchants, providing unique services or products, are uprooted. Many cannot survive financially during the interim, losing their customers while waiting in limbo. They even may be excluded from the planned new business district because the plan ner doubts their usefulness in his neat uncluttered scheme. Genuine diversity is thus lost; but business dis tricts require diversity to live. Cities grow only as busi nesses thrive, not as they expire. Furthermore, in order to raise the local matching funds necessary to comply with the provisions of federal grants, local taxes are in creased. This compounds the error, because increased taxation not only fails to attract new business and indus try but tends to drive established business away.

,Granted that some are blinded by their civic objectives. Granted that others know better, but rationalize a desire to see their community get its share. Do these two weak nesses effectively eliminate almost all potential leaders of resistance against urban renewal? Recall that there are men in every community who speak out against a variety of government interferences agains t socialized medicine, price and wage controls, government operation in fields pre-empted from pri vate ownership, and other encroachment upon the rights of individuals. Can it be that government inter ference and oppression, involving funds forcibly taken from persons everywhere, are proper and moral and right just in this one area-urban renewal?

URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 57 Hardly. It does not check with logic. So, let's see what other reasons might be so compelling and so convincing as to remove practically all influential opposition. Years ago Lord Acton observed that power corrupts and complete power corrupts completely. If power is present to a great degree in any government situation, then one can depend on it that corruption follows. rrpublic Use" Redefined Laws, once designed to protect the individual against seizure of his property for other than strictly limited public use, now have been diluted to the point where public use is almost anything government planners de cide it shall be. Constitutional checks and balances have evaporated, with the courts of the land affording virtu ally no protection for individuals against domination by predators in the legislative bodies of states and munici palities.

Until 1954, the Constitution of the United States pro hibited government seizure of private property except for public use, and then, of course, only with just com pensation. For years public use was limited to such things as public highways, public schools, and government buildings. In certain cases this right of eminent domain was also extended to private owners classed as public utilities, thus allowing power and gas companies to ac quire the necessary rights of way to run their lines. Rail roads as public carriers were also granted this power in limited circumstances. Consequently, the right of 58 JOHN C. SPARKS eminent domain was used sparingly and only under con ditions well-known to everyone. Slum Clearance However, in 1954, the Supreme Court changed the law of the land so that the elimination of a slum was in terpreted to be a public use, enabling government agen cies to seize private property and resell to new private owners if, in the process, a slum' is wiped out.Further more, the particular piece of property seized need not be "blighted" but may be taken simply because it is part of a total project or program that eliminates a slum.

This interpretation enables the professional government planner to remake whole sections of cities; in fact, no property within a city is outside his potential power. If this were not sufficient power, more recent rulings by state courts have extended this interpretation to mean that any property that may become a slum in the future can now be seized.2 There is little doubt that great power has been con ferred upon municipalities to seize property in accordance 2 Judge Van Voorhis in his dissenting opinion in Canata v. City of New York, indicated that governmental agencies were not satisfied with the power of law to eliminate slums, but had now provided for the elimination of potential slums, meaning any thing city planners think does not conform to their designs. The judge then pointed out that had public theorists had full sway in the early nineteenth century in America, the country would have invested its substance in the construction of canals "as any intelligent theorist would have seen was the effective way to pro mote economic development in the United States. Railroads were just around the corner, but their advent was obvious to nobody."

URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 59 with their plans to eliminate slums or possible future slums. This is a blank check. Yes, the power is there, endorsed by the courts of the land, opening the door wide to those who would plun der in the name of planning fur the public good. Have local communities accepted the opportunity to use this power? Eugene Segal, writing in Thee leveland Plain Dealer, December 30, 1961, said, ".... The Board of Control .... is composed of members of [the mayor's] cabinet, in cluding [the] Urban Renewal Director whose opinion can be expected to dominate in matters relating to urban renewal. So it is likely that while the planning commis sion and its fine arts advisory committee were obliged to go through the motions, it will be [the Urban Renewal Director] who in effect will make the final choice." The news item related to three competitive plans submitted for development of a certain piece of land in downtown Cleveland. The Fine Arts Advisory Committee to the City Planning Commission was reputedly in overwhelm ing concurrence as to the superiority of a plan submitted by a Detroit builder. In selecting one of the other plans, the Board of Control explained that the plan of the selectee "was economically more feasible." It was further reported on January 18, 1962, that the attorney for the Detroit developer indicated he would probably bring suit because his client's plan and bid were turned down by the city "although his plan was judged superior ....

and he bid $100,000 more for the apartment site than other bidders."

60 JOHN C. SPARKS Yes, great amounts of power have been placed in the hands of city politicians and professional planners. And power corrupts. Complete power corrupts completely. Webster says that to corrupt is to change from a state of uprightness to a bad state, or to debase. Corrupt means to change from truth to untruth and from honesty to dishonesty. Temptations to Dishonesty What are the temptations to dishonesty by those in volved in urban renewal? There is little doubt that the most important is the value of the private property to be seized and resold to new owners. Private property any where has value and especially in populous centers. The value of certain private property can skyrocket if one seeking his own benefit has a hand in the compulsory rearrangement of all property in that area. A plan backed by power may cause a rearrangement of land use so that a new owner, favored by the planners, gains advantages of location and use formerly developed and held by others. The "availability" of taxpayer funds in the fed eral treasury with which to accomplish the ill deed is a minor temptation in comparison to the attraction pro vided by such manipulation and transfer of downtown property values.

Imagine a beautiful grassy baseball field, fully equipped, set down in a neighborhood of American boys in the summertime. Would a baseball game ensue? It would. All the ingredients are there.

URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 61 So are all the ingredients present in the urban renewal scheme-the temptations to tyranny and corruption. The power is indescribably great. For the squeamish, who would not act immorally when the act is illegal, moral principles have been negated through law. Huge prop erty values stand defenseless against seizure. Federal money and personnel cleverly encourage adoption of their programs. The worn cliche, "get our share," be comes the password of the day, but not really to achieve civic advancement-this is not now the subject of our concern. The cliche is but a thin disguise for the fact that one has discarded his purported principles and has seized a once-in-a-lifetime opportunity to plunder fellow citizens and to gain advantages by pushing around his neighbors, all done quite legally and in the name of civic duty. These are the ingredients. Will there be a ball game?

You can bet your boots! Potential l"l"Deals" There are so many communities involved in federal urban renewal programs that it is next to impossible to uncover all of the deals that doubtless are being chalked up. If someho,v they could be tallied, the well-known scandals of the past involving power government and immoral opportunists would likely be dwarfed by those "ringing the cash register" today in the urban renewal "club" of privileged members. It is a kind of local com munity do-it-yourself bit of tyranny and scandal.

62 JOHN C. SPARKS While they may be difficult to uncover, it is not difficult to describe various deals and examples of oppressive acts that can be expected. The purpose of describing these is to alert the reader to take more than one look at the happenings in his own city. The community newspaper in the past was the recog nized crusader against oppressive acts, no matter who committed them-gangs, racketeers, businessmen-anyone or more of whom may have illegally combined with im moral government regimes. Concerning the urban re newal fallacy, where is the newspaper crusade? Could silence be golden, literally speaking? The physical real estate of the newspaper publishing company in your city, quite by coincidence, may be in line for some secondary or even primary benefits as a result of the planner's rearrangement of the city. A look at the master plan in any municipality will likely re veal some interesting arrangement that takes special cog nizance of the leading newspaper's physical property. A prerequisite to the planner's success is the support of the newspaper, and its wishes are more likely to be consid ered favorably. Furthermore, a newspaper's largest in come is from advertising. Downtown merchants are usu ally heavy advertisers. Urban renewal programs are often centered around the objective to revive downtown.

Another likely area of legal immorality allowing ma nipulation will be in the local interpretation of the mean ing of a slum or a potential slum. This is not a definite concept, and one can expect the determination of what constitutes a blighted area will be quite flexible, to favor URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 63 any objective in the minds of the members of the "club" operated by the municipality's political head and his planner. Or more clearly stated, the chances are good that nonslum property and nonpotential slum property will be condemned and labeled substandard. As a matter of fact, property beginning to rise in value due to changing economic conditions may be a special plum ripe for picking. For instance, the Erieview project in Cleveland, Ohio, covers an area that had seen the beginning of increased market values in recent years.3 Several large modern commercial buildings had been erected in the mid-fifties.

Cleveland's new seaport and a new lake-front expressway have also contributed to these growing values, in fact, may have been the chief reasons lending attractiveness to the area for more than the original property owners. When properties are sold to new private owners at one fifth to one-fourth the price paid by the municipality, this is bound to attract anyone willing to take advantage of immoral laws and supreme court decisions granting the privilege of legalized land piracy. It seems reasonable to expect that substantial owners 3 The Cleveland Press, March 25, 1960, in a news item written by Bob Siegel: "Nationally known economist-investor Elliott Janeway today predicted Cleveland is on the threshold of a new period of downtown growth . . . . because of its position on the Seaway, its diversified industry, and its big supply of executive and labor talent .... " Carrying out his prediction, janeway's firm constructed on the land referred to a new building for a large national office equipment company. It was occupied in 1960. One year later the City of Cleveland acquired the building for $1,500,000 and will tear it down in 1964 to use that land according to the urban renewal plan.

64 JOHN C. SPARKS of large areas of condemned property will strenuously object, at least until included in the deal through some satisfactory compensation. Perhaps these former owners will be allowed to repurchase the leveled land from the city without the formality of an open bid. Or perhaps the plan will be altered to enhance other property of these former owners, such as a new arrangement of property use that will funnel shoppers advantageously to either the existing store or the new store of the former owners. Look at gerrymandering of an urban renewal district as a clue to manipulation to favor some in positions of influence to the disadvantage of others. Is a piece of property omitted from the area by an unusual deviation of the boundary lines? Or, is a piece of desirable real estate included unnaturally by a deviation in boundaries? In either case the decision may have been reached by sur reptitious under-the-table deals, sugar-coated with pub lic-relation pledges avowing the decision to be best for the community.

Another advantage to manipulators is to divulge the plans piecemeal over a long period of time. This step by-step revelation weakens those about-to-be-displaced property owners who would enlist the aid of their coun terparts in other "planned" areas had the master plan been made public knowledge. Any chance to unite the opposition for defense against push-around tactics be comes slim as a consequence. Such secretive plans may be good tactics for the planner's motives but morality or good business for the community may be another matter. In New Haven, Connecticut, "the hush-hush plans laid URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 65 at City Hall called for relocating displaced businesses, but the planners were vague on the crucial details of when or where. Many of the merchants were middle-aged; how could they begin again? In desperation, they sued the city. An embattled jeweler, ordered to vacate a new building, carried his plea all the way to the State Su preme Court. In. the end, the planners prevailed and the suits were lost or abandoned."4 One must ask why "rail roading" tactics are used. The answer given undoubtedly will be that such methods are needed to prevent an un cooperative owner from blocking the city's progress. The real answer may be more aptly stated as a strategy to catch probable opposition off guard.

Open invitations to bid to develop pieces of land leveled by urban renewal would seem to protect against favoritism, but not with this power-laden scheme. It is frequently stipulated that bids must include detailed site development suggestions or blueprints for the "bet terment of the community." With this intangible meas ure, one can expect any kind of shenanigan. 5 Is the leveled land sold to the highest bidder? If it is not, then one may well wonder whether the successful bidder's •Richard J. Whalen. uPlanners, Politicians, and People." Hu man Events, June 9, 1962. II James L. Wick. Human Events, June 30, 1962: UUrban re newal agencies are exempt from that antiquated requirement [that sales of government property be made to the highest bid der]. They may arbitrarily set the price at which urban renewal land shall be sold; offers of higher sums are disregarded as im material, irrelevant, and contemptuous of the dignity of political planning. The winning bidder is chosen by criteria which may be almost anything the planners conclude to be 'in the national interest.' "

66 JOHN C. SPARKS blueprint for development was truly superior or, instead, may have been the means to convey a reward for "co operation" or in payment for "influence." Sometimes the price is fixed in advance and the "bid ding" is then confined to the judgment of which plan is considered best. In one large city, a company sold a piece of property to the urban renewal agency for several million dollars. Later, at a fixed price of 22 per cent of the original price, the same company was the successful "bidder" to buy back the property among nearly twenty firms submitting architectural designs. A neat profit ap pears to have been made on the deal. Anticipating that the coincidence might be difficult to believe, "the urban renewal agency declared the judges had no knowledge ... who had entered the winning design."6 Power and Corruption Since increasing emphasis in federal urban renewal is shifting toward renovation of the central core, it might be fruitful to examine decisions regarding the con trol by local government agencies of the use of land out side the renewal area. Many urban problems are felt to stem from a migration of people and businesses and their activities from the city to the suburbs. It may be ex pected, therefore, that cities will attempt to use measures that will penalize the "outsiders" by increasing charges for municipal services beyond the corporation limits, re fusing to extend water and sewer lines to proposed new 6 Human Events, June 30, 1962.

URBAN RENEWAL-OPPORTUNITY FOR LAND PIRACY? 67 suburban shopping centers, and the like. The growing use of a city income tax that taxes nonresidents who only work in the city at the same rate as those who reside in the city is a related phenomenon. Within a city, but out side of downtown, the same kind of land-use restriction may be applied to would-be builders of private projects that may compete with the urban renewal downtown. This is not theory, but fact, as reported in The Cleveland Plain Dealer article of January 19, 1961, by Eugene Segal: "The Federal Housing Administration Office here has stopped the proposed construction of an eight million dollar downtown apartment building [outside ErieviewJ to discourage competition with dwellings that might be built in the Erieview urban renewal area." Thus is power wielded; thus is corruption invited. Corruption is an unfailing companion of great arbitrary power. The ingredients are present. The ball game is be ing played. A new kind of tyranny is in the saddle of municipal government, aided and abetted by Washington bureaucrats, and by local civic leaders and stalwart busi nessmen whose consciences have been drowned out by the one-time chance to get "theirs."

In the Long Run Justice may reign in the end regardless. The loot seized by land piracy may glitter less once gained, if the observation of Jane Jacobs is pertinent and accurate. In her excellent new book, The Death and Life of Great An'lericanGities (Random House, 1961) she reports 68 JOHN C. SPARKS urban renewal and city planning to date has brought dull, unexciting, and unprofitable results. No advocate of freedom can in good conscience advo cate legal theft and legal manipulation of the private property of others for his own gain. Justification of im morality may be attempted by alluding to the sheer weight of the numbers joining in the government urban renewal scheme. But moral principle is not changed by numbers favoring its banishment. Where is today's counterpart of the 1776 American who would not countenance the practice of tyranny in his community? Regrettably, he is not in his accustomed role. Perhaps he can be found in Washington with his hand out, or behind the scenes in his home town enter ing into a legal conspiracy to rearrange the private prop erty of others by coercive means-in the name of civic progress! Or he may be fearful to speak out against what he sees.

Let us hope that free men will not be blind much longer to the immorality of coercive urban planning, and will curb the government power that makes it possible. Freedom needs all its advocates.