Posted
October 9, 2006

A Double Standard on "Takings"

In my last blog post, I reported on a new enclosure of the commons that has taken place in Europe: the privatization of the atmosphere by polluting corporations. This enclosure occurred without any compensation to commons owners. Governments simply took valuable property rights from the commons and gave them to private corporations at no charge.

How could this happen? Aren’t there laws against theft? And isn’t it government’s job to protect property, rather than to take it from one owner and give it to another?

Well, yes and no. It seems that when it comes to “takings” of valuable property, governments in Europe as well as the United States have a double standard. If the property is privately owned, it can’t be taken without fair compensation. In the U.S., this prohibition is embedded in the Constitution (“nor shall private property be taken for public use, without just compensation,” says the Fifth Amendment).

By contrast, if the valuable asset is commonly owned, no such prohibition exists. A government can take from the commons and give to private owners without the latter paying a dime. There doesn’t even have to be a “public use” to justify the taking.

Why this double standard? Why does private property receive royal treatment, while common property gets the bum’s rush?

Part of the answer is that private property is more clearly “possessed” than common property. It comes wrapped in deeds and titles that give it legitimacy and legal standing. Common property, by contrast, is generally ill-defined. There’s no piece of paper that says who the atmosphere, or the broadcast spectrum, belong to. So when Bob Dole, the former Republican Senator, said in 1995 that the broadcast spectrum “belongs to every American equally,” he had common sense, but no deed or title, to back him up. Hence Congress could blithely hand out free broadcast licenses to private media corporations, and no one could say it acted unconstitutionally.

It seems to me this is an oversight that can and should be corrected. A taking of valuable common property needs to be compensated just as much as a taking of private property. That compensation could go to government, or to a trust representing all beneficial owners. This would put an end to further windfalls for the rich, at the expense of everyone else. It would assure that common resources are used for the common good.

Perhaps, to make things crystal clear, we ought to create a new class of property – common property – that lies somewhere between private property and state property. Such property could be managed by trusts rather than corporations. Such trusts would be separate from government, and government couldn’t take and redistribute their property without compensation, any more than it could take Exxon’s. The trusts’ beneficiaries would be future generations and all living citizens more or less equally. Trustees would be legally bound to serve those beneficiaries, just as corporate directors are legally bound to serve stockholders. Each citizen’s beneficial share would be a non-transferable birthright.

One can imagine such trusts protecting common gifts such as the atmosphere, the broadcast spectrum and terrestrial ecosystems, paying equal dividends to living citizens, and supporting renewable energy, public transportation, non-commercial broadcasting and other common goods.

In short, by giving common property the same respect we give private property, we could have a market economy that takes better care of the planet and of citizens who lack private wealth. This would be a better version of capitalism than the one we have now.

Peter Barnes, a fellow at the Tomales Bay Institute, is the author of Who Owns The Sky? His new book, Capitalism 3.0: A Guide to Reclaiming the Commons, will be published on October 15.