[01] But great as they thus appear, the
advantages of a transference of all public burdens to a tax upon
the value of land cannot be fully appreciated until we consider
the effect upon the distribution of wealth.
[02] Tracing out the cause of the unequal
distribution of wealth which appears in all civilized countries,
with a constant tendency to greater and greater inequality as
material progress goes on, we have found it in the fact that,
as civilization advances, the ownership of land, now in private
hands, gives a greater and greater power of appropriating the
wealth produced by labor and capital.
[03] Thus, to relieve labor and capital
from all taxation, direct and indirect, and to throw the burden
upon rent, would be, as far as it went, to counteract this tendency
to inequality, and, if it went so far as to take in taxation the
whole of rent, the cause of inequality would be totally destroyed.
Rent, instead of causing inequality, as now, would then promote
equality. Labor and capital would then receive the whole produce,
minus that portion taken by the state in the taxation of land
values, which, being applied to public purposes, would be equally
distributed in public benefits.
[04] That is to say, the wealth produced
in every community would be divided into two portions. One part
would be distributed in wages and interest between individual
producers, according to the part each had taken in the work of
production; the other part would go to the community as a whole,
to be distributed in public benefits to all its members. In this
all would share equally -- the weak with the strong, young children
and decrepit old men, the maimed, the halt, and the blind, as
well as the vigorous. And justly so -- for while one part represents
the result of individual effort in production, the other represents
the increased power with which the community as a whole aids the
individual.
[05] Thus, as material progress tends to
increase rent, were rent taken by the community for common purposes
the very cause which now tends to produce inequality as material
progress goes on would then tend to produce greater and greater
equality. Fully to understand this effect, let us revert to principles
previously worked out.
[06] We have seen that wages and interest
must everywhere be fixed by the rent line or margin of cultivation
-- that is to say, by the reward which labor and capital can secure
on land for which no rent is paid; that the aggregate amount of
wealth, which the aggregate of labor and capital employed in production
will receive, will be the amount of wealth produced (or rather,
when we consider taxes, the net amount), minus what is taken as
rent.
[07] We have seen that with material progress,
as it is at present going on, there is a twofold tendency to the
advance of rent. Both are to the increase of the proportion of
the wealth produced which goes as rent, and to the decrease of
the proportion which goes as wages and interest. But the first,
or natural tendency, which results from the laws of social development,
is to the increase of rent as a quantity, without the reduction
of wages and interest as quantities, or even with their quantitative
increase. The other tendency, which results from the unnatural
appropriation of land to private ownership, is to the increase
of rent as a quantity by the reduction of wages and interest as
quantities.
[08] Now, it is evident that to take rent
in taxation for public purposes, which virtually abolishes private
ownership in land, would be to destroy the tendency to an absolute
decrease in wages and interest, by destroying the speculative
monopolization of land and the speculative increase in rent. It
would be very largely to increase wages and interest, by throwing
open natural opportunities now monopolized and reducing the price
of land. Labor and capital would thus not merely gain what is
now taken from them in taxation, but would gain by the positive
decline in rent caused by the decrease in speculative land values.
A new equilibrium would be established, at which the common rate
of wages and interest would be much higher than now.
[09] But this new equilibrium established,
further advances in productive power, and the tendency in this
direction would be greatly accelerated, would result in still
increasing rent, not at the expense of wages and interest, but
by new gains in production, which, as rent would be taken by the
community for public uses, would accrue to the advantage of every
member of the community. Thus, as material progress went on, the
condition of the masses would constantly improve. Not merely one
class would become richer, but all would become richer; not merely
one class would have more of the necessaries, conveniences, and
elegancies of life, but all would have more. For, the increasing
power of production, which comes with increasing population, with
every new discovery in the productive arts, with every laborsaving
invention, with every extension and facilitation of exchanges,
could be monopolized by none. That part of the benefit which did
not go directly to increase the reward of labor and capital would
go to the state -- that is to say, to the whole community. With
all the enormous advantages, material and mental, of a dense population,
would be united the freedom and equality that can now be found
only in new and sparsely settled districts.
[10] And, then, consider how equalization
in the distribution of wealth would react upon production, everywhere
preventing waste, everywhere increasing power.
[11] If it were possible to express in
figures the direct pecuniary loss which society suffers from the
social maladjustments which condemn large classes to poverty and
vice, the estimate would be appalling. England maintains over
a million paupers on official charity; the city of New York alone
spends over seven million dollars a year in a similar way. But
what is spent from public funds, what is spent by charitable societies
and what is spent in individual charity, would, if aggregated,
be but the first and smallest item in the account. The potential
earnings of the labor thus going to waste, the cost of the reckless,
improvident and idle habits thus generated; the pecuniary loss,
to consider nothing more, suggested by the appalling statistics
of mortality, and especially infant mortality, among the poorer
classes; the waste indicated by the gin palaces or low groggeries
which increase as poverty deepens; the damage done by the vermin
of society that are bred of poverty and destitution -- the thieves,
prostitutes, beggars, and tramps; the cost of guarding society
against them, are all items in the sum which the present unjust
and unequal distribution of wealth takes from the aggregate which,
with present means of production, society might enjoy. Nor yet
shall we have completed the account. The ignorance and vice, the
recklessness and immorality engendered by the inequality in the
distribution of wealth show themselves in the imbecility and corruption
of government; and the waste of public revenues, and the still
greater waste involved in the ignorant and corrupt abuse of public
powers and functions, are their legitimate consequences.
[12] But the increase in wages, and the
opening of new avenues of employment which would result from the
appropriation of rent to public purposes, would not merely stop
these wastes and relieve society of these enormous losses; new
power would be added to labor. It is but a truism that labor is
most productive where its wages are largest. Poorly paid labor
is inefficient labor, the world over.
[13] What is remarked between the efficiency
of labor in the agricultural districts of England where different
rates of wages prevail; what Brassey noticed as between the work
done by his better paid English navvies and that done by the worse
paid labor of the continent; what was evident in the United States
as between slave labor and free labor; what is seen by the astonishing
number of mechanics or servants required in India or China to
get anything done, is universally true. The efficiency of labor
always increases with the habitual wages of labor -- for high
wages mean increased self-respect, intelligence, hope, and energy.
Man is not a machine, that will do so much and no more; he is
not an animal, whose powers may reach thus far and no further.
It is mind, not muscle, which is the great agent of production.
The physical power evolved in the human frame is one of the weakest
of forces, but for the human intelligence the resistless currents
of nature flow, and matter becomes plastic to the human will.
To increase the comforts, and leisure, and independence of the
masses is to increase their intelligence; it is to bring the brain
to the aid of the hand; it is to engage in the common work of
life the faculty which measures the animalcule and traces the
orbits of the stars!
[14] Who can say to what infinite powers
the wealth-producing capacity of labor may not be raised by social
adjustments which will give to the producers of wealth their fair
proportion of its advantages and enjoyments! With present processes
the gain would be simply incalculable, but just as wages are high,
so do the invention and utilization of improved processes and
machinery go on with greater rapidity and ease. That the wheat
crops of southern Russia are still reaped with the scythe and
beaten out with the flail is simply because wages are there so
low. American invention, American aptitude for laborsaving processes
and machinery are the result of the comparatively high wages that
have prevailed in the United States. Had our producers been condemned
to the low reward of the Egyptian fellah or Chinese coolie, we
would be drawing water by hand and transporting goods on the shoulders
of men. The increase in the reward of labor and capital would
still further stimulate invention and hasten the adoption of improved
processes, and these would truly appear, what in themselves they
really are -- an unmixed good. The injurious effects of laborsaving
machinery upon the working classes, that are now so often apparent,
and that, in spite of all argument, make so many people regard
machinery as an evil instead of a blessing, would disappear. Every
new power engaged in the service of man would improve the condition
of all. And from the general intelligence and mental activity
springing from this general improvement of condition would come
new developments of power of which we as yet cannot dream.
[15] But I shall not deny, and do not wish
to lose sight of the fact, that while thus preventing waste and
thus adding to the efficiency of labor, the equalization in the
distribution of wealth that would result from the simple plan
of taxation that I propose, must lessen the intensity with which
wealth is pursued. It seems to me that in a condition of society
in which no one need fear poverty, no one would desire great wealth
-- at least, no one would take the trouble to strive and to strain
for it as men do now. For, certainly, the spectacle of men who
have only a few years to live, slaving away their time for the
sake of dying rich, is in itself so unnatural and absurd, that
in a state of society where the abolition of the fear of want
had dissipated the envious admiration with which the masses of
men now regard the possession of great riches, whoever would toil
to acquire more than he cared to use would be looked upon as we
would now look on a man who would thatch his head with half a
dozen hats, or walk around in the hot sun with an overcoat on.
When every one is sure of being able to get enough, no one will
care to make a pack horse of himself.
[16] And though this incentive to production
be withdrawn, can we not spare it? Whatever may have been its
office in an earlier stage of development, it is not needed now.
The dangers that menace our civilization do not come from the
weakness of the springs of production. What it suffers from, and
what, if a remedy be not applied, it must die from, is unequal
distribution!
[17] Nor would the removal of this incentive,
regarded only from the standpoint of production, be an unmixed
loss. For, that the aggregate of production is greatly reduced
by the greed with which riches are pursued, is one of the most
obtrusive facts of modern society. While, were this insane desire
to get rich at any cost lessened, mental activities now devoted
to scraping together riches would be translated into far higher
spheres of usefulness.
