Friday, July 20, 2012

About Locke Smith

(The following is a discussion post from a past assignment for a 300 level government class)

John Locke understood all property as originally being held in common from God, and based the idea of just property acquisition on the process of mixing one’s own labor with a previously common and abundant resource. Through adding labor to a resource it becomes legitimately owned private property. For example, a person would be able to make property claim on a parcel of land if he is able to make use of it through farming, or he could also use the previously common trees and carve out canoes for use or sale. Someone, however, cannot legitimately make a claim to a huge geographic region of uninhibited land—he (or she) can pretend to—but does not possess the actual property right because they would not be able to make use of the vast space; it would be an empty declaration. The act of original appropriation is referred to as the homesteading principle. Locke argued that a field that is tended by human labor to harvest food is worth more than a field left untouched because the productivity of the land has been improved, adding value to the overall material standard of living of those who work or purchase food that would otherwise be more scarce in a state of nature. Through this process money had organically emerged by mutual consent as a means of exchanging perishable goods for non-perishable goods; it also allowed for the more efficient transactions between all goods, which in turn created an environment for humans to think and plan more for the long-term. In a way it is following Genesis 1:28 in subduing the earth by the ability to far more easily invest in long-term capital projects that otherwise would not be possible, or, at the minimum, would prove very difficult to accomplish on such a complex, large scale.

I find the Lockean concept of private property and its acquisition potential to be of critical importance for a peaceful, civilized, and free society. Two particular principles discussed by me earlier that I am familiar with have been developed from Lockean thought: the principles of self-ownership and non-aggression. In other words, "every man has a Property in his own Person” (Strauss, 1997, p.486) and by mixing previously common property with labor it becomes legitimate private property by the individual doing the “mixing.” When any outsider acts with unjust use force (aggresses) or makes a threat against that person or their property, it is to be considered an act of war (Strauss, 1997, 479).  From this reasoning it can be deduced that in nature individuals have God-given rights of life, liberty, and property. These general principles are compatible with Scripture and necessary for voluntary peaceful human civilization.

The rejection of private property rights implies that some greater authority other than one’s self is at play. Many would say that everything is Gods property, which is true, but the rejection of private property rights for individuals on earth logically implies that someone or some group of fellow humans must have rights over other persons and their justly acquired property. I was reminded of an article about a secret agreement that revolutionized China: the secret agreement was to illegally subdivide the previously collectivized property of the village of Xiaogang into family units, and the families would be able to keep any surplus they created rather than be forced to share it. The result of this seriously life threatening agreement was an increased harvest “more than the previous five years combined” (Kestenbaum & Goldstein, 2012). The rejection for private property can naturally include people, too, if it is for the “general will” or “common good.” In the same article, a farmer asked the communist party officials if he even owned the teeth in his mouth. The party replied “No. Your teeth belong to the collective” (Kestenbaum & Goldstein, 2012). This is only one example of the disastrous effects of the rejection of property rights for modern human civilization. Today there is both theoretical and empirical evidence supporting property rights. The latter is found throughout human history but especially in the 20th century like the example above. The former is supported from many valuable angles too, but the most devastating is the problem of rational economic calculation under a socialist commonwealth, otherwise known as the economic calculation problem (ECP) (Horwitz, 1998, p.430). 

Adam Smith did essentially advance an argument that is similar to the Lockean perspective but he focuses more on moral and economic thought. He seemed to view man as social with natural sentiments that are both self-interested and compassionate for those being oppressed and treated unjustly (Strauss, 1997, p.644). In general contrast to Hobbes and Rousseau, Locke and Smith saw that man in general has both self-interested and sympathetic passions. Both saw a form of limited government with individual freedoms as being most conducive to a peaceful, prosperous civil society. Hobbes and Rousseau, on the other hand, favored certain governments that may appear differently and have opposing foundations from each other, but both placed no limitations of the “absolute sovereign” or the “general will” over the individual.

Like most classical economists, Smith generally held to a labor theory of value. It shouldn’t be denied that labor does indeed play the primary role in the just acquisition of property. The implications of this theory for early laissez-faire economic analysis are fairly negligible, but when alternative systems of economic organization are planned on the basis of this theory, such as Marxism, there are significant problems. Labor cannot be considered as the lowest common denominator from which to rationally calculate and allocate scarce resources in a complex economy with the division of labor (Mises, 1981, p. 101); this is the foundation of the economic calculation problem. Without relative money prices derived from the aggregate decisions of consumers and suppliers in a market economy based on private ownership of the means of production, it is impossible for rational economic calculation; prices are packed with and relay crucial information to everyone about the relative scarcity and demand. Trying to find the relative ratios in labor from a doctor to a janitor and the millions of other occupations is impossible even with a super computer because it cannot account for value that is subjective.

Smith also recognized and put extra emphasis on the relationship between intention and consequences, specifically the convergences and divergences between good intentions and socially desirable outcomes. Paradoxically, when people pursue their self-interest under generally accepted norms of behavior with institutions that legitimately enforce and punish those who resort to the use of force or fraud, they grow wealthier as a whole. “It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest” (Smith, 1776, p19). Private ownership of the means of production under the social structure of division of labor was to him, and many today, “the system of natural liberty.”


Cahn, S. M.  (2002). Classics of moral and political philosophy.  New York: Oxford University Press.  ISBN: 0-19-514091-5. 

Horwitz, S. (1998). Monetary Calculation and Mises's Critique of Planning. History Of Political Economy30(3), 427-450.

Kestenbaum, D. & Goldstein, J. (2012, January). The Secret Document That Transformed China. Retrieved on June 20, 2012, from

Locke, J. (1764). Two Treatises of Government, ed. Thomas Hollis (London: A. Millar et al., 1764). Accessed from on 2012-06-04

Mises, Ludwig von. (1981) Socialism: An Economic and Sociological Analysis. J. Kahane, trans. 1981. Library of Economics and Liberty. Retrieved June 21, 2012 from the World Wide Web:

Smith, Adam. An Inquiry into the Nature and Causes of the Wealth of Nations. Edwin Cannan, ed. 1904. Library of Economics and Liberty. Retrieved June 20, 2012 from the World Wide Web:

Strauss, L., & Cropsey J. (Eds.).  (1997). History of political philosophy (3rd Ed.).  Chicago: University of Chicago Press. ISBN: 0-226-77710-3.