The ViewTaxation, Regulation and Confiscation of Private Property Rights

In a liberal democracy, a property owner has the right to make use of her own assets in any way she chooses so long as she does not interfere with another’s right to use their assets as they choose.

Some moral philosophers, for example, Michael Sandel, believe it is morally unacceptable to charge a fee for using certain assets but not others. For example, it is acceptable to charge a fee for a taxi ride, but not to view a privately-owned Rembrandt and such charges should be disallowed.

If we follow Sandel’s suggestion, then two possible outcomes may result. First, the owner of the Rembrandt will only let her friends view it and the public will not be able to view it. Secondly, the government will confiscate the Rembrandt (with or without compensation to the owner) and allow public viewing free of charge.

Unless the owner is willing to accept the compensation, this would constitute a violation of her private property rights — of her freedom. The owner would have been unjustly treated in the name of a moral principle or social justice.

Property rights were at the heart of the 20th century debate over whether liberal capitalism would deliver a more just society than populist socialism. A clear answer was given — populist socialism left a much worse human rights record and produced a more unjust society, and the reason is that when private property is appropriated by society most assets become less efficiently utilised and more injustice is committed.

Private owners have a strong incentive to deploy their asset in its most productive activity, take good care of that asset and ensure its proper maintenance.