Notes on Property: Phil Osborn 06/15/2013
(Originally presented at the Santa Ana Escualita.)
Note: this is hardly exhaustive of the subject, but I’m hoping it will provoke an ongoing discussion and some good ideas and understandings of the key elements of the various issues.
What this covers:
- A fairly detailed overview of property history and theory focusing mainly on “land” property
- A number of key examples of differing implementations of property as a cultural construct
- A set of issues around property that are the subject of much contention and that need resolution
- The potential social/moral/economic implications of a possible new approach to property
- Intellectual property issues introduced
What is Property?
The Wiki in this respect is not entirely helpful, defining “property” in terms of “ownership...” Then the Wiki on “ownership” - you guessed it... So, let’s start with a generic for “ownership,” which means “the right to use and disposal.”
Functionally, the distinction between what is termed “property” and non-property rests on use-authority. Non-property is free for use by anyone for any purpose, while the “owner” of property can restrict others from either particular or general access. A theater owner, for example, can restrict attendance to only those who are willing to participate quietly, while a farmer or a high-tech manufacturer might put up “no-trespassing” signs, on the grounds that any uninvited persons would threaten the value invested in the property, at minimum diverting attention and precious time from the tasks at hand. The King might allow passage through his forest, but not allow hunting. And, a collective, such as a tribe, can set rules for its property held in common. In general, saying that something is your property – that you “own” it - is equivalent to saying that you may legally and/or morally/ethically prohibit other people from using it or interfering with your use of it, so long as your use of it does not violate the terms of your title or lease.
Theories of property differ in respect to how something becomes property, what kinds of things can legitimately become property, how property relates to legal authority, how property rights are enforced, where the limits and exceptions to exclusive use are drawn, how property is transferred, who can actually own property, and many similar issues that reflect issues in more general philosophy that date back to the earliest examples known of systematic philosophical inquiry.
From the Wiki on “ownership”: “The question of ownership reaches back to the ancient philosophers, Plato and Aristotle, who held different opinions on the subject. Plato (428/427 BC – 348/347 BC) thought private property created divisive inequalities, while Aristotle (384 BC – 322 BC) thought private property enabled people to receive the full benefit of their labor. Private property can circumvent what is now referred to as the “tragedy of the commons” problem, where people tend to degrade common property more than they do private property. Given a short-sighted owner, however, a private property system can make these tragedies worse—for example, a private owner of a piece of oil-rich property, depending on his worldview, might be more interested in short-term financial gain than incremental use with an eye toward other's concerns (e.g., those of future generations, the disenfranchised, etc.). While Aristotle justified the existence of private ownership, he left open questions of (1) how to allocate property between what is private and common and (2) how to allocate the private property within society. “
Encompassing more modern thinking, from the wiki on ownership: “Property is theft! is a slogan coined by French anarchist Pierre-Joseph Proudhon in his 1840 book “What is Property? Or, an Inquiry into the Principle of Right and of Government.”
But the primary source for the concept of property most widely given lip-service at least is of course John Locke. The explicit target of Locke's inquiry was the “Divine Right of Kings,” which held that the source of property rights was the authority of God, Who owned everything (by virtue of having created everything, one assumes), and by extension, his alleged servants and representatives, as in the Papacy and the secular authorities, such as Kings, who derived their “rightful” authority from explicit allegiance to the Church. Locke, then is perhaps properly seen as a primary driving figure of the enlightenment, which itself reflected a general rejection of arbitrary authority and the belief that the universe was knowable to anyone willing to exert the effort, not some tiny ruling class of philosopher kings anointed by God. Locke was the five-star admiral in an intellectual war that started two millennia prior between Aristotle and Plato.
John Locke FRS (/ˈlɒk/; 29 August 1632 – 28 October 1704), widely known as the Father of Classical Liberalism, was an English philosopher and physician regarded as one of the most influential of Enlightenment thinkers. Considered one of the first of the British empiricists, following the tradition of Francis Bacon, he is equally important to social contract theory. His work had a great impact upon the development of epistemology and political philosophy. His writings influenced Voltaire and Rousseau, many Scottish Enlightenment thinkers, as well as the American revolutionaries. His contributions to classical republicanism and liberal theory are reflected in the United States Declaration of Independence.
Again from the Wiki on Locke: “Such was Locke's influence that Thomas Jefferson wrote: "Bacon, Locke and Newton... I consider them as the three greatest men that have ever lived, without any exception, and as having laid the foundation of those superstructures which have been raised in the Physical and Moral sciences"
Locke's position on property was a direct challenge to the main authorities of his time, setting that portion of moral/legal philosophy squarely in the Aristotelian tradition of objectivity. Property was not something, in Locke's view, that kings arbitrarily handed out to buy power, as had been the case for a thousand years prior under serfdom, but rather, properly reflected an investment of labor, an objective fact. (On related grounds, Locke saw the state’s justification for existence purely on the basis of objective necessity, as a guardian of the peace. Beyond that function, he saw the state becoming all too easily a self-sustaining authority generator, more of a threat to its own subjects than the criminals and other hostile states could ever be.)
Paraphrasing Locke: It is objectively verifiable by anyone that no man can legitimately abrogate his personal authority and responsibility over his self, his actions and thoughts, if for no other reason than he would first have to choose which external authority to accept, and then, of course, he could change his mind. Each man thus has the unique obligation and the necessary corresponding authority and responsibility to determine his thoughts and actions. As a starting point for property, then, each man can be said to own his own life,* and, by extension, the actions necessary to sustain that life. These actions are not inherently restricted to the range of the moment but may extend for long periods of time, such as the actions necessary to run a farm and produce crops. This, according to Locke, created a natural property claim. You own your life. Therefore you own your actions. Therefore you own the means necessary to fulfill the purpose of those actions.
Locke is famous for his declaration that the origin of original property is the mixing of one's labor with the land. This was a profoundly revolutionary position at the time, and led directly to the founding of the U.S., as well as the overthrow of the various European monarchies in ensuing generations.
*To own something, recall, is to have the moral authority to forbid interference in ones use and disposal of that thing. For someone else to claim a “right” to one's life or authority over one's actions would constitute a fundamental injustice in Locke’s take.
Unfortunately, as I hope to demonstrate, Locke has been largely misquoted and taken as the patron saint of individuals and groups who are fundamentally at odds with what he actually said. A parallel problem has arisen regarding the so-called Father of Capitalism, Adam Smith, who adamantly opposed the corporation as such, completely rejecting its legitimacy and yet is taken as virtual patron saint by those very corporatists today, who of course have a vested interest in conflating their child of the state with actual free market entities.
The bastardized version of property that is in common usage worldwide is responsible for a situation directly analogous to the “Divine Right of Kings” era, in which privileged** elites claim property, not for legitimate use, but strictly for the purpose of expanding wealth and power at the expense of everyone else. Meanwhile, legitimate claims for compensation to the Commons are ignored, and we see widespread impoverishment and starvation parallel to an increasingly polarized division of Haves vs. Have Nots. This concentration of power and wealth is justified on the basis of a phony version of Locke’s position that Locke himself would have rejected out of hand.
Under this commonly accepted version of property, which owes its original derivation to the bastardized version of the Common Law that the Norman conquerors imposed upon England, property is an absolute that only individuals may own. Collective or tribal ownership is simply seen as illegitimate. It was this rationale that was a central justification for the wholesale seizure of tribal lands in North America, Africa and elsewhere by the British Empire. (The other main early European colonizers – e.g., France, Spain, Belgium, and Portugal - were monarchies still relying upon the “Divine Right of Kings” – but with similar results.)
**”Privilege” means literally “private law,” from the Latin.
On Locke and collective property:
The Libertarian Standard Model:
The Libertarian Standard Model, as exemplified in the writings of such luminaries as Rand and Rothbard is that property follows directly from a Lockean mixing of labor with land or other physical or intellectual things. Sadly, crucial issues that are left out of the formula include, among others:
How much labor is required, and of what kind?
If any amount is sufficient to justify a property claim, then don’t we all have claims on the entire planet, since we all mix our labor with the Earth’s gravitational field? Or to the Sun, as we also depend and mix our labor with its heat, light, resultant photosynthesis, etc.?
And, in fact, we DO all have property claims to the Earth and to the Sun, or, for that matter, probably the entire universe, under the Law of the Commons. If so, even if we restrict it solely to the Earth itself, that implies that there is no unmixed/unclaimed property available. And if there is no unclaimed property to mix with, then trying to use Locke’s position is useless, if we assume that he meant it to be the legitimate legal path to acquire property as such.
But Locke relied upon there being a legal system that would somehow adjudicate what was real, legit property and be prepared to resolve conflicting property claims, setting standards independent of mixing ones labor. I.e., Locke never intended the “mixing” argument to be anything but a moral justification for the existence of property, not a practical prescription for how to acquire it. For Locke, property was a natural derivation of human rights, which was in turn a derivation of the implied Social Contract – in a nutshell, that we agree to treat each other as inherently valuable and not as prey. See my piece “On Morals,” subject of a presentation at the Orange County Humanist Association.
The real Lockean position on collective/tribal land rights:
Evolution of property:
Property was originally limited to what a member of a foraging group could easily carry. Even then, that personal property would generally be shared, as one person might be lucky one day, and less lucky the next. Sharing was the rule - within the group – typically with severe consequences if someone was caught hording necessities such as food. In that context to privatize was to violate the social contract - claiming special privilege, treating other people as less valuable, taking but not reciprocating.
However, with the rise of animal husbandry, trapping and/or agriculture came both the need for a fixed location and also for a continuity of effort. Those needs combined in the evolution of private property as well as a society characterized by hierarchy and command. The need for the farmer, for example, to prevent others from reaping the results of his efforts, including the seeding of the next crop, required an enforceable social sanction, effectively requiring something on the order of a recognized title backed by legal authority, although in practice this often consisted of an informal verbal agreement within the tribe.
There is a myth about native cultures that is often voiced in objections to recognizing their property claims, to wit that all native property was collective and thus invalid. A good example of how far wrong this myth goes is seen in the social/economic role of property in trapping cultures, such as the large Ojibwe, Ojibwa, or Chippawa (also known by several other names) native North American tribes who inhabited a vast area centered around the Great Lakes and northwards. They relied upon trapping for sustenance in an extremely harsh climate – at least for over half the year. It required about seven square miles to sustain a single nuclear family. If two families attempted to live together, it simply didn’t work, as the distances to the traps became proportionately larger. Even under those restrictions, death from starvation was common and there was a mythical starvation monster that was a familiar component of nightmares. Any incursion or predation by desperate neighbors could mean painful death for the family. Thus arose the Ojibwa concept of land property. Any family could own absolutely one or two parcels of trapping land up to around seven square miles in extent. No one else was allowed to camp permanently or set traps on that land, although anyone could cross it and eat what they killed during passage.
The Ojibwa property concept was perfectly adapted to the culture and the physical challenges of the environment and available technology. ALL property was individual. “The husband caught his game and brought his meat to his house, where his wife cooked her meat and gave her meat in portions to her husband and the children. Then the husband ate his meat and the wife ate her meat and each child ate his or her meat.” I.e., there was not even a way to express the concept of joint property.
This did not reflect some kind of intellectual impoverishment, however, as the Ojibwa had a booming trade in intellectual property itself. Dreams were considered magical and could be bought and sold along with other magical spells, prophecies, songs and dances, etc. And, land property was based on use. It was recognized that a family might need to leave a tract of land fallow for up to seven years for the game to recover from over-trapping. Any longer, however, and someone else could move in and stake a claim.
Property in one form or another is ubiquitous. In two of the cultures studied for Margaret Meade’s classic “Sex and Temperament in Three Primitive Societies” property takes an interesting and different tack. One culture located on the seacoast frequently guested sea traders who, along with the physical trade goods one would expect, carried the data in their heads necessary to reconstruct dances and plays. They would train and put on a dance or play and be paid in real trade goods. The coastal tribe would then resell the dances and plays to tribes further inland, who would then resell further inland, etc. Making the transaction a trade created a vested interest in maintaining the quality of the experience. Otherwise, no one would trade for it.
Meanwhile, yet another tribe had a social edict that no one was allowed to benefit directly from his or her own production. If you caught a fish, you had to give it to someone else. However, the recipient was not random. It would generally be someone with whom one had a particular kinship relationship. Thus, even though personal property in the usual sense was barred, property in kinship relationships came to dominate. It became essential to have good relationships - and lots of them - to ensure that one got the necessities of life, much less luxuries.
(Note: a recent “New York Times” article detailed the title problems in Greece, where land titles have often been poorly documented, with the result that ten different neighbors may lay claim to the same land. The result, similar to the situation in much of South America until recently, was that no one could plan any usage of the land, which lay idle, often populated with abandoned wrecks of buildings that no one was willing to fix or occupy, due to the uncertainty. And, of course, no loans were available on the land as collateral, with the titles in dispute. Greece is apparently a worst case example in Europe, where most nations have clear, documented titles for most of the land. According to the article, Greece had about twice as much claimed property as physically exists, the implication of the article being that this was one of the roots of the economic collapse there.
On a much larger scale, however, we have the land property issues of China, which does not recognize legal individual land ownership. Consequently, the various local authorities have been cutting deals right and left with “developers” to build all manner of high-rise complexes and factories, which are often of extremely poor quality, unsafe, usually cannot find tenants, and within a year will start collapsing. The money is going into the pockets of the authorities and “developers,” while the original inhabitants find themselves ousted and their homes, villages and shops bulldozed.
In many cases, people have resisted. Rather than have their names attached to such seizures by bringing in the local cops, the authorities or “developers” send in private goons – similar to the Pinkerton guards that broke up strikes in the early 20th Century – who terrorize or kill the protestors, invading their homes or shops, beating up whoever stands up to them. In a few cases, however, the people have won and the authorities have backed down when faced with mass resistance and publicity. There are probably a lot more such cases than are reported in the highly controlled Chinese media or internet.
Biblical (Torah) examples: Storing grain against lean years in communal bins. Collective bargaining to force buyers of farm produce to pay reasonable compensation. Primacy of contract: sale of birthright.
Tigris/Euphrates, Mesopotamia example: From MacCallum's “The Art of Community.” Breakdown of role and ritual as a function of conquest and subjugation, leading to conceptualization of abstract principles such as rights.
See also Julian Janes: http://www.julianjaynes.org/julian-jaynes-theory-overview.php
Purposes of Property:
Proprietorship: (See MacCallum) Having Property means reaping the rewards as well as accepting the responsibility. If you plant a crop on your farm, then you rightfully own the harvest, if it comes. You take the risk of failure, and that risk plus the potential foreseen rewards are the incentive to take every measure to ensure a successful harvest. From the standpoint of the collective, the burden of assuming risks that can only be countered with personal expertise is lifted or reduced when property is controlled by an individual or subgroup as opposed to the entire collective. Under a typical commons property contract, the collective benefits from the successes of the individual or collective owners in the form of either fees up front, which in the long term depend upon the owner's success, or a percentage of the crop or other produce.
Starting at the bottom: Roomies / Desert island: property claims arise out of different needs and values. While can be handled on a personal basis in a small group, requires a procedure and a standard for larger groups and longer time frames.
Hunter-gatherers: For Neolithic tribal groups up to about 200, everything is typically shared more or less equally. Children are raised communally and fatherhood is unknown. Every male treats the kids as his own.
Pastoral, trapping and Agricultural groups: Long term claims to grazing/trapping/farming lands leads to hierarchy, usually a patriarchy. Children are raised by father and mother and patrilineage is essential. Property is derived as a function of authority and position in the hierarchy.
Commons based societies, such as Anglo-Saxon England: All property in the commons is assumed to be owned equally to begin with, with access and use governed by explicit local rules aimed at reducing conflict and preventing the "Tragedy of the Commons." Under that model, private property such as land dedicated to farming is acquired by permission of the commons, typically in exchange for valuable considerations such as a percentage of the crops and for a set period of time. Such private property exists by the grace of the commons and that permission may be withdrawn under the terms of the contract, such as for emergencies or eminent domain, typically with compensation. A similar system existed under serfdom, the main difference being that the serfs were a completely separate class. The serfs and nobles had particular authorities, rights, privileges and obligations, and methods of resolving issues that arose. See below – Property and the Common Law.
Divine Right of Kings: God is the ultimate landlord. Kings derive their legitimacy from allegiance to God, in practice the Church. The Church grants the King the power to regulate property usage within his realm. The Church, meanwhile, has its own properties, at one time quite vast.
Lockean property as a right derived from labor: Under Locke's analysis, since each individual has a right to his or her own life, this implies that he or she had a right to the actions necessary to sustain that life, namely productive labor. Since range of the moment freedom of action is by itself insufficient to sustain human life, which requires long-term planning and actions whose consequences may not be experienced for months or years, then there needs be a philosophically grounded mechanism by which those long-term actions can proceed unimpeded by interference by other people. I.e., to remove something from the universal claim of the commons would seem up front to constitute an injustice, creating a privilege that requires a moral justification.
This mechanism is property, which has as its basis a "mixing of labor with the land," meaning that employing unclaimed or unowned land in a series of actions, such as weeding, planting seeds, tilling the ground, protecting from predators, etc., naturally implies a right to non-interference and a moral claim on the proceeds of such investment of one's time and effort. (Note: Rand reformulated Locke to include the dimension of morality in her concept of rights. Generically, under her formulation, a "Right" is a moral/ethical prohibition against interference with ones actions. I.e., to claim a right to something or some action requires a moral/ethical justification.)
Both Rand and Locke appear to be irrefutable in what they actually said on the subject of rights - specifically property rights. Locke's position has held general sway both philosophically and legally for a LONG time. However, the mainstay legal positions taken by our legal system and most worldwide legal systems add in elements that neither Rand nor Locke included and in some cases explicitly disagreed with. Locke, for example, believed strictly in usage property. Use it or lose it. This was also the position of many branches of the Anarchist movement. And, Locke did not have any problem with joint, communal or tribal property.
Thus, Locke's position would have invalidated many or most of the land grabs by various imperial powers. The Spanish and Portuguese seizures of the Americas and elsewhere were based on the Divine Right of Kings, not Locke. When the English attempted to come up with a justification (after the fact in many cases) however, they were stuck with the Lockean position that underlay their legal code long before Locke formalized the philosophical arguments, under which any such grabs would be deemed simple theft. So, they decided that tribal land property was itself invalid, contradicting Locke's later published position. Locke in fact defended tribal ownership.
A final departure from the Lockean position comes with the failure to place “mixing ones labor” in context. It seems unlikely that Locke meant this to be an actual specific legal method of acquiring property rights. For example, can anyone point to anything that doesn't have a property claim attached? If property is acquired by mixing ones labor, then we are in trouble already, as I and most of humanity can claim the entire planet. Locke didn't set any practical limits to the claim that would inform us as to some objective standard specifying how much mixing of what kind of labor results in how much land property, and the assumption has been that this is a matter for the courts to determine.
“Robert Nozick criticized this argument with his famous example of mixing tomato juice one rightfully owns with the sea. When we mix what we own with what we do not, why should we think we gain property instead of losing it?”
But on what basis would a court be making that determination? If Locke's axiom is not sufficient, then what other considerations are needed for it? That opens a whole can of worms, doesn't it? Can't I claim the moon if I sketch a picture of it? It was my labor, and the subject of the labor was to acquire title to the moon. Or, if I build in a particular spot because of the great view and then someone moves in and blocks it, why don't I have a claim to the horizon? Do I have to mix my labor with every foot of land in question (and how deep do I have to go?), or is it sufficient to just plant a stake at the corners? Or take photos to court? But then, what about that claim to the moon? Or Mars? Failing an objective standard, the issue becomes once again purely one of authority, usually relying upon precedent, as in the Normanized version of the Anglo-Saxon Law.
But the Norman conquest's version of Common Law ignores the Commons, preferring to link the name to “Commoners.” It is from contracting with the Commons or its duly elected agents that original property claims arise. In the Commons, all land is owned in Common, equally by everyone, under rules established to ensure fair access and sustainable use. If someone wants to privatize a portion of the Commons, then he has to get permission in the form of a Title, which requires submitting the proposal and then convincing the Commons to go along. So, if someone wants to run a farm, he has to compensate the Commons for the loss of pasture as well as other inconveniences. In primitive economies this might involve pledging a portion of the harvest as payment. The right to the farmland would be surrounded with conditions implied or explicit, such as not polluting the water supply or otherwise annoying his neighbors, and it would generally be conditional, specifying when the lease would terminate, what guarantees of renewal might apply and under what conditions eminent domain could apply. Note that none of this violates Locke. Rather, it specifies a mechanism by which Lockean abstract justification for property claims becomes instantiated in real justifiable titles.
One further note that turns out to have some very interesting applications. What happens to the fees paid to the Commons? Naturally there are Common expenses, some of them due to the privatization. The Commons should make a profit on the deal, so where does that profit go after Common needs are handled? Naturally it goes to the Commoners, as a dividend on the productivity. This is only fair. Nobody is self-generated. We all owe most of what we have and value to our fellow human beings now and in the past, and to the evolutionary process that created and sustains us in the ecology of Mother Earth. No infant could possibly survive on his own. So, that payback from privatization to the Commons and the individual Commoners is only fair, reflecting that debt.
From a revolutionary perspective, knowing some of the consequences of illegitimate property, and noting how the theft of the original Lockean concept has been used as the justification, we can ask the question: “How could we undo this catastrophe?”
Issues in contention:
The legal battle over what constitutes proper law and thus, possible legitimate property claims is still going on, here in the U.S. with regard to such issues as patents, especially, and in places like China, which is transitioning de facto from an attempt for half a century to enforce collective property exclusively to the radical opposite.
There are other conflicts regarding intellectual property claims, which we will get to shortly. So far, we have dealt almost exclusively with property in land or physical objects or activity. One might assume generally that the arguments for land property, which takes something out of the Commons and inherently reduces the opportunities for other people of the Commons, would be that much stronger for physical property such as personal belongings – which are generally respected even in Neolithic foraging tribes – and for other objects that are often much less useful in collective possession such as homes, cars, home entertainment systems, etc. Note that the case can be made for collective or shared ownership of many such items – city sponsored bicycle exchanges come to mind, and on a case by case basis, the advantage could go either way. Some cultures can more easily support collective property than others.
Larger scale properties – larger in scope of time as well as physical dimensions - such as a shop or factory could also either be owned by a collective or by an individual, and there are plenty of successes and failures for both on record. It appears that often the key element for a collective business such as a co-op is the willingness for the owner/employees to bring a very realistic and hard-nosed business analysis to bear and maintain it over time. Perhaps individually owned businesses have fewer problems on that score, as the responsibility is personal and direct.
Now we are still left with the issue of intellectual property, which does not neatly divide across ideological lines such as right and left. For example, there are many libertarians who are totally opposed to patents and copyrights, claiming that they are simply another example of the state using its power to enrich itself and its friends and could not exist without the state’s power. Other libertarians totally disagree, often citing Locke. Of the two major founders of American Individualist Anarchism in the 19th century, one supported intellectual property; the other opposed it. I can only briefly touch on this in the time remaining, which is why I want to deal with intellectual property as a separate discussion.
Regarding Locke’s position on intellectual property: “A good illustration of this perspective is Robert Nozick's brief but influential discussion of patent law in Anarchy, State, and Utopia.  After associating himself with Locke's argument, Nozick turns his attention to Locke's famously ambiguous "proviso" – the proposition that a person may legitimately acquire property rights by mixing his labor with resources held "in common" only if, after the acquisition, "there is enough and as good left in common for others." Nozick contends that the correct interpretation of this limitation ("correct" in the senses (a) that it probably corresponds to Locke's original intent and ( that, in any event, it is entailed by "an adequate theory of justice") is that the acquisition of property through labor is legitimate if and only if other persons do not suffer thereby any net harm. "Net harm" for these purposes includes such injuries as being left poorer than they would have been under a regime that did not permit the acquisition of property through labor or a constriction of the set of resources available for their use – but does not include a diminution in their opportunities to acquire property rights in unowned resources by being the first to labor upon them. Construed in this fashion, the Lockean proviso is not violated, Nozick argues, by the assignment of a patent right to an inventor because, although other persons' access to the invention is undoubtedly limited by the issuance of the patent, the invention would not have existed at all without the efforts of the inventor. In other words, consumers are helped, not hurt, by the grant of the patent. Nozick contends, however, that fidelity to Locke's theory would mandate two limitations on the inventor's entitlements. First, persons who subsequently invented the same device independently must be permitted to make and sell it. Otherwise the assignment of the patent to the first inventor would leave them worse off. Second, for the same reason, patents should not last longer than, on average, it would have taken someone else to invent the same device had knowledge of the invention not disabled them from inventing it independently. Although Nozick may not have been aware of it, implementation of the first of these limitations would require a substantial reform of current patent law – which, unlike copyright law, does not contain a safe harbor for persons who dream up the same idea on their own.”
The implications for how the intellectual property issues are resolved are staggering:
1> Economically, it is now generally estimated that the majority of total wealth on the planet is in the form of intellectual property, mostly patents. The owners of intellectual property are concentrated in a way that dwarves the concentration of physical wealth. How many people do you know who own a patent? Vs. a house?
2> Historically, it has been argued that the economic collapse of France that led directly to the French Revolution was in fact a direct consequence of its patent code. Business productivity plummeted in what had been the wealthiest nation of Europe, as people and companies battled in the courts over a policy that granted anyone a patent on virtually anything just for being the first to apply – with the Crown’s courts taking a cut both via the patent fee and later when collecting fines from patent violators. One company had the patent for black warp. Another had the patent on black woof. Separately, they could only each produce cloth of 50% grey. Meanwhile, the Brits, whose patent system was much more restrictive as to the scope and limitations of what could be patented, ate France’s lunch and virtually took over the world right out from under them.
3> Eerily similar, here in the U.S., the developer of the Siri software for the iPhone made nothing for his efforts, due to being sued repeatedly by companies whose only asset and sole income was these spurious lawsuits. The Siri developer refused to be blackmailed and defeated every attack in court, meaning that he ended up virtually bankrupt and had to put on hold major projects such as access systems using Siri for the disabled.
4> Meanwhile, patent wars in general here in the U.S. are costing tens, perhaps hundreds of billions of dollars of lost productivity. Companies such as MicroSoft are notorious for buying out small innovative companies, allegedly often with a component of blackmail in a threatened patent suit, and then shelving most of the useful product of the company they just ate, just to keep it out of the hands of possible competitors – and add to their arsenal of patents used to get more patents via blackmail.
5> Intellectual property as a component of total wealth is growing by leaps and bounds. We are, after all, in the Information Age. Online Virtual Worlds do not merely make money for the owners. There is also a whole industry now based on acquiring Virtual property. If you want a magic sword for some Online game, you can fight for it or someone could sell one to you, either in game dollars or in the equivalent in Euros, U.S. dollars, you name it! Whatever can be manufactured – as in Second Life, which has a thriving trade in all manner of virtual objects manufactured by its inhabitants – can be sold, and there is a known exchange rate between the virtual currency and the “real money.”
6> The present state of the VR technology is just barely off the ground. When the next generation wearable computers – such as Google Glass – takes over, there will be entire new professions generated by the thousands, paralleling the explosion of Apps for the Smart Phones. This will eclipse everything that has come before and will be a gold mine for the developers and owners of any of the top ten thousand key patents.
Want a personal guide to Hong Kong? How smart does it need to be? What sort of credit line do you have? Would you like a virtual companion? Which sex and how pretty? The VR displays that overlay the street you’re walking down will reflect a focused effort to engage you by corporations with tens of billions of dollars invested in how to suck you and the billions of other yous into spending real money on their sponsored products. With a poor credit line, you may see a bare street with little of interest. But if you have money or other assets, then you will be coaxed and teased, flattered and beguiled by experts in the business of buying your attention. That bare street in Hong Kong – or anywhere – may look like the Emerald City of Oz, complete with Tin Man and Wicked Witches. Think Las Vegas combined with Disney World forever, on steroids, times1000. Every option you choose will have a price and perhaps a payback.
Those people on one side of this Digital Divide will be increasingly relatively impoverished in what their reality offers, struggling just to pay for the essentials necessary to live – like someone today without Email, while the wealthy will live in a world that adjusts itself every minute to maximize their experience. And all this tech will be patented. Everything you do or touch in the cloud will have a bill attached, reflecting the tens of thousands of proprietary patent and/or contractual rights to the myriad components of your experience of Overlaid or Augmented reality. You will LOVE it, and you will buy it, and those billions of purchases of paradise on Earth, or whatever they can afford of it… will finance an elite whose power will be like Gods, whose every moment of every day will be turned in every way to their advantage. Imagine trying to take them on via the courts or the democratic process…
I suggest that we better get this property thing right and do it SOON, or the Have/Have Nots issue will explode.
On Patent Law: It once was that to get a patent in the U.S., you had to satisfy several key requirements:
1> You had to be the first and original inventor.
2> The invention had to be a significant improvement in its field.
3> It could not be obvious to anyone knowledgeable in the field.
Now, the only requirement is that you pay your money and make the claim. If you are first to file, it’s all yours, and then, even if you would never be able to make any real money off the design itself, you can start watching for people who innocently violate that patent and sue them. This is what destroyed France and it could destroy us.
I suggest that a better solution would be to require that a patent holder license the patent to anyone who wants it for a reasonable fee, set at the time the patent was issued. The fee would reflect the costs of R&D plus a reasonable profit.
Obviously there is much more to be said on this issue and a key factor in any analysis will likely be ones take on the balance of the rights of the commons vs. individuals or sub-groups.
We appear to be left, at this point, with two major opposing positions on property, its usefulness and legitimacy:
1> Property is essential in preserving justice on the personal level – reaping the rewards of one’s self-chosen labor, and for its role in encouraging innovation and responsibility, as well as enabling dissent.
2> Property is immoral and socially destructive, reflecting and encouraging class hierarchy and wrecking social solidarity, setting people against one another over conflicting property claims.
Notes on pros and cons of property – for discussion:
1> Proprietorship: It is argued that a proprietor naturally has a personal (or group) concentrated interest in the value and success of whatever is owned. The more participants there are as proprietors, the more this interest becomes diluted. Ceteris paribus, a dilution of interest in outcomes can result in a lack of optimal attention and effort, due to multiple competing interests, if nothing else, plus free riders, corruption, etc. A concentrated interest in a particular property would correspondingly tend to encourage a concentrated attention and effort, naturally resulting in a net increase in value, at least for the proprietor.
On the downside, a proprietor’s interests may not be the same as that of the Commons or the larger collective. However, one of the prerequisites for a valid property claim under Locke’s model is that the claim not take away from the common value. I.e., a property title cannot validly exist at the expense of the Commons. This would normally, under the Law of the Commons, be handled by the Commons’ requiring a lease fee, plus perhaps a bond and/or insurance to offset any losses to the Commons as such. Thus, even though a proprietor may be primarily benefiting himself, a valid Commons property title at least is backed by a legal mechanism to ensure that the Commons does not lose anything.
2> Moral/psychological costs of property: It could and has been argued that property creates an inherent alienation between people. One of the landmark studies in support of this downside of wealth, at least, was done by Stewart Wolfe, who documented a culture in rural Pennsylvia that had virtually zero incidence of heart attacks and many other ailments.
According to Bruce D. Perry and Maia Szalavitz in their “Born for Love,” (a study of empathy, the factors that go into nurturing it, and the consequences of its lack) the results in Wolfe’s study were direct results of a local culture of profound egalitarianism. Most of the inhabitants came from the same small area in Europe. There were rich and poor, but no one flaunted his wealth, which was considered extreme bad form, and no one was treated as less deserving of respect if they were poor.
Similar analyses of various Scandinavian cultures appear to back up this conclusion. Cultures, in fact, (at least reasonably successful cultures economically) which have the least spread from poor to rich, also seen to have a higher general sense of well-being. There are very wealthy individuals in these countries as well, but they are not perceived as gaining any special privileges by their financial success. There is little envy or class consciousness so long as everyone has enough to live without severe hardship.
3> Specialization: Consider a collective in which everyone participates equally in farming, health-care, manufacturing, education, eco-monitoring, etc. vs. the same collective but with specialists in farming, etc. Especially for work requiring sophisticated skill sets, the latter collective clearly has an advantage, as the individuals who specialize in a particular type of work will have more time to perfect those skills. Proprietorship is a natural way to enhance the value of specialization, as the proprietor receives direct feedback as to the effectiveness of these skills, which may be masked in a collective effort. One downside to this is that a monopolization of skills may give one specialty a bargaining advantage relative to the Commons. Also, when everyone does everything, there is no hierarchy, while specialization tends to encourage class competition and the rise of self-serving hierarchies.
4> Long term planning: Property is one social mechanism that enables action over time. By restricting access or use, such endeavors as farming, orchards, and a host of other possible productive activities are enabled. For example, it takes about 35 years for an olive tree to reach productive maturity. For a sub-group or individual to invest the effort in such activities, they must have some reasonable assurance that the activity will succeed. While life offers few guarantees, property rights encourage long-term actions by forbidding interference from others who may have their own plans. If I build a boat for fishing and any local person can take the boat for whatever purpose, then my investment may be largely for naught, and few boats may be built.
5> Reduction of freedom: A property title grants the owner the right to forbid use of something by other people. Previous to the title, the thing in question might have been accessible to anyone who happened to want to use it and had the means to do so. The Common Law provides a mechanism – a lease fee, in general, although it could take many forms – for compensation to the community as a whole. However, the granting of title may reflect the choice of a majority of the collective members of the Commons or their elected agents.
There may well be a minority whose interests were not well served by that title. That minority may have a stronger individualized interest than the majority. I.e., their freedom to fish is directly impinged by the dredging of the harbor, while the majority of the collective who live on pork and yams are not impacted at all. This raises several issues. Fundamentally it is hard to see how any property title would not unequally deprive other individuals of prior freedoms. This reflects a fundamental choice by the collective to use property as a means of promoting such values as proprietary interests and skill specialization, at the expense of prior interests of individuals or particular sub-groups.
One possible remedy for this inequity is that the fishermen could pool resources and outbid the dredgers. But what if they can’t? Should they be eligible for special compensation? What limits should be set on that? This raises again the problem of “unclaimed” property. These are serious issues. (In Japan, some years before the 2011 tsunami, fishing villagers mounted a highly effective protest and blockade that stopped a projected nuclear power plant from being constructed where its cooling water would have killed the local sea life. The fishers had no legal title to the local sea, while the nuke owners did have a title to the land for the nuke. Perhaps the fishers should have demanded a legal title?)
In summary, is the incentive of a common lease fee and other possible benefits to the Commons as a whole worth relinquishing that freedom? However, it should be noted that in general, even without the legal mechanism of property title, there was never perfect freedom, except in the limit case of a single individual living totally alone. My picking of an apple from a tree precludes your picking the same apple. Most people would contend further that, in the absence of explicit property titles, once picked, the apple is “mine” to eat, unless I abandon it. “Mine” indicating a primitive use right – the moral prohibition against interference with my actions. You cannot have a corresponding “right” to seize the apple from my hand or mouth or where I set it, because that would require that you could morally forbid me from taking the actions necessary to live, which would contradict the moral foundation of life as a moral standard. Morally, you are required to respect that primitive right and ask my permission. The issue is the proper way to preserve both equity and productivity.
6> Disruption and dilution of authority: Many people place great importance on the values of authority to enforce order and their particular values. Property can clearly enhance authority. A rich employer can use that wealth as a carrot or stick. A rich person can buy the attention crucial to winning an election and then use state power to advance his ends, including acquiring more wealth. However, property can also be disruptive of authority, as in the legal prohibitions against violating ones security in one’s home. “An Englishman’s home is his castle.”
(This was part of a package of hard-won rights that secured basic freedoms for the English commoners via the Magna Carte. From the wiki: “NO Freeman shall be taken or imprisoned, or be disseised of his Freehold, or Liberties, or free Customs, or be outlawed, or exiled, or any other wise destroyed; nor will We not pass upon him, nor condemn him, but by lawful judgment of his Peers, or by the Law of the land. We will sell to no man, we will not deny or defer to any man either Justice or Right.[) )
When the concentration of property allows the effective freedom for the rich to aggress against the less wealthy there is a problem. All the supposed requirements of a level playing field and a fair and objective judiciary seem rather silly when we here in the supposed paragon of justice U.S.A. look at the relative concentrations of prisoners and arrests by race, and effectively by income. The rich do not often end up in jail. The less than rich are often forced into plea bargains simply for lack of resources to mount a good defense. Property then easily becomes a mechanism that feeds on its own success, using the levers of power in ways that those with fewer disposable assets cannot.
“"In its majestic equality, the law forbids rich and poor alike to sleep under bridges, beg in the streets, and steal loaves of bread." Anatole France
On the other hand, it is sometimes the rich and their ability to take on authority that provide a bulwark against tyranny that people on the bottom cannot afford. It was, after all, the nobles who forced the Magna Carta down the king’s throat. And many of the leaders of the American Revolution were wealthy landowners.
7> Disruption of cultural and legal solidarity: Property often allows the owner certain freedoms from the need to follow cultural norms. The English, who have one of the strongest traditions of property rights, are quite proud of a tradition of eccentricity. Property as a component of trade and markets allows people whose religions, politics or other beliefs would normally set them at each other’s throats to get along peaceably. A collective decision making process can yield the opposite, a situation in which everyone is required to go along with whatever the majority chooses. On the other hand, collectives offer much in the form of psychic rewards. People who share a culture and its values and customs have a basis for better and deeper communication and empathy.
A Radical Suggestion:
Allow me to just post this possible plan as an offshoot of the discussion of property, especially as a derivative of the Commons: On the original basis of the commons, had it been carried to the present, then everyone would be both paying the Commons for their individual or group’s private use and also collecting that privatization dividend. The rich could still be rich, but they would pay the fee, generally proportional to their properties. And no one would starve or live a subhuman life of misery, because they would all get that dividend, equally.
But how would we get there? If we tried to tax the dividend out of the rich there would be both mass resistance and a disincentive to produce. Also, much, perhaps most of the physical property on the planet has been stolen, often repeatedly. But, class war is not what we need. What we need is justice. But justice is not some absolute Platonic Idea and we are not philosopher kings with a monopoly on truth and virtue. What justice consists of is equity, setting things as straight as possible and trying to be as fair as reality allows. We can no more revert to a perfect state of justice to undo thousands of years of predation and faulty reasoning than we can undo a murder. What we can do is a best approximation.
In that context, the world economy of today could likely withstand a hit consisting of printing about 3~4 $trillion, in the form of checks going out to every single human being on the planet of $500 per person. This would be reflected in about a 5~8% inflation worldwide. Bill Gates would lose the same proportion as everyone else, to the tune of a couple $billion. But he would also get the same dividend - $500. However, for the people at the bottom, who are starving on less than $1 per day, this would mean LIFE! I.e., the wealthy would suffer a small loss. The people in the middle should break even, and the people at the bottom would be rescued. And, it is a first approximation of what the yearly planetary dividend should be. It’s possible that $1000 per person might be sustainable. The exact amount is certainly subject to debate, and it should increase over time to reflect a general growth of wealth.
Such a planetary dividend would come out of everyone’s pocket to begin with, as inflation of the world’s money supply. This is not necessarily a bad thing. Inflation can be an incentive to get out of money assets and into purchases of real goods and services. Deflation can be much worse than mild inflation, creating the incentive to hoard money, making it more difficult to finance productivity, which is pretty much where the U.S. and most of the world’s economy has been stuck since the crisis of 2008. Eventually, a fairer method for financing the planetary dividend, based on assessing fees for land use, as in the Commons model should probably be implemented. However, a key element to keep in mind is that long-term productivity in general requires economic predictability. No policy should be dropped like a bomb on the existing markets, as that would completely disrupt planning and thereby kill off investment.
Rather, I would argue this on several possible levels.
1> In the U.N., as a proposition consistent with its mission, where the majority of people would clearly benefit, lives would be saved by the hundreds of millions, and yet it would not directly impact or challenge existing authority except for a guarantee that the money would go directly to the individuals, ALL of them, with no room for playing power politics.
2> In the various World Courts, which already recognize the Common Law as a legal system, as a natural stop-gap remedy to a clear problem of inequity.
3> To the Progressive public. As a transition to a fairer and more sustainable society that implicitly bases itself on promoting the general welfare and the value of human lives and reducing hierarchies .
4> To the general public, as a method of reducing the looming conflicts over resources and the likelihood of multiple nation-state resource wars as Global Warming advances. (Note that Global Warming itself is due mostly to the 1st World energy consumption. I.e., WE are responsible for the coming eco-catastrophes and WE will be held accountable in the long run for sure. Better to get in front and lead than resist the truth and be blamed for the consequences.) Money is empowerment. You can’t do much if you’re starving. A few dollars in Bangladesh to take a train out of the path of a storm and buy something to eat at the other end can mean survival, and to a Congolese farmer, seeds and perhaps a plow, putting him on the side of production instead of destitute consumption. I.e., the net result will be to increase productivity and get people off charity or doles.
My original partner for this presentation asked if I were going to bring in Georgism (http://en.wikipedia.org/wiki/Henry_George) to the discussion. Well, no... too late! Much of what I’ve discussed and advocated with respect to property, its proper historical, moral, legal and economic framing would fit well in the Georgist philosophical frame. George has been characterized as the American Karl Marx, although the differences in their philosophies is vast.
The major basis for the comparison comes from the profound and revolutionary influence that Henry George had on American political/economic thought.
The Georgist position starts with the assumption that all land property belongs equally to everyone as their birthright. Yet George was a strong advocate of free markets and capitalism. What he saw as the fundamental problem that produced extremes of wealth and poverty, was that that birthright – the Commons - was left out of the equation. His version of the Commons dividend was the Single Tax, a tax on land value itself, the arguments being that first, unlike other forms of wealth, the value of a parcel of land is mostly determined by the surrounding community, not directly earned by the landowner’s efforts. Thus, the value of the land becomes unearned wealth, giving the landowner an unfair advantage in the market.
George’s solution was to have one and only one tax, upon the value of land privately held, compensating the Commons for the privatization. The Georgist position nearly swept the country in the latter 19th and early 20th centuries. George’s position from the wiki: “His most famous work, ‘Progress and Poverty’ (1879), is a treatise on inequality, the cyclic nature of industrialized economies, and the use of the land value tax as a remedy.”
Reference: What is the Common Law?
Very roughly speaking, the Common Law began as the Law of the Commons. It could probably be said to be the first level of explicit implementation of the implied general social contract, which consists of all the implicit agreements among people that are essential to maintaining peace and prosperity.
I.e., the Social Contact dictates basic equality in society. Otherwise, we have some people claiming or acting as though they were special, somehow superior and deserving of benefits taken from the rest of us. That kind of attitude and behavior is inherently conducive to war, as few people are willing to accept the idea that their lives are somehow less worthy than someone else’s. In fact, a feature that allegedly all Neolithic tribal societies share in common is an extreme egalitarianism regarding resources. I.e., any attempt to hoard food while others are hungry is cause for expulsion or execution.
However, the move to settled societies that depended upon long-term capital enterprises required specialization, and rules to prevent conflicts over use of scarce resources or resources such as farms or pastures. While rules set by consensus and tradition worked well in many past and current Commons, the expansion from tribal to village to town and city tended to break down the personal relationships and high level of social trust. It is generally estimated that the average human can relate personally to from 150 to perhaps 1,000 other people. Clearly this is a fuzzy estimate which depends upon the degree of personal knowledge and interaction. Some people may greatly exceed this limit, while others may find even 50 people to be a challenge.
Paralleling the transition from tribe to city, the rule of strict sharing equality gave way to rules governing specializations and finally to the rule of law - codified principles governing social action. The rule of law has gone through many evolutionary routes, usually based on privilege and hierarchy. I.e., Law itself became a self-serving meme that engendered a symbiotic relationship with a power structure whose welfare was directly tied to maintaining that memetic structure. There were, however, exceptions.
The Anglo-Saxon Common Law, for example, was based primarily on equity. I.e., it strove in general to limit authority to the recognition of what was fair for all. There was little criminal component to the early Common Law. If a person caused damage to another, and the matter could not be handled privately, then he could be brought to court and sued for compensation. Even a murder was treated as a civil tort. In both the Anglo-Saxon and Icelandic version of the Common Law, the family of the murderer had to pay WerGild to all those who suffered as a consequence. This might seem unfair today, but in that cultural context, an adolescent would be introduced into society as an adult, with adult rights and privileges, by his guardian, typically his family, who were held responsible then for that person’s conduct, but who could also expect support in old age or other tribulations in return. Today that bond or surety has been taken over by the state, which some would argue is a mistake.
One problem with the original Common Law was that if you were an invader, killing, raping, burning as you conquered, there was no immunity for your actions. Under the Common Law, willful failure to maintain equity – refusing to pay restitution or WerGild, for example, would result in the local court declaring you an Outlaw. Literally Outside the Law. Meaning that anyone could kill you and take your property without fear of being charged by the court, where you had no standing - by your own choice.
Thus, the Norman invasion of England in 1066 posed a problem for the invaders, who wanted to rule and prosper without constantly worrying about being murdered in their sleep. I.e., they needed to keep a legal system in place and yet not be themselves subject to it. So, they invented their version of the Common Law, no longer an extension of the Law of the Commons, but rather the Law of the Commoners – those persons who were not slaves, but held no rank of nobility. The strict focus on equity was supplanted by a larger focus on precedent and on positive law – law which was created by the rulers, ostensibly for the good of the Commons, but often purely reflective of the benefits of the rulers and their cronies. Note the similarities with today’s corporate lobbyists.
In general, property law has either served a ruling class, such as in the Norman conquerors of England or the European invasion of the Americas, or has served as a bulwark against aggression by subsuming law to the rule of reason, securing and stabilizing property rights and thereby encouraging productivity. The unfortunate thing is that there appears to be no clear and simple way to draw lines fairly reflecting the interests of the Commons vs. the individual or sub group.