“Junk Science” Is Inadmissible in Court, But Junk Economics is Jim-Dandy

It has been a while since the U.S. Supreme Court decided Daubert v. Merrell Dow Pharmaceutical (1993) 509 U.S. 579, and held that evidence properly presented in court may not include “junk science;” that to the extent scientific matters are admissible into evidence, they must be consistent with prevailing views of the pertinent scientific community. You can’t just make up stuff you find congenial to your client’s interest, get a compliant “expert” witness to mouth it, and treat it as reliable scientific evidence.

But it turns out that when it comes to eminent domain, it’s a whole other story. What passes for “law” in this field may be based on government-presented denial of reality. You don’t believe us, do you?

Take a look at the recent 9th Circuit opinion in Colony Cove Properties v. City of Carson (9th Cir. 2011) 640 F.3d 948. Colony Cove was another one of those wretched mobile home park rent control cases, in which the landlord-park owner lost (don’t they all?) thereby reminding us of the wit of the late, lamented Professor Donald G. Hagman, of UCLA, a fair-minded academic giant in the land-use law field, who once joked that it is an overarching principle of law that “gravel pits lose.” Now, it would appear that gravel pits have been joined by rent-controlled mobile home parks whose owners somehow never manage to present a proper case for relief when they argue that the controlled rent is so low as to deprive them of the value of their land to the point of becoming a taking. Whenever they sue, it’s in the wrong court, either too early or too late – there are even cases saying that it was both too early and too late.

One big problem with rent control in general, is that it does not, in fact, lower or control the cost of housing, and this is a fortiori so in mobile home rent control where incoming new tenants are charged exorbitant rents poorly disguised as prices charged by departing tenants for their mobile homes which are usually left behind because they cannot be moved economically and the departing tenants (who own them) usually lack a place to put them when they move.  Thus in the Guggenheim case (of which more in a moment), in order to get into a rent controlled mobile home park, incoming tenants had to pay on the average over $120,000 to the departing tenants, ostensibly for an old mobile-home coach worth as little as $4600, because that was the only way they could get into the park.

Thus, as demonstrated in Guggenheim, under these circumstances rent control does not control rents; it does the opposite, forcing incoming low-income tenants to pay or finance $120,000 up front in order to gain the “privilege” of living in a nominally rent-controlled mobile home park — that $120 grand being a thinly disguised capitalized value of the right of occupancy at market — not controlled — rents.

As conceded by economists across the ideologivcal spectrum, far from controlling rents,  this type of rent control merely rips off incoming tenants in the name of protecting them. So being an intelligent, well-educated person (which we assume correctly characterizes the readers of this blog) you may well ask: if indeed rent control (which in theory is intended to keep rents down for low-income folks) accomplishes the opposite and actually increases them, isn’t it inherently irrational in operation? And haven’t we been taught in law school that irrational statutes are unconstitutional? Well yes, we were. So what? This is the law of eminent domain, dudes, so what does rationality have to do with anything?

Case in point, the Colony Cove court’s discussion of this matter. It relied on a passage from the Guggenheim case (638  F.3d 1111, at 1123). Much could be said about this passage, but it seems to us that to quote it is to make the point:

“Whether the [City’s] . . . economic theory for rent control is sound or not, and whether rent control will serve the purpose stated in the ordinance is sound or not, and whether rent control will serve the purpose stated in the ordinance of protecting tenants from housing shortages and abusively high rents or will undermine their purposes, is not for us to decide. We are a court, not a tenure committee, and we are bound by precedent establishing that such laws do have a rational basis. Students in Economics 101 have for many decades learned that rent control causes the higher rents and scarcity it is meant to alleviate, but the Due Process Clause does not empower courts to impose sound economic principles on political bodies.” Emphasis added.

Wow! Think of what that sort of reasoning could do for energy preservation. Maybe engineering students have for many decades been taught that the laws of thermodynamics make the operation of perpetual motion machines impossible, but the Due Process Clause does not empower courts to impose sound engineering principles on political bodies which are free to legislate the use of such machines if they think that will save energy.

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