Mises, Rothbard, and Hoppe on the “Original Sin” in the Distribution of Property Rights

[Update: Many of these issues are also discussed in Legal Foundations of a Free Society, e.g. in ch. 2, n.36, ch. 11, n.12, ch. 25, text at n.42]

Modern libertarianism began in the 1960s, about 50 years ago, with the writing of Ayn Rand and Murray Rothbard, primarily, and others like Leonard Read, Milton Friedman, Hayek, Mises, etc. Over the years, certain canards or confusions keep appearing, some from insiders, some from our statist critics. There’s a continual need to debunk and counter some of these. As the theory of liberty continues to mature and advance, the mistakes that need to be addressed become more obvious, at the same time that we are more able to address them.

I’d like to discuss here a couple of paired confusions relating to property rights. One relates to the “Lockean” argument for homesteading, or original appropriation of property; the other concerns rectification for past injustices. Both are interrelated. You’ve probably heard both of these in various forms. For example, the opponent of libertarianism just assumes that our theory is based on the Lockean idea of original appropriation—then makes the “original sin” argument that all property rights are tainted by various acts of theft or statism, and therefore, since you can never trace your property title back to the original pristine owner, no current property title is really valid.

My instant reaction to such comments is always: they are (if they are statists) trying to justify taking my property. If they are libertarians, they are trying to justify not being anarchist. Basically, when I hear people talk like this, I brace myself for the inevitable theft that they are about to endorse or condone or advocate. Two favorite quotes of mine come to mind here:

“Run for your life from any man who tells you that money is evil. That sentence is the leper’s bell of an approaching looter.” —Ayn Rand, Francisco’s Money Speech

“Is there a need to reform taxes? Most certainly. Always and everywhere. You can always make a strong case against all forms of taxation and all tax codes and all mechanisms by which a privileged elite attempts to extract wealth from the population. And this is always the first step in any tax reform: get the public seething about the tax code, and do it by way of preparation for step two, which is the proposed replacement system.

“Of course, this is the stage at which you need to hold onto your wallet.” —Lew Rockwell

When I hear people saying the libertarian theory of property is flawed because it relies on theft, etc., I know this is just a precursor to some kind of advocated aggression. I hold onto my wallet. I keep an eye on these people.

These issues are related but somewhat different. Let me take them one at a time.

First. As Hans-Hermann Hoppe argues in A Realistic Libertarianism and many other pieces, property rights arise only because of the fundamental fact of scarcity: the fact that in the real world human actors can have conflict over the use of scarce, rivalrous, material goods and means. To permit the peaceful, cooperative, productive, conflict-free use of scarce resources, property rights allocate a unique owner for each and every resource. The rules are simple, common sense, and natural. They are rooted in Lockean homesteading, or original appropriation: whoever has and uses a resource first has a better claim to it than a latecomer. And this basic rule is augmented by two others: consent, or contract; and rectification. If an owner contractually assigns (by gift, sale, etc.) the thing to someone else, then the recipient now has a better claim than the original homesteader. Indeed, he has a claim better than anyone else in the world, since he in a sense “piggybacks” on the title of his seller (“ancestor in title” in legal jargon). With respect to any third party, he has a “better claim” because he stands in the shoes of (called “subrogation” in the law) his seller, but with respect to the seller, he has a better claim because of the contract between them. And a third rule is based on rectification: if a property owner harms some victim, he owes some form of compensation or restitution, which may be satisfied out of the assets of the owner-tortfeasor. So if there is a dispute over who should have ownership of a given resource by two or more competing claimants, the libertarian answer is that we answer the question by appeal to these principles: who had it first, what contracts were engaged in, what torts were committed. These principles can be used to determine the owner of any contested resource.

The libertarian approach summarized above is rarely stated so concisely or clearly, partly because our science is young and still developing, and partly because many libertarians or quasi-libertarians have a different approach as to how to explain their views or argue for them. But when it is stated clearly like this, or its essence or outlines begin to become clear by example and metaphor, etc.—the opponent of radical libertarian principle tries to attack it. Because he wants to be able to have institutionalized theft or, if he is a (non-anarchist/non-principled/non-radical/non-“labeler”) libertarian, he wants to justify his wishy-washy mealy-mouthed tentative, progressive, incremental, respectable libertarianism. The former wants to remove obstacles to widespread institutionalized theft and domination; the latter wants to assuage his nagging libertarian conscience, to forgive himself for being a quasi-statist sellout, who really knows that he should know better.

But what do they say—both insiders and outsiders? They will say “AHA! Your theory depends on title being pristinely established by a first owner in an ideal state, and then being traced unerringly to the current claimant; but this is almost never the case because historical records are shaky and because there is often some act of violence that every current title is really traced back to.” In other words, they set up a straw man of libertarian theory and say that if you can’t trace your property back to Adam, then it’s invalid. And guess what? The state can swoop in and take it and distribute it to the poor or use it for public/social purposes, and no one can complain, since the “owner” was not a real owner. He has no grounds to complain. Left unstated in these arguments is the implicit argument that the state itself is the real owner. Even though the state itself also never was the pristine Lockean original homesteader of the land (except in the case of national forests which … well, it still doesn’t use them, and, anyway, it did it using pilfered tax dollars, so nevermind). Notice that those who want to control or dominate (own) a resource, often denigrate the institution of private ownership, as their excuse to … own the resource? And thus we circle back to the Rand and Rockwell comments above. The castigation of natural ownership is motivated, if not by envy, ¹ then by naked greed, covetousness, and desire to dominate and control and steal and take that which is produced by others. The proponents of this view have to advocate a might-makes-right worldview, but to admit this is dangerous, so they cover it in various disingenuous and vague, metaphorical aphorisms. Notice also that those who object to the right of owners to first-appropriate unowned goods is incoherent. As I note in What Libertarianism Is (n.26):

See also de Jasay’s argument (note 19, above) that since an appropriated thing has no other owner, prima facie no one is entitled to object to the first possessor claiming ownership.

… [from n.19:] De Jasay’s argument presupposes the value of justice, efficiency, and order. Given these goals, he argues for three principles of politics: (1) if in doubt, abstain from political action (pp. 147 et seq.); (2) the feasible is presumed free (pp. 158 et seq.); and (3) let exclusion stand (pp. 171 et seq.). In connection with principle (3), “let exclusion stand,” de Jasay offers insightful comments about the nature of homesteading or appropriation of unowned goods. De Jasay equates property with its owner’s “excluding” others from using it, for example by enclosing or fencing in immovable property (land) or finding or creating (and keeping) movable property (corporeal, tangible objects). He concludes that since an appropriated thing has no other owner, prima facie no one is entitled to object to the first possessor claiming ownership. Thus, the principle means “let ownership stand,” i.e., that claims to ownership of property appropriated from the state of nature or acquired ultimately through a chain of title tracing back to such an appropriation should be respected. This is consistent with Hoppe’s defense of the “natural” theory of property. Hoppe, A Theory of Socialism and Capitalism , pp. 10–14 and chapter 7. For further discussion of the nature of appropriation, see Jörg Guido Hülsmann, “The A Priori Foundations of Property Economics,” Quarterly Journal of Austrian Economics 7, no. 4 (Winter 2004): 51–57.

One mistake made by those who attack Lockean-libertarian original appropriation on the grounds that most title is tainted or cannot be really traced back to an absolutely “proven” “owner” (the “original sin” approach to property title) is that they are unaware of the practicalities of legal solutions to this problem and also apparently unaware of the overall context in which this issue arises: a society of people who need objectively-determined rules of property ownership to specify a given owner. In such a social context, the dispute is always, necessarily, between two or more existing, living beings. They have to resort to the principles of original appropriation, contract/consent, and rectification/restitution to establish a “better claim” than the other competing disputant-claimants. But of course, in a real-world setting, one rarely needs to “trace his title” back to Adam. The issue is: among the claimants, who has the better claim? This is a practical question, and it involves issues of evidence and procedure, burdens and standards of proof, etc.  Suppose A and B both contest ownership of a given piece of land, Blackacre. Maybe it was owned in the past by other lines, and then control was transferred by conquest or some statist violence. So the origins of title are lost to the mists of time. But suppose A and B both claim title based on some holding of C, from 300 years ago. If they agree on this (a legal “stipulation”), then the only question is: from C’s ownership, which of A and B has the better claim? So we proceed from C’s ownership. We don’t need to trace it back to the formation of the state of Texas or France, or even to Adam. We proceed from a common ancestor. Because title is always a relative thing. Your legally recognized right to control the resource is sufficient, if and to the extent that it does or can “beat” the claims by other potential contestants or disputants. If they all have to trace back to C from 300 years ago, because records before that are hazy or lost, then that will be determinative and will give the “winner” effective title good as against the whole world (or any realistic possible contestant in this present world). As I noted in What Libertarianism Is, n.25 and accompanying text:

More generally, latecomers’ claims are inferior to those of prior possessors or claimants, who either homesteaded the resource or who can trace their title back to the homesteader or earlier owner.[25]

[25] See Louisiana Code of Civil Procedure, Art. 3653, providing:

To obtain a judgment recognizing his ownership of immovable property … the plaintiff … shall:

1. Prove that he has acquired ownership from a previous owner or by acquisitive prescription, if the court finds that the defendant is in possession thereof; or
2. Prove a better title thereto than the defendant, if the court finds that the latter is not in possession thereof.

When the titles of the parties are traced to a common author, he is presumed to be the previous owner.

See also Louisiana Civil Code, Arts. 526, 531–32; Yiannopoulos, Property, §§ 255–79 and 347 et pass.

In other word: in a real-world dispute about who owns a given resource, it is irrelevant whether we can “trace it back to Adam” or the original appropriator. It is irrelevant that there might have been corruption or theft or “original sin” in the ancestry of title. If B cannot show better title or claim than the current possessor and apparent owner A, then B loses. Period. It does not matter that A cannot “trace his title back” to the original homesteader. A does not need to show title good against the world; only against all potential contestants. If A has a better title than B, to a common ancestor [author] in title, then A wins vis-à-vis B. And if no one else in the world is in a better position than B, that is, cannot trace the title back to an earlier ancestor in title than A or B could, then A’s title is in effect in rem, i.e., good against the world, i.e. “real” property (real meaning “in rem”, as opposed to personal property; the more coherent civil law analogues are immovable and movable corporeals, as opposed to real or personal “tangibles”).

The point is: in a given real-world dispute—which is what disputes always are—we can solve the issue by resort to the main principles, and without having to “trace title back” to some hypothetical propertarian homesteader “Adam.” People who insist on such a pristine standard are just using this as a way to take others’ property. In other words, they impugn the sanctity of private property claims as a cover for their own property claims. But once you make property claims, you need to “enter the cathedral” of libertarian rights theory even to discuss these matters or try to challenge it. As I wrote in the conclusion to my article New Rationalist Directions in Libertarian Rights Theory:

Under the three theories outlined above—argumentation ethics, estoppel theory, and the self-contradictions of rights-skeptics—we can see that the relevant participant in discourse cannot deny the validity of individual rights. These rationalist-oriented theories offer, in my opinion, very good defenses of individual rights, defenses that are more powerful, in a sense, than many other approaches, because they show that the opponent of individual rights, whether criminal, skeptic, or socialist, presupposes that they are true. Critics must enter the cathedral of libertarianism even to deny that it exists. This makes criticism of libertarian beliefs hollow: for if someone asks why we believe in individual rights, we can tell them to look in the mirror, and find the answer there.

[See also my post Thoughts on the Latecomer and Homesteading Ideas; or, Why the Very Idea of ‘Ownership’ Implies that only Libertarian Principles are Justifiable.]

And second. There is the related notion that if you favor the libertarian view of aggression and the related libertarian-Lockean notion of property ownership, you must be in favor of “everything is game”—that the existing order is so corrupt and so influenced by capitalist-corporatist-feudalist “original sin” that the existing “pattern of ownership” cannot be “valid” (how dare those rich people have Mercedes and jobs and houses! How dare they! How dare they be able to afford to send their kids to private colleges?). So, natch, if the “existing pattern of ownership” is not “valid,” this opens the door to wholesale redistribution and Mad Max world chaos, beloved of the economically ignorant left only because they pretend to think that this would result in some bucolic utopia of peace, harmony, Woodstock Festival reenactments, and primitivist self-sufficiency and freedom from the shackles of the “alienation of labor” the capitalist system would otherwise “impose” on them (after it provided them the chemicals for delousing).

This notion has already been addressed, by thinkers such as Mises, Rothbard, and Hoppe. I’ll quote them here, on this particular issue:

Mises, in Socialism:

All violence is aimed at the property of others. The person—life and health—is the object of attack only in so far as it hinders the acquisition of property. (Sadistic excesses, bloody deeds which are committed for the sake of cruelty and nothing else, are exceptional occurrences. To prevent them one does not require a whole legal system. Today the doctor, not the judge, is regarded as their appropriate antagonist.) Thus it is no accident that it is precisely in the defence of property that Law reveals most clearly its character of peacemaker. In the two-fold system of protection according to having, in the distinction between ownership and possession, is seen most vividly the essence of the law as peacemaker—yes, peacemaker at any price. Possession is protected even though it is, as the jurists say, no title. Not only honest but dishonest possessors, even robbers and thieves, may claim protection for their possession.[6]

Some believe that ownership as it shows itself in the distribution of property at a given time may be attacked by pointing out that it has sprung illegally from arbitrary acquisition and violent robbery. According to this view all legal rights are nothing but time-honoured illegality. So, since it conflicts with the eternal, immutable idea of justice, the existing legal order must be abolished and in its place a new one set which shall conform to that idea of justice. It should not be the task of the State “to consider only the condition of possession in which it finds its citizens, without inquiring into the legal grounds of acquisition.” Rather it is “the mission of the State first to give everyone his own, first to put him into his property, and only then to protect him in it.”[7] In this case one either postulates an eternally valid idea of justice which it is the duty of the State to recognize and realize; or else one finds the origin of true Law, quite in the sense of the contract theory, in the social contract, which contract can only arise through the unanimous agreement of all individuals who in it divest themselves of a part of their natural rights. At the basis of both hypotheses lies the natural law view of the “right that is born with us.” We must conduct ourselves in accordance with it, says the former; by divesting ourselves of it according to the conditions of the contract the existing legal system arises, says the latter. As to the source of absolute justice, that is explained in different ways. According to one view, it was the gift of Providence to Humanity. According to another, Man created it with his Reason. But both agree that Man’s ability to distinguish between justice and injustice is precisely what marks him from the animal; that this is his “moral nature.”

Today we can no longer accept these views, for the assumptions with which we approach the problem have changed. To us the idea of a human nature which differs fundamentally from the nature of all other living creatures seems strange indeed; we no longer think of man as a being who has harboured an idea of justice from the beginning. But if, perhaps, we offer no answer to the question how Law arose, we must still make it clear that it could not have arisen legally. Law cannot have begot itself of itself. Its origin lies beyond the legal sphere. In complaining that Law is nothing more or less than legalized injustice, one fails to perceive that it could only be otherwise if it had existed from the very beginning. If it is supposed to have arisen once, then that which at that moment became Law could not have been Law before. To demand that Law should have arisen legally is to demand the impossible. Whoever does so applies to something standing outside the legal order a concept valid only within the order.

We who only see the effect of Law—which is to make peace—must realize that it could not have originated except through a recognition of the existing state of affairs, however that has arisen. Attempts to do otherwise would have renewed and perpetuated the struggle. Peace can come about only when we secure a momentary state of affairs from violent disturbance and make every future change depend upon the consent of the person involved. This is the real significance of the protection of existing rights, which constitutes the kernel of all Law.

Rothbard, as discussed in my post Justice and Property Rights: Rothbard on Scarcity, Property, Contracts…,, in 1974:

It might be charged that our theory of justice in property titles is deficient because in the real world most landed (and even other) property has a past history so tangled that it becomesimpossible to identify who or what has committed coercion and therefore who the current just owner may be. But the point of the “homestead principle” is that if we don’t know what crimes have been committed in acquiring the property in the past, or if we don’t know the victims or their heirs, then the current owner becomes the legitimate and just owner on homestead grounds. In short, if Jones owns a piece of land at the present time, and we don’t know what crimes were committed to arrive at the current title, then Jones, as the current owner, becomes as fully legitimate a property owner of this land as he does over his own person. Overthrow of existing property title only becomes legitimate if the victims or their heirs can present an authenticated, demonstrable, and specific claim to the property. Failing such conditions, existing landowners possess a fully moral right to their property.

And, more recently, Hoppe, from A Realistic Libertarianism, September 30, 2014

The State in its long history has made some people richer and others poorer than they would have been otherwise. It killed some people and let others survive. It moved people around from one place to another. It promoted some professions, industries or regions and prevented or delayed and changed the development of others. It awarded some people with privileges and monopolies and legally discriminated against and disadvantaged others, and on and on. The list of past injustices, of winners and losers, perpetrators and victims, is endless.

But from this indisputable fact it does not follow that all or most current property holdings are morally suspect and in need of rectification. To be sure, State-property must be restituted, because it has been unjustly acquired. It should be returned to its natural owners, i.e., the people (or their heirs) who were coerced to ‘fund’ such ‘public’ property by surrendering parts of their own private property to the State. However, I will not concern myself with this particular “privatization” issue here.[5]Rather, it is the further-reaching claim that past injustices also render all current private property holdings morally suspect, which does not follow and which is certainly not true. As a matter of fact, most private holdings are likely just, irrespective of their history – unless and except in such cases in which a specific claimant can prove that they are not. The burden of proof, however, is on whoever challenges the current property holdings and distribution. He must show that he is in possession of an older title to the property in question than its current owner. Otherwise, if a claimant cannot prove this, everything is to remain as it currently is.

The left-libertarians, and other internal and external critics of propertarian libertarianism, are wrong. Property title need not be traced back to “Adam” to be valid; better title is sufficient. ²  And if we were ever to succeed in dismantling the state, libertarian ethics certainly do not call for taking property from current possessors simply because of some original sin in the misty and messy history of property title. Property may be taken from a current possessor only if there is an identifiable victim and victimizer. Otherwise, as Hoppe summarizes, and as is supported by common sense and the insights of Mises and Rothbard, “everything is to remain as it currently is”. This is anathema to the egalitarian-minded redistributionist and modernist-capitalist-hating left, but so be it.

Update: See Jeff Deist’s breakdown of Rothbard’s approach to such property issues in “A Libertarian Approach to Disputed Land Titles,” Mises Wire (June 3, 2021).

1. See Robert Sheaffer, Resentment Against Achievement.[↩]
2. For more on this see my post The Essence of Libertarianism?. [↩]