Private Property: The Indispensable Key to Political Freedom, Social Cooperation, and Economic Progress

Commentary Imagine a society with no property rights: No law or officer of the law would prohibit you or punish you for taking whatever you want from whomever you want. Such a society would be chaotic, hostile, and poor. In such a dog-eat-dog scenario, all but the most powerful and their allies would have little more than what they could carry with them or what they could successfully hide. They could try to hide things in a house, but without property rights, marauders would break in and take whatever they can find. In fact, the marauders might even take possession of the house itself if they have numbers and weaponry sufficient to expel the previous occupants. Even then, they wouldn’t be secure. Either a mightier or more ruthless character might come along and seize the dwelling, or some sore loser resentful of having been displaced from the house might decide to practice a little arson in the middle of the night to gain vengeance against those who had taken from him. Even whatever meager possessions one could manage to carry on one’s daily rounds would be vulnerable to plunder by a stronger individual. Perhaps many people in this hellish scenario would carry weapons with which to try to defend themselves, but even then, one lapse of alertness or simply being outnumbered and/or out-armed could see those precious things taken away. Life is far different where property rights are established and respected by a large majority of a populace. Individuals gain dignity. Civilization often flourishes. Economically, property rights confer security on property owners. Indeed, the primary right of life is only secure if there are laws protecting the possessions that sustain and bring enjoyment to one’s life. A human being is less than free to the degree that his or her property rights are abridged. Wealth can accumulate where private property is secure; it’s dissipated where property is insecure. Socially, because nobody is permitted to take the property of another, individuals obtain additional goods and services via voluntary exchanges with other property owners—positive-sum transactions that are freely made by both parties. This is the basis of the division of labor—the foundational reality of peaceful cooperation between individuals that renders life social, not antisocial; civilized, not savage. Politically, the masses of people reach the full realization of freedom when they dwell in a polity where property rights are sacrosanct. A person’s home is his or her castle, protected by invisible moats, drawbridges, and armed guards. These unseen defenders are the laws that uphold the right of the individual to earn, keep, and accumulate property peacefully. People are free to the extent that government upholds their rights of life, liberty, and property; they are unfree to the extent that governments encroach upon those rights. Today, the United States is graded “mostly free” on the Heritage Foundation’s annual scorecard, the 2021 Index of Economic Freedom—ranking 20th in the world. We have a mixed economy—partly free market, partly government-controlled. Many Americans have indicated that they favor socialism (less private property, more government control). A minority (including yours truly) is urging a return to our national roots—private property and limited government as the only way to preserve freedom and increase general prosperity. An Unviable Option Anyone conversant with history knows that socialism, with its inherent disbelief in private property rights, is not a viable option. To cite only the most famous of the dozens of examples of failed socialist experiments, the history of the former Soviet Union demonstrates definitively socialism’s defects. Vladimir Lenin himself acknowledged the unviability of pure socialism when he adopted his New Economic Policy in 1921. In the two previous years, the communist government’s control of all industries led to starvation and the economic prostration of the country. Retaining control over major industries (“the commanding heights” of the economy), he allowed some private production and profit-making. These reforms, these practical concessions to market economics, led to a modest economic revival (only to have Stalin, who succeeded Lenin when the latter died in 1924, persecute and liquidate the entrepreneurs who saved the country). According to a friend of mine who was an economist working for the last Soviet leader, Mikhail Gorbachev, by the time the USSR dissolved in 1991, approximately two-thirds of what Soviet citizens consumed was produced in black markets—officially illegal, but winked at by the Communist Party because that was the only way to prop up the decrepit and corrupt system. Indeed, more food was grown on the tiny private gardens that Soviet farmworkers were allowed to cultivate than on the vast collective farms. (In driving through some former Soviet satellite countries in 2005, I saw miles of idle land littered with abandoned farm equipme

Private Property: The Indispensable Key to Political Freedom, Social Cooperation, and Economic Progress

Commentary

Imagine a society with no property rights: No law or officer of the law would prohibit you or punish you for taking whatever you want from whomever you want. Such a society would be chaotic, hostile, and poor.

In such a dog-eat-dog scenario, all but the most powerful and their allies would have little more than what they could carry with them or what they could successfully hide. They could try to hide things in a house, but without property rights, marauders would break in and take whatever they can find. In fact, the marauders might even take possession of the house itself if they have numbers and weaponry sufficient to expel the previous occupants. Even then, they wouldn’t be secure. Either a mightier or more ruthless character might come along and seize the dwelling, or some sore loser resentful of having been displaced from the house might decide to practice a little arson in the middle of the night to gain vengeance against those who had taken from him.

Even whatever meager possessions one could manage to carry on one’s daily rounds would be vulnerable to plunder by a stronger individual. Perhaps many people in this hellish scenario would carry weapons with which to try to defend themselves, but even then, one lapse of alertness or simply being outnumbered and/or out-armed could see those precious things taken away.

Life is far different where property rights are established and respected by a large majority of a populace. Individuals gain dignity. Civilization often flourishes.

Economically, property rights confer security on property owners. Indeed, the primary right of life is only secure if there are laws protecting the possessions that sustain and bring enjoyment to one’s life. A human being is less than free to the degree that his or her property rights are abridged. Wealth can accumulate where private property is secure; it’s dissipated where property is insecure.

Socially, because nobody is permitted to take the property of another, individuals obtain additional goods and services via voluntary exchanges with other property owners—positive-sum transactions that are freely made by both parties. This is the basis of the division of labor—the foundational reality of peaceful cooperation between individuals that renders life social, not antisocial; civilized, not savage.

Politically, the masses of people reach the full realization of freedom when they dwell in a polity where property rights are sacrosanct. A person’s home is his or her castle, protected by invisible moats, drawbridges, and armed guards. These unseen defenders are the laws that uphold the right of the individual to earn, keep, and accumulate property peacefully. People are free to the extent that government upholds their rights of life, liberty, and property; they are unfree to the extent that governments encroach upon those rights.

Today, the United States is graded “mostly free” on the Heritage Foundation’s annual scorecard, the 2021 Index of Economic Freedom—ranking 20th in the world. We have a mixed economy—partly free market, partly government-controlled. Many Americans have indicated that they favor socialism (less private property, more government control). A minority (including yours truly) is urging a return to our national roots—private property and limited government as the only way to preserve freedom and increase general prosperity.

An Unviable Option

Anyone conversant with history knows that socialism, with its inherent disbelief in private property rights, is not a viable option. To cite only the most famous of the dozens of examples of failed socialist experiments, the history of the former Soviet Union demonstrates definitively socialism’s defects. Vladimir Lenin himself acknowledged the unviability of pure socialism when he adopted his New Economic Policy in 1921. In the two previous years, the communist government’s control of all industries led to starvation and the economic prostration of the country. Retaining control over major industries (“the commanding heights” of the economy), he allowed some private production and profit-making. These reforms, these practical concessions to market economics, led to a modest economic revival (only to have Stalin, who succeeded Lenin when the latter died in 1924, persecute and liquidate the entrepreneurs who saved the country).

According to a friend of mine who was an economist working for the last Soviet leader, Mikhail Gorbachev, by the time the USSR dissolved in 1991, approximately two-thirds of what Soviet citizens consumed was produced in black markets—officially illegal, but winked at by the Communist Party because that was the only way to prop up the decrepit and corrupt system. Indeed, more food was grown on the tiny private gardens that Soviet farmworkers were allowed to cultivate than on the vast collective farms. (In driving through some former Soviet satellite countries in 2005, I saw miles of idle land littered with abandoned farm equipment—the graveyards of collective farms. It was grim and haunting.)

The United States, in contrast to the Soviet Union, rejected the notion of collective ownership and government control of peaceful economic production from Day One of our republic. Instead, the Founders instituted a system that Marx pejoratively labeled “capitalism,” but which more accurately can be described as “the private property order.” The way for American businesses to profit and grow rich was to excel in the competition of offering what their fellow citizens wanted (or, in economic lingo, to produce what consumers demanded). By contrast, under socialism, business establishments produce what government dictates. What the people want is largely ignored, which helps to explain why those who have lived under socialism decry the poverty they endured.

A Cherished Principle

Some say that the ideological foundation for the private property order envisioned in the Declaration of Independence and established via the U.S. Constitution was laid on the ideas of English philosopher John Locke—especially his “Second Treatise of Government” (1690) in which he extolled the rights of life, liberty, and property. I recall reading some research decades ago that found that while Locke, English jurist William Blackstone, and French man of letters Montesquieu were cited in various editorials and sermons during the Founding Era (between 3 and 8 percent of the total by one count), by far the most commonly cited source was the Bible. With all due respect to Locke, what is the right of life but a restatement of the venerable principle “thou shalt not kill”? What is the right to property but another way of saying, ‘Thou shalt not steal”? The Deity acknowledged by the world’s monotheists framed these great principles many centuries before Locke. It was in the Christian soil of American culture, dating from the landing at Plymouth Rock up to the modern era, that did more than any secular philosophy to inculcate the ethos of private property in American hearts.

As expressed in the Declaration of Independence, the Founding Fathers believed that the sole legitimate function of the federal government was to defend, uphold, and enforce our natural (i.e., God-given) rights to life, liberty, and property. The few powers of the federal government as enumerated in Article I of the Constitution were designed to “promote the general welfare” impartially, and not to favor any special interests. That kept government small—so small in fact, that its total expenditures for the 60-year period from Day One in 1789 through 1849 was less than $1.1 billion. (By comparison, it currently takes Uncle Sam less than an hour-and-a-half to spend that much.) The notion of the federal government levying taxes on some citizens to confer benefits on others was inconceivable to them, for such policies would trample justice, emasculate property rights, and undermine liberty. That was the predominant American attitude toward property for the better part of the republic’s first two centuries.

Here are a couple of illustrations of how deeply Americans have cherished the principle of private property even generations after the Founding Era: Growing up in the 1950s and ’60s in a city of approximately 90,000 people on the outskirts of Detroit, it never occurred to us to lock our cars or houses. Maybe we locked the house if we were going to be on vacation for over a week, but that was about it. And when things got a little heated as we fellows horsed around, if one angry boy started chasing another to give him a punch or put him in a headlock, the boy being chased only had to make it back to his front yard and say, “Halt, this is private property!” That was our trump card, and as corny as it may sound today, it worked: The kid doing the chasing stopped dead in his tracks. Nobody in our neighborhood was going to embarrass himself by disrespecting the sanctity of private property.

However, even as we kids still adhered to the traditional American value of respect for private property, the adult world was whittling away at that principle. It started with the progressive notion that government should redistribute wealth in the name of social justice (what Frederic Bastiat brilliantly described as “legal plunder” in his immortal essay “The Law”). Both the U.S. Constitution and The Bill of Rights, and the American experiment that they undergirded, have been undergoing increasingly aggressive assault from those upset that the United States isn’t perfect.

Rights and Responsibilities

There has been growing confusion about two concepts that must be correctly understood if freedom and prosperity are to endure: rights and responsibilities.

In our private property order, nobody has a right to steal from others to meet his own needs or wants. Since all humans have needs (food, clothing, shelter, etc.), how are they to meet those needs in a private property order? Each adult has the responsibility to find work somewhere in the social division of labor to earn money to purchase life’s necessities. The conceptual and ethical problem with government redistribution of wealth (property) is that those who have met their responsibilities to provide for themselves by being self-supporting, and thus not a burden upon others, are taxed to give money to those who did not discharge that same responsibility.

To be clear, those of us who have prospered do have a responsibility to help those in need, but it’s a moral responsibility, inculcated in most of us by our religious teachings. Charity is not and should not be a legal obligation (at least, at the national level), for that violates the very raison d’être of the government in Washington.

The private property order established by America’s founding generation is superior to the socialist alternative both for practical, utilitarian reasons (e.g., greater prosperity, more liberty) and for retaining a moral clarity that’s lost when property rights are considered negotiable rather than absolute. The Founders got it right. Now it’s our turn. The current generation of Americans needs to get it right on this pivotal issue.

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.


Mark Hendrickson

contributor

Mark Hendrickson is an economist, who retired from the faculty of Grove City College in Pennsylvania where he remains fellow for economic and social policy at the Institute for Faith and Freedom. He is the author of several books on topics as varied as American economic history, anonymous characters in the Bible, the wealth inequality issue, and climate change, among others.