Neighbortarianism

This thesis was inspired by opposition to uncontrolled immigration from a libertarian standpoint. Pro-control treatment of immigration is usually utilitarian: The threat posed to neighbors by the invitation of dangerous foreign races is a clear-cut instance of a negative externality that the property norm protects neighbors from. The aesthetic externalities of diversity are usually ignored. They should not be because they have a materially adverse effect on property values. The following is the case as to why damaging neighbors’ property prices is a violation of the property norm and therefore should be protected by legal default.

The most appropriate place to begin this case is at the beginning of property appropriation, a.k.a. homesteading. Homesteading is an act of value creation primarily but not exclusively for the homesteader. This value has not only subjective but objective properties. This is because purely subjective deference to a homesteader’s land use by neighbors is usually not a sufficient basis for peaceful relations. While it is technically possible for neighbors to cede an unlimited amount of virgin land to a homesteader, regardless of the extent of his labor, it is far more likely that the actual extent of his boundaries will closely approximate the extent of his labor because that is the means by which he creates value for them that is objectively marked by trade. Homesteading labor is a dangerous and difficult business. Clans who homestead mostly have to fend for themselves against wild animals and bandits at serious risk to their lives. Part of the value homesteaders create is simply keeping a parcel of land clear of these threats. Forest must be cleared for farming. Rocks must be removed from the soil. If suitable building material is not locally available, a house must be constructed at great expense from material transported over great distance. Successful homesteaders are therefore much more courageous and industrious people than latecomers on average.

Because prices can come about only through trade, and trade can occur only with ownership, the price of unowned land is effectively zero. The price that others pay for homesteaded land is therefore an objective record of the value the homesteader creates. Even though we cannot directly measure the property’s utility for the buyer, we do know that the buyer values the property more than whatever he paid for it. The buyer accepts the risk of future fluctuations in the real estate market as a whole, but he hopes that latecoming neighbors, while perhaps not increasing the price, will at least respect the sweat equity built up by the homesteader by refraining from diminishing it. This expectation comes from both self-interest and admiration for the homesteader’s efforts. The subject of discussion thus far is a moral agenda, so we must go further to see why it is also a legal one.

Despite the significant difference between law and morality; there is no purpose of law but to mitigate immorality. Immorality means behavior that negatively affects us on the level of existence itself. There are a number of immoral behaviors, however, that we libertarians are staunchly opposed to legislating against because it is grossly impractical to do so. Impracticality results from a significant degree of subjectivity regarding a behavior’s degree of destructiveness or because the behavior can be concealed easily enough that trying to curb it effectively would require an unacceptable degree of surveillance. Other behaviors, however, are objectively and overtly destructive enough to others to justify intervention with deadly force. What is key here is that it is not whether a behavior is destructive or not per se that determines whether it is legally actionable. It is that there is objective evidence of of material destruction caused by one person of agency to the property of another. A property boundary is an objective criterion of legal action that determines the parties involved in a possible crime in terms of where a behavior occurs in relation to it. It is not the behavior by itself. Usually sitting around isn’t a crime but it is if it is on someone’s property without their permission, even if no material on the property is damaged. A youth sitting around his parents’ house may become a criminal if he is legally judged to have become an adult and his parents feel he has overstayed his welcome. How parents feel about their children, including the judgment of attaining age of majority, is subjective within objective family norms. However, the fact of having made and recorded the judgment is an objective fact that is legally actionable. A subtle but important point here is that it the absence of permission, not disobedience of a request to leave, that makes trespass a crime. Regardless of how the property owner subjectively feels about the trespasser or whether they even know the trespasser is present, the fundamental imposition is the compromise of the owner’s potential for usage of the property simply by occupying space in it. How someone wishes to use their property is subjective; the constriction of potential usage combined with absence of permission is an objective criterion of crime. If an owner hunts on his property and a shot accidentally catches the trespasser, the owner is burdened with disposing of the trespasser somehow. Although presence on another’s property is not determinative per se, trespass is an obvious case of property norm violation. Violation does not, however, require a person himself to cross a physical property boundary. Many cases of fraud do not require such invasion. In the case of “fractional reserve” banking, a bank need not do anything physically to a depositor’s receipts; the crime lies purely in creating and lending out counterfeit copies of the receipts, which objectively decreases their purchasing power and disrupts the economy by distorting interest rates. The parallel to the decreasing of neighbors’ property prices and disrupting their quality of life is obvious. Likewise, there are certain behaviors that can occur entirely within the confines of a physical property boundary that are still clear violations of the property norm. An example is someone standing on their own property pointing their own gun at a nearby neighboring property. Once again, it is not the behavior per se that determines violation. Obviously pointing a gun anywhere, including the sky, creates a potential trajectory in the direction of someone’s property; the determinant of violation, however, is proximity, impediments, and ballistic angle. Ballistic angle is especially illustrative here: Because property does not extend ad caelum, aiming at the sky over someone’s property rather than directly at his property is often actually the greater violation! Key takeaways from the preceding examples are these:

1. A behavior is only a violation in terms of its effect on others. However:
2. Behavior that occurs entirely within the confines of someone’s estate can still be a violation of others’.

Threats to property, intentional or not, are violations because they either force the property owner against his will to take action in responding to the threat, action that is necessarily not his most otherwise preferred course thereof. Even if he is not aware of the threat, the potential damage to his property or person is necessarily an infringement of his freedom to use and dispose of his property according his subjective valuations. Subjectivity is the reason for law; objectivity is law’s stabilizing framework. In the context of this discussion what is most important is that these aspects of law are complementary, not antagonistic.

In the case of certain behaviors having an adverse effect on neighbors’ property prices, the subjectivity involved in price formation is no obstacle to protecting prices from such behaviors. The market, which can only exist under the aforementioned conditions of legal complementarity between the subjective and the objective, is itself the economic mechanism by which subjective values are harmonized by objective prices. The reason why we punish vandalism is not just because it is done without permission and is extremely likely to offend the subjective aesthetic sensibilities of the property owner, but also because it lowers the price of his property. This occurs because the offended owner’s sensibilities are not randomly idiosyncratic but part of an objective norm: the desire for safety. Vandalism is proof unto itself that the neighborhood is unsafe for property and signals that a neighborhood may also be unsafe for persons. Prospective buyers do not have the luxury of long-term trial living to determine whether the latter is the case. As we have seen from above, however, crossing an estate boundary as in vandalism is not necessarily for a violation to occur. If a deviant behavior is sufficiently public, like performing one’s morning yoga routine naked on the front lawn, it will have a similar price effect as vandalism for similar reasons.

That violation of norms have adverse affects on property prices demands further analysis. A norm is the central tendency of a distribution of attitudes. The variance of this distribution is subjectivity. The concept of norm is meaningful only when the distribution is not only varying but also non-uniform. Uniformity would mean that no attitude is more common than any other. Obviously the distribution of attitudes toward something like unprovoked killing is extremely non-uniform. That unprovoked killers exist and have an opposing attitude toward such behavior, however, means that the distribution has variance, i.e. subjectivity. Either a distribution has variance or it does not. Because morality consists of existential attitudes and behaviors and because these vary, this by itself makes makes morality subjective. Most people, however, regard unprovoked killing as “objectively wrong”, or at least recognize that the degree of subjectivity around it as very low. If morality is either subjective or it is not, however, then strictly speaking degree of subjectivity cannot apply. How is it then, the both here and earlier in this article where we related law to morality, we used term “degree of subjectivity” without hopefully any confusion? It is because colloquially “subjectivity” is not used to refer to morality’s variance being non-zero, but to the fact that the magnitude of this variance itself varies greatly from issue to issue! For instance, it is an objective fact that abortion is an unprovoked killing of a distinct human life. For a great many, however, even on the right, this by itself does not justify abortion’s prohibition at all. What is significant here is that “it’s subjective” is by itself no basis whatsoever for determination of whether something is prohibited or not. And yet, “it’s subjective” is the most common objection other libertarians have to protection of property prices against violation of norms by neighbors. Opponents also may also claim that I am committing a false continuum fallacy: That because both unprovoked killing and being a bad neighbor are misbehaviors along a continuum whose degree of badness is a subjective judgment, they should both be legally prohibited. I am not, however, arguing for blanket prohibition of irresponsibility on the part of neighbors. I am arguing for protection of property prices by legal default, which is significantly different. Next we will see why.

“By legal default” means that behavior that is deviant in a way that materially lowers neighboring property prices is prohibited unless all affected neighbors give explicit permission. Otherwise, the only other way such behavior could be engaged in is in a location remote from neighbors. This is a clear differentiation of neighborly irresponsibility from homicide because the latter always has a victim regardless of where it occurs or how many people other than the victim give the killer permission. It should be noted however, that a significant though not primary motivation to punish homicide is homicide’s annihilation of the value of the victim’s human capital, which can be priced in terms of the present value of their expected lifetime income, so punishment of property value damage is far from entirely dissimilar. An actual dissimilarity is that property price damage is a civil, rather than criminal offense. The tort is a latecomer’s breach of duty to respect the value in his neighbor’s property as built up by homesteaders and maintained by their transferees. The protection point is the value at the time of latecomers’ arrival, not the high water mark of value however, because of course a homesteader could slack before latecomers arrive, which means that the price received from latecomers would be less than what it would have been had they arrived earlier. Tort law is a system of proven efficacy that is widely endorsed in libertarianism. Leading libertarian thinkers such as Rothbard have rigorously applied tort law to externalities such as air pollution¹. Local property price protection is the logical extension of such application. Although tort law is at the more technical end of the spectrum of libertarian praxis, this legal regime jives quite quite nicely with the casual intuition of “do want you want without harming others”. By allowing deviant behavior with neighbors’ consent, the principle of voluntarism is preserved. The subjectivity of harm is resolved through the market’s incorporation of all attitudes on the moral distribution (including deviants’ positive valuations!), producing an objective record of harm in the form of price decrease due to dominance of norms within the distribution.

Another objection is that irresponsibility can also be prohibited by covenant. The problem with this is that covenants are formal contracts, which takes time and incurs legal costs to properly prepare. Enforcement of such contracts is also more costly due to their idiosyncrasies. It takes but one holdout neighbor to collapse the proposed covenant due to the nature of neighborhood effects such as in the vandalism example given earlier. Prospective buyers may not know whether the vandal is a neighbor, but given that there is a significant likelihood that this is the case, they do not know which neighbor it is, thus depressing all neighboring property prices. A neighbors who is negligent enough to let their gardens or lawns become overgrown with weeds or naked yoga practitioners are less trustworthy in policing vandalism, less trustworthy in supervising others’ children playing, etc. When one neighbor is irresponsible, others often slack as well because their efforts in maintaining their property are not fully rewarded. Opponents may counter that shaming and ostracism can complement or substitute for covenants. The problem with this is that the type of people who commit public acts of depravity, the type most damaging to property prices, are also the type who are utterly insensitive to shaming². It is absurd that any normal person should ever need to go door to door asking his neighbors to sign a covenant prohibiting something like public bestiality. It is positively perverse that responsible people should ever have to do such a thing merely to maintain the sweat equity they put into maintaining a home. Covenants are for public matters of taste, not of public morality.

Home equity is no mere status symbol. For many it is foundational wealth. People take great pride in their stewardship of the homesteads that have been handed down through generations, and even greater pride in leaving their descendants either real estate or proceeds from the sale thereof. Your ability to control your own environment, to elevate its quality and comfort, and to spend your time as you wish is a direct function of wealth. A significant reason why we value liberty politically is because we value freedom personally, and there is little that is more freeing than wealth. Opponents may dismiss protection of wealth in home equity as “protectionism”. Protectionism, however, is a blanket prohibition or penalization of an economic activity that threatens the equity of firms that are unwilling or unable to compete fairly in creating value. Such firms are the ones who lobby for protection, although typically protection is applied to their whole industry. It creates a deadweight loss in the market. Property price protection, however, is localized to the radius of the economic neighborhood effects of certain behavior, which is typically a literal neighborhood. It is protection not of the lazy and incompetent, but of those who create or maintain value. While it is possible for an irresponsible and deviant property owner to profit from his behavior, the loss to his neighbors is almost invariably much greater. We cannot, however, like mainstream economists, treat the matter only with monetary cost-benefit analysis because that can justify massive infringements on liberty. When an aggregate dollar figure like GDP is maximized to the exclusion of all other considerations, this could justify a laissez-faire economy coupled with a mandate that everyone work eighty hours a week under penalty of death. It is important to point out here, however, that there is no mandate for latecomers to increase property prices under this model, merely to respect the price at the time of their arrival. The consideration in this case is far more fundamental than dollars and cents, however People are of course perfectly within their rights to depreciate their own property so long as no one else’s property is so affected. It is the fact that unilaterally depressing neighbors’ property prices is an objectively measurable and negative imposition on them and violates the principle of consent. The quantitative reduction in neighborhood equity is the direct result of the qualitative reduction in overall standard of living.

Property, the core of libertarianism, is itself a norm. The very concept of a norm is meaningless without subjectivity, which is is why it is absurd when statists try to argue against us based on the fact that not everyone respects the property norm. Subjectivity, however, is by itself is no basis for legal diffidence because certain behaviors based on subjective valuation have objective, measurable, material effects on the property of others. Such property is often the product of years of blood, sweat, and tears shed by our homesteading forbears, as well as by transferees whom they deemed worthy of holding title. The moral case for preservation of their legacy, for ourselves and for our posterity, is unimpeachable. This case is what makes the norm of preservation as predominant as the property norm itself. This predominance manifests in the depression of property prices by publicly deviant behavior. These price effects can be scientifically teased out from movements of the market as a whole, which creates a job opportunity for econometricians that is actually productive. Neighbortarianism is a legal system properly grounded in morality, yet one that deftly avoids fractious moralism through both its consent to deviance feature and its criterion of price materiality. Neighbortarianism is a resounding rebuttal to those who claim that libertarianism is a philosophy of anti-social atomism; it applies libertarian theory to issues of neighborhood effects in a way that efficiently promotes the flourishing of healthy families and communities. It pays due deference to the legacy of our homesteading forbears while providing the flexibility to accommodate changing tastes and fashions. It neatly resolves the issue that is most contentious among libertarians, immigration, by subsuming the ethical considerations diversity into the aesthetic ones. This thesis, while building on Rothbard’s externality theory and Hoppe’s discussion of covenants and the bad neighbor problem, is novel unto itself and not yet within the mainstream of libertarian thought. To those libertarians who are open-minded enough to grapple with this thesis honestly, as well as to other, similar political wonks out there, I ask, intellectually speaking, “won’t you be…my neighbor?”.

1 Cf. Murray Rothbard’s “Law, Property Rights, and Air Pollution”

2 Cf. Christopher Cantwell’s “The Limits of Ostracism”.