Property, Land, Revenue, and Policy

The East India Company, c.1757�1825

J. Albert Rorabacher

• Publisher: Routledge
• Year: 2016
• Print ISBN:
  9781138234871
• eBook ISBN:
  9781351997331
• Topic: Social Sciences
• Subtopic: Ethnic Studies
• Index: Social Sciences

For the first century-and-a-half of its nearly 275 year existence, the English East India Company remained ostensibly a mercantile enterprise, satisfied to simply trade, competing with other European traders. In the middle of the eighteenth century, as a response to French expansion in India, the East India Company redefined itself, becoming an active participant in India's 'game of thrones'. Through the use of its military might, only tentatively supported by the English Crown and Parliament, the Company dominated trade, became a king-maker, and ultimately a colonial administrator over much of the Indian Subcontinent. The Company had become a state in the guise of a merchant.

The Company consolidated its position in Bengal, then began to exert its power by toppling local potentates and absorbing one princely state after another. Confronted with a land system that was built on custom and tradition, and not law, with no tradition of land ownership, the British were forced to formulate a new land tenure and revenue system for India, one based on British principles of property.

Permanent Settlement was the new government's first attempt at creating a new revenue system. Through its creation, for the first time, private property rights were conferred on the formerly non-landowning zamindars. Which, as this authoritative volume notes in turn, created a land market, destabilizing the political and social structure of India irretrievably.

CHAPTER 1
Property, Property Rights, and Land Tenure

In the West, a number of interrelated concepts have done much to shape the prevailing culture - the ideas about property and its constituent parts among them; and nowhere else do you find such profound and almost fervent concern for these concepts. If one surveys world cultures before the advent of European colonialism and the transfer of Western cultural elements to non-Western societies, the right of individual private property seems to be largely an unknown concept.

Speculation on Property

Ellen Meiksins Wood correctly points out that Western political thought is disproportionately populated by 'early modern' thinkers and much of that thinking has been given to the issues of property, property rights, and private ownership.¹

Among these thinkers are Hobbes, Locke, Kant, Grotius, to name some of the more obvious. But, they were not the first 'Europeans' to consider these topics. The Greeks and Romans, as well as the medieval religious philosophers Thomas Aquinas and Augustine, each contributed to the thinking on issues of property in Western Civilization, either in the form of explanation or justification.

Surprisingly, in early Indian literature, speculation on these subjects is almost non-existent. A tremendous amount of thought and energy was given to religious and philosophical matters but little or no speculation or philosophical thought seems to have been devoted to the mundane topic of property. This is all the more intriguing since both Western European and ancient South Asian traditions have similar linguistic origins and it is language that shapes how we think and how we see the world.² While we acknowledge the existence of the 'Aryans', not as a race but as a collection of people who shared certain linguistic roots, those roots were, nonetheless, carried by humans and it is they who made their way into Europe and South Asia millennia ago. Even with similar cultural roots, they developed completely different attitudes toward property and land.³ Why?

Is the West's preoccupation with property and property rights simply a function of differences in political development, or differences in how the modern state or modern economy, or social forms emerged in two very different physical settings?⁴ Do differences in political form suggest that power, private property, and class structures reflect the people or the environment; and this, in turn, directs political discourse and political and economic thought?

While comprehensive answers to these fundamental questions are beyond the scope of the present work, it is hoped that some of the preliminary stepping stones toward answering these kinds of questions are contained herein.

* * *

Ayn Rand once wrote, in an attempt to define a right, saying: 'A "right" is a moral principle defining and sanctioning a man's freedom of action in a social context.'⁵ These rights generally are divided into two basic categories: those understood to be a gift of God, implanted in the nature of things; and legal rights, those legislated or granted by governments. Natural rights were defined by John Adams in the course of defining the rights of the inhabitants of the Commonwealth of Massachusetts on 1 September 1779, as follows:

Art. I. All men are born [equally] free and independent, and have certain natural, essential, and unalienable rights, among which may be reckoned the right of enjoying and defending their lives and liberties; that of acquiring, possessing, and protecting property; in fine, that of seeking and obtaining their safety and happiness.⁶

Many rights are so closely tied to property rights that they are virtually indistinguishable one from the other. For example, the right to buy and sell, or more broadly, to trade freely, is a property right. It is an aspect of the ownership of property.⁷ Free speech and a free press are fundamentally property rights but we ordinarily do not think of them as such. We only think of them when there is an attempt made to interfere with or infringe upon them.

There is no way of conceiving of individual rights other than as either property rights or extensions thereof. Our right to life stems from the fact that it is our own (and only) life. Our right to the disposal of our time stems from the fact that it is our own time. Our right to the use of our faculties, ingenuity, and creativeness stems from the fact that they are our own. Remove from them the concept of private property and the claim to them is extinguished. Individual rights are clearly the requirements of a person to benefit rather than suffer from living in a society and are requirements of man's rational nature. Rights are neither arbitrary nor negotiable. They are absolute requirements for life within a society. Stated categorically: Rights are absolute.

The United Nations' Universal Declaration of Human Rights, adopted in 1948, outlines basic human rights. Article No. 17 proclaims: (1) Everyone has the right to own property alone as well as in association with others; and (2) No one shall be arbitrarily deprived of his property.⁸ Although Article No. 17 states the United Nations' position, with about as much succinctness as possible; there are those who either deny, debate, refute, or refuse to grant this basic human right to others.

It has been suggested that the absence of individual property rights may be viewed as a basic disregard for individual human rights in many cultures. The individual remains subservient to the needs of the community — one's family, village, clan, or tribe. This viewpoint is patently Western chauvinism.

The Commons

As long as one has a respect for the communal use of any resource needed by the community - the commons - all is well. However, inevitably, the commons is subjected to overuse by greedy individuals. Using a grazing metaphor, Hardin called this behaviour 'the tragedy of the commons'. In his article, he states:

Each man is locked into a system that compels him to increase his herd without limit - in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons.⁹

Communal property use would seem to be the first natural step in the evolution of private property, emerging as societies evolve and develop. In economically simple societies, communal use of the land may suffice but as societies evolve, develop, and grow in complexity, property rights seem to also increase in complexity and formality.

Hardin was not the first to notice changes in how commonly held lands fall to human greed. Aristotle observed 'what is common to the greatest number has the least care bestowed upon it. Everyone thinks chiefly of his own, hardly at all of the common interest.'¹⁰ Hardin used his grazing commons as a metaphor for human nature, as well as a function of growing and later over-population. Unless the commons is rigidly enforced, it is subject to abuse.

Within essentially rural, low density, agrarian and non-agrarian societies, the commons may provide a workable framework for the organization of labour in pre-industrial societies; but as the society and political structures evolve in complexity, communal rights become incompatible with continued economic development and governance.¹¹ Inasmuch as the first steps toward industrialization were to be found in Western Europe, one might ask, was it industrialization that produced private property or vice versa?

There are those that suggest the need for private property developed out of unrepentant capitalism and industrialization. For some, the relationship between capitalism and the amount of common land is inversely proportional. Vandana Shiva, the Indian environmental activist and anti-globalization advocate, characterizes this 'relationship' as the process of enclosure, drawing upon the English enclosure process so well documented during the Tudor period.¹²

Others suggest, dating back to the Greeks and Romans, that the concept of property and, specifically private property and individual ownership of land, are natural desires. With the emergence of Greek city-states, property was seen as a gift from the gods and held by families.¹³ The Romans refined the Greek concepts of property, creating the concept of private property to facilitate 'dealings' among individual citizens.¹⁴

At the heart of the Company's solutions to the problems that faced its servants in Calcutta, upon being made the Diwan of Bengal, were the historical and philosophical differences that existed between the English and the Indians. Part of the problem had to do with how each thought of or understood the concepts of property, property rights, and land revenue.

Property and Property Rights

Within almost every modern society there exists some kind of system of property rights. For some time now, there have been those who have criticized the importance and emphasis that has been placed on 'property' rights over 'human' rights in much of both the developed and underdeveloped world, in the belief that people are being treated unfairly and have unequal opportunities. Sadly, and categorically; Inequality exists in every society.

There is only so much of everything — power, money, land, food, water, jobs, housing, healthcare, . . . The late economist, Armen Alchian, characterizes this conflict between property rights and human rights as nothing but an obstructional mirage. 'Property rights are human rights.'¹⁵ The definition, allocation, and protection of property rights represents one of the most complex and difficult concerns within every society; and it was one of the most contentious problems facing the East India Company after becoming the Diwan.

Currently, the debate over property and human rights is not one of either one or the other but the transfer of certain property rights from private ownership to government ownership; and it has been demonstrated that, in certain circumstances, the government's ownership of specific property rights has fostered more effective and functional economies. What no one seems to want, however, is the wholesale abolition of property rights.

Humans, time and again, have shown that they are generally and individually incapable of showing concern for the welfare of their fellow Man and the future consequences of their actions. When this happens, an outside authority - government - must step in to protect the interests of the majority for the sake of the greater good. Without governmental control of certain property rights there is no way to protect the public from individual actions. As James Madison commented in 1788,

If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself. A dependence on the people is, no doubt, the primary control on the government; but experience has taught mankind the necessity of auxiliary precautions.¹⁶

In the absence of overt government action to control the use and allocation of property, in some simpler societies, ostracism may serve as the mechanism of control.

Property rights, in addition to use and allocation, have additional attributes - exclusivity and the rights to delegate, rent, sell, or mortgage. Some rights are limited, sometimes by statute and sometimes by social convention. The three basic elements of private property are:

• Exclusivity or rights to choose the use of a resource.
• Exclusivity of rights to the services of a resource.
• Rights to exchange the resource on agreeable terms.

While we may perceive our rights as being curtailed by government action, most restrictions on property rights, in republican, democratic societies, are based on the will of the people, i.e. society. Under authoritarian governments, how...

Table of contents

• Cover
• Half Title
• Title
• Copyright
• Dedication
• Contents
• List of Figures and Maps
• Preface
• Acknowledgements
• Author's Notes
• Glossary
• 1. Property, Property Rights, and Land Tenure
• 2. The Setting
• 3. The Roots of Empire
• 4. Prelude to an Empire in India
• 5. The Bridgehead of Bengal: Empire, Personalities, and Nawabs
• 6. Sulivan, Leadership, and the Conquest of South Asia
• 7. Company Actions and Parliamentary Reactions: Changing Social and Political Ideologies in Britain
• 8. The Rise of the Zamindars
• 9. The Ideological Basis of Permanent Settlement
• 10. The Pivotal Questions and the Debates
• 11. Permanent Settlement and its Aftermath
• 12. The 'Other' British Land Revenue Systems
• 13. A Critical Time – 1750-1773: Principles, Policies, Personalities, and Ethos
• Bibliography
• Index