Locke’s theory of just expropriation (crosspost from Crooked Timber)

For quite a few years now, I’ve been working on a response to Henry Hazlitt’s Economics in One Lesson, a defence of free-market economics first published in 1946, but still in print and popular among libertarians. Hazlitt, as he says, is essentially just reworking Bastiat’s analysis of opportunity cost, represented by the broken window parable. What I’m trying to do is take the idea of opportunity cost seriously, and apply it across the board, including to issues of income distribution and property rights. It’s obvious (to me, at any rate) that any allocation of property rights to one or more people has an opportunity cost, namely the benefits that could be realised if the property rights were allocated to someone else. This is a live issue when property rights are being created explicitly right now, as they are with various kinds of intellectual property. But it is just as relevant when we come to consider the historical origins of property. I’ve spent a fair bit of time debating the question of whether property rights have a basis (say, in natural law) for existence independent of the states or governments that typically define and enforce them. I don’t want to talk about that issue right now, but it explains why I’m taking an interest in (I think) the most prominent proponent of natural law in relation to property, John Locke.

It’s a long time since I read Locke and, at the time, I was mostly concerned with Hume’s objection that

there is no property in durable objects, such as lands or houses, when carefully examined in passing from hand to hand, but must, in some period, have been founded on fraud and injustice.

That’s true of course. But rereading Locke[^1] I now conclude that he is not offering a theory of original acquisition, but rather one of expropriation, designed specifically to justify the “fraud and injustice” to which Hume refers.

Locke’s central idea is that agriculturalists, by mixing their labor with the soil, thereby acquire a title to it. He immediately faces the objection that before the arrival of agriculture, hunters and gatherers worked on the land and gained sustenance from it. So, it would seem, the would-be farmer has arrived too late. The obvious example, to which he refers several times, is that of European colonists arriving in America[^2]. Locke’s answer is twofold.

First, (Sec 31) he invokes his usual claim that there is plenty of land for everybody, so that appropriating some land for agriculture can’t be of any harm to the hunter gatherers. This is obviously silly. It might conceivably be true for the first agriculturalist (though on standard Malthusian grounds there is no reason to suppose this), or the second or the fiftieth, but at some point the land must cease to be sufficient to support the pre-existing hunter-gatherer population. At this point, well before all land has been acquired by agriculturalists, his theory fails.

Locke must surely have known his claim to be false, not as a matter of abstract reasoning distant history, but in terms of contemporary fact. His Treatises on Government were published in 1689, a year after the outbreak of King William’s War (the North American theatre of the Nine Years War). The core issue in this war, as in a string of earlier conflicts, was control of the fur trade, the most economically significant form of hunter-gatherer activity. But underlying that was the general pressure arising from the steady expansion of European agriculture into lands previously owned by Indian tribes. As a capitalist, and shareholder in American businesses such as the (slaveholding) Bahama Adventurers, Locke could scarcely have been unaware of these facts.

His real defence is that regardless of whether there is a lot or a little, uncultivated land is essentially valueless (Sec 37). All, or nearly all, the value, he says, comes from the efforts of the farmers who improve the land. Since God gave us the land to improve, it rightfully belongs to those who improve it (Sec 34).

This is exactly the reasoning of the Supreme Court majority in Kelo v. City of New London. Ms Kelo and her neighbors were indeed occupying the land in question, but, so the Court concluded, they weren’t able or willing to make the best use of it. So, the only way the City could ensure the best economic use of the land in question was to use its eminent domain power of compulsory acquisition.[^3]

All of this relates back to the point I’ve raised before [^4], that the credibility of any Lockean theory defending established property rights from the state that established them depends on the existence of a frontier, beyond which lies boundless usable land. This in turn requires the erasure (mentally and usually in brutal reality) of the people already living beyond the frontier and drawing their sustenance from the land in question.

[^1]: In the course of looking for the right material, I found this piece by Samuel Goldman of The American Conservative very helpful. Goldman in turn links to a debate between Matt Yglesias and Bryan Caplan.

[^2]: The Lockean theory of expropriation was applied with even more force in Australia, with the central term in debate being the idea of terra nullius. It was only in the Mabo case, decided in 1992, that any land ownership rights predating European occupation were recognised.

[^3]: Granting the assumed facts, and addressing the issue in terms of the general status of property rights rather than the specifics of the US legal system, I think the principle on which the case was decided is correct. Governments create property rights and can change them or reallocate them if it is socially beneficial to do so. However, from long experience of cases in which monetary benefits are supposed to trump the real, if hard to measure, economic value of people’s attachment to their homes (whether or not they are the owners), I doubt that the asserted facts were correct, any more than it is generically true that the replacement of hunter-gatherers by agriculturalists is universally beneficial.

[^4]: And, rereading the comments thread for that post, I see that Chris Bertram already made the main point here, that Locke’s theory specifically favored agriculture. In that discussion, I assumed that Locke’s position was one of abstract theory, which formed part of the background to C19 expropriation, rather than a justification of an expropriation that was actually taking place.

41 thoughts on “Locke’s theory of just expropriation (crosspost from Crooked Timber)

  1. @John Quiggin

    Quite so, a justification for modifying property rights requires a demonstration that the result is to improve the welfare of society as a whole.

    I can agree with compulsory acquisition on just terms in some such cases but not mere appropriation. I think the Australian constitution gets this right except in so far as the relevant clause does not also bind state governments. Acquisition on just terms demands that at least some consideration is given to the threshold of improved societal welfare is not too low.

  2. The LDP would be more honest if it just renamed itself the White Propertarian Party. There “limited and accountable government” policy says:

    More than any other political party in Australia, the Liberal Democrats support private property rights.

    Yet they have no policy on indigenous land rights.

    Then of course there is Senator Leyonhjelm’s odious speech in which he rejects constitutional recognition of Aboriginal people and opines that maybe the Aboriginals displaced some other peoples sometime in the distant past.

  3. jt – the trick with trolling is to try and hide the fact that you are trolling and pretend that you’re making some sort of legitimate point worthy of a response. You’ve failed.

  4. Terje – jt may be trolling but saying that the ‘Liberal Democratic’ Party has disgusting policies is still worth saying. Proudhon would have been proud of jt, I think.

  5. TerjeP :@Nevil Kingston-Brown
    Nobody alive today was there at the time.

    I’d like to explore some implications of this definition.
    1) There are many living Australian Indigenous people who were born living a traditional or quasi-traditional life on their traditional lands – some were essentially uncontacted by Europeans until the 1960s. So this would seem an argument for further extensive land grants to Indigenous people across the north and west of Australia.
    2) What about corporate identities? There are corporations in Australia that have had continuous existence since colonial times, although they may have merged with others over time, e.g. most of todays banks were formed by the amalgamation of smaller colonial era banks. These banks made large profits through direct or indirect land expropriation (e.g. loans to pastoralists and miners who directly and forcibly expropriated land, using the land as capital). Similarly in the US there are corporations still trading today which took an active role in the slave trade. Since these legal persons are still “alive”, or at least have a continued existence, can they be financially liable for damages?
    3) Taking death as the dividing line implies no objection to confiscatory-level death duties, since the people who accumulated the money aren’t alive at the time. Similarly, this implies that all royalties, patents, etc should expire at the death of the author/discoverer.
    4) More generally, since the deaths didn’t just “happen” but were often premature the result of bullets, diseases and starvation inflicted by colonialists, a principle of historical property rights expiring at death implies that property can be legally transferred by state-sanctioned murder. e.g. If a future Australian Green totalitarian government were to make being a right-wing columnist punishable by death, this principle implies that the government would have a right to Andrew Bolt’s property. Killing him might be inherently unjust, but once he’s dead, his property can be legally seized by the government.

  6. 1. Maybe.
    2. Maybe.
    3. No to death duties, yes to patents etc expiring.
    4. Anything can be legal. Doesn’t make it right.

  7. @TerjeP
    1-2) I’ll take it “maybe” means you want more time to think.
    3) Why patents but not death duties?
    4) I’m pretty sure you were arguing earlier that it was not necessary to materially redress past wrongs if the principal victims of the wrongs are now dead. Therefore, if Andrew is dead and I seize his property, I don’t have to give it back to anyone.

  8. 1) I broadly agree with you on this. But you’d have to be more specific to get a definte agreement from me.
    2) I agree they may be financially liable but the specifics of the claim have not been outlined. What did they do and how much liability are you asserting?
    3) Because patents should not last forever. It’s being extinguished not confiscated.
    4) If you shot Andrew and took his property I would support you being punished and the property being handed to his heirs. But if you sold or transferred the property to some other party and 70 years had passed and you were now dead and so where his immediate heirs I would probably not be seeking to unwind the past injustice.

  9. Chris O’Neill :

    But what do we do as an alternative?

    Pretty simple really. The state-enforced right to own naturally-created property such as land should be paid for with tax – land tax in the case of land.

    I was thinking of:

    a. Something durable rather than illusory – like putting a tax in place and expecting it to be eternal and a panacea – we have witnessed I think in the past 70 years a roll out of nationalization followed by the reaction that rolled public ownership back beyond 1900. So I think the idea of just imposing an ad hoc land tax isnt any real solution with the current versions of h. sapiens and his governance forms. Another thing a tax doesnt address is the discounting monster whereby it pays people to trash the land for short term extraction of say timber/nutrients to yield a short term profit rather than husband it in perpetuity.

    b. More broadly how do you compensate, for example, creators of intellectual property when the legal system you are proposing we use is stacked in favor of the existing rich, powerful and knowledgeable. Remember the golden rule, them that has the gold makes the rules.

    Unfortunately current solutions to the problems of equity, justice and not over exploiting the land dont address how to control/change the capitalist memes that drive our society either – if you like human nature. Marx never got this right to judge by the appalling regimes that sprung up using his theories. And his good observations still havent got traction. For heavens sake atheists are still being pilloried 175 years later for words to the effect that religion is by in large an optiate.

  10. @TerjeP

    you were now dead and so where his immediate heirs

    What is the huge difference between inheritance rights of children and grandchildren?

  11. @Newtownian

    Something durable rather than illusory – like putting a tax in place and expecting it to be eternal

    There is no law that says tax is eternal. Taxation policy requires ongoing understanding of the issues involved. Without understanding, society will be deficient anyway, so your point is rather a strawman.

    and a panacea

    Now that definitely is a strawman argument. No one is claiming it is a panacea. Perhaps you are unaware of the economic advantages of land tax over nearly every other type of tax so it ought to be a very important part of any tax system. An interesting introduction to the subject is this article which states:

    “Henry George’s theme was that the fundamental reason for the mal-distribution of wealth in a free enterprise society was the private ownership of natural resources. He did not advocate the nationalisation of land as did some of his socialist contemporaries but a concentration of revenue-raising, or a single tax as it came to be known, upon the value of land, so that its yearly worth or economic rent would be taken into the public treasury in lieu of taxes on labour and production.”

    Some people mistakenly think that land tax is meant to take the place of all other taxes but there is no law of logic that says that. Land tax is simply more economically efficient than nearly every other tax.

    ad hoc land tax

    There is nothing as hoc about it. Land tax has been analyzed as much as any other tax.

    Another thing a tax doesnt address is the discounting monster whereby it pays people to trash the land for short term extraction of say timber/nutrients

    Perhaps you don’t know much about resource economic rent taxes either. One of their fundamental purposes is to address that concern.

    the legal system you are proposing we use

    Sorry, which legal system am I proposing we use?

    Remember the golden rule, them that has the gold makes the rules.

    I remember it every time I see people arguing against land tax. In this case, them that has the gold (land) makes the rules. People with land don’t like land tax. They make the rules that keep land tax low for most people.

    Unfortunately current solutions to the problems of equity, justice and not over exploiting the land dont address..

    Indeed. The current “solutions” don’t include substantial land tax or resource rent tax so it’s hardly surprising that they don’t solve problems of equity, justice and not over exploiting the land.

  12. > It’s being extinguished not confiscated.

    There’s no rigidly-definable difference; the land isn’t being “taken away”, the right-to-exclusive-possession is extinguished, or rather the courts will no longer act to enforce any rights the “owner” claims.

    [what difference there is stems from the underlying differences between land and abstract concepts, not on account of any differences in the rights held.]

    [again: “i am satisfied” isn’t a statement that anyone else cares about, and if you’re only interested in debate for your own elucidation rather than helping other people… honestly that’s pretty selfish.]

  13. @Tim Macknay
    My sang froid in the face of other people’s suffering has deepened in the last three days during which time I’ve had numerous conversations with Upper Hunter cattle producers and townies all of whom have reassured me, by golly, that the all time record rain dump (volume in 24 hours) on Dungog, Tocal, Branxton and Stroud was merely a routine ten year event. When questioned when was the last time that anyone saw water over a particular town bridge the answer was a stony silence from people who pride themselves on being ‘fifth generation locals’, as they are quick to tell you, whose local knowledge this time choked in their throats because no-one had ever seen that volume of water in so short a period before. Not ever. But its got nothing to do with climate change. No siree. Mabel! Count the cows! That bloody greenie has been around here.

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