Property Rights and Human Rights; P.L. Poirot

By implication, there are two sets of rights-one belong ing to human beings and the other to property. Since hu man beings are more important, it is natural for the un wary to react in favor of human rights. Actually, there is no such distinction between property rights and human rights. The term propertyhas no signifi cance except as it applies to something owned by some one. Property itself has neither rights nor value, save only as human interests are involved. There are no rights but human rights, and what are spoken of as property rights are only the human rights of individuals to property. Expressed more accurat~ly, the issue is not one of prop erty rights versus human rights, but of the human rights of one person in the community versus the human rights of another. NOTE: Excellent articles on the subject of human rights are contained in the July, 1952, Monthly Letter of the National City Bank and the October, 1952, Guaranty Survey of the Guaranty Trust Company.

[79 ] Those who talk about two sets of rights apparently want to discriminate between property income and labor in come-with the implication that the rights to rental and in vestment income are inferior, as a class, to the rights to income from wages and salaries. Actually, this is an unwar ranted assumption. It must be evident that all persons have rights which are entitled to respect. Safeguarding such rights is essential to the well-being of all. This is the only just principle. ~ Thus, the problem is not to establish priorities on human rights in the community, but rather to determine what the respective rights are in the particular cases under dispute. This is the real problem in human relations, and it is one that calls for the exercise of wis dom, restraint, and true administration of justice under law. What Are Property Rights? What are the property rights thus disparaged by being set apart from human rights? They are among the most an cient and basic of human rights, and among the most· es sential to freedom and progress. They are the privileges of private ownership, which give meaning to the right to the product of one's labor-privileges which men have always regarded instinctively as belonging to them almost as in timately and inseparably as their own bodies.

The ownership of property is the right for which, above (J For further clarification of this point, see Morals and the Welfare State by F. A. Harper, especially page 18. (Foundation for Eco nomic Education; single copy available upon request. ) [ 80] all others, the common man has struggled in his slow ascent from serfdom. It is the right for which he struggles today in countries emerging from feudalism. The sense of this right is so deep-rooted in human nature, so essential as a stimulant of productive effort, that even totalitarian regimes have been unable to abolish it entirely. It is a mistake to belittle the importance of property rights. Respect for these rights is basic to organized so ciety, and the instinct of individuals to acquire property is at the root of all economic progress. Unless people can feel secure in their ability to retain the fruits of their labor, there is little incentive to save and to expand the fund of capital-the tools and equipment for production and for better living. The industrial development of this country, which has given us the highest standard of living in the world and has made possible a miracle of production in war and peace, is dependent upon the observance of prop erty rights. Who is going to work and save if these rights are not recognized and protected?

The right to own property means the right. to use it, to save it, to invest it for gain, and to transmit it to others. It means freedom from unreasonable search and seizure and from deprivation without due process of law or without just compensation. It might also be fairly taken to imply a limitation upon taxation because "the power to tax in volves the power to destroy." For a like reason, it should imply assurance against governmental dilution of the money whereby the government takes property which otherwise could be claimed by wage and salary checks and other credit instruments. Further, it should insure against [ 81 ] other measures so burdensome or restrictive as to prevent the employment of savings in legitimate productive enter prise with a reasonable prospect of gain. Violation of any of these rights can nullify, in whole or in part, the right to property. The Bill of Rights in the United States Constitution rec ognizes no distinction between property rights and other human rights. The ban against unreasonable search and seizure covers "persons, houses, papers, and effects," with out discrimination. No person may, without due process of law, be deprived of "life, liberty, or property"; all are equally inviolable. The right of trial by jury is assured in criminal and civil cases alike. Excessive bail, excessive fines, and cruel and unusual punishments are grouped in a single prohibition.

The Founding Fathers realized what some present-day politicians seem to have forgotten: A man without prop erty rights-without the right to the product of his own laboris not a free man. He can exist only through the generosity or forebearance of others. These constitutional rights all have two characteristics in common. First, they apply equally to all persons. Sec ond, they are, without exception, guarantees of freedom or immunity from governmental interference. They are not assertions of claims against others, individually or collec tively. They merely say, in effect, that there are certain hu man liberties, including some pertaining to property, which are essential to free men and upon which the state shall not infringe. To many people, the expression "putting property rights [82 ] first and human rights second" brings to mind the oft drawn political picture of a struggle between a few "rich plutocrats" and "soulless corporate monopolies" on the one hand and the great body of humble citizens on the other.

Much of what the public reads and hears about the recur ring steel wage controversy conveys the same impression, with emphasis almost entirely on "the workers" versus the "big companies." John L. Lewis' blast against what he called the "rapaciOUSand predatory" steel industry illus trates the point. In a message to Philip Murray, president of the United Steelworkers, offering a loan of $10,000,000 of coal miners' dues from the union treasury to back up the 1952 steel strike, Mr. Lewis said: 'We are conscious of the strength of the vast array of adversar ies which confront you. Rarely has a union membership faced such a formidable grouping of financial and corporate interests as now oppose the steel workers of the nation in their long standing struggle to achieve their rightful aims and objectives in the industry." In all such talk about "big companies" and "formidable groupings of financial and corporate interests," hardly any thing is said about the shareholders, little and big, who are the real owners of the business and whose money, plowed into plant and equipment, has made possible the large em ployment and the record output.

Who Are The Propertied Classes? Actually, ownership of property cuts across those imagi nary lines between economic classes in the United States; [ 83] and in no other country is the stake in property rights so great and so widely distributed. While we hear much about large corporations with thousands of employees and mil lions of dollars in assets, it is probably not generally real ized that there are over 4,000,000 nonfarm business en terprises in this country. Of these, over nine-tenths are classified by the Department of Commerce as "small busi ness" on the basis of their number of employees or dollar volume of sales. The importance of "small business" in the economy of the country is further shown by the fact that it accounts for 45 per cent of the total employment of all business enterprises. One of the largest of our cCpropertiedclasses"-the farm ers-includes nearly 4,000,000 farm owners whose lands and buildings are valued at $55,000,000,000.

Even among large corporations, the ownership of stock is widely distributed; there are now 75 American compa nies each having over 50,000 registered shareholders. The Bell Telephone System, in its 1951 annual report, showed 1,092,000 shareholders, with no individual owner holding as much as 1/20 of 1 per cent of the total stock. Only five cities in this nation have as large a total population. Gen eral Motors, with greater sales volume than any other in dustrial corporation, has 479,000 shareholders. A study entitled Share Ownership in the United States, just completed by the Brookings Institution of Washing ton, reaches the conclusion that there are about 6,500,000 individual shareholders of investor-owned corporations. It was found by the survey-contrary to the opinions often heard-:that 32 per cent of the shareholders were from fam[ 84] ilies having incomes under $5,000 annually; 44 per cent had incomes of $5,000-$10,000; and only 24 per cent had incomes over $10,000.

What Are Human Rights? Now what about the so-called human rights that are repre sented as superior to property rights? What about the "right" to a job, the "right" to a standard of living, the "right" to a minimum wage or a maximum workweek, the "right" to a "fair" price, the "right" to bargain collectively, the "right" to security against the adversities and hazards of life, such as old age and disability? The framers of the Constitution would have been aston ished to hear these things spoken of as rights. They are not immunities from governmental compulsion; on the con trary, they are demands for new forms of governmental compulsion. They are not claims to the product of one's own labor; they are, in some if not in most cases, claims to the products of other people's labor. These "human rights" are indeed different from property rights, for they rest on a denial of the basic concept of property rights. They are not freedoms or immunities as sured to all persons alike. They are special privileges con ferred upon some persons at the expense of others. The real distinction is not between property rights and human rights, but between equality of protection from govern mental compulsion on the one hand and demands for the exercise of such compulsion for the benefit of favored groups on the other.

[85 ] The Right To A Job To point out these characteristics of the so-called human rights is not to deny the reality nor belittle the importance of the social problems they represent. Some of these prob lems are real and important. They are also complex, and in this further respect they are different from the rights guaranteed by the Constitution. There is no great difficulty nor danger in declaring that certain individual rights shall not be tampered with by the government-and in adhering to that principle. It is quite another matter to say that the government shall seize the property or curtail the freedom of some of its citizens for the benefit, or the supposed benefit, of others. To adopt this view is to cast both the government and the citizen in radically new roles, with far-reaching effects on economic behavior, political practices, and individual character. Consider, for example, the so-called right to a fob. This is a fine-sounding phrase that evokes an emotional re sponse. It creates a mental image of an unemployed worker and his family suffering hardship through no fault of their own. Noone would deny the reality nor the seriousness of that, especially when the unemployed worker is multiplied by millions. To find the best remedy, however, is a difficult matter; and it is not made easier by the use of such mis leading catchwords as the "right" to a job. One man's "right" to a job implies an obligation on the part of some one else to give him a job. Who has any such obligation?

An economy of private enterprise functions by means of voluntary contracts entered into for the sake of mutual [ 86] advantage. Jobs arise from such contracts. The obligation to fulfill his contract is the only right any person can have to a job. Both sides of the contract have to be fulfilled. The employer's job-his side of the contractis to anticipate what the consumers will want in the market place. His capacity to offer jobs to employees depends upon how well he understands the market pattern of consumer prefer ences. He has no right of control over the market. There is a limit to his capacity to provide, jobs. And in the final analysis, an employee's so-called right to a fob is deter mined by what consumers think the product or service is worth to them. As with the c;c;right"to a job, so with the other so-called human rights. These are not rights in the constitutional sense of respect for privacy; they are, instead, social pro grams which the government has undertaken or has been asked to promote. These programs, unlike true rights, are selective, coercive, complex, and experimental. Hence, they need to be carefully considered each on its own merits with due regard to the serious threats they may involve to the real and basic human rights that have enabled free men to build a society with' the highest level of material well-being ever achieved anywhere.

Triple Threats On the economic side, the gravest threat is that produc tive enterprise will be so burdened and impeded by high taxes, prohibitions, red tape, and controls that industry will stagnate. Without the products of industry, social [ 87 ] programs of any kind become empty promises. New politi cal powers and functions increase the cost of government and drain manpower from farms and factories into admin istrative bureaus. The great bulk of the money for benefit payments to favored groups must be taken from those who produce by putting forth their own efforts or by investing their savings. Minimum-wage rates wipe out the entire lower range of job opportunities in the business world. Only the government, with the power to tax, can pay more for labor than it is worth. Maximum-hour laws further limit the opportunity to be productive. Artificially pegged prices and wage rates interfere with the normal market process of gearing production to the maximum satisfaction of consumer wants. # On the poljtical side, the increase of power multiplies the opportunities for the abuse of power and the harm that can be done by such abuse. High tax rates expose tax payers and collectors to strong temptations. The disburse ment of billions of dollars in public funds opens new ave nues for favoritism and corruption. This system of political distribution of the wealth of a nation encourages govern ment by pressure groups, with the favors Hawing toward the groups with the most votes. Demands for more liberal benefits on the one hand and for tax relief on the other converge upon the public treasury. Deficit financing and currency depreciation tend to become national habits l';t See other publications by the Foundation for Economic Education: Inflation by F. A. Harper; The Price of Price Controls by Irving S.

Olds, on page 169; Economics in One Lesson by Henry Hazlitt. [ 88] which feed upon the savings of individuals and wipe out the means of production and progress. On the human 8ide~ the individual citizen discovers that it is increasingly difficult to get ahead by enterprise and thrift-increasingly profitable to join in the scramble for governmental favors and handouts. The sense of relation ship between services rendeted and payment received grows weaker. Personal initiative and self-reliance give way to an attitude of: Let theigovernment do it. Free citi zens tend to degenerate into wards of the state. These are not imaginary effects, but real ones. They are visible here and now. They are!the consequences of placing social programs, mislabeled I"human rights," above the real human rights, disparagingly called "property rights," which underlie the productive strength of free men. [ 89] WHY PRICES ARE HIGH No subject is so much discussed today-or so little under stood-as inflation. The politicians in Washington talk of it as if it were some horrible visitation from without, over which they had no control-like a flood, a foreign invasion, or a plague. It is something they are always promising to "fight'lt-if Congress or the people will only give them the "weapons ltlt or "a strong law'ltto do the job.