Discussion Group Report

"As the American Founders knew and as generations of serious students have long known, an ownership society is a society of responsibility, liberty and prosperity," says Dr. Tom Palmer in an article with the same name as this present article by the Cato Institute in January, 2004. "A number of policy initiatives--including creation of personal retirement accounts, expansion of medical savings accounts, and school choice--have been proposed recently that seek to strengthen an 'ownership society.' Such initiatives build on a long and deep tradition."

He cites Aristotle: "What belongs in common to the most people is accorded the least care: they take thought for their own things above all, and less about things common, or only so much as falls to each individually." Thomas Aquinas made a similar observation. The philosopher John Locke rested personal identity itself on the idea of ownership.

Palmer contends, "Owners have a right to benefit from the wise use of their property and therefore incentives to take care of it. Similarly they bear the consequences of unwise management. Not only are they more likely to care for what they own, but a system of property requires people to treat others with respect, as well." They can exclude others from the use of what belongs to them. Each owner must respect the rights of others and concern himself with their interests. Property makes people--including lawmakers--respectful of others, he says.

John Locke saw society as founded on the "mutual Preservation of their Lives, Liberties and Estates, which I [Locke] call by the general Name, Property." Property is a necessary condition of independence. Without ownership of printing presses, paper and ink, there can be no free press. Without ownership of land and buildings, there can be no freedom of association, no freedom of common worship, no freedom of action generally. A free society is of necessity an ownership society.

Ownership makes markets possible, and markets make prosperity possible. Ownership channels the efforts of millions of persons who are unknown to each other into corporations to produce wealth, rather than into the squabbling and conflict characteristic of political control. It is the foundation of a society of widespread and growing prosperity. The extension of ownership rights into fields that have been dominated by government power--including social security, medical care and schooling--represents an opportunity for Americans to enjoy in their retirement planning, their medical care and the education of their children the responsibility, freedom and prosperity that only ownership can make possible, says Palmer.

David Boaz in his article, "Defining an Ownership Society," also published by the Cato Institute in January, 2004, points out that President Bush wants an ownership society. Benefits Boaz claims for such a society include responsible homeowners, responsible citizens, and people who feel more dignity, pride and confidence. They have a stronger stake, not just in their own property, but in their community and their society. Margaret Thatcher, in privatizing Great Britain's public housing, believed that that action would make homeowners more responsible citizens and see themselves as having a real stake in the future and quality of life in their communities, and, yes, that they would be more likely to vote for lower taxes and less regulation.

The United States has the most widespread property ownership in history. Increasing numbers of Americans are becoming capitalists--people who own a share of productive businesses through stocks or mutual funds. But about half of Americans are not benefiting as owners inthe growth of the American economy, though they still benefit as wage-earners and consumers. In general these are the Americans below the average income. The best thing to do to create an ownership society is to give more Americans an opportunity to invest in stocks, bonds and mutual funds so that they, too, can become capitalists, argues Boaz.

It is obvious how to do this, he says. Every working American is required to send the government 12.4 percent of his or her income up to about $88,000 via payroll taxes. But that money is not invested in real assets, and it doesn't belong to the wage earner who paid it. It's used to pay benefits to current retirees. If we want to make every working American an investor--an owner of real assets, with control of his own retirement funds and a stake in the growth of the American economy--then we should let workers put their Social Security taxes into private accounts, like IRAs or 401(k)s. Other reforms that enhance the ownership society include school choice, giving parents the power to choose the schools their children attend, and wider use of Health Savings Accounts, which transfer control over health care decisions from employers, insurance companies and HMO gatekeepers to individual parents.

An ownership society, says Boaz, can also improve environmental quality. People take care of things they own, and they're more likely to waste or damage things that are owned by no one in particular.

That's why timber companies don't cut down all the trees on their land and instead plant new trees to replace the ones they do cut down. When the government owns all property, individuals have little protection from the whims of politicians.

The Cato Institute, the publisher of these articles, is generally described as a conservative libertarian organization. The above-mentioned generalized statements are presented as established fact with little or no objective evidence to support them except quotations from writers or philosophers, who are presenting their personal opinions. These may or may not accurately reflect the real world.

I would like to see every family own its own home, but we might ask the questions: Does ownership necessarily induce people to act responsibly? Are there no people who abuse others or exploit them by wielding unjustly the immense power they have gained by controlling large amounts of ownership of property and money? What protection does the "ownership society" give other people from them? Has America ever seriously considered allowing the government to own all property, as in Boaz's extreme example about the whims of politicians? Does our economy realistically give low wage earners or the unemployed a fair chance to participate in the "ownership society"? Is it true that timber companies don't cut down all the trees on land they own without replacing them? Hasn't Boaz ever seen the egregious examples of the clear-cutting of vast tracts of forest land by corporations (large owners of property)? Or of the air pollution some corporations cause? Does it really serve our best interests for us to give up the security of traditional social security to gamble retirement savings on chancy investments in private accounts? Or to undercut the public school system by using tax money to fund private schools? What about separation of church and state? These are questions we need to consider carefully before we jump whole hog into an "ownership society." We may find ourselves living in a debased society if we abandon some of our governmentally managed programs, such as national parks, public schools and environmental protection.