I had a piece in the Herald Sun on Friday (pay walled) that addressed the property theft governments perpetrate to pursue their goals.
In the case of NSW farmer Peter Spencer, the NSW government progressively rezoned his land until it was worth a fifth of its previous value then offered to buy it at the reduced value.
The land theft was conducted, at least in part, so that the Commonwealth could meet its Kyoto commitments on greenhouse gas emissions. Cynically speaking, the government recognised it is much less likely to incur voter wrath if it pays for things by taking the funds only from a small number of people.
Without shame, courts condone land theft when it is state governments that perpetrate it (on grounds that there is no specific provisions in state constitutions stopping governments doing so). Thus in the Peter Spencer case, the court found that the land value had been taken by the NSW government without compensation but that was all ok. In a variation of the theme, ‘If rape is inevitable ……’ the judge, recognising that Mr Spencer had been ruined, suggested that he should have taken the compensation that was offered him.
But the judiciary also finds opportunities to sidestep the provisions in the Australian Constitution that have been interpreted as requiring compensation for a taking, a la The Castle’s Darryl Kerrigan. Thus, with regard to the connection between the taking and the Commonwealth’s benefit, the Federal Court, employed sophistry to avoid compensating for the theft, claiming that value had been “extinguished” rather than “taken”. And the judge blindly avoided recognising a connection between the NSW government’s actions and commonwealth pressure.
This was notwithstanding Premiers Beattie and Carr proudly proclaiming how their actions in preventing land clearances had enabled the meeting of the Kyoto commitments. Moreover, when Dr David Kemp was the Environment Minister, Canberra withheld money until the NSW had become more aggressive in stopping the land clearing that was essential if the Kyoto commitments were to be met.
Dr Kemp acknowledged communicated this to the NSW Government. He said there was no intention to acquire property – at least that of Spencer – on other than just terms. There is however no record of him seeking such compensation provisions in the course of pressuring the NSW to take regulatory action to prevent clearing.
Barnaby Joyce has suggested that the expropriation of farmers for the carbon sequestration alone had cost them $200 billion. This figure (which was not contested in the Parliament) was arrived at by comparing land values where regulation prevented productive use, to values of land that was unaffected.
From medieval times, common law and commercial law developed on the basis of judgements grafting common sense to principles of fairness in dealing with property. “Merchant law” was enforced by embargos on jurisdictions that got bad reputations for dishonesty. In England, Magna Carta and its many pre-cursers and reaffirmations was essentially about preventing the king taking property. And “just terms” became the Fifth Amendment of the American Constitution in 1790 once the former colonials realised that the absence of a king did not mean the absence of potential sovereign seizure.
We are seeing a judiciary that has ceased to be the impartial protector of property rights that was its original contribution to nurturing prosperity. Justice and liberty aside this has deep seated implications for the efficient operation of economies. Individuals’ uncertainties over the rights to enjoy and prosper from ownership of property will mean a weakening of the wealth creation process.