The Essential Reform:
Land Value Taxation
In Theory and Practice
C. H. Chomley and R. L. Outhwaite
[Part 14 of 15]
THOSE who study the signs of the times can see that England has
arrived at the parting of the ways, where she must choose, and choose
quickly, between land values taxation and the abandonment of Free
Trade. The hard winter, with its starving women and children and its
battalions of unemployed, has come - the occasion so complacently
looked forward to by tariff reformers as providing favourable ground
for sowing broadcast the fallacious promises of Protection. They have
not neglected their work, and are confidently counting upon soon
reaping the harvest.
The time has gone by when men on short wages, unemployed men, and men
with the fear of unemployment constantly before their eyes, will be
satisfied with the assurance that England is the best of all possible
worlds, that distress is more acute and widespread in Protected
Germany and America than in un-Protected England, and that all they
need do for salvation is to hold fast by the axiomatic truths of Free
Trade. They may be assured that the plight of their country is not
worse than that of others; but this is no satisfaction to hungry men.
They are not in the mood for nice comparisons. They want hope of
better things, and it is offered them without stint or scruple by
tariff reformers with political or personal axes to grind. The Free
Trader has all the best of the argument, because his case is based on
truth and logic; but these advantages are nothing as compared with his
disadvantage in preaching a merely negative policy. It is useless to
say, " Do nothing, and all will be well," to people who feel
the pinch of poverty, and are, some sullenly, some passionately,
determined that something must be done.
National prejudices and hatreds fanned by the jingo press, crude
aspirations towards imperial unity, the hard fact that the Chancellor
must have more money to meet national obligations, all aid the tariff
reformer hi undermining the traditional belief in Free Trade. The
average elector is not persuaded that Free Trade is wrong; he has no
very great faith in the efficacy of Protection; but it is dinned1 into
his ears night and day, it appeals to his national and his fighting
instincts, and, above all, it promises change which can scarcely be
for the worse. So at least he thinks, and is hardly to be blamed for
not realising that Protection would drag the poor into greater depths
of wretchedness, and for turning away wearied from the dry-as-dust
Free Trade lecturer offering him the cold comfort of immutable
economic law, to listen, fascinated, if sceptical, to his mountebank
rival recklessly promising work for all.
It is not, however, pure accident that land values taxation and
Protection stand opposed just now as the only possible avenues which
men may follow in an effort to escape from the intolerable. There is
more in the simultaneous presentment of their rival claims to
attention than the fact that both promise industrial change and a
means of raising necessary revenue. In the first place, land values
taxation is the logical complement of Free Trade. Freedom to produce
is the natural complement of freedom to exchange, as Cobden clearly
recognised, when, on the eve of his campaign for abolition of the Corn
Laws, he urged the raising of twenty million pounds by taxation of the
landlords; as Mr. Reid, Premier of New South Wales, realised in 1895
when he allied a scheme of land values taxation with the sweeping away
of a Protective tariff and the introduction into his country of Free
Trade as complete as that of England.
In the second place, there is reason in the often-repeated question
of the artisan, "What is the use to me of cheap goods if I lose
my work and have no wages to buy them with?" Protection in
England would not give him the work and wages which can only come when
industry is freed from the land monopoly which shackles it; but the
question is unanswerable by men who cannot point the way to attack on
this monopoly.
Let us take the supposititious case of an island teeming with gold,
where monopoly of land and cheapness of goods, both of which have gone
to considerable lengths in England, are both carried to their ultimate
extreme -- monopoly to the absolute ownership of the island by one
man, and cheapness to a state of affairs when goods can be obtained
for almost nothing. On the island, let us suppose, when this marvel of
cheapness comes to pass, there are living besides the owner one
hundred people who have a foothold on the soil only by the grace of
the proprietor. Since the latter can obtain from abroad all the
necessaries and luxuries of life without paying anything appreciable
for them, it is clear that he will have no use for the majority of the
population. Half-a-dozen perhaps, to pick up the gold which pays for
his imported goods, would receive starvation wages. and be charged an
exorbitant rent for the cottage allotments allowed to them;
half-a-dozen more might be granted the privilege of carting imported
articles to the owner's house on the terms he chose to give; he might
confer a boon on a number of others by employing them as personal
servants. For the rest of the people he would have absolutely no use.
If he were humane, he might lodge them in a poor house; if he were
careless, he might allow; them to starve; if he resembled some British
land- if lords, he might drive them out of the country, as; the Duke
of Sutherland drove the people from their I forefathers' homes on his
estates to find a home abroad or perish in the sea.
In any case, if they remained, the phenomenal richness of the island
and the phenomenal cheapness of its markets would confer no advantage
upon them. Having no rights in their native soil, they would be denied
the freedom to produce anything to give in exchange for the cheap
goods purchasable with a minimum of labour, which should be a blessing
to all the inhabitants. They would go idle and starve in the midst of
plenty, as thousands of people do in England to-day.
In such a community one can imagine how eagerly the tariff reformer
would be listened to who promised Protection, a prohibitive tariff
which would stop the cheap goods coming in from abroad and force the
lord and master, the land-owner, either to go without his accustomed
comforts, or permit the native labourers to make them for him. "What
use," they would say, as the British labourer is saying
throughout the British Islands, "are cheap goods to me if I have
no work and wages wherewith to buy them ?" They would welcome the
tariff which forced the land-owner to employ them and to give them a
wage sufficient at least to sustain life, since dead they would be
useless.
This is the scintilla of truth in Protection, the tiny glimmer of
baleful light germinated by unwholesome festering conditions of
monopoly. It is hesitatingly followed by unhappy people, who can see
no other light as a possible guide to better things, and audaciously
proclaimed a beneficent star those whom monopoly enriches.
In the circumstances we have imagined Protection might -- probably
would -- mean more work, but work under the most wretched conditions
conceivable. The wages of the men hitherto employed would not be
raised, except perhaps sufficiently to meet the increased prices and
prevent the workers from starving. Every one upon the island would
remain hopelessly in the grip of the monopolist, who could raise his
rents to any point he chose compatible with permitting the persons for
whom he had any use to remain upon the island and live. Protection
would be a sorry remedy indeed for the evils of cheapness allied with
monopoly, which we have pictured, and yet it would be eagerly welcomed
by the proletariat who were offered nothing else.
But how they would spurn Protection and cling to Free Trade if they
were offered, as an alternative to Protection, a share in the land of
the island; if its owner were forced to pay its annual rent into a
fund which they shared equally with him! He could obtain the rent in
no way but by employing them, not on his terms, but on theirs. He
could not work the whole of the property himself in any case, but
would be forced to surrender portions of it to those who would make
the best use of it with their labour. Goods could not then be too
cheap to please the people. The cheaper they were the more of them
would they obtain in return for their wages or the produce of their
labour on the land, There could be no unemployed, since all would be
free to employ themselves, being equally owners of the land and able
to obtain it on equal terms.
Our imaginary island, without a tariff and without land values
taxation, is in the position towards which England is drifting. There
never will come a time, perhaps, when the whole of the British Isles
are in one man's grip, but it makes little difference to the landless
tens of millions whether the number of the land monopolists is one or
a few hundreds or a few thousands. They are equally denied their
rights in the land God meant for them, and in the value they have
given it. Their toil, made more fruitful every year by science and
machinery, enables the wealthy classes to satisfy all their desires at
less expenditure of the labour of the poor, and so, more and more
labourers become superfluous, drift down among the unemployable,
emigrate or starve.
Cheapness may never reach such a pitch that goods can be obtained for
almost nothing, but it has already got to a point which makes mention
of it as a blessing sound like mockery to the man who believes it is
driving him from work and leaving him without a penny to buy the
cheapest goods in the world. What cares the man who has worn the soles
from his boots in vain search for employment if the loaf is doubled in
price by any change, provided it enables him to earn a few pence to
buy a crust ? Free Trade must preach a more inspiring gospel than the
virtue of cheapness if it is to retain its hold upon the people, and,
as a matter of fact, even Free Traders are forced in practice to admit
that cheapness, under present conditions, may be sometimes rather a
curse than a blessing. It would, J for instance, greatly reduce the
price of many articles if all the prison labour of the country were
energetically applied to their manufacture. Yet who dare advocate such
a course? It would increase the wealth of the community, and increased
social wealth under a sane economic system would unadulterated good;
yet set prison labour effectively to work, let us say in making boots,
and the cry; would go up with perfect justice that a cruel wrong; was
being done in taking the bread out of honest workers' mouths. It is a
monstrous thing that increase of wealth, of good things within a
country, can injure its people -- but it is true. Orthodox Free Trade
maintains the contrary, yet dare not act to its principles. The reason
is that orthodox Free Trade states only half a truth, namely, "Freedom
to exchange is necessary to social welfare." The other half of
the truth is " Necessary also is freedom to produce." If
freedom to produce were ensured by opening the land to labour, then
freedom to exchange goods made in prison for the lowest price could
injure no one. The cheaper they were the more of them would the poor
obtain for their money. This, indeed, they could at present, but
between conditions now and as they would be then there is difference.
At present the men who make boots would be thrown out of work if
millions of pairs of boots made by prison labour were put upon the
market. The potential buyers of boots would not be increased, and
portion of the free manufacture would cease. But if land values were
taxed, so that every man could employ himself or find employment, the
millions of people, who now must go without boots they need, would be
able to buy the millions of pairs that issued from the prisons, and
the increase of social wealth created by turning waste labour to
account would be a boon to men, as every increase of wealth must
necessarily be in a justly ordered world. The severest possible
condemnation of our present social system is the fact that one man can
injure another by making or doing useful things. We tacitly admit that
he can do so when we blame manufacturers for reckless over-production;
when the newspapers say that the cotton strike, which rendered men and
machinery idle, was good for trade; when professional musicians find
sympathy with their complaint of amateurs who sing at charity
concerts. In a world which thus approves restriction upon wealth
production and other social service, what chance of ultimately
prevailing has Free Trade? Men will not listen to its doctrine that no
restriction should be placed on wealth coming into a country, to its
condemnation of the prevention of cheapness by a tariff, when they
find almost universal agreement that the production of wealth within a
country, and the cheapness resulting from very great production, can
be beneficially restricted.
If over-production were a reality, as most Free Trade economists
assert, there could be no complete1 logical answer to the
Protectionist, who would check over-production by wasting labour power
through the friction of a tariff. It is a dim perception of this that
is turning the working classes from Free Trade, and they will never
pay whole-hearted allegiance to it again until they are shown that
there is no such thing as general over-production. There can be no
over-production of houses, of food, of clothes, of boots, until every
person is properly housed, and fed, and clothed, and shod. What we
call over-production is under-consumption, arising from the social
crime which gives the land, the store-house of wealth, to a few, and
denies the worker the right to consume the wealth he makes for others.
Human capacity for consumption is limited. The wealthiest man can only
eat and drink a certain amount; even his desire to possess fine
houses, clothes, pictures, motors, yachts and race-horses is liable to
satiation, and as labour and machinery advance in efficiency it
becomes more and more easily satiated. The result is that there is
more labour power in the world than the monopolists, the lords of
labour as well as of land, require to satisfy all their desires. The
labourer is not permitted to satisfy his own desires by consuming the
wealth he creates. Therefore he becomes superfluous and unemployed;
nobody wants the fruits of the work he could do; and we have in a
world of starving men and women the phenomenon to which bitter humour
gives the name over-production. Free Traders must allow the people
access to sources of wealth at home, if they expect the people to help
them in keeping the ports open to cargoes of wealth from abroad.
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