Front Page Titles (by Subject) 2: Violence and Contract - Socialism: An Economic and Sociological Analysis
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2: Violence and Contract - Ludwig von Mises, Socialism: An Economic and Sociological Analysis 
Socialism: An Economic and Sociological Analysis, trans. J. Kahane, Foreword by F.A. Hayek (Indianapolis: Liberty Fund, 1981).
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Violence and Contract
The physical having of economic goods, which economically considered constitutes the essence of natural ownership, can only be conceived as having originated through Occupation. Since ownership is not a fact independent of the will and action of man, it is impossible to see how it could have begun except with the appropriation of ownerless goods. Once begun ownership continues, as long as its object does not vanish, until either it is given up voluntarily or the object passes from the physical having of the owner against his will. The first happens when the owner voluntarily gives up his property; the latter when he does it involuntarily—e.g. when cattle stray into the wilds—or when some other person forcibly takes the property from him.
All ownership derives from occupation and violence. When we consider the natural components of goods, apart from the labour components they contain, and when we follow the legal title back, we must necessarily arrive at a point where this title originated in the appropriation of goods accessible to all. Before that we may encounter a forcible expropriation from a predecessor whose ownership we can in its turn trace to earlier appropriation or robbery. That all rights derive from violence, all ownership from appropriation or robbery, we may freely admit to those who oppose ownership on considerations of natural law. But this offers not the slightest proof that the abolition of ownership is necessary, advisable, or morally justified.
Natural ownership need not count upon recognition by the owners’ fellow men. It is tolerated, in fact, only as long as there is no power to upset it and it does not survive the moment when a stronger man seizes it for himself. Created by arbitrary force it must always fear a more powerful force. This the doctrine of natural law has called the war of all against all. The war ends when the actual relation is recognized as one worthy to be maintained. Out of violence emerges law.
The doctrine of natural law has erred in regarding this great change, which lifts man from the state of brutes into human society, as a conscious process; as an action, that is, in which man is completely aware of his motives, of his aims and how to pursue them. Thus was supposed to have been concluded the social contract by which the State and the community, the legal order, came into existence. Rationalism could find no other possible explanation after it had disposed of the old belief which traced social institutions back to divine sources or at least to the enlightenment which came to man through divine inspiration.4 Because it led to present conditions, people regarded the development of social life as absolutely purposeful and rational; how then could this development have come about, except through conscious choice in recognition of the fact that it was purposeful and rational? Today we have other theories with which to explain the matter. We talk of natural selection in the struggle for existence and of the inheritance of acquired characteristics, though all this, indeed, brings us no nearer to an understanding of ultimate riddles than can the theologian or the rationalist. We can ’explain’ the birth and development of social institutions by saying that they were helpful in the struggle for existence, by saying that those who accepted and best developed them were better equipped against the dangers of life than those who were backward in this respect. To point out how unsatisfactory is such an explanation nowadays would be to bring owls5 to Athens. The time when it satisfied us and when we proposed it as a final solution of all problems of being and becoming is long since past. It takes us no further than theology or rationalism. This is the point at which the individual sciences merge, at which the great problems of philosophy begin—at which all our wisdom ends.
No great insight, indeed, is needed to show that Law and the State cannot be traced back to contracts. It is unnecessary to call upon the learned apparatus of the historical school to show that no social contract can anywhere be established in history. Realistic science was doubtless superior to the Rationalism of the seventeenth and eighteenth centuries in the knowledge that can be gained from parchments and inscriptions, but in sociological insight it lagged far behind. For however we may reproach a social philosophy of Rationalism we cannot deny that it has done imperishable work in showing us the effects of social institutions. To it we owe above all our first knowledge of the functional significance of the legal order and of the State.
Economic action demands stable conditions. The extensive and lengthy process of production is the more successful the greater the periods of time to which it is adapted. It demands continuity, and this continuity cannot be disturbed without the most serious disadvantages. This means that economic action requires peace, the exclusion of violence. Peace, says the rationalist, is the goal and purpose of all legal institutions; but we assert that peace is their result, their function.6 Law, says the rationalist, has arisen from contracts; we say that Law is a settlement, and end to strife, an avoidance of strife. Violence and Law, War and Peace, are the two poles of social life; but its content is economic action.
All violence is aimed at the property of others. The person—life and health—is the object of attack only in so far as it hinders the acquisition of property. (Sadistic excesses, bloody deeds which are committed for the sake of cruelty and nothing else, are exceptional occurrences. To prevent them one does not require a whole legal system. Today the doctor, not the judge, is regarded as their appropriate antagonist.) Thus it is no accident that it is precisely in the defence of property that Law reveals most clearly its character of peacemaker. In the two-fold system of protection according to having, in the distinction between ownership and possession, is seen most vividly the essence of the law as peacemaker—yes, peacemaker at any price. Possession is protected even though it is, as the jurists say, no title. Not only honest but dishonest possessors, even robbers and thieves, may claim protection for their possession.7
Some believe that ownership as it shows itself in the distribution of property at a given time may be attacked by pointing out that it has sprung illegally from arbitrary acquisition and violent robbery. According to this view all legal rights are nothing but time-honoured illegality. So, since it conflicts with the eternal, immutable idea of justice, the existing legal order must be abolished and in its place a new one set which shall conform to that idea of justice. It should not be the task of the State “to consider only the condition of possession in which it finds its citizens, without inquiring into the legal grounds of acquisition.” Rather it is “the mission of the State first to give everyone his own, first to put him into his property, and only then to protect him in it.“8 In this case one either postulates an eternally valid idea of justice which it is the duty of the State to recognize and realize; or else one finds the origin of true Law, quite in the sense of the contract theory, in the social contract, which contract can only arise through the unanimous agreement of all individuals who in it divest themselves of a part of their natural rights. At the basis of both hypotheses lies the natural law view of the “right that is born with us.” We must conduct ourselves in accordance with it, says the former; by divesting ourselves of it according to the conditions of the contract the existing legal system arises, says the latter. As to the source of absolute justice, that is explained in different ways. According to one view, it was the gift of Providence to Humanity. According to another, Man created it with his Reason. But both agree that Man’s ability to distinguish between justice and injustice is precisely what marks him from the animal; that this is his “moral nature.”
Today we can no longer accept these views, for the assumptions with which we approach the problem have changed. To us the idea of a human nature which differs fundamentally from the nature of all other living creatures seems strange indeed; we no longer think of man as a being who has harboured an idea of justice from the beginning. But if, perhaps, we offer no answer to the question how Law arose, we must still make it clear that it could not have arisen legally. Law cannot have begot itself of itself. Its origin lies beyond the legal sphere. In complaining that Law is nothing more or less than legalized injustice, one fails to perceive that it could only be otherwise if it had existed from the very beginning. If it is supposed to have arisen once, then that which at that moment became Law could not have been Law before. To demand that Law should have arisen legally is to demand the impossible. Whoever does so applies to something standing outside the legal order a concept valid only within the order.
We who only see the effect of Law—which is to make peace—must realize that it could not have originated except through a recognition of the existing state of affairs, however that has arisen. Attempts to do otherwise would have renewed and perpetuated the struggle. Peace can come about only when we secure a momentary state of affairs from violent disturbance and make every future change depend upon the consent of the person involved. This is the real significance of the protection of existing rights, which constitutes the kernel of all Law.
Law did not leap into life as something perfect and complete. For thousands of years it has grown and it is still growing. The age of its maturity—the age of impregnable peace—may never arrive. In vain have the systematicians of Law sought dogmatically to maintain the division between private and public Law which doctrine has handed down to us and which in practice they think it cannot do without. The failure of these attempts—which indeed has led many to abandon the distinction—must not surprise us. The division is not, as a matter of fact, dogmatic; the system of Law is uniform and cannot comprehend it. The division is historical, the result of the gradual evolution and accomplishment of the idea of Law. The idea of Law is realized at first in the sphere in which the maintenance of peace is most urgently needed to assure economic continuity—that is, in the relations between individuals. Only for the further development of the civilization which rises on this foundation does the maintenance of peace in a more advanced sphere become essential. This purpose is served by Public Law. It does not formally differ from Private Law. But it is felt to be something different. This is because only later does it attain the development vouchsafed earlier to Private Law. In Public Law the protection of existing rights is not yet as strongly developed, as it is in Private Law.9 Outwardly the immaturity of Public Law can most easily be recognized perhaps in the fact that it has lagged behind Private Law in systematization. International Law is still more backward. Intercourse between nations still recognizes arbitrary violence as a solution permissible under certain conditions whereas, on the remaining ground regulated by Public Law, arbitrary violence in the form of revolution stands, even though not effectively suppressed, outside the Law. In the domain of Private Law this violence is wholly illegal except as an act of defence, when it is permitted under exceptional circumstances as a gesture of legal protection.
The fact that what became Law was formerly unjust or, more precisely expressed, legally indifferent, is not a defect of the legal order. Whoever tries juristically or morally to justify the legal order may feel it to be such. But to establish this fact in no way proves that it is necessary or useful to abolish or alter the system of ownership. To endeavour to demonstrate from this fact that the demands for the abolition of ownership were legal would be absurd.
[4. ]Etatistic social philosophy, which carries all these institutions back to the “state,” returns to the old theological explanation. In it the state assumes the position which the theologians assign to God.
[5. ]In Greek mythology, the owl was the favorite bird, and a frequent companion of, Athena, the Goddess of Athens (Pub.).
[6. ]J.S. Mill, Principles of Political Economy, People’s ed. (London, 1867), p, 124.
[7. ]Dernburg, Pendekten, 6th ed. (Berlin, 1900), vol. l, pt. 2, p. 12.
[8. ]Fichte, Der geschlossene Handelsstaat, edited by Medicus (Leipzig, 1910), p. 12.
[9. ]Liberalism tried to extend the protection of acquired rights by developing the subjective public rights and extending legal protection through the law courts. Etatism and socialism, on the contrary, try to restrict increasingly the sphere of private law in favor of public law.