Libertarians’ History Problem 3

(breaking onto multiple files because of trouble posting)
Part 1
Part 2

The second argument that Caplan rolls out is what Breunig calls the “folk morality” argument. I read this as the idea that one should be entitled to the fruits of one’s own labor. For example, if I build a house with my own two hands, then I “own” the house. If I plant seeds and water and weed a given plot of land, then I “own” the resulting crop. If I build a piece of furniture, or paint a picture, then it’s mine. Seems pretty straightforward, and this was basically the reasoning that John Locke used: “The labour of his body and the work of his hands, we may say, are strictly his. So when he takes something from the state that nature has provided and left it in, he mixes his labour with it, thus joining to it something that is his own: and in that way he makes it his property.” (By the way, Locke also argued that money was a set quantity of precious metal).

Caplan invokes this “folk morality” to justify the initial acquisition of private property. This makes some sense—we know, for example, that primates are hardwired to reject what they perceive as unfairness, such a greater reward for similar work effort.

And no doubt this sort of folk morality about fairness did play some sort of role. After all, why shouldn’t I be able to keep what I produce? And if I produce more than the next guy or gal, then why shouldn’t I have more? For libertarians, this is the cornerstone behind the private property argument, and really behind all of their philosophy. One is wealthy because one’s marginal productivity is higher, or one has highly specialized skills and rare talents. People are unequal in their abilities and disposition, so of course wealth is unequal. Anything else would be unfair.

But does this accurately account for kinds of wealth the disparities we see all around us today? After all, intrinsic qualities are distributed in people along a bell curve, or Normal distribution. Thus, if work equals reward, we would expect to see a pattern of wealth distribution which aligns roughly to that of skill/talent among individuals. How much “harder” can the wealthy work than the rest of us? After all, there are only 24 hours in the day, and a portion of those are spent sleeping.

Instead of the normal variation we see between individuals with, say, intelligence, conscientiousness, or physical strength, we instead see wealth distributed according to a “Power Law” or Pareto distribution.

Many empirical quantities cluster around a typical value…their distributions place a negligible amount of probability far from the typical value, making the typical value representative of most observations. For instance, it is an entirely useful statement to say that an adult male American is about 170cm (about 5 feet 7 inches) tall because not one of the 200 million-odd members of this group deviate very far from this size. Even the largest deviations, which are exceptionally rare, are still only about a factor of two from the mean in either direction and hence the distribution can be well-characterized by quoting just its mean and standard deviation.

…consider a world where the heights of Americans were distributed as a power law, with approximately the same average as the true distribution (which is convincingly Normal when certain exogenous factors are controlled). In this case, we would expect nearly 60,000 individuals to be as tall as the tallest adult male on record, at 2.72 meters. Further, we would expect ridiculous facts such as 10,000 individuals being as tall as an adult male giraffe, one individual as tall as the Empire State Building (381 meters), and 180 million diminutive individuals standing a mere 17 cm tall.

In fact, this same analogy was used in 2006 to describe the counter-intuitive nature of the extreme inequality in the wealth distribution in the United States, whose upper tail is often said to follow a power law.

So how, then, could such a distribution of wealth be the result of innate qualities or differences in talent or “hard work?”

It can’t.

In addition, the ability to deprive the community of the necessary resources to survive is quite contrary to the “folk morality” that Caplan invokes above. Any leader or member of a complex foraging tribe or simple agrarian society hoarding or depriving the others of necessary resources would quickly lose their social standing at the very least, and, in many cases, their lives. Thus “folk morality” is hardly consistent with the “sanctity” of private property posited by libertarians as “pure and natural.” As Matt Breunig points out, the “folk morality” invoked by Caplan is decidedly non-libertarian in its outlook:

The problem with the method is that the general folk morality of people, when taken as a whole, is not libertarian. Any assessment of how people generally feel about things in the economic realm would not generate the conclusion that they generally feel like laissez-faire capitalism is correct. We know this because no society ever selects those institutions and because libertarians write books all the time about how democracy is bad precisely because people as a whole are not sympathetic to the libertarian worldview.

An honest assessment of where folk morality is on economics would probably be something like: people have somewhat contradictory ideas about economic morality that roughly sum to the worldview that there should be property rights but also that those rights should give way to fairness and welfare goals to some degree.

I am not saying I agree with that general view or even that you should build your normative views this way. But if you are going to say the proper normative method is folk morality, as Caplan does, then it seems like you should actually take a comprehensive account of what that folk morality is, not just opportunistically pick off one piece of it.

To emphasize that point, it’s notable that traditional societies, even those with considerable surpluses, took extensive steps to keep inequality in check. To keep anyone from lacking the means of subsistence, land was periodically redistributed, and large infrastructure projects (irrigation ditches, walls, etc.) were built communally, often with corvée labor. The product of the land was owned and shared in common by all. Ancient contract law determined rights and responsibilities between families, not individuals as Henry Sumner Maine noted in his book Ancient Law. There was no such thing as “economic” behavior  as we understand the term today as Karl Polanyi concluded from his extensive survey of the anthropological data:

The outstanding discovery of recent historical and anthropological research is that man’s economy, as a rule, is submerged in his social relationships. He does not act so as to safeguard his individual interest in the possession of material goods; he acts so as to safeguard his social standing, his social claims, his social assets. He values material goods only in so far as they serve this end. Neither the process of production nor that of distribution is linked to specific economic interests attached to the possession of goods; but every single step in that process is geared to a number of social interests which eventually ensure that the required step be taken.

These interests will be very different in a small hunting or fishing community from those in a vast despotic society, but in either case the economic system will be run on noneconomic motives.

The explanation, in terms of survival, is simple. Take the case of a tribal society. The individual’s economic interest is rarely paramount, for the community keeps all its members from starving unless it is itself borne down by catastrophe, in which case interests are again threatened collectively, not individually. The maintenance of social ties, on the other hand, is crucial.

First, because by disregarding the accepted code of honor, or generosity, the individual cuts himself off from the community and becomes an outcast; second, because, in the long run, all social obligations are reciprocal, and their fulfillment serves also the individual’s give-and-take interests best. Such a situation must exert a continuous pressure on the individual to eliminate economic self-interest from his consciousness to the point of making him unable, in many cases (but by no means in all), even to comprehend the implications of his own actions in terms of such an interest.

This attitude is reinforced by the frequency of communal activities such as partaking of food from the common catch or sharing in the results of some far-flung and dangerous tribal expedition. The premium set on generosity is so great when measured in terms of social prestige as to make any other behavior than that of utter self-forgetfulness simply not pay. Personal character has little to do with the matter. Man can be as good or evil, as social or asocial, jealous or generous, in respect to one set of values as in respect to another. Not to allow anybody reason for jealousy is, indeed, an accepted principle of ceremonial distribution, just as publicly bestowed praise is the due of the industrious, skillful, or otherwise successful gardener (unless he be too successful, in which case he may deservedly be allowed to wither away under the delusion of being the victim of black magic). The human passions, good or bad, are merely directed toward noneconomic ends. [Polanyi; The Great Transformation, pp. 48-49]

That’s what actually happened. Folk morality, as it has been studied by anthropologists and sociologists, is decidedly communitarian, contra the beliefs of modern-day economists.

In his book Primitive Property, Emile de Layeleye concluded that while movable items, or “chattels” were considered private property from an early period, land and buildings were communally owned and managed. Arable land was periodically redistributed (just as debts were periodically annulled). He noted that such systems still existed in his own time (the late Nineteenth century) in various parts of the world such as Eastern Europe, India and Java. Land rights were usufructuary, and only transferable ceremonially between families if agreed to by the whole community. For example, he notes of ancient Rome: “Agriculture commenced and was developed under the system of common ownership and periodic partition. In the provinces of the Roman empire the soil was only occupied by title of usufruct.” Ancient families were the stewards, not the owners, of the land.

In his historical study he noted a gradual process of transferring ownership from communities to families to individuals unfolding over very long stretches of time, with creeping normality used to justify it after the fact. Of this evolution he writes:

It is only after a series of progressive evolutions and at a comparatively recent period that individual ownership, as applied to land, is constituted.

So long as primitive man lived by the chase, by fishing or gathering wild fruits, he never thought of appropriating the soil; and considered nothing as his own but what he had taken or contrived with his own hands. Under the pastoral system, the notion of property in the soil begins to spring up. It is however always limited to the portion of land, which the herds of each tribe are accustomed to graze on, and frequent quarrels  break out with regard to the limits of these pastures. The idea that a single individual could claim a part of the soil as exclusively his own never yet occurs to any one; the conditions of the pastoral life are in direct opposition to it.

Gradually, a portion of the soil was put temporarily under cultivation, and the agricultural system was established; but the territory, which the clan or tribe occupies, remains its undivided property. The arable, the pasturage and the forest are farmed in common. Subsequently, the cultivated land is divided into parcels which are distributed by lot among the several families, a mere temporary right of occupation being thus allowed to the individual. The soil still remains the collective property of the clan, to whom it returns from time to time, that a new partition may be effected. This is the system still in force in the Russian commune; and was, in the time of Tacitus, that of the German tribe.

By a new step of individualization, the parcels remain in the hands of groups of patriarchal families dwelling in the same house and working together for the benefit of the association, as in Italy or France in the middle ages, and in Serbia at the present time.

Finally individual hereditary property appears. It is, however, still tied down by the thousand fetters of seignorial rights, fideicommissa, retraits-lignagers, hereditary leases, Flurzwang or compulsory system of rotation, etc. It is not till after a last evolution, sometimes very long in taking effect, that it is definitely constituted and becomes the absolute, sovereign, personal right, which is defined by the Civil Code, and which alone is familiar to us in the present day.

The method of cultivation is modified in proportion as property is evolved from community. From being extensive, cultivation becomes intensive, that is to say capital contributes to the production of what was formerly derived from the extent of the territory.

At first, the cultivation is temporary and intermittent. The natural vegetation is burned on the surface, and grain is sown in the ashes; after this the soil rests for eighteen or twenty years…This mode of cultivation is not incompatible with the pastoral system and a nomadic life. Later on, a small portion of the land is successively put into cultivation, according to the triennial rotation, the greater part remaining common pasturage for the herds of the village. This is the system of Russia and Ancient Germany. Afterwards the cattle are better tended, the manure is collected, and the fields are enclosed. Roads and ditches are marked out, and the land is permanently improved by labour. Then the fallow is curtailed, powerful manures are purchased in the towns or devised by industry ; capital is sunk in the soil and increases its productiveness. This is the modern agriculture, the system of Italy and Flanders since the middle ages; never coming into action until the individual ownership of the land is completely established…

These necessities, these ideas, these sentiments, have been very similar and have acted in the same manner in all societies, at a certain period in their development, directing the establishment of institutions everywhere the same. All races have not, however, advanced at the same pace. While some had already passed out of the primitive community at the commencement of their historical existence, others still continue to practise, in our day, a system which dates from the very beginning of civilization…[Laveleye; Primitive Property, pp. 3-5]

As for Caplan’s “folk morality” argument, Laveleye concludes:

A study of the primitive forms of property is essential in order to form a solid foundation for the theory of property. Without understanding the real facts, the majority of jurists and economists have based property on hypotheses which are contradicted by history, or on arguments which load to a conclusion quite opposite to what they wished to establish. They strove to show the justice of quiritary property, such as the Roman law has bequeathed to us; and they succeeded in proving quite another thing — that natural property, such as it was established among primitive nations, was alone in accordance with justice.

To show the necessity of absolute and perpetual property in land, jurists invoked universal custom, “quod ab omnibis, quod ubique, quod semper.” (‘Always everywhere and by everyone.’ Universally accepted, agreed upon, or practiced.) “Universal consent is an infallible sign of the necessity and consequently of the justice of an institution,” says M. Leon Faucher. If this is true, as the universal custom has been the collective ownership of land, we must conclude that such ownership is alone just, or alone conformable to natural law. [Laveleye; Primitive Property, p. 337]

Thus, there is no “natural right” to property, nor are price-fixing markets spontaneous outgrowths of mankind’s supposedly “natural” instincts to “truck, barter and exchange.”  Nor were governments formed by mutual agreement of solitary individuals, but evolved by degrees through basic social instincts such as kin selection and reciprocal altruism. Our theories are based on imaginary scenarios posited by British thinkers of the Enlightenment attempting to justify the extreme inequalities they witnessed in their own day. John Locke, Thomas Hobbes and Adam Smith wrote lengthy philosophical treatises to justify what had been achieved by top-down violence and control over thousands of years on the part of elites before they were born. They did not look at actual history, nor, it seems, did they care to. But isn’t time we set aside their deductivist theories in favor of better ones; ones more accurate and better in line with the actual historical record and the facts as we know them? Won’t that get us further in seeking answers to our social ills?

In contrast to Bryan Caplan’s libertarian fairy tale above, David Harvey tells quite a different story about how private property was initially acquired and the establishment of price-fixing global markets:

…These include the commodification and privatization of land and the forceful expulsion of peasant populations; conversion of various forms of property rights (common, collective, state, etc.) into exclusive private property rights; suppression of rights to the commons; commodification of labour power and the suppression of alternative (indigenous) forms of production and consumption; colonial, neocolonial, and imperial processes of appropriation of assets (including natural resources); monetization of exchange and taxation, particularly of land; the slave trade (which continues particularly in the sex industry); and usury, the national debt and, most devastating of all, the use of the credit system as a radical means of accumulation by dispossession. The state, with its monopoly of violence and definitions of legality, plays a crucial role in both backing and promoting these processes.

David Harvey’s A Brief History of Neoliberalism (Naked Capitalism)

As Emile de Laveleye concludes in his exhaustive study of Primitive Property:

…these juridical antiquities, which seemed as if they could only be of interest to a limited number of savants, are of real, practical interest. Not only do they throw new light on fundamental institutions and on the mode of life of primitive races; but…they raise us above the narrow ideas, which make us regard that which is carried on around us, as the only scheme of social existence. [p. 3]

No wonder libertarians don’t want to talk about it.

2 thoughts on “Libertarians’ History Problem 3

  1. Off topic for this post, I’d like to ask two fan-boyish questions:

    Do you have a recommended reading list? Some, like Polanyi, are more obvious than others, but you draw from a fairly voluminous collection of books and websites. Would you be willing to share That?

    What started you down the path towards Hipcrime?

  2. What I take away from the tale of Genesis 47 is that, in the final reckoning, /even Pharaoh/ had exclusive rights over only 20% of his property, and those rights came with a duty to attempt to protect the entire population against famine.

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