I have long argued that the public values democracies discover and implement are an essential part of a free society. Market fundamentalists generally ignore the argument although many now acknowledge that a democracy is a spontaneous order, which is a start. I recently read of a kerfluffle among libertarians in New Hampshire that illustrates my point, and the legitimacy of the democratic process.
A libertarian activist was sentenced to prison for refusing to remove a couch from his back yard, and for an escalating series of problems that arose from the initial charges. Based on what I have read, what is happening is an abuse of law by the courts in Keene, New Hampshire. The guy appears to be getting screwed over. But there is another issue here that goes to the core of the coherence of the libertarian argument the free market is the measure of freedom and individual choices. It is this issue I want to explore.
Apparently under Keene’s municipal ordinances, it can be illegal to have a couch in your back yard. Unreasonable? I think so, but let’s think of another example. A homeowners’ association makes rules as to what is and is not acceptable outside a member’s home. It decides a couch is not acceptable. I know many times outdoor clothes lines are not acceptable, so it is easy to imagine them not accepting a couch. Are they in the right? It is a contractually organized association and no one had to buy a home there. I cannot imagine a free market advocate coherently objecting.
A lot of interesting issues arise from this possibility, but I will concentrate on only one. Clearly the homeowners’ association as well as the town of Keene objected to couches and clotheslines because they could be seen off the property. Photons depicting these objects crossed boundaries and invaded the vision of un-consenting others. Photons cross boundaries all the time, but sometimes their crossing is ruled a trespass and sometimes not. There is no objective line to determine when a trespass has occurred and when not. The same issue applies to sound with the added problem that sound waves are not even physical in the sense that photons can be.
If Keener were a homeowners’ association, libertarians would likely agree with its right to make a rule about what can or can not be visible from off-property. Their objection to Keene’s rules would have to rely not on the rules themselves, but on the fact that Keene is a democratic political body, not a market rooted homeowners’ association. And yet this distinction will not bear the weight such an argument places on it.
Boundaries must be discovered
Clearly boundaries do not define themselves. They must be determined, and when people disagree as to what the boundary is, it must be determined in a way that guarantees at least one person will disagree with the outcome.
The choice is either force or a procedure where even the loser agrees the outcome was arrived at fairly. In this latter case it is analogous to a game where the ultimate loser plays by rules that will lead to his or her defeat, but which were agreed to in advance as fair. The requirement that all agree on a fair procedure leads us to some version of majority decision because at the minimum no one would accord a heavier weight to another when by doing so they increase the likelihood of losing on future decisions of some importance to them.
At this point we arrive at the principle of one-person-one-vote as an essential aspect of the process if it is to be regarded as fair. In itself it may not be enough, but it must be a part of the process. This principle helps establish a procedure for discovery of common rules. As part of a discovery process neither this principle nor any other can guarantee success in any given instance, but no discovery process be it the market or science can make this guarantee.
Nevertheless, even with the possibilities of error, the process must be employed and attempts made to discover public values that at least a majority of citizens will approve as either good in themselves or fairly made.
The definitions of property rights are public values. They cannot be decided by market mechanisms because those mechanisms work only after property rights have been defined.
The libertarian homeowners’ association presupposes that property rights have already been defined. Even if they had initially been defined through custom, as conditions change new problems arise, and even if the courts rely on common law to make a ruling, the presupposition of fairness remains or else the losers will simply be coerced. As an economy develops people are linked together with greater intensity, boundary issues continue to arise (no one wanted to put a muffler on a horse), and more rules must be made. This is one reason why there are more limitation on some kinds of behavior in cities than in the country side, yet cities allow for a richer life with more choices than the countryside. There is no one-to-one correlation between the amount of liberty a person enjoys and politically discovered and governmentally enforced rules that limit some kinds of actions.
A further step then opens up. Property rights as is now pretty universally acknowledged are bundles of discrete rights. Some kinds of private property have different bundles than do others. I think all reasonable people would grant that I do not have a property right to torture and dismember my cat or dog. Hiwever I can chop up my couch. “Private property” constitutes different bundles in these two cases. This leads to another insight:
Property rights are rights to enter into a range of relationships with others and with what is owned. Regarding what is owned, that relationship may be “despotic” in Blackstone’s sense of “that sole and despotic dominion which one man claims and exercises over the external things of the world, in total exclusion of the right of any other individual in the universe.” Or it may be limited, as Blackstone himself apparently did in practice.
If we have fair and equal procedures for determining what constitute the appropriate relationships into which we may enter with others, we have left the realm of economic theory and entered into political theory. I am not discussing here what might be the best institutional framework for instituting fair democratic rules (government, co-op, or something else) nor whether they should be simple majority decision-making or whether other procedures ultimately rooted in that principle, such as a bill of rights, might be superior.
Here I am only arguing that even the most devoted of libertarians, once they face the actual problems of living together, cannot avoid those issues, nor can they avoid the argument that at its root a rule based on the equal voice of all must play a crucial and foundational part of this process of discovering the public values that a given society will live by.
Studies in Emergent Order 
David
October 3, 2011
This is a very good illustration of property rights theory (bundles of rights, discovery of new valued resource attributes etc.), but it also alludes to the importance of the spatial domain of the specific delineation of a bundle of property rights. What I’m saying is that a couch-in-your-backyard ban is a much less serious problem (from the point of view of dissenting individuals) if it only applies in Keene, NH, and a few other small places than if it were a statewide or – worse – federal ban. But (this is also an important qualification) only if the “attachment value” of the activist to his present house is moderate — i.e. he should be able to envision living in other communities with different property right bundles.