The Ethics and Economics of Private Property II

"...Finally, an ethic must not only have permanency and stability with changing circumstances; an ethic must allow one to make a decision about "just or unjust" prior to one's actions, and it must concern something under an actor's control.

Such is the case for the classic private property ethic with its first-use-first-own principle. According to this ethic, to act justly means that a person employs only justly acquired means—means originally appropriated, produced, or contractually acquired from a previous owner—and that he employs them so that no physical damage to others' property results. Every person can determine ex ante whether or not this condition is met, and he has control over whether or not his actions physically damage the property of others.

In distinct contrast, the wealth maximization ethic fails in both regards. No one can determine ex antewhether or not his actions will lead to social wealth maximization. If this can be determined at all, it can only be determined ex post. Nor does anyone have control over whether or not his actions maximize social wealth. Whether or not they do depends on others' actions and evaluations. Again, who in his right mind would subject himself to the judgment of a court that did not let him know in advance how to act justly and how to avoid acting unjustly but that would judge ex post, after the facts?

[4] Note the "natural law" character of the proposed solution to the problem of social order—that private property and its acquisition through acts of original appropriation are not mere conventions but necessary institutions (in accordance with man's nature as a rational animal). A convention serves a purpose, and an alternative to a convention exists. For instance, the Latin alphabet serves the purpose of written communication. It has an alternative, the Cyrillic alphabet. Hence, we call it a convention. What is the purpose of norms? The avoidance of conflict regarding the use of scarce physical things. Conflict-generating norms contradict the very purpose of norms. Yet with regard to the purpose of conflict avoidance, no alternative to private property and original appropriation exists. In the absence of prestabilized harmony among actors, conflict can only be prevented if all goods are always in the private ownership of specific individuals and it is always clear who owns what and who does not. Also, conflicts can only be avoided from the very beginning of mankind if private property is acquired by acts of original appropriation (instead of by mere declarations or words of late-comers)."

The Ethics and Economics of Private Property, by Hans-Hermann Hoppe