Kelo v. City of New London, 545 U.S. 469 (2005),
What does redistributive mean. Well, remember that it was the liberal Left-Wing Justices of the U.S. Supreme Court that brought us this little jewel, holding that the government could take your real property, like your home, not for public use like a road or school, but to give to another private individual, such as a political contributor or other party hack or interest group.
Kelo v. City of New London, 545 U.S. 469 (2005), was a case decided by the Supreme Court of the United States involving the use of eminent domain to transfer land from one private owner to another to further economic development. The case arose from the condemnation by New London, Connecticut, of privately owned real property so that it could be used as part of a comprehensive redevelopment plan. The Court held in a 5-4 decision that the general benefits a community enjoyed from economic growth qualified such redevelopment plans as a permissible "public use" under the Takings Clause of the Fifth Amendment. Justice John Paul Stevens wrote the majority opinion; he was joined by Justices Anthony Kennedy, David Souter, Ruth Bader Ginsburg and Stephen Breyer
The decision was widely criticized by American politicians and the general public. Many members of the general public viewed the outcome as a gross violation of property rights and as a misinterpretation of the Fifth Amendment, the consequence of which would be to benefit large corporations at the expense of individual homeowners and local communities. Some in the legal profession construe the public's outrage as being directed not at the interpretation of legal principles involved in the case, but at the broad moral principles of the general outcome.
http://en.wikipedia.org/wiki/Kelo_v._City_of_New_London
The View From Israel
The country's central banker on Ben Bernanke and the global economic crisis.
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The Bailout Felt 'Round the World
A look at how an American made crisis has shaken economies the world over.
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Stanley Fischer may be thousands of miles from the epicenter of Wall Street's meltdown, but few people are better positioned to understand it. The 65-year-old former MIT economics professor supervised Ben Bernanke's doctoral thesis on the Great Depression. Later Fischer worked as a senior IMF official during the Asian financial crisis. Three years ago he moved to Israel after finance minister Benjamin Netanyahu persuaded him to leave his job at Citigroup and take over as the Jewish state's central banker. He spoke with NEWSWEEK's Kevin Peraino at his office in Jerusalem. Excerpts:
NEWSWEEK: What were the key lessons from Bernanke's research on the Great Depression?
Stanley Fischer: Ben has drawn two conclusions, which I think are right. The definitive [interpretation] when he was a student was that of [Milton] Friedman and [Anna] Schwartz, which was that the Fed didn't let the supply of money decline drastically [during the Great Depression]. Ben's thesis is: yes, but what really happened was that the credit mechanism collapsed. And it's clear from everything he's said that this emphasis on the credit system is still central to his thinking. And it happens to be correct. The second conclusion is that you've got to [ease the credit crunch] quickly. I'm sure nobody would say this in public, but if you make a few mistakes along the way, well, fine—keep going, fast.
Was it a mistake to let Lehman Brothers fail?
I think that'll be a big central question in the histories of this period.
What have been some of the other missteps so far?
There will be a question—and I'm as guilty as anybody—of what were we doing between July and August 2007 and now. There's also the issue of how you get the attention of the Congress. You can't go to them and say: I see a dark cloud on the horizon, and therefore I need $500 billion—give it to me because I'm worried. Part of the problem is that there were different views about what exactly needed to be done. A lot of people were saying that there should have been more focus on putting capital into the banks, but it's never the case that every economist is saying the same thing.
Where do you fall on that spectrum? Did you share the view of someone like Paul Krugman who was arguing for the government to take an equity stake in these banks?
I think it was clear that the government needed to inject capital into those banks. Whether it needed to take an equity stake immediately, or whether it wanted to put in something that gave it the option to take an equity stake later—that's a matter of judgment. But they had to get the money in, in quite significant amounts. [The risk is] that if the banks don't return to health in time, then presumably the government will find itself with very major stakes in a lot of banks. That will be kind of awkward.
Banks in Israel were only recently privatized. Will any need to be renationalized?
I don't think we're going to have to do it. But if the banking system gets into difficulties, then there's no question that the government will stand behind the banking system. I very much hope we don't get anywhere near that.
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