Libertarian law professor Richard Epstein's column this week is about the City of Richmond, California and its Green Party mayor's effort to use the power of eminent domain to restructure residential mortgages. He writes:
property owners, both in Richmond and elsewhere, are long term losers if it becomes impossible for homeowners in hard-pressed communities to borrow funds from banks that won't lend when they know that these loans can be taken from them. The situation is doubly troublesome today now that housing prices are coming back making Richmond's operating premise of widespread failure ever more questionable.Housing markets need time to heal, which they won't get if these ill-advised condemnation schemes live to see the light of day. Once again for government, doing nothing is often doing the best thing possible.