A great literature has grown up witnessing the struggle of the big city immigrant.  Perhaps the greatest were Henry Mayhew’s London Labour and the London Poor and Jacob Riis’s How the Other Half Lives.  Mayhew demonstrated what life was like in London in 1850 for those without particular skill, those immigrating into London from the English countryside or the Irish potato famine.  They lived, many of them, as costermongers on the street selling apples, or coffee, or flowers.  They had no religion, they had vague recollections of their parents, they were mostly illiterate, and they did not contract legal marriages.  They expected to fight with their fists, and knew the law only as it descended upon them for violating the ordinances regulating street commerce.  Writing later in the century, Riis could show his readers a New York City with teeming tenements that seemed to show mid-century London as a mild picnic. From the Irish to the Italians to Chinatown to Jewtown, he told a grim story of dirt, dark, overcrowding, exploitation, and poverty.  For he described a people still attached to their peasant culture, unskilled, undisciplined, wretched, camped out in the city.

But even the poor benefit from law, and even the poor are capable of self-government.  Hernando de Soto is a Peruvian businessman who founded the Institute for Liberty and Democracy in Lima to try to help dig his country out of its history of poverty.  In numerous books and articles he has advanced the thesis that the poverty in Latin America issues from the lack of access to law and property rights.  When a householder does not hold clear title to the land on which he builds a house, he cannot obtain a mortgage to finance his building.  He can only build when he has the cash to build.  And without clear title, he must build out to the lot lines with a huge defensive wall.  He cannot afford to leave his land; for he has no legal title, and no legal call on the state to protect his ownership rights.  When the farmer does not hold a clear title to the land on which he farms, he cannot obtain financing for his crops and for his farm buildings.  He must finance his operations from his own savings, or from family and friends, or perhaps from a government co-operative.

We should not think that the poor in their villages strewn across South American and Asia are in this position because they are incapable of understanding the concept of property or of managing property rights and title to land.  When de Soto traveled to villages in South America he found that everyone knew who owned what.  The problem was, as he wrote in The Mystery of Capital, that the system of land ownership in the villages was operated according to a verbal and aural system, a common memory of land ownership, while the official land title scheme in the capital city was a paper system run by the political elite that was expensive to use and radically out of synchronization with the land ownership reality out in the villages.  The statute law of the political elite was radically different from the living law in the villages.

Why then, de Soto asked, did the United States seem to have a system of land ownership that worked, where the system in his own Peru had broken down into a war between country and city?  The answer was instructive.  The peaceable system of land ownership that the United States presently enjoyed was not something imported from Europe or hammered out during the American Revolution.  In fact there had been a war in the United States between the farmers and the federal and state governments that had festered away for decades.  It only ended when the federal government capitulated during the Civil War.

In early colonial days the government had brought over the British system of land ownership that assumed that all land already had a title.  But the land of North America, from the perspective of the colonizing Europeans, did not have an owner.  A living law grew up which allowed a man to own land that he had settled and improved.  The big landowners in the government strenuously resisted this custom, both for selfish reasons, and to attempt to enforce the treaties that had been made with Indian tribes.  But it was all for naught.  First of all, the squatters and settlers could vote, and they voted for politicians that would support their rights.  “At the beginning of the nineteenth century, the property system of the United States was in disarray.”  The government had failed to deal with the problem of migration on the land. (De Soto 2000 p127, 129)  In response, the settlers organized their own self-governing claim associations and made their own laws, specifying the “procedure for registering, marking, and transferring claims; and the procedure to be adopted when club members contested each other’s rights.”  In the end, the federal government capitulated in the Homestead Act of 1862, which was not a noble grant of land to the tiller but a codification of the existing living law of the settlers out on the plains.

The Homestead Act was not the only capitulation by the suits to the living law of the people.  When gold was discovered at Sutter’s Mill, the Forty Niners rushed out to California in 1849 to mine it only to find that the United States did not possess a mineral law.  In any case, in the new State of California, recently acquired from Mexico as the spoils of war, property rights in general were in considerable flux.  But the miners were not deterred.  They set to work and wrote their own property and mineral rights law, setting up their own mining districts and regulations to govern the creation and transfer of mineral rights.  Typically mining district regulations evolved through nine distinct stages from the formation of the district at a mass meeting of miners to the establishment of a “system for resolving disputes.”(De Soto 2000 p140-3)  The U.S. Congress got around to establishing a federal mineral law about 20 years later.  It was based on the living law that had been worked out by the miners in their self-governing mineral districts.

The success that the American farmers and miners of the nineteenth century achieved in enforcing their claims upon an elite that was hostile to their claims is instructive, especially when compared with the failures of the Peruvians.  These American citizens already possessed the tools of modern self-government.  Set down upon a hostile plain, or in remote mountains, they immediately organized self-governing institutions complete with president, recording secretary, by-laws, and a paper trail.  This was not a pre-industrial village culture that a metropolitan elite could marginalize as backward and superstitious.The American farmers and miners generated a record of self-governing competence that the suits back in Washington D.C. could not ignore.

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©2005 Christopher Chantrill