Capitalism’s Last Frontier #23 Comte & the Act of Cultivation

Charle’s Comtes’ Traité de la propriété (1834) is the single most important work on the theory of, justification for, and origins of property.

His theory was both an historical explanation of the emergence of private property and  an ex-poste justification of how private property could be legitimate even when it had been acquired through force.  It was framed at the time of the restoration of the French monarchy when the issue of whether property rights should be restored was febrile.  Comte also criticised the popular political economists of his daym such as Say, for taking the issue of property rights as given, and outside the realm of political economy itself.

His approach was both an advancement on earlier ideas based on ‘first use’ but also a sharp break from roman legal traditions that occupation and control was itself justification for property rights.  This was for Comte abhorrent bas it was used as a justification for slavery and also historically indefensible, given contemporary liberal historians such as Thierry were documenting the acts of accumulation by dispossession of the Normans and Medieval kings.  Ideas of great rhetorical force at a time when the argument for return of land seized from nobels during the French revolution were made by the forces of conservatism.

Comtes argument then was that property rights have been often illegitimate acts of looting, but that, none-the-less, some rights to private property could be justified.  What is more he recognised that ‘first use’ was rather rare by then, confined to the edges of colonisation,  in the privatisation of national property, and occasionally in industry when new goods were invented. A far more common method of acquiring property was by work and exchange.

Very rarely amongst thinkers of his age he did not automatically assume that seizure of lands from traditional trible hunter-gatherers was legitimate.  Rather his theory was took that in such societies there were property rights but that these were not individual but “national” or communal and included established hunting grounds, and recognised tribal boundaries. So Comte challenged the legitimacy of most European settlement in the other continents.

Comte also made a radical break with the homesteading principle by arguing that it was not obvious that this created an absolute property right, including when land was held in communal ownership by other peoples.

Comtes theory took one step back from the concept of property by first developing the idea of appropriation

“(t)he action of an organised being who joins (unit) to his own body the things by which he grows, strengthens and reproduces himself” and as “the action by which a person seizes, with the intention to enjoy and dispose according to his wish, a thing susceptible of producing directly or indirectly certain enjoyments.

The process of appropriation involves the transformation of physical objects into a part of oneself for the satisfaction of human needs. Denial of these needs was a denial of human rights.

A communal “national” property consisted of non-scarce goods, such as land in hunter-gatherer societies.

Agriculture being much more efficient than hunting and gathering, private property appropriated by someone for farming left remaining hunter-gatherers with more land per person, and hence did not harm them. Thus this type of land appropriation did not violate the Lockean proviso – there was “still enough, and as good left.” 

Comte rejected as absurd the concept of a social compact by which each individual renounced their original equal right of all to property in a state of nature into packets of privately owned land.  He considered it historically inaccurate and illogical.  Rather as one of the founders of sociology Comte sought a sociological explanation

Certainly the concept of ‘first use’ is incompatible ith that of a social compact.  First use assumes that the individual cuts land from the wilderness, whilst the concept of a social compact assumes and existing common ownership.

Comte sought to explain how common ownership could develop into individual ownership and by what kind of social process.

Comte argued that what makes agriculture so different from hunting and gathering and so difficult to get started is that a time lag is introduced between production and final consumption. The labour required for hunting and gathering might be rewarded in a few hours or at worst a few days, the reward from agricultural work will not come for some months. During the months between clearing the land and the first harvest the would-be agriculturalists needed provisions to provide subistence until the harvest is ready. 

This cruso economy investment argument is helpful in considering the immediate barrier to cultivation.  However it is not fully convincing.  wndering hunter gatherers could have gathered self seeded crops at a set time each year, and the act of gathering would create further seeds.  Hence no initial investment would be needed.  If creation of breads required sedentism then intensification of gathering and proto-cultivation could eventually have led to a suplus of seeds.  

Comte considered how could the capital could be acquired to pay workers for their labour until the product can be sold or the crop harvested.  How could an individual aquire it outside the tribe?  Because of these factors Comte concludes that the transition to agriculture (and thus private property) has to come about cooperatively rather than individually. In other words there is not a clean break between the two ways of producing.

He believed that in transitional stage this “boss” or “chef de l’enterprise” is a cooperative of one or more families of a tribe. It is the cooperative who introduce a more specialised division of labour and make the necessary “economies” to accumulate the capital necessary to become cultivators. Once family cooperatives become established it was but a short step, he thought, to the full privatisation of land and farming as family members gradually spilt off to farm individual plots of land.

Before settled agriculture based on private property can emerge there must be a transitional stage of agriculture based upon a mixture of communal and individual labour and communal and private property.. His analysis is based upon ancient Roman accounts of the Germanic tribes, travellers accounts of North American Indians and the early days of the English colony in Virginia. 

The concept of a transitional famial stage of land ownership is important.  But Comte is unconvincing over the rationale for this then becoming individually owned.  We will consider this in the next section.

Whole Wild West Town for Sale – $799,000

Scenic, South Dakota (thats its real name)

Comes two jails (one working, one not), a post office, convenience store, saloon, bunkhouse, dance hall, museum, a historic train depot, two homes (one stick built, one modular) and 40 undeveloped lots, 8 abandoned homes, two abandoned schools and a former gas station. Perfect movie set, or for people that like dressing up like Carry on Cowboy at weekends.

Go to

Milton Keynes wastes £600,000 by stopping work on half built Traveller Site

Work on the 10 Pitch site at Fenny Lock has been suspended by the conservative cabinet, following a change of administration, £600,000 having already been spent on clearing woodland in preparation for the development.

Cabinet member responsible for property and accommodation Peter Geary said he didn’t want to use the reason that money has already been spent to continue to build the site, if the remainder could be better used elsewhere.

The new Conservative administration has decided to suspend any works until a ‘value for money’ review has been carried out into whether the £1.8million assigned for the project could be better spent elsewhere. on building more homes for those waiting for houses in the city.

A Government grant of £1.8million had been allocated to MK Council solely for the purpose of building a travellers’ site, but the ending of ring fencing of

Isreal House Price Protests Growing – ‘Scent of Arab Spring’

Russia Today – see previous report here also

Tens of thousands are taking part in nationwide mass protests in Israel to demand the government provide cheaper housing and lower the cost of living. The biggest protest yet, centered in Tel-Aviv, is planned for Saturday night.
On July 25, 30,000 people marched through Tel-Aviv demanding a decrease in housing prices. Some of them were carrying banners reading “Mubarak. Assad. Netanyahu.” Police arrested 42 activists – an unprecedented case for Israel.
On Wednesday Prime Minister Benjamin Netanyahu had to postpone visit to Poland due to the housing crisis in Israel
In Tel-Aviv, on the Rothschild Boulevard, people have been living in tents for weeks now protesting against expensive housing. Tent camps have been set up in various Israeli cities by students.

Israel is changing in the most inspiring and uplifting way in unprecedented wave of demonstration throughout the country and it is only the beginning of the process emerging in Israel, believes Hagai El-Ad, executive director of the Association for Civil Rights in Israel.
“People are demanding social justice on a broad variety of issues, including housing, but also health, employment and qualities of society in general,” he said.
What has begun in Israel is a very arrogant response to the Arab Spring protests which inspired Israeli protesters with a sense of “people power”, that “the country belongs to the people, and the people are rejecting economic disparities in the senseless privatization that we have seen over the last 15 years in this [Israel] country.”

Palestinian-Israeli journalist Aziz Abu Sarah agrees there is a strong connection between the present protests in Israel and the chain of revolutions across the Arab states.
“People in Israel, just like everywhere else, saw that people… can make a difference, can make a change,” he told RT. “They were using the same rhythm, the same chants almost that in Egypt people used. So, you can see a lot of parallels.”
The journalist points out that the way the protests started is almost identical to what occurred in Egypt, Tunisia and other places:
“[It] started through Facebook, through social media – that’s how people organized completely in the beginning by young people in Israel, students, people who feel that they have no future, people who feel that they can’t afford living here. So, there are a lot of parallels and things that people, the young in Israel are learning from the protests that happened in Egypt.”

Florida Land Scam Targets Gullable Chinese Investors Seeking Visas

Selling small plots at inflated prices online – such land scams are not confined to the UK.

With speculative property investors now restricted in China the cash rich have been looking abroad – and the foolish have been looking at that granddaddy of busted Property Markets Florida.

Not just any part of Florida mind but the epicentre and arguably one of the first places in the world for house prices to crash (at end of 2006) Lee County Florida.

During much of the 2000s, Lee County, Florida experienced some of the nation’s steepest climbs in housing prices. Since then housing prices there have dropped off the cliff….“Lee County rode the housing wave like a rocket,” McCabe said. “Fort Myers one year had the highest price appreciation rate in the country—47 percent in one year. There was no justification for it. The areas that went the highest have crashed the hardest. You’d think these people, especially, would have learned the lesson, and here they are trying to do it all over again.” Heartland Institute

Nearly 18% of homes in Florida are currently unoccupied, Florida has a huge oversupply of homes.

So what does a firm do when it has a large amount of foreclosed property on its books? One such company is United Solutions of America LLC which runs the ‘Invest and get paid’ website – which certainly doesn’t inspire confidence. It asks investors to invest in a property portfolio without having to get bothered with the details. The website offers no financial information about the company or its landholdings. The company specialises in buying up distressed and repossessed properties and then aggressively selling investments.

Earlier this year United Solutions of America approached SouFun International, Chinas largest on-line property auction site.

Its first auction was to sell one 1000sqm lot with a ‘valuation’ of $20,000. The site was sold through an online auction, which was open for bidding for two hours. Under the rules set for the auction, bidding could start from US$1 (RM3.02) and the site was to be sold to the highest bid above the reserved price of US$8,800. Within 55 seconds, 71 bids were placed that hit the reserve price. The winner selected by a lucky draw.

100 additional pieces of land sold out on July 22 from 73 Chinese buyers, One of them bought 20 pieces. 30 US investment immigration application forms for the Chinese group buyers who spend more than US$200,000.

120 new plots went on sale this week for a reserve of US$19,988 (i.e. just short of the ‘valuation’)

Even after buying the plots the owners will need to spend well over $20k on constructing a house.

A realistic price for a 10,000 sq’ lot in SW florida at the moment is $0.42 a sq’, meaning these plots are almost four times over value.

The ‘low’ initial asking price was meant to tempt in buyers, as is the visa offer. However in the US you cant get a visa by investing $200,000, outside areas of high unemployment you have to invest $1 million.

This is a scam. The properties are overvalued, the prospect of an investors visa is illusory and even if the lots were sold and built out the number of undeveloped plots on such subdivisions means that it could be 7-10 years before prices return. It is better to buy foreclosed houses than new individual single plots that no-none is developing.

Chinas Tax Receipt Boom – will it Offset Local Government Debt Crisis?


China’s tax revenue rose 29.6 percent to 5 trillion yuan ($773 billion) in the first half of the year, giving officials more room to maneuver as they grapple with swelling local-government debt.

With total local government debt calculated at 14 trillion yuan 3 straight quarters of such growth could, in theory, be enough to recapitalise Chinas Banks.

But the intervening period is high risk, we may see a rapid cooling of the global economy with contagion from sovereign debt crises. The fall in house prices will soon see the point where over-leveraged property developers will be reporting non-performing loans, and that will be sufficient to trigger a banking crisis.

China will need to decide on what to do with its possibly temporary mountain of cash and foreign reserves. It could use it to strategically invest in European banks, effectively a Marshall Plan for Europe, securing its largest single exporter and further shifting reliance away from the US. A good use of foreign reserves as repatriation will generate inflationary and currency pressures.

It could use it to shore up domestic banks – a good use of tax revenues in the short term only. The underlying long term problem of non-performing property loans remains valued on the basis of unrealistic speculative land prices in cities where wages are still low. What China may need is a version, or versions, of Ireland’s highly successful NAMA agency to take on distressed land assets refinance them and make them perform. Many will be going for a song if the property slump turns into a crash as is likely.

China will continue to need high fixed capital investment given its rate of urbanisation, but once this has been paid for China should consider whether its tax rates are appropriate.

Tax rates are high for an emerging economy. There is no tax free allowance for low earners and anyone earning over £4,753/annum will end up paying the maximum 35% rate of personal income tax. If China created a tax free allowance on the first few thousand yuan and lowered tax rates it would boost consumption and of course raise land values – which can then of course be taxed. A large part is likely to go on further saving giving the high savings rate. The boost to domestic consumption will be needed if export markets dry up with global recession.

Of course if China was a democracy the equivalent of their chancellor would be looking at just such a populist measure. Chinas problem is the opposite of the United States, too few politicians seeking to cut taxes rather than too many.

Road Traffic Death Rate in China 20x higher than US

“Can we live in apartments that do not fall down? Can the roads we drive on in our cities not collapse? Can we travel in safe trains? And if there is a major accident, can we not be in a hurry to bury the trains? Can we afford the people a basic sense of security? China, please slow down. If you are too fast, you may leave the souls of your people behind,” Qiu Qiming CCTV news anchor

New York Times

A comparison of government and industry data shows that the annual frequency of police-reported traffic deaths per million registered vehicles in China appears to be roughly six times as high as in the United States. And if the chronic underreporting by the police of China’s traffic deaths is factored in, the true annual rate of traffic deaths per million registered vehicles appears to be nearly 20 times as high.

A joint study last year by the Johns Hopkins School of Public Health in Baltimore and Central South University in Changsha, China, of traffic deaths throughout China in 2007 found that nearly three times as many traffic deaths showed up in the Health Ministry’s death registration data than had been reported by the police.

Auto executives and researchers say that most cars in China are designed in the West, made to Western specifications and are driven no farther each year than those in the United States. The relatively higher death toll in China, therefore, is more likely to be caused by driver and pedestrian behavior and poor road conditions, including a severe lack of roadside safety barriers, than by vehicle design or heavy usage.

Mindless Repetition in the NPPF

How can it end up saying the same thing four times in a 58 page document?

objectively assessed development needs should be met, unless the adverse impacts of doing so would significantly and demonstrably outweigh the benefits, when assessed against the policies in the Framework taken as a whole. (paras 20, 110, 165)

prepare Local Plans on the basis that objectively assessed development needs should be met, and with sufficient flexibility to respond to rapid shifts in demand or other economic changes (para 14)

12 weeks to Finalise NPPF – How seriously is DCLG taking Consultation?

Given the determination of Greg Clark to finalise the NPPF by the end of 2011 that will only leave 12 weeks after the 17th of October for the DCLG to:

-Collate and analyse responses
-Make amendments
-Produce the DCLG select committee response
-Check and Test the document
-Produce any accompanying regulations and procedures
-Produce a definitive list of all cancelled (and saved) policy documents

This simply isn’t practical unless the consultation responses are not taken seriously. It might not even be time to read through the responses and understand the concerns raised.

March 2012 would be ambitious but more realistic.

LGTU Considers Legal Challenge Against London Plan

We considered the strength of case of a legal challenge earlier in the week

Planning Resource reports

Gill Brown, a spokeswoman for the LGTU [London Gypsy and Traveller Unit], said the body was considering a legal challenge. She said there are “questions to be asked about the lawfulness” of the decision due to the recent CALA Homes case in which a judge ruled that plan-makers should not take the Government’s intention to abolish regional strategies into account when preparing plans.

But a spokesman for the mayor said the LGTU had misinterpreted the result of the case. The spokesman said: “The CALA ruling was clear that this only applied to strategic planning documents outside of London. We are certain we have followed the rules.”

However, David Heales, a solicitor at law firm Clyde & Co, who represented CALA, said LGTU might have good grounds for a challenge on the basis that the ruling does apply to London. But he added: “By the time it came to court, the regional strategy regime would probably be abolished, so it wouldn’t reverse the policy.”

The GLA is on shaky ground here. CALA II only specifically mentioned RSS (outside London) because that was the instance before it, but its gneral principle applies more widely.