The theory of original appropriation, what some call homesteading, works as follows. When two parties enter into conflicting use of a scarce resource, the party which was first making use of this resource should be recognized as the true owner of this resource. The reason is that this arrangement is Pareto-efficient: the original user was making himself better off while not making anyone else worse off by using this resource, which is not the case for the second user who interfered with the first user.
With such a rule in place it becomes worthwile to invest labor and capital in the appropriation of new resources, such as for example the very capital-intensive work of oil and mineral prospecting, while creating a disencentive to interfere with resources that have already been appropriated (or prospected). The original appropriators are rewarded for bringing new resources to the marketplace. This is beneficial beyond the original meaning of homesteading, where the homesteader presumably lives off the land for himself. The entire marketplace benefits from the capital investment in the appropriation of the new resource.
The problem of original appropriation runs into complications when dealing with resources which are being used by people who do not participate in the dispute resolution process of the market society, either because they are ruled by a superstitious belief in communal property or they are simply too primitive to even understand law. In this case the appropriation of the resource for the marketplace requires the use of force, but this is no different than the force that would be employed to drive off wild animals in order to bring land into cultivation. Force must be applied because rational argument will not work.
The state of the primitive societies of America differed greatly between the parts that were colonized by the English and the Spanish. The English settlers met with small nomadic tribes who had no problem accepting valuable goods in exchange for vacating land that was of little value to them due its lack of capital investment. The English settlers paid for their land as such and colonized North America by slowly crowding out and assimilating the natives up until the formation of the United States. In Central America there existed extremely powerful empires ruling over agrarian societies with settled capital. In order to colonize this land the Spanish subjugated the rulers and easily imposed the feudal mode of land ownership on the entire country at once, establishing themselves as the new landlords. They then converted the natives, living in much greater numbers due to their practice of agriculture, to their language and religion, explaining the drastically different racial appearance of Mexicans and other Latino-Americans compared with North Americans.
In so far as the case of Latin America is concerned, it cannot be said that any of the land was “homesteaded” by rugged independent farmers. Instead colonization was done through the conquest of an empire that was undoubtedly more evil than the feudal system that replaced it. That was a much better outcome for the slave tribes of the area than the perpetuation of the primitive society. Because no one was made worse off from this transfer of scarce goods other than the perpetrators of a tyrranical system, the owners of the land up to this day can be said to have a rightful claim to it.
Of course the situation has evolved greatly since the time of America’s colonization. The United States have grown from an alliance of homesteader communities to a continental and even worldwide empire which commands the right to determine the use of all land within its territory, as well as a good part of the oceans. This capital, although not directly entitled to anyone, is in the possession of a class of politicians who will not let it go back to nature. Any program of liberation of the land will involve a confrontation with this class of politician, and this confrontation will require, as in the case of prospecting for new resources, a considerable capital investment. Any of the land that is torn from the hands of the politicians will therefore immediately come into the possession of the group that has liberated it, and they will have a claim of prior use against any other. In the best case scenario the politicians will take direct payment in exchange for renouncing their claim on the resource, thus avoiding a costly fight. In that case the people who paid these politicians will have a prior claim to the resource as having been those who liberated it from the politicians, much like the Anglo-American settlers bribed the natives to leave the land they wanted to cultivate.
What this means is that true homesteading in the Anglo-American colonial sense is no longer possible in a world where the entire landmass, and most of the watermass, has been claimed by states. Instead, in order to promote the expansion of the free market society, the production of security from those states should be recognized as a legitimate form of appropriation, and there should come into existence an industry whose sole purpose is to take resources from the states and then sell them on the market. This will ensure the most rapid liberation of all of the world’s scarce resources, much like colonial homesteading ensure the most rapid production of arable land.