Proudhon and the labour theory of property.

Author:Strong, Derek Ryan
Position:Pierre-Joseph Proudhon - Critical essay

The French mutualist anarchist Pierre-Joseph Proudhon (1809-65) is best known for his treatise What is Property? and his famous answer to that question was: property is theft! (1) The main objective of his book was to establish the grounds for the just appropriation of private property. Proudhon's book is part of an extensive body of work which remains important because it provides a comprehensive and viable alternative to capitalist economics, in both theory and practice. Property, furthermore, occupies a central place in his theory. Other varieties of anarchist economics, namely, libertarian communism, arguably lack such a practical vision, even though they continue to exert a powerful force on anarchist imagining. This paper outlines features of Proudhon's ideas to show that they deserve more serious attention than they have received in recent years. Importantly, the nature and acceptance of private property (and, along with it, markets) is what distinguishes the various strands of anarchist economic thought. This paper will first discuss Proudhon's views on property and then discuss economist David Ellerman's views on property (as a means to reinterpret Proudhon). Next, it will compare and contrast the two primarily with regard to the labour theory of property, the main area of comparison, being sure to highlight areas of divergence. Lastly, it will consider other normative arguments related to the labour theory of property that go beyond the theory's simple jurisprudential nature.

Proudhon advocated a type of private property but he distinguished between 'possession' and 'property'. 'Possession' is justly appropriated private property. 'Property', on the other hand, is unjustly appropriated private property. The difference rests on a labour theory of property which states that since labour is the only responsible agent in the production process only labour should appropriate the goods produced. (2) Recognising the principle of responsibility that is central to the labour theory of property, in What is Property? Proudhon argued:

Capital, tools, and machines are likewise unproductive. The hammer and the anvil, without the blacksmith and the iron, do not forge; the mill, without the miller and the grain, does not grind, etc. Put together tools and raw material; place a plough and some seed on fertile soil; enter a smithy, light the fire, and close the shop, and you will produce nothing. (3) Only people, and not things, are responsible for production. From this starting point Proudhon distinguished between 'possession' and 'property'. He defined 'property' as simply a de jure 'right of domain over a thing'. (4) He defined 'possession', on the other hand, as a de facto phenomenon. Property, then, was theft because those who legally appropriated the products of labour in capitalism were not actually responsible for production. He wrote:

From the distinction between possession and property arise two sorts of rights: the right in a thing (jus in re) is the right by which I may reclaim the property which I have acquired, in whatever hands I find it, and the right to a thing (jus ad rem), which gives me a claim to become a proprietor ... As a labourer I have a right to the possession of the products of nature and my own industry, but as a proletarian I enjoy none of them; and so by virtue of the jus ad rem I demand admittance to the jus in re. (5) Following Pederson (2010) it is possible to treat 'possession' as a type of private property within a concept of property in general, understood as social relations with regard to things:

Property relations are not only exclusive, private property rights as instantiated within capitalist democracy (that is, a particular conception of property). As a jurisprudential concept, property can be used to understand, analyse, reflect upon and organise social relations with regard to things in any context (this is the general conception of property). (6) From this perspective it becomes clear that property in general includes not only private property but also common property. It is also possible, as Pedersen argues, to identify 'the different kinds of configurations of property that might be grouped under the term private'. (7) He suggests a schema using three main variables:

What this framework reveals is that property, as patterns of conventions structuring social relations with regard to things, always refers to (i) a social group amongst whom the relations hold and are performed (the relating subject), (ii) some resource, object or set of objects with regard to which the relations hold and are performed (the related-to object), and (iii) the way in which the relations are shaped, that is constrained and/or enabled, through normative protocols (the relational modality). (8) Private property in general denotes the exclusive rights assigned to an individual or specific group of people to access, use, and govern a resource, object, or set of objects in a particular way. It is in this sense that Proudhon's 'possession' is a type of private property, but one with a different relational modality from capitalist 'property', in that it does not enable exploitation. 'Possession' can perhaps be termed, in keeping with Proudhon's social philosophy, mutualist private property.

Although Proudhon is rarely discussed in mainstream economics, it would be a mistake to think that his ideas have no purchase in contemporary thought. Indeed, Proudhon's distinction between 'possession' and 'property' resonates with the work of the economist and philosopher David Ellerman. Ellerman's modern restatement of the labour theory of property is not presented from an anarchist perspective, however. He holds some views that diverge from Proudhon's, which will be elucidated as the analysis here develops. Nonetheless, Ellerman's work is important because it provides a more effective, if more technical, way of presenting and defending the labour theory of property. He explicitly identifies intentionality (or responsibility) as the distinguishing characteristic of labour in the production process vis-a-vis the other factors of production, which has eluded both orthodox and heterodox economists alike.

Ellerman defines the labour theory of property as an economic application of the basic juridical principle of imputation. This principle states that '[p]eople should have the legal responsibility for the positive and negative results of their intentional actions'. (9) The only intentional or responsible agent in the production process is labour. Only people (i.e., labour) are responsible for production and not things (i.e. capital). Consequently, the labour theory of property states that '[p]eople should legally appropriate the positive and negative fruits of their labor'. (10) Ellerman uses this framework to analyse the production process in both capital-managed (i.e., capitalist) and labour- managed firms.

In a capitalist firm, owners of capital hire in labour to produce goods. Labour is de facto responsible for production but not de jure responsible. The capital owners take legal responsibility and thus are the residual claimants who pay for the input factors, appropriate the products of labour, and receive the net value of those products. The capitalist firm, however, violates the labour theory of property as defined above. If labour is always de facto responsible for production, then labour should always be de jure responsible. This requires labour-managed firms (i.e., worker co-operatives) where labour hires in capital to produce goods. Workers would then...

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