Thursday, April 20, 2017

The Private Property Society and the Outliers

By Robert Wenzel

Every time a discussion of a Private Property Society comes up, a society where rules are set by the owner of his property, someone will raise the point of the far away outlier who has some pretty odd rules for his property.

It happened again at yesterday's post, Fraud in a Private Property Society.

A commenter replied to the post with this query:

Very interesting column, RW. In this PPS, suppose that Crazy Harry owns some land and has a rule that anyone who enters his land must be bare-headed, or he/she will be shot dead. This rule is posted at various places on the border of his land. Locals are well aware of Harry's crazy rules, and carefully avoid his property. However, George arrives on a train from the East Coast, and, through a cruel twist of fate, blunders onto Harry's land, having failed to see any of Harry's signs. Harry shoots George dead (did I mention that George is wearing a hat?). George's relatives are somewhat put out by this sequence of events. Do they, should they, have recourse against Harry?
I think what must be done in these situations is to understand the underlying principle of the question which is never discussed. That principle can best be understood in the form of another question or actually a more complete original question "Should we have some outside body institute some sort of rules or regulations to  protect us against the Crazy Harry's of the world when they have outlier rules for their property?"

But the minute we institute regulation over all private property, we have moved beyond the Private Property Society into a world of government where a man is no longer free to set his own rules and do as he pleases on his own land.

Of course, it is terrible that Crazy Harry shoots someone for failing to heed to a bizarre regulation, but car accidents are also terrible as are deaths by poisonous mushrooms.

The fact of the matter is that we live in a world of disequilibrium where all facts are not known to us in advance. To attempt to design the world as though we know in advance all possibilities leads to the most horrific totalitarian states. It has to because the only way you can even attempt to control masses of people is by making simple rules that limit all kinds of activity.

F.A Hayek called it a fatal conceit to think we can plan the entire world.

Most people actually recognize this on one level on a daily basis, That's why people get into cars every day even though death occurs to people in cars. Should we have a rule that says no cars are allowed because there are deaths?

Should we ban all mushroom picking because someone may not be aware what is a poisonous mushroom and pick it?

Risk can not be eliminated from the world, even when rules and regulations become very simple with totalitarians banning almost activities--and what a "life" that would be.

Now, let's turn back to the far out possibility of a Crazy Harry, who has crazy rules and a new person to the area who wanders on to the property and breaks a rule of the property and Harry plugs him. That would be a terrible death as are automobile accidents and people who die from poisonous mushrooms.

But we must ask, what is the alternative to this incredible stretch on how a person could die in a PPS?

And the answer is rules overriding private property,  That is some form of government that sets rules for all properties, thus overriding the freedom of an individual on his own private property.

Thus, the question becomes: Do we want to start up government to prevent the one off-the-wall death that hypothetically might occur, a death seemingly less likely to occur than from an automobile accident or a person eating a poisonous mushroom?  Government being a form of society that has resulted in hundreds of millions dead. A form of society where, as Hayek pointed out in Chapter 10 of the Road to Serfdom, the worst get on top. Do I really need to remind that Hitler, Stalin, and Mao were all government leaders? If we ever end up with a PPS, do we really want to overthrow it for a form of society that has been led by such monsters?

This planet we live on is a very harsh place, Using our minds, we can not end all harshness but only attempt to structure things in a manner to minimize the harshness. To point out that a particular form of society may result in outlier bad outcomes can be done by anyone given the nature of our planet. The real question becomes the question of the economist, "The harshness of this society compared to what?"

It seems a great folly to me to promote a society that moves in a direction away from PPS and toward a society that overrules private property respect and has brought us true monsters via the government structure.

Robert Wenzel is Editor & Publisher of and Target Liberty. He also writes EPJ Daily Alert and is author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics, on LinkedIn and Facebook. The Robert Wenzel podcast is on  iphone and stitcher.


  1. I would think that Harry's neighbors would shun and boycott Harry and that he would sooner or later alter his rules.

    1. Harry's neighbors would likely have barriers onto his property to avoid accidents.

      Even in this absurd situation private solutions would mitigate the problem.

  2. In a PPS each community would develop norms about what are legitimate punishments for NAP violations. One such norm could be proportionality of punishment. If A violates B's property rights in a minor way, and B kills A (such as with Crazy Harry), then in that community such a sanction could be regarded as illegitimate for its lack of proportionality, and thus B would himself be regarded as violating the NAP. Accordingly, B may be, at a minimum, ostracized/excluded from further participation in that community, or liable to punishment himself in the form of retribution and/or compensatory damages.

  3. Let's take the recent race motivated murders in downtown Fresno where three random white people were killed by a black man inside of two minutes after he had publicized his hatred for whites. According to news reports he was homeless, lived on the streets, and had a known criminal record involving drug, weapons, and threats. He was also wanted in connection with the murder of a white security guard the previous week. The article went on to say that according to the chief of police, most people had "disassociated" themselves from him.

    Given these facts is it likely that he could freely roam the streets of a private property or stateless Fresno?

    1. I would think that the likelyhood that people would be homeless with a (state) criminal record would be far, far less likely in a PPS or stateless society. A much, much freeer and responsible society would have less dangerous drugs and less arbitrary weapons laws, though not none, even a PPS is not utopia.

      A PPS would not foster and encourage (as much) victimhood and resentment as valid positions to hold when a person encounters adversity and misfortune.

      Many more people would be of a fiscal position to aid a marginal person so that they might not be homeless but would not be in as bad a situation as this person appeared to be.

  4. Crazy Harry would probably get lynched the second he stepped off his own property for acting like an asshole.

    1. His neighbors might even build a ten foot high brick wall with warnings saying "Death is likely for those that enter the property on the other side." nearly completely surrounding such a person.

  5. Thomas Jefferson in a letter to James Madison discussed the question of who owns the earth.

    In a letter to James Madison dated Sept 6, 1789 [], Jefferson said that "the earth belongs in usufruct to the living". He used a technical legal term, "usufruct", which requires some explanation. A tenant in usufruct has "the right to enjoy the use and advantages of *another's* property short of the destruction or waste of its substance". This very adequately describes the rights human beings have as inhabitants of this planet for the short while we are here.

    I agree with Jefferson that we are all rather short-term tenants of property on this planet, not really owners, since what we claim to own existed before us and will continue to exist long after us. So, who has the right to override our "outlier" choices regarding "our" property. I would suggest that the great Spencer Heath MacCallum was on the right track. []

    1. Jefferson was right about many things, among them this discussion of private property. All too often, people fail to differentiate between "personal property" - our stuff - and "real property", lots and acreages and portions of the earth (and the structures upon them). It seems that our right to our personal property is pretty clear; even the bible warns commands us not to steal. We enjoy the rights to possess it, use it, sell it, rent it out, profit from it, or give it away. But how do those tenants of private property come about in regard to real property? The answer - and this truth is unsettling to we libertarians, and is thus often ignored - is that we only have private real property when a "country", and its government, claims the land, can defend that ownership, and in turn allows its citizens to "own" some of it. Private real property is indeed temporary. As are countries. And what of "public lands"? That is clearly a misnomer; those are private lands that the government (temporarily) owns but which they choose to "share". After all, do we citizens have the right to sell, rent, profit from, or give away those lands? No, only the government can do that. Do we even have a right to use those "public lands"? Sometimes. But only with the government's permission. And even then within specific parameters, and usually with a fee. It would help all of the discussions about private property if folks would differentiate between personal and real; if we could acknowledge that our private property rights are at the discretion of the government; and if we understand that our "public lands" are in fact the private property of the government.

    2. But this is begging the crucial question: from where does government get its legitimacy (really, where do the individuals at the state get their legitimacy) to seize and control land and the resources necessary to effect that seizure and control? That is libertarians' real beef with the state. The state's legitimacy is indefensible. It might in fact seize and control land, but that says nothing about its legitimacy. And if it is not legitimate, then the individuals at the state cannot grant "rights" to or withhold "rights" from anyone else.

  6. Thanks, RW. I find your reasoning highly persuasive. My "Crazy Harry" query IS, of course, by design an extreme example and I can't imagine myself feeling particularly paranoid about encountering CH if the rules were changed to allow him to behave that way. I'm much more paranoid when I see a cop car today, when police are treated like gods who are pretty much allowed to do whatever they please to us, including summary execution, with very little chance of more than a slap on the wrist (many get promotions and medals after particularly brutal and gratuitous acts). Even if we escape the clutches of the police with our lives, they may confiscate our cars and our cash and end up driving the cars and spending the cash on themselves. They easily outclass the largest private criminal gangs in the country.

  7. RW is pretty much alone in his view here. Even Rothbard viewed just punishment as requiring proportionality (Chapter 13 in "The Ethics of Liberty"). Anything beyond proportional punishment would be (in Rothbard's view) an act of aggression.

    RW's view, apparently, is that saying what someone can or cannot do on their own property (ie you can't murder small children for trespassing) violates the property rights of that person. Any requirement for proportional punishment would essentially be (in RW's view) an invocation of government (unless I'm misreading him). To RW, any punishment on privately owned property would be up to the subjective discretion of the property owner.

    In the example of "Crazy Harry" above, everybody has worked from the assumption that there is no dispute over the ownership of that property.

    To complicate this a bit, let's assume that both "Crazy Harry" and his neighbor "Frank" believe they own the piece of property. In a PPS, there would be many different ways of settling the dispute. Harry and Frank could sit down and try to reach an agreement (or send their representatives to do it ... arbitration) or they could use a private court (or courts) to settle the matter. If Frank uses a private court company which rules in favor of him, but Harry refuses to participate, what happens then? In a Rothbardian PPS, Harry could engage his own private court company to decide on the matter. And if Private Court Company A rules for Frank, but Private Court Company B rules for Harry, then the two Companies would select a mutually agreeable Company C to make a binding ruling on the property.

    But back to Crazy Harry being a stubborn old guy. He likely wouldn't participate and would simply refuse to acknowledge the authority of the private court company engaged by Frank. In Harry's subjective view, he owns the property, and that's all there is to it. If Frank used the private court's ruling to forcibly evict Harry, would it be an act of aggression? Frank did, afterall, appeal to an outside party to settle the dispute (would that, in RW's view, make the private court a "government"?).

    I assume that RW would say that determination of ownership of the property could be decided by objectively looking at the facts. Yet, he still would fall back on his subjective determination of punishment.

    This is not a logically consistent position. He has repeatedly stated that nobody else can determine how much the property owner (in this case, "Crazy Harry") has been harmed, so "Crazy Harry" can absolutely decide on whatever punishment he wants. Again, harm is completely subjective. And if "Crazy Harry" believes he owns Frank's property, is Harry any less subjectively harmed by Frank? The answer is an emphatic NO!

    This is a very roundabout way of getting to the point that punishment based on subjective harm is unworkable, because subjective harm is asinine.

    Subjective harm is impossible to determine, which is the reason that to Rothbard (and virtually every other libertarian writer), it was necessary to decide on objectively determined punishments (proportional to the actual crime).

    To RW determination of whether a crime occurred would need to be made objectively (again, unless I'm misreading him), but determination of punishment for that crime is completely based on the subjective harm of the aggrieved party.

    To Rothbard, determination of whether a crime occurred can be made objectively, and so can the determination of the appropriate (proportional) punishment for that crime.

    Rothbard's position is logically consistent, but RW's is not.

    RW needs to have a re-think here.

  8. There is a problem with your theory, Robert. If property owners can do whatever they want on their property, than they can certain post false signs. So a serial killer can post a "free beer" sign and then trap people in his dungeon when they enter his property looking for the free beer. And no one would be able to investigate, because he would not let anyone on his property. In fact, it is not at all clear how any sort of law enforcement would work in such a society.

    But this problem does not extend to just some crazy serial killer outliers. If you can do whatever you want on your property, you can make all sorts of false claims with no recourse. You can simply decide a contract is null and void when things don't go your way. It is hard to see how any sort of trade or contracts would take place, especially ones involving some sort of long term capital investment. All contracts and trade would have to happen on some neutral ground owned by a third party. You seem to believe that reputation would take care of everything. But if that was really the case, we would not need the courts, would we?

    When your assumptions lead to strange conclusions, it is time to reexamine your assumptions. In this case, the assumption is that property rights are absolute. They are not and never have been. Property rights are a bundle of rights and sometimes parts of the bundle are not present. Furthermore, there are some rights you never have on your property, such as the right to murder. Property rights are not some Platonic ideal pulled down into the physical world out of the Briah. Rather, they are an agreement, a sort of contract, between people.

    I do have to applaud you, because I think you have taken this philosophy, espoused by a certain branch of libertarians, to its ultimate conclusion. I think you should start calling yourself a "propertarian," rather than a libertarian, because I think property is more important to you than liberty.

  9. I would guess that if Harry did do such a thing, not only would he be shunned but someone would sneakily kill him and since he was being shunned no one would discover the death for days, months or maybe ever.

    That doesn't bring back the behatted victim of course, but nothing else would either.

    In any event this kind of what-ifing is pointless. Statists do this all the time, and it's tiresome from them and no less tiresome from people who ought to have a clue about how things work.

    I was in a discussion about food safety with a statist and mentioned that there would likely be insurance on both parties in a transaction and thus you could count on say a hot dog cart owner to be covered if he poisons you or at the very least you'll have some sort of coverage or perhaps the property owner where the cart is placed.

    He, of course, took this to mean that every sale of a hot dog would be preceded by a filling out of paperwork and all the parties in the sale would have to sign.

    So "what if there was no county health department" in his mind became a horrorshow where every sale of any food would take a huge amount of time.

    This guy doesn't understand that folks work to reduce transaction costs and because of that it wouldn't take anymore time to buy a hotdog as it is now.

    That can't see past the surface level, and it is aggravating to see non-statists fall into the same trap.

    Knock it off.

    Instead of focusing on the tragic event, look at it from different angles. Like what would keep Harry from acting that way in the first place? What would others do as soon as he put his signs up? There are tactics other than shunning that can be used, what are they?

    Don't think like a statist, think it through.

    1. "In any event this kind of what-ifing is pointless. Statists do this all the time, and it's tiresome from them and no less tiresome from people who ought to have a clue about how things work."

      Interesting how you jump from asking a basic question about how a particular vision of a well-constructed society would work, to "not having a clue". Your comment could be boiled down to "Don't talk about these things; only the clueless do that." That seems pretty silly to me.

  10. This was an episode of Star Trek The Next Generation. Wesley Crusher breaks a rule on an alien planet and the only penalty is death.

  11. So a PPS has no authority making rules over everyone, yet it does have a rule over everyone - the private property rule, yes? So why not 2 rules over everyone - the private property rule and the jury-determined proportionate response rule?

    RW is setting up a false dichotomy: that there are no rules (except the single one he likes) or too many rules. He wants us all to observe his property rule but he doesn't want to observe our proportionate response rule (which, BTW, is based in property rights). By referring to his rule as a theoretical "society" he ignore that it is just a rule which he likes.

  12. One way to blow up an ethical or philosophical position is to blow up the easy case. David Gordon does this to great effect (see, for one example).

    Here is an easy case. I live next to a person. He sells his land to Crazy Joe. Crazy Joe creates a "rule" that any trespasser will be killed. He puts up a sign.

    I get to work building a fence between our properties, but while I am doing so, my 3 year old sneaks off goes on Crazy Joe's land. Crazy Joe puts a gun to my son's head.

    If RW is right, I have no moral right to stop Crazy Joe. I have to watch my child be shot.

    Of course, that would be a disgusting perversion of life and liberty. I have every right to go on Crazy Joe's land and stop his aggression.

    So the philosophy fails an easy case.

    To find something with better footing, I recommend readers explore (1) Rothbard, who as good posters above note, addressed proportionality, and (2) the Salamancan Scholastics, who justified private property as emanating from its ultimate protection of life. Consequently, where property imperils life unreasonably, property rights are circumscribed.

    1. PPS has nothing to do with morals. It is a one law society: "do what you will...on your property." The proprietor is judge, jury and executioner in all matters and at all times.

      Red Queen Society

  13. Anyone can think up a rule or set of rules for everyone to follow. The trick is to think up a set of rules that MOST people will want to follow.

    RW's one rule society is silly and will never sell. So, the question is why does RW (or anyone) promote it? Since psychology is not science, but only guessing, we can never know.