.
[Excerpted from Economics
of Liberty, published in 1916 by Herman Kuehn, Minneapolis,
Minnesota]
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JOHN BEVERLEY ROBINSON
was an early associate of Louis F. Post, the noted single-taxer. as a
publisher of The Free Soiler in the early 1880s. He later went
from a Tolstoyan to an individualist anarchist, often writing for
Benj. R. Tucker's paper. Liberty. Along with Tucker, John Henry Mackay
and others, he rejected "natural rights" as fictitious and
embraced the egoism of Max Stirner and the mutualism of Proudhon,
whose General Idea of the Revolution in the 19th Century he translated
into English (1923 Freedom Press). ECONOMICS OF LIBERTY was inspired
by Proudhon's ideas.
In a commercial society there are two general divisions of activity,
production and exchange.
Corresponding to these there are two forms of privilege by which all
industry is controlled; land ownership, which controls production, and
the money privilege, which controls exchange. Our business now is with
the first of these, namely, the privilege of land ownership.
The word land, in its economic sense, is used in a far wider
significance than in its usual colloquial meaning. Land, in the economic
sense, means all natural opportunities for labor to exert itself.
Labor, in order to produce, must have material whereupon to work, a
place to stand while working, a place to lie while sleeping.
The farmer uses land directly; the cobbler and actor both directly and
indirectly. Both cobbler and actor must have a place to live and a place
to work, and for these they use land directly; the cobbler, in addition,
must have leather, which ultimately comes from the soil; and both
cobbler and actor must have food, which also conies from the toil; and
for these they are dependent upon the land indirectly.
Even water is land, economically speaking. Opportunities to produce "are
presented by waterfalls for power and by rivers for irrigation, by lakes
and oceans for fisheries, and by all navigable waters for
transportation. Although the high seas are free to all, after they are
once launched upon them, yet the sailor must have land whence to embark
and whereon to disembark.
If the whole earth were owned by one man, it would mean that he would
have absolute power, in law, to prevent all the rest from" working
or even existing upon it. He could put tip his signs, "Trespassers
not allowed," and there would be nothing for it but to emigrate to
another planet.
Or if the earth were owned by a hundred million men, it would leave the
remaining nine hundred million equally subject to the sovereign will of
the land owners.
And that is precisely the state of affairs that prevails today. The
population of the earth is estimated at something like fifteen hundred
millions. Of these how many are land owners. We can only guess. One in
ten? Surely not as many as that. One in a hundred? Perhaps one in a
hundred. That would be fifteen millions who own the earth and hold the
lives of the remaining fourteen hundred and eighty-five millions in
their hands.
For the owner of the land controls everything and everybody upon it;
and if these fifteen million land owners were to order the rest off
their land, where could they go? To the high road perhaps, where they
might walk until they starved, leaving the land owners the sole
inhabitants.
But the game of the land owners is not to order people off the earth.
Far from it! What they want is that as many people as possible should
live and labor upon the earth - their earth - on condition that they
give the land owners a large part of their product, in the form of Rent.
Rent is the part of the product taken by the land owners from the
producers for permitting the producers to go to work.
But, you may say, I have no interest in land rent. I am a clerk,
working for $16.00 a week, I do not use land. What have I to do with the
land question?
Your employer is perhaps a merchant, who pays $20,000 a year for his
warehouse. If it is in New York City, at least $10,000 of that will be
for ground rent. He employs half a dozen bookkeepers, and as many
salesmen and porters, possibly twenty in all. If he paid no ground rent
there would be $500 apiece available to raise the wages of all hands.
Have you, indeed, no interest in rent?
And how much do you pay for beard? And of her expenses, what part does
your boarding- house keeper pay for ground rent? And the dealer from
whom you buy your clothes -- what ground rent does he pay? On every side
you are bled by Rent.
And what does the land owner give in return? Remember, we are not
sneaking of buildings, but of the land only upon which the buildings
stand.
The land owner gives nothing whatever, but permission to you to live
and work on his land. He does not give his product in exchange for
yours. He did not produce the land. He obtained a title at law to it;
that is, a privilege to keep everybody off his land until they paid him
his price. He is well called the lord of the land - the landlord!
Even if the merchant has bought his warehouse outright, so that he pays
no rent directly, he still pays rent indirectly, through the purchase
price paid to the previous owner.
Directly or indirectly everybody must pay rent to the owners of the
soil. Either in the form of annual or monthly payments, or in the form
of a price paid for purchase, everybody must pay for a place to live
upon and a place to work upon.
But, you will say, men must be secure in the possession of the products
of their labor; and how can they be secure unless they own their land?
There are two kinds of land ownership, proprietorship or property, by
which the owner is absolute lord of the land, to use it or to hold it
out of use, as it may please him; and possession,* by which he is secure
in the tenure of land which he uses and occupies, but has no claim upon
it at all if he ceases to use it. He cannot hold it out of use, and
prevent others from using it. For the secure possession of his crops or
buildings or other products, he needs nothing but the possession of the
land which he uses.
For instance, in the mining regions, vast areas of mining tend are held
out of use by the misting companies, which own all the land about. How
long, do you think, would these terrible strikes in Colorado and
Michigan and West Virginia have tested, if the miners had been free to
go to work and open up new mines on the unused land? Not an hour! Not a
minute!
All that is necessary to do away with Rent is to do away with absolute
property in land; to make all land that is not in use free to anybody to
enter upon it and use it.
Nor will any temporizing measure short of this suffice. Great as were
the services of Henry George in familiarizing people with the
destructive nature of our present system of land tenure, his single tax
scheme cannot be regarded as a remedy.
For the reason that, if rent must be paid, it is no particular relief
to pay it to the government in the form of a tax, rather than to pay it
to an individual in the form of rent.
If the coal miners of West Virginia were free to go to work and open up
new mines on any unused land, it would immediately relieve the
situation; but if they first bad to pay a government tax, almost equal
to the rental value, they would be as badly off as ever; the land would
be as inaccessible as ever.
No, the only real remedy is a change of heart, through which land using
will be recognized as proper and legitimate, but land holding will be
regarded at robbery and piracy.
Economists distinguish two forms of rent, what is called economic rent
and monopolistic rent.
Economic rent is the difference in productiveness of different
localities. Thus, of two mines, one of which was richer in ore than the
other, the additional product of the richer mine would constitute the
economic rent of it. Monopoly rent is the price demanded by the owner of
the soil, whether as a lump purchase price or as the usual periodical
rental payments, regardless of its productiveness (See Appendix II).
It is monopoly rent that results in vacant land.
By making all unused and unoccupied land free for anybody to use,
monopoly rent would disappear, and monopoly price, the speculative price
at which vacant land is held, which is equivalent to rent, which is, in
fact, monopoly rent capitalized, could no longer exist.
But economic rent -- the advantage that might inhere in any particular
piece of land, from greater fertility of soil or superiority in
situation -- this economic rent would still remain. With this
difference, however, that the greater product would inure to the profit
of the users of die land, not of some so-called land owner.
The tendency of economic rent is always to reduce itself to a minimum;
because the inherent advantages of land are variable. That is, a
disadvantage for one sort of use is often an advantage for another.
On the shores of Lake Michigan are certain barren, sandy tracts, until
recently regarded as almost worthless for any use. It has been found
that they are peculiarly suited for growing peas; and now large
quantities of peas are produced upon them, and the price of land there
has risen tenfold.
The difference in natural advantages upon which economic rent is based,
are like the differences in natural ability of the workers; they are
differences in kind rather than in degree. The stupid, stolid worker may
be better fitted for certain kinds of work than one of more intelligent
nervous organisation. The swamp may not grow wheat; but may be admirably
suited to cranberries.
The differences in product caused by differences in personal qualities
and differences fat the qualities of the land both tend toward a
minimum, and eventually toward extinction.
Proprietorship in land, upon which monopoly rent, and its equivalent,
speculative price, are based, is quite different. It is wholly an
artificial privilege, which all the powers of government, and of our
privilege born law, are exerted to uphold.
The rent of monopoly, so far from being an addition to the product of
the worker, is a deduction from it, entirely to the advantage of the
landlord, and continually tending toward a maximum, as the land becomes
more and more completely monopolized.
Both government and law exist, as any lawyer can tell you, to protect
property, that is, proprietorship in land among other forms of property.
Without force, that is, government, proprietorship in land would cease;
and, on the other hand, without proprietorship there would be no
function for force government, and it would lapse into a more perfect
form of social organization.
A free association would uphold the producer in the possession of land
for use; and an efforts to restore the land to the people must include,
as a necessary condition, the extinction of the governmental form of
organisation and the erection of free society.
* Strictly, it is incorrect to call
possession ownership. The word is used to convey the idea that security
in possession may be attained without absolute ownership.
APPENDIX II
Economic rent is said to be inherent in the advantage obtained by the
producer who occupies a superior site-superior in fertility,
accessibility or otherwise.
'iO It is admitted that the market price is fixed by the cost of
production under the most adverse circumstances. Thus a farmer whose
farm was ten miles distant from the market would have to add the cost of
transportation for ten miles to the price of his product. One whose farm
was only one mile distant would have a proportionally less amount to pay
for transportation; but he could obtain the same price as the more
distant one. The additional amount above the cost thus obtained by the
occupant of the nearer site is held to be the economic rent.
This is the celebrated Ricardian theory of rent; and, at first sight,
it appears to be irrefutable.
I am strongly inclined to think that the theory is erroneous; that it
is, in homely phrase, putting the cart before the horse.
It is commonly said that the most valuable land brings the highest
rent, that less valuable land brings less rent, that the amount of rent
that can be obtained is in direct proportion to the value of the land,
and immediately results from it. Ordinarily no one would dispute this
proposition.
An opposite view, however, may be taken. Instead of saying that the
most valuable land brings the most rent because it is the most valuable,
we may turn it about and say that the most valuable land is the most
valuable because it brings the most rent. This seems to be the same
thing: it is really quite different.
In carrying on their various works of production, men do not all want
the same piece of land, nor even similar pieces. The farmer would have
no use for city lot for productive purposes at all. Under the present
system he could indeed by his power of monopolistic holding obtain a
price from somebody who could use it; but, without this power, such a
lot would be quite useless to mm for productive purposes.
On the other hand, his farm of forty acres would be equally useless to
a professional man, say a physician. And neither the farm nor the tot
would be of any use to a deep sea fisherman.
People require different quantities of land and different localities,
according to the character of the industry in which they engage. For
some mere desk room in an office is all that they need: for others, many
acres are necessary. But the desk-room man can do nothing with the
acres; while the acres man would be just as much at a loss to carry on
his business with only desk room.
Now the monopoly of all land makes it possible for the holders 61 land
to demand a certain average amount from all who work on the land, that
is, from everybody, whether the particular land each one needs be much
or little.
And this appears to be the reason why city land is commonly reckoned to
be more valuable than land in the country. City workers do not need much
land in their pursuits - would not be able to use it if they had it. But
monopoly takes an average equal share from each, and the rent of a
grocer store on a twenty-five by a hundred foot lot may equal or exceed
that for a large farm.
So that land of small area, upon which many people can work, permits
the exaction of a higher rent by monopoly, and is therefore accounted
more valuable.
When the elevator, and its offspring, the tall office building, were
invented, permitting workers to be piled up twenty stories high, instead
of five as before, the amount of rent that could be extracted from each
of them remained the same, but the amount that could be obtained per
square foot of ground was proportionally increased, and the land became
by just so much more valuable.
A mine is more valuable than the fields about it, because hundreds of
workers can produce in a limited area. Prom each one rent is exacted,
not directly, it is true, but by the reduction in wages that miners
suffer.
In a state of freedom, when land ceased to be monopolized, all this
would cease. The producer would use as much or as little land as might
be required by his vocation; and land would no longer have any value,
because no rent could be deducted front the product of the workers.
It is necessary for the production of all the varied products of
civilisation, that there should be different kinds of land, some arable,
some mineral, some waterpowers, some towns and villages. For each
variety of each different kind of product, minor differences in land are
needed; and, in the end, by a continual process of adjustment, each
piece of land would be used for the purpose for which it was best
fitted..
Differences in the natural qualities of land bear a close analogy to
differences in the natural ability of persons. So far from being a cause
of inequality in income, such differences, whether in the land or the
individual, are essential for equality. An equality not doled out as an
equal wage by a quasi-military government, but a powerful tendency to
substantial natural equality, as the sea tends to a level surface, in
spite of the waves that continually vary temporarily its placidity.
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