Tuesday, December 30, 2008

Adam Smith Influenced Post-1783 US Land Law reform

David Brin, ‘scientist and bestselling author’, writes the Contrary Brin Blog, HERE: and on 29 December he posted:

Truth & Reconciliation Addendum: How radical might it all get?”

“Time for a historical factoid. At around the time of the 1775 uprising that sparked the American Revolution, vast sections (up to half) of the colonies of Georgia, New York, Pennsylvania, and Maryland were owned by individual families under charters granted by the British crown. The great landlords were mostly royal cronies - personal friends of the king - who never even visited their vast new fiefs. (Such cronyism was cited by Adam Smith as the great destroyer of free markets, rather than socialism, which he considered a much less worrisme threat.)

How did that earlier generation of Founders solve the problem? Certainly seizure of some Tory assets had a great deal to do with the breakup of those grossly unfair, unearned estates -- and such things might happen again, if the People must rise up against a new feudalism. Still, mass confiscation is a bludgeon, at-best unreliable. Often, it only leads to a new class of meddling masters, even worse than those who came before.

Fortunately the main rebalancing technique that was used, just after the revolution was far gentler and less socialistic. Across the 1780s and 1790s, many states passed laws against “primogeniture"... the automatic inheritance of all real property and titles by the eldest son.

That was it. Simple. But it sufficed.

Recall that primogeniture had been a strong tradition, that let aristocratic wealth and power remain concentrated in a few families. Hence, for a generation, American society (through consensus political action) stepped in to severely limit a landowner's right to decide which of his children would receive what. Instead, for a while, the law demanded equal distribution among all offspring

David Brin’s ‘factoid’, er, isn’t.

Adam Smith wrote about the political economy of colonies in Wealth Of Nations (WN IV.vii.b), which David Brin may wish to read to correct the false impression that it was the genius of the first generation of the Revolution to have discovered the means by which the newly independent colonies altered the economic history of the new states. It was certainly their political savvy which made the difference between the former British colonies and their South American counterparts, and became increasingly obvious within a few generations.

The Revolution’s leaders and many of their luminaries, right across the political structure of the new state, became familiar with Wealth Of Nations, for many years imported from Britain before an American edition was published (the Library of the US Congress holds George Washington's signed copy).

In Wealth Of Nations, many American readers no doubt turned to Chapter vii of Book IV: ‘Of Colonies’, and Part 2: ‘Causes of Prosperity of new Colonies’, where he discusses the failings of the Spanish, Portuguese, and French administrations (and has a disquisition of the early Greek colonies of antiquity), within which they would find the following:

But there are no colonies of which the progress has been more rapid than that of the English in North America.

Plenty of good land, and liberty to manage their own affairs their own way, seem to be the two great causes of the prosperity of all new colonies.

In the plenty of good land the English colonies of North America, though no doubt very abundantly provided, are however inferior to those of the Spaniards and Portugueze, and not superior to some of those possessed by the French before the late war. But the political institutions of the English colonies have been more favourable to the improvement and cultivation of this land than those of any of the other three nations.

First, the engrossing of uncultivated land, though it has by no means been prevented altogether, has been more restrained in the English colonies than in any other. The colony law which imposes upon every proprietor the obligation of improving and cultivating, within a limited time, a certain proportion of his lands, and which in case of failure, declares those neglected lands grantable to any other person, though it has not, perhaps, been very strictly executed, has, however, had some effect.

Secondly, in Pennsylvania there is no right of primogeniture, and lands, like movables, are divided equally among all the children of the family. In three of the provinces of New England the oldest has only a double share, as in the Mosaical law. Though in those provinces, therefore, too great a quantity of land should sometimes be engrossed by a particular individual, it is likely, in the course of a generation or two, to be sufficiently divided again. In the other English colonies, indeed, the right of primogeniture takes place, as in the law of England. But in all the English colonies the tenure of the*39 lands, which are all held by free socage, facilitates alienation, and the grantee of any extensive tract of land generally finds it for his interest to alienate, as fast as he can, the greater part of it, reserving only a small quit-rent. In the Spanish and Portugueze colonies, what is called the right of Majorazzo takes place in the succession of all those great estates to which any title of honour is annexed. Such estates go all to one person, and are in effect entailed and unalienable. The French colonies, indeed, are subject to the custom of Paris, which, in the inheritance of land, is much more favourable to the younger children than the law of England. But in the French colonies, if any part of an estate, held by the noble tenure of chivalry and homage, is alienated, it is, for a limited time, subject to the right of redemption, either by the heir of the superior or by the heir of the family; and all the largest estates of the country are held by such noble tenures, which necessarily embarrass alienation. But in a new colony a great uncultivated estate is likely to be much more speedily divided by alienation than by succession. The plenty and cheapness of good land, it has already been observed, are the principal causes of the rapid prosperity of new colonies. The engrossing of land, in effect, destroys this plenty and cheapness. The engrossing of uncultivated land, besides, is the greatest obstruction to its improvement. But the labour that is employed in the improvement and cultivation of land affords the greatest and most valuable produce to the society. The produce of labour, in this case, pays not only its own wages, and the profit of the stock which employs it, but the rent of the land too upon which it is employed. The labour of the English colonists, therefore, being more employed in the improvement and cultivation of land, is likely to afford a greater and more valuable produce than that of any of the other three nations, which, by the engrossing of land, is more or less diverted towards other employments
.” [WN IV.ii.16-19: pp 572-73]

Primogeniture was a regular target of Adam Smith’s in his writings and lectures. Britain was dominated by the ancient law of primogeniture and it was pernicious for all the reasons stated by David Brin.

However, typically, the law of primogeniture was made even more onerous by the legal device known as ‘entail’, which locked the entire estate into a non-divisible whole: no part could be inherited or sold separately; the whole estate could only be purchased subject to the entail applying in perpetuity.

The entail device was even more pernicious.

An inheritor, for example, finding himself (it was always male, of course) in need of funds to invest and improve his landed estate, assuming he was so inclined, or course, or he just wanted the money his prodigal life-style, could not dispose of parts of the estate; he had to sell, or pledge, the whole estate. This system prevented the development of a yeoman class of farmers on the one hand, and ensured the steady decline of landed estates inherited by persons uninterested in agricultural improvement.

No Revolutionary politician was unaware of the problems caused by primogeniture and entails. That some states had legislated before 1776 under British administration to reform primogeniture and entail laws was an excellent example to the rest post-independence. Adam Smith provided the political economy of the benefits of these moves.

I think David Brin, and others (many of them in the US media who seem to believe that history began only after 1783), should at least acknowledge that British thinking from the likes of Adam Smith, played a not insignificant role in the deliberations of the post-Revolution leaders and those who influenced them.

David also seems in his post (follow the link) to think that Adam Smith was aware of ‘socialism’ as an alternative to private ownership. He wasn’t. That was an issue in the 19th century, not the 18th.

The alternative to the commercial societies of the 18th century, guided by mercantile political economy and that it entailed, was Adam Smith’s version of commercial society, as outlined in Wealth Of Nations, absent monopolies, protectionism, jealousies of trade, special interests and their client legislators and those who influenced them, colonies, and wars for the trivial ends of princes and their governments. Smith had no views of ‘socialism’; it was not agenda in his day.

Whether he would have been a member of the Democratic Party is pure conjecture – about as relevant as whether he would have supported the New York Giants, or Manchester United…

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Blogger michael webster said...

This was interesting for me, since I was unaware of this legal debate.

But primogeniture must have had some rational basis.

Do you know when it started?

As for David Brin, I thought he too had made an interesting point when he said:

"But we need to prepare against the very real possibility that we’re re-entering a more “normal” period of history. One riven by steep cliffs of disparity of and inherited privilege -- tendencies that appear to be rooted in human nature and our genes. The very same trends that ruined free markets and democracy in hundreds of other nations and eras. Precisely the trends that the Enlightenment was invented to resist."

It is probably useful to note that the prosperity of the English economies grew in part because of an anti-libertarian stance: that is was right for the collective to trump the individual's right to transfer land unfettered upon his death.

3:12 pm  
Blogger Gavin Kennedy said...


The subject is discussed in Adam Smith's Lectures on Jurisprudence ('1766' Report) pp 464-6; pp524-5; &c.

It came into effect as the allodial system became feudal, and was clsoely associated with the inheritance of King's - everything went to the oldest male son, there being only one king at a time, if there was to be 'peace'.

Multiple claimants to the throne led to dangerous times and when claimants' titles were vague - or when they passed to the female line (Queen Mary v Queen Elizabeth) - the country could be beset with strife for a generation.

Primogeniture iamong the lesser Lords, etc., also 'solved' the problem of ambiguity of: 'who inherited what?'

When entail laws became the vogue, the primogeniture system really went ultra-negative in its effects on subsistence provision, and prevented the rapid emergence of productive small farmers (as per the British ex-colonies in North America).

9:35 pm  

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