There are three different points here. I get zoning and that wasn't what I was discussing. You can lump in the commercial users with the residential because they are both effected in essentially the same way.
1. I don't disagree with you that people who CHOSE to move into an area do so at their own risk. On the other hand, I don't blame people who try to 'better' their communities either..so even if they do move in and try to push them out..I just don't feel sorry for them when they complain about losing money on their real estate either.
2. Now in regards to people who already live in an area where a strip club comes in...you can call this 'legal business' all you want, but it is no different than a garbage dump, salvage yard...it might be zoned for uses with those needs but it still kills the value of propety close by. And then you get into the cycle of poverty because that is the only property someone can afford and the area keeps degenerating.
3. Your perspective of people getting pushed out of neighborhoods is a valid one, very factual. BUT...'highest and best use' is how communities continue to improve tax revenue which goes to schools, keep people coming into a community through that growth. In your perspective, many, many, many communities would only regress into a depressed area if they didn't try to continue to improve. This is capitalism at its finest...and worst if you are pushed out.
Let me give an example...there is a tract of frontage road in a major city in DFW that is just after a major hospital. That hospital is doing a $100 million renovation. That renovation does MANY things...it attracts younger doctors, stabilizes the medical community and attracts more patients and fame. This tract of frontage is almost too narrow to put medical condo's, it's just dirt, but the tracts behind it, all of which are old, decrepid homes, rooves caving in, windows broken, etc. What is best for the 'community'? 1, keep it as is and about 5 houses at about 80k/ea will pay its 40k a year in taxes OR 2. Offer MORE than market value, where they can get better houses just a little outside this major area, build 5 Medical condo's at about $1m/ea and generating 500K a year in taxes?
I have seen people hold out on selling their property waiting for 10X the actual value, killing re-development projects (THAT WILL INCREASE TAX REV BY 1000%). Meanwhile they complain about not making enough money? And meanwhile, the offer for 2X or 3X the value of their home would allow them to buy a better-conditioned, newer home in a better neighborhood.
Capitalism and 'highest and best use' might not get all the warm and fuzzy feelings going but there are SIGNIFICANT long-term benefits to that concept.
On a side note...I think it was Chris Rock that talked about 'white' malls becomming minority malls once the white people move away. He was dead on and I am sure most of us have one of those type retail developments close to us. It's a cycle, not a nice one to discuss but it is reality. If we kept a closed mind about re-development and changing demographics, we would constantly get completely dead communities while the higher demographic moved completely out of town and taking their employing, spending and increased ability to hire services (which now dominates our economy) with them.