All Commentary
Monday, November 1, 1965

A Clich of Socilaism: Under Public Ownership, We the People, Own It!

Public ownership and govern­ment control are synonymous terms—two ways of expressing an identical concept.

The popular notion is that a re­source or service is the possession of we, the people, when it is un­der government ownership and dispensation, and that we, the peo­ple, are objects of exploitation when resources are under private ownership and willing exchange. Socialism—public ownership—will continue to expand as long as this notion dominates.

In Brazil, for instance, private exploration and refining of oil re­sources are denied to both domestic and foreign entrepreneurs. Gov­ernment has a monopoly of this industry. As a consequence, Bra­zilians innocently exclaim, “0 pe­troleo é nosso”—the oil is ours! But if they will only look in their gas tanks, they’ll discover two gallons from private enterprising foreigners to each gallon of what they naively call “ours.” The reason for this? Government owner­ship and operation produces only one-third the quantity required for local consumption; some 200,­000 barrels must be imported daily.

Had our Indians followed the Brazilian type of logic, they could have exclaimed, 500 years ago, “The oil is ours,” even though they were unaware of this untapped re­source. Or, to suggest a compa­rable absurdity, we can, after planting the American flag on the moon, claim that satellite to be “ours.” I only ask, what’s the point in avowing ownership of any unavailable resource or ser­vice?

Public ownership, so-called, con­trary to popular notions, is defi­nitely not we-the-people owner­ship. If it were, we could exchange our share in TVA or the Post Office for dollars, just as we can exchange a share of corporation stock for dollars.

At least two conditions are necessary for ownership to exist: (1) having title, and (2) having con­trol. In Italy, under fascism, titles to assets remained in private hands but control was coercively assumed by the state. The titles were utterly meaningless. Without control, ownership is pure fiction.

While in some vague way “we, the people,” are supposed to have title to TVA, for instance, we have not even a vestige of control. I no more control that socialistic ven­ture in power and light than I control the orbiting of men into outer space. “But,” some will counter, “neither do you control the corporation in which you hold stock.” True, I do not perform the managerial function, but I do con­trol whether or not I’ll retain or sell the stock, which is to say, I control whether or not I will share in the gains or losses. Further, I am free to choose whether or not to work for the corporation or to buy or refrain from buying its products. My control in the non­governmental corporate arrange­ment is very real, indeed.

Who, then, does control and thus own TVA, the Post Office, and the like? At best, it is a nebulous, shifting control—often difficult to identify. Rooted in political plun­der, government ownership and operation is an irresponsible con­trol; that is, there is never a re­sponsibility in precise alignment with authority. The mayor of a city may have complete authority over the socialized water system, but responsibility for failure is by no means commensurately as­sumed by him. He “passes the buck,” as they say. Most people crave authority provided responsi­bility doesn’t go with it. This ex­plains, in part, why political office is so attractive and why “we, the people,” do not even remotely own what is held in the name of public ownership.

One truly owns those things to which he holds exclusive title and exclusive control, and for which he has responsibility. Let any American inventory his posses­sions. These will be, preponder­antly, those goods and services ob­tained from private sources in open exchange: power and light, cameras, autos, gasoline, or any of the millions of goods and ser­vices by which we live. The things that are privately owned by others are far more available for one’s own title and control than is the case in “public ownership.”

Public ownership often creates distracting and, at the same time, attractive illusions. For instance, people served by TVA are using twice as much power and light as the national average. Why? TVA charges less than half the price. Because of lower production costs? Indeed, not! The rest of us around the nation are taxed to cover the TVA deficit. But power and light acquired in this manner can no more classify as “ours” than can any good or service forcibly ex­torted from true owners. To grasp what this socialism means if ap­plied to everything, merely take a look at the Russian “economy.”

Or take another example: The political head of New York City‘s socialized water system rejected metering on the ground that water is a social service to which Goth­amites are entitled as citizens. The illusion: How nice to live where much of the water is for free! Yes, except that the New York City water district, astride the mighty Hudson, is having a waterfamine. Now, this is public owner­ship, pure and simple. But observe that the “public” ownership of water has all but dried up the availability of water for private use. What kind of a social service is it that, by depriving individuals of title and control, finally denies them the service!

If private availability—owner­ship in the sense of use, title, con­trol—is what interests us, then we will do well to preserve private ownership and an open, willing-exchange market. For proof, mere­ly take a look in the gas tank, or the closet, or the garage, or the pot on the stove!

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Problems of Compulsion

Amending the Social Security Act to exempt the Amish from coverage and taxation, on grounds that insurance is contrary to their religion, embraces the idea that different laws shall apply to different religions.

Personally, I want the same law to apply to all—regardless of religion or race. But if that concept of justice is to prevail in the United States with its compulsory Social Security laws, the peace­ful Amish farmers must be deprived of their freedom to worship God as they think right.

If Social Security were voluntary instead of compulsory—and if all its costs were paid by those who choose to join—Congress would not be faced with this issue of different laws for different religions.

Dean Russell

  • Leonard E. Read (1898-1983) was the founder of FEE, and the author of 29 works, including the classic parable “I, Pencil.”