Locke Didn’t Say That, Bro: Why Rent is not Theft
Left-wing market anarchists sure can be an interesting bunch, with their focus on egalitarianism as the raison d’être for the free market, and their general contempt for real property. To wit, the mutualist/agorist crowd holds that whole free market operations allow for the unlimited accrual of personal property, private property is a breach of the common ownership of natural resources. In their view, mixing one’s labor with extant natural resources bestows no special privileges on the industrious, who have simply undertaken to improve the overall lot of the commons.
This suspicious attitude towards full private property rights is certainly nothing new, going back as far as Grotius (although, in contemporary form, more associated with figures such as Proudhon). As Nick Manley points out at C4SS, the basic objection to private property is that, in theory, it separates labor from ownership; i.e., it allows for the supposed specter of absentee control. In essence, mixing land with labor gives no ownership rights beyond immediate possession. You are entitled to any personal property that you specifically labored for, but the private ownership of real property – immobile property fixed to the land – is a nonstarter. Landlords can extract rents which, in market anarchist terms, is theft.
To the nonlibertarian, such matters may seem abstract and esoteric to the point of absurdity, but upon closer reflection, the right to obtain, own and dispense of property is critical to the wellbeing of a functioning society (or even. It might be argued, a largely dysfunctional society, as even the likes of North Korea is allowing the owning of private property these days). Private property plays a critical role in incentivizing the efficient use of resources in a manner that makes all parties better off. On an aggregate level, the ownership of private property combines with the market exchange to coordinate the activities of individuals seeking to maximize their own utility via the information transmitted through price signaling.
Locke, Stock and Leaky Barrel; The Problem with the Proviso
With this in mind, why then are there those who doggedly insist that rent is theft? Ironically, the genesis of this error may be John Locke, the Enlightenment philosopher largely responsible for developing the natural rights philosophies that inform modern Western liberal societies. Railing against Sir Robert Filmer’s doctrine of the divine right of kings, as posited in Filmer’s Patriarcha, Locke declares that the only legitimate reason for civil society to exist is the protection of life, liberty and estate.
For Locke’s observations on society to be valid, two assumptions must be held as absolute; with the second being contingent upon the first. The primary assumption is that each individual must own himself. Contrary to what it may seem on the surface, this does not reduce the individual to the status of property; in fact, quite the opposite is true. Because you and I retain full ownership in ourselves, we cannot then be the property of others, at least not without our rights being violated. It necessarily follows then, that one is entitled to the product of his labor.
Under this paradigm, everyone is equal in that we all retain self-ownership, and while the resources of nature belong to everyone in common, adding our labor to those resources confers ownership of them upon us. Everyone owns the mango while it is on the tree, yet, in this state, it is of no use to anyone. By climbing the tree and plucking it, I have made it mine. While this is certainly intuitive for personal property, it is the in the ownership of real property that the issues begin.
As prescient as he was, Locke included an addendum that seems to make the absolute right to own property less than absolute. To wit, he posited that the right to homestead property is limited to “…at least where there is enough, and as good, left in common for others”. This so-called Lockean Proviso set the stage for the somewhat bedeviling idea of the social minimum, the belief that members of society should arrange resources in a manner that provides each member a minimum standard of living. To be fair, the notion of a social minimum was also shared by luminaries such as Adam Smith and Henry George, but due to his definitive work on property norms, Locke’s Proviso arguably had the most far-reaching influence.
A Closer Look at the Proviso: Why Rent is Not Theft
The Proviso’s disconnect between absolute private property rights and the concept of the social minimum has led to all sorts of philosophical mischief (as have the stylings of Bakunin and Proudhon; nevertheless, the idea that liberty cannot be experienced individually, but only as a function of some societal greater good is anathema to be, and not worth further discussion). If resources are finite, then it would seem impossible on the surface for me to own a piece of fixed real property without leaving the commons worse off. As such, those opposed to the ownership of private real property claim that occupancy and use comprise the only fair apportionment of said property.
Additionally, they claim that absentee ownership, in the form of landlords, creates disparities in wealth and power that are antithetical to personal liberty. Further, because enforcement of contractual rent claims generally ends in the act of eviction, rent is a violation of the Non-Aggression Principle, and eviction tantamount to murder. To the uninitiated, the Non-Aggression Principle, or NAP, is an axiom central to libertarian thought that holds that no one may legitimately initiate force against another, as this is a violation of the victim’s self-ownership.
Upon further review, there are major problems with both claims. While, as Benjamin Powell notes, the vigorous defense of private property rights is positively correlated with a high degree of economic (and social) freedom, history has shown that societies that frown upon these rights are typically impoverished. This is because private ownership imposes upon the owner responsibility for his actions, giving said party the incentive to maximize resources and conserve for future use. It also incentivizes efficient trade, which works for the betterment of both counterparties. Without the ability to maintain ownership outside of occupancy and usage norms, lodging would be an every man for himself enterprise. I am rather partial to survival, so naturally, I would build a dwelling for myself, but without the ability to maintain absentee ownership, and trade temporary control for profit, I would have no incentive to build a dwelling for someone else to reside in.
Moreover, because I now have a stake in the long-run wellbeing of my private enterprise, I labor to avoid the tragedy of the commons, in which everyone uses the resources around them indiscriminately, inevitably exhausting the available resources and putting the survival of society at large at risk. Despite the appeals of the left-wing market anarchists to the Proviso, Locke was aware of this overall benefit to society, noting that
In retrospect, I have not curtailed your liberty be charging rent; I have enhanced it by improving upon the available resources in a manner which allows you to have convenient place to live, while focusing your efforts on fulfilling other matters of utility.
A Matter of Non-Aggression: Why Rent is Not Theft
As to the claim that enforcement of rental agreement violates the NAP, I am going to have to call a foul on the play. To truly understand the NAP, one must first place it within a societal framework in which it is valid as a foundational axiom (and yes, I am herein arguing that a libertarian framework must first exist in order for the NAP to exist, as opposed to the reverse that is often argued by fellow libertarians; it is, in my view, the result of extant libertarian philosophy, not the progenitor). We have already discussed, at least by implication, three of the four pillars that must exist to give the NAP vitality
According to Robert Nozick (yes, the cited article by is anti-NAP, but the distinction discussed here is valid), the principle of self-ownership must be inviolable, and, as an extension, the right to accrue external property. The right to dispose of this property, whether the transfer is a bequest or for profit, must also be inviolable. Finally, there must be some method of rectification when the first three principles are violated. This framework is where the concept that rent is a violation of the NAP meets its grisly end.
The NAP, you see, is a prohibition against the initiation of force. While some may posit that entering into a rental agreement is an act taken under duress, feelings aside, it is an agreement between counterparties. Because a contract has been entered, both counterparties now have obligations towards each other. The owner has rendered temporary control of the property he owns to the tenant in exchange for rent. Both parties are now responsible for the maximization and conservation of the property, preserving it for continued and future use; the landlord through contractual upkeep and the tenant through providing rental income that provides the funds for upkeep.
Failure to honor the rental contract on the part of the tenant violates the right of the landlord to dispose of his property as he sees fit; a violation, by extension, of his self-ownership. Because he maintains the right to seek rectification of this violation, eviction is not an unjustified use of force. Remember, it is the initiation of force that is prohibited by the NAP, not the reciprocation thereof. The violation by the tenant of the rental contract was the illegitimate initiation of force. In reality, this is act of theft.
As a parting thought, I grant that there is some legitimacy to concept of occupancy and use norms, as abandoned properties benefit no one and contribute to the tragedy of the commons. There is, however, a very real distinction between abandoned and vacant. A home that is empty, but in the process of being rented or sold (or improved upon for future sale, occupancy or rental) must be seen as a property that is being used. Moreover, even an abandoned property should revert to the legitimate owner once he has pressed his claim; arrangements can be made for the occupying party to compensate the owner going forward, with monetary concessions to any improvements the occupant has made.
To put all of this succinctly, rent is not theft.
Tarnell is an economist, entrepreneur and social observer. When he is not being a Lucky Libertarian, he is likely plotting to take over the world (and leave you alone) and singing romantic ballads to absolutely no one.