Why Some Say Property Is Theft

Socialism, contrary to common belief, actually exacerbates the diminution of property rights that capitalism brings about. I will explain. 

Adam Smith, so highly touted as the philosopher of the free enterprise system, said this regarding the wages of labor:

“The produce of labour constitutes the natural recompence or wages of labour. In that original state of things which precedes both the appropriation of land and the accumulation of stock, the whole produce of labour belongs to the labourer. He has neither landlord nor master to share with him.” [1]

This is an observation that is hard to refute, even though the beginnings of property began before recorded history. Those who picked apples or shot deer in the early days of humanity certainly and rightly felt an entitlement to the fruits of their labor, and would have seen any attempt to divest them of the results of their efforts as an outrage justifying a violent response. And those who determined to engage in such divestment surely anticipated the need to use either violence or stealth to accomplish those ends.

Now humans eventually discovered that they didn’t have to rely solely on foraging to enjoy the fruits of the earth: they could deliberately grow things themselves. And so, they would cultivate a field for that purpose, and thereby secure a more reliable source of nourishment for themselves. But it wouldn’t make sense to engage in all that effort if someone else could come along and help themselves to whatever crop was grown there, or maliciously destroy the crops. And, perhaps, this would have been the beginnings of property in land.

We’re not alone in this, of course. Foxes have holes, and the birds of the air have nests. Nonhuman animals also build their shelters and mark their territory, and so our sense of property may well have preceded the development of homo sapiens.

It is beyond question, in any event, that humans had property before anyone philosophized about it. When they did, property was already an established fact, and the philosophers were endeavoring to describe what already existed, and speculate on its origins, rather than envisioning a world where property existed.

But when they engaged in their ruminations, the world where people simply acquired property directly from nature had long been past. The landlord and the master had arrived, and been on earth for some time. What’s more, much real estate had been taken by means of conquest, and often by means of forcibly dispossessing previous possessors. Violence was the deed to property for the most part, and it is no wonder that the socialists saw private property as the engine of oppression of the propertyless masses.

What didn’t seem to occur to them was that neither foxes, nor birds, nor human beings were mistaken about property, but that the title to property was everywhere suspect. Proudhon, to that extent, was right when he said that property is theft. [2] But “theft” implies a previous owner.

Now the natural compensation for labor is the produce of labor; the produce becomes the property of the laborer. So says Adam Smith. It follows from this that if it is taken from her by force or fraud it has been stolen. Before there were tools, people used their own bodies to acquire that produce. Their bodies were their machinery, their capital. And so, John Locke wasn’t lost in metaphysics when he said that everyone has a property in their own body. [3] And when tools were invented, these became extensions of the body, so that humans could perform work that they couldn’t do with their bodies alone.

From this it was natural enough to conclude that what was produced by capital goods belonged to the owners of that capital. What was forgotten was that laborers also brought their capital to bear on production: their own bodies. Thus, the workers, as a rule, have not received an ownership interest in things produced. Instead, their relationship to their employers has been seen as a kind of service contract; they are compensated for the service of bringing their labor to bear, utilizing the capital that is owned by others. This has created an artificial division between labor and capital, and it has put what is called labor in a continuing disadvantage in negotiating power with the recognized owners of capital, as Adam Smith recognized. The dire circumstances that can result have been outlined in a previous offering in these pages. [4]

It is true that some of those on the employee side can bring special skills to their work, for which they receive added compensation. Some even acquire the luster of professional status. But, outside of the skilled trades, acquiring the necessary skills to attain to those statuses can be an expensive proposition. Many find that they have entered their careers with a substantial debt, and, since the institutions that provide such training compete with one another for tuition, there is the further problem of people acquiring skills but no one to employ them in their chosen field. They have a debt, but not the job they acquired the debt to obtain. I will explore this further in a subsequent post.

For now, the general problem is that, due to the artificial distinction made between capital and labor, we have an employee class with a significant bargaining disadvantage with respect to the owners of capital. Socialism, true socialism, seeks an end to this conflict through the abolition of capital ownership. But socialism, seeing everywhere stolen property, concluded that any property must be stolen, and failed to see the possibility and reality of rightfully acquired property.

Now there have been attempts to ameliorate the more sinister results of capitalism through regulation. There have been minimum wage laws, and legislation supporting the right of workers to organize into labor unions. These approaches have had success, but they only work when there are positive laws to protect them. As the United States has witnessed, political forces can enter in to dismantle such protections.

But, hopefully, it is possible to emerge from the hypnosis wherein we have been told that there is a real distinction to be made between capital and labor, and that the two should rightfully be treated differently. This recognition would be the opposite of socialism, where everyone becomes a laborer. Instead, this would result in a social organization where everyone is a capitalist, or what is now understood to be a capitalist.

I have already discussed socialism. I will be looking at the other three solutions in subsequent posts.