At almost every level, politics is intertwined with economics. Election results are often thought to be determined by economic factors: at times of prosperity, governments are likely to be re-elected, but during recessions they face defeat. It is little surprise therefore that party politics is invariably dominated by economic issues. Parties compete against each other by promising higher rates of economic growth, increased prosperity, lower inflation and so forth. The influence of economics has been no less significant in political theory. For almost two hundred years, ideological debate revolved around a battle between social-ism and capitalism, a clash between two rival economic philosophies. This struggle was regarded as fundamental to the political spectrum itself, left-wing ideas being broadly socialist, right-wing ones being sympathetic towards capital-ism. In effect, this tendency reduced politics to a debate about the ownership of property and the desirability of one economic system over another. Should property be owned by private individuals and be used to satisfy personal interests? Or should it be owned collectively, by either the community or the state, and be harnessed to the common good?
Questions about property are closely related to conflicting models of economic organization, notably the rival economic systems that dominated much of twentieth-century history: central planning and market capitalism. At times, politics has been simplified to a choice between planning and the market. Forms of planning have been adopted in a wide range of countries, but the principle was applied most rigorously in orthodox communist states. What are the strengths or attractions of the planning process? But why, also, has planning often failed or been abruptly abandoned? In many respects, the rival idea of the market has been in the ascendency since the late twentieth century, being championed not only by liberal and conservative thinkers but by a growing num-ber of socialists as well. What is it that has made market-based systems of eco-nomic organization so successful? But why, nevertheless, has there been a continual need for government to intervene in economic life to supplement or regulate the market?
The most common misunderstanding in any discussion of property is the everyday use of the term to refer to inanimate objects or ‘things’. Property is in fact a social institution, and so is defined by custom, convention and, in most cases, by law. To describe something as ‘property’ is to acknowledge that a relationship of ownership exists between the object in question and the person or group to whom it belongs. In that sense, there is a clear distinction between property and simply making use of an object as a possession. For example, to pick up a pebble from a beach, to borrow a pen, or drive away someone else’s car, does not establish ownership. Property is thus an established and enforceable claim to an object or possession; it is a ‘right’ not a ‘thing’. The ownership of property is therefore reflected in the existence of rights and powers over an object and also the acceptance of duties and liabilities in relation to it. From this point of view, property may confer the ability to use and dispose of an object, but it may also involve the responsibility to conserve or repair it.
The range of objects that can be designated as property has varied considerably. Primitive societies, like those of the Native Americans, may have little or no conception of property. In such societies, inanimate objects, and especially land, are thought to belong to nature; human beings do not own property, they are at best its custodians. The modern notion of property dates from the seventeenth and eighteenth centuries and stems from the growth in Western societies of a commercialized economy. As material objects increasingly came to be regarded as economic resources
– as the ‘means of production’ or as ‘commodities’ capable of being bought or sold – the question of ownership became absolutely vital. The natural world was turned into ‘property’ to enable it to be exploited for human benefit. Nevertheless, property has not only been restricted to material objects. Human beings, for instance, have been thought of as property, most obviously in the institution of slavery but also in legal systems which have regarded wives as the ‘chattels’ of their husbands. However, different forms of property have developed, depending upon who or what was entitled to make a claim of ownership: private property, common property and state property. Each form of property has radically different implica-tions for the organization of economic and social life, and each has been justified by reference to very particular moral and economic principles.
Private Property
So deeply is the notion of private property embedded in Western culture that it is not uncommon for all property to be thought of as ‘private’. Nevertheless, private property is a distinctive form of property, defined by C.B. Macpherson (1973) as the right of an individual or institution to ‘exclude others’ from the use or benefit of something. The ‘right to exclude’ does not, of course, necessarily deny access. Someone else can use ‘my’ car – but only with my permission. The notion of property as ‘private’ developed in the early modern period and provided a legal framework within which commercial activity could take place. Private property thus became the cornerstone of the growing market or capitalist economic order.
Liberal and conservative theorists have been the most committed defenders of private property, but its justification has taken a number of forms. One of the earliest arguments in favour of private property was advanced in the seventeenth century by natural rights theorists such as John Locke. A very similar position has been adopted since the mid twentieth century by right-wing libertarians such as Robert Nozick. The basis of this argument is a belief in ‘self-ownership’, that each individual has a right to own his or her own person or body. If, as Locke argued, each person has exclusive rights over his or her self, it follows that they have an exclusive right to the product of their own labour – that is, what they personally have crafted, produced or created. Property rights are therefore based upon the idea that inanimate objects have been ‘mixed’ with human labour and so become the exclusive property of the labourer. This argument justifies not only exclusive property rights but also unlimited ones; individuals have an absolute right to use or dispose of property in whatever way they wish. According to Nozick, providing property has been acquired or transferred ‘justly’, there is no justification for infringing property rights, whether in the cause of social justice or in the interests of the larger society. Such a position, for example, sets very clear limits to the capacity of government to regulate economic life or even to tax its citizens.
Often linked to the idea of natural rights is the justification of private property as an incentive to labour. Found in Aristotle and developed by utilitarian and economic theorists, this defence of private property is based less upon moral principles than it is on the promise of economic efficiency. In short, it is only the possibility of acquiring and consuming wealth, in the form of private property, which encourages people to work hard and develop the skills and talents they were born with. Economists point out, moreover, that through the mechanism of market competition private property ensures that economic resources are attracted to their most efficient use, ensuring a productive and growing economy. Such an argument is based upon the belief that human beings are self-seeking and that work is regarded as essentially instrumental. In other words, work is at best a means to an end. The driving force behind productive activity is simply the desire for material consumption. Individuals will be encouraged to devote their time and energy to work only if there is the compensating prospect of acquiring material wealth.
Private property has also been linked to the promotion of important political values, notably individual liberty. Property ownership gives citizens a degree of independence and self-reliance, enabling them to ‘stand on their own two feet’. By contrast, the propertyless can easily be manipulated and controlled, either by the wealthy or by government. Thus, even political theorists who feared the emergence of economic inequality, such as Jean-Jacques Rousseau, the anarchist Pierre-Joseph Proudhon and modern social democrats, have been unwilling to contemplate the abolition of private property. This argument has, however, been put particularly forcefully by free-market economists, such as Friedrich Hayek. In The Road to Serfdom ([1944] 1976) Hayek portrayed property ownership as the most fundamental of civil liberties, and argued that personal freedom can reign only within a capitalist economic system. In his view, government intervention in economic life necessarily escalates to the point where all aspects of social existence are brought under state control. In effect, any encroachment upon private property contains the seeds of totalitarian oppression.
In addition to its economic and political advantages, private property also brings social and personal benefits. Private property, for instance, promotes a range of important social values. Property owners have a ‘stake’ in society, an incentive to maintain order, be law-abiding and behave respectfully. Conservatives have, as a result, praised the notion of a ‘property-owning democracy’. Such an idea underpins the radical proposal by Ackerman and Alstott (1999) that all young Americans should be given a financial stake in society in the form of a capital sum of 80 000 dollars (the estimated cost of a four-year education at a top US university). This attempt to establish a ‘stakeholder society’ clearly rejects the idea that property is an individual right based upon merit or just transfer. Indeed, it seeks to counter the unfairness that results from rights-based property ownership, which allows for wide and entrenched inequalities in the distribution of wealth, and so in life chances, resulting from the inheritance of property or its ‘just’ transfer. By contrast, the stakeholder justification for private property is that asset ownership would engender freedom and responsibility, widening opportunities for young people in particular, and encouraging people to think and act in accordance with longer-term considerations. In the process, it would also reduce dependency upon the welfare state and public services.
A final justification for private property sees property not as an economic resource or as consumable wealth, but rather as a source of personal fulfilment. Property has been seen as both a source of personal security and as an extension of an individual’s personality. Property provides security because it gives people ‘something to fall back on’. However, the enjoyment and satisfaction which property ownership brings is as much a psychological fact as it is an economic one. There is a sense, for instance, in which people ‘realize’ themselves, even ‘see’ themselves, in what they own – their cars, houses, books and the like.
The case against private property has usually been advanced by socialists, though modern liberals and conservatives have also at times recognized the need to limit property rights. The most common approach has been to view private property not as the cornerstone of liberty, but as a fundamental threat to it. One version of this argument warns that unfettered property rights can lead to a grossly unequal distribution of wealth, allowing property to become a means of controlling, even enslaving, others. This idea was expressed most graphically in Proudhon’s ([1840] 1970) famous dictum, ‘Property is theft’. What Proudhon meant by this was not so much that individuals have no right to property but simply that the accumulation of wealth in private hands can allow the rich to exploit and oppress the poor. The Marxist argument, however, is more radical. Marx adopted a labour theory of value, based upon the writings of Locke. This implied that the value of a good reflects the quantity of labour expended in its manufacture. Whereas Locke believed that property rights could be traced to an initial act of labour, Marx saw a stark distinction between those who own wealth, the bourgeoisie, and those whose labour is responsible for its creation, the proletariat. In the process of accumulating wealth, the bourgeoisie extracts what Marx called ‘surplus value’ from the labour of the proletariat. In other words, private property inevitably leads to exploitation and class oppression. In The Communist Manifesto ([1848] 1976), Marx and Engels were therefore able to sum up the theory of communism in a single phrase: ‘Abolition of private property’. Short of abolition, socialists, liberals and even con-servatives have, in different ways, accepted the need to regulate private property in order to counter the tendency towards social inequality and in recognition of citizens’ wider social responsibilities.
Common Property
Despite the common misconception of property as private property, the common or collective ownership of wealth has a history which long predates modern socialist thought. Plato recommended that amongst the philosopher-kings who should be entrusted to rule, property should be owned in common; and Thomas More’s Utopia ([1516] 1965) portrays a society without private property, in some respects pre-figuring ideas later developed in The Communist Manifesto. Whereas private property is based upon the right to exclude others from use, common property can be defined, in Macpherson’s words, as ‘the right not to exclude others’. In other words, a right of access to property is shared by the members of a collective body and no member is entitled to detach a portion from the common wealth and exclude others, thereby establishing ‘private’ domain over it. This does not necessarily mean, however, that no one is excluded from use of common property. The right of common ownership may be restricted to the members of a workers’ cooperative, a commune or locality. For example, access to common land may be restricted to people designated as ‘commoners’, ‘non-commoners’ being excluded, just as the free use of ‘public’ facilities like libraries, museums and schools may not be extended to ‘non-citizens’. In other cases, common ownership may be universal in the sense that no human being is, or can be, excluded from use, as has sometimes been advocated in the case of land. Although a modern corporation or joint stock company exhibits one of the characteristics of common property, being owned by a collective body, its shareholders, it is nevertheless better thought of as an example of institutionalized private property. Since shares can be bought and sold, an individual can detach his or her portion from the whole, something which common property does not allow.
The case in favour of collective property has usually been advanced by socialists, communists and communitarian anarchists. At the heart of this usually lies a theory of labour, but one very different from Locke’s. Locke believed that the right to private property could be traced to the labour of an independent and specifiable individual. Supporters of common prop-erty, on the other hand, have typically regarded labour as a social and collective activity, depending in almost all cases upon group cooperation rather than independent effort. It follows, therefore, that the wealth so produced should be owned in common and should be used to promote the collective good. Any system of private property simply institutionalises robbery. Common property has also been justified on grounds of social cohesion and solidarity. When property is owned in common, anti-social instincts like selfishness, greed and competition are kept at bay, while social harmony and a sense of collective identity is strengthened. Plato, for instance, believed common ownership to be essential because it would ensure that the class of rulers would act as a united and selfless whole. Socialists have typically seen common property as a way of ensuring that all citizens are full members of society, in which case it harnesses the collective energies of the community rather than the narrow and selfish drives of the individual.
Common property has also been sternly criticized. Critics allege that in robbing the individual of a ‘private’ domain of personal possessions, common ownership creates a depersonalized and insecure social environ-ment. Some socialists have implicitly acknowledged this problem in drawing a distinction between productive property, the ‘means of produc-tion’, which they believe should be collectively owned, and personal property, the ‘means of consumption’, which can still remain in private hands. Others argue that common property is inherently inefficient in that it fails to provide individuals with a material incentive to work and to realise their talents. A final problem with collective property is that it embodies no mechanism for restricting access to scarce resources, except a reliance upon natural good sense and cooperation. This is sometimes explained by reference to what is called ‘the tragedy of the commons’. Before the enclosure of land, all commoners had an unrestricted right of access to it, being able to graze as many animals as they wished. The problem was that in many cases land was over-grazed and became unproductive, a tragedy which affected all commoners. Systems of private property ownership get round this problem by allowing the market to ration scarce resources through the price mechanism. Where systems of common ownership have been introduced, however, access to scarce resources has usually been restricted by the imposition of some form of political authority. Thus common ownership has often in practice taken the form of state ownership.
State Property
The notions of common property and state property are often confused. Terms such as ‘public ownership’ or ‘social ownership’ appear to refer to property owned collectively by all citizens, but in practice usually describes property that is owned and controlled by the state. ‘Nationalization’ similarly implies ownership by the nation but through a system of state control. Nevertheless, state property constitutes a form of property distinct from both private and common property, though, confusingly, it exhibits characteristics of each. The resemblance between state property and common property is borne out by the fact that unlike private corporations the state acts in the name of the people and supposedly in the public interest. A distinction is sometimes made therefore between the ownership and control of state property: ownership, nominally at least, is in the hands of ‘the people’, while control clearly rests with the government of the day. In other respects, however, state property is more akin to private property. Ordinary citizens, for instance, have no more right of access to state property such as police cars than they do to any other private vehicle. Moreover, state institutions like schools, public libraries and government offices guard their property no less jealously than private corporations. However, the extent of state property ownership varies considerably from society to society. All states own some range of property to enable them to carry out their basic legislative, executive and judicial functions, but in some countries state property may encompass an extensive range of economic resources and even entire industries. In the case of state collectivization, as found in orthodox communist regimes such as the Soviet Union, all economic resources – the means of production, distribution and exchange – was designated as ‘socialist state property’.
Arguments for state property have often drawn upon those which also favour common ownership. For instance, if state property is regarded as ‘public’ it reflects the fact that collective social energy was expended in its production, and, unlike private property, it promotes cooperation and cohesion rather than conflict and competition. However, state property may also be said to enjoy advantages to which common property cannot aspire. In particular, the state can act as a mechanism through which access to, and the use of, scarce resources is controlled, thereby avoiding ‘the tragedy of the commons’. In the case of state property, however, the right of access to economic resources is limited not for private gain but in the long-term interests of the community. Moreover, unlike common property, state property can be organized along rational and efficient lines. This is usually made possible by some form of planning system, capable both of establishing economic targets and of allocating resources so as to ensure that these targets are met. The nature and merits of planning are considered in greater depth in the next section.
State property is, however, also subject to severe criticism. Advocates of common ownership normally point out that state property is neither ‘public’ nor ‘social’ in any meaningful sense. When resources are con-trolled by state officials they may engender precisely the same alienation as occurs in the case of private property. There is little evidence, for example, that workers in nationalized industries feel in any way closer to the service they provide, or more in control of the process of work, than do those who work for a privately owned company. In addition, state property has often been linked to centralization, bureaucracy and inefficiency. Whereas private property leaves the organization of economic life to the vagaries of the market, and common ownership relies upon the sociable and cooperative instincts of ordinary people, state property places its faith in a centralized and supposedly rational system of economic planning. However, all too frequently planning systems have become hopelessly unwieldy and inherently inefficient. Massive numbers of state officials are needed to direct the economy and there is a strong tendency for them to get out of touch with both the needs of the economy and the wishes of the consumer. Furthermore, there is the danger that the state can develop interests separate from those of the people themselves. In such cases, state property can be used to benefit bureaucrats and state officials rather than advance the common good. Collectivist regimes have therefore sometimes been portrayed as examples of state capitalism.
Post a Comment