Property Rights Foundation of America®

Speech from the Ninth Annual National Conference
on Private Property Rights
(2005)

PROPERTY LAW TODAY: The New Feudalism
By Peter F. Blackman
October 22, 2005

I am honored to be here speaking before many of you, and I am excited because I see the opportunity of the property rights movement to emerge from the shadows and margins. Many of you have toiled heroically for this movement, with little promise of gratitude. Your efforts have sometimes incited the loathing of the mainstream media, and perhaps worse, the complete indifference of members of our society about what they have at stake.

I count myself as one of those who was oblivious to the dark cloud hovering over property rights. I have paid dearly for my complacence; I hope to spare others from similar misfortunes. My epiphany is from my experience living under a so-called preservation easement held by the National Park Service. That easement, in its terms, covered elements of architecture for my home. The fact I had this notice of the easement when I bought the property has been the single argument the Park Service has used against me, meanwhile itself ignoring the standards of review stipulated in the easement document, a standard that was actually consistent with what I wished to do with the house, and they applied their own separate standard which directly contradicted the easement document. Over details on an old house that sits three-quarters of a mile from a road, over plans the government itself admitted in open court were beautiful, their objection to these plans being that these plans were too close to the style of the original Greek Revival house, the Park Service has not only sued me, but also attempted to criminalize me for remediating toxic mold and correcting urgent structural problems, both of which they did not contest in a prior hearing a year ago. There was a hearing this September 16th on whether I should be held in criminal contempt for an alleged violating an injunction which — I do not make this up — forbade restoration but permitted repairs. Good luck figuring out the difference between the two words — the judge gave no further guidance. Five weeks later, the judge has yet to announce a verdict. An example of the absurdity of the government's position in this matter is their contention that my putting a half-inch plywood barrier on the house would fundamentally alter the historic character of the home, even though the plywood would not visible when siding lies over it and it is a standard, code recommended protection that nowadays is universal in construction.

But since my case is still very much alive, it is best I not tarry on it. Instead, I thought I would share some ideas I have developed about property rights through the scalding forge of hard experience. My thoughts relate to the challenges facing us believers in property rights, the centrality of property rights in the bundle of human rights and freedom, why property rights are our best protection against governmental abuse and the particular significance of land in the property rights scheme.

I am a relative newcomer to property rights, and so I do not suggest that these are ideas that have not occurred to many others before me, or to you that are passionate enough about property rights to attend this symposium. But, just as so many people take property rights for granted, and that is one of the stumbling blocks all of us here must contend with in the outside world, I think there may be a tendency for us to be so sure of our own convictions that we do not think about how we might articulate them to convert the skeptics and naysayers out there. Let there be no mistake: if we are to be successful, we will have to do a lot of converting.

I realize that the arguments in this speech may have the arcane airiness of philosophy. I expect other speakers to provide us with a Grand Guignol banquet of horror stories. These examples are potent ammunition — they represent the ills that we are here to fight. But storytelling will not alone carry the day. For us to increase the likelihood of real reform, we would be wise to back our efforts with a compelling philosophic framework, one with wide application to varying scenarios. Our opposition can be counted on to invoke large principles of social justice or societal good. Their statements may be vague, sloppy, and speculative. Whatever the shortcomings of their arguments, they have worked until now. That means we have to try harder and do better.

The perennial problem for the property rights movement has two dimensions: one, it must contend with what might be called a theology of equality, and two, and not unrelated to this first dimension, the voices of property rights have been scattered and disorganized. A thorough discussion of the theology of equality is beyond the scope of this speech. As you can surmise, I refer to the way the term democracy, from its origin as a form of government and a political culture, has morphed into meaning social and economic equality. When such objectives are stated in a vacuum, without competition from other values, they may seem entirely laudable. Thus have some of the worst demagogues this planet has ever known appropriated this theology for their invidious ends, leaving a wake of stunning destruction, all for a dubious equality at that. Yet despite an ignominious history, a platform of equality still can have a narcotic effect on folks oblivious of history. One should not ignore how the mantra of equality put us, the proponents of property rights, on the defensive, at times, paralyzing us.

Unfortunately for us, the huge societal benefits of property rights are ones that play out subtly, gradually, and counterintuitively. A society's accumulation of wealth may hinge on the degree it honors property rights, but what most people see is the inequities that exist at any given point in time. Can ordinary citizens not engrossed with issues of political economy understand the connection between property rights and prosperity? I would submit to you the answer is yes. Most Americans had no illusions about the monstrousness of Communist regimes that was part and parcel with their attempts to outlaw property. By the same token, it may not occur to most Americans that a milder subversion on property rights has gone on in our own backyard, or that there could be negative repercussions as a result of the sundry attacks on property rights.

Such ignorance can persist because most people do not directly bear the brunt of infringements on property rights. The most egregious of such incursions against property owners appear isolated. Take my case: most people don't live under a preservation or conservation easement. They can reason, the buyer deserves the heartache for buying into such a situation.

The Kelo v New London scenario is more common. You will be hearing a lot about Kelo today — which is the recent Supreme Court decision allowing New London to condemn the land of holdouts in a waterfront neighborhood that the city wished to have redeveloped with condos and retail establishments, all to be held privately. Yet even in the Kelo scenario, in which a whole community might be uprooted, the majority of the populace does not suffer. New London's justification for its sweeping taking of private residences was, in essence, slum clearance. Affluent neighborhoods don't need to be redeveloped in most people's eyes. I don't think the residents of Greenwich, CT. are going to lose sleep at the possibility they may lose their homes to make way for new condos or malls. Slums and working class neighborhoods are often ugly and gritty. To the better off, the removal of perceived blight and disbanding the gangs and dens of thieves who skulk in these neighborhoods seem an unalloyed good. It doesn't occur to them that displacing a whole community is no way to combat poverty. By the law of unexpected consequences, the likely effect is the reverse, by depriving the displaced of what stability might have come from a community. As to crime, the result is but to disperse it.

As Kelo typifies, attacks on property rights are usually made against folks financially ill-equipped to fight back. Even when the victims have greater wherewithal, they are probably encountering an once in a lifetime crisis. Not so, their antagonists, government bureaucracies. We're all familiar with how government agencies make it a mission to protect and enlarge their turf. In this quest, they tend not to be inhibited by the impact on other arms of the government, let alone society at large. Steamrolling over private property rights are certainly not going to cause them much heartache. Government agencies may be mismanaged internally and ineffective at carrying out the supposed function for which they were first created, but when it comes to growing their organization, they do not waver, they do not flinch. These agencies, moreover, have allies, powerful allies, in some large corporations and nonprofit groups, collectively, NGOs, who will provide cover, spin, propaganda, and do whatever would be unseemly for the government agency to do itself, perhaps because of statutory restrictions. In concert, the government and its private sector co-travelers will come at the individual with the remorselessness of a tsunami.

Most folks in our society probably do live under some kind of zoning, which is a close cousin to the sort of easement I am subject to. And the trend in zoning since 1926 when the Supreme Court upheld restrictive zoning in the Village of Euclid, Ohio v. Ambler Realty Co. case is towards ever more fickle rules, arbitrary enforcement and more emboldened micro-management of human activity, with towns decreeing such things as the vehicles you can have parked on your driveway or the size of flags you can display in your yard. Yet generally, the victims tend to be alone. Other members of the community, even if they don't approve of the persecution of the victims, want to do everything they can to steer clear of governmental and community wrath, and so they will not dare to stick their neck out to assist a neighbor caught in the cross-hairs of the system. The typical reaction, of course, is that this neighbor is to blame. Few recognize that the system depends on a steady diet of human sacrifice. You see, the system is ultimately about power, governmental power. But to clarify this power, to legitimate it in the eyes of a community, there must be people who are squashed at its altar. It is no accident that the rules become increasingly insensible and contrary to ordinary human wants. A community does not need a rule to have property owners to keep their house in good repair — most homeowners have sufficient incentive to do this anyway, and a rule in the rule book is probably not going to induce the slothful to act differently. But to say that homeowners can't have a doormat or they can't linger on their front stoop — such perverse rules lure free-thinkers into defiance, and brings peals of joy to the power hungry salivating at the opportunity to crush them.

Other incursions on property rights include forfeiture laws and the vast panoply of regulation that restricts how a person can conduct business on his land. All of these are things which could befall almost anyone, but the typical citizen gives these eventualities no more thought than the average citizen of New Orleans a week prior to Katrina. It is our job to stir them out of complacence and show them what's at stake, even when they are not personally mugged by the system.

What I see as the common thread of all of the property rights issues — my situation, the inappropriate expansion of eminent domain, and the other assaults on property rights — is one thing: the heavy hand of government.

Is government inherently evil/corrupt? I don't know. Is an unfettered government prone to evil/corruption? Absolutely. A lack of institutional and cultural restraints will invite abuse with the inevitability that drinking contaminated water will induce illness.

In our society, there has grown an assumption that government is an instrument for the cause of good. People trust government to correct the shortcomings, gaps and inequities of the private sector. One can even say critics of big government accept the general proposition when it comes to actual policy-making. This is not the time to examine the veracity of state benevolence. The point here is that there is scarcely an invasion of private property rights not carried out under the pretext of governmental paternalism.

Let's assume for now our government has historically had a net salutary effect on people's lives. I would argue that that owes much to the limits our government has had placed on it. As the government's participation in our lives becomes more expansive, its conceit of being a positive force loses plausibility. Its ability to regulate itself becomes strained with increased size. More decisions are in the hands of people who do not suffer the consequences. The effects on culture I will touch on shortly. When its relative size is small, government has all it can handle carrying out its original function, which is to protect private property. It may be a subject of philosophic speculation whether government as an institution first arose for this purpose, but there can be no doubt that that was uppermost in the minds of the framers of our constitution. It was concern over property above all else, the protection of it against perceived depredations of the crown, that actuated our founding fathers. There is no clearer statement of that intent than their imposition of a property requirement for voting.

Property is the bastion of the individual, his ramparts against government intrusion. A respect for private property in a society gives the citizen the resources to defend himself from that society and the excesses of government. Ask yourself, which gives an individual more power over his own life — one vote out of two hundred eighty million Americans to decide on our President, or having a meaningful dominion over his own property? Be someone a loathed leper, the rest of society can not deprive him of his property in a system that respects property rights. Our government is characterized by a system of institutional checks and balances among its three branches. These checks and balances would amount to naught without the ultimate check and balance on our government — private property rights! Property rights ensures limited government. Does anyone think that government, left to its own devices, would have the discipline to rein itself in?

It may seem a paradox that a small government can be the strongest government, a large one, a lumbering invalid. Citizens with property have a stake in the stability of the system, it is worth remembering.

Most people do intuitively understand some relationship between property rights and a robust economy. We need to hit home just how strong this relationship is. But I would add a word of caution: to accept the utilitarian school of thought that property arose simply to allow a more rational allocation of resources is to concede that property rights could be negotiated away. Utilitarians are no friends of property rights. Their formulation coldly disregards the historic concern with liberty and individualism that was the impetus for property rights. Still, property is the bedrock upon which all incentives to create wealth, and not merely subsist, accrue. The development of civilization can be measured by the treatment of property as much as the progress of law. Indeed, law and property rights are in many respects an unity. Great philosophers such as David Hume, using logic, speculated that the institution of law arose specifically to protect property. Property only has meaning when a desired or necessary resource is scarce. No one asserts dominion over air, for example. Without scarcity, there would be no conflict, as everyone could have as much as they want of something. Scarcity, however, leads to conflict, and with conflict, sometimes violence between men. Law arose to deal with conflict. Without conflict, there would be no need for law. So one can see how property rights and law are in many respects one and the same. Only through law is property recognized and protected.

Because property only matters when there is scarcity, we must resist arguments you sometimes hear to justify government meddling along the lines that some type of property is too valuable to leave to the private sector's control. It is precisely in such a scenario that property rights is most efficient in a society's ordering of its resources.

There is a tendency among those championing various liberties to focus on one pet liberty. There is the first amendment, free speech crowd, the non-establishment of religion crowd, etc. It may be fine for their agenda that these other groups concentrate all their energies on their single field. While all liberties do ultimately collide with other values, I do not think that free speech has an image problem. It has good P.R. Property rights is not so blessed — it elicits ambivalent reactions, as well as confusion with personality traits frowned upon. Therefore, we have a burden of proof, but one that we can ably meet, to show that not only are property rights consistent with these other human rights, but that property rights are critical to them. Property rights should not be cloaked in partisanship. Both parties should be able to ably meld property rights into their program. Let their competition with one another be over how best to promote property rights. But that is unlikely to happen, I believe, if property rights advocates are overly narrow in their agenda.

Now, if I may briefly switch gears and talk a little about the property underlying property rights. Property is a very elastic concept — to many people it refers to the material object, but actually, a more precise usage refers to a person's relationship with that object vis-a-vis the rest of the world. As to the object, besides physical things, property covers intangibles, such as copyright and other intellectual property. Our country's founders considered even human rights, such as freedom of speech, as property. James Madison wrote, "As a man is said to have a right in his property, he may equally be said to have a property in his right." This makes sense, especially if one is strict in applying the term of property to the relationship of people to the object, for then there is a parallel analysis between abstract rights and physical objects. The right to speak one's mind, for instance, only has meaning in a social context. No authority can possibly enforce a restriction on speech of a person alone in the wilderness as long as there is no means for the authority to control actual thought. So if logic supports the wisdom of Madison that all human rights constitute property, is that not a powerful argument that property rights sits at a pinnacle of all human rights? Mind you, this does not proscribe any and every limitation on property, whatever the form. But it should surely suggest that property can not properly be removed from the portfolio of rights.

It has often been posited that property rights are essential for the other human rights to flourish. The catastrophic experiments with Communism behind the Iron Curtain offer definitive proof of this proposition, and yet property rights are as under the gun as ever. Why is it, you may ask, property rights and other human rights go hand in hand? The antithesis of property rights is state or communal control. Then every decision regarding a country's resources would rest with the state. If such a system begins by tolerating dissent, its liberality can't last long. Every decision would become politicized, leading to complete paralysis. The temptation of those who control the state, and with it, all resources, will be overpowering to crush pesky dissent. Further, as the repository of all resources, they will have the means to do so. That is the Communist model. Now let's assume instead a system in which property rights were honored but dissent is not. That is what people loosely associate with Fascism. Without dissent, the ruler, who himself enjoys free speech, will have no constraint to do as he wishes with regard to all the country's resources, regardless of nominal ownership. It will soon be irresistible for him to snatch what he wants, when he wants it. So it was in Nazi Germany. It is a fallacy that the Nazis respected property rights. A regime that expropriates the property of millions, not to mention their ultimate possession, their lives, and reserves the right to do so with respect to anyone that falls out of favor, is not a shining example of property rights.

As strong a case as one can make for human rights as a property right, it is land, or real estate, that most peoples understand as at the heart of the property rights movement. Land is the source of most of the pressing property rights issues. No other form of property has so vital a role in our personal liberty and freedom. First, I would point out the obvious: land is how countries define themselves, and it is what governments were originally set up to protect. As integral to the concept of sovereignty, it is a type of property of especial pertinence to a government. It is also one form of property which an owner can not conceal or remove from a sovereign's grasp, as he can much of personal property. For these reasons, land is more susceptible to taxation and to governmental regulation. Governments, as entities defining themselves in terms of land, and doing so as much today as yesteryear, conceive of much of their regulation, whether an exercise of police powers or guardians of public welfare, in terms of land.

The importance of land to individual autonomy is expressed best with the maxim, a man's home is his castle. In your home, you rule. Barring extraordinary circumstances, the state can not invade this sanctuary. You can invite or exclude whomever you wish there. If someone takes away a piece of your furniture, you may suffer some discomfort and a loss in wealth equal to the item's value. If land is swept from under you, you lose not only what is probably your most valuable asset, but also, your most integral connection with the earth, your home, and your dignity, and finally, the one place where you could aspire to realize your fullest self, uninhibited and untrammeled by the wishes and whims of others. Ah, but what about renters? They, too, benefit from the culture instilled with property ownership. They can effectively enjoy the same sense of autonomy and self-governance only because that individual has the legal right to own. Deny him that potentiality, and he is somehow less equal psychologically and almost certainly in his ability to make decisions for himself. Property rights, in other words, contributes to a culture of individual responsibility and rewards.

The importance of property rights in land is as true, maybe even truer, today than it was in earlier times, because a far greater percentage of us live in a densely populated area, and so it is harder than ever to escape the rest of humanity. So you see, the distinction in the law between personal and real property may not be a mere anachronism, as many legal theorists in the academy like to put forth. We must resist such insidious arguments.

Land was at the center of the feudal system that characterized much of Medieval Europe. And yet one should not think the continued importance of land as a feudal holdover. The importance of land to an economy, as the source of much wealth, arguably all wealth, is an incontrovertible reality, and will remain so as long as the planet Earth remains our home. One should not disparage feudalism's historic value; it served Europe well for several centuries. Yet the dismemberment of the system was vital to the advancement of European civilization, for feudalism did not know property in the modern sense. To simplify things somewhat, no one owned his land but the sovereign, there was a blur between the private and public realms, and every bit of land had a complicated web of relations that affected how the land was treated under the law. It was generally exceedingly difficult, if not impossible, for the lord to sell his land. It is in these aspects that I was going to speak about the new feudalism, but time will not allow. The one point I would make, however, is that land is one form of property that having an enforced simplicity to the legal relationships, such as the common law preference for fee simple absolute, was immensely liberating, enabling for a far greater diversity of economic activity to blossom.

Now this discussion of land may seem a digression, but nothing better illustrates the virtue of property rights than how it affects land use. The greater the role of government over questions of land use, the more politicized everything becomes. What could be more unwieldy than the political process at making optimal economic decisions?

Has government shown an aptitude for coming up with ideas of what is best for us? Is it not our own experience that ideas tend to percolate a long time in the private sector before the government even takes notice of them? Add to that that the state is notoriously slow to adjust to changed circumstances, bar a catastrophe. I don't think we want to wait until a hurricane or earthquake to take steps to shield ourselves from their effect.

To conclude on a hopeful note — Kelo may have a silver lining, for it is so disastrous that it may finally allow the voice of reason to be heard. Property rightists have been treated as marginal, crazed zealots, our views, extreme and selfish. Selfishness has been the cross by which those wishing to abridge property rights have sought to crucify us from time immemorial. They profess to act in the interest of the public good, a public good that they so kindly define for us, a public good that coincidentally, promised to increase their organizational, bureaucratic interest, which generally amounts to mindless expansion. And yet, as Kelo has made plain to the masses, the supposed public good can be a cover for the truly selfish interests of a small group of developers. Kelo provides an opportunity for the property rights movement to assert its legitimate place in the marketplace of ideas that supposedly fuel our system of governance.

The fight for property rights remains a heroic one. It is an uphill battle. When you fight for your own rights, you are fighting for those of all of us.

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