The Fifth Amendment to the Constitution doesn’t just protect you from being forced to give self-incriminating testimony; tacked onto the end is what’s known as the "takings clause": "…nor shall private property be taken for public use, without just compensation." There’s a rather complex methodology for deciding if it applies to a given case, but at its most simple (say Ohio seizing property through eminent domain to build a highway), it requires property owners to be compensated for the state’s taking of their property. Recently, in the sexily-named Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency, the Supreme Court ruled that a lengthy delay, one of thirty-two months, on development at Lake Tahoe did not constitute a taking under the Constitution. Steven Landsburg’s disingenuous Slate article on the Tahoe ruling managed to not mention the word "taking" at all, instead riffing on a distortion of Justice Stevens’ ruling and claiming that the Supreme Court might as well, by gum, have ruled government illegal. The takings clause has been one of many used the Wise Use movement (groups like the National Wetlands Coalition) to oppose environmental regulation. The idea is that any limits on the rights of property owners and specifically the rights to develop on legally protected wetlands are a taking and thus something that the government must compensate landowners in return for. The movement has gained traction in the in the last twenty years, noteably in Lucas v. South Carolina, in which it was ruled that regulations depriving a property owner of all economic value in that property were a taking and most recently in last year’s Palazzo v. Rhode Island, in which the "notice rule" (limiting an owner’s right to compensation if property was purchased after the government action had taken place; that is, if I bought land on which development was already barred, I would couldn’t sue to demand compensation for that taking) was punctured.
But if there is any philosophical appeal in the conservative rollback of Warren Court-era rulings, it is in the two-part claim that federal judges should not be in a position of making laws best decided by Congress or the states and that no law, no matter how meritorious, should be created by the courts. As Richard Posner, a leading light of the law and economics school of conservative legal philosophy, put it in an argument with Alan Dershowitz:
The Warren Court decisions that you admire were not emanations of the constitutional text. Earl Warren, William Brennan, and Thurgood Marshall were not legal theoreticians. Their decisions were not compelled by existing legal understandings but rather were practical solutions to perceived social problems…
The other major school of conservative legal thought, "strict constructionism", holds that Constitutional questions are definitively answered by examining the original intent of the authors, and as this (liberal) historical review of the takings clause reveals, there’s little basis for thinking that the takings clause was ever meant to apply to anything other than actual, physical seizure of property, much as right-wing thinktanks might wish otherwise.
So Clarence Thomas’ dissent is based on a Constitutional reading that is less than twenty years old and seems to my untrained eye to let judges answer questions better suited for legislatures. And that brings us the Slate article. Although I think it’s dead wrong about the question that Stevens’ ruling was centrally focussed on, Stevens is right to point out that, if any interference by government on potential income were a taking, the role of government would grind to a halt. If the FDA yanks a drug with deadly side effects from the shelves, does it have to compensate the manufacturer for the lost profits? If the zoning board says that I am cannot start a liquor store next to a high school, must they compensate me for my theoretical lost profits? You can disapprove of these actions, but they aren’t weird anomolies. They’re the normal operation of government, and if you oppose them, you should be honest enough to say so.
Take it to the absurd, as a friend and self-described fan of neoclassical economic argument in law did in an email to me:
What if the government had to compensate you every time it required that you move your car out of a free parking spot so it could sweep under it? Would it have to negotiate a market-clearing price for you? It could set a level amount for every time, but then what would it do if you refused to accept that price? Would it fine you—hence, putting us back where we started—or would it just sweep around your car? According to the Tahoe piece, it should do the latter, but that just sets up a negative externality situation, and one in which there are so many actors that its unrealistic to think that the Coase theorem (which says independent parties can negotiate away any externality, provided property rights are assigned) would work.
Landsburg ignores the more important part of the ruling, that even lengthy temporary restrictions do not automatically constitute a taking, then plays around with the absurdity of every state action being a taking. But that’s evidence on the face of it that not every government interference in the marketplace is one, because surely the Founders didn’t intend to outlaw governance. Landsburg uses his thought experiment to mock Stevens’ ruling, but it seems to be a refutation of Thomas’ logic in dissent. When Landsburg writes, "When local landowners requested compensation for moratorium-related losses, the court turned them down. Why? Because, according to Justice Stevens, land-use regulation—and for that matter most other government activity—would be prohibitively expensive if governments bore all the costs," he’s letting the tail wag the dog. I usually enjoy Landsburg’s Slate articles, but this was either woefully confused on the Constitutional issue being decided (Landsburg is, after all, an economist and not a legal scholar) or an outright hatchet job.