Private Property

The Ground of Freedom

The role of private property is a necessary component of home economics. To begin, I would like to consider briefly what some writers from our Founding Era had to say about private property and then quickly trace the idea into the twentieth century. We will see that the idea of private property is frequently understood as a correlative of freedom. Furthermore, any restoration of home economies must be built on a vibrant culture of private property. If so, it may be that revitalizing home economics is an important means of fostering freedom.

Noah Webster—the same Webster who compiled the first American dictionary—was an ardent champion of the Constitution. In the fall of 1787, he published a defense of the proposed Constitution. He argues that real power consists in nothing other than the ownership of property, and he observes that historically “the power of the people has increased in an exact proportion to their acquisition of property.” In fact, “a general and tolerably equal distribution of landed property is the whole basis of national freedom.”[1] On the other side of the ratification debate, an Anti-Federalist writing under the pseudonym Centinel asserts that “a republican, or free government, can only exist where the body of the people are virtuous, and where property is pretty equally divided.”[2]

While serving as minister to France, Thomas Jefferson observed the sufferings of French citizens bereft of private property. In a 1785 letter to James Madison, Jefferson discusses the importance of property. “I am conscious,” Jefferson admits, “that an equal division of property is impracticable.” Nevertheless, “enormous inequality” is the cause of such misery, and the suffering is such that “legislators cannot invent too many devices for subdividing property, only taking care to let their subdivisions go hand in hand with the natural affections of the human mind.” Ultimately, Jefferson voices his commitment to a propertied citizenry: “It is not too soon to provide by every possible means that as few as possible shall be without a little portion of land. The small landholders are the most precious part of a state.”[3]

In 1792, while considering the problem of political parties, James Madison reflects on the problem of inequality in property and strikes a Jeffersonian tone in the remedies he proposes. Madison argues that inequalities can be remedied “by the silent operation of laws, which, without violating the rights of property, reduce extreme wealth towards a state of mediocrity, and raise extreme indigence towards a state of comfort.”[4] It is clear that neither Madison nor Jefferson is advocating absolute equality. Instead both emphasize the importance of a propertied citizenry.

By property these men meant primarily land. A landed citizenry was deemed essential to the health of the republic, and given the broad distribution of land at the time of the American founding, the framers of the Constitution had good reason to hope that, with vigilance, liberty could be sustained. In short, it was generally understood that a culture of private property, broadly distributed, was essential to real and sustainable freedom.

The Property-less Proletariat

In nineteenth-century Europe, Karl Marx focused his concern on the rise of the proletarian (property-less) class and expressed his hope for a revolution that would result in the eventual abolition of property. Marx is sorely mistaken in much of his analysis, especially his prescriptions, but he does get some aspects of the diagnosis right.

First, those who attempt to remain aloof from capitalist modes of production—what we today call “economies of scale”—tend to be consumed. As Marx puts it, “the lower strata of the middle class—the small tradespeople, shopkeepers, and retired tradesmen generally, the handicraftsmen and peasants—all these sink gradually into the proletariat, partly because their diminutive capital does not suffice for the scale on which Modern Industry is carried on, and is swamped in the competition with the large capitalists.”[5] Marx understood that human scale is tied to human flourishing.

The proletariat will tend to expand as property is steadily concentrated. But there are social and political consequences. A decentralized economy comprised of farmers, artisans, craftsmen, and family enterprises is incompatible with an economy built around large-scale production, distribution, and consumption. Thus, “the bourgeoisie keeps more and more doing away with the scattered state of the population, of the means of production, and of property. It has agglomerated population, centralized means of production, and has concentrated property in a few hands. The necessary consequences of this was political centralization.”[6] In sum, Marx saw that economic centralization and political centralization go hand-in-hand.

Furthermore, as the population becomes increasingly proletarianized, it becomes increasingly less independent and naturally enjoins the creation and expansion of a welfare state. In other words, a proletarian society will, perhaps invariably, demand a strong, centralized state that is ostensibly capable of satisfying the demands of a dependent, propertyless population.

Others picked up on these themes. In his neglected classic, The Servile State, Hilaire Belloc argues that capitalism is fundamentally unstable and is therefore a transitory condition. It is important, though, to pay careful attention to his definition of “capitalism”: “A society in which the ownership of the means of production is confined to a body of free citizens not large enough to make up properly a general character of that society, while the rest are dispossessed of the means of production and therefore proletarian, we call capitalist.”[7] In Belloc’s mind, there are only two resolutions to the instability of capitalism. The first is socialism, and the second is what he calls “the distributist state” or “the proprietary state” in which private property, specifically the means of production, is broadly distributed throughout the populace.

According to Belloc, capitalism, as he defines it, tends toward centralization of economic power, but when economic power is centralized, it requires a strong political structure to manage it. Like Marx, Belloc grasps the often ignored truth: centralized economic power goes hand-in-hand with centralized political power. Belloc’s friend and fellow distributist G.K. Chesterton argued that capitalism had come to an end and the evidence was that the capitalists appealed “for the intervention of Government like Socialists.”[8] In light of the cry for a government bailout in 2008-9, it is difficult not to see Chesterton’s point.

Seventeen years before Marx published The Communist Manifesto, Alexis de Tocqueville traveled to America. He encountered a bustling commercial society, where seemingly everyone was intent on pursuing material prosperity. He saw that property ownership tends to stimulate activity, which tends in turn to increase the number of “eager and anxious small proprietors.”[9] The consequence is a steadily burgeoning middle class characterized by middle class virtues and passions, virtues and passions that are directly traceable to property ownership. Tocqueville puts the matter bluntly: “in America there are no proletarians.”[10] In other words, in America, all are deeply vested in the culture of private property.

But have conditions changed since Tocqueville’s visit? In 1948, the German economist Wilhelm Röpke framed his concerns about America in Jeffersonian terms: “It was Jefferson’s nightmare that the peasants and workers who comprised the population of the United States of America at the end of the eighteenth century would become changed one day into a propertyless and nomadic proletariat on the one hand and a capitalistic plutocracy on the other. This nightmare has come true within three generations.”[11] A sobering thought.

A Muddled Understanding

We would do well at this juncture to consider the changing notion of property, and here we can move up to a more contemporary example. Between January 1 and October 11, 2008, U.S. corporations lost nearly $8 trillion—over 40 percent of their value. Personal net worth plummeted. Retirement accounts were decimated. Many Americans were forced to reorder their lives to compensate for this dramatic loss in wealth. Many more were forced to confront the hard truth that their wealth was far less secure than they had imagined. Although the economic disaster (with government assistance) has at least for the time being been averted, we are left with an obvious question: if private property can evaporate overnight, then is our way of life as fragile and capricious as the stock market? Could it be that our understanding of private property has changed so radically that what we take for private property today is a mere shadow of the real thing?

One element of our trouble is that we have muddled our understanding of property. We have come to imagine that wealth is the same as property and that spending our money on consumables is as good as using it to secure a piece of real property. However, property and wealth are not the same thing, and one way to see this is by considering their respective range of uses. The value of abstract property, or paper wealth, can only be realized in exchange. One must sell one’s shares in order to make a profit. On the other hand, real, tangible property has both a use value as well as an exchange value. Land or the tools of one’s trade can be sold in the marketplace. But additionally, their value can be realized apart from exchange. I can work my land and produce food for myself and my family; with my tools I can build a chair to rest on or a house to live in; I can create marketable items and sell them through my business. Property characterized by use value is a form of property suited to independence, for it provides the owner with broader effective control than property suited merely to exchange. Additionally, such property serves to inculcate certain virtues that are indispensable bulwarks to a free society, including self-control, saving, thrift, and deferred gratification. This “real” form of property is especially suited to the revitalization of home economics.

Obviously, land has historically represented the quintessential form of property. Land has both an exchange value and a use value. But this distinction goes beyond land. Belloc insists that the craftsman, who owns his tools, is very different from the man who owns shares in a corporation: “As a craftsman at his work he is in full control, personal and alive; as a shareholder his control is distant, indirect and largely impersonal.”[12] For Belloc, economic freedom is possible only when an individual owns some means of production (capital).

Joseph Schumpeter makes much the same point but on a larger scale. There are, he argues, political and social consequences associated with the loss of the idea of real property as opposed to the wealth of the shareholder. He writes, “The capitalist process, by substituting a mere parcel of shares for the walls of and the machines in a factory, takes the life out of the idea of property.” Schumpeter goes on to describe how this life is drained away:

[the] evaporation of what we may term the material substance of property—its visible and touchable reality—affects not only the attitude of holders but also that of the workmen and of the public in general. Dematerialized, defunctionalized and absentee ownership does not impress and call forth moral allegiance as the vital form of property did. Eventually there will be nobody left who really cares to stand for it—nobody within and nobody without the precincts of the big concerns.[13]

Today most Americans do not live on farms, and most don’t want to; however, we do well to consider how the institution of private property can be protected and reinvigorated.

Property ownership on a scale that more readily admits of family-based endeavors points to a recovery of a vital function of the family that has slowly eroded in recent decades. A variety of scholars—including Robert Nisbet, Christopher Lasch, and Allan Carlson—have pointed out that the rise of industrialism along with the decline of family-based agriculture had the effect of moving economic activity out of the household and thus depriving the family per se of an important aspect of its meaning. As various functions—economic as well as educative—were outsourced, the essential purpose of the family was opened to question. Rather than performing a variety of functions essential to human flourishing, the family increasingly came to be held together by nothing more than bonds of affection (rather than mutual need), and the household, rather than performing creative and wealth-producing functions, became merely a center of consumption and rest from the activity of the productive world beyond the home. In the process, those who do not readily fit into the modern economy—namely young children and the elderly—find themselves excluded from productive economic activity and therefore reduced simply to the status of consumer.

In short, the locus of consistent, meaningful, productive work has shifted outward from the home. Children’s lives too often consist of being transported from one organized activity to another. In the process, they can easily come to believe that work is not essential and that the world consists merely of consumption and services oriented to them alone. The alternative is a restoration of meaningful work in the home, and the revitalization of real property is a necessary condition for this recovery. Tocqueville argued that in a democratic age, the “art of freedom” must be carefully cultivated. A society characterized by the ownership of private property, which in turn facilitates robust home economies, is one facet of that art.

Mark T. Mitchell, Ph.D., is Professor of Government and Chair of the Department of Government at Patrick Henry College in Purcellville, Virginia. He is also the co-founder of The Front Porch Republic.

[1]     Noah Webster, “Leading Principles of the Constitution,” reprinted in The American Republic: Primary Sources, ed. Bruce Frohnen (Indianapolis: Liberty Fund, Inc., 2002), 293.

[2]     Centinel, Letter I, reprinted in The American Republic: Primary Sources, ed. Bruce Frohnen (Indianapolis: Liberty Fund, Inc., 2002), 311.

[3]     Letter from Thomas Jefferson to James Madison, October 28, 1785. Electronic Text Center, University of Virginia Library.

[4]     Madison, January 23, 1792, Equality.

[5]     Karl Marx, “The Manifesto of the Communist Party,” The Marx-Engles Reader, ed. Robert C. Tucker, 2nd ed. (New York: Norton, 1978), 479-80. 

[6]     Marx, 477.

[7]     Hilaire Belloc, The Servile State (Indianapolis: The Liberty Fund, Inc., 1977), 107.

[8]     G.K. Chesterton, The Outline of Sanity (Norfolk, VA: IHS Press, 2002), 42.

[9]     Alexis de Tocqueville, Democracy in America, trans. Harvey C. Mansfield and Delba Winthrop (Chicago: University of Chicago Press, 2000), 608.

[10]   Tocqueville, 228.

[11]   Wilhelm Röpke, The Moral Foundations of Civil Society (New Brunswick: Transaction, 2002), 138.

[12]   Hilaire Belloc, An Essay on the Restoration of Property (Norfolk, VA: IHS Press, 2002), 75.

[13]   Joseph Schumpeter, Capitalism, Socialism and Democracy (New York: Harper & Row, Publishers, 1942), 142.