The Causal Theory of Property

In writing recently about the relationship between property and people, I was prompted to think more about the philosophical basis for property right.

In that article, I quoted John Locke’s theory that the source of property rights is the individual’s ownership of his own body and labor, so that he acquires rights in land or other goods by means of “mixing” his labor with the resources from his environment.

The Labour of his Body, and the Work of his Hands, we may say, are properly his. Whatsoever then he removes out of the State that Nature hath provided, and left it in, he hath mixed his Labour with, and joyned to it something that is his own, and thereby makes it his Property.

In looking up that quote, I happened across an interesting article in defense of Locke’s “labor theory of property” by an Objectivist law professor, Adam Mossoff. This is about as able a defense of Locke as you can mount, though overall, I found it more convincing as a refutation of Locke’s modern-day critics. Mossoff is definitely right that they are concrete-bound and logic-chopping, particularly the kind of argument offered by Robert Nozick.

Nozick had a particular high profile at the time I was studying philosophy in college, largely because of the novelty of a libertarian (of sorts) being on the faculty at Harvard. When I decided to check him out, I naturally went straight to his article, “On the Randian Argument,” his analysis of Ayn Rand’s philosophy—and boy, was that a big disappointment. It was in discussing this that I coined the term “spaghetti epistemology” to describe Nozick’s method, or lack thereof. He approaches every philosophical issue as if it were a plate of spaghetti: he picks up one strand, follows it in a meandering way for a little while until he thinks he’s come to an end, then picks up another strand and follows it for a while, and so on. This was and no doubt still is a common approach in contemporary philosophy—an inability to acquire an integrated understanding of any topic or idea.

The root of the problem is the age-old occupational hazard of philosophers: the tendency to look at ideas and arguments as a chain of words or symbols, rather than as a description of reality that can be understood by looking at reality. So they will logic-chop away at John Locke’s argument, noodling over the word “mingling,” without asking what fact in reality he is referring to.

Yet I still find Locke’s labor theory of property somewhat inexact and inadequate. There is clearly something real he is referring to when he talks about “mingling our labor” with the materials provided by nature, and we all have a pretty good sense of what it is that he’s talking about. But as with other aspects of Locke’s philosophy, it is more a metaphor than an exact, literal description. Locke is not wrong, he just hasn’t developed the idea far enough, and after more than three centuries, I think we can do better.

I expected that, as usual, we might find a better and more exact argument for property rights offered by Ayn Rand. In looking for it, I found her discussions of the issue to be surprisingly diffuse. For an idea that is clearly so central to her political philosophy, she discusses it only in short snippets, often in passing on her way to another point. This can produce the impression that she is merely relying upon the work Locke had already done and taking the labor theory of property as her foundation. That is particularly the case in her essay “What Is Capitalism?” where she defines the basic issue behind capitalism this way: “Is man a sovereign individual who owns his own person, his mind, his life, his work, and its products?” Now there is a Lockean formulation if ever there was one.

Yet I think there is a central idea in her writings on the source of property rights that is coherent, integrated, and unique to her.

In looking back at the lessons I learned from writing my book on Atlas Shrugged, I wrote that the big lesson I took away is that Ayn Rand is the philosopher of causation, that the concept of causation and the identification of cause and effect relationships is a central theme of her philosophy.

So I was thrilled to find, right in the middle of Galt’s Speech, this sentence: “The source of property rights is the law of causality.”

Ayn Rand does not simply borrow John Locke’s labor theory of property. She adds to it and supersedes it with a causal theory of property.

To understand this, first let’s start by looking at reality and trying to understand more precisely what Locke is trying to capture when he talks about “mixing” our labor with the items found in nature.

Let’s take the example of a settler on the frontier finding an open field, a bit of untamed prairie, which he then fences, plows, and plants. By means of his labor, he has turned a grassy field into productive farmland. He has changed it from one thing to another kind of thing. To say that he has “mixed his labor” with the land is somewhat metaphorical, even poetic. But to state what has happened in terms that are strictly literal and exact, we can say that the man’s labor is the means by which he has caused this transformation of the land. It is the means by which he has created its increased value as farmland.

From this perspective we can restate Locke’s labor theory as a causal theory. The existence of the property is the effect; the cause was the work performed by the person who created it. “Creation” and “creator” are crucial concepts here. A valuable thing that did not exist before has been brought into existence. It has been created by human action. So in this regard, the right of property is the right of the creator over his creation.

Hence the following formulation from Ayn Rand:

Any material element or resource which, in order to become of use or value to men, requires the application of human knowledge and effort, should be private property—by the right of those who apply the knowledge and effort.

The argument is not that the property somehow contains or is mixed with one’s own labor. The argument is that the property would not exist unless one’s labor had made it “of use or value to men.” It is your property because you have caused it to be of value.

This explains why naturally occurring “elements or resources” which do not require human effort to produce—such as air and sunlight—cannot, under normal circumstances, be owned. (I say, “under normal circumstances,” because air in a scuba tank or in a spacecraft is harnessed by means of “human knowledge and effort” and can be property.)

But note that Ayn Rand wrote this as her introduction to an article on “The Property Status of Airwaves,” as an introduction to her discussion of intellectual property. This adds another layer to her causal argument for property rights. The cause of a useful good is not mere physical labor but also mental labor. This is clear when talking about intellectual property. But she argued that it is true to some extent of all productive work.

Here is how she expanded on that in her article, “Patents and Copyrights.”

Every type of productive work involves a combination of mental and physical effort: of thought and of physical action to translate that thought into a material form. The proportion of these two elements varies in different types of work. At the lowest end of the scale, the mental effort required to perform unskilled manual labor is minimal. At the other end, what the patent and copyright laws acknowledge is the paramount role of mental effort in the production of material values; these laws protect the mind’s contribution in its purest form: the origination of an idea.

Note that while she says unskilled manual labor involved “minimal mental effort,” it still requires some mental effort. A man digging a ditch has to know where to dig it, how wide and deep, and in what direction. Labor performed at random, with no plan or direction, is not likely to produce anything of value.

She argues that “a man’s right to the product of his own mind” is “the base of all property rights.” It is not merely that the property exists because of the labor that caused it come into existence. The property exists because of the thinking that caused it to come into existence. And this thinking is something that inherently cannot be coerced.

This brings us back to her statement in Galt’s speech about causality and property rights. Here it is in full.

The source of property rights is the law of causality. All property and all forms of wealth are produced by man’s mind and labor. As you cannot have effects without causes, so you cannot have wealth without its source: without intelligence. You cannot force intelligence to work: those who’re able to think, will not work under compulsion; those who will, won’t produce much more than the price of the whip needed to keep them enslaved. You cannot obtain the products of a mind except on the owner’s terms, by trade and by volitional consent.

So all property is the causal product of thinking, and thinking is the causal product of choice. An individual’s property must be free from coercion because its source, his mind, must be free from coercion.

Note that in this respect, Ayn Rand’s argument for property rights is closer to John Locke’s argument for religious freedom. In his Letter Concerning Toleration, he argued that truth in matters of religion proceeds only from “the inward persuasion of the mind” and “the light of [our] own reason,” “And such is the nature of the understanding, that it cannot be compelled to the belief of anything by outward force.”

These arguments, so far, are pitched on the level of efficient causation: a description of the means by which a cause produces its effect. But Ayn Rand was also an advocate of the importance of final causation, which she described as “the process by which an end determines the means, i.e., the process of choosing a goal and taking the actions necessary to achieve it.” Efficient causation is a description of how something happens, while final causation is a description of why it happens.

(In Ayn Rand’s philosophy, final causation is a form of efficient causation. The idea of one’s goal is the efficient cause of one’s actions to achieve that goal.)

In her essay “Causality Versus Duty,” she describes final causation—the causal relationship between means and ends—as the central concept of her entire theory of morality.

How does that apply to property rights? It adds yet another level of causation. We started with the observation that work is the cause of all property. We added that a specific kind of work, thinking, is an essential cause of all property. Now we add that this labor and thinking is caused by the pursuit of a goal. A man who engages in thought and labor to produce something of value does so in order to use that thing for his ends.

The widely accepted elements of property rights—which at least one source calls the “triad of ownership”—are possession, use, and disposal. One must be able to possess a piece of property, to have exclusive and unrestricted physical access to it and control over it. One must be able to put it to use for the pursuit of your goals, which includes ownership of anything produced by means of your use of your property. And one must be able to dispose of it, which primarily means the ability to trade it, transferring ownership of your property to another person in exchange for ownership of something that he has produced.

These elements are not derived from the concept of property, because they are all as old as mankind itself. (Some, such as possession, are older. A bird will defend its nest; a lion will defend its kill.) Instead, the concept of property was derived from these pre-existing and ineradicable elements of human life.

The causal theory of property explains why these elements are inherent to the right to property. Property is created by a man’s actions for the purpose of the possession, use, and disposal of that property. Possession, use, and disposal are the causes that brought that property into existence—the final causes.

And behind the final cause of some one particular action, there is a larger final cause, the ultimate goal of all action: the “ultimate value,” life, which is the “final goal or end to which all lesser goals are the means.” In Ayn Rand’s philosophy, it is the requirements of life, the goals that have to be achieved in order to maintain one’s survival, that are the source of morality. Here is how she summed it up in “Causality Versus Duty.”

Reality confronts man with a great many “musts,” but all of them are conditional; the formula or realistic necessity is: “You must, if—” and the “if” stands for a man’s choice: “—if you want to achieve a certain goal.” You must eat, if you want to survive. You must work, if you want to eat. You must think, if you want to work. You must look at reality, if you want to think—if you want to know what to do—if you want to know what goals to achieve—if you want to know how to achieve them.”

One of those “musts” is that you must produce, and therefore you need property rights.

John Locke’s case for property rights was presented in the context of a wider moral theory, derived from Enlightenment-era ideas of “natural religion,” that God gave the Earth “to the use of the industrious and rational (and labour was to be his title to it).” Ayn Rand also puts property rights into a wider philosophical context—in her case, the role of property rights in a chain of means and ends that defines a whole moral system for human life.

Notice how it all fits together in this passage from “Man’s Rights.”

There is only one fundamental right (all the others are its consequences or corollaries): a man’s right to his own life. Life is a process of self-sustaining and self-generated action; the right to life means the right to engage in self-sustaining and self-generated action—which means: the freedom to take all the actions required by the nature of a rational being for the support, the furtherance, the fulfillment and the enjoyment of his own life….

The right to life is the source of all rights—and the right to property is their only implementation. Without property rights, no other rights are possible. Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means to sustain his life.

This, by the way, explains why Ayn Rand’s discussion of property rights is so diffuse and can even seem desultory. She spends much more of her time establishing this larger context: the requirements of human life as the foundation for morality; the need for productive activity as a primary requirement of human life; thinking by an uncoerced, individual mind as the root of production. Having established that context, the right to property seems so obvious as to require little explanation.

This causal theory of property can be summed up in four causal relationships: a man has a right to property because he created it by his own labor, by his own thought, for his own purposes, and as a necessary condition of his long-term survival.

This theory establishes the basis for the right to property, but it has not yet gotten us to a defense of capitalism. To get there, we need to focus on the last element of the “triad of ownership”: disposal. The right to disposal includes the right to destroy property, but in practice, it is almost exclusively invoked for the right to trade property.

If property is created for the purpose of possession, use, and disposal, as its final causes, this implies that some property is created for the purpose of trade. No one man can produce everything he needs by his own effort, at least not at any level beyond the barest subsistence. To sustain our lives, we need to be able to trade the products of our own thought and labor for goods and service produced by others. So it is the prospect of trade that causes the property to come into existence in the first place. Trade is central to the right to property, and to the cause-and-effect chain required to sustain human life.

In the modern world, the process of trade has been carried to a highly complex level. For philosophical purposes, we might begin with the example of the lone frontiersman homesteading unowned land and building a house with his own hands out of materials found on site—but very few people alive today will ever do this. (And we should be very glad that we don’t need to.) Instead, most of us trade our labor to an employer in exchange for some part of the value of the goods he produces, which we then trade for other peoples’ labor or goods, and so on in a vast and increasingly global chain of trade. The causal chain connecting our work and the goods we create has become more complex and indirect and involves a thousand trades we implicitly engage in every day without even thinking about them, but it is still a causal chain.

This causal theory of property also explains the relationship between the philosophic case for capitalism and the practical or economic case for capitalism. Pro-free-market economists focus on the efficiencies created by the right to property—its role in allocating capital to its most efficient uses. The causal theory of property explains the ultimate reason for that efficiency: An economy based on the right to property preserves the causal chain between labor and its product, between work and reward. It protects the causal chain in both directions. It ensures that someone who works will not be deprived of the value he created, and in so doing, it preserves the final causation that motivates him to work in the first place.

By contrast, when we destroy the free market, we break those causal chains, and we get the situation summed up in an old Soviet joke: “We pretend to work, and they pretend to pay us.”

A capitalist economy is a vast and complex network for the trading of human labor and its creations. But its foundation is individuals who are free to engage in those trades on voluntary terms as a way of connecting their productive actions to the pursuit of their personal goals and interests.

Property rights are the means by which we recognize, respect, and preserve the causal chains between work and life. Those chains are broken in an obvious but limited way when looters run riot through the streets of a city. They are broken in a less obvious way, but on a far greater scale, by the genteel looters of a legislature or a government agency.

If there is one lesson we should learn from Ayn Rand, it is that the law of cause and effect is the ultimate governor of human life. If we value our lives, we will respect that law—and that includes respect for the right to property.

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