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2012-06-09
Capitalism and Property as a Natural Right
I think that the main argument -and incidentally an appealing one- for capitalism is the idea that private property must be respected -as a moral imperative. That is, no one should take another's money (or what have you). Locke, for example, claimed that there are three natural rights: life, liberty, and property. And the champion of modern capitalism, M. Rothbard, also endorsed this view repeatedly. Furthermore, he took the property right to be entailed by the property right on one's own body:

Thus every man having a natural right to (or being proprietor of) his own person and his own actions and labor, which we call property, it certainly follows, that no man can have a right to the person or property of another: And if every man has a right to his person and property; he has also a right to defend them
--Introduction to The Ethics of Liberty

If a man has the right to the self ownership, to the control of his life, then in the real world he must also have the right to sustain his life by grappling with and transforming resources; he must be able to own the ground and the resources on which he stands and which he must use. In short, to sustain his "human right".
--The Ethics of Liberty

However, capitalism lost its allure for me when I read Nozick's remarks about Locke's proviso and when I read the book The Myth of Ownership: Taxes and Justice by Nagel and Murphy. The following are the points that convinced me that the mentioned argument for capitalism is not sound:

1- Lockean proviso. Basically, it is the idea that right to property is not an exceptionless right. Locke says:

Nor was this appropriation of any parcel of land, by improving it, any prejudice to any other man, since there was still enough and as good left, and more than the yet unprovided could use. So that, in effect, there was never the less left for others because of his enclosure for himself. For he that leaves as much as another can make use of does as good as take nothing at all. Nobody could think himself injured by the drinking of another man, though he took a good draught, who had a whole river of the same water left him to quench his thirst. And the case of land and water, where there is enough of both, is perfectly the same.

--Second Treatise of Government, Chapter V, paragraph 33

That is, I have the right to property (of anything) as long as there is "stil enough and as good left"; property, thus, is not an inalienable right.

About the view that right to property is implied by our right to our own body, different but subsantial considerations apply. As Nozick put it, if I drop a can of Coke on the ocean, thereby mixing my labor (the can has been legally bought or even made by me) with the ocean, does it mean that I have acquired a right to the property of the ocean? The conclusion to be drawn, then, is that there is not a clear-cut limit of what I have a property right to, even when I have somehow mixed my labor with it.

2. Nagel's and Murphy's main thesis is that, given that property rights are conventional (see above), a State is justified in establishing certain rules about what and how much can be possessed by any particular citizen. The situation,consequently , is this: your money (wealth, in general) is only your post-tax money, given that that is the money you have really earned in that system (remember that that system is what has enabled the conditions for you to earn that money).


The feeling of natural entitlement produced by an unreflective sense of what are in fact conventionally defined property rights can encourage complacency about the status quo, as something more or less self-justifying. But it can also give rise to an even more confused criticism of the existing system on the ground that it violates natural property rights, when, in fact, these “natural” rights are merely misperceptions of the legal consequences of the system itself. It is illegitimate to appeal to a baseline of property rights in, say, “pretax income,” for the purpose of evaluating tax policies, when all such figures are the product of a system of which taxes are an inextricable part. One can neither justify nor criticize an economic regime by taking as an independent norm something that is, in fact, one of its consequences.
--The Myth of Ownership.

Is there any way of savig capitalism from these criticisms?

2012-06-11
Capitalism and Property as a Natural Right
Why save it and not recognize that whatever legitimacy there is to capitalism's claims, it is limited? What is the attraction of pure capitalism?

2012-06-11
Capitalism and Property as a Natural Right
I have a very rough draft paper that discusses some of these issues:

http://eis.bris.ac.uk/~plcdib/territory/papers/bertram_justice.pdf

2012-06-12
Capitalism and Property as a Natural Right
It seems you are identifying capitalism with laissez-faire policies and absolute property rights. I have two questions. First, why is that the canonical meaning of capitalism? In ordinary parlance, there are many capitalist or mainly capitalist countries in the world, none of which satisfy that definition. Second, why is it important to preserve or save that (i.e., pure capitalism with absolute property rights)? Why not, for example, follow Kant in thinking that property is a fundamental right, but one that needs definition and limitation by a legal system?

2012-06-14
Capitalism and Property as a Natural Right
I am enjoying the discussion very much. And I feel that the comments by John and Robert, as well as the paper by Chris, (thank you for sharing that) are fundamentally in agreement. That is, all of you consider that property right is not an inalienable, unrestricted right. Capitalism, then, has, as John put it, a limited legitimacy.

With regard to Robert's question, yes, I was thinking about laissez-faire capitalism, in particular about the type of capitalism advocated by Rothbard, that is, anarchocapitalism. I think that once you are willing to confer some legitimacy on the State and, in particular, on it carrying out some or other redistributive policy, "capitalism" is so mitigated that I am not sure whether the label applies. In this sense, it is possible that there are no capitalist countries in the world, but only more or less mixed economies, or more or less developed Welfare States.

In their book, Nagel and Murphy stress that the current political atmosphere is apt for the capitalist argument -my money is my money, no one should take it away, let alone profligate politians- and they then develop their argument, which, as I said, is more far-reaching than the recognition of property right as a limited right, that you are entitled to your post-tax money, being your pre-tax money not much more than a number in an accounting record. In their words:

Tax policy analysis needs to be emancipated from everyday libertarianism; it is an unexamined and generally nonexplicit assumption that does not bear examination, and it should be replaced by the conception of property rights as depending on the legal system that defines them. Since that system includes taxes as an absolutely essential part, the idea of a prima facie property right in one’s pretax income—an income that could not exist without a tax-supported government— is meaningless. There is no reality, except as a bookkeeping figure, to the pretax income that each of us initially “has,” which the government must be equitable in taking from us. It isn’t that there are no questions of equity here— justice is central to the design of property rights—only that this is the wrong way to pose them.


I read this argument as a defence of a contractualist theory. Let me explain this. Capitalism, in its defence of unlimited property rights, would incur the Robinson Crusoe fallacy, that is, if you are not the first one to be born or to have arrived here, it is probable that a number or people have already imposed some rules over many things, including how the generated wealth is distributed. These rules can be debated and some of them may be found immoral, but the question is that these are not immoral per se. It would be unfair to take away any of the things Crusoe had gotten; it is not necessarily unfair to tax your money in one of the countries that exist nowadays.


2012-07-08
Capitalism and Property as a Natural Right
I've not read Nagel and Murphy, but the argument you present seems to be an obvious non sequitur. My income could be regarded as a resultant of two components, namely, the income I would have had under the 'natural' system of property rights less the reductions due to government interference in that system. In that case, all I have to thank government for is making me poorer.

2012-07-08
Capitalism and Property as a Natural Right

In reply to:: 'Is there any way of savig capitalism from these criticisms?'

Defending Capitalism: The Essence of Economic Freedom

By Sidharta Chatterjee

Introduction:

The sense of ownership is something very different from the one-the sense of belonging to something.  However, the sense of ownership should be based on some normative paradigm of freedom and liberty to hold or dispose off of one's ownership of property. Property encourages rationality (See Richard Weaver) and culminates the sense of responsibility. Systems of principles based on which such ownership is mandated should have some normative moral value-which shapes ownership of wealth or capital. The right to private property forms the bedrock of economic freedom, and that freedom translates into self-responsibility which moulds into concrete policies of how to hold or dispose of that private property. It is true that such a freedom to hold private property is mandated in the social space and political system to which the beholder belongs to. In fact, Locke(1632-1704) argued that people have rights, such as the right to life, liberty, and property, that have a foundation independent of the laws of any particular society. To enjoy a stable and comfortable economic environment, it is essential to have in place a political system which creates opportunities to own, trade and transfer/dispose off one's own property at will. Freedom of private property create opportunities to trade, that is, how much one is expected to own or sell to others, since, everyone cannot own everything, since, there would be no trade.

Free Trade Opportunities:

The opportunity to trade and own property depends on the principles of the free society (See Fred Hutchinson), and on the degree of freedom that the political institutions practice. Efficiency of a political system determines the course of trade and preconditions of free trade. However, ownership rights bring in personal privileges, to that extent only where the owner of wealth capital should derive advantage which comes from the wealth, that is, the power to buy what and how much of certain goods and services. Indeed, there remains much risk to the distortion of advantages which an owner may or may not derive which comes from his wealth- power to influence by wealth or buy corruption out of his wealth. The goodness in men and women determines the degree of morality and moral excellence that he or she practices. He can choose to buy pornography materials or afford a good meal to a hungry person, or donate or buy something other essential or luxury services. It is up to the owner of capital how he would spend his wealth, rationally. Human moral values shape human polity, and social norms. Given in a free society, one is free to buy and sell anything, good or bad, and everything that he has or produces, governed by institutional norms and ethical directives.

Property Rights: Equal for the base and the Noble

 Holding property as well rights on property enables one to exercise ones' rational capacity or one's faculty of reason. Nobody stops a poor man from becoming rich by exploiting the resources provided by the norms of capitalism. Capitalism endorses the principles of entrepreneurship, which was rather undermined or ill-defined by Marx. According to Sadowsky:

"The owner of property performs an entrepreneurial function. He must predict the future valuation that he and others will make and act or not act accordingly. He is rewarded not primarily for his work, but for his good judgment"--James Sadowsky.

Human desires are reflected in the markets, and the demand determines which goods and services require to be produced. Effective pricing systems in a free market economy inform producers about consumer needs and desires. So, in other words, human necessity and desire guides production in a free market economy. Now, what factors ought to determine and model human desires, or how human wants and desires are shaped?

Capitalism, standing on the shoulders of democracy, facilitates such freedom and moral excellence throughout a culture that thrives in property rights and right to exercise one's free will. Capitalism is not anarchic; yet it is but to anarchists; neither it mandates exploitation of workers; rather it is mandated by those who have such moral inadequacies, particularly, the norms and ethics which form its foundational stones. One should be able to differentiate between capitalism and capitalists. 

As William Shakespeare has mentioned:
"Wisdom and goodness to vile seem vile: Filths savour but themselves" 

Capitalism is a political ideology, an institution governed by certain ethical norms which are shaped by human morality, for collective welfare and good. A capitalist's desire may be varied; good or bad. Yet, he is to follow the norms of capitalism which is meant for shared interests and wellbeing.

Criticism against attacks: Defenses

Indeed, capitalism is often attacked for being anarchic, neglects the poor where workers are exploited. It is much blamed for creating wealth inequality and disparity in wages. However, under capitalism, one is free to learn to invent and enjoy its use. One is free to produce and consume. One is free to employ workers and free to let them off.  The market determines the price of goods and demands for services, and determines wages and parity. Nobody “dictates” what the wages should be; it is determined by free market forces. So, where originates the question of exploitation? Certainly, this is in vague in those economies having political systems other than capitalism; in communist nations, nations under dictators, who are factually, enemy of the rights of the property owner. Consider land-grants and property holdings in systems other than capitalism, where, individual feudal lords generally held lands and properties disproportionately, and not determined by free market forces, as of, how much you can own and hold in a free market? The competitive forces in free market determine individual property ownership and development. 

Summary:

Capitalism enforces the freedom to desire by removing restrictions on human economic actions where human freedom becomes inseparable from economic freedom. Capitalism is the evolving pillar of economic freedom, and Democracy sustains capitalism. Capitalism is the present attribute of democracy. If capitalism does not survive, another attribute may take its place, but with similar attributes, somewhat modified, through market evolution. For as true essence of 'Promethean' capitalism, precisely described as a pure free-market capitalism, fully-consensual free enterprise and exchange for every individual.

 

References:

Aaron, Richard, 1937, John Locke, Oxford: Oxford University Press.

Edward Younkins : Capitalism and Morality  

Richard M. Weaver: The Ethics of Rhetoric

http://www.promethea.org/Misc_Compositions/TextVersions/text_PrometheanCapitalism.html 

http://www.renewamerica.com/columns/hutchison/071001

http://www.shakespeare.mit.edu/lear/lear.4.2.html   

Stanford Encyclopedia.



2012-07-08
Capitalism and Property as a Natural Right

A right is ‘inalienable’ if its owner cannot transfer it to another, by abandonment, gift or exchange. In general, property rights are not inalienable: markets work because of trade, i.e., because property rights are alienated. Some defenders of open markets do claim that some property rights are inalienable, usually ‘self-ownership;’ but others (including Walter Block) deny that.

I am not sure what you mean by an unrestricted right. Most people seem to hold that property rights may be overridden by other values in some circumstances. That makes me queasy, unless the circumstances are exceptional (I explain why in my paper ‘Why Universal Welfare Rights are Impossible’ in PPE).

From the quotation you give, it sounds as if Nagel and Murphy think that property rights are creatures of positive law. Whether or not that is the view they are espousing, it is false, as a great deal of research has shown. Property rights evolved out of human interactions; and behind this evolution lay a predisposition of humans to understand their social world in terms of property rules. This insight goes back at least to the Scottish Enlightenment (Ferguson, Hume and Smith) and was developed and defended by Hayek and others.


2012-07-08
Capitalism and Property as a Natural Right
Please notice that strict liberalism or laissez faire capitalism does not need any fondation in "natural rights", "lockian proviso" or "fair proceduralism". Is property a natural right (Locke), a bunch of rights (Armen Alchian), or an exclusion principle (Buchanan) ? A libertarian-humian critique of lockian style defense of capitalism can be found in several books wrote by Anthony de Jasay. He insists on the conventional characteristic of justice and property, and its hability to coordinate a very large of individuals behaviours without politics and moral bias. De Jasay is first a logician, then an economist and a philosopher who can interest you (especially on his critical approach on contemporary contractualism).
cordialement,

FM 

2012-07-08
Capitalism and Property as a Natural Right
It is useful here to distinguish between corporations and individuals.  Corporate capitalism is an extreme form of state capitalism, since corporate charters are granted by the state which, in turn, intervene into normal market processes to prohibit controls over production by competitive advantages.  The corporate individual is a legal stipulation denoting access to the court system for the defense of institutional interests.  Because the term "individual" is used more comprehensively to refer to individual people, consumers, investors, etc., it must be sharply distinguished from the narrow, legal usage applying to corporations.  Any free-market advocacy which does not take this distinction into account results in fact in the recommendation for an anti-labor corporate feudalism, which eliminates regional protections for small businesses, accompanied by characteristic attacks on federal regulations, liberating the larger private entities to absorb production surplus from regions and communities.  Distribution of a part of surplus-compensation through the mechanism of progressive taxation is one constraint on such efforts which functions to benefit the public sector.    

2012-07-09
Capitalism and Property as a Natural Right
"My income could be regarded as a resultant of two components, namely, the income I would have had under the 'natural' system of property rights less the reductions due to government interference"

Well Danny, you *could* think of your head as a turnip, but you'd be wrong about that too.  I think.  *Obviously*, your income is also the resultant of at least one or two more components:  1) the *increase* in income above any "natural" system of property rights given by the increased security that government offers over the state of nature, which facilitates many more opportunities for people to interact profitably with each other with reduced fear of being taken advantage of and having to go through costly assessments of each person's trustworthiness and/or individual pursuit thereof when they screw you.  Knowing that I can call the police *anywhere* (police who are generally answerable to democratically-elected officials who tend not to get reelected when there's fixable social unrest) whenever I run into such behavior, saves me a *lot* of time when I walk down the street, or go shopping.  You too, you just ignore that and apparently pretend that this is all "natural."  Try walking with cash down a road in Somalia and report back to me from there, if so.  2) the income you *didn't* have to spend on costly infrastructural needs to support your economic and other activities, because they can be provided far more cheaply as public goods.  I once lived in a town with multiple private garbage services; you could contract with any or none, as you saw fit.  Their prices were all uniformly higher than in any other city where this was a city service, because they each had to pay for transport across redundant routes, where a city service can optimize the routes.  Plus the confusing nature of the situation provides opportunities for free riders--I know, because I was one; when my trash volume was low I dropped my service for several months, and my old provider still picked up my trash now and then because the pick-up men can't afford to keep perfect track of who's on and who's off (and perhaps I put a small amount in a neighbor's bin once, my memory is hazy).  Trash collection is a natural monopoly; justice, of course, is another, as are road networks, etc.  1 is really a version of 2, then, but important enough to be treated separately.


Again, if you disagree, and think your income and your neighbors' would increase wildly and multiply beyond limit if only the damned gummit would get off your back, go to Somalia and write us from there, but if you want SEALS to save your ass when you get an AK-47 in your face, leave a forwarding address and a deposit to pay for the rescue.  Then I *may* start taking you seriously.

2012-07-28
Capitalism and Property as a Natural Right
Yes, certainly, if you *define* your income that way, you get that result. On the other hand, if you wanted to demonstrate that your income *really* is made up of just those two components, you'd have an awful lot of work to do, especially considering that historically societies with states show far, far higher average incomes that stateless societies.

2012-07-28
Capitalism and Property as a Natural Right

The 'natural' system of property rights does not refer to the mythical 'state of nature.' In Adam Smith's 'system of natural liberty' it meant a limited state; in Nozick, it would be a minimal state though, admittedly, one which evolves (or 'as-if evolves') from a state of nature; for Murray Rothbard and David Friedman it involves open-market protection agencies. In other words, it does not imply an absence of law-enforcement.

The failure of governments to provide effective law-enforcement is well-known. In the US and the UK many businesses and communities employ private security services, and on some working-class estates in England, residents band together to police their own neighbourhoods, because the state-provided police do not protect them (despite the fact that those people are forced to pay for that non-service through their taxes).

Other public goods can be provided on the market too. We just need current public spaces to be privatised, then their private owners will compete for clients/customers by offering attractive and innovative forms of regulation and 'social' services, including garbage collection. The competition between different providers will drive quality of services up while keeping prices down.


2012-07-28
Capitalism and Property as a Natural Right
I would agree that if both systems exist together capitalism will probably win because it basically drives itself in an effort for profit while communism requires more work to maintain because the benefit is not  necessarily to the person working but to everyone.


private label supplements

2012-07-28
Capitalism and Property as a Natural Right
Well, that's inconsistent with what you implied what you said "...the 'natural' system of property rights less the reductions due to government interference in that system. In that case, all I have to thank government for is making me poorer."  You didn't say "making me poorer, albeit providing Lockean minimal law-enforcement."  Forgive me for naively assuming that when you used the word "natural," you mean, ahem, "natural," and not "state-protected," given that you didn't say so.  Of course, your latest message suggests you don't even think that states do even that effectively, so that makes it doubly odd that you expected me to read your mind and read "given state-provided law enforcement" between the lines in your earlier message, since you didn't really mean that, either.

Apparently, then, you were only seeking a thin logical point to focus on so as to completely ignore the facts I presented about public goods earlier.  Boring.  When you're back from Somalia with a positive report, let me know.  You'll find, I think, that the state of nature is far less mythical than your scenario of happy competition between private security services; indeed, it is precisely what the latter inevitably degenerates into, about as quickly as the Higgs Boson.

2013-06-24
Capitalism and Property as a Natural Right
Danny, you must have missed the part where he pointed out that all income gained is gained within a polity whose regulation, even if it only consist in law, order and defense, enables your income in the first place.  To claim that government provided roads, communications networks, contract enforcement, and market regulation, just to name a few things that enable capitalist economies to function at all, have no enabling effect on your income is absurd.  If you disagree, I suggest you experiment with the idea by attempting to make a living in rural Afghanistan or Somalia which more or less represent anarcho-capitialist states at the moment: no regulation, no public services, no enforceable laws.
Thus your income consists of three components, namely, the income you would have had under the 'natural' system of property rights, plus the increase made possible by government services, regulation, order, security, etc., minus the taxes the government has charged you for such conveniences.  I think that in most cases you will find that you're better off taking the roads and the enforced laws.

2013-06-24
Capitalism and Property as a Natural Right
Hi Luke,

I think my point was that regulation need not be government regulation. Non-government regulation preceded government regulation. Even now, with lots of government regulation, there is also much more non-government regulation. Every organisation sets regulations for its staff, its customers, even its investors. Probably every householder sets the rules to be followed in his/her house (whether he/she owns or rents). But before anyone can 'legislate' rules, there must be unlegislated rules (evolved conventions) which make social co-operation (and thus persons) possible. Of course markets require regulations; but markets developed, and still do develop, without government regulation. Roads, for instance, were not originaly provided by government: they just emerged from people following in each other's footsteps. Roads do not need to be provided by government now: they could be privatised, with regulations for them set by their new private owners, who charge people for using them (we have the technology to be able to charge people for the amount of road they use and the times of day at which they use it, thereby using pricing to reduce snarl-ups).

2013-06-24
Capitalism and Property as a Natural Right
Hey Danny, go ahead and privatize the air, giving me the right to sue for invasion of my oxygen rights.  I will then charge you 1 trillion dollars for every oxygen molecule you (or industries you benefit from) turn into carbon dioxide in every breath I take, as a shortfall from what I would otherwise have breathed in.  You think that's too much?  Too bad; you don't get to decide that anymore.  Now that my air is privatized, any imposition upon my oxygen rights on your part is a Randian "initiation of force" from which, I understand, I get the right to defend myself with maximum retaliatory violence as I see fit, including expropriation of all the offender's possessions.  I now get to veto (or own, if I so choose) modern industry, and so does everyone else.  Reductio ad absurdum of your position.
Or wait: are you only going to privatize *some* public goods, and not others?  On what grounds? Can't wait to hear this one.

But since you didn't respond to my empirical evidence regarding market failure in garbage collection, except by repeating your faith that markets will always be efficient, I don't expect you to address the specifics of this argument, either.  Of course, until you actually address the opposing evidence and arguments people like myself, Luke, and damn near everyone else is offering you, you're not only wrong; you're boring.

2013-06-24
Capitalism and Property as a Natural Right
Actually, given the pattern of your past responses, I predict that you are most likely to say "what I meant/said was..." and then state something that you didn't say before, and perhaps even contradicts it; as you've done twice.  Look up Aristotle on the law of non-contradiction and plants before trying this again, though; I already have enough vegetables in my fridge, and don't need to meet any more online.  :-)