The Edges of the Field: Lessons on the Obligations of Ownership

The Edges of the Field: Lessons on the Obligations of Ownership

by Joseph William Singer
The Edges of the Field: Lessons on the Obligations of Ownership

The Edges of the Field: Lessons on the Obligations of Ownership

by Joseph William Singer

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Overview

In The Edges of the Field Harvard law professor Joseph William Singer offers a brilliant and cogent look at America's complex relation to property and ownership. Incorporating examples as far-reaching as the experience of Malden Mills owner and Polartec manufacturer Aaron Feuerstein, the Torah, and the musical Rent, Singer reminds us that ownership is a curious blend of security and vulnerability between owner and nonowner. He proposes that the manner in which property shapes social relations of power is as important as ownership rights. "A brilliant and creative idea that will sustain for the long-term our economic system." -Aaron Feuerstein, president and CEO of Malden Mills, Inc. "Startling new answers. Singer turns the inherently inegalitarian implication of property on its head." -(starred review) Publishers Weekly "In this compact, challenging book, Joseph Singer argues that with property rights go human responsibilities. The result is very welcome, readable achievement [that is] much needed." -Milner S. Ball, author of Called by Stories: Biblical Sagas and Their Challenge for Law "Harvard law professor Singer is an expert on property law, the focus of this often surprising meditation on what haves and have-nots owe each other." -Booklist Joseph William Singer is professor of law at Harvard Law School and author of Entitlement: The Paradoxes of Property. He lives in Cambridge, Massachusetts.

Product Details

ISBN-13: 9780807004395
Publisher: Beacon Press
Publication date: 05/11/2001
Edition description: New Edition
Pages: 136
Product dimensions: 5.50(w) x 8.50(h) x 0.50(d)

About the Author

Joseph William Singer is professor of law at Harvard Law School and author of Entitlement: The Paradoxes of Property. He lives in Cambridge, Massachusetts.

Read an Excerpt




Chapter One


Uncommon Decency


Where there are no human beings, be human.

—Hillel, Talmudic teacher

God may tell [Rachel] to hold back her tears; but it is just her refusal to do this, to "be comforted," that constitutes the work of faith in this world.

—Avivah Gottlieb Zornberg, Genesis


Just before Christmas 1995, the Malden Mills textile factory in Lawrence, Massachusetts, suffered a devastating fire. When the flames finally died down, three of the nine buildings were in ruins. The next day, the owner, Aaron Mordecai Feuerstein, assembled the workers in the high school gymnasium. They feared the worst. Most of the textile mills in New England had long ago moved to other parts of the country, other parts of the world. Feuerstein was seventy years old and might be ready to call it a day. The workers wondered if he would collect the insurance money and retire. What was going to happen to them?

    More than three thousand people worked for Malden Mills and their prospects looked bleak. Then Feuerstein got up to speak. To their astonishment, he announced that he would rebuild the factory and that he would rehire every worker who wanted a job. He would continue to pay their wages for the next month and they would each receive their expected $275 Christmas bonus on time. Pandemonium broke out in the gymnasium. It is reported that "grown men cried, and in the several languages of the largely immigrant workforce - Portuguese, Spanish, Québecois -prayers of thanksgiving were said."

    Feuerstein made good on his promises. Not only that: He continued to pay his workers' salaries for several more months, until he could no longer afford to do so. He had no legal obligation to pay these salaries or to help his employees get through the down time. The factory was rebuilt. As of 1998, almost all the workers had been rehired. And although he laid off three hundred workers because a part of the business had become unprofitable, he promised to try to rehire them within two years and provided an unusually generous package of benefits for those who lost their jobs, including extended health benefits, an extra month's pay, job retraining, and job placement assistance. When he has had to lay off workers, he has done what he can to rehire them. He is committed to creating jobs in his community. Because of his actions, the town of Lawrence avoided a potential economic calamity. For the individual workers and their families, Feuerstein's actions were a godsend.

    A godsend indeed. When he was asked why he did it, Feuerstein replied that he felt morally obligated. "The workers are depending upon me. The community is depending upon me. My customers are depending upon me. And my family." He knew that his actions would have consequences far beyond himself. "There was no way I was going to take about 3,000 people and throw them in the street. There was no way I was going to send the city of Lawrence into economic oblivion." And why not? "Because," he said, "it wouldn't be right."

    As an Orthodox Jew, Feuerstein relied on traditional Jewish teachings about the moral obligations of property owners. Feuerstein answered questions about his actions by quoting a Talmudic saying of the great Jewish teacher Hillel. "Where there are no men, be a man." Alternatively, "When all is moral chaos, this is the time for you to be a mensch." Mensch is a Yiddish word with no English equivalent. Its literal meaning is "man" or "human being" but when we say someone is a mensch we mean a compassionate, caring person, a person of integrity and honor, a good person who does the right thing, someone who looks out for others, someone whose actions warm your heart, someone you wish you were like.

    The reaction to Feuerstein's announcement was swift and heartfelt. Editorials praised him. Religious leaders lauded him in their sermons. As the fire occurred just before Christmas, many editorials and sermons remarked on the appropriateness of his actions in that season. He was called a "Jewish Santa Claus" and a "Christmas hero." In an age beset by downsizing, Feuerstein stood out. He believed he could be a good businessman and a good person at the same time. He did not segregate the values of the marketplace from his religious values. "God is one, which means to me there is one ethical standard," said Feuerstein. "The God in Lawrence is the same as the God in the marketplace, and there is one standard for us all." He regretted the fact that his actions were so atypical. "My celebrity," he said, "is a poor reflection of the values of today."


Morality and Economics

Why, indeed, were Feuerstein's actions both so unusual and so widely heralded? Here is the paradox: On one hand, Feuerstein did not see his actions as extraordinary; he did what anyone would have done if they could. He felt he had acted with common decency. On the other hand, he was acclaimed because, even though most people agreed that he had done the right thing, his actions were perceived to be unusual. The public felt he had acted with uncommon decency, and lauded him as a hero and a saint. If everyone agrees that he did the right thing, why was it so unusual an action?

    Other companies have not followed Feuerstein's example even though his actions garnered good publicity and may have even helped the company. Why don't others do the same? The answer is that most large companies are not privately owned by individuals like Feuerstein, but are publicly owned by shareholders. One might think that a publicly held company might have public obligations. The reality is that such companies are managed by professionals who are obligated under existing law to maximize returns to shareholders, whether or not this is in the greater public interest. Existing law not only does not encourage most employers to act as Feuerstein did, but may actually prohibit them from responding as he did. If the president of a publicly owned company had followed Feuerstein's example, he might have faced a lawsuit by disgruntled shareholders claiming that he was not maximizing the value of their shares and thus was acting in contradiction to his fiduciary duties to them as owners of the corporation. Paying money to workers that the company had no legal duty to pay would take money out of the pockets of the shareholders. Feuerstein himself recognized this. It is ironic that, under current law, privately held companies have greater freedom than publicly owned companies to develop business strategies that both keep the company profitable and protect the interests of employees and the community in which the business operates.

    If what Feuerstein did was so admirable, why is it illegal for most business managers to do what he did? Let us put the question more broadly: Can a religious or moral person be successful in business? Is it possible to be good and to do well at the same time? Does morality require us to look out for each other? If so, why does the law get in the way?

    The Feuerstein story is a symbol of the contradictions of our age. We are a nation seemingly committed to deregulation, the protection of private property, and the end of "welfare as we know it." At the same time, we are morally committed to the notions of equality, human dignity, compassion, and responsibility. These political and moral commitments are in some tension, if not outright contradiction. On one side are claims of property; on the other side are claims of humanity. On one side are claims to rights; on the other side are acknowledgments of responsibilities. On one side are the values of liberty and autonomy; on the other side are the values associated with security, social stability, and solidarity.

    The Feuerstein story is fascinating because it demonstrates a deep ambivalence about our brave new world of relentless individualism. While many of us are attracted to the images of liberty embedded in the vision of limited government, we are also worried about the insecurity this entails. After all, liberty seems to mean freedom from obligation. The promotion of liberty is an invitation to act in a self-interested manner. Self-interest has a pleasant face; it means that we can live our lives on our own terms. But it also has a dark side; it promotes indifference to the effects of one's actions on others. Indifference to others is not a virtue.

    When people go to church on Sunday or mosque or synagogue on Friday or Saturday, they hear about the sacredness of human life. They learn about obligations to others. They hear about the importance of charity. They reach out beyond themselves. They strive to give life meaning. But then they go to work on Monday and something dramatic happens. They set what they learned aside and compartmentalize, as if it only applied on the weekend or in the evenings. They forget what they heard about compassion and focus only on profit. They resist efforts to include safety features in cars. They seek relaxation of antipollution laws. They induce employees to work hard by false assurances of job security at the very moment they are making plans to close the factory. They vote for politicians who cut food stamps to poor children and deny government benefits to immigrants who are here legally.

    This comparison is overblown and tendentious, to be sure. Self-interest has a legitimate and expansive role in both private and public life. In a pluralistic society that separates church and state, religious and moral ideals do not coincide exactly with the norms that govern our economic institutions, if only because different religious traditions have different views about the relevance of religion to economic life and the content of the relevant norms. At the same time, public norms underlying law and economics cannot be completely divorced from controversial norms about morality and social justice. The reaction to Feuerstein demonstrates a disconnect between widely shared moral intuitions and our prevalent economic institutions and norms. We value self-interest but we also value compassion, and the gap between our moral intuitions and our economic and political practices is particularly wide now. In an age that laments the loss of moral values and old-fashioned community life, it is jarring that public policy is so oriented to the virtues of liberty and self-reliance. Surely morality entails at least a mix of self-interest and altruism, if not a healthy dose of compassion.

    We ignore our moral qualms about a market system that relentlessly casts individuals aside in the pursuit of short-run profits because we have been led to believe that regulation of the market infringes on both liberty and prosperity. The attractions of the model of limited government intervention in the world of the market are obvious, but the dangers are equally apparent. Freedom from overbearing government regulation is popular because it seems to promote both individual liberty and economic prosperity. But unrestrained markets can fail. Economists may wax eloquent about the magic of markets, but we did suffer a Great Depression when unregulated and speculative markets collapsed. And the benefits of markets may be distributed quite unequally. Our current era is one of economic growth combined with increasing inequality of both income and wealth. Moreover, prosperity is combined with instability and insecurity. In the age of global competition, downsizing, and rapid capital movement, people increasingly feel that they are being treated like numbers on a balance sheet. They face what Roberto Unger has called the "savagery of impatient money."

    Those who are looking for work face even more serious problems. Some downsized workers readjust and find fulfilling new jobs. Others do not have the skills needed to compete in this technological age. And the poor who are being thrown off welfare face insurmountable odds. The costs of maintaining a family, including food, clothing, housing, medical care, child care, and transportation, are higher than the wages available in the marketplace under the current minimum wage. Rebecca Blank notes that "full-time year-round work at the minimum wage produces $8,500 in gross income, well below the $11,900 poverty line for a family of three or the $15,000 poverty line for a family of 4." This gap is the difference between the ideal of personal responsibility and the reality of desperation. It is these vulnerabilities that raise fears in the hearts of both welfare recipients and workers.

    These fears explain the positive public reaction to Feuerstein. In an age of increasing uncertainty, Feuerstein seemed a bright light. His actions exposed the worries just beneath the surface in this era of economic prosperity. But they also revealed a different moral world. Richard Sennett has perceived that in this time of downsizing, people have begun to feel that they do not matter. "People are treated as disposable." Their own efforts may come to naught; they may be fired despite working hard and successfully. "The system," Sennett writes, "radiates indifference. It does so in terms of the outcomes of human striving, as in winner-take-all-markets, where there is little connection between risk and reward." Feuerstein bucked this trend. He treated his employees as if they mattered, because they in fact mattered to him. In so doing, he publicly recognized the value of their humanity. They count. Feuerstein was commended not because he was a saint but because it was widely felt that he had done the right thing in a world where many people do not. He had treated the people with whom he did business as many people wish they would be treated — as they believe they deserve to be treated. The question is not why Feuerstein's actions were praiseworthy (they were, after all, just common decency), but why a chief executive officer of a publicly owned corporation would be discouraged, and possibly even forbidden, by law to do what Feuerstein did. Why does the law get in the way? And why is it thought to be impossible to institutionalize these norms in the business world even when the law does not get in the way?

    Personal responsibility is the rule of the day, but Feuerstein's other-regarding acts brought tears to many eyes. He was an owner entitled — by law — to consider his interests alone; but he was also a religious Jew who understood law differently. He felt obligated to act lifnim mishurat hadin — beyond the letter of the law. The larger community found this praiseworthy. When people do more than they are required to do by law, it sometimes means that they are unusually good. But sometimes, it means that the law is in need of change. Feuerstein's actions were like a mirror that forced us to look at ourselves and to consider what we really value. Companies may be managed for profit, but we also know that they may be the backbone of a local community. Deregulation is our new civil religion, but we are uncomfortable with the plant closings, downsizings, and indifference that accompany it. We value liberty but we recognize that it undermines security. Feuerstein was met with affection and gratitude because his actions suggested that it was possible to bridge the tensions we face between liberty and security, rights and responsibilities, property and humanity.


Progressive Strategies and Moral Suasion

A number of progressive scholars have recently argued for public policies to improve the condition of both working people and the non-working poor. They argue that realistic opportunities do not now exist to enable every person to enter the economic system on fair terms. This is partly the result of government policy, they claim, and they urge government action to remedy this problem. They have noted the disappearance of good jobs at good wages (James K. Galbraith, Katherine Newman, John Schwarz, William Julius Wilson); the impossible dilemmas of poor mothers in caring for their children and meeting demands to work at low-paid jobs without adequate transportation, child care, medical insurance, or housing (Mary Jo Bane, Rebecca Blank, Lisa Dodd, David Ellwood, Joel F. Handler and Yeheskel Hasenfeld, Gwendolyn Mink, Robert M. Solow); the increasing inequality of income and wealth (Galbraith, Edward Wolff); widening racial divides (Wilson, Mink, Douglas Massey, Nancy Denton, Cornel West); institutional stagnation (Roberto Mangabeira Unger and West); and unchecked corporate power (Charles Derber).

    These scholars have proposed a variety of strategies for redressing inequality and restoring the American dream to millions of Americans who find themselves outside the boundaries of prosperity at the beginning of the new century. They present a compelling picture of an economy and a politics gone wrong. They also offer a sense that something can, in fact, be done about it. They point out that formulating policies that will work to restore access to the American dream for every person is a complicated business. Each solution creates its own problems and some solutions work at cross-purposes. Yet it is clearly possible to do better than we are currently doing to spread the benefits of economic life more evenly. We will accomplish this only if we wish it to be done. We will collectively wish it to be done only if we can build political support for appropriate governmental action. And we will build such support only if we can build a compelling moral case for doing something.

    Economic policies get translated into law only when public support can be galvanized. And public support is galvanized most effectively when private interests appear to converge with public norms. People want public policies that further their interests, but they would like to believe that such policies will not be unfair to others. More often than not, new public policies are supported by arguments that affirm their fairness and justice, as well as their efficacy at protecting and promoting legitimate interests. The rhetoric of morality pervades our political system. The statute that ended "welfare as we knew it" was called the Personal Responsibility and Work Opportunity Reconciliation Act. Its supporters argued that it would leave welfare recipients better off and that it would both induce them to take personal responsibility and promote opportunities for work that had previously been denied to them.

    The progressive scholars who have proposed new policies to create real opportunities for those set adrift by the end of welfare do not address the reasons why we lack the political will to do what they urge. They do not confront the ambivalence we feel about collective action to remedy the problems they identify. Nor do they confront the philosophic and legal barriers to doing what they so passionately claim is right. Why is there no movement to institutionalize Feuerstein's responses in policy or law so that other workers and other communities facing similar problems will find similar support? The problem is not that Americans lack compassion, but that American public policy does. Our political rhetoric is more individualist than our people are.

    We have come to believe that actions by either government or business to remedy the problems of poverty or joblessness are in conflict with both legal principles and economic realities. Regulation of business seems to contradict hallowed principles of liberty and private property and established economic wisdom. People have a mistaken view that acting collectively on our compassionate impulses will undermine our legal and economic system at the core — that it will kill the goose that laid the golden egg.

    No laws of economics or core principles of law prevent us from acting on individual and societal moral obligations to act compassionately to aid those victimized by economic change. It is widely assumed that property law protects the rights of owners to do what they like with their property and that these rights have few, if any limits. This view does not accord with the facts. There is far more continuity between our moral obligations and our legal institutions than most people realize. Although they are not identical, morality and law are not two completely separate systems of value. Rather, our core rules of property law contain multiple duties to limit property use so that it will not impinge on the legitimate interests of others. It will not undermine either private property or free enterprise to institutionalize through law the elements of Feuerstein's actions that seemed so strikingly admirable to many people. Indeed, establishing those elements as part of the law may not only not hurt our economic system but may well enhance it, as well as being the right thing to do.


Property and Obligation

Property is at the heart of the American self-image. With the collapse of communism, it is widely believed that an economic system that protects property rights not only produces the greatest prosperity but is an essential ingredient in creating a free and democratic society. I believe it is right to say that property is related to freedom. But it is often wrongly thought that this means that both freedom and security are best enhanced by letting owners and businesses use their property as they please, without regulation or limitation and that no social or political supports are necessary to ensure that individuals can become owners. The truth of the matter is that property systems will self-destruct without regulations designed to ensure that owners do not use their property in ways inimical to others. Moreover, no one acquires property by their own efforts alone. Both governmental and nongovernmental support are essential to any system of property — at least one supported by law rather than by brute force.

    Property promotes liberty by giving individuals the resources they need to create a home, engage in work, develop relationships with others, and live their lives on their own terms. If property is related to liberty, as I believe, then those who cannot obtain property cannot obtain liberty. Because property is exclusionary, protection of the rights of owners may have the effect of leaving others out of the system. It is not an accident that the crime rate has soared in South Africa, where roughly 10 percent of the people own 80 percent of the land as a result of the legacy of apartheid laws that denied the bulk of the population the right to own property simply because of their race. Unless the government there can implement policies that spread access to property more widely, the newfound ideals of equality, liberty, and democracy will be fatally undermined. It is essential to shape our property institutions so that it is realistically possible for everyone to enter the system and obtain a decent livelihood.

Table of Contents

Introduction1
CHAPTER 1 Uncommon Decency7
CHAPTER 2 Outside the Boundaries18
CHAPTER 3 The Edges of the Field38
CHAPTER 4 Rent63
CHAPTER 5 Common Decency84
Notes110
Acknowledgments124
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