A very interesting article. I am not a lawyer, but I am interested in Constitutional law to the extent that I want to understand what the Constitution says about the limits of federal power and what that implies for the state governments. For anyone with a similar interest, I recommend reading Stephan Kinsella's essay that Tibor provides the link to near the beginning of his article. It is rather long and it took considerable effort on my part to plow through it, but it was worth the effort.
Kinsella's main point is, I think, that the Supreme Court does not have jurisdiction in the Kelo case. The Court assumes jurisdiction (in this case and others) based on its interpretation of the 'privileges and immunities' clause of the fourteenth amendment (section 1). Kinsella invites you to read the amendment yourself. If you think the meaning of 'privileges and immunities' is not clear, you're not alone. A lot of legal scholars would agree. And it's that ambiguity of interpretation that, over a long period of time, allowed the expansion of the assumed authority of the Supreme Court to rule on the validity of state laws.
Kinsella thinks that the Court made the right decision, but for the wrong reasons, and preferably should not have even considered the case. (My apologies to Mr. Kinsella if I have mischaracterized his ideas in my explanation. I am over my head in this legal stuff.)
This situation is similar to the legal debate about Roe v. Wade. Whatever your opinion about abortion, many critics assert that the Supreme Court should not have considered the case, since abortion is not mentioned in the Constitution and should be strictly a matter of state law.
All this is part of an old debate about what federalism is, or should be. Tibor seems to think that the best approach is to consider all the past expansion of federal power as established, as water under the bridge, and now, as he says, "...if the Courts can function as bulwarks against such violations [of individual rights by all levels of government], I say go for it. We need all the help we can get and no arcane technicality of what is by now pretty effectively obsolete constitutional law should stand in our way." Regrettably, he may be right. I guess I'm still hopeful that another case will come before the Court where a competent lawyer, who values individual rights, can make effective arguments about fundamental constitutional issues that serve to limit or even lessen the power of the federal government and even of the Court itself. Hope springs eternal.