CHAPTER XVI. KNOWLEDGE, TRUE AND FALSE.
Our theory of property rights can be used to unravel a tangled skein of complex problems
revolving around questions of knowledge, true and false, and the dissemination of that knowledge.
Does Smith, for example, have the right—again, we are concerned about his right, not the
to print and disseminate the statement that Jones is a liar, or that Jones is a convicted thief, or that Jones is a homosexual.
There are three logical possibilities about the truth of such a statement.
A. That the statement about Jones is true.
B. That it is false and Smith knows it is false.
Or, see, most realistically, that the truth or falsity of the statement is a fuzzy zone,
not certainly and precisely knowable.
For example, in the above cases, whether or not someone is a liar depends on how many
and how intense the pattern of lies a person has told, and is a judge to add up to the
category of liar, an area where individual judgments can and will properly differ.
Suppose that Smith's statement is definitely true.
It seems clear then that Smith has a perfect right to print and disseminate the statement,
for it is within his property right to do so.
It is also, of course, within the property right of Jones to try to rebut the statement
in his turn.
The current libel laws make Smith's action illegal if done with malicious intent, even
though the information be true.
And yet, surely, legality or illegality should depend not on the motivation of the actor,
but on the objective nature of the act.
If an action is objectively non-invasive, then it should be legal regardless of the
benevolent or malicious intentions of the actor, though the latter may well be relevant
to the morality of the action.
And this is aside from the obvious difficulties in legally determining an individual's subjective
It might, however, be charged that Smith does not have the right to print such a statement, because Jones has a right to privacy, his human right, which Smith does not have the right to violate.
But is there really such a right to privacy? How can there be? How can there be a right to prevent Smith by force from disseminating knowledge which he possesses?
Surely, there can be no such right. Smith owns his own body, and therefore has the property
right to own the knowledge he has inside his head, including his knowledge about Jones,
and therefore he has the corollary right to print and disseminate that knowledge. In short,
as in the case of the human right to free speech, there is no such thing as a right
to Privacy except the right to protect one's property from invasion.
The only right to privacy is the right to protect one's property from being invaded
by someone else.
In brief, no one has the right to burgle someone else's home or to wiretap someone's
phone lines.
Wiretapping is properly a crime not because of some vague and woolly invasion of a right
to Privacy but because it is an invasion of the property right of the person being wiretapped.
At the present time the courts distinguish between persons in the public eye who are
adjudged not to have a right to privacy against being mentioned in the public press, and private
persons who are considered to have such a right.
And yet such distinctions are surely fallacious.
To the libertarian, everyone has the same right in his person and in the goods which
he finds, inherits or buys, and it is illegitimate to make distinctions in property right between
one group of people and another.
If there were some sort of right to privacy, then simply being mentioned widely in the
press, that is, previous losses of the right, could scarcely warrant being deprived of such
right completely.
No, the only proper course is to maintain that no one has any spurious right to privacy
or right not to be mentioned publicly, while everyone has the right to protect his property
against invasion.
No one can have a property right in the knowledge in someone else's head.
In recent years, Watergate and the Pentagon Papers have brought to the fore such questions
Treatments as Privacy, the Privileges of Newspaper Men, and the Public's Right to Know.
Should for example a Newspaper Man have the right to protect his sources of information
in court?
Many people claim that Newspaper Men have such a right, basing that claim either A.
on special privileges of confidentiality allegedly accruing to Newspaper Men, lawyers, doctors,
on the public's right to know, and hence on the widest possible knowledge as disseminated in the press.
And yet it should be clear by this point that both such claims are spurious.
On the latter point, no one person or group of people, and therefore the public, has the right to know anything.
They have no right to knowledge which other people have and refuse to disseminate.
For if a man has the absolute right to disseminate knowledge inside his head, he also has the
corollary right not to disseminate that knowledge.
There is no right to know.
There is only the right of the knower to either disseminate his knowledge or to keep silent.
Neither can any particular profession, be it newsmen or physicians, claim any particular
The solution to the problem of the newsman's sources, indeed, rests in the right of the
knower, any knower, to keep silent, to not disseminate knowledge if he so desires. Hence
not only newsmen and physicians, but everyone should have the right to protect their sources
or to be silent, in court or anywhere else.
And this indeed is the other side of the coin of our previous strictures against the compulsory
subpoena power.
No one should be forced to testify at all, not only against himself, as in the Fifth
Amendment, but against or for anyone else.
Compulsory testimony itself is the central evil in this entire problem.
There is, however, an exception to the right to use and disseminate the knowledge within
one's head, namely, if it was procured from someone else as a conditional rather than
absolute ownership.
Thus, suppose that Brown allows Green into his home and shows him an invention of Brown's
hitherto kept secret, but only on the condition that Green keeps this information private.
In that case, Brown has granted to Greene not absolute ownership of the knowledge of
his invention, but conditional ownership, with Brown retaining the ownership power to
disseminate the knowledge of the invention.
If Greene discloses the invention anyway, he is violating the residual property right
of Brown to disseminate knowledge of the invention, and is therefore to that extent a thief.
Violation of common law copyright is an equivalent violation of contract and theft of property.
For suppose that Brown builds a better mousetrap and sells it widely, but stamps each mousetrap
copyright Mr. Brown.
What he is then doing is selling not the entire property right in each mousetrap, but the
right to do anything with the mousetrap except to sell it, or an identical copy, to someone
else.
The right to sell the brown mousetrap is retained in perpetuity by Brown. Hence for a mousetrap
buyer, green, to go ahead and sell identical mousetraps is a violation of his contract
and of the property right of Brown, and therefore prosecutable as theft. Hence our theory of
property rights includes the inviolability of contractual copyright.
A common objection runs as follows.
All right, it would be criminal for Green to produce and sell the brown mousetrap.
But suppose that someone else, Black, who had not made a contract with Brown, happens
to see Green's mousetrap and then goes ahead and produces and sells the replica.
Why should he be prosecuted?
The answer is that, as in the case of our critique of negotiable instruments, no one
One can acquire a greater property title in something than has already been given away
or sold.
Green did not own the total property right in his mousetrap in accordance with his contract
with Brown, but only all rights except to sell it or a replica.
But therefore Black's title in the mousetrap, the ownership of the ideas in Black's head,
can be no greater than Green's, and therefore he too would be a violator of Brown's property
even though he himself had not made the actual contract.
Of course there may be some difficulties in the actual enforcement of Brown's property
right, namely that as in all cases of alleged theft or other crime, every defendant is innocent
until proven guilty.
It would be necessary for Brown to prove that black, green would not pose a problem, had
access to Brown's mousetrap and did not invent this kind of mousetrap by himself independently.
By the nature of things, some products, for example, books, paintings, are easier to prove
to be unique products of individual minds than others, for example, mousetraps.
If then Smith has the absolute right to disseminate knowledge about Jones, we are still assuming
that the knowledge is correct, and has the corollary right to keep silent about that
knowledge, then a fortiori, surely he also has the right to go to Jones and receive payment
in exchange for not disseminating such information.
In short, Smith has the right to blackmail Jones.
As in all voluntary exchanges, both parties benefit from such an exchange. Smith receives
money and Jones obtains the service of Smith's not disseminating information about him, which
Jones does not wish to see others possess. The right to blackmail is deducible from the
general property right in one's person and knowledge, and the right to disseminate or
not disseminate that knowledge. How can the right to blackmail be denied?
When I first briefly adumbrated the right to blackmail in Man, Economy and State, Volume
1, I was met with a storm of abuse by critics who apparently believed that I was advocating
the morality of blackmail, again a failure to make the crucial distinction between the
legitimacy of a right and the morality or aesthetics of exercising that right.
Furthermore, as Professor Walter Block has trenchantly pointed out, on utilitarian grounds, the consequence of outlawing blackmail, for example, of preventing Smith from offering to sell his silence to Jones, will be to encourage Smith to disseminate his information, since he is coercively blocked from selling his silence.
The result will be an increased dissemination of derogatory information, so that Jones will be worse off from the outlawry of blackmail than he would have been if blackmail had been permitted.
Thus Block writes, What exactly is blackmail? Blackmail is the offer of a trade. It is the offer to trade something, usually silence, for some other good, usually money.
If the offer of the blackmail trade is accepted, then the blackmailer maintains his silence and the blackmailee pays the agreed amount of money.
If the blackmail offer is rejected, then the blackmailer may exercise his right of free speech and perhaps announce and publicize the secret.
The only difference between a gossip and blabbermouth and the blackmailer is that the blackmailer will refrain from speaking for a price.
In a sense, the gossip or the blabbermouth is much worse than the blackmailer, for the
blackmailer at least gives you a chance to shut him up. The blabbermouth and gossip just
up and spill the beans. A person with a secret he once kept will be much better off if a
blackmailer rather than a gossip or blabbermouth gets hold of it. With the blabbermouth or
For gossip, as we have said, all is lost.
With the blackmailer, one can only gain, or, at worst, be no worse off.
If the price required by the blackmailer for his silence is worth less than the secret,
the secret holder will pay off and accept the lesser of the two evils.
He will gain the difference to him between the value of the secret and the price of the
blackmailer.
It is only in the case that the blackmailer demands more than the secret is worth that
There are other and less important problems with the outlawry of a blackmail contract.
It goes that in the above case, instead of Smith going to Jones with an offer of silence,
Jones had heard of Smith's knowledge and his intent to print it, and went to Smith to offer
to purchase the latter's silence.
Should that contract be illegal?
And if so, why?
But if Jones' offer should be legal while Smith's is illegal, should it be illegal for
Smith to turn down Jones' offer and then ask for more money as the price of his silence?
Furthermore, should it be illegal for Smith to subtly let Jones know that Smith has the
information and intends to publish, and then allow Jones to make the actual offer?
But how could this simple letting Jones know in advance be considered as illegal?
Could it not be rather construed as a simple act of courtesy to Jones?
The Shoals get muddier and muddier, and the support for outlawry of blackmail contracts,
especially by libertarians who believe in property rights becomes ever more flimsy.
Of course, if Smith and Jones make a blackmail contract and then Smith violates it by printing
the information anyway, then Smith has stolen Jones' property, his money, and can be prosecuted
as in the case of any other thief who has aggressed against property rights by violating
a contract.
But there is nothing unique about blackmail contracts in this regard.
In contemplating the law of a free society, therefore, the libertarian must look at people
as acting within a general framework of absolute property rights and of the conditions of the
world around them at any given time.
In any exchange, any contract that they make, they believe that they will be better off
from making the exchange.
Hence, all of these contracts are productive in making them, at least prospectively, better off.
And, of course, all of these voluntary contracts are legitimate and licit in the free society.
We have therefore affirmed the legitimacy, the right, of Smith's either disseminating knowledge about Jones,
keeping silent about the knowledge, or engaging in a contract with Jones to sell his silence.
We have so far been assuming that Smith's knowledge is correct.
Suppose, however, that the knowledge is false, and Smith knows that it is false, the worst case.
Does Smith have the right to disseminate false information about Jones?
In short, should libel and slander be illegal in the free society?
And yet, once again, how can they be?
Smith has a property right to the ideas or opinions in his own head.
He also has a property right to print anything he wants and disseminate it.
He has a property right to say that Jones is a thief, even if he knows it to be false, and to print and sell that statement.
The counter view, and the current basis for holding libel and slander, especially of false statements to be illegal,
is that every man has a property right in his own reputation, that Smith's falsehoods damage that reputation and that therefore Smith's libels are invasions of Jones' property right in his reputation and should be illegal.
Yet again, on closer analysis, this is a fallacious view. For everyone, as we have stated, owns his own body. He has a property right in his own head and person.
But since every man owns his own mind, he cannot, therefore, own the minds of anyone else.
And yet, Joan's reputation is neither a physical entity, nor is it something contained within or on his own person.
Joan's reputation is purely a function of the subjective attitudes and beliefs about him contained in the minds of other people.
Let us consider in fact the implications of believing in a property right in one's reputation.
Suppose that Brown has produced his mousetrap and then Robinson comes out with a better
1.
The reputation of Brown for excellence in mousetraps now declines sharply, as consumers
shift their attitudes and their purchases and buy Robinson's mousetrap instead.
Can we not then say, on the principle of the reputation theory, that Robinson has injured
the reputation of Brown, and can we not then outlaw Robinson from competing with Brown?
If not, why not?
Or should it be illegal for Robinson to advertise and to tell the world that his mousetrap is better?
Or, to take another example, suppose that Robinson publishes an investment advisory letter
in which he sets forth his opinion that a certain corporation's stock is unsound
and will probably decline.
As a result of this advice, the stock falls in price.
Robinson's opinion has injured the reputation of the corporation and damaged its shareholders
through the decline in price caused by the lowering of confidence by investors in the
market.
Should Robinson's advice therefore be outlawed?
Or, in yet another example, A writes a book, B reviews the book and states that the book
is a bad one.
The result is an injury to A's reputation and a decline in the sales of the book as
well as A's income.
Should all unfavorable book reviews therefore be illegal?
As such are some of the logical implications of the property and reputation argument.
I am indebted for the stock market example to Williamson M. Evers.
In fact, of course, people's subjective attitudes and ideas about someone or his product will
fluctuate continually, and hence it is impossible for Brown to stabilize his reputation by coercion.
say it would be immoral and aggressive against other people's property right to try.
Aggressive and criminal, then, either to outlaw one's competition or to outlaw false libel's
spread about one or one's product.
We can, of course, readily concede the gross immorality of spreading false libel's about
another person.
But we must, nevertheless, maintain the legal right of anyone to do so.
Pragmatically, again, this situation may well redound to the benefit of the people being libeled, for in the current situation, when false libels are outlawed, the average person tends to believe that all derogatory reports spread about people are true, otherwise they'd sue for libel.
This situation discriminates against the poor, since poorer people are less likely to file
suits against libelers.
Hence the reputations of poorer or less wealthy persons are liable to suffer more now when
libel is outlawed than they would if libel were legitimate.
For in that libertarian society, since everyone would know that false stories are legal, there
would be far more skepticism on the part of the reading or listening public, who would
would insist on far more proof and believe fewer derogatory stories than they do now.
Furthermore, the current system discriminates against poorer people in another way, for
their own speech is restricted, since they are less likely to disseminate true but derogatory
knowledge about the wealthy for fear of having costly libel suits filed against them.
Hence, the outlawing of libel harms people of limited means in two ways, by making them
easier prey for libels, and by hampering their own dissemination of accurate knowledge about
the wealthy.
Finally, if anyone has the right knowingly to spread false libels about someone else,
then a fortiori, he of course has the right to disseminate those large numbers of statements
about others, which are in the fuzzy zone of not being clear or certain whether or not
the statements are true or false.