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« On Liberty, Part I | Main | What is 'Limited Government'? »
Saturday
Jan092010

Two Reasons We Must Defend Private Property

Those who support liberty cannot do so without supporting the individual right to private property.  We take for granted the right to own that which we cultivate, but, if we fail to understand why private property rights are essential to our liberty, we leave ourselves vulnerable to politicians willing to trade our well-being for popularity.

To that end, I thought it helpful to introduce two economists and fervent defenders of private property rights, Ludwig Von Mises (1881-1973) and Thomas Sowell.  In the 20th century, Von Mises was a leading thinker in the Austrian School of economics and a widely respected defender of free market economics.  Sowell, a popular modern day economist, author, and commentator has dedicated his life to combating economic fallacies of the left.   Below excerpts underline two plain truths about the necessity of private property in a free and prosperous society.  Hopefully, in an age where leftists demean private ownership and daily interfere with individual decisions, these thoughts can help the conservative defend this basic principle.

First, Von Mises explains how private property is a check against the encroaching power of government.

“To control everything, to leave no room for anything to happen of its own accord without the interference of the authorities—this is the goal for which every ruler secretly strives.  If only private property did not stand in the way!  Private property creates for the individual a sphere in which he is free of the state.  It sets limits to the operation of the authoritarian will.  It allows other forces to arise side by side with and in opposition to political power.  It thus becomes the basis of all those activities that are free from violent interference on the part of the state.  It is the soil in which the seeds of freedom are nurtured and in which the autonomy of the individual and ultimately all intellectual and material progress are rooted.  In this sense, it has even been called the fundamental prerequisite for the development of the individual.”[i]

Second, Sowell explains why countries with established private property rights far exceed the prosperity of countries that do not respect individual property.

“For economic activities that take some time, property rights are a prerequisite, so that those who farm or invest in business can feel assured that the fruits of their activities will be theirs.  Even people who own no property have a large stake in property rights, if they are to be employed in an economy made prosperous by the presence of property rights…

Many of the great corporate enterprises of the world began at an extremely modest level, such as those already achieved by innumerable entrepreneurs in the Third World.  The Hewlett-Packard corporation, for example, began in a garage that was rented with borrowed money; the J.C. Penney department store chain was begun by a man who grew up in worse poverty than most people on welfare today; the NBC broadcast network was begun by a man who had to support himself as a teenager by hawking newspapers on the street.  The list could go on and on.  But all these people without money lived in a society where they had access to other people’s money, as a result of a legal system where property rights facilitated the transfer of money from those who had it to those who had entrepreneurial talents but no money.”[ii]

 


[i] Von Mises, Liberalism:  The Classical Tradition, (Indianapolis:  Liberty Fund, 2005),  43-45.

[ii] Thomas Sowell, Economic Facts and Fallacies, (New York:  Basic Books, 2008), 200-202

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