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The concept of blight traces its origins back to the urban planning movement of the early 20th century. Urban planning advocates argued that government could successfully restructure and improve neighborhoods afflicted by crime, disease, and dilapidation.

In the 1930s, many states began to enact statutes and Constitutional amendments giving local government agencies the power to condemn blighted areas and transfer them to private firms for redevelopment. Previously, the validity of such takings was in doubt because federal and state constitutions allowed the use of eminent domain only for a “public use.” Many courts and legal commentators interpreted that term to require either public ownership of the condemned property or at least a legal right of access by the general public (as in the case of public utilities).

During the Great Depression, elite opinion turned sharply against property rights. More and more court decisions adopted a broad interpretation of public use that allowed condemnations for any purpose that might potentially benefit the public in some way, even if the new owners were private parties. In Berman v. Parker, a landmark 1954 decision, the federal Supreme Court adopted this broad interpretation to the Public Use Clause of the Fifth Amendment and upheld the constitutionality of blight condemnations. Berman approved the condemnation of a nonblighted property in a seriously blighted neighborhood in Washington, D.C., as part of a broader development project that involved the forcible relocation of some 5,000 people, most of them low-income African Americans. The Court's unanimous opinion praised urban planning and emphasized the need for judges to defer to planners’ expertise.

Berman was widely imitated by state courts interpreting the public use clauses of their state constitutions. By the mid-1960s, virtually every state allowed blight condemnations. As a result, the post–World War II era saw an explosion of blight and urban renewal takings that displaced hundreds of thousands of people, most of them poor ethnic minorities. These takings often targeted African Americans, to the point where critics such as African American writer James Baldwin asserted that urban renewal was really removal of Blacks from neighborhoods.

During the 1960s, blight condemnations began to be a focus of great controversy. “New urbanism” advocate Jane Jacobs claimed that they destroyed organic communities and replaced them with poorly designed plans that took little account of local needs. Economists such as Martin Anderson argued that blight condemnations destroyed more economic value than they created and left the residents of poor neighborhoods worse off than before by displacing them to less desirable locations. Many African Americans believed that they unjustly targeted ethnic minorities. Defenders such as the famed urban planner Robert Moses argued that blight condemnations were needed to revitalize depressed neighborhoods. They especially emphasized the supposed superiority of land use planning by experts over the vagaries of the market.

Originally, the definition of blight was limited by legislation and court decisions to severely deteriorated “slum” areas. By the 1960s and 1970s, however, many states enacted much broader definitions that could apply to almost any area. In recent years, courts have ruled that such unlikely areas as Times Square in New York City and downtown Las Vegas are blighted. As a result, perfectly intact areas have been condemned for transfer to politically influential private developers on the grounds that such a transfer might increase economic development or eliminate relatively minor structural defects.

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