A Dialogue With Socialists on the Single Tax

Joseph Fels, et al.*

[What follows is a running exchange on The Single Tax between Joseph Fels, the editors and various socialist correspondents, reprinted from issues of the London-based Socialist publication, The New Age, from 1908 thru 1918]

The Single Tax and Socialism

H. Chomley and Joseph Fels / 17 December 1908, p.162.

Is there any good and sufficient reason why single taxers and Socialists should not work shoulder to shoulder in close alliance for that amelioration of social conditions -for that radical change in the basis of society which both feel is essential if this world is to become a fit place for the vast majority of its people to live in? Differ as they may concerning some of the means by which this bettering of conditions is to be accomplished, they agree as to others, and their ultimate aim is practically identical: namely, to make the mass of the people full participants in the vast wealth and the immense store of material advantages which the industrial forces of the world, rightly used, might produce.

It is true that the Socialist -- or so we understand the mailer -- regards the nationalisation of all means of production, distribution and exchange, as the only way towards the adequate socialisation of wealth, while the single taxer believes that such socialisation can be brought about by nationalising, through taxation, the land, and those things which arc in (heir nature monopolies. But this difference ought to count for little in the face of the wrongs and abuses which Socialists and single taxers agree should be attacked here and now. Two men who are travelling the same road, whereon enemies must be fought before progress can be made, would be foolish in refusing to join forces because one of them, after miles of the journey had been accomplished, intended to take a turning which the other believed would not lead to the objective which both had ultimately in view. Such travellers are the single taxer and the Socialist, and surely they should combine to fight their way along the first stages of their perilous economic journey.

In proof of our contention that their ultimate aim is practically indistinguishable, let us quote a portion of the passage from Progress and Poverty, in which Henry George points to the changes he desires to accomplish, and believes would result from the single tax :

"There would be a great and increasing surplus revenue from the taxation of land values, for material progress, which would go on with greatly accelerated rapidity, would tend constantly to increase rent. This revenue arising from the common property could be applied to the common benefit, as were the revenues of Sparta. We might not establish public tables - they would be unnecessary; but we could establish public baths, museums, libraries, gardens, lecture rooms, music and dancing halls, theatres, universities, technical schools, shooting galleries, playgrounds, gymnasiums, etc. Heat, light, and motive power, as well as water might be conducted through our streets at public expense; our roads be lined with fruit trees; discoverers and inventors rewarded, scientific investigations supported; and in a thousand ways the public revenues made to foster efforts for the public benefit. We should reach the ideal of the Socialist, but not through government repression. Government would change its character, and would become the administration of I great co-operative society. It would become merely the agency by which the common property was administered for the common benefit."

No Socialist, we take it, hopes, at least for a long time, to accomplish more than this. The question remains, is there anything in the present practical proposals of the single taxer which is either foreign to, or not directly tending towards, the Socialist's ideal?

The single taxer wishes to lax land values. This would take for the community a portion of the value which the community created. It would, in our view, do muck more, but looked at from (he point of view of the Socialist, it should be of the first importance, for it both reduces the value of the land, which he wishes ultimately to nationalise, and provides a fund for purchase, or redeeming bonds paid for the land, if he has purchase in view.

Again, the single taxer desires to nationalise, or municipalise, railways, tramways, gasworks, waterworks, canals, telegraphs, telephones, electric supply - all those undertakings, in fact, which can be exploited by the individual only when some special privilege is conferred upon him by the State. These are in their nature monopolies, and to monopolies of almost every kind in the hands of the individual the single taxer is a sworn foe. Such limited exceptions as copyright and patents are of small importance.

Admitting that the Socialist considers this programme insufficient, it surely, nevertheless, affords a basis for a working agreement which would occupy reforming energies for the present and years to come. The single taxer wishes to begin with an attack on land monopoly. Cannot the Socialist go with him there? No one has pointed out more forcibly than Karl Marx how potent an agent is land ownership in the enslavement of labour. Let us destroy such ownership, and take the next great step that may prove needful, when the ground is clear.

Private property in land cannot be abolished in a day, or in many years, without unwearied effort, but the lime is propitious for striking a telling blow. Government is in need of another 20,000,000 pounds to meet next year's demands on the revenue. A tax of 1d. on the capital value of land in the United Kingdom, which cannot be less than six thousand million pounds to-day, would supply the sum and about 5,000,000 pounds to spare.

Let wasteful expenditure be cut down, as it might and ought to be by many millions, and still social reformers would find plenty of use for the balance.

If space permitted, we could show how, besides raising revenue, this tax would do much greater things in forcing land into use, in town and country, which means employing men now unemployed, who in their turn would spend their wages in employing others. We could show how it would raise wages, by reducing the competition of men driven out of the country with workers in the towns; how it would reduce rents, by forcing owners of unoccupied land and houses to build and to secure tenants.

These things, however, Socialists know. What we would urge upon them is to put a tax upon land values in the forefront of their programme, to make it their political battle cry for the coming months, and to ask help of the hundreds and thousands of single taxers and land value taxers, who are scattered throughout the country. They would be surprised at the response. And if, when the first battle of the land is won, question arises whether Radical and Socialist forces can still advance together, at least they will understand one another's, objectives better, after being comrades in arms.

MR. FELS AND THE SINGLE TAX

Nelson Field / 23 May 1912 (p.93)

Sir, - It is about time that Mr. Fels was informed that the measure of his mind has been taken by Socialists; and they are no longer inclined to be taken in by him. Day in, day out, we hear of Mr. Fels popping a letter into this paper and inspiring an article in that, subsidising a land-taxing lecturer here and a land-taxing party there, and all with a single object, which he must be very insincere if he conceals from himself. That object is to free his own class - the class of industrial capitalists - from the incubus of rent. Oh, yes, we understand our Mr. Fels better perhaps than he understands himself. At present, industrial capitalists not only pay rent for their own premises, but they must pay (in wages) the rents of their employees. And to make bad worse, the rent thus extracted from them if spent by a class that despises them. But suppose the State should appropriate rent - a great deal of relief would come to Mr. Fels' caste in several ways. First, rent would probably be reduced, if not for employers for workmen - with the consequence that wanes might be reduced. Secondly, the Government would spend its revenue from rent in the form of large undertakings designed to provide still greater scope for capitalists. Thirdly, a Single-tax is obviously designed to save the necessity of other taxes. In other words, Mr. Fels would get a great relief! Go on, Mr. Fels, we know your little game ; but it won't wash.


Fairplay / 6 June 1912 (p.93)

As I am not a Single Taxer, I am not influenced by political motives in protesting against Mr. Field's unjustifiable attack. Nor does Mr. Fels stand in need of any defence from me. 1 am animated merely by a feeling of indignation at the injustice and unfairness oi this wanton attack^ 1 enclose card.

MR. FELS AND THE SINGLE TAX

Nelson Field / 6 June 1912 (p.143)

Sir, - For all I know to the contrary, Mr. Fels may be, as your correspondent, "Fairplay," affirms, the mildest- mannered man that ever proposed to enrich himself at somebody's else's expense; but King Charles I probably ran him very close, and even Mr. Fels' enemies - the opponents of his Single-tax proposals - are probably not without personal charm. But personal charm has nothing to do with economics, and Mr. Fels ought to know very well that the release of himself and his employees from the obligation of rack-rent and the diversion of economic rent to the State will actually enable him to increase his profits. Not only will his men's living minimum be reduced, consequent on the reduction of their rent, but all the philanthropic State undertakings, now in part paid for out of profits and wages, will be paid by the State out of rent. Should private capitalism therefore continue after the Single-tax is in operation - and Mr. Fels has never suggested that it should not - the whole benefits will fall to his class. The class of Rent will be abolished only to make even more room for Interest and Profit. That Mr. Fels does not expect personally to benefit during his lifetime by this reform I can easily believe. If members of the capitalist class were not individually prepared to be occasionally altruistic in the interests of their class, the class itself would soon cease to exist; there must be honour even among thieves.


Fair Play / 20 June 1912 (p.189)

Sir, - Mr. Nelson Field's opinion that the single tax will benefit the capitalistic class by reducing rent and augmenting interest and profits is a perfectly legitimate one. I have myself pointed out again and again the absurdity of endeavoring to solve the industrial problem by the simple application of Mr. Henry George's panacea, and have exposed his contradictory assertions that "rent is robbery" whilst "interest is natural and just." But when Mr. Field goes on to impute dishonourable motives to those who accept George's economic theories he is overstepping the bounds of decency. Your correspondent has deliberately slandered a man he does not even know, and after being told so by one who happens to know, he simply reiterates the slander without any excuse. It is not necessary to characterize such conduct as this. Mr. Fels is justified in treating such "canaille" with contempt.


Nelson Field / 27 June 1912 (p.213)

Sir, - The would-be chivalrous personal defence your correspondent "Fair Play" put up (or Mr. Fels led me to conclude at first that he was no other that Mr. Fels; but his statement last week that in his opinion the single tax would augment profits and interest makes my assumption impossible. The dilemma "Fair Play" is now in is clear; his friend Mr. Fels is spending money in propagating a proposal that will be to his own advantage, or, at least, to the advantage of his own profiteering business. Now, in what way, I should like to ask, does Mr. Fels differ in this from the American trust magnates who go into politics for the good of their business and even endow colleges to spread economic fallacies? In America such men, however affable their manners or apparently benevolent their actions, are described as "out for boodle." Yet "Fair Play" objects to my stating this of Mr. Fels, though he acknowledges that boodle in the long run will result to Mr. Fels' class. What has an economist to do with Mr. Fels' personal charm. The personal charm is not incompatible with the economic instinct to squeeze out of society more interest and profit and to name the process social reform. As a social reformer Mr. Fels is either intellectually stupid not to see what "Fair Play" and I see so clearly, or he is a shrewd, long-sighted business-man. If this is slander, every economist daily slanders his thousands.


Nelson Field / 4 July 1912 (p.239)

Sir, - That amiable and charming gentleman, Mr. Fels, whom your correspondent, "Fair Play," has known to his delight for twenty years, shows no sign of profiting by "Fair Play's" instructions in economics any more than by my "slanders " In the "Daily Herald" of Tuesday last Mr. Fels returns to his dead muttons like any vulture that has been momentarily scared off ; and, after the usual manner of modern disputants, repeats his original fallacies as if they had never been demonstrated to be such. Under the title of "What Can the Rich Man do?" Mr. Fels perfunctorily goes through a. list of obviously impossible charities which a sensible rich man, like himself, cannot patronise. Omitting, then, any charities or works of education or endowment that a rich man with brains and good intentions might support, Mr. Fels hastens to his appointed end of advocating the Single Tax. The real grievance of labour to-day, he maintains, is that there are not jobs enough to go round; and the reason of this is that land is held up from productive exploitation. Tax landlords, therefore, on the market value of their land, whether used or unused, and the latter variety will soon be brought into the market. Doubtless it may be by this means; but what is there to prevent the capitalist class, of which Mr. Fels is such an amiable member, from intensifying their monopoly of Capital and Raw Material? Obviously nothing. The class of Rent, in fact, is abolished only to swell the classes of Interest and Profits, And since the charming Mr. Fels belongs to one or both of these classes, his interest in the Single Tax is personal. What can the rich man do, therefore? He can employ his money in the propagation of reforms which will add to his own wealth. When Jews do this, Mr. Belloc cries aloud that England is being sold to the Israelites. But when an American does it, and does it so amiably and so charmingly - being an amiable and charming man and not one of those Jews - why, then "Fair Play," and doubtless others, join in excusing him and in accusing critics like myself of ''slander." Mr. Fels knows. better, however, than to complain of " slander" himself. Neither the Rothschilds nor he condescend to reply to criticisms to which there is no honourable answer.


The Editors / 18 June 1912 (p.267)

From an interview with Mr. Finney in the "Labour Leader," and from his election literature that we have seen, we conclude that Mr. Finney is a. moderate Liberal whereas Mr. Outhwaite is an advanced Radical. In the "Labour Leader" Mr. Finney informs us that he is in favour of a universal Minimum Wage Bill. So is Mr. Outhwaite. He favours likewise an Eight Hours Day. So does Mr. Outhwaite. He would nationalise the mines, etc. So would Mr. Outhwaite. Finally, he summed up his programme in a poster issued during the election to this effect: "Vote for Finney and better wages and regular work." But Mr. Outhwaite is not only in favour of the same things, he has a notion, though a bad one, of how to get them. He does not say: Vote for me, and then when you have returned four hundred more like me, we shall possibly be able to do something. No, he can say: Vote for me and strengthen the hands of Mr. Lloyd George, who is about to do these very things. In regard, therefore, not only to promises, but to the ability to carry them out, the Liberal candidate had the advantage over the Labour candidate. The latter, indeed, was in the anomalous situation of having, on behalf of Labour, to oppose the main constructive plank in Mr. Outhwaite's programme: the Single Tax. But if the Single Tax was to be opposed - and we all agree that it should be - all the rest of the social reform programme should be equally opposed. To our mind the Single Tax differs in no essential respect from the Minimum Wage, the Eight Hours Day, the Right to Work, and all his other mites of the cheese. It is even conceivably a means of financing these schemes at the expense of the landowner instead of at the expense of the capitalist. But as both alike live on Labour the difference in their effect on wages is the difference between two-and-six and half-a-crown. Like the barbarians, however, who cannot count, Mr. Finney put two-and-six on his programme, but he was shocked at the suggestion of half-a-crown. Thus he and his supporters have been made fools of by a party that, in the matter of social reform at any rate, can beat them even hollower than they are.

Views and Reviews

A.E.R. / 27 February 1913 (p.409)

I DO not intend to deal with the "lies beyond"; there are enough by the way. We know by past experience that, when the "manufacturers' party" deals with the land, it tempers injustice with hypocrisy. Cobden wrote to Mr. Peter Taylor, with reference to the agitation for the repeal of the Corn Laws: "We don't want the question to be argued, but to be taken up on the primitive grounds of right and justice. We don't wish it to be treated as a manufacturer's question, nor a capitalist's either; but as a bread tax that robs all the community for the clumsy expedient of putting a mere fraction of the booty into the pockets of the robbers." Yet it was a manufacturer's question, for, four days later, Cobden wrote: "Eighteen months ago the movement had its birth in the wrongs of a few manufacturers who were seeking to be relieved from injuries inflicted upon their own peculiar interests." These letters will be found in Dr. Garnett's "Life of W. T. Fox." It behoves us to remember these facts when we are asked to believe that Landlordism is the primal curse, and to ask ourselves what we have to gain by relieving the capitalist of all taxation, and raising the revenue of the country by a single tax on land values. A Chartist in the hungry 'forties said of the manufacturers: "And now they want to get the Corn Laws repealed -not for your benefit, but for their own. 'Cheap bread,' they cry; but they mean 'Vow wages.' Do not listen to their cant and humbug." We are now asked to believe that the Single Tax means cheap land for everybody, whereas it only means lower ground rents for manufacturers, with concomitant higher profits.

On the abstract grounds of right and justice, we have only to ask why the whole cost of the national services should be borne by only one section of the community to see the great injustice of the demand for the Single Tax. Landlords, after all, do no more damage to the working classes than do the manufacturers; and it must be admitted that the national services are at present performed more for the benefit of the manufacturers than of the landlords. We may grant that the private ownership of land does not ensure the most productive use of it; we may agree with Mr. Wedgwood that "the heavy rates upon houses, machinery, stabling, sheds, glass-houses, etc., the 50 per cent, exemption given to agricultural land, and the rebates on game-covers, are all a very definite discouragement of production, and a distinct encouragement to keep land vacant, or half-used, and cause a shortage in it." But who made agricultural production so unremunerative that a 50 per cent, exemption had to be granted? Who rushed the nation into the towns, and forced up rents by the simple process of massing people on comparatively small areas? Who but the manufacturers? Yet they now come to us, in the person of Mr. Wedgwood, and tell us that the road to freedom lies through agriculture, and that the only way to obtain the land for the people is to increase its cost by making it bear the whole taxation of the country.

It is argued by Mr. Wedgwood, as though he wished to demonstrate the vindictiveness that inspires the attack on landlords, that a tax on land cannot be shifted by the landlord on to the tenant. I care little for what the "most respected economists" may say; Michael Flurscheim, who devotes a chapter of his "Over-Production and Want" to the land question, talks common sense on this point. For the Single Tax, be it remembered, does not abolish the private ownership of land: its prime objective is to force land into productive use, and pay the whole cost of the national services. All the rebates and exemptions will be transferred to manufacture. Against the punitive intentions of the Single-Taxers, Flurscheim urges that, "though it is true that, as a rule, the landlord takes all he can extort from the tenant, this power of extortion depends in the last resort on the rent-paying power of the latter. Now, as any tax relief obtained by the tenant raises his rent-paying power, the landlord may certainly recoup, by a higher rent, any tax shifted on his shoulders from those of the tenant. If a tenant pays $300 rent and $50 taxes, and you make the landlord pay the $50 taxes, will not the rent rise to $350?

There is a statement made by Mr. Wedgwood himself that betrays the fallacy of his argument that the Single Tax will destroy the monopoly of the ownership of land. "Many of that minority," he says, "who exclusively possess the control of portions of the earth's surface, have not only occupied what will satisfy their own needs, but have also exercised their monopoly power of withholding from use, so as to keep other land vacant or half-used. They have no necessary inducement or need to do otherwise; and that it is actually done is shown by the fact that many country landlords get no more than 2 per cent, on the capital value of their land; thus proving that ownership, without even normal return, is all they want." If already landowners are content with 2 per cent., why should we suppose that they would resign their ownership, even if the 2 per cent, were denied them? It has already been predicted that England will gradually be turned into the pleasure domain of the world's aristocracy and plutocracy; and Flurscheim argues that the Single Tax could not prevent this conversion, "Suppose that, under the Single Tax," he says, "the Rothschilds and a few hundred other millionaires in England and America should share the whim of turning Great Britain into a deer-park, and British landlords should sell at reasonable figures because of the new tax, which destroys the selling value of their land. Under existing laws, what could prevent these men from having their will? Certainly not the land-value tax, even if it were as high as it would be were the present values taken as a basis of calculation, i.e., 200 million pounds a year. The income of Rockefeller and Carnegie alone is at present valued at 12 to 15 million pounds each; that of the Rothschild families is higher, and, without going any further, we have already obtained one-quarter of the yearly tax required. But how long would it be required? How long would there be a rental value of 200 million pounds in a depopulated England, in that magnificent new deer-park? That value would follow British enterprise wherever the evicted people went. The United States, Australia, New Zealand, Canada, South Africa, would see their land values rise as the British land values fell; and finally the 200 millions might be reduced to something like 5s. an acre, to 20 million pounds, or even less, a mere trifle for such magnates. That such an event is practically impossible is begging the question, because it is only saying in other words that the Single Tax is impossible."

Into Flurscheim's arguments for land nationalisation by purchase I cannot enter here; but enough has been said to show that, if land monopoly is the root of all evil, as Mr. Wedgwood argues, and I am willing to agree, the evil cannot be abolished by the Single Tax, which, at the best, could only exchange a small number of private owners for a large number, and, at the worst, would enable industrial capitalists to complete the ruin of England by purchasing the land at forced prices. Already, as Mr. Wedgwood shows, industrial capitalists are becoming landowners abroad; and the process may well be repeated here if the Single Tax be imposed on land. By the abolition of the landlord, the capitalist producer would be freed from the burden of monopoly rent; and the Single Tax would simplify for him the question of the charges on industry. But with capital and land in the hands of the same people, the workers of England would be as badly off as ever.

THE SINGLE TAX

M. Fairley / 13 March 1913 (p.462)

Sir, - As your review of "The Road to Freedom" is a criticism of the Single Tax, with a direct attack on the bona-fides of Single Taxers, perhaps you will allow me a few words in reply. While it is always useful to scrutinise carefully the motives of a party who bring forward a measure, the measure, nevertheless, stands on its own legs as a step towards justice or the reverse; in other words, the thing advocated has nothing whatever lo do with the advocate.

Who. for example, would delay the abolition of slavery (industrial or chattel) because it happened to be brought forward by a man or a party who were not always just in their dealings with their fellow-man?

The first effect of the Single Tax is seen in the answer to the question: What is the difference in position between a tenant who pays the economic rent of his holding to a landlord, who in turn hands it over to the State, and a landlord who pays the economic rent of his estate to the State? Answer: There is no difference.

The second effect is seen if we ash how the landlord is to pay the economic rent unless he works the land to the full. He is now merely a tenant of the State, and no tenant can afford to keep any but a very small fraction of his land idle - i.e., he must, like all other tenants, work his land to the full, it necessary getting others to help him. Should he be unable to get sufficient help, he will be laced with a forced sale, which will reduce the selling price to the vanishing point. Now, the worker has no interest in the selling price of land, but he must have the use of land or perish. He can now get the use of land on condition that he pays the economic rent to the State, which is all that is necessary to ensure that each man will get the full product of his own labour and that the community will get the reward of their communal labour, which is the economic rent or Single Tax.

In conclusion, the Single Taxers have a definite programme mapped out, and have now got in Australia and Canada small instalments of their reform actually carried out, often in the teeth of the opposition of capitalists and landlords. Here, in this country, we have strenuous opposition from manufacturers, landowners, and Socialists.

The workers are eagerly looking for light and lending. You have admitted that "land monopoly is the root of all evil." It is now up to the Socialists to formulate a definite programme and policy, with the means or method of carrying it out, with which they can appeal to the people for their judgment and support. Let them fail in this, and they fail to justify their existence as reformers. The time for ideals is past. What we want is something done.

THE SINGLE TAX

A.E.R. / 20 March 1913 (p.487)

Sir, - Mr. Fairley's letter has puzzled me. He tells me that, "while it is always useful to scrutinise carefully the motives of a party who bring forward a measure, the measure, nevertheless, stands on its own legs as a step towards justice or the reverse; in other words, the thing advocated has nothing whatever to do with the advocate." This is an astounding affirmation, so far as politics is concerned; for we know that the clearest and most determinate principle means different things to different people. The recent case of insurance against sickness is an example. Most doctors would hold that you could only insure people against sickness by keeping them in good health, and would argue that any scheme that made provision for perfunctory medical treatment of disease or disability was not really insurance. The mass of insured people would argue that any scheme that reduced their income during health to provide them with a still smaller income during sickness was not an insurance against sickness in any intelligible sense of the word. To Mr. Lloyd George, insurance against sickness means "nine-pence for fourpence," and a whole host of unimaginable and unrealisable blessings for the people. If "the thing advocated has nothing whatever to do with the advocate," considering the changeling nature of political propaganda and its results, I can only demand that each new advocate shall "table his Bill" before I pretend to know what he advocates.

Certainly, in the else of the Single Tax, some such precaution is needed, for it is argued both by Henry George and the Socialists that private property in land is the root of all our trouble. But the Single Tax, proposed by Henry George, would not abolish private property in land; the landlord would still be the landlord, and the user of the land would still have to bear all charges, including the Single Tax, laid on the land. That, I think, was sufficiently demonstrated by the passages I quoted from Flurscheim. But I am now asked; "What is the difference in position between a tenant who pays the economic rent of his holding to a landlord, who, in turn, hands it over to the State, and a landlord who pays the economic rent of his estate to the State?"; and I am told that there is no difference whatever. There is one important and fundamental difference between the two propositions, for the alternative assumes that Socialism has been established and that the land has been nationalised. As a matter of fact, neither of these things has happened in England, nor are they contemplated by the advocates of the Single Tax. The Single Tax is not proposed as a means to the abolition of private property in land (the Socialist solution), hut as a means of abolishing monopoly rents, which hit shopkeepers and manufacturers rather hardly.

I am next told that the landlord cannot pay the economic rent (although the Single Tax is not economic rent) unless he works his land (o the full. I quoted Mr. Wedgwood to show that the landlord cares more for possession than for profit, and that the Single Tax would not make him relinquish possession. I quoted Flurscheim to show that even the economic rent of land could be paid by the landlord, and still the land need not be worked to the full. I have the more pleasure in quoting the following extract from the "Daily Chronicle," March 12, 1913, because Mr. Fairley tells me that, in Canada, the Single Taxers have got a small instalment of their reform actually in practice. The "Daily Chronicle" says: "The Duke of Sutherland is one of those British landlords who are buying great stretches of land in Canada. He is, however, also selling some of his estates in this country, and just recently Mr. J. W. Stewart, a wealthy Scotsman, who emigrated to Canada, has bought over 50,000 acres of the Duke's Sutherland shire estates. . . . Mr. Stewart is, of course, acquiring the Sutherlandshire estates more or less as a luxury, while the Duke is buying land in Canada as an investment." The italics are mine. Mr. Stewart evidently does not believe that the Single Tax will he imposed on his estates in Sutherland, and evidently docs not intend to work his land to the full, for he has acquired them "more or less as a luxury." On the other hand, the Duke of Sutherland actually finds that Canada, where the Single Tax is already in operation to some extent, is a more desirable place for investment in land than England. I think that I need not argue abstract economic questions when a fact of this importance is to hand.

Mr. Fairley tells me that "the worker has no interest in the selling price of land." Flurscheim, referring to the working of the Ashbourne Acts, quotes from the "Times," January 28, 1890: "One tenant bought the farm he cultivated at £550, and soon sold it, subject to the repayment of this sum", for 970 pounds. Another farm bought for 538 pounds was sold, subject to the purchase money, for £1,280. One which had fetched £755 was sold by the fortunate tenant who obtained possession of it through the new law, subject to the purchase money, for £1,725.'' It is clear that, unless private property in land is abolished, the worker may have a considerable interest in the selling price of land; and as the Single Tax will not abolish private ownership, and will only be burdensome to working farmers, it will be the worker, not the large landowner, who "will be faced with a forced sale, which will reduce the selling price of land to the vanishing point," at which price the people who want land more or less as a luxury will be pleased to buy.

I am told that "it is now up to the Socialists to formulate a definite programme and policy, with the means or the method of carrying it out, with which they can appeal to the people for their judgment and support." Programmes and policies belong to political parties, and there is no political Socialist Party in England; so that Mr Fairley's demand falls on air. If Mr. Fairley wants to know the Socialist solution of the problem, he can read the book, by Alfred Russell Wallace, or the publications of the English Land Nationalisation Society, or the chapter on Land in Michael Flurscheim's "Over-production and Want." He may also be recommended to read the series of articles on Guild-Socialism now appearing in THE NEW AGE. If he really wants something done, and that something to be beneficial, I can only advise him to restrain his impatience and study a subject before he accepts a solution; and if "the time for ideals is past," as he says, to remember that the Single Tax is only an ideal, that it is not practical politics, that, if it ever becomes so in England, it will leave the land in private possession, and will add nothing to the welfare of the people. For it is, or should be, clear that taxation (whether single or multiple) by a capitalistic State is simply the means whereby that State is maintained; and if one set of monopolists uses the State for the destruction of another set of monopolists, the result is that monopoly becomes more monopolistic; and if monopoly is the evil, the last state is worse than the first.

SINGLE TAX

M. Fairley / 10 April 1913 (p.564)

Sir, - I heartily agree with Mr. A.E.R. that "the clearest and most determinate principle means different things to different people," and on this account only I Should like to answer his letter, as his idea of the Single Tax and the idea that Single Taxers have of that measure Seem to differ.

We say that (1) the rental value (or the annual value of the land taken independently of all improvements) is being created day by day by the presence and activity of those who work and is created by nothing else; (2) that those people have the sole right to take this value and to Spend it on their communal needs.

Ask, therefore, everyone who says that he owns a piece of land to state what its rental value is and to pay to the State that rental value, whether that land is used or unused. This we maintain is just and equitable. Now the only reason that this measure is called the Single Tax is that it would be collected by the same machinery as taxes are collected. But you can call it "The taking for the community of the Rent of the Land," if that title is more pleasing.

I would like now to note one or two minor points in your correspondent's letter which I think should be cleared up. He says, "The Single Tax is not economic rent." Quite so, but, as explained above, the Single Tax will take the economic rent which is the rent of a piece of land whether used or not.

Re Canada, I should, apparently, have explained that only in certain districts do we find an instalment of the Single Tax in force. In the State of Alberta all towns and over fifty rural municipalities levy their local rates on land values, i.e., they take a portion of the rental value for the communal needs. In Saskatchewan, the position is about the same; British Columbia are introducing the principle on a small scale at present, but will probably follow the lead of Alberta. Australia would require a page to itself. These facts should, I think, be known to every social reformer and stock taken of the facts as the movement grows. I have not been able to find out whether the Duke of Sutherland's estates come under the influence of this measure; it would be of equal interest to know what be thinks of it. We know what the late Duke of Argyll thought of Henry George's proposal. He said: "If all owners of land, great and small, might be robbed, and ought to be robbed of that which society had from time immemorial allowed them and encouraged them to acquire and call their own; if the thousands of men, women and children who directly and indirectly live on rent ... are all equally to be ruined by the confiscation of the fund on which they depend - are there not other funds which would be all swept into the Same net of envy and of violence?" The Duke bad no doubt about the effect of the Single Tax.

One other point. From the official tax on New York City, which I have before me, the valuators separate the land value from the value of improvements (stone and lime, furniture, jewels, etc.), although no land value tax is levied so far. Now in that city the capital land value stands at 1,000 million pounds sterling, and is 62.6 per cent, of the whole, leaving 37.4 per cent, representing capital value of labour products. In the light of this, your correspondent's estimate of the total land value of Great Britain at 200 million pounds per annum seems rather small, for 200 by 20 years gives only 4,000 million pounds capital value, or four times only that of the city of New York.

Space forbids going into the enormous mineral land values of this country, which ought to pay their full economic rent to the community.


A.E.R. / 10 April 1913 (p.564)

A.E.R. replies: - Mr. Fairley tells me that the Single Tax is a tax on rental value up to its limit as declared; I knew that. Mr. Wedgwood told me the same thing. But in what way is this proposal superior to the proposal for taxing incomes up to their limit as declared? In what way is the Single Tax superior to any other tax pushed to its extreme? Why not tax bachelors up to the whole of their income; why not tax bicycles, or gramophones, or motor cars, or musical comedies, up to the limit of their declared value? Is it not obvious that bachelors would be less able to marry than they now are, and that motor cars, etc., would either be double their present price, or would not be produced at all? The bachelors, like the land, could not escape the tax, except by suicide: the land cannot even commit suicide. But if land is unused, how can it have a rental value? The imposition of the Single Tax on unused land is not impossible ; nothing is impossible to vindictive people; but it would be absolutely unproductive of revenue. It is an axiom in a Free Trade country that we tax for revenue, and as unused land can yield up revenue, the Exchequer will not be replenished from this source. It a value is given to unused land by a Government vainer, and a tax levied on that value, then it is obvious that we are not taxing for revenue, but for some punitive purpose. If the idea is to force this land into use, then it may well be defeated by that passion for possession which Mr. Wedgwood mentioned, and which Alfred Russell Wallace has declared to be the characteristic of rich people. If the land is forced into use, is it not obvious that the user will pay the tax? If, at the present time, with a 50 per cent, remission on agricultural land, the farmer cannot get a living in this country, how much will agriculture be improved when the land has to bear all the Charges of the State? I do not deny, I never have denied, that the Single Tax is a fiscal proposal, and can be imposed like any other tax; what I deny is that its results will abolish the evils of land monopoly. Mr. Wedgwood argued that the Single Tax would improve agriculture, stop the harmful growth of industrialism, raise wages, and free the workers from all monopolists. I have given my reasons for supposing that it will do nothing of the sort, that, on the contrary, at its best it will only simplify the incidence of taxation; at its worst, it will unify the monopolies of land and capital. If Mr. Fairley wants to ignore my arguments, he may; but he cannot expect me to continue the discussion. I do not intend to repeat what I have said; I cannot quote in your pages the whole of Flurscheim's arguments against the Single Tax, nor can 1 reprint the book by Alfred Russel Wallace. If Mr. Fairley will not read for himself: he must remain a Single-Taxer; I have nothing more to say to him.

SINGLE TAX AND PROFITEERING

Joseph Fels / 11 September 1913 (p.582)

Sir, - Your Open Letter addressed to the Trades Union Congress emphasises the importance of the figures provided by the recent Board of Trade inquiry into working-class rents and retail prices. You conclude that, because prices have advanced 13.7 per cent., while rents of dwellings have advanced only 1.8 per cent., therefore the real enemy is what you call the "profiteer" and not the landlord.

If you claim that the Board of Trade inquiry proves the absolute gain to the landlords to have been only 1.8 per cent., and that "manufacturers are extorting more than landlords" out of the workers, I think you arrive swiftly at most absurd conclusions. For what you say regarding the difference between money wages and "real" wages must be true also of money profits and rents and "real" profits and rents. In each case the " real " income is not the money received, but the goods that can be purchased with such money.

The Board of Trade inquiry includes the prices of beef, mutton, pork, tea, sugar, bacon, cheese, butter, potatoes, flour, bread, milk, and coal. These goods are purchased not only by the money received by the wage earner. They are also purchased by the money received by the landlord and by the money received by the " profiteer."

Now, if you contend that the landlord-robber has succeeded in increasing his extortion by only 1.8 per cent., despite Single Tax accusations of "rapacity," his gain must likewise be offset by the rise in prices. With his rent increased by 1.8 per cent., he has to pay 13.7 per cent, more for all the goods I have enumerated above, and on the average his " real " rent has actually diminished, just as "real " wages have diminished.

Applying this same strange argument of yours to the case of the " profiteer," it is apparent his benefit has been more imaginary than real. He has had to pay increased money wages varying from 1.9 per cent, for skilled builders to 4.1 per cent, for compositors. But he does not sell all the goods catalogued in the Board of Trade inquiry. Many "profiteers" sell none of them. At the best, the "profiteer " sells only a few, and for these he receives prices increased by 13.7 per cent., but he has to purchase all the rest and pay 13.7 per cent, more for them. Therefore, on your own showing, and making the same use as you do of the Board of Trade figures, his "real" profits have been considerably diminished. One "profiteer" has blackmailed and robbed another, and your contention that either landowner or "profiteer" has been enriched is flatly denied.

It should occur to you that there is a fallacy in considering that the rent paid by wage-earners for house room, after receiving their wages, is the only payment landlords extort from them and from the results of their labour. Yet that is the basis of your whole argument, and it is your reason for rejecting the assurances of the "satellites of the manufacturing employer" that the cause of the increased cost of living is landlordism.

Yon define wages as "the price paid in the competitive market for labour as a commodity." This is not a definition, for it does not include the considerable number of workers whose earnings are no greater than those of "factory hands" and who are not in the pay of any employer. But however wages may be defined, there is no disputing the fact that they are that part of the total wealth produced from year to year which is received by wealth producers, whether in the pay of employers or not. True, they are only a small part, and the distribution of wealth is unequal and unjust; but who gets the balance not received by wage-earners? You will not maintain it is all collared in " profits" by the so-called "profiteer." You yourself distinguish, when pointing the finger of scorn at the "Single Taxer," between the "profiteer" and the landlord, although in other parts of your Open Letter the distinction between the owner of plant, machinery, and buildings, and the owner of land is more obscure. You will not maintain that the landowner gets no part of the surplus which is not received by wage-earners, for you must grant that a large part of this surplus is secured by landowners as tribute for the permission to use the earth.

No "profiteer" has yet been able to exploit a landowner. It is the landowner who exploits the "profiteer," and he can screw up his tribute to the highest point any industry can bear by keeping his hold on the monopoly of land, and allowing only some sites and some areas to be used.

It is after the landowner has received this tribute, after rates and taxes have been paid for the sin of erecting buildings or installing machinery, after every effort is made to pass on these burdens to the consumer, that wages are paid. The produce of the factory, mine, or farm must provide the incomes of all and the revenue of the State. The community as a whole is robbed by the landowner, even though the so-called "profiteer" acts as go-between and pays the rent.

If by "profiteer" you mean anyone and everyone who employs a fellow-being, your quarrel cannot be with the "profiteer" as such. For great numbers of employers are scarcely better off than those whom they employ. They live from hand to mouth, have no special privileges, no monopoly, and no patent rights. Your quarrel manifestly is with a particular kind of "profiteer," especially the " great employing manufacturer "or the "large capitalist," who can generally afford to look on while other men do the work. The vice of the argument is that you do not distinguish among the "profiteers" who own (a) only buildings, plant, or machinery, (b) only land, (c) both land and buildings, plant or machinery. Most "large capitalists" belong to the third class. Part of their assets consists in land and a corresponding part of their profits is pure rent of land. Cement firms and salt firms, for instance, generally take good care to own the deposits of raw material upon which their industry is based, while landless labourers, deprived of all rights to these or any other natural resources, beg at the factory gates for the privilege of a job.

You quite rightly insist upon the great increase in the production of wealth, which is, as you state, proved by every test; but I repeat, you have to point the moral by showing who has pocketed the increase. You cannot use the term "profiteer," for it is abundantly clear that this term is a confusion. The balance, except for what is paid strictly in salaries and such peculiar payments as patent royalties, has been divided between interest and rent -interest upon stock-in-trade, buildings, plant, and machinery, and rent of land. But as stock-in-trade, buildings, plant, and machinery are being constantly reproduced, and as the owners of these things are constantly competing with one another, they cannot claim anything but the market rate of interest.

But land is not reproduced. It is limited absolutely in area. It is the essential condition of all existence. Its owners charge tribute for its use without giving anything whatever in return, or pocket a large part of the produce as rent and call it profits on their "investment." The more that can be produced on land, the greater is the tribute, so long as the monopoly is maintained - and repeated illustrations prove to the hilt how effectively both the dreadful "capitalist" and the common labourer can be "exploited" in this way.

The increased production has gone in rent. But you would disguise this fact with obvious confusions in terms. You would practise deception in trying to persuade the workers, on the authority of a Blue Book that proves nothing of the kind, that the landlord receives nothing but the few shillings a week paid by each wage earner for house room. When yon discuss your final proposals for abolishing the "bondage of wagery," you sink the landlord out of sight and advocate "a reasonable annuity for two generations to the owners of plant and machinery." Are your readers to gather that a "reasonable annuity" is also your method of dispensing compensation to landowners? If not, what do you propose to do in regard to the rent now paid for laud, and also in regard to the value of land for which no rent is paid because it is held out of use?

There are several considerations in regard to labour and wages I wish you to look at. Firstly, labourers are employed by other labourers. The producer of boots is employed by the wearer of boots, who in return produces bread or furniture or clothes. If producers of bread are prevented from producing, there is correspondingly less employment for the makers of boots and vice versa. The real employer of the bus driver is not the bus company, but the people who ride in buses. Every employed man makes a demand for the goods produced or services provided by other employed men.

Secondly, the general level of wages can never be more than the earnings men can get in the least productive occupation or on the least productive land. The condition of the man on the "margin," as both Mr. Shaw and Mr. Webb have shown, determines the condition of men in all other employments. The wage-earner will get the same wages whether he is employed by the greatest capitalistic concern or by the humblest and most self-sacrificing shopkeeper in a back street. So that, although wages are "a price paid for a commodity," they are not less than what wage earners can get in the least productive employment.

Thirdly, labourers, as you say, are too plentiful. But plentiful in relation to what? Certainly not in relation to the fund in the possession of the "profiteer," which is apparently your meaning - an implicit statement of the wage fund theory that wages are determined by the amount of capital that could be devoted to the employment of labourers. In obedience to that theory, you would "capture" all capital for the guilds, and thus make labour the master of the situation. But the theory was blown sky-high thirty years ago by Henry George, who demonstrated that wages are determined by the number of labourers seeking employment in relation to the number of available natural opportunities open to labour. It is only if these natural opportunities are scarce that labour will be "plentiful" and will find difficulty in securing employment. And as everyone has an equal right to the use of natural opportunities, the proper course is to destroy monopoly in them by obliging every holder to pay their annual value to the rest of the community.

That means the taxation and rating of land values, for every "natural opportunity" is laud in some form or other, whether it is the site of a house, an area suitable for a farm, coal deposits, slate quarries, or river water. The value of land represents the wealth which belongs to the community as a whole, and in appropriating it for the community we would not only "pool" this wealth, but we would force monopolists to let go the land they hold out of use, and thus multiply the available natural opportunities. It is only by giving each man an equal right "margin," all the surplus wealth which is produced on superior sites and soils being pooled for common benefit. In other words, there are more labourers to-day than there are opportunities for employment. The taxation of land values would, we insist, annex the wealth that belongs to all, expel the land speculator, and open to labour the limitless opportunities in town and country which Nature provides. This would make opportunities more plentiful than labourers, and raise wages, just as existing conditions of monopoly in these opportunities restrict employment and force wages to subsistence level with each labourer's effective demand for goods correspondingly curtailed.


Editors / 11 September 1913 (p.581-582)

[We willingly reply in some detail to this letter, although we know that Mr. Fels is a fanatic upon the subject. We will, however, assume that he is amenable to reason.]

It is primarily necessary to impress upon Mr. Fels the fact, well known to our regular readers, that we have no more feeling of sympathy for the landlords than for the profiteers. Both in their own way (which in the final analysis is very much the same' way) exploit labour. Mr. Fels complains that our distinction between rent and interest tends to become obscure. It is not for us to draw fine distinctions between the two. As a Single Taxer, Mr. Fels is penetrated with the belief that there are fundamental distinctions between the functions of the profiteering and land-owning classes. We do not deny that a profiteer, functioning as an administrator, differs in economic significance from a landlord who lives solely upon rent. But it is the same distinction on the other foot when we have a landlord functioning as an administrator compared with a profiteer who lives solely upon profits. The effects of the exploitation of labour by landlord and profiteer are precisely the same, so far as the wage slave is concerned. The French with logical clearness decline to make the distinction. A "rentier " draws his income from "rentes," precisely as he draws it from rent. Mr. Fels, not being a regular reader of THE NEW AGE (a moral lapse which we trust he will rectify), assumes that our whole attack is upon the profiteer. Accordingly he asks whether we are prepared to mete out the same justice to landlords as to profiteers when we advocate "a reasonable annuity for two generations." Of course we are. It shocks us to discover that Mr. Fels should have any doubt about it. But in the struggle to abolish wagery (the continuance of which Mr. Fels complacently accepts) we have deemed it wise to preserve a sense of proportion. If the profiteers exploit labour to a greater extent than do the landlords, then palpably the profiteer is the more serious enemy of the two. That was the point of our remark that drew this reply from Mr. Fels, who believes that the imposition of a single tax upon the land values "would annex the wealth that belongs to all, expel the land speculator, and open to labour the limitless opportunities in town and country which Nature provides. This would make opportunities more plentiful than labourers and raise wages." Mr. Fels, in short, invites us to leave the profiteer alone and concentrate our attack upon the landlord. But he admits that, after the Single Tax had done its deadly work, the wage system would continue. As the wage system is equally fundamental to the existence of both landlord and profiteer, and as we desire the destruction of wagery, we are not so foolish as to make flesh of the profiteer and fowl of the landlord. Both separately and in alliance they exploit labour by maintaining the wage system. So far as Mr. Fels believes in the continuance of wagery, he writes himself down an enemy of labour, and so clouds with suspicion his personally well-intentioned attack upon the landlords. We are therefore fully justified in warning the trade unionists against his particular propaganda. His letter completely proves the wisdom of our remark. Mr. Fels can only come into court with clean hands when he frankly accepts the justice and policy of wage abolition.

Before touching upon some of the details in his letter, we must remind Mr. Fels that the new conception of society from which wages are eliminated necessarily transforms the meaning of many economic terms. For example, to the wage earner, rent, interest, and profits connote the economic power which the possessing classes exercise upon the proletariat. The deduction (adumbrated by Ricardo) is this : rent is in reality the economic power that one man or class exercises upon another. Thus a man with £100 in gold at the bank rents it out for £5 perr annum. Another man with land valued at £100 rents it out at £5 per annum. The economic effect is precisely the same in both instances. Both, in fact, exact rent. The Single Taxers seem to think that the £5 exacted in the form of interest smells differently from the £5 exacted as rent. Our sense of smell, aided by reason and instinct, rejects any such theory. And in abstract justice we cannot morally distinguish between the two transactions.

There are some statements of fact in Mr. Fels' letter that call for comment. He quite rightly points out that the increase in rent of 1.8 per cent, must be offset by the advance in prices of 13.7 per cent. Therefore "real" rent has diminished. We believe this to be absolutely the fact, but how it helps Mr. Fels we are at a loss to understand. The landlord, certainly in all large transactions, rents his land on lease. If the cost of living advances, he cannot raise his rent. But the profiteer can, in association with his commercial colleagues, raise his prices once a month or once a year. To him it is largely a question of associated effort. If, then, "real" rents have actually diminished and "real" wages have fallen, somebody has run off with the plunder. We assert that it is the profiteers, whose income as a class has steadily risen in recent years up to 22% per cent. Granting the 13.7 per cent, advance in the cost of living, this gives the profiteering class a net advance of 9 per cent., which is precisely the percentage of the fall in real wages. Why, then, should we point our guns only at the landlords, when obviously the profiteers have the heaviest artillery? Mr. Fels cries mercy for the profiteers because they apparently blackmail and rob each other. No doubt they do; but profiteers of every denomination, in happy unity with the landlords, are all agreed that they must maintain the wage system so that they may exploit labour. Mr. Fels is in that galley. If we can sink it, he, too, will go down. At the Judgment Day he will get short shrift if he contends that we ought first to have sunk some other galley in the same fleet.

The truth, however, is that Mr. Fels does not know the true meaning of wages. He rejects one definition because "it does not include the considerable number of workers whose earnings are no greater than those of 'factory hands' and who are not in the pay of any employer." The simple answer, of course, is that they do not receive wages - the small shopkeeper, for example. But it is not our definition; it is the classical definition from Adam Smith to Marx. The term "wage" has a distinct and well-understood meaning, and Mr. Fels must accept it if he would publicly discuss any subject in which the wage system is included.

It is this inability on the part of Mr. Fels to appreciate the exact meaning of wages that leads him into another extraordinary blunder. He quite truly asserts that many profiteers are scarcely better off than those they employ. Therefore, he argues, "your quarrel manifestly is with a particular kind of profiteer, especially the great employing manufacturer or the large capitalist." Nothing we have written gives Mr. Fels any sanction for such a statement. Our quarrel is not with the individual profiteers, whether great or small, but with the system. The system permits every class and kind and degree of profiteer to buy labour as a commodity at a competitive price finally based on the subsistence level. Between the price paid for the labour commodity plus the price of the other raw material and the selling price of the finished product, landlord and profiteer are provided for. We tell the wage earner so to organize that he shall possess a monopoly of labour power, then to decline to sell his labour as a commodity and at all costs to retain his right (i.e., his economic power) in the product created by his labour. By organising himself into appropriate guilds he can thereby squeeze out rent, interest, and profits. In this squeezing-out process, both landlords and profiteers will be heard squealing. Which squeals first is only of academic interest to us. The purchase of labour as a commodity for exploitation is a sin and an abomination, not to be distinguished from chattel slavery. The Single Taxers do not appear to realise this, and are accordingly guilty of moral obtuseness.

Mr. Fels, for some reason we cannot grasp, next remarks that we implicitly accept the wage-fund theory. As Marx smashed the wage-fund theory a generation ago, and as our definition of wages has literally nothing whatever to do with this dead theory, and as, incidentally, we killed the theory ourselves in our series on the Wage-System, we appeal to Mr. Fels to believe that we are not utter ignoramuses. We solemnly assure him that Jeremy Bentham was dead before we were born.

The exact politico-economic situation that would be created by the successful imposition of the single-tax would be simply this: the profiteers would possess their present economic power plus the security of tenure they would obtain from State-rented land. As economic power precedes political power, they would be enabled to reduce or increase rents precisely as it suited their purposes. Rent, in the ordinary acceptation of the word to the profiteer, is a subsidiary, indeed almost a. negligible consideration. Mr. Fels thinks land would become so accessible to labour that the labourer would find available "natural opportunities," and so be able to secure higher wages. He bases this conclusion, so far as we can gather, on the assumption that whereas "buildings, plant, and machinery are being constantly reproduced" (therefore requiring large command of capital) "land is not reproduced." Therefore the ordinary capitalistic processes do not operate in agriculture, and accordingly, free access to the land spells freedom from capitalistic oppression. As a matter of fact, so long as wagery is the foundation of our industrial system, capitalistic processes are as necessary to agriculture as to industry. Economically considered land does reproduce itself. If it does not, how does it "run down"? If it does not, why the necessity for periodic fallow? If it does not, why have 250,000 farmers left the Middle West and migrated to Canada? Has Mr. Fels ever heard of manure? We are really forced to the conclusion that when the single-taxers discuss land they are all as mad as March hare.