By Per L. Bylund
Oklahoma State University
There’s been a lot of buzz lately about boosting private property protections in Oklahoma by amending the state’s civil asset forfeiture laws.
Indeed, the current law, which allows law enforcement to seize cash or property from anyone simply deemed suspicious — without even a trial — is a gross violation of individual rights guaranteed by the U.S. Constitution and should be amended on that principle alone.
But, there is another harm that deserves attention: the negative impact civil asset forfeiture abuse has on our economy, specifically, entrepreneurship and small business growth.
As a professor of free enterprise at Oklahoma State University and someone who studies entrepreneurship and conditions that allow businesses to flourish, I believe it is important to point out the toxic effect loose civil asset forfeiture laws can have on an economy. Namely, by eroding stability and predictability.
Both stability and predictability are essential in creating a fertile environment for entrepreneurship to take root and for businesses to thrive.
Predictable laws and consistent regulations allow businesses to anticipate and plan for the future and make sound business decisions like hiring, growing their businesses and investing in research and development. The arbitrary nature of Oklahoma’s — and many other states’— asset forfeiture laws undermines these essential characteristics.
Imagine that you own a convenience store in a troubled neighborhood. You are already at a disadvantage with the high costs of protection and insurance premiums that come with the neighborhood’s higher crime rates. And, with higher crime rates come also a higher risk for being suspected of a crime, whether or not the suspicion is well grounded.
According to the current law, a mere suspicion of wrongdoing is enough for the authorities to seize the cash, inventory and property of your legitimate business — as well as your belongings at home. They don’t need to charge you with committing a crime. And if your property is seized, you need to prove your innocence to get it back. This is clearly contrary to the U.S.’ “innocent until proven guilty” tradition.
Horridly, this is not a hypothetical case: in a recent report, Oklahoma Watch finds that nearly two-thirds of cash seizures are from racial and ethnic minorities. And we’re not talking about petty cash: the Institute for Justice finds in its report, “Policing for Profit,” that Oklahoma law enforcement forfeited nearly $99 million from 2000 to 2014. With this risk of civil asset forfeiture added to the burden of entrepreneurship, would you open shop and contribute to the community in this neighborhood?
For most people, the answer is no. Oklahoma’s civil asset forfeiture law thereby contributes to keeping poor neighborhoods poor.
There is plenty of research to back up this claim. Indeed, a major reason poor countries remain poor is that they don’t have neutral, dependable institutions and reliable protection of private property.
The same argument applies for rich countries, and especially less well off areas in those countries. The use of arbitrary civil asset forfeiture shows this: The law itself, and especially its arbitrary enforcement, is a penalty on entrepreneurship in communities where there is already a widespread lack of trust in the authorities. It keeps troubled neighborhoods from flourishing.
The sorry state of our civil asset forfeiture laws have earned Oklahoma a D- in the report, “Policing for Profit.” In our state, the standard of proof necessary for seizure is very low, and authorities get to keep up to 100 percent of the value of what they seize.
This means there is plenty of room for improvement. Any step in the direction toward strengthening stable rule of law and a personal property rights protections would be a boon for Oklahoma’s economic growth potential. And most importantly for neighborhoods in most desperate need of businesses and the jobs they create.
Per L. Bylund, Ph.D, is the Records-Johnston Professor of Free Enterprise and assistant professor, School of Entrepreneurship, Oklahoma State University.
