David Boyle

Why property is not theft after all: the strange rebirth of Liberal ownership policy

Liberator, December 2004

Nearly 80 years ago, a group of inexperienced political campaigners – outraged at the monopolistic behaviour of the London General bus company – took the unprecedented step of launching their own pirate bus service.

They leased a series of ancient omnibuses, painted them in rainbow colours and called them ‘Morris’, ‘Ruskin’ and names with similar radical echoes – and took on the giant bus company on its most lucrative routes.

The campaign failed.  London General swept all before it, including the small bus operators the campaigners were defending, only of course to be nationalised under the auspices of the London Passenger Transport Board.

Their views on this latter nationalisation are unrecorded, but they would not have approved.  For the Distributists – for that is the slightly unworldly group of campaigners I refer to – giant state-run enterprise was indistinguishable from giant corporate enterprise.  The problem was one of size and ultimate power.

Distributism is almost forgotten as a political creed now.  Its leaders, Hilaire Belloc and G. K. Chesterton, both dusty figures from a bygone age, their greatest works unread and their reputations – like many political figures of the 1920s and 30s, right and left – a little tarnished by a note of anti-semitism (though in their defence, it has to be said that they were among the first to warn of the true meaning of Hitler).

But there are some signs of a revival of interest, especially now that corporate power and the size of institutions – thanks primarily Naomi Klein – are back at the forefront of the wider political agenda.

Distributism dated back primarily to Belloc’s 1912 book The Servile State, written just after the end of his period as a Liberal MP, which set out the basic premise: that free market corporatism and socialism both ended in much the same place – centralisation and a kind of slavery.

He and Chesterton argued for solutions based on small-scale ownership – the very opposite of Fabian socialism at the time – as the only guarantee of freedom against the corporate giants.  If you owned your home, a vegetable patch, maybe a small business, you could never be cajoled in quite the way that you could if you were simply at the beck and call of Big Manager or Big Bureaucrat.

Quite how this distribution would be achieved was never quiet spelled out.  A combination of land reform and anti-trust legislation was set out in no detail whatever in Chesterton’s 1926 Distributist ‘manifesto’, The Outline of Sanity.

Why might this still be of interest to Liberal Democrats?  One reason is that the founders and many of the foot soldiers of the movement were former Liberals, and many of the themes were echoes of Liberal-style decentralisation.

But there is a more fundamental reason of philosophy.  Belloc’s writings were, for many Liberals between the wars, a vital intellectual bastion against the Fabianism they regarded as so authoritarian – Beatrice and Sidney Webb were by then fervent admirers of Stalin and all his works.

It was one reason why, once the Liberal Party leapt into its post-war period of policy-making and renewal that culminated in the revival of the Grimond Years, issues of ownership and how to spread it more widely were near the top of their agenda.

The chair of the party’s commission on ownership in 1953 was the former private secretary to Herbert Samuel, Elliott Dodds.  In the final report, he even paid this fulsome tribute to the Distributists:  “Tribute must be paid to the work of Hilaire Belloc and G. K. Chesterton who, though they fell foul of the Liberal Party, were such doughty fighters for Liberal values, and whose ‘distributist’ crusade inspired so many (including the present writer) with the ideal of ownership for all.”

There was by then something of a rapprochement between the two philosophies, chaired by Dodds, when Liberal Party officials met the remaining dignitaries of Distributism at a meeting in Covent Garden.  But there were no moves to heal the rift entirely: both Belloc and Chesterton were dead and Distibutism seemed part of another age.

The policy the party outlined, under Dodd’s chairmanship both in 1938 and 1953 was a mixture of land tax and profit-sharing, and measures to tackle monopoly and inherited wealth.

By the time Liberator first appeared in 1970, ownership was still high on the party’s agenda, but not so much how to spread ownership through society, but how to give people an ownership stake at their workplace.

Grimond had a personal fascination for industrial common ownership.  Profit-sharing, co-ownership, co-operatives were high on the party’s list of ideals under his years of inspiration.  It was industrial democracy – a stake at your workplace and the spread of co-operatives – that the party campaigned on through the 1970s.

During the Lib-Lab Pact years of 1977-8, it was the legislation that paved the way for employee share ownership and the Industrial Common Ownership Fund ICOF – so critical in the development of social enterprises, and other new kinds of common ownership – that stands out as one of the few permanent achievements.

But this was ‘common ownership’, and important as this was as a new development of new kinds of property stakeholding stakes, it was not quite the original Distributist ideal.

It was left to the Thatcher government to wrong-foot Liberals by introducing one of the clearest examples of Distributist legislation in a century: selling council houses at to their tenants at a heavy discount.

Conservative Party ideologues did not understand the limits to right to buy, extending it to the point where public housing became almost impossible.  But this was still an elegantly radical Liberal solution, liberating tenants from the patronising and incompetent rule of Labour’s big city bosses.

Since then, the ghost of Thatcherism has become so powerful that Liberal Democrats have been nervous about revisiting the agenda of giantism and ownership.

This has had costs.  E. F. Schumacher’s 1973 classic Small is Beautiful was one of the main inspirations behind the disappearance of another faction of the Liberal Party to form the Ecology Party, now the Greens.

When in 1992, I drew the attention of a senior party figure to the extraordinary parallels between the constituencies with Liberal Democrat MPs and constituencies with the highest rates of self-employment in the UK – there was and is a bizarrely close comparison – he was less than staggered.

“You want to be a little careful not to sound too Poujardist,” he said, a reference to half-forgotten uprising of small shopkeepers.

I believe he was wrong, and that there is a significant psychological link between self-employment, a sense of independence and voting Liberal Democrat. 

But apart from the studious efforts of Weston-super-Mare MP Brian Cotter with the small business portfolio in recent years, this link has been left unexploited.

You can dismiss the Distributists as dreamers kicking against the inevitable changes of the modern world – though this is harder now the great corporate philosophies of the 20th century have been defeated – but I believe it is time we exhumed some of the themes they made their own.

I do so for three reasons:

  1. Giantism is the dog in British politics that doesn’t bark: it is critically significant to people’s lives, now that they are increasingly the subject of factory schools and hospitals managed by means of targets from Whitehall – giant machines for the throughput of patients where you never see the same doctor twice, giant manufacturies for youth where the size of classes matters but the size of schools apparently doesn’t.

2. The Liberal Democrat emphasis on decentralisation is insufficient unless it broadens to find other ways of giving people more independence in their lives.  There is no point in giving them an unlimited say on local committees, if the real power over them is economic, controlled by boardrooms on another continent.  Giantism in economics is anti-competitive and limits choice, and has already all but ruined British agriculture thanks to the retail monopolists

3. There is a deep-seated sense in British society that genuine self-determination is only possible by owning your own home.  That far the Thatcherites were undoubtedly correct.  The irony is that the means they organised to achieve it has created terrifying house price inflation – the average UK house costs 20 times what it did when Liberator was first published.  As a result, both partners are forced into a soul-destroying dependence on earnings, at great cost to family life and well-being. This kind of indentured semi-servitude to which we willingly sell ourselves is precisely the kind of nightmare Belloc warned about.

The answers may not be obvious, but the questions are becoming ever clearer.

How can we spread ownership – both in the traditional way and through new forms of ownership like limited liability partnerships and community land trusts – when wealth is increasingly concentrated: the world’s 200 richest people now own as much wealth as the combined annual incomes of the poorest 2.5 billion people?

How can we go beyond the decentralisation of decision-making – which by itself is simply the generous distribution of bureaucracy – so that people really believe they have a stake and a genuine sense of ownership about the public services they use?

How can we prevent the increasing power of monopolistic semi-cartels, while still encouraging UK business to be competitive in the world market?

Those are the questions. The answers are going to include new forms of taxation, new kinds of personal financial stakes in assets like North Sea Oil.

They are going to include the break-up of the factory institutions, forcing consultants and specialist teachers to organise more peripatetic schedules.

They are undoubtedly going to include new kinds of anti-trust legislation, and an extension of the legal concept of monopoly so that it prevents retailers – for example – having an effective stranglehold over a local or regional economy.

But above all it is going to spread a genuine stake in institutions and more than a stake – a place to own – down through society.  That is self-determination and Liberalism radical enough for Liberator to be proud of.

In the meantime we have to defend those signs of independence and self-determination against the advocates of giantism, both public and private corporatism, rather as Chesterton did all that time ago.

“Do anything, however small,” urged Chesterton in 1926.  “Save one out of a hundred shops.  Save one croft out of a hundred crofts.  Keep one door open out of a hundred doors; for so long as one door is open, we are not in prison.”


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title: books by David Boyle
Broke Voyages of Discovery Money Matters Blondel's Song Leaves World to Darkness The Little Money Book Funny Money The Tyranny of Numbers