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Part Two
Property, Profit, and Justice
Part Two of the text consists of an Introduction followed by Chapter 4 –- Traditional Theories of
Property and Profit; Chapter 5 –– Contemporary Challenges to Property Rights; Chapter 6 –- Justice.
The Introduction here gives a good overview of what you are about to present. The issues that are
introduced here include two economic issues: the importance of the profit motive, and whether
restrictions should be placed on private ownership of property as well as a third issue taken to be
combining both ethics and economics, the nature of justice.
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Chapter 4 — Traditional Theories of Property and Profit (pp. 151-176)
Chapter 4 starts with two case studies (pp. 151 – 157). The first of these case studies involves
thalidomide, or more specifically, the rediscovery and marketing of thalidomide as a drug to fight
cancer, and the way in which its pricing structure changed once it became a cancer drug. The second
case study involves a company called Plasma International, which supplies blood plasma around the
world. However, it also collects blood plasma around the world. It purchases plasma from the poor for
as little as $.90 a pint, processes it, and resells it for as much as $150 a pint.
Article: “The Justification of Private Property” by John Locke (pp. 158 – 162)
The English philosopher John Locke is one of the first philosophers to speak of private property. His
theory of private property, although groundbreaking, can be discussed in quite simple terms.
First of all, he believes that private property should exist, and can be justified. In that regard we
probably agree.
He believes that initially, everything in the world belonged to mankind in common. The exception to
this, of course, is the person. Each person, and therefore the labor of each person, belongs only to that
person. We are free to do with our labor as we please. We may sell it or otherwise use it to our
advantage.
In the initial state of nature, things become private property by the mixing of labor with something
that once belonged to all mankind in common. For example, if a person were to hunt down a deer, the
meat of the deer now belongs only to that person, not to mankind in common. The same thing, for
example, if I clear land for farming and build myself a hut.
The laws given by a common government can, of course, change what is available for the individual
to appropriate. But nonetheless, private property can be justified and does exist.
Locke further points out that once people have property of their own they can and will trade it to
others. For example, the hunter may well trade some meat for some clothing. It is barter, Locke
believes, that led to the use of money or currency. It is easier to conduct commerce with this
unspoilable means of exchange than by carrying around and bartering actual goods.
Article: “Benefits of the Profit Motive” by Adam Smith (pp. 163-167)
Adam Smith, himself a professor of philosophy, gives us these minal treatise on free enterprise. It is
his famous work, The Wealth of Nations, and this article is excerpted from that work.
Here Smith points out for us the concept of “division of labor.” That is, if we all specialize in one
aspect of production, we will be able to create more than if we each try to create the whole item. In
our modern society, this is certainly true with almost everything we use. No one would think about
going to the corner mechanic and asking them to build a car for them, although the person probably
could. It may take the single person several months to construct the car, and even then we may doubt
that they knew exactly what they were doing at each juncture, although we may believe they are very
skilled at certain aspects of automotive technology. The example Smith gives is less technologically
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advanced, but equally apparent upon explanation. He gives the example of making pins in 18th
century England. Pin-making consists of about 18 distinct operations. If a person unfamiliar with the
manufacture of pins tries to make a pin, it may take him or her an entire day. If ten people get
together, learn the equipment (proper tools or proper machinery), and split up the tasks, ten people
can make 48,000 pins in one day. This equates to 4,800 pins each in one day. Thus, I will never waste
my time trying to make a pin. I will always buy one, and I will buy one from the factory where the
work is divided for maximum production, because the costs associated with the pin will then be the
lowest.
Smith points out that this fits well with the social nature of man and by treaty, by barter, and by sale
or purchase, we each can trade our specialized labor (non-specialized labor is worth much less) with
one another for maximum gain.
Article: “Alienated Labour” by Karl Marx (pp. 167 – 171)
If Locke and Smith are seen as optimists with regard to private property and the benefits of free
exchange for human society, then certainly one can look at Karl Marx as a pessimist in the same area.
Marx states, “The worker becomes poorer the more wealth he produces.” In his view of labor as a
Article: “Wealth” by Andrew Carnegie (pp. 172 – 176)
Andrew Carnegie was, at one time believed, to be the world’s richest man. He was also a great
philanthropist, donating huge sums of money for libraries and education, among other good works.
He believed in the sacredness of private property – that it was the foundation upon which modern
civilization itself rested. He also believed that people had an obligation to use their surplus wealth to
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Teaching Hint: This chapter distinguishes itself from the other chapters in the book by presenting
four reviews by thinkers who remain famous today of their contemporary society and of incipient
capitalism.
Discussion Questions
1. You have gone on a wilderness hike with a group of people you do not know well. The group
gets lost and you have the last bottle of water. Someone offers you $50 for it, another, person
offers $100, and yet another $500. At heart, you believe it should be split among everyone, but
that way each person will get less than a half ounce of water, and you will not get any money.
What do you do? Does your action change any if you are sure park rangers will find your
group? Does your answer change any if you are sure your group will not be found and must
fend for itself?
2. You take your car to a modern oil change franchise. You are amazed at how quickly the oil
change is performed. Why can’t you do it as quickly yourself?
3. You buy a product on the Internet. Shortly thereafter, you begin receiving unsolicited e-mails
about special offers on related products from other companies. Has someone done something
unethical?
Resources for further study — Film, Literature, and the Web:
The Stanford Encyclopedia of Philosophy. “John Locke.” May 5, 2007.
http://plato.stanford.edu/entries/locke/ (May 25, 2007)
Charlie and the Chocolate Factory. Dir. Tim Burton, Perfs. Johnny Depp, Freddie Highmore, David
Kelly, Helena Bonham Carter, Deep Roy. Film. Warner Bros., 1995.
Michigan State University, “From Adam Smith to Karl Marx.” E-Book by Dan Sweeney.
http://www.msu.edu/~sweene27/EbookAdamSmithtoKarlMarx_files/frame.htm (July 23, 2007)
PBS, Teacher’s Guide for “Andrew Carnegie, the Richest Man in the World”
http://www.pbs.org/wgbh/amex/carnegie/tguide/index.html (June 1, 2007)