Local Government, "Blight", and Legal Plunder

In The Law, Frédéric Bastiat writes on the dangerous idea of "legal plunder", saying...

"Under the pretense of organization, regulation, protection, or encouragement, the law takes property from one person and gives it to another; the law takes the wealth of all and gives it to a few — whether farmers, manufacturers, ship owners, artists, or comedians."

This definition of "legal plunder", taking property from one to give to another, encompasses all sorts of government activity. At a local level, it's easy for a municipal government to wave its hands and claim that policies of legal plunder - where property and wealth is taken from one group of individuals and given to another - is really in the common interest of all. 

One example is the idea of urban "blight". Originally a biological term referring to dying plants, the term has been appropriated by governments to mean some sort of decrepit or decaying building. To combat this blight, local governments seek to demolish or other renovate these buildings (often with taxpayer funds). Justifications for this include: higher property values (and thus, higher tax revenues for the municipality), public safety concerns, and economic development. 

Pictured: Blight (?)

To use a local example, the city of Hillsdale recently voted to demolish three structures deemed "blighted". One such structure, the remains of a burned-down house, was on the property of a local woman. She protested the move heavily, but the city council voted to demolish it all the same.

The councilors had a host of justifications for their vote, including the public safety risk that a child might fall into a basement and be injured. Mind you, this has yet to happen, but we must be vigilant all the same!

The cash-strapped city government may have been partially motivated by the promise of a $24,275 grant from the state of Michigan, meant to cover the costs of demolishing blighted property. Who benefits in this scenario? Certainly not the taxpayers as a whole. Taxpayers in the city of Hillsdale pay state taxes, which the state then sends back to the city of Hillsdale to tear down houses. The rise in the value of their property from less nearby blight is likely to be negligible, and probably not even cover the taxes they had to pay for the pleasure. 

Some property owners may benefit, if they were planning on demolishing the property regardless (as is often the case). Only now, the taxpayers are footing the bill. The city is happy if the move generates slightly more tax revenue, years down the line, due to marginal increases in property value.

Would the city of Hillsdale be a little bit nicer if these plans go through? Probably. Is it worth perpetuating a system of legal plunder that transfers wealth from many taxpayers to a few beneficiaries? Probably not.