Is Judicial Review Necessary to Protect Private Property Rights? Term Paper

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Judicial Review: A Review of "Political Institutions, Judicial Review, and Private Property: A Comparative Institutional Analysis"

In "Political Institutions, Judicial Review, and Private Property: A Comparative Institutional Analysis," Daniel Cole discusses the role that judicial review has played in the protection of private property rights. He begins by stating the assumption that judicial review has played a critical role in the maintenance of private property rights and then questioning that assumption. He begins by reviewing the assertions of some scholars that private property owners do not require judicial review to protect their property interests because they are capable of doing so through the political process without the intervention of the courts. In fact, these scholars suggest that the courts are not well-situated to deal with compensating people who have been victimized by such unjust takings, suggesting that even a flawed regulatory system is better-situated at handling these problems than the court system is. To some extent, Cole agrees with these scholars and attempts to support his position that democratic political institutions will protect property rights, even though courts have proven incapable of doing so.

Cole breaks his article into several different subsections. In Section I, Cole examines the tension between democracy and property rights. He begins with the framers and the concerns that Madison had about protecting individual property rights in a society that was democratic, which, in many ways, challenges some of the notions of property rights. There has always been a tension between private property ownership and democracy, which Cole believes was exacerbated with the rise of the welfare state, which was essentially a series of takings of private property for public use. Holmes even introduced the idea of a regulatory taking, suggesting that if a government regulation impacts the value of private property sufficiently, it should be considered a taking even if the property has not been removed from the property owner. Cole examines Epstein's approach to the concept of takings, and believes that Epstein's characterization of his position as Lockean is erroneous.

In Section II, Cole introduces the challenges to judicial review posed by modern scholars Fischel and Komesar. He focuses specifically on judicial review of the governmental powers of eminent domain and its general police power. Fischel espouses a normative theory of regulatory taking. Fischel believes that because property owners are not an oppressed minority, they are capable of engaging in self-protective behaviors through the legislative process (Cole, p.1). Furthermore, Fischel believes this to be true even in governments that he considers welfare-states, where common interests like health and safety impact the ways that individuals can use their own land, which can amount to a regulatory taking (Cole, p.13).

Cole points out that Komesar does not share Fischel's belief that the legislative process is sufficient to protect private property rights. However, he believes that he flaws inherent in the political and legislative process as it concerns the protection of private property rights are also inherent in the legal system, making judicial review of private property a flawed system. Furthermore, "Komesar argues that this is a fatal flaw in Epstein's theory of takings because just compensation is neither an efficient nor an equitable remedy for problems of minoritarian bias in legislative decision-making" (Cole, p.10).

Cole continues, in Section III, to examine this judicial review by examining whether there is support for Fischel's normative theory of regulatory takings. He believes that Komesar's position that the government is both the best friend and the greatest threat to private property ownership does make sense. However, he does not reject the notion that the government has reasons to support and encourage private property ownership. Therefore, he endorses, at least in part, Fischel's normative theory of regulatory takings. Cole provides both theoretical and empirical support for the theory. The theoretical support derives from theories that suggest that the government has to protect property rights in order to increase production, have support for the government, and collect taxes.

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Cole provides seven bases for theoretical support: governments require support to survive; government support depends upon institutional structure; property rights are part of a state's institutional structure; property rights are costly to design and enforce; governments can be expected to design and enforce property rights because that increases support for the government; and property rights can either maximize social welfare or social justice (Cole, pp.18-19). Looking at the international arena, one finds support for these seven tenets. For example, "regimes that did not sufficiently protect private property, including the Third Reich and the Soviet Union, survived less than a generation and less than a century, respectively. Nominally "Communist" China appears to have learned this lesson, as it has moved increasingly in recent years toward a market economy based on private property" (Cole, p.19).

The empirical support is not from the U.S., but is based on an examination of English law, which has never included a doctrine of judicial review in its takings process. Furthermore, while takings are linked to compensation, regulations are not, given that regulations are the result of parliamentary action and are viewed as infallible in a way that legislation in the United States is not (Cole, p.24). Cole provides empirical evidence by pointing to the fact that "the United Kingdom provides several hundred years' worth of historical evidence in support of the theory that political institutions substantially protect private property rights, even in the absence of constitutional requirements of just compensation and judicial review of legislation" (Cole, p.21). He gives lengthy examples, beginning in the fifteenth century, of parliamentary laws allowing for the taking or regulation of land without compensation, and then the development of a trend towards compensation for the taking of land. However, while he cites the laws that suggest such compensation, Cole fails to provide direct empirical evidence, such as a comprehensive list of historical takings that the reader could compare to property values in order to make an independent determination of whether those takings were compensated at market value rates in a the manner one would anticipate if individual property rights were being protected. However, by stating that Blackstone suggested that the power of eminent domain was really a power for forced, compensated sales, when it really went beyond that power, Cole demonstrates how rare it was for the government to engage in a taking without providing compensation (Cole, p.30). For example, when the British colonies abolished slavery, they provided compensation to slaveholders for the taking of their property (Cole, p.30).

In Section IV, Cole undertakes a direct comparison between the UK and U.S. legal and political systems and how those systems deal with the taking of private property by the government. He discusses the UK's 1947 Town and Country Planning Act and also discusses takings within the context of the relatively small UK, where land space is far more limited than in the U.S. People simply do not have the right to develop their land without receiving permission and the refusal to grant permission is not considered a taking or the basis for compensation. There is an underlying belief that even private property has some type of public character. Even given these fundamental differences, he finds that the UK provides the same protections for private property at the U.S. without having to involve the judiciary, which he states is support for the idea that judicial review is unnecessary to protect private property interests.

In Section V, Cole garners more support for the idea that property rights can be protected without judicial review. First, he looks at the fact that legislation has always attempted to protect private property interests. As an example of such legislation, he cites Measure 37 in Oregon, which turns all land use regulations that restrict the use of real private property in a way that impacts its fair market value as a taking….....

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