On ownership

16/06/2011 § 2 Comments

“Exactly. That’s what’s been happening here for the past ten thousand years: You’ve been doing what you damn well please with the world. And of course you mean to go right on doing what you damn well please with it, because the whole damn thing belongs to you.” Daniel Quinn

Years ago Dasha and I moved into a rented flat in London. It was tiny, with just one bedroom, but had a gorgeous mature garden 100 foot long.  I looked forward to working in it, cultivating the soil and planting things, weeding, pruning the shrubs, sowing annuals. Yet as it turned out, I didn’t do any of these things.  The grass grew long, the shrubs grew untamed, along with the weeds.  I enjoyed spending time in the garden but wasn’t motivated to improve it.

After a year we moved into a small house that we had bought, which also had a garden.  This time I had no motivational problems – over the next few years we transformed that garden from a patch of unkempt grass, overgrown laurel trees and old patio to a beautiful, fertile, colourful haven.

The main difference between these two situations is the sense of ownership I felt in the house.  In the flat, I knew we were only there temporarily and felt that if I put work in, I wouldn’t get it back. I also knew that I couldn’t make all the changes I would like – it belonged to someone else and they might not approve. In the house, by contrast, I had freedom to do what I wanted (subject to negotiation with Dasha), the knowledge that I would be there for a decent period of time and so could see the results of my efforts over time, and the incentive that a beautiful garden would create value. We would get pleasure from spending time in it and it would increase the value of the property when we came to sell. And so it proved.

For those of us interested in having a healthy relationship with Mother Earth, this sense of ownership is something we want to cultivate.  The pillaging of our Earth’s resources and the degradation of our ecosystems would surely cease if we remembered that this is our home for the long term.

Yet much of what is commonly termed “ownership” in our society is simply a license to exploit, carrying rights but precious few responsibilities. This is most extreme in the case of shareholder ownership, which carries power but no legal responsibility. What sort of ownership is that? Our laws are there, it seems, primarily to protect the powerful from any sort of accountability.  If we are lucky, an enlightened “owner” will care for what he or she owns. If we are not, the law sits idly by.

We need a far more mature version of ownership – ownership based on love and freedom, not on fear and control.

Funnily enough, we can see a model, of a sort, in the development of the role of the Queen over the years in property law. In strict legal theory the Queen (or to be precise the Crown, which in effect means the state) owns all the land in the UK.  We simply have a temporary license to occupy it with her permission. In feudal times this gave the king or queen huge power. Over the years however, as a result of a series of freedom struggles not so different from what has been going on in north Africa this year, we have been liberated. We now hold our land free from interference from the Crown (“freehold”) and this is backed up by the law. Of course the Queen is still there, but her role is now largely symbolic.

Is this the future of shareholder ownership? At the moment shareholders retain ownership of their capital and “lease” it to the board and staff to make profit from. The shareholders then sit at a distance and collect the surplus profits. They can fire the board if there is insufficient surplus.  This places considerable pressure on the board to maximize profit above anything else – after all, for many people the first thing on their list of things to do each morning is “Keep my job”, which means keep the shareholders happy.  Hence we get this remorseless drive towards growth at almost any cost.  We would get very different, more responsible, behaviour if shareholders power were diluted, allowing a universal suffrage where a cross-section of society appoint the directors.

As I write all this down it sounds terribly sensible (to me at least!). Yet to question the nature of ownership in our society is a revolutionary act. It is to risk being called a communist or worse.

Yet as I have tried to show, I strongly believe in ownership and the positive behaviours that can accompany it – responsibility, caring, taking a long-term approach. It is just that they’re not generally associated with shareholder ownership, and certainly not on the stock market, where remote speculators exchange shares like playthings.

I don’t mean to tar all shareholders or businesses with the same brush. There are business people who act like long-term owners. But far too many are acting like temporary tenants – once this piece of land has been exploited, they’ll move on. Only there is nowhere else to move to. Whoops….

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§ 2 Responses to On ownership

  • Finn Jackson says:

    I hold at least two apparently conflicting beliefs on this one. I will state them, and then see if I can reconcile them.

    One belief is that if people own something they will care for it — as in your garden example, and in the example often trotted out of grouse moors where wildlife is conserved because the moor is owned (and managed for a profit).

    The opposite is said to be the ‘tragedy of the commons’ where because something is not ‘owned’ by one person it is used by everyone, the resource is depleted, and so destroyed.

    But the counter example I saw recently was quoted by Charles Eisenstein: imagine you own a forest, which you can either clear-cut today for $100m or manage sustainably for $1m/year. Financial logic ‘forces’ you to clear-cut today and invest the $100m something else. Eisenstein’s point was that we are in effect in the process of clear-cutting the entire world, driven by this financial logic (invented by us).

    But is it ownership that creates this problem? I don’t think so.

    I can see two ways to reconcile these apparent opposites.

    One is that what will ‘inevitably’ happen is that we will clear-cut the world until we have turn the relative diversity of a forest into the relative monoculture of the grouse moor. At that point the returns from clear-cutting fall to near zero and it makes financial sense to manage the land sustainably. (I believe this is historically what happened in Scotland.) We have converted the natural asset of the forest (or whatever) into financial ‘wealth’.

    But the other outcome from this scenario was played out on Easter Island. It was clear-cut. The people who carved the statues either starved to death (most likely) or paddled away in their canoes.

    But still I don’t think ownership was they issue.

    The American Indians thought ownership of the land a ridiculous idea, but they did not suffer from the tragedy of the commons.
    It was only after the coming of the Europeans and the concept of Ownership that the buffalo were destroyed.

    To me what makes the difference is not the legal “fact” of ownership or non-ownership but an attitude of mind, .

    Or to use your words, it is not so much the “sense of ownership” an owner has about an asset, but what they choose do with it.
    It is less about their outer “ownership”, more about their inner sense of whether will they measure their own lives and their self-worth by how much they take (as our society teaches us), or by how much they can give.

    Thanks for providing me a space where I can work this out.

  • Finn Jackson says:

    Not wishing to monopolise your comment space, but I think the “give/take” axis I identified yesterday may be a bit too glib — too simplistic.

    I think at a deeper level it is to do with a sense of connection — of feeling separate and individual, or feeling connected and part of something bigger.

    ‘Ownership’ can bring us that sense of connection. But it is not essential. And in itself it is not sufficient.

    Counter arguments much welcomed. :o)

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