As Americans moved west over the course of the nineteenth century, the property-rights institutions they brought with them from the east evolved to meet the demands of the new conditions. The western frontier experience both changed and strengthened those institutions. The story of property rights on the frontier is captured by the experiences of three groups: the miners, the vigilantes, and the cattlemen.
When gold was discovered in California in 1848, just days before the territory was transferred by Mexico to the United States, what had been the Mexican province of Alta California had few inhabitants and little government. Located far from Mexico City and the centers of power in Mexico, Alta California’s economy focused on the hide and tallow trade between the California ranchers and passing sailing ships. Property boundaries were poorly delineated, both because Mexican law allowed “floating land grants” whose precise boundaries were to be located later and because land in California was rarely worth the cost of completing the grant process and securing full title to a specific parcel. Moreover, the government of Alta California during the 1840s had distinguished itself primarily by its corruption, with several governors spending much of their time drawing up large grants of dubious legitimacy to award to friends and family members.
When control passed to the United States, only a small military force was present in the territory and Gen. Bennett Riley, the officer in charge, quickly made clear that he considered himself lacking in jurisdiction over civil matters. Moreover, Congress took no action to organize a government for the new territory because of an inability to agree on whether the new territory would be slave or free. California was thus effectively without a government after it became American territory.
As word of the discovery of gold at Sutter’s Mill spread, people from around the world began to head for California and their chance at riches. The new arrivals quickly swamped the existing population and institutions. Faced with an almost total absence of government and the opportunity to get rich by, almost literally in many cases, picking up gold off the ground, the new arrivals had little time for politics. As most intended to stay only long enough to make their fortune, they had no reason to invest their time in anything but searching for gold or running businesses catering to the miners. (It was the latter who profited the most from the gold rush.)
Under these conditions, one might expect violence to be endemic. Such expectations could only be increased by the demographics of the mining boom: primarily armed single young men, from a wide variety of cultures and nations, sharing only a desire for wealth. Rather than violence, however, the California gold-rush miners chose contract time after time. Virtually every major mineral find in California, and throughout the West, was organized by the locators into a mining district with rules agreed on, property rights established and respected, and violence kept to a minimum.
On locating a promising site, the first group to arrive would designate one member record-keeper, establish rules governing claim size (roughly the amount of property that could be worked in a single season by the current technology), set down minimal regulations (primarily tort-based rules forbidding such things as theft, assault, and murder), and establishing boundaries. Later arrivals had a choice of accepting the rules or moving on. Because miners quickly found that there was profit to be had in selling claims, early rules restricting claim transfers were done away with rapidly and free transfer of claims became the norm. So secure were property rights that miners could leave their claims marked in the agreed fashion while fetching supplies from larger camps several days away and rarely suffer theft of the valuable tools and goods they kept in their camps.
In addition to the general conditions of peace and order that prevailed—something true of the west generally, where the stereotypical gunfights of movie fame rarely took place and where overall levels of violence were below contemporary levels in the large cities of the east—mining camps were noted for their minimalist approach to law. In a society where the opportunity cost of collective action is giving up the chance to pick up gold from the ground, miners had little incentive to devote their time and resources to anything but creating wealth. As a result, their legal codes forbade the use of force against others and theft—and little else. No one wanted to be in charge of prisoners, so punishments were generally limited to banishment; physical punishments such as ear cropping and flogging, which left criminals marked as prior offenders; and death. Record- keeping was done by an elected registrar, who was paid a fee by those using his services to compensate him for time away from mining.
Only as the population of non-miners grew did specialists in “mining the state” appear and seek to enrich themselves through the use of the state’s power. Corrupt official judges, for example, plagued the west while there are virtually no claims of corruption from the miners’ tribunals.
Miners’ law was far from perfect, but it was no worse than, and often superior to, contemporary state law. Anti-Chinese prejudice led many camps to bar Chinese miners, but the Chinese were able to organize their own mining camps in many areas and secure their rights to the property they established there. What they could not avoid were California’s official laws, which included discriminatory taxes and other restrictions.
Located far from official law enforcement, western communities attacked by criminal elements were forced to defend themselves. Two vigilante efforts in Montana Territory shed some light on how property rights can be defended in the absence of the state.
Montana’s first gold rush occurred in the Bannack-Virginia City area in 1863–64, bringing hundreds of miners to the remote region. Among them was a Californian named Henry Plummer, who soon organized a criminal gang that proved efficient at separating miners from their money. Using a spy in the stage office, secret codes chalked on stagecoaches, and Plummer’s unofficial position as “sheriff” of the two communities, the gang robbed and killed over a hundred men.
At first the miners were helpless to resist the well-organized criminals since no one was willing to stand alone against the force the Plummer gang could muster. The ability to resist the gang’s depredations was further reduced by the lack of long-term reputations, which would have fostered trust among the miners in the area. With little social capital and unsure who was involved in the gang and who was not, those outside the gang did not know whom to trust and so could not organize against it.
This problem was solved by the chance discovery that there were several Masons in the area. The bonds between Masons provided the basis for the organization of a vigilance committee to counter the Plummer gang. The Masons discovered one another when a man dying of natural causes gave a Masonic sign to his friends and discovered that two were also Masons. The dying man asked his friends for a Masonic funeral and they agreed to attempt to find enough fellow Masons to bury him with full rites. After canvassing additional miners, they located three more Masons and planned the funeral. Word spread, and on the day of the funeral 77 Masons were present.
Because the Masons trusted one another they were able to overcome the problems that had prevented an earlier response. (The vigilantes adopted 3-7-77 as their symbol and the best guess today as to the symbol’s meaning is that it commemorates the number of Masons at each of these first meetings. The numbers adorn the shoulder patches of Montana state troopers today.) Although the Plummer gang attempted to infiltrate the vigilance committee, it was never able to do so because the Masons excluded all those of whom they had suspicions. After a winter campaign 22 members of the gang, including Plummer, were captured and hanged; the remainder fled the territory.
One of the most remarkable things about the first Montana vigilance committee was its failure to use its power to settle personal or political scores. Most historians agree that the committee made at most two “mistakes.” One was the hanging of the notorious “Captain” Joseph Slade, a larger-than-life figure who was featured in Mark Twain’s account of his time in Nevada and whose regular exhibition of ears he had cut off in barroom fights earned him free drinks. After Slade repeatedly made threats against the committee, it preemptively hanged him to prevent his promised attack.
The other mistake was wrongly identifying a Mexican as part of the Plummer gang. This record is remarkable compared to contemporary state legal systems in the more “civilized” portions of the United States. It is all the more so because Montana was riven with factional disputes between Confederate and Union sympathizers, whose antipathies ran so deep that they lived on opposite sides of the creek that ran through Bannack. There is no evidence of sectional score-settling in the operation of the vigilance committee.
The second Montana vigilance committee operated 20 years later, stopping a gang of rustlers in eastern Montana and western Dakota Territory. Led by Granville Stuart, a Montana rancher, this committee operated more quietly and left fewer records. As Stuart later wrote, “The civil law and the courts had been tried and found wanting. The Montana cattlemen were as peaceable and law-abiding a body of men as could be found anywhere but they had $35,000,000 worth of property scattered over seventy-five thousand square miles of practically uninhabited country and it must be protected from thieves. The only way to do it was to make the penalty for stealing so severe that it would lose its attractions.”
Again, however, the historical consensus is that it fought only against a gang of rustlers that raided ranches across the area in the mid-1880s. Certainly their contemporaries had no problems with the vigilantes’ activities: The vigilantes won praise from most Montana newspapers at the time; Granville Stuart was elected president of the Montana Stockgrowers Association in the midst of the committee’s operations; and James Fergus, a strong defender of extra-legal activities, was elected president of the Montana Pioneers Society and had a new county named after him in 1885. Moreover, despite numerous contemporaneous conflicts over access to the range between ranchers and homesteaders, there is no evidence that this group attacked any of the ranchers’ political opponents.
Vigilantism today has a bad name, largely due to the higher-profile vigilance committees that in effect conducted a coup d’état in San Francisco in 1856 and the southern white-supremacist vigilantes. Both groups’ activities undermined rather than reinforced property rights. The important lesson from the Montana vigilante experience is that the absence of state authority does not have to produce a Hobbesian war of all against all.
Why did the Montana vigilantes succeed? Three factors made them successful examples of private
law enforcement. First, everyone involved in both committees had high opportunity costs for their time. Just as the gold miners in California had to give up time gathering gold (and perhaps finding the big strike that all miners dreamed of), so the Montana miners and ranchers who made up these efforts could profit more from engaging in mining and ranching than they could by stealing their neighbors’ property. The incentive to institutionalize their power into a means to confiscate rivals’ property didn’t exist.
Second, the general problem with private law enforcement is not that there will be too much of it but that there won’t be enough. Economists refer to this as the “free rider” problem because of the temptation we have to “free ride” on others’ efforts. If my contribution to the vigilante effort isn’t going to determine its success or failure, I might as well stay home (where I am safe and warm) and let the rest of the group risk death and injury chasing vicious bandits in the snow. If everyone feels that way, of course, the effort does fail. Indeed, one participant said, “The people bore with crime until punishment became a duty and neglect a crime.” The Montana vigilantes overcame this problem by drawing on preexisting groups. In the 1863–64 committee the Masons formed the core group and the loyalty the group inspired in its members was enough to overcome the individual incentive to free ride. The 1884 committee was formed out of the regional cattlemen’s association, a group that was bearing the brunt of the attacks. Small-group cohesion provided the means to overcome the free-rider problem.
Third, these two vigilance committees, unlike the southern white supremacists or the San Francisco 1856 committee, were organized to defend life, liberty, and property. The clear mission in support of widely accepted natural rights served to both motivate the members and to constrain the exercise of their power. Men drawn into hazardous volunteer activities, such as chasing criminals, by the need to defend their property and lives could not be easily persuaded to continue such work in pursuit of personal gain.
Cattlemen and Homesteaders
Western cattlemen found their own version of gold on the Great Plains. The buffalo hunters’ slaughter left a sea of grass ideal for cattle. The end of the Civil War, the expansion west of the railroads, and the creation of the Chicago stockyards combined to create a vast new market for beef in the 1870s and 1880s. Cattlemen began to trail range cattle up from Texas onto the plains in Wyoming, Montana, and Dakota Territories. Millions of dollars in both domestic and foreign investment poured into the range-cattle industry, with vast ranches springing up in Texas. The XIT, whose brand stood for “ten in Texas” because it covered parts of ten counties, was created by investors who received three million acres in return for construction of the $3 million state capitol building in Austin.
The problem for the cattlemen on the Northern Great Plains (Wyoming, Montana, and the Dakotas) was that federal land policy prevented them from acquiring equivalent tracts there. Texas was happy to sell its state land to anyone who wanted to buy it, enabling Texas ranchers to buy large tracts and fence them with the newly invented barbed wire. Northern Plains ranchers, by contrast, were faced not only with federal refusal to sell them land but also the federal homestead acts, which gave farmers the ability to obtain crucial tracts around water sources, effectively controlling wide areas of rangeland. Even the railroads, the other large land owners on the Plains, couldn’t sell sufficient land for a cattle ranch because their federal grants alternated tracts along the rail to prevent the railroads from gaining a “land monopoly.”
Rather than sell land to willing buyers, the approach Texa and most states took, the federal government’s homestead policies in the west prevented the rise of a property-rights solution. There are a variety of explanations for the shift from land sales to homesteading during the nineteenth century, ranging from the desire of congressmen from the manufacturing areas to maintain support for tariffs by denying the federal government the revenue from land sales, to the use of settlers on the frontier as an adjunct to army operations in dispossessing Native Americans from western lands. There is general agreement, however, that homesteading’s impact on the homesteaders was to, as Richard Stroup put it, allow them to buy land with misery. Homesteading brought settlers to frontier regions before settlement was economically viable and forced them to endure five years of near starvation in many cases to prove up their claims.
One reason that homesteaders paid such a high price in misery for their land was the federal government’s refusal to provide adequately sized tracts. Even allowing for some of the mistaken nineteenth-century beliefs about weather (rain would “follow the plow” as farming released moisture from the soil), the federal government’s refusal to follow the advice of its own experts doomed many homesteaders to failure. Major John Wesley Powell, for example, clearly explained to Congress in his reports that the acreage limits set with humid eastern conditions in mind allowed farmers far too little land for the arid west’s environment. Although the homesteaders were often ultimately unsuccessful in making their homesteads into viable farms, their impact on the cattle range was problematic. In sum, the result of federal land policy was to preclude a property-rights solution on the Northern Plains.
The contrast between the Texas ranches and the Northern Plains cattle operations, often operated by the same partnerships and companies, could not have been clearer. In Texas the ability to fence property induced investment in better quality stock, windmills to provide water, and advances in range management. Northern Plains cattlemen managed to control the open range for a time, relying on institutions such as cooperative roundups and cattlemen’s associations to allocate range rights. But these organizations were ineffective against the claims of homesteaders and sheep herders, who increasingly competed with the cattlemen for the grass and water.
In Texas the large plains ranches welcomed the arrival of farmers, for the ranches profited by selling the newcomers land and supplies. In Wyoming, conflict between homesteaders and cattlemen led to the “Johnson County War,” an attempt at mass murder of opponents of the cattlemen in northern Wyoming by a troupe of imported gunmen. The cattlemen also managed to seize control of the territorial and state governments in Wyoming, placing allies in the governor’s mansion and both U.S. Senate seats as well as controlling both houses of the legislature.
The cattlemen’s quite different experiences in Texas and Wyoming highlight the important role property rights play in creating the conditions for peace and good order. It was the existence of property rights in Texas that ensured a peaceful transition from range cattle to mixed farming and ranching. Texas cattlemen’s investments in their range and herds improved both. The Northern Plains, by contrast, saw more conflict and more violence, both caused by the imposition of institutions that prevented the development of property rights.
What does the frontier experience have to teach us today? There are three kinds of lessons that can be drawn from property rights on the frontier. First, Hernando de Soto refers to the role of property rights as among “the missing lessons of U.S. history” in his analysis of why North America has prospered while Latin America has not. Recovering the lessons of the frontier can remind us of why our society is both free and wealthy.
Second, the evolution of property-rights institutions on the frontier—in the mining camps, on the range, and among the vigilantes—can teach us about the importance of evolutionary institutions. Allowing experience to instruct the law’s development, a hallmark of the common-law process, allows the legal system to grow institutions that meet the needs of the society in which they operate. Imposing planned solutions from outside, as the federal government did with the homestead acts, risks falling for the fallacy of central planning.
Most important, the experience of the frontier teaches us that a society built around property rights is one in which peace and good order can prevail. In the mining camps, contract prevailed over violence time and again in a society of armed young men drawn from disparate cultures and lacking any of the social institutions we normally rely on to promote alternatives to violence. The Montana vigilantes showed that individuals could protect their lives and property without provoking a Hobbesian war of all against all. On the Plains the presence of property rights solved the commons problem and eased conflict between farmers and cattlemen, while the absence of property rights led to open warfare.