Écrivons notre propre Constitution Européenne

1 link property

In his essay "Socialism has failed. Now capitalism is bankrupt. So what comes next ?" in The Guardian, Eric Hobsbawm questions what sort of economic model, structure, ideal, utopia, you-name-it... can/will emerge from the current collapse of international capitalism. I pretend here to propose a new paradigm, that I've not seen before.

Some claim "true communism" hasn't been tested and should be given another chance. Others claim that the current model is not "really capitalism" either and should not be ruled out completely. Both claims are defeated by history: this form of capitalism has been around for centuries, and all forms of communism have lead to the same centrally planed political structure. So I don't see any reason to give them another try, at least not before some other economical models have been tested.

And here I'll propose another economical model, one that has not been tested ever before, and that hasn't even been proposed as far as I'm aware of it, at least not in recent history. To understand this model, we need to look at the 2 models that have been discredited in the XX-th century: capitalism and communism.

Communism

The point of communism is that productive tools can not be held in private hands, and must belong to all, they must be "common property" (hence the name "communism"). This leads rather directly that people who work hard get the same reward as the lazy ones, and there is no incentive in being creative, pro-active. People work for glory, but glory gets you only so much in life. In such a system, productive workers tend to get less reward than the sly ones, those who participate in meetings and spend lots of time learning the inner workings of the system to get the most of it. They are then known as "apparatchiks", as people belonging to the apparel and manoeuvring the apparel, benefiting from the system and leading it such a way that they can continue to benefit from it. Productive tools might belong to every-body - or nobody - but they benefit to a small oligarchy. "We pretend to work and they pretend to pay us" became the motto in the former eastern European countries. Such a system needs heavy propaganda to keep functioning.

Capitalism

The point of capitalism is the exact opposite: every-thing can be privately owned, and private property is "good". Even public goods and services - like drinking water or waste disposal or money-creation - can be privately owned, which will lead to future historians looking back at our times in disbelief. Even ideas and can be privately owned ! And, of course, production tools can be privately owned. These production tools are better known as "companies", and not some sort of industrial machines as Marx had probably thought about them. Such a company is refered to as a "moral person" in opposition to a "physical person". A "physical person" is a human being, where a "moral person" is a legal construct where several persons put their efforts in common, and is not "moral" in any way.

And here comes the important part: under our rules, in the "western world" or wherever, a "moral person" has the exact same rights as a "physical person" : "Companies or firms formed in accordance with the law of a Member State and having their registered office, central administration or principal place of business within the Union shall, for the purposes of this Chapter, be treated in the same way as natural persons who are nationals of Member States." is said in Chapter 54, page 90 of the Lisbon Treaty.

Which means that a "moral" person can own (parts of) another "moral" person, which can own (parts of) another "moral" person, and so on, in a cascading property chain where the true proprietor of something is not known any-more. Thus, such private constructs don't belong to "people" any-more but to the "system", and lead to the exact same consequences as with "communism" : productive workers are demotivated, those closer to the source of the money get most of the reward. It forms a class of "apparatchiks" that don't produce anything any-more but participate in meetings and drink champagne. Decisions in a car manufacturing company are not taken by top engineers or race-car drivers, but MBA-holding marketing managers. This virtualisation of private property and it's insane results is brilliantly proven by the sub-prime mortgages and CDS/CDO mess, where the banks themselves don't know what they own and what it's worth (they're banks, aren't they ? Imagine an architect saying: "I've designed this high building but I have no clue how many people it can hold inside without collapsing. Give me more money so I can find out."). Such a system needs heavy marketing to keep people buying "stuff" they don't really need.

A new property rule

So, let\'s see, if unlimited private property and no private property of production tools - companies - both lead to an impasse, isn\'t there an obvious food for thought ? How about "some limited" rights to private property of companies ? And where to set a limit ? This limit needs to be both simple to spell and yet effective in tackling the shortcomings of communism and capitalism.

And here it goes : what if we agreed that privately held companies are possible, but can be held ONLY by physical persons ? Physical persons - as in "we, the people" - can put their combined efforts into a common structure and take privately the profits they can milk, but such a structure can not form, invest or otherwise associate in another common structure. The chain of property is limited to exactly 1 link.

Let's examine to what consequences it would take us:

  • for state-owned companies and state-employed people, there would be no change
  • for self-employed people there would be no change
  • for small to medium-sized companies, where the property link is already limited to 1, there would be no change
  • for big corporations and holdings with lots of subsidiaries, they would not be able any-more to evade taxes by making huge profits in the holding appropriately situated in a tax haven, while making losses in every daughter company unfortunately situated in countries with good and expensive public services.
  • for investment firms and banks, it would mean a huge backlash. Investment would be direct, from money-holder to company-creator. A person with surplus financial capacity could still invest in a company, but under his own knowledge. He might hand off his spare money to a bloke that would try to find a good investment opportunity, but investing or not would still be his personal decision.

In such a system, private profit for creative or ambitious or hard-working people would be possible, investing in hazardous new ideas and reaping the profits would still be possible, but tax-havens would be made inoffensive and hiding one\'s personal responsibility behind smokescreens of cascading properties would not be possible any-more.

Behind the pragmatic and technical reasons to limit the chain of property to exactly 1 link is also a more philosophical reason: the right to something comes with the responsibility over this thing. So the right to private property shall be accompanied with the responsibility over this property, therefore the owner of a private property needs to be identifiable.