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Government Seizure of Private Assets: A Clear and Present Danger to America

In 1920’s Chicago, when Al Capone ran his notorious crime gang from Cicero Illinois, no one would have been surprised to hear about policemen “on the take”, and corrupt government officials. But the fact is that in 2011, private property is often unjustly confiscated and held indefinitely – even permanently – across the United States. One of the best accounts of this situation can be reviewed in a multi-page expose’ authored by Radley Balko entitled: The Forfeiture Racket (http://reason.com/archives/2010/01/26/the-forfeiture-racket). It happens at every level from local city police forces to the US Justice Department. It has been reported everywhere from the television show 60 Minutes (http://www.cbsnews.com/stories/2003/09/26/60minutes/main575343.shtml) to Louisiana State University (http://biotech.law.lsu.edu/cdc/cdc-2006.htm) and it seems to be worsening every year.

Proponents of constitutional law are becoming fearful that it’s not just property at risk – it may soon be forced labor as well. As LSU’s school of law points out: “While the government might seize a hospital, it could not operate it without its staff. This raises the question of whether the government, and especially the states, can force people to work at their jobs. Since surveys show that significant numbers of health care workers will not show up for work during an emergency such as a flu pandemic, it can be expected that absenteeism will be even higher if there is a government seizure. If the workers do not trust the government to run the facility safely, which is likely in the light of government actions taking in the wake of Hurricane Katrina, few workers may be willing to stay in their jobs. There is very little precedent for forced work, outside the military and jury duty, and a real question about its constitutional limits. This leads many public health law experts to advise negotiated agreements with facilities, based on regulatory powers, rather than seizures under the police power.”

Seizure of Property Through “Imminent Domain”

Almost everyone is, by now, familiar with the problems created by abuse of imminent domain legislation. As Warren Richey pointed out in the Christian Science Monitor last year, the Supreme Court recently decided “Government officials do not violate the US Constitution when they seize and demolish homes and businesses to make room for private development. In a major decision that narrows the constitutional protection of property owners, the US Supreme Court ruled Thursday that the Fifth Amendment’s Takings Clause authorizes government seizure of private property even when it merely offers a benefit to the public, rather than actual public use. The 5-to-4 decision means that state and local officials can continue to use the government’s power of eminent domain to take private property and turn it over to a private builder as a form of economic development.” In her dissenting opinion, Justice Sandra Day O’Connor warned that the ruling could bring dangerous consequences for owners of homes and other properties. “Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded,” she wrote, and she is absolutely correct.

Seizure of Private Assets Such as Money, Tools, and Automobiles

There have been a plethora of stories on this topic over recent years, but the situation continues to worsen. (http://trueslant.com/allisonkilkenny/2010/03/31/asset-seizures-an-industry-of-legalized-stealing/) In an article entitled “Asset Seizures: An Industry of Legalized Stealing”, Allison Kilkenny says: National Public Radio has reported that between 2003 and 2007, the amount of money seized by local law enforcement agencies enrolled in the federal forfeiture program tripled from $567 million to $1.6 billion. Almost half of surveyed police departments with more than 100 law enforcement personnel said forfeiture proceeds were “necessary as a budget supplement” for department operations. So what we have here is desperate, broke police departments that have been serving under a “Gut The State” federal government (facilitated by both Republican and Democratic leadership) for decades, and so the cops are understandably looking to bring in new funding. Unfortunately, they’ve resorted to stealing from taxpayers, and the bullied, intimidated, and most importantly, poor citizenry can’t afford to fight back. More than 80 percent of federal seizures are never challenged in court, according to [attorney David Smith, author of the legal treatise Prosecution and Defense of Forfeiture Cases]. To supporters of forfeiture, this statistic is an indication of the owners’ guilt, but opponents argue it simply reflects the fact that in many cases the property was worth less than the legal costs of trying to get it back.” Recently, the Institute for Justice launched a national campaign against civil asset forfeiture (h/t Agitator). Their official website says: “civil forfeiture laws represent one of the most serious assaults on private property rights in the nation today.” In addition, a 2001 study published in the Journal of Criminal Justice, the University of Texas at Dallas criminologist John Worral surveyed 1,400 police departments around the country on their use of forfeiture and the way they incorporated seized assets into their budgets. Worral observed: “a substantial proportion of law enforcement agencies are dependent on civil asset forfeiture”, saying: “forfeiture is coming to be viewed not only as a budgetary supplement, but as a necessary source of income.” Almost half of surveyed police departments reported that forfeiture proceeds were “necessary as a budget supplement” for department operations.

Coordinated Government Theft

It is commonly thought that – especially when it comes to enforcing the law, US agencies have a lot of trouble communicating effectively. We all heard a lot of accounts of various emergency response organizations with radios and telephone that did not enable effective communications between firefighters, police, and other rescue workers around the 9/11 tragedy, and the Hurricane Katrina disaster. But it seems that when it comes to confiscating private property and keeping it, law enforcement agencies show remarkable levels of camaraderie. Consider Missouri police agencies and the Federal Drug Enforcement Agency, for example. As Balko points out: “In Missouri, for example, forfeited property is supposed to go to the state’s public schools. But in 1999 a series of reports in The Kansas City Star showed how Missouri police agencies were circumventing state law. After seizing property, local police departments would turn it over to the DEA or another federal agency. Under federal law, the federal agency can keep 20 percent or more of the money; the rest, up to 80 percent, goes back to the local police department that conducted the investigation. None of the money in these cases goes to the schools. The Kansas City Star investigation made national news at the time, but …. the practice of circumventing earmarking through federal “adoption” is now common all over the country. “It happens a lot,” he says. “It clearly goes against the intent of the state legislatures that passed these laws, but I don’t know of any state that has made a serious effort to prevent it from happening.”

Another Unholy Alliance: Private Industry and Federal Government

Recently, the Federal Government has approved of – if not directly participated in – the theft of retirement funds from American workers, with one of the most notable examples coming from the now-largely-government-owned General Motors & Delphi corporations. In her September 2010 article” The Delphi Disaster: An Economic Horror Story Obama Won’t Tell” (http://michellemalkin.com/2010/09/22/special-report-the-delphi-disaster-an-economic-horror-story-obama-wont-tell/), Michelle Malkin reports: “Consider the real-life horror story of 20,000 white-collar workers at Delphi, a leading auto parts company spun off from GM a decade ago. As Washington rushed to nationalize the U.S. auto industry with $80 billion in taxpayer “rescue” funds and avoid contested court termination proceedings, the White House auto team schemed with Big Labor bosses to preserve UAW members’ costly pension funds by shafting their nonunion counterparts. In addition, the nonunion pensioners lost all of their health and life insurance benefits. The abused workers — most from hard-hit northeast Ohio, Michigan and neighboring states — had devoted decades of their lives as secretaries, technicians, engineers and sales employees at Delphi/GM. Some workers have watched up to 70 percent of their pensions vanish.” Absolutely right. One of my family members, who was a GM employee and eventually a Delphi employee for 36 years told me recently: “Bill the $300,000 was money that my husband and I lost in Delphi and GM Stock when both stocks went to zero because of bankruptcy. I lost over $1700.00 per month in pension payments because I was above the PBGC max amounts. I also lost all insurances. I had paid into my optional life insurance for over 30 years and it just went away with a stroke of a pen.”

In a September 2010 article by Peter Raymond entitled “Retirement Fund Trillions Lure Government Grabbers” (http://www.americanthinker.com/2010/09/retirement_fund_trillions_lure.html) , these words appear: “Is the government making plans to confiscate your retirement money? The Obama administration is certainly exploring the idea. According to the Investment Company Institute, there was $7.835 trillion in IRA, 401K, 457, and 403b accounts in 2009. That is certainly too large a sum to be ignored by the big spending social engineers in Washington. Bureaucrats and politicians have been hard at work formulating a social justice excuse to legislate an historic seizure of private assets. This would not be the first time the statists extorted wealth from U.S. citizens on a massive scale. The public shakedown always employs a two-step tactic to repeatedly dupe the malleable electorate. First, the statists fabricate and incessantly excoriate a contrived crisis of social injustice that is victimizing helpless and unknowing Americans. Next, they “craft” — a term Pelosi uses again and again — insidious legislation disguised as a necessary and compassionate solution that makes participation and universal funding compulsory by force of the law. In February, the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA), in collaboration with the Department of Treasury, announced a “request for information” to study the Lifetime Income Options for Retirement Plans and asked “for ideas on how to help reduce the chances that workers will run out of funds during their retirement years.” EBSA recommends government intervention “to enhance retirement security for employees,” so it is considering an alternative program that facilitates “access to, and use of, lifetime income or other arrangements designed to provide a lifetime stream of income after retirement. In other words, the government intends to convince Americans that the abrupt seizure of trillions of dollars in defined contribution retirement accounts in exchange for token government payments is for their own protection and benefit.”

Looking Forward

Balko offers the following rather ominous warning: “Don’t be surprised, then, if forfeiture power expands in the coming years, particularly with respect to financial fraud, tax evasion, and other white-collar crimes.“ And therein lies the problem – the likelihood that this practice of seizing private assets, which is theft by any rational definition, will continue to expand in volume and scope. Now that the Supreme Court has determined that imminent-domain-based theft of private property is not unconstitutional, it is difficult to see why the other forms of governmental theft listed here would not be perfectly constitutional as well. When one reflects on the scope of Government’s ability and growing propensity to seize whatever they want from private citizens to fund the existence of their own agencies, and in some cases enrich themselves in the process, it is difficult to see this as anything less than en eventual threat to the existence of the United States Government – or at least to the freedoms and rights to things like private property ownership that we are accustomed to in America. As long as all of the various levels of government within the United States are sufficiently corrupt, and willing to turn a blind eye as long as they get their piece of the pie, these practices will continue. Few – with the exception of a few brave journalists – appear to be willing to expose the widespread contagion of theft and corruption. Fewer still are willing to incur the expense and risk of retaliation to pursue these matters in court – especially when they understand the financial cost of doing so. And thus far no one at any level of US Government has been ethical enough and courageous enough to stand up for the American people in this regard.

The question that remains is simply: “How widespread and how egregious will the situation have to be in order to incite rioting and other forms of civil unrest? What will the breaking point be? Here is my speculation about that:

Let’s assume for a moment that Peter Raymond is correct, and that the nearly $8 trillion in private 401k and IRA accounts is simply too big a temptation. The US Government pretends to be so concerned about the inadequate income of retirees, and steps in to ensure that all of us get “what we have coming to us”, thereby justifying their actions in confiscating all of our retirement savings in order to dole out “what we need” on a monthly basis. Would the confiscation of all retirement funds by the US Federal Government result in a national outrage adequate to cause widespread civil disobedience and rebellion among the American people? Probably not. Would there be a lot of bluster, and outcry from the citizens of the United States to their local Representatives? You bet. But like Obamacare, it is likely that an adequate volume of smoke-and-mirrors like Nancy Pelosi’s infamous “We have to pass the bill before we will know what’s in it.”, and sheer payoffs to critical legislators (Louisiana Purchase and Cornhusker Kickback) that it would be come law anyway. Then someone would likely challenge it in court, but assuming that the same Supreme Court justices who ruled on Imminent Domain were in place reviewing the case, it is perfectly reasonable to assume that the confiscation of all private retirements accounts would be deemed constitutional as well. Of course, like Social Security, those of us who paid the most into the program will never live to see more than a fraction of it returned to us, because we are covering a much larger population of people who did not pay in over their lifetimes. It is merely another way to “spread the wealth” as President Obama told Joe the Plumber, and redistribute our income to others who did not earn it.

Now let’s assume that 10% (I picked this number absolutely out of the air) of all private homes and businesses are confiscated under “Imminent Domain” for some “higher and better use” (in the eyes of Government officials, of course.) These are homes and businesses in your community. You know there is nothing wrong with the structures, and that the only reason they are being condemned and purchased (or simply taken) against the will of their private owners is that the Government wants to do it – (Let’s say they want to put a new Home Depot, Best Buy, and Bed, Bath, & Beyond in to generate a higher tax base.) You see your friends and neighbors booted from their homes and businesses against their will. Would this incite you to participate in protests, and potentially threaten to overthrow the government entity involved? I doubt it. What if it was 20% of homes and businesses in your community? 40%? 75%? What if it was your home or business, and because the home has been in your family for generations, you don’t wish to see it destroyed for any amount of money? I’m thinking that most Americans will still cave in. Again, even if the Federal Government confiscates their homes with absolutely no compensation, it is my perception (I have no statistical evidence) that most Americans would do nothing but complain bitterly and start again somewhere else. (Notice that I said “most” here. There are parts of the country like Texas, Arizona, and Appalachia that I believe will not roll over so easily.)

Finally, as we saw in the article by KilKenny, in many cases the property (cash, automobiles, etc.) confiscated by government agencies – most often law enforcement agencies – is worth less than the legal costs of trying to get it back. So once again, most Americans whose property is confiscated without legitimate reason, simply shrug their shoulders, complain for a while, and do nothing. We are now at the point where this happens so frequently police departments build it into their annual operating budgets!

To summarize, then, I believe that the increasing adoption of confiscation of private assets by every level of government agency in the United States represents a significant and growing threat – a “clear and present danger” – to the American way of life. However, because of the willingness to tolerate abuse on the part of the vast majority of Americans, this cancer of corruption is not likely to threaten the continuity of the US Government in the foreseeable future. For that reason, I would rank its comparative position on that scale as “low” compared to other potential threats.

What do you think?

2 Responses to “Government Seizure of Private Assets: A Clear and Present Danger to America”

  1. sylvia frohning says:

    This is why Homeland Security and the IRS need so many rounds of holopoint ammunition lately; to suppress the american public’s outrage when they take our assets to pay for healthcare and everything else. We will surely respond with violence just like the people of Cypress.

  2. sylvia frohning says:

    Americans will most absolutely respond to the confiscation of assets with swift and violent rage. Why are they trying to take our guns? Why are the DHS and the IRS buy such large quantities of deadly holopoint ammunition? This administration waste no crisises to take away our rights

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