Political Economy and Political Philosophy Share a Source: Scarcity

Hans Hoppe’s famous “argumentation ethics” has generated a great deal of attention among libertarians, and deservedly so. Has Hoppe produced an ironclad demonstration that people have libertarian rights? I don’t propose to contribute to that discussion on this occasion. Rather, I should like to focus on a preliminary issue. It is one to which Hoppe has also made an outstanding contribution, but it has been neglected owing to the fascination of argumentation ethics.

The contribution takes rise from a penetrating question he asks: What is the origin of disputes about property? In his important essay, “The Justice of Economic Efficiency,” he answers in this way:

Let me clarify an essential similarity between the problem facing political economy and that facing political philosophy—a similarity that political philosophers in their widespread ignorance of economics generally overlook only to wind up in endless ad hoceries. The recognition of scarcity is not only the starting point for political economy; it is the starting point of political philosophy as well. Obviously, if there were a superabundance of goods, no economic problem whatsoever would exist. With a superabundance of goods such that my present use of them would neither reduce my own future supply nor the present or future supply of them for any other person, ethical problems of right or wrong, just or unjust would not emerge either since no conflict over the use of such goods could possibly arise. Only insofar as goods are scarce are economics and ethics required. In the same way, just as the answer to the problem of political economy must be formulated in terms of rules constraining the possible uses of resources qua scarce resources, political philosophy too must answer in terms of property rights. In order to avoid inescapable conflicts, it must formulate a set of rules assigning rights of exclusive control over scarce goods. (Note that even in the Garden of Eden, a person’s body, the space occupied by that body, and time would still be scarce and to that extent political economy and philosophy would still have a task, however limited, to fulfill.)

Hoppe makes even clearer the fundamental importance of scarcity and conflict in this passage, from “The Problem of Social Order”:

Robinson Crusoe, alone on his island, can do whatever he pleases. For him, the question concerning rules of orderly human conduct—social cooperation—simply does not arise. Naturally, this question can only arise once a second person, Friday, arrives on the island, yet even then, the question remains largely irrelevant so long as no scarcity exists. Suppose the island is the Garden of Eden. All external goods are available in superabundance. They are “free goods,” such as the air that we breathe is normally a “free” good. Whatever Crusoe does with these goods, his actions have repercussions neither with respect to his own future supply of such goods, nor with regard to the present or future supply of the same goods for Friday (and vice versa). Hence, it is impossible that there could ever be a conflict between Crusoe and Friday concerning the use of such goods. A conflict becomes possible only if goods are scarce, and only then can there arise a problem of formulating rules which make orderly, conflict-free social cooperation possible.

Hoppe’s solution to the problem of conflict rests on two premises. First, all rights are property rights. Second, property rights must be specified in a way that precludes different people from having control over the same resource. If the first premise is true, then if conflicts over property rights can be avoided, all conflicts over rights can in principle be settled. The second premise is merely another way of stating the requirement that the delimitation of property rights avoids conflict.

We must now inquire, is the first premise true? Murray N. Rothbard has made the most effective defense of it, and, as is often the case, Hoppe is his faithful disciple. As Rothbard explains, ostensible human rights that are not “cashed out” in property rights, such as the right to free speech, are intolerably vague. Once property rights have been properly determined, no other rights are needed:

[H]uman rights, when not put in terms of property rights, turn out to be vague and contradictory, causing liberals to weaken those rights on behalf of “public policy” or the “public good.” As I wrote in another work [Man Economy and State, chap. 18]:

Take, for example, the “human right” of free speech. Freedom of speech is supposed to mean the right of everyone to say whatever he likes. But the neglected question is: Where? Where does a man have this right? He certainly does not have it on property on which he is trespassing. In short, he has this right only either on his own property or on the property of someone who has agreed, as a gift or in a rental contract, to allow him on the premises. In fact, then, there is no such thing as a separate “right to free speech”; there is only a man’s property right: the right to do as he wills with his own or to make voluntary agreements with other property owners. (The Ethics of Liberty, chap. 15)

Everything, then, depends on specifying property rights in such a way as to avoid conflict. How may this be done? Hoppe claims that the way to do this has been well known for centuries.

I did not discover this solution, nor did Rothbard, for that matter. Rather, the solution has been known for hundreds of years if not for much longer. Murray Rothbard’s claim to fame is “merely” that he rediscovered this old and simple solution and formulated it more clearly and convincingly than anyone before him. Let me begin by formulating the solution—first for the special case represented by the Garden of Eden and subsequently for the general case represented by the “real” world of all-around scarcity—and then proceed to the explanation of why this solution, and no other one, is correct. In the Garden of Eden, the solution is provided by the simple rule stipulating that everyone may place or move his own body wherever he pleases, provided only that no one else is already standing there and occupying the same space. Outside of the Garden of Eden, in the realm of all-around scarcity, the solution is provided by this rule: everyone is the proper owner of his own physical body as well as of all places and nature-given goods that he occupies and puts to use by means of his body, provided only that no one else has already occupied or used the same places and goods before him. This ownership of “originally appropriated” places and goods by a person implies his right to use and transform these places and goods in any way he sees fit, provided only that he does not thereby uninvitedly change the physical integrity of places and goods originally appropriated by another person. (“Rothbardian Ethics,” in The Economics and Ethics of Private Property, p. 386, emphasis in original)

Hoppe claims not only that this rule avoids conflicts in resources, but that one is rationally required to adopt it. To explain this would require an account of argumentation ethics, but it is enough for now to set out the basics of the problem of social order as this noted thinker takes them to be.