The Nature of Property Rights: Personal, Private and Public....

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I have been reading a lot of political economic theory lately.  Mostly Libertarian Socialist.  But it has gotten me thinking about the nature of property.   Sort of a little "hobby" of mine.  So I have been reading various textbooks, case law, and a little book by Proudhon called "What is Property?"  Some of you may have heard of it.  It is, unfortunately, not something you sit and read on a sunny afternoon, but something you read a page or two at a time and then try to assimilate. 

The first thing I did, even before reading a page of Proudhon's book, was to look for definitions of property. I turned to a hornbook where I read that “[w]hen an individual claim or interest receives recognition and protection by the state we say that the party concerned has a legal right in the matter under consideration.” So, for instance a right to be free in the possession and enjoyment of someone's land and chattels. The correlative is that there is a legal duty. Brown, Ray Andrews, The Law of Personal Property, Second Edition, ©1955 Callaghan and Company. p. 2.

“Legal rights are, however, not static things, but they may be created, transferred, and lost. This capacity in an individual of creating, transferring, and divesting himself of legal rights is known as a legal power.” Id., p.2. A person may have a legal power, but no right, as in a thief. But this still does not define “property” itself, but rather describes property “rights”.

Such legal rights have been divided in personam and in rem. Id., p. 3 In personam is a right which exists only against a person. p. 4 In rem is available against persons generally. p. 4. In personam, the correlative rights exist only with respect to a certain class of persons. With in rem correlative rights exist in persons generally. Again, useful ideas, but not a definition. So I delved further and did find the following:

In the popular sense of the word property is often used in reference to those tangible things, which are subject to the rights, which we designate by the term ownership. A man's property we say consists of lands, buildings, furniture, cattle, wagons, automobiles and the like. In the legal sense, however, property means not the thing itself, but the rights which inhere in it. Ownership, or the right of property is, moreover, nor a single indivisible concept but a collection or bundle of rights, of legally protected interests. The owner of a given piece of land or chattel has not only the interest of possession, and of enjoyment and user, but also that of transfer to another, and even of directing how it shall be disposed of upon his death.

Id. p. 6. Now, this truly is a definition! However, it is an interesting one because it does not define the thing itself, but rather the thing by our relationship to it. Sort of an “it's property because we say it is” type of definition. In fact, under this theory, you could own all the property rights and not a stitch of what any layperson would call property at all. And many people do.

The definition and concept of property is obviously more complicated. “Certain physical things, such as air, light, and running water are by their very nature incapable of being owned. It is impossible to exercise over them that power of exclusive control which is the very center of the concept of private property.” Id. p. 7. Looking at a hornbook on real property law, I found even less explanation of property. Rather there was a gradual presupposition that everything came from God, passed through the divine right of King's through their fall, through barbarian rabbles and came out the other end of a feudal system wholly intact.

Having said that, two concepts are worth repeating. First, “Proprietary rights in land are, we may say, projected upon the plane of time. The category of quantity, of duration, is applied to them.” Moynihan, Cornelius J., Introduction to the Law of Real Property, West Publishing Company, 1962. The second concept is how the philosopher Cicero (at least according to Proudhon) compared the earth to a theater. Each person is accorded a seat and holds that seat while they occupy it. When they leave it is free for someone else to occupy.

These statements hit upon an important truth.  There simply are different types of property with different qualities.  A tautology that can be quite helpful.  The real question is not whether there is or is not property.  Obviously there is some sort of property.  Different forces work upon different types to make them property or to cause them to retain value as property. It appears the definitions of property may change depending on the “plane of time” or how many seats are in the theatre and how many people want to see the show.

Proudhon seemed to think there were two different concepts:  private property and personal property.

There most assuredly is some sort of personal property.  My clothes, my house, etc.  These are - more or less - inviolate.  We as a society simply frown upon people ripping other people's clothes off.  No matter how outlandish they are.  And given the way many people would look without clothes, I can support this. But I have also learned that just because I possess something cannot be a basis on which I own it.  Otherwise, I would simply need to steal something to appropriate it.  Otherwise, I could own a person.  Last check, society still frowned on owning people.  In fact, in some circumstances we frown on "renting" people, owning some animals, owning some substances, etc.  

On the other hand, we discuss PRIVATE property also as a type of property.  So you can "own" land you have never seen and never visited.  It is possible you don't even know you own it, as you could have "purchased" it as part of an investment. It seems simple possession cannot be the basis for property. Perhaps put in a more modern context, you own what you create.  Again, to some extent this is obviously true.  I have created this text, I have created the thoughts, I "own" this.  I guess I could take ads and "sell" space, or try to copyright it as intellectual property.  I have done none of this.  But by the same token, what right have I to sell space on the sheet of paper (or the webspace) where you are reading this?  I created the text, but not the medium.  I did not create the computer on which I write.  These ideas are mine, but they are spawned by what I have read.  Nothing exists in a vacuum.  So if everything and everyone contributed to this blog - this so-called property - then everyone owns a little piece of it.  And if everyone owns it, then NO ONE owns it.  

Yet, as a society, we protect these two types of property equally. 

But should we?  Of course, no one should take your home.  But if you simply are not making productive use of something and someone else needs it, or can make productive use of it, then what is the purpose of protecting your inchoate interest?  Protection of such an interest serves only to perpetuate the tendency of money to make money, but serves no useful purpose to society other than to increase capital.  In fact, it could be argued by taking away the ability of someone else to use the property, we have actually decreased productivity. 

Do not take this question as meaning that all retirement savings or other investments should be socialized or that private property should necessarily be abolished.  The aggregation of money for investment is extremely important for large projects and can serve the public interest. 

However, is it not also possible that we should recognize the distinction between what is essentially a human need for personal property that is inviolate and preserved to them as the fruits of their labors and the private property that is nothing more than property as exists on paper?  Such a distinction could have profound impacts on the way we view the environment, agriculture, energy, and all consumer goods.  I don't suggest an answer, but let's have the debate.

There is a false and mistaken division between private and public property in the United States today.  There is also a lack of respect for personal property.  This false division and lack of respect leads to a flaw in society.  A small number of self interested individuals make a lot of decisions for a large number of individuals about what is best for everyone.  By understanding (and perhaps abolishing) the "public versus private" distinction, we can start down a path of reinventing our society and decision making to benefit all persons.

My research indicates that laws and governments - states - spend a lot of time "protecting" private property.  In many cases or places, this is defined by its juxtaposition to "public property".  In this definition, public property is that which is owned by the state, and private property is everything else.

Following these definitions, the Complaints of the Declaration of Independence and the protections of the Fifth Amendment to the United States Constitution look as if they are meant to keep the state from "stealing" someone's property.  Indeed, that is a true statement.  However, it is far from the whole story.

In thinking about property (personal, private or public), we need to start earlier and from a different perspective.  To a large extent, prior to the Magna Carta all property was owned by the king.  I recognize this is a gross exaggeration and that there are numerous examples where this was not true.  However, this is a useful place to start.  The Magna Carta essentially granted rights, or "property", as that term can be loosely used away from the king, while retaining certain rights, or "property" in the king.

Now, there is an interesting characteristic of property that everyone knows and everyone forgets.  Property owns you.  While you "own" something, you always have some sort of obligation, whether it be a tax, maintenance or simply finding a place to store the property.  And, of course, you always have the risk of loss.  After you give property away, of course, you no longer own it.  So the peculiar thing is that the only time you actually exercise all the rights of property that you may have is at the particular time you give away those rights.

That bears repeating:  only at the time someone actually disposes of their property is that person taking complete control and exercising all the property rights they own. 

Taken one logical step further, the best of all possible worlds would be to give away the (property) rights, while still maintaining the ability to direct the use and management of the (property) rights.  The king knew this when he put his seal on the Magna Carta.  The Barons that forced the Magna Carta did not get freedom from the king.  The state knows this when it allows you to "keep" your property free from taking for public use without just compensation.  On a personal level, the parent who "gives" a car to their child to drive to and from school and work, and nowhere else, practices the same type of control.

So let's use this concept and redefine public property.  Public property is not just the property "owned" by the state.  Indeed, ownership by the state is not nearly so public as one might think.  The ownership or use of the property is limited by the owner - the state - not the public.  Public property is, rather, the whole of the rights that the public has.  This includes positive rights such as traditional deeded ownership of land, as well as negative rights, such as the right to zone, or set a speed limit.  Let's also do away with the idea of the state "owning" these rights.  While modern law seems to treat that as true, I am proposing that is the wrong way of looking at things.

The King gave way to Parliament in England.  However, in the United States the King gave way to the people.  In fact, in the Commonwealth of Pennsylvania, the rights have been protected by the Commonwealth as if in Public Trust.  The Pennsylvania Constitution essentially gives the people rights which - most rightfully - should be public property.

So then, private property is everything not owned by the people, right?  One certainly can make that distinction logically.  However, there is another more fundamental distinction at play.  Since so many property rights are subject to so many rights of the public, is there not a third, more inalienable property right?  Did the Declaration of Independence not indicate there were inalienable rights such as life, liberty and the pursuit of happiness?  Can someone take your intellectual property?  You can give it, perhaps without protection, but can they actually take it?

My suggestion is that there are certain personal property rights which are inviolate.   Nor should these be limited to your thoughts.  Life, liberty and the pursuit of happiness come to mind.  The clothes on your back should be your personal property, subject to no one else's right to remove them.  Of course, the line gets blurred, but generally the fruits of your labor should be yours.  You create it, you keep it or dispose of it.

However, all other property, including the money received if disposing of personal property, and no matter whether "private" or "public", is simply property.  Again, all other property, whether "private" or "public" is simply property.

It is neither good, nor evil.  One property right is limited by another.  In a society, one in which presumably there is a social compact, the concept of correlative rights allows for seemingly incongruous positions on property.  Taxes are an example of incongruous positions.  If your personal property was inviolate, and you sell it, why wouldn't the income be inviolate.  This is because taxes are simply a method of aggregating capital that presumably the public has agreed upon (this is another subject, for another day, but remember that whole "taxation without representation" thing). 

So the important thing turns out not what kind of property right we have after all.  The important thing is what we as a society choose to do with these rights.  Right now, much wealth (a form of property) is concentrated in a few holders.  This is not necessarily bad.  A concentration of wealth allows for investment.  What is dangerous is how the decision is made how that wealth should be exercised.  In other words, how and when will it be given away?  To who?  What restrictions will be placed on how that wealth is used?  As a society, we should be wary of  allowing a small group of persons to make those decisions.  Likewise, we still have the same tensions as the founding fathers regarding the tyranny of the majority.  More recently, we need to be concerned about the tyranny of what is loosely termed special interests. 

While I cannot answer specifics as to ownership or wealth transfer or regulations and rules on the use of property (who am I to impose this order unilaterally anyway), I do suggest that people stop thinking in terms of public versus private (and left versus right).  We need to begin to think of "us" and what is best for ourselves and our children.  It is not best for a small number of private interests to make public decisions.  It is not best for the public to abdicate their public responsibility and allow a small minority of persons to hold capital with little, if any, accountability to the public.

Talk with people.  Talk with your family.  Talk with your friends.  Talk with those who disagree with you.  What kind of social conscience do we all agree a large company like Walmart should have in return for the public allowing them to exist and concentrate wealth in a small number of people?  What are we willing to do to achieve this?