Discussing the Elephant in the Room: Indian Property Rights: New book calls for the economic advancement of First Nations

Commentary, Property Rights, Joseph Quesnel


Several years back, the Canadian Senate provided a useful example on how “elephants in the room” are studiously avoided, including why many First Nations are dirt-poor. Back then, the Standing Senate Committee on Aboriginal Peoples produced a study on Aboriginal economic development with the hopeful title,” “Sharing Canada’s Prosperity – A Hand up, not a Handout.”  While the report recognized Indian Act barriers, the study avoided the long-standing economic elephant: enforceable property rights on-reserve, due in part to antiquated Indian Act provisions.
Despite the centrality of private property within the modern economy, the Senate report devoted a scant one and half pages to the issue out of an 80-page report. Instead of examining the issue in-depth, scare tactics were used by invoking memories of the 19th century Dawes Act where the U.S. Congress forcefully divided up reserve lands among various tribes.
Unlike the Senate Committee, a recent book by two professors, Tom Flanagan and Christopher Alcantara, and economist André LeDressay, argues that property rights can be introduced incrementally and voluntarily, unlike the obvious negative examples of forced relocations in ages past.
In this bold new book, Beyond the Indian Act: Restoring Aboriginal Property Rights, the authors look at existing property rights regimes on reserves and propose a voluntary regime for First Nations to gain title over their own lands.
The chief strength of this work is its brevity. Many topics covered could fill volumes, but this book distils the essence of each subject: Flanagan looks at property rights in general and reveals individual and family property rights among indigenous peoples prior to European contact; Alcantara explains how existing property title on reserves are inadequate; and Le Dressay shows  how property rights and land titles could be implemented now.
And the book demolishes some myths. For example, the issue of indigenous property prior to contact has taken up many works, but Flanagan demolishes the mistaken belief indigenous people did not hold conceptions of private property before contact. While each tribe had a different mix of private and collective rights, Flanagan points to economic and anthropological research that shows all peoples have property rights when confronted with resource scarcity.
Alcantara’s section provides on-the-ground evidence of existing property rights on reserves, albeit in weakened form. He notes that while numerous systems exist and protect land ownership rights for band members to a certain extent, even the strongest forms, such as band-issued certificates of possession, are still limited within the broader economy.
Why does this matter? Because property rights are a necessary component of unleashing wealth creation the world over. Alcantra’s work on the existence of customary rights to individual land plots and certificates of possession is similar to the extra-legal property rights identified by economist Hernando de Soto. In his work, The Mystery of Capital, de Soto identified trillions of dollar in property and assets in the hands of the poor in developing countries, none of which they could use economically because the state refused to acknowledge its existence.
This research uncovered by Andre Le Dressay uncovers 6.5 million acres (2.7 hectares) of land held by First Nations but ultimately owned by the Crown. While not all of this land is prime, much is arable or contains timber, oil and natural gas, or mineral wealth. Even without prime land, all First Nations would see an instant increase in the value of their land if it was truly theirs. After all, Hong Kong has few natural resources; what Hong Kong has had over the past century was property rights which allowed land to be leveraged into loans, capital and wealth creation.
Endorsed by Aboriginal leader Manny Jules, the authors propose a First Nation Property Ownership Act that would transfer land title from the Crown to a willing First Nation which could then transfer that land to willing individuals.  To assuage critics, the authors stress the legislation would give underlying title to the First Nation government, which would still be able to adopt land use and zoning regulations.
The only matter missing in Beyond the Indian Act is the strong philosophical case for individual property rights. Although Flanagan touches on Lockean conceptions of natural rights and other philosophers, he argues the case comes from a historical context, as well as from nature.
Although the book is not intended solely for academics, it may help to reach critics who predictably but wrongly call the proposal “assimilationist.” The book is well-researched and is already being noticed in “Indian Country.” That means the elephant in the room is finally being discussed.