August 10, 2012
Is Generation Y Getting a Massive Wealth Transfer in the Form of Cheap Mortgages?
Karl Smith makes the case the young folks who recently bought homes will end up in a terrific financial position after the economy recovers:
Something which I don’t see talked about anywhere but I am pretty sure will be a significant story over the next decade or so is the massive wealth transfer now occurring in the United States towards the young middle class and the young upper middle class in particular. [...] The young middle class is incurring long term debts at extremely low interest rates, this includes education and housing debts. [...] Not, only are we talking about being mortgage free at 52, but mortgage payment as a fraction of income should decline to a basically nominal cost around age 40.
One thing I wish Smith had explored is the long-terms effects of these super cheap mortgages on labor mobility. If interest rates ever normalize, it's easy to forsee a lot of people staying in jobs and locations they don't really like in order to hang on to their 3.1% mortgages.
Mossoff on The Trespass Fallacy in Patent Law
Adam Mossoff (George Mason) has posted The Trespass Fallacy in Patent Law on SSRN. Here's the abstract:
The patent system is broken; so says the popular press, tech commentators, legal academics, lawyers, judges, and just about everyone else. One common refrain is that patents fail as property rights because patent infringement doctrine is not as clear, determinate and efficient as trespass doctrine is for real estate. This essay explains that this is a fallacious argument, suffering both logical and empirical failings. Logically, the comparison of patent boundaries to trespass commits what philosophers would call a "category mistake." It conflates the boundaries of an entire legal right (a patent), not with the boundaries of its conceptual counterpart (real estate), but rather with a single doctrine (trespass) that secures real estate only in a single dimension (geographic boundaries). Estate boundaries are defined along the dimensions of time, use and space, as reflected in numerous legal doctrines that secure estates, such as adverse possession, easements, nuisance, restrictive covenants, and future interests, among others. The proper conceptual analog for patent boundaries is "estate boundaries," not fences. Empirically, there are no formal studies of how trespass or even estate boundaries function in litigation; thus, complaints about the patent system’s indeterminacy are based solely on an idealized theory of how trespass should function; it's the nirvana fallacy. Furthermore, anecdotal evidence and related studies suggest that estate boundaries are neither as clear nor as determinate as patent scholars assume it to be. In short, the trespass fallacy is driving an indeterminacy critique in patent law that is both empirically unverified and conceptually misleading. Until the indeterminacy critique is properly modeled and grounded in facts, legislators and courts might want to pause before continuing to make fundamental structural changes to the American patent system.
August 9, 2012
Map of the Day: Segregation by Income in America
John also notes that The Pew Research Center has concluded that residential segregation by income has increased across the U.S. over the last thirty years. Twenty-seven of the 30 largest metro areas reported a jump in residential segregation. The Center's report ties the increase in residential segregation to the broader problem of income inequality and affirms that segregation by income remains "less pervasive than residential segregation by race.""
Nussbaum on ADR’s Place in Foreclosure
Lydia Nussbaum (Baltimore) has posted ADR’s Place in Foreclosure: Remedying the Flaws of a Securitized Housing Market on SSRN. Here's the abstract:
Millions of Americans lost their homes during the foreclosure crisis, an unprecedented disaster still plaguing local and national economies. A primary factor contributing to the crisis has been the failure of conventional foreclosure procedures to account for the new realities of securitization and the secondary mortgage market, which transformed the traditional borrower-lender relationship. To compensate for the shortcomings of conventional foreclosure procedures and stem the tide of residential foreclosure, state and local governments turned to ADR processes for a solution. Some foreclosure ADR programs, however, have greater potential to avoid unnecessary foreclosures than others. This article comprehensively examines the key components of foreclosure ADR programs and presents best practices for governments seeking to utilize ADR as a tool to mitigate the foreclosure crisis and re-energize the economy.
August 8, 2012
Land Use Planning v. Muddling Through
Sometimes planning scores an Olypmic-sized victroy, as this story from outside Washington, D.C. demonstrates:
Rockville and Gaithersburg are nearly identical in many ways, and usually get along. But they aren't happy with each other right now, as they fight over who will annex a property located in the narrow swath of unincorporated land between them. This fight shows how long-term planning works and why it is important.
The crux of their disagreement is that Gaithersburg wants to annex a piece of land near the Rockville border that Rockville has never annexed itself, but to which Rockville thinks it is entitled. [...] The State of Maryland requires incorporated cities to adopt a future expansion plan, showing areas that each city may want to annex in the future. The entire point of this requirement is to give cities the opportunity to show where their "unofficial" boundaries are, so that everyone can plan accordingly. And whether Rockville cares to admit it or not, they never made any kind of claim to the land in question until after Gaithersburg claimed it for itself,
(HT: Will Baude)
Penalver on De Soto
Eduardo Penalver (Cornell) has posted The Costs of Regulation or the Consequences of Poverty? Progressive Lessons from De Soto (Book Chapter) on SSRN. Here's the abstract:
Commentators have often characterized Hernando de Soto's advocacy of formalization of title for landless squatters as right-wing. And de Soto seems to understand himself as an advocate of individual property rights and free markets. But his analysis of informality and redistribution has a subtext with potentially progressive implications. Although de Soto sometimes reflexively attributes informality to overregulation, informality can always also be characterized as the consequence of being too poor to afford regulated goods. Indeed, for any particular regulation that puts the regulated good out of reach of the poor, we can either attribute this consequence to the cost of the regulation or to the consequences of a distribution of wealth that makes the regulated good unaffordable to those at the bottom. Thus, if the regulation is a good one, its effect on price, and therefore on informality, may argue in favor of keeping the regulation but redistributing purchasing power to blunt its pernicious impact on informality. What we need is a way of evaluating regulations that goes beyond merely observing their impact on the cost of goods and, indirectly, on the prevalence of informality. Specifically, we need to be able to evaluate four different possibilities: (1) regulation with redistribution to offset the impact of the regulation on the poor; (2) regulation without redistribution with its attendant increase in informality; (3) redistribution without regulation; and (4) no redistribution and no regulation. Choosing among these options is the domain of applied political theory. The choice is a far more complicated and demanding task than merely observing that regulation without redistribution increases informality.
August 7, 2012
ABA-RPTE "Professors' Corner" Teleconference on Land Use Cases
The Legal Education and Uniform Laws Group of the ABA Real Property, Trust and Estate Law Section invites you to join the free monthly teleconference, Professors’ Corner, which each month features a panel of professors discussing one or more cases/issues of interest to real estate practitioners and scholars.
This month’s call is Wednesday, August 8, 2012, at 12:30pm Eastern, 11:30 am Central, 9:30am Pacific.
Call-in number: 866-646-6488
Participant Passcode: 5577419753
The call, moderated by Professor James Geoffrey Durham of the University of Dayton School of Law, features three land use scholars discussing recent cases of interest:
Professor Stephen R. Miller, Associate Professor, University of Idaho College of Law, will be discussing a pending California case, San Francisco Beautiful v. City and County of San Francisco, et al. (Case No. CPF-12-512217, S.F., Cal., Superior Court). The suit challenges the City’s settlement agreement with Metro Fuel, LLC (“Fuel”) that would have ended litigation initially brought by Fuel. The conversation will first focus on procedural challenges made by the San Francisco Beautiful petition, then turn to Fuel’s constitutional claims in this and other cases (Metro Fuel LLC v. City of San Francisco, C 07-6067 PJH, 2011 WL 900318 (N.D. Cal. 2011); Metro Lights LLC v. City of Los Angeles, 551 F.3d 898 (2009), cert denied, 130 S. Ct. 1014 (2009).), which have resulted in some of the most salient discussions of Metromedia’s legacy, and the constitutionality of advertising sign regulation generally, in recent years.
Professor Troy A. Rule, Associate Professor, University of Missouri, Columbia, School of Law, will focus on SNPCO, Inc. v. City of Jefferson City, 2012 WL 987998, a recent Tennessee Supreme Court case analyzing a nonconforming use statute in the context of an annexation. In SNPCO, the court refuses to allow a fireworks store to continue operating as a preexisting nonconforming use when a city annexes the store property, holding that Tennessee’s nonconforming use statute applies only to zoning and that annexation is not a zoning matter under the statute.
Professor Kenneth Stahl, Associate Professor and Director, Environmental, Land Use, and Real Estate Law Certificate Program, Chapman University School of Law, will focus on Borough of Sayreville v. 35 Club, LLC, 33 A.3d 1200 (N.J. 2012), a recent New Jersey Supreme Court case discussing the constitutionality of municipal zoning regulations that restrict locations for adult businesses. In 35 Club, the court held that in determining whether a municipality’s zoning ordinance restricting the location of adult businesses violates the first amendment, trial courts should look to whether adult businesses can find adequate locations elsewhere in the market area, including municipalities across state lines.
Copies of these opinions can be found on the Legal Education and Uniform Laws Group website, http://apps.americanbar.org/dch/committee.cfm?com=RP190000.
Is Obama Bombing the Suburbs?
Stanley Kurtz argues that President Obama is on a covert mission to destroy the suburbs:
President Obama is not a fan of America’s suburbs. Indeed, he intends to abolish them. With suburban voters set to be the swing constituency of the 2012 election, the administration’s plans for this segment of the electorate deserve scrutiny. Obama is a longtime supporter of “regionalism,” the idea that the suburbs should be folded into the cities, merging schools, housing, transportation, and above all taxation. To this end, the president has already put programs in place designed to push the country toward a sweeping social transformation in a possible second term. The goal: income equalization via a massive redistribution of suburban tax money to the cities.
Matthew Cantirino slams Kurtz's viewpoint. "It’s rather baffling," Cantirino writes, "for people who profess to be concerned about culture to jumpily exempt large swaths of its constitutive elements (like, say, the physical arrangement and daily routine of peoples’ lives, jobs, and commutes) from any sort of real criticism."
(HT: Andrew Sullivan)
Dyal-Chand on Comparing Property to Other Rights Enumerated in the Bill of Rights
Rashmi Dyal-Chand (Northeastern) has posted A Poor Relation?: Reflections on a Panel Discussion Comparing Property Rights to Other Rights Enumerated in the Bill of Rights (William & Mary Bill of Rights Journal) on SSRN. Here's the abstract:
The purpose of this Essay is to summarize and reflect upon the second panel discussion at the Third Annual Brigham-Kanner Property Rights Conference at William & Mary School of Law, October 6-7, 2006. The panel was entitled "Comparing the Treatment of Property Rights to the Protections Given to Other Rights Under the Bill of Rights." As described by Professor Eric Kades, the organizer of the conference, the panel's topic was inspired by a statement by Justice Rehnquist in the case of Dolan v. City of Tigard: "We see no reason why the Takings Clause of the Fifth Amendment, as much a part of the Bill of Rights as the First Amendment or Fourth Amendment should be relegated to the status of a poor relation..." By virtue of their location in the Bill of Rights are the property rights embodied in the Fifth Amendment as important as the other rights in the Bill of Rights? Are they somehow even more important? Are there any textual or other reasons to treat these rights differently from other rights in the Bill of Rights? These were among the questions addressed by the panel participants and the thoughtful discussion that followed their presentations.
This Essay will proceed as follows. Part I will summarize the major points raised by each of the panelists. It is important to note at the outset that this summary is not an attempt to capture everything that each of the panelists said. Indeed, many important details and subtleties will be omitted here. Nor does it necessarily reflect the points each speaker empahasized. Rather, I seek in this Part to draw out common themes among the panelists. Part I will also summarize the discussion that followed the presentations. Part II will explicate and reflect upon some of the major themes that were raised.
August 6, 2012
Thirty Years of Urban Growth
The Atlantic Cities blog has composed a bunch of stunning images from data collected by NASA satellites. The GIFs show, in dramatic fastion, the growth of urban regions around the globe since the mid-1980s. The pictures are really incredible and well-worth your time.
Sage on Original Acquisition and Kant
N.W. Sage (Toronto) has posted Original Acquisition and Unilateralism: Kant, Hegel, and Corrective Justice (Canadian Journal of Law and Jurisprudence) on SSRN. Here's the abstract:
In an original acquisition of property, a person acquires a previously unowned thing just by taking control of it. Many legal theorists have found original acquisition problematic because it seems to involve the acquirer, through a merely “unilateral” act, imposing new duties on other persons, who must now respect the acquirer’s property right.
This paper considers the problem of unilateralism from the standpoint of a Kantian theory of property law. Recently, theorists such as Ernest Weinrib and Arthur Ripstein have argued that, from a Kantian standpoint, original acquisition is problematic because it allows the acquirer unilaterally to constrain other persons’ freedom. The Kantian solution, they contend, is the creation of a “civil condition” of public legal institutions, which determine and enforce everyone’s property rights, thereby transforming original acquisition into an act that is “omnilateral” in character.
This paper argues that the proposed civil condition solution is unsuccessful. Indeed, if original acquisition is problematically unilateral because it constrains freedom, then Kant’s normative system — founded upon a principle of equal freedom — is unable to resolve the problem. But in any event, the paper argues, from a Kantian standpoint there is no problem of unilateralism in the first place. Original acquisition is not unilateral in a way that is problematic for Kant because it does not constrain others’ “freedom” in the Kantian sense of that term.
This also explains why Hegel, whose account of property is otherwise similar to Kant’s, saw no problem of unilateralism worth mentioning. And it means that any corrective justice theory of private law that is linked to a Kantian or Hegelian account of property rights will be untroubled by original acquisition.