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their legal power over the instruments of wealth-production, command the services of thousands of industrial slaves whose faces they have never seen, without rendering any service to them or to society in exchange. A larger body of persons contribute some labor, but are able, from their cultivated ability or special education, to choose occupations for which the competition wage is still high, owing to the small number of possible competitors. These two classes together number only one-fifth of the whole. On the other hand is the great mass of the people, the weekly wage-earners, four out of five of the whole population, toiling perpetually for less than a third of the aggregate product of labor, at an annual wage averaging at most £ 40 per adult, hurried into unnecessarily early graves by the severity of their lives, and dying, as regards at least one-third of them, destitute or actually in receipt of poor-law relief.
Few can doubt the fundamental causes of this inequality of condition. The abstraction from the total of over one-third of the product necessarily makes a serious inroad in that which the "niggardliness of Nature" allows us, and the distribution of the remaining two-thirds is, of course, itself fatally affected by the secondary results of the division into "two nations which the private appropriation of rent and interest creates.
Can we Dodge the Law of Rent? Individualists may tell us of the good things that the worker could get for himself by thrift and sobriety, prudence and saving, but no economist will for a moment suggest that any conceivable advance in these virtues would remove the fundamental inequality arising from the phenomenon of rent. The mere worker, qua worker, is necessarily working, as far as its own remuneration is concerned, on the very worst land in economic use, with the very minimum advantage of industrial capital. Every development towards a freer Individualism must, indeed, inevitably emphasize the power of the owner of the superior instruments of wealth-production to obtain for himself all the advantages of their superiority. Individualists may prefer to blink this fact, and to leave it to be implied that, somehow or other, the virtuous artizan can dodge the law of rent. But against this complacent delusion of the philanthropist political economy emphatically protests. So long as the instruments of production are in unrestrained private ownership, so long must the tribute of the workers to the drones continue : so long will the toilers' reward inevitably be reduced by their exactions. No tinkering with the land laws can abolish or even diminish economic rent, however much it may result in the redistribution of this tribute. The whole equivalent of every source of fertility or advantage of all land over and above the worst in economic use is under free competition necessarily abstracted from the mere worker on it. So long as Lady Matheson can "own" the island of Lewis, and (as she says) do what she likes with her own—so long as the Earls of Derby can appropriate at their ease the unearned increment of Bootle or Bury -it is the very emphatic teaching of political economy that the earth may be the Lord's, but the fulness thereof must inevitably be the landlord's.
There is an interesting episode in English history among James I.'s disputes with the Corporation of London, then the protector of popular liberties. James, in his wrath, threatened to remove the Court to Oxford. “ Provided only your Majesty leave us the Thames,” cleverly replied the Lord Mayor. But economic dominion is more subtle than kingcraft-our landlords steal from us even the Thames. No Londoner who is not a landlord could, under completely free Individualism, obtain one farthing's worth of economic benefit from the existence of London's ocean highway; the whole equivalent of its industrial advantage would necessarily go to swell the compulsory tribute of London's annual rental.
It has often been vaguely hoped that this iron law was true only of land, and that, in some unexplained way, the worker did get the advantage of other forms of industrial capital. But further economic analysis shows, as Whately long ago hinted, that rent is a genus of which land rent is only one species. The worker in the factory is now seen to work no shorter hours or gain no higher wages merely because the product of his labor is multiplied a hundred-fold by machinery which he does not own.
Whatever may be the effect of invention on the wages of one generation as compared with the last, it has now become more than doubtful to economists whether the worker can count on getting any more of the product of the machine, in a state of " complete personal liberty," than his colleague contemporaneously laboring at the very margin of cultivation with the very minimum of capital. The artizan producing boots by the hundred in the modern machine works of Southwark or Northampton gets no higher wages than the surviving hand cobbler in the by-street. The whole differential advantage of all but the worst industrial capital, like the whole differential advantage of all but the worst land, necessarily goes to him who legally owns it. The mere worker can have none of them. " The remuneration of labor, as such," wrote Cairnes in 1874, "skilled or unskilled, can never rise much above its present level.
The “ Population Question." Neither can we say that it is the increase of population which effects this result. During the present century, indeed, in spite of an unparalleled increase in numbers, the wealth annually produced in England per head has nearly doubled. If population became stationary to-morrow, and complete personal liberty prevailed, with any amount of temperance, prudence, and sympathy, the present rent and interest would not be affected; our numbers determine,
Some Leading Principles, p. 348.
† Hence the remarkable suppression of “ Malthusianism" in all recent economic literature, notably the handbooks of Symes, Cannan, Ely, and Gonner; and its significantly narrow subordination in Prof. Marshall's Principles of Economics. The birth-rate of Great Britain is now apparently lower than it has ever been during the whole of the past century, and it seems tending steadily downwards.
indeed, how bad the margin of cultivation will be, and this is of serious import enough ; but, increase or no increase, the private ownership of land and capital necessarily involves the complete exclusion of the mere worker, as such, from all the economic advantages of the fertile soil on which he is born, and of the buildings, machinery, and railways he finds around him.
The “ Wickedness" of Making any Change. Few Individualists, however, now attempt to deny the economic conclusion that the private ownership of land and capital necessarily involves a serious permanent inequality in the distribution of the annual product of the community; and that this inequality bears no relation to the relative industry or abstinence of the persons concerned. They regard it, however, as impossible to dispossess equitably those who now levy the tribute of rent and interest, and they are therefore driven silently to drop their original ideal of equality of opportuuity, and to acquiesce in the perpetual continuance of the inequality which they vainly deplore. It is immoral, we are told, to take any step, by taxation or otherwise, which would diminish even by a trifle the income of the present owners of the soil and their descendants for ever and ever. This cannot be done without sheer confiscation, which would be none the less confiscation because carried out gradually and under the guise of taxation.
The problem has, however, to be faced. Either we must submit for ever to hand over at least one-third of our annual product to those who do us the favor to own our country, without the obligation of rendering any service to the community, and to see this tribute augment with every advance in our industry and numbers, or else we must take steps, as considerately as may be possible, to put an end to this state of things. Nor does equity yield any such conclusive objection to the latter course. Even if the infant children of our proprietors have come into the world booted and spurred, it can scarcely be contended that whole generations of their descendants yet unborn have a vested interest to ride on the backs of whole generations of unborn workers. Few persons will believe that this globe must spin round the sun for ever charged with the colossal mortgage implied by private ownership of the ground-rents of great cities, merely because a few generations of mankind, over a small part of its area, could at first devise no better plan of appropriating its surface.
There is, indeed, much to be said in favor of the liberal treatment of the present generation of proprietors, and even of their children. But against the permanent welfare of the community the unborn have no rights; and not even a living proprietor can possess a vested interest in the existing system of taxation. The democracy may be trusted to find, in dealing with the landlord, that the resources of civilization are not exhausted. An increase in the death duties, the steady rise of local rates, the special taxation of urban ground values, the graduation and differentiation of the income-tax, the simple appropriation of the unearned increment, and the gradual acquire
ment of land and other monopolies by public authorities, will in due course suffice to “collectivize" the bulk of the tribute of rent and interest in a way which the democracy will regard as sufficiently equitable even if it does not satisfy the conscience of the proprietary class itself. This growth of collective ownership it is, and not any vain sharing out of property, which is to achieve the practical equality of opportunity at which democracy aims.
Why Inequality is Bad. Individualists have been driven, in their straits, to argue that inequality in wealth is in itself a good thing, and that the objection to it arises from the vain worship of a logical abstraction. But Socialists (who on this point are but taking up the old Radical position) base their indictment against inequality, not on any metaphysical grounds, but on the plain facts of its effect upon social life. The inequality of income at the present time obviously results in a flagrant "wrong production" of commodities. The unequal value of money to our paupers and our millionaires deprives the test of "effective demand” of all value as an index to social requirements, or even to the production of individual happiness. The last glass of wine at a plutocratic orgy, which may be deemed not even to satisfy any desire, is economically as urgently "demanded" as the whole day's maintenance of the dock laborer for which its cost would suffice. Whether London shall be provided with an Italian Opera, or with two Italian Operas, whilst a million of its citizens are without the means of decent life, is now determined, not with any reference to the genuine social needs of the capital of the world, or even by any comparison between the competing desires of its inhabitants, but by the chance vagaries of a few hundred wealthy families. It will be hard for the democracy to believe that the conscious public appropriation of municipalized rent would not result in a better adjustment of resources to needs, or, at any rate, in a more general satisfaction of individual desires, than this Individualist appropriation of personal tribute on the labors of others.
The Degradation of Character. A more serious result of the inequality of income caused by the private ownership of land and capital is its evil effect on human character and the multiplication of the race. It is not easy to compute the loss to the world's progress, the degradation of the world's art and literature, caused by the demoralization of excessive wealth. Equally difficult would it be to reckon up how many potential geniuses are crushed out of existence by lack of opportunity of training and scope. But a graver evil is the positive "wrongpopulation" which is the result of extreme poverty and its accompanying insensibility to all but the lowest side of human life. In a condition of society in which the average family income is but a little over £3 per week, the deduction of rent and interest for the benefit of a small class necessarily implies a vast majority of the population below the level of decent existence. The slums at the East End of London are the corollary of the mansions at the West End. The depression of the worker to the product of the margin of cultivation often leaves him nothing but the barest livelihood. No prudential considerations appeal to such a class. One consequence is the breeding in the slums of our great cities, and the overcrowded hovels of the rural poor, of a horde of semi-barbarians, whose unskilled labor is neither required in our present complex industrial organism, nor capable of earning a maintenance there. It was largely the
a recognition that it was hopeless to expect to spread a Malthusian prudence among this residuum that turned John Stuart Mill into a Socialist; and if this solution be rejected, the slums remain to the Individualist as the problem of the Sphinx, which his civilization must solve or perish.
The Loss of Freedom. It is less easy to secure adequate recognition of the next, aud in many respects the most serious “difficulty" of Individualism, namely, its inconsistency with democratic self-government. The Industrial Revolution with its splendid conquests over Nature, opened up a new avenue of personal power for the middle class, and for every one who could force his way into the ranks either of the proprietors of the new inachines, or of the captains of industry whom they necessitated. The enormous increase in personal power thus gained by a comparatively small number of persons, they and the economists not unnaturally mistook for a growth in general freedom. Nor was this opinion wholly incorrect. The industrial changes were, in a sense, themselves the result of progress in political liberty. The feudal restrictions and aristocratic tyranny of the eighteenth century gave way before the industrial spirit, and the politically free laborer came into existence. But the economic servitude of the worker did not disappear with his political bondage. With the chains of innate status there dropped off also its economic privileges, and the free laborer found himself in a community where the old common rights over the soil were being gradually but effectually extinguished. He became a landless stranger in his own country. The development of competitive production for sale in the world market, and the supremacy of the machine industry, involved moreover, in order to live, not merely access to the land, but the use, in addition, of increasingly large masses of capital—at first in agriculture, then foreign trade, then in manufacture, and finally now also in distributive industries. The mere worker became steadily less and less industrially independent as his political freedom increased. From a self-governing producing unit, he passed into a mere item in a vast industrial army over the organization and direction of which he had no control. He was free, but free only to choose to which master he would sell his labor-free only to decide from which proprietor he would beg that access to the new instruments of production without which he could not exist.
In an age of the Small Industry there was much to be said for the view that the greatest possible personal freedom was to be