To understand Mill’s openness to socialism, we first have to grasp his profound dissatisfaction with the property system of his own time. He argued that private property, as it existed, failed to meet its own justification.

1.1. What Justifies Private Property?

For Mill, the moral and economic legitimacy of private property rests on a single, powerful principle: its direct connection to an individual’s own effort and sacrifice. He grounds this right in the idea that people are entitled to the fruits of their own labor.

…the recognition, in each person, of a right to the exclusive disposal of what he or she have produced by their own exertions, or received either by gift or by fair agreement…

— Principles, Book II, Ch. II, p. 98

In short, property rights are only truly legitimate when they are tied to an individual’s “labour and abstinence.” This simple principle forms the basis for his entire critique of the existing system.

1.2. Why the Current System Fails the Test

Mill argued forcefully that the principle of private property had “never yet had a fair trial.” He believed the system in his era was a distortion, corrupted by historical injustice and laws designed to benefit the few at the expense of the many. To build his case, Mill dismantles the existing property system not on socialist grounds, but on its own terms. Notice his three-pronged critique from Book II, Chapter I:

• Origins in Violence: The social arrangements of modern Europe did not begin with a just partition of resources. They were the result of “conquest and violence,” and the legal system still retained “many and large traces of its origin.”
• Fostering Inequality: Laws have historically been designed to create unfair advantages. They have “heaped impediments upon some, to give advantage to others,” preventing people from having a fair start in life.
• Rewarding Idleness: Mill’s sharpest critique was that the system distributed wealth in a way that was completely disconnected from work. He observed that wealth was apportioned “almost in an inverse ratio to the labour,” with the largest shares going to those who have never worked at all, while the most exhausting physical labor often failed to provide even the basic necessities of life.

1.3. Land: A Special Case

Mill treated property in land as fundamentally different from property in the products of labor. While a person could create a tool or a commodity, no one created the land itself.

He argued in Book II, Chapter II, that land is the “common inheritance” of the human race. Therefore, allowing an individual to have exclusive ownership is a “privilege” or “monopoly.” This privilege is not a fundamental right but a “necessary evil,” defensible only if it serves the greater public good (for example, by encouraging cultivation).

This view led him to a radical conclusion: the State has a right to any “spontaneous increase of rent”—that is, any increase in the value of land that results not from the owner’s own investment or labor, but from the general progress of society.

Mill’s profound sense that the existing property system was indefensible by its own standards compelled him to seriously consider radical alternatives, pushing his analysis toward the socialist theories emerging in his time.