We have to imagine that under economic property regime (property regime not based upon mechanisms of power and coercion) every single member of society is voting on price of every particular commodity even if he is not buying it or even if he does not know about its existence. If a person is not buying particular commodity he also votes by saying that either “the price of this particular commodity is too high and as such it does not have for me any value” or “I do not need this commodity generally, even for free”. He may alternatively apply for some other price with another trader who might evaluate a price of the same commodity lower. People’s voting on the price of particular commodity actually estimates an economic contribution of this commodity's proprietor. Everyone is in the same position being buyer in certain transactions and being seller in the others. More than that, we are not only evaluating value of particular commodity in terms of our property, but are also evaluating our property in terms of this particular commodity.

But what happens if the mechanisms of power and coercion are entering a scene. What if somebody acquires certain exclusive rights based upon mechanisms of power and coercion at societal level, which allow him to mark a price of his commodity without incurring in common economic voting. Societal significance of this act is rather profound. Such situation, first of all, will not allow people to evaluate the real economic contribution of this particular individual since their votes do not matter as long as there is no any pressure upon his price decision (nowhere else to go for alternative price). On the other hand, what is more important – people equally cannot participate in evaluation of their own property (of their goods and services) in terms of this particular proprietor's property. They are denied such possibility by a refusal of their economic voting rights. Major reason why particular proprietor will go into trouble of getting exclusive property rights, which are usually very costly and require solid initial investments of various forms, is solely connected with an opportunity to appropriate exclusive income. If he is able to mark his price independently from people’s demands or independently from people generally this, first of all, will give the proprietor additional financial resources, since naturally he will not utilize such possibility leaving the price as it is or moreover diminishing it. Speaking about price influence phenomenon we have to bear in mind not only the price of productive output of particular economic agent, but what is far more important from the point of view of societal consequences - also the price of its production input, potential reduction of which price represents another strong motivation for emergence of exclusive property rights.

As long as socially stronger individuals get enough power or meet insignificant counteraction on behalf of their socially weaker compatriots, they are eager to create and maintain exclusive property rights. These rights are exclusive because certain people are having them, while others do not. These rights are social because they are founded on and supported by the mechanisms of power and coercion. Exclusive property rights represent specific social privilege possible only owing to association with the mechanisms of power and coercion and which are fundamentally based on appropriation of exclusive income. Conventional property rights or economic property rights can be realized by their proprietors only up to a degree allowed by existing in particular society exclusive property rights. People are motivated by the notion of "exclusive rights" as long as they are pursuing their interests. Exclusive rights are allowing realization of those interests in the most complete way, to the highest degree of comfort and in the longer time span. Under the conditions of scarce economic resources and striking poverty of "pre-capitalist " society only exclusive social or exclusive property rights were able to provide a relative degree of comfort. In order to protect these exclusive property rights from one side and in order to diminish and to destroy them from the other - people are uniting in social groups. People uniting in social groups in order to protect their exclusive property rights we call monopolistic social groups. People uniting in social groups in order to eliminate exclusive property rights of the others we call monopoly-dependent social groups. Between these two types of social groups a permanent eternal process of counteraction is going on. This process, which we call social counteraction, is playing an enormous role in economic development and social evolution. 

Single value of exclusive property rights from the point of view of their beneficiaries stands in associated possibilities to appropriate exclusive or monopolistic income. Under the "free market" property regime or under the lack of any exclusive property rights, everybody in society is getting his share of national income according to his economic contribution. Under the exclusive property rights certain people are obtaining social (based on mechanisms of power and coercion) opportunities to receive an exclusive income, which is not determined by the market or, what is the same, which is not determined by economic price voting with participation of every single individual in particular society.

Exclusive social and property rights are commonly familiar under the term “monopoly”. Though social definition of monopoly goes far beyond general understanding of economic monopoly. Economic monopoly is coming from economic competition, economies of scale as well as from certain specific knowledge or technology and is not based on the mechanisms of power and coercion (is not maintained by law or by the State). Though, usually any economic monopoly is eager to preserve itself relying on non-economic or social and power methods sometimes generating in this way social monopolization. Economic monopoly is relatively simple, comprehensively explored by economics and besides mostly useless for understanding of social processes and of society generally. In social sciences we, first of all, concern ourselves with social monopolies – monopolies based upon mechanisms of power and coercion. Power and coercion is finally what society is all about. Power and coercion are finding their fundamental expression in economics through particular exclusive rights for those people and social groups, which managed to utilize mechanisms of power and coercion to their utmost personal advantage and first of all in order to receive an exclusive (non-market) income.

Social monopolies can be of two basic types – production factor monopolies and structural monopolies. Structural monopoly is connected with the exclusive property rights in particular economic sector, on particular market or on particular territory. Structural monopolies are realized in favor of and are controlled by particular individuals or by groups of individuals. Production factor monopoly represents exclusive (based on mechanisms of power and coercion) social and property rights of particular social group (rather than of private individuals) upon certain particular production factor. They are exclusively monopolies of the social nature i.e. they are established and maintained only through an application of power and coercion. Because of their scale and complexity production factor monopolies are normally realized in favor of and are controlled by people united in social groups (slave-owners under slavery, land aristocracy under feudalism, etc.) rather than by separately taken private individuals. Production factor monopolies are determining the nature of particular social formation such as slavery (exclusive property rights upon slave’s labor), feudalism (exclusive property rights upon land), communism (complete realization of exclusive property rights upon the State including private property rights of communist dictators upon the entire State property) and modern socialism (exclusive property rights of representatives and top-level State bureaucracy as of the social group upon State property). Economic monopolization is significantly different from social one what concerns its causes and roots, even though on the surface economic and social monopolization sometimes may look alike.

Besides social monopolization people can obtain exclusive income (property) based upon power, force and coercion and not connected with any economic activity or simply based on non-voluntary property confiscations either through social expropriations or through simple private acts of robbery. These two types of exclusive income (property) appropriation are not engaging people in any long-term economic and social relations, but normally represent isolated one-time actions, which we call property rights violations. They are typically prohibited by law (robbery almost always, while social expropriations are typically prohibited under one type of law or even under one type of social formation, but are becoming to be acceptable under another, which is challenging the previous one as a result of social revolution for example). Vice a versa, law never prohibits social monopolization. Social monopolization (particularly production factor monopolies) is not only supported by overall social and legislative system, but is much rather creating and structuring the latter. Property rights violations and social monopolization taken together we call property rights imperfections. Property rights imperfections and particularly social monopolization represent a major barrier on the way of economic development and social evolution. It is also a major attribute of sociality in society or otherwise social monopolization is what society is all about. Without property rights imperfections and without social counteraction there would be nothing social in society - everything will be pure economy and will be determined and dictated only by economic reasoning. 

Just like any private individual, monopoly is having its strength or its power. Monopoly’s strength is determined by its level of association with the mechanisms of power and coercion and by a physical size of underlying it property. Because of such duality we have to differentiate between economic and social strength of monopoly. Economic strength of monopoly is based on absolute and comparative amounts of property and income linked with monopoly. Social strength of monopoly is determined by the social exclusivity of property claims on behalf of its proprietors.  Simply put, the social strength of monopoly is demonstrating how many people are associated with particular monopoly and how socially strong they are or how strong monopoly is correlated with the mechanisms of power and coercion. Even simpler - social strength of monopoly determines just how exclusive are those monopolistic rights.

Monopoly’s strength is a very important definition for evaluation of monopoly’s influence in society as well as for evaluation of the ways and general possibilities to get rid of it or to eliminate social monopoly. The stronger is monopoly – the more difficult is to destroy it. Since social monopoly is always associated with certain degree of injustice and inefficiency, people are very much opposing any social monopolization. Monopoly’s elimination is a fundamental task of social counteraction. Social counteraction is a direct and comprehensive social (based on force, power and coercion) interrelation between private individuals and social groups, which is shaping a balance of power in particular society. 

Three ways for elimination of monopoly can be identified – economic elimination, conventional property rights dispersion and social property rights dispersion. Every one of them either separately or in combination with the other two is leading to the same result – diminishing of monopoly’s strength. Economic elimination stands in reduction of physical and material volume of monopolistic property. Conventional property rights dispersion is based upon association with monopolistic property of a rising number of proprietors. Social property rights dispersion is connected with increasing social (based on mechanisms of power and coercion) access to particular monopolized property or production factor. If we think about an oil cartel of the beginning of twentieth century, then diminishing physical volume or diminishing monetary expression of its assets stands for economic elimination, growing number of shareholders – conventional property rights dispersion, while emergence of alternative oil suppliers and competition – social property rights dispersion. In fact, as we can see from this example, only social property rights dispersion is leading to a complete dissolution of monopoly, while the other two options are only diminishing monopoly’s strength. 

Monopoly’s elimination does not have to be associated with redistribution of property. Monopoly is a property by itself. Its association with any property is purely social (based on mechanisms of power and coercion), ideological and not immanent. Any property can be monopolized and with any property can be associated exclusive rights. However, no property per se intrinsically contains property rights imperfections. At the same time, normally we cannot have monopoly without underlying it property.

Societal significance of the conception of property rights imperfections stands in the fact that it defines such understandings as inefficiency, injustice and socialization. All of them are not only direct consequences of property rights imperfections, but rather represent their immanent characteristics. Importance of those conceptions for social sciences, society and social evolution is rather difficult to overestimate.

Economic inefficiency implies that particular property or particular economic resource, owing to a presence of exclusive property rights, costs to all the people or to entire society more than it would be otherwise under the lack of property rights imperfections. Economic inefficiency is based upon price influence situation and, making rather complicated things simple, means lower aggregate national output on account of higher monopolistic prices.

Major problem with social monopolization and property rights imperfections for people and economy is associated possibility to appropriate exclusive or monopolistic income based on mechanisms of power and coercion. Not only this is leading to social injustice, but is also significantly slowing down the entire process of economic development and social evolution. Appropriation of monopolistic income is bringing along two fundamental consequences - economic inefficiency and economic injustice. The whole point of exclusive property rights stands in receiving extra income or income, which would deem impossible under the free market conditions. This can only happen on account of the other people since a price of particular monopolized commodity is always different comparatively with monopoly free environment. Paying higher price for monopolized property or for particular commodity represents the nature of economic injustice. On the other hand, the higher price of monopolized commodity is ripping society off in terms of opportunity costs or in terms of giving away potential production opportunities, which would otherwise exist under the free market conditions. Less economic output under socially monopolized economic environment represents the nature of economic inefficiency. Economic inefficiency and economic injustice being two consequences of the same phenomenon of price influence situation always come together. What is inefficient is never fair and vice a versa - what is unfair is never efficient. We can never have inefficient but just social policies. In the best case it is an illusion, in the worst - an ideological cover up for concealed patterns of monopolistic income appropriation. Economic injustice is an immanent cause of any social injustice. Any particular case of social injustice is having its foundation in the injustice in income distribution, in violations of social rights and is finally based on the mechanisms of power and coercion.

There are basically two ways to earn a living in society. First one is socialized, which implies that a person does not earn his money on account of the other people and does not get any exclusive income based on mechanisms of power and coercion. The second one is non-socialized when certain people getting an exclusive income based upon mechanisms of power and coercion are making their living, partially or entirely, on account of the other people. Socialized way happens either because people are socializing themselves voluntarily or conscientiously rejecting any opportunity to obtain exclusive property rights or because they simply do not have any possibility to gain exclusive property rights owing to market and to particular social conditions (to societal balance of power). The former situation we call self-socialization while the latter - market socialization or simply socialization. Socialization per se is based on social counteraction and stands in the lack of social (based upon mechanisms of power and coercion) possibilities to generate any property rights imperfections rather than in recognition of their harm to people and society.

Self-socialization is based upon deliberate recognition by particular individual of the fact that any exclusive social and property rights are “bad” for society, which consequentially leads to their rejection. Normally such deliberation is having place when particular individual is not experiencing existence of property rights imperfections himself personally and believes that society he is living in is perfect or close to that. To be sociable does not yet mean to be socialized. Vice-a-versa, to be associated with various social organizations and institutions based upon mechanisms of power and coercion is a perfect way to non-socialization.

Non-socialization is based upon presence of exclusive rights relying on force, power and coercion. Both social monopolization and property rights violations are equally leading to non-socialization. Any private individual, economic agent or social institution, which possesses exclusive rights based on mechanisms of power and coercion or which is socially associated with monopolized property, to one degree or another, is non-socialized. Non-socialized can be not only the actions of particular individuals but also those of particular social groups, social associations, those of the State and even those of society as a whole.

Since monopoly’s strength is a rather quantitative category, all definitions, which are coming from social monopolization can also be expressed in quantitative terms. On the other hand, since exclusive rights associated with particular property either exist or not - all social definitions are equally acquiring specifics of qualitative phenomenon. Such duality is evident and straightforward. We can always tell who is a real social proprietor of particular property, we can always tell whether this property is monopolized, inefficient, unfair and non-socialized, and we can always define a degree of its exclusivity, inefficiency, injustice and non-socialization.  

Social evolution is a process of gradual but permanent development of production factors and societal relations. From one side it is a process of economic development, while from the other side it is a social process of permanent perfection and advancement of society and first of all of the development and improvement of social and property relations. There is a serious contradiction in such duality. It is based upon the fact that economic development is permanent and almost uninterruptible process, while social and property relations are much rather a stubborn, rigid and inflexible phenomenon. Normally they  climb up to some qualitatively new level under the social pressure rather than permanently develop. They are stubborn, first of all, because of the interests associated with exclusive property rights and with exclusive income appropriation possibilities, which tend to preserve and to keep intact existing social and property relations.

Those interests employ for their purposes all available social instruments and first of all the entire society or the entire social infrastructure. Social infrastructure includes law, moral, politics, culture, education, customs, etc., or otherwise it is simply a more scientific expression for what we understand under the term "society". Generally speaking social infrastructure serves as a tool for maintenance of existing social order or of the current system of social and property relations. If we imagine a course of social evolution as permanently improving and advancing society – not only economically, but also what concerns property relations and societal system – then we will have to admit that society or rather social infrastructure by maintaining existing social order to one degree or another is standing on the way of social and economic progress. Because of such nature social infrastructure is not something neutral. It is having its own distinctive character and its own distinctive interests – it serves in order for no matter what to preserve existing social and property relations. Sometimes this might be beneficial, sometimes reactionary, but never neutral or impartial.

Fortunately people are having a substantial instrument in order to annihilate a reactionary influence of social infrastructure – social counteraction. Social counteraction represents united people’s opposition to any property rights imperfections. Social counteraction exists always, but specifically accelerates when something in society is visibly or noticeably wrong and to determine whether something is wrong or not help the conceptions of injustice, inefficiency and corruption. Although social counteraction is quite independent and sufficiently strong tool for annihilation of property rights imperfections, it is very much enforced by production factors development or simply by the economic development. Economic development is not only crushing old systems of social and property relations from outside, but what is equally important it supplies an opposition to particular social regime with additional financial resources (coming from economic growth and higher personal incomes) and therefore with additional power and additional strength.

Under the general conditions of sociality prevailing in human society throughout the entire history production factors or economic development is permanently in opposition to property rights imperfections or to the current system of social and property relations. Interaction between production factors development and between current system of property relations is the main engine of social evolution. Together with the development of production factors, technology and information an old system of property relations is experiencing a constant pressure on behalf of the people. Such pressure is realized through social counteraction - people are simply fighting their way through to better life and to less oppression and less injustice in society. There are two fundamental social consequences of the contradiction between production factors development and property relations. In the short-term - property relations are determining pace and level of economic development being a single impediment on the way of production factors development. In the long-term, however, production factors development is influencing and adjusting a current system of property relations through the process of social counteraction. System of property relations at every particular point in time is influencing and determining all elements of social infrastructure, which represents a composition of social, cultural and educational elements interrelated in a way specific for every particular social formation, country or civilization. 

State being a final instance of power and coercion is one of the most fascinating phenomena in human society. Nature of the State bearing mysterious character for the people throughout the entire human history is rather simple from the point of view of property relations. State is a production factor monopoly with all immanent and inherent characteristics of any monopoly of a kind. State is a production factor since any economic or production activity is impossible without some kind of regulatory entity at macroeconomic or social level. Just like any production activity is impossible without capital, labor and land, which we understand under definition of production factors or of fundamental groups of economic resources, in the very same way any production activity is impossible without the State. State is monopoly since there is nothing of a kind on any particular territory. There is simply no any other regulatory entity. State is not only a social monopoly based on power and coercion, but in fact it is a quintessence of coercion. Major immanent characteristics attributable to any production factor monopoly such as appropriation of exclusive or monopolistic income, economic inefficiency, economic injustice and non-socialization are also attributable to the State. State being an essence of power and coercion to one degree or another is always a non-socialized social institution.

Just like any other social monopoly State is having its real proprietors who at the same time are appropriating exclusive or monopolistic income connected with the State. State property never belongs to all people on equal basis - under no circumstances it is a public property. Under dictatorship State property belongs to only one person - the dictator - and is transforming into his private property. Under democracy property rights upon the State are merely more dispersed and normally belong to top-level State bureaucracy (including representatives). People's claims upon State property and especially upon the State revenues represent pure costs for a State monopoly, while State "profits" (income and benefits of top-level state bureaucracy) are basically distributed and consumed in one small happy family of the top State executives. State profits are distributed in a large variety of ways, often concealed and invisible, such as for example salaries and bonuses, luxurious traveling and transportation, luxurious offices, luxurious wining and dining, influence upon business and business contracting, after-the-office incomes and carrier expectations, immense possibilities for employment of friends and relatives, promotional opportunities for associated political parties, organizations, companies and private interests, personal connections and social ties, etc., etc., etc. Not only common people do not exercise any management functions related to the State property, but in fact vast majority of them are having much stronger interests in managing their own property. This creates a phenomenon of interests' dispersion or interests' diversion away from the State property. On the other hand, top level State bureaucracy being among the socially strongest individuals in society (one have to be smart and strong in order to get into significantly closed power circles) will not allow people to be associated  with management of the State property and, first of all, with distribution of State revenues that easily.

Unlike elimination of any other social monopoly elimination of the State monopoly is a bit tricky. It is almost impossible to get rid of the State. A single way of suppression of the State monopoly if not of its complete elimination is an open economic and social competition between the States - competition for people, resources and capital. As of today, this is probably the only viable expression of social property rights dispersion related to the State production factor monopoly. Another very efficient way of dealing with the State monopoly is its economic counteraction through drastic reduction of the State expenditures.

The Property

General Theory of the State and Social Evolution

Guide to the Phenomenon of StatE 

(Manifesto of the State's Nature)

On the nature of property Introduction into the nature of State Property Real State Proprietors State as Conventional Commercial Enterprise The State and Communism Why Democracy is just not enough Capitalism against Democracy Legal Corruption Socialist Ideas Income Redistribution and Social Idealism

Few words on the nature of Taxation Our Values and Social Mendacity Our Society and Social Expropriations Liberal, Conservative and Libertarian Principles Contemporary meaning of the wealth of nations Western democracies and their friends Fundamental problems with International aid A word of caution on European unification What is wrong with international order The State

 

 

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