To judge from the disparaging reaction to its plan to use eminent domain to cope with underwater homes, you'd think the city leaders of Richmond, California, had proposed an outrageous and unprecedented distortion of state power.
Filing suit against Richmond, BlackRock Inc., Pacific Investment Management Co. and other plaintiffs alleged that the city's proposal amounts to an "unconstitutional application of eminent domain" and a "brazen scheme." The Federal Housing Finance Agency announced that it was considering ceasing to do business in municipalities that pursue this course. Media coverage generally echoed the plaintiffs' take. USA Today's headline summed up the conventional wisdom, declaring that Richmond "runs amok with eminent domain."