Topic: Law and Civil Liberties

No Way (to Violate Property Rights), San Jose

A San Jose ordinance requires developers to set aside 15 percent of their units for sale at an “affordable housing cost.” Those affordability restrictions remain in effect for 45-55 years. If developers don’t want to set aside affordable housing units, they have the option to build affordable units elsewhere, pay a fine, dedicate land for affordable units, or acquire or rehabilitate existing affordable units.

However laudable it is to construct affordable housing, the city is essentially appropriating part of the developers’ property for its own uses or conditioning the issuance of permits on paying out large amounts of money. The California Building Industry Association (CBIA) filed suit, arguing that the city’s restrictions violate the Fifth Amendment’s Takings Clause, which prohibits the government from taking private property for public use without just compensation.

Previous Supreme Court decisions, including Koontz v. St. Johns River Water Management District from 2013 (which Cato supported), held that such conditions on building permits can violate the Takings Clause if the exaction—whether a fine or a requirement to set aside affordable housing—is unrelated to the proposed building project. It would thus be unconstitutional to condition a permit for a housing development on the construction of a new library, because the library has nothing to do with the proposed building project.

In the CBIA case, however, the California Supreme Court ruled that, because the conditions in San Jose derive from a legislative act rather than an ad hoc permitting condition, the U.S. Supreme Court’s clear precedents don’t fully apply. The CBIA has asked the U.S. Supreme Court to set the California Supreme Court straight by making clear that the Takings Clause prohibits such permitting conditions whether they come from a legislature or a discretionary permitting process.

Cato, joined by the Reason Foundation, has filed a brief in support of the CBIA’s petition. We argue that there’s no basis in the Takings Clause for distinguishing between legislative conditions and ad hoc permitting conditions. To the landowner or the developer, the effect is the same: the government imposes onerous conditions before allowing them to use their land. Moreover, legislatively imposed conditions are worse because they have broader effects, thus magnifying the unconstitutional harms to property owners.

Finally, there’s no reason to expect less abuse from the legislature than from permitting officials. Legislatures are prone to being captured by special interests who demand all sort of exactions from and conditions on landowners. Government officials, whether they are legislators or permitting clerks, often see taking property without compensation as a way to get something for nothing.

The Supreme Court should take this case and say that this ain’t okay, San Jose.  

Judicial Engagement, Illustrated

Does the government need to offer you a good reason when it restricts your liberty? Most Americans would likely answer “yes.”  But what’s a “good reason?” Must the government’s allegedly “good” reasons be supported with evidence or should courts just give the government the benefit of the doubt?

Both progressives and conservatives often do ask judges to put a thumb on the judicial scales in the government’s favor. Progressives see government as generally a force for good (except when certain preferred rights are threatened, as defined by progressive elites), while conservatives want judges to defer to the elected branches (except when Obamacare or other disfavored federal programs are at issue). Thus we have the twin scourges of judicial adventurism and minimalism – rewriting or ignoring inconvenient constitutional or statutory provisions – instead of unblinkered judicial enforcement of the law. 

In other words, both progressives and conservatives miss the boat when they focus on judicial modes (whether a ruling is “activist,” an empty term meaning that its user disagrees) rather than interpretative theories (originalism vs. living constitutionalism, textualism vs. purposivism). Indeed, even people who care about judicial modes should want judges who apply their preferred interpretive theory without regard to extra-legal considerations and without adopting biases towards the government or any other type of party. The nomenclature is less important than the substance, but “judicial engagement” is increasingly becoming the name for the alternative to the wholly unsatisfactory debate about judicial “activism” and “restraint.”

Border Patrol Out Of Control

Today, the ACLU’s Border Litigation Project released a damning report on the Department of Homeland Security’s Customs and Border Protection “interior operations” that should serve as a wake up call for Washington policy makers.

Titled “Record of Abuse: Lawlessness and Impunity in Border Patrol’s Interior Enforcement Operations”, the 31 page report is supplemented by hundreds of pages of documents obtained through an ongoing Freedom of Information Act lawsuit. The ACLU Arizona chapter’s summary of the report noted the following: 

Border Patrol’s records contain recurring examples of agents terrorizing motorists far into the interior of the country; detaining and searching innocent travelers after false alerts by service canines; threatening motorists with assault rifles and other weapons; destroying personal property; and interfering with attempts to video record agents. These abuse records substantially outnumber the annual complaint totals DHS oversight agencies disclosed to Congress.

Border Patrol does not record stops of motorists that do not result in arrest, or false canine alerts that lead to searches of innocent suspects.  Substantive investigations into civil rights violations are rare and almost never result in disciplinary consequences. Despite numerous reports of abuse and corruption, the records contain only one example of disciplinary action of any kind.

Border Patrol’s own data undermines the agency’s public claims that checkpoints are efficient and effective: in 2013, Tucson Sector checkpoint apprehensions accounted for only 0.67 percent of the sector’s total apprehensions. The same year, Yuma Sector checkpoint arrests of U.S. citizens exceeded those of non-citizens by a factor of nearly eight (and in 2011, by a factor of eleven).

Magna Carta Has Chinese Officials Running Scared

Cynics, and sometimes realists too, dismiss the power of ideas. Tyrants don’t. The latest evidence comes from today’s New York Times, where we learn that a planned public display of Magna Carta at a museum at Beijing’s Renmin University has Chinese officials “running scared.” Accordingly, “the exhibit was abruptly moved to the British ambassador’s residence, with few tickets available to the public and no explanation given.”

While much of the world is celebrating the 800th anniversary of this muniment of English and American liberties—a cornerstone for constitutional government—“such a system is inimical to China’s leaders, who view ‘constitutionalism’ as a threat to Communist Party rule,” the Times reports. And that it is, as I detailed some time ago in a chapter contrasting the Chinese and American constitutions. Indeed, the very name “Magna Carta” is forbidden in China, the Times notes:

In 2013, the party issued its “seven unmentionables” — taboo topics for its members. The first unmentionable is promoting Western-style constitutional democracy. The Chinese characters for “Magna Carta” are censored in web searches on Sina Weibo, the country’s Twitter-like social media site.

A representative of the British Foreign Office said the decision to display Magna Carta at the residence was “based purely on administrative and logistical practicalities.” As we say on this side of the pond, “Yeah right.” Doubtless, that response too would get you in trouble in today’s China.

The Fed’s War on Drugs, Round Two

Back in August I wrote here about the Federal Reserve Bank of Kansas City’s refusal to grant a master account, and to thereby allow access to the Fed’s payment facilities, to The Fourth Corner Credit Union (TFCCU), a Colorado-based credit union intended to serve as a banker to that state’s marijuana-related businesses. In response TFCCU sued the Kansas City Fed, primarily on the grounds that its refusal was contrary to the 1980 Depository Institutions Deregulation and Monetary Control Act (DIDMCA) requirement that “All Federal Reserve bank services…shall be available to nonmember depository institutions and such services shall be priced at the same schedule applicable to member banks.”

A month ago, on September 10, 2015, the Kansas City Fed filed a motion to dismiss, offering, among other grounds, the claim that the above-mentioned DIDMCA statute “pertain’s only to the ‘principles’ for setting a ‘schedule of fees’,” and that it therefore “does not mandate that FRB-KC grant any entity — let alone TFCCU — a master account.” In other words, according to the Fed’s lawyers, it is illegal for the Kansas City Fed to charge TFCCU more for its services than it charges to other applicants so long as the charge in question is finite, but it is legal for them to refuse the service altogether, that is, to make the charge for it infinite!

According to TFCCU’s own, less twisted reading of the law, as expressed in its counter motion, Congress never intended to delegate to either the Kansas City Fed or to any other Federal Reserve Bank “unbridled discretion to act as gatekeeper of the nation’s central bank,” and the Kansas City Fed is therefore duty-bound to “respect state sovereignty under the Tenth Amendment by not acting to nullify state charters.”

In drawing my attention to the FRB-KC’s motion to dismiss, Mark Mason, TFCCU’s counsel, points out that, when that motion doesn’t rest upon a contorted interpretation of Federal law, it is “hypocritical and illogical”:

It is hypocritical and illogical that FRB-KC would argue in its motion to dismiss that “other financial institutions [are] providing banking services to marijuana-related entities” using Reserve Bank master accounts, but that TFCCU cannot do so on the same terms because TFCCU proposes to do so expressly. …

FRB-KC’s argument is illogical because the only way a financial institution can legally serve an MRB [Marijuana-Related Business] is expressly, as [according to FinCEN guidelines] it has to file Marijuana Limited SARs [Suspicious Activities Reports] for every MRB account. It appears FRB-KC wants to punish TFCCU for being open and transparent about an aspect of its business plan, while at the same time allowing Reserve Bank services to be used to serve MRB’s–so long as the use is covert, not express.

Last week, TFCCU followed-up on its counter-motion by moving for a summary judgment on the claims made in its original complaint. According to that motion’s “Statement of Undisputed Facts,”

Colorado is a sovereign state. Colorado issued a credit union charter to TFCCU. TFCCU, by virtue of its charter, is a depository institution. TFCCU requested that FRB-KC issue a master account to TFCCU so it could thereby access essential Federal Reserve Bank (“FRB”) payments services. FRB payments services give a depository institution the ability to effectuate the electronic transfer of funds. FRB-KC refused to provide payments services to TFCCU. TFCCU asserts FRB-KC is mandated by a clear statutory command to provide all depository institutions with access to FRB payment services pursuant to the MCA, 12 U.S.C. §248a. This is a case of statutory construction.

In further correspondence Mason adds:

It is an important point that Fourth Corner represents a social movement grounded in state’s rights, liberty and wellness. It’s potential membership extends to supporters of the movement and to the licensed marijuana industry as federal law evolves in that aspect. In the case against FRB-KC the issue is equal access.

The main entrance to the Kansas City Fed’s recently-built Memorial Drive headquarters is flanked by twelve-foot high bronze statues representing the Spirits of Industry and Commerce. Alas, in view of what the Kansas City Fed has been up to, one can only wonder whether those great goddesses are standing out there because it has refused to let them in.

[Cross-posted from Alt-M.org]

Snowden, Surveillance, and Democrats: Debate Observations

The first debate among Democratic presidential contenders was more than half over before moderator Anderson Cooper of CNN got around to asking a question about the biggest intelligence scandal in more than 40 years. You can read the full transcript here but the exchanges between Cooper and the candidates on Edward Snowden (via Ars Technica) is what’s worth the read:

COOPER: Governor Chafee, Edward Snowden, is he a traitor or a hero?

CHAFEE: No, I would bring him home. The courts have ruled that what he did—what he did was say the American…

(CROSSTALK)

COOPER: Bring him home, no jail time?

CHAFEE: … the American government was acting illegally. That’s what the federal courts have said; what Snowden did showed that the American government was acting illegally for the Fourth Amendment. So I would bring him home.

COOPER: Secretary Clinton, hero or traitor?

CLINTON: He broke the laws of the United States. He could have been a whistleblower. He could have gotten all of the protections of being a whistleblower. He could have raised all the issues that he has raised. And I think there would have been a positive response to that.

COOPER: Should he do jail time?

ClINTON: In addition—in addition, he stole very important information that has unfortunately fallen into a lot of the wrong hands. So I don’t think he should be brought home without facing the music.

COOPER: Governor [Martin] O’Malley, Snowden?

(APPLAUSE)

O’MALLEY: Anderson, Snowden put a lot of Americans’ lives at risk. Snowden broke the law. Whistleblowers do not run to Russia and try to get protection from Putin. If he really believes that, he should be back here.

COOPER: Senator Sanders, Edward Snowden?

SANDERS: I think Snowden played a very important role in educating the American people to the degree in which our civil liberties and our constitutional rights are being undermined.

COOPER: Is he a hero?

SANDERS: He did—he did break the law, and I think there should be a penalty to that. But I think what he did in educating us should be taken into consideration before he is (inaudible).

Third Circuit Reinstates Muslim Discrimination Suit against the NYPD

Yesterday, in a case called Hassan v. The City of New York, the Third Circuit Court of Appeals reinstated a lawsuit accusing New York City of violating the 1st and 14th Amendment rights of Muslim-Americans in New Jersey under a sprawling and ineffective NYPD surveillance dragnet.

The ruling overturns a decision by the United States District Court for the District of New Jersey dismissing the suit for lack of standing and for failing to state a claim.

In layman’s terms: the district court, without a trial or the presentation of evidence, ruled that the plaintiffs weren’t harmed unjustifiably, that they hadn’t alleged sufficient wrongdoing by the police, and that they had no right to sue.  The Third Circuit ruling rejects those determinations and the case will now move forward at the district court.

An Associated Press investigation uncovered the NYPD program in 2011 and detailed the immense breadth of the NYPD’s surveillance efforts against the Muslim community in several states.  Police officers and informants infiltrated dozens of mosques. Police installed surveillance cameras so that Muslim-owned businesses, places of worship, and residences in New Jersey could be surveilled remotely. The NYPD even sent undercover officers to infiltrate Muslim student organizations at out-of-state universities such as Yale and the University of Pennsylvania, including one field trip to go whitewater rafting.  Those agents recorded the names of the students, how often they prayed, and what they talked about.  The NYPD is alleged to have “generated reports on every mosque within 100 miles of New York City.”

Despite the cost and the seemingly boundless geographic and jurisdictional scope of the spying program, there is little evidence of success.  In fact, the now-defunct “Demographics Unit,” a central component of the program, generated no convictions or, according to one agent deposition, even any tangible leads in more than a decade of operation.