This is part of a series
After Nestor: Land, Rent, and the State
Tucker squares off with a land-taxing Georgist reader whose preoccupation with land distracts him from the larger war against Archism.
Instead of a Book, By a Man Too Busy to Write One
Part Four: Land and Rent
A Criticism That Does Not Apply.
(published in Liberty on July 16, 1887)
To the Editor of Liberty:
It pains me to see your frequent attacks on Henry George, as they make the defenders of monopolies secure in the knowledge that there is discord in the ranks of the reformers. It appears to me—though I may be mistaken and will gladly accept arguments and refutation—that one important point of the land question has escaped your attention, just as the vital point of the money question does not seem to be clear to the editor of the Standard. It is my conviction that in a state of perfect liberty, assuming the existence of “intelligent egoism,” the people will combine for mutual protection, and among other things will enter a social compact creating an equitable right of property. They will also protect their members in the possession of the land they till, or on which they ply their trade or build their homes. But since some land possesses advantages over other land, they will demand an equitable remuneration for this protection and renunciation, especially if it can be shown to cost the consumers of whatever is produced under these special advantages exactly as much as the holder of land is able to obtain as “rent” (Ricardo’s “rent,” John Stuart Mill’s “unearned increment”). The community would therefore collect the rent in the form of taxes,—i.e., equitable pay for the right of possession,—and, to be perfectly fair, should divide the proceeds among those consumers who, through the operation of the law of supply and demand, were forced to pay more than the average cost. But as such distribution would be practically impossible, the proceeds of this taxation should be used as nearly as possible to the advantage of those to whom it equitably belongs. Can you suggest a better disposal than Henry George does? If so, we are ready to hear. But please admit, or else refute, the statement that the collection of rent by the community would be the natural outgrowth of equitable social compact entered for the sake of order and peace in a state of perfect liberty among intelligently egoistical beings.
You cannot convince Henry George of the error of his position in relation to capital, if you deride the truths he advances together with his errors. Let us reason together, and I am sure we can ultimately unite on one platform,—i.e., the abolition of all unjust laws, of which the permission given to individual persons of appropriating the unearned increment (which has a natural, not an artificial, origin) is not by any means the least.
Philadelphia, May 11, 1887
My correspondent, who, by the way, is a highly intelligent man, and has a most clear understanding of the money question, should point out the truths that I have derided before accusing me of deriding any. I certainly never have derided the truth contained in Ricardo’s theory of rent. What I have derided is Henry George’s proposal that a majority of the people shall seize this rent by force and expend it for their own benefit, or perhaps for what they are pleased to consider the benefit of the minority. I have also derided many of the arguments by which Mr. George has attempted to justify this proposal, many of which he has used in favor of interest and other forms of robbery, and his ridiculous pretence that he is a champion of liberty. But I have never disputed that, under the system of land monopoly, certain individuals get, in the form of rent, a great deal that they never earned by their labor, or that it would be a great blessing if some plan should be devised and adopted whereby this could be prevented without violating the liberty of the individual. I am convinced, however, that the abolition of the money monopoly, and the refusal of protection to all land titles except those of occupiers, would, by the emancipation of the workingman from his present slavery to capital, reduce this evil to a very small fraction of its present proportions, especially in cities, and that the remaining fraction would be the cause of no more inequality than arises from the unearned increment derived by almost every industry from the aggregation of people or from that unearned increment of superior natural ability which, even under the operation of the cost principle, will probably always enable some individuals to get higher wages than the average rate. In all these cases the margin of difference will tend steadily to decrease, but it is not likely in any of them to disappear altogether. Whether, after the abolition of the state, voluntary co-operators will resort to communistic methods in the hope of banishing even these vestiges of inequality is a question for their own future consideration, and has nothing whatever to do with the scheme of Henry George. For my part, I should be inclined to regard such a course as a leap not from the frying-pan into the fire, but from a Turkish bath into the nethermost hell. I take no pleasure in attacking Mr. George, but shall probably pursue my present policy until he condescends to answer and refute my arguments, if he can, or gives some satisfactory reason for declining to do so.
(published in Liberty on October 13, 1888)
To the Editor of Liberty:
You have more than once expressed the view that in an Anarchistic state even the police protection may be in private hands and subject to competition, so that whoever needs protection may hire it from whichever person or company he chooses. Now, suppose two men wish to occupy the same piece of land and appeal to rival companies for protection. What will be the result?
It appears to me that there will be interminable contention as long as there is a plurality of protectors upon the same territory, and that ultimately all others must submit to, or be absorbed by, one, to which all who need protection must apply. If I am right, then Anarchy is impossible, and an equitable democratic government the only stable form of society. Moreover, as it can be shown that the value of the protection to the possession of land equals its economic rent, free competition will make the payment of this rent a condition of protection. Thus the payment of rent would become an essential feature in the contract between the landholder and the government,—in other words, the payment of rent to the people as a whole will become one of the features of that social system of an intelligent people which must evolve from anarchy by the process of natural selection.
Under the influence of competition the best and cheapest protector, like the best and cheapest tailor, would doubtless get the greater part of the business. It is conceivable even that he might get the whole of it. But if he should, it would be by his virtue as a protector, not by his power as a tyrant. He would be kept at his best by the possibility of competition and the fear of it; and the source of power would always remain, not with him, but with his patrons, who would exercise it, not by voting him down or by forcibly putting another in his place, but by withdrawing their patronage. Such a state of things, far from showing the impossibility of Anarchy, would be Anarchy itself, and would have little or nothing in common with what now goes by the name of “equitable democratic government.”
If “it can be shown that the value of the protection to the possession of land equals its economic rent,” the demonstration will be interesting. To me it seems that the measure of such value must often include many other factors than economic rent. A man may own a home the economic rent of which is zero, but to which he is deeply attached by many tender memories. Is the value of protection in his possession of that home zero? But perhaps Egoist means the exchange value of protection. If so, I answer that, under free competition, the exchange value of protection, like the exchange value of everything else, would be its cost, which might in any given case be more or less than the economic rent. The condition of receiving protection would be the same as the condition of receiving beefsteak,—namely, ability and willingness to pay the cost thereof.
If I am right, the payment of rent, then, would not be an essential feature in the contract between the landholder and the protector. It is conceivable, however, though in my judgment unlikely, that it might be found an advantageous feature. If so, protectors adopting that form of contract would distance their competitors. But if one of these protectors should ever say to landholders: “Sign this contract; if you do not, I not only will refuse you protection, but I will myself invade you and annually confiscate a portion of your earnings equal to the economic rent of your land,” I incline to the opinion that “intelligent people” would sooner or later, “by the process of natural selection,” evolve into Anarchy by rallying around these landholders for the formation of a new social and protective system, which would subordinate the pooling of economic rents to the security of each individual in the possession of the raw materials which he uses and the disposition of the wealth which he thereby produces.
Protection, and Its Relation to Rent.
(published in Liberty on October 27, 1888)
To the Editor of Liberty:
Referring to your favored reply of October 13, I fail to find an answer to the question as to the result of the attempt of two rival protectors to secure to different persons the same territory. I cannot see how, under such conditions, a physical conflict can be avoided, (1) nor is it clear why the best and cheapest protector will be the most patronized if he is not at the same time the strongest. It would be the power rather than the quality of protection that would secure patronage. (2) But if the tyrant by sophistry could convince the masses, as he now does, that his policy is to their benefit and could obtain their support, Anarchy would inevitably lead to despotism. (3) The present State, to my mind, is indeed the natural outgrowth of Anarchy, its absurd character, being due to shortsighted intelligence and sustained by a copious amount of sophistry. (4)
My remarks about equity do certainly not refer to what is now termed equity, but to the genuine article.
The statement that the value of the protection in the possession of land equals its economic rent I consider true, even if there is no direct labor of protection involved.
By rent I mean, of course, that which Ricardo terms rent,—i.e., the difference between the productivity of a particular piece of land and the marginal productivity; the excess of the value of a product over the value of the labor producing it.
The observation regarding the sentimental value of protection is certainly out of place, since in economic discussion none other than exchange value can be considered. (5) Even in a society in which the policeman is superfluous, the value of protection in the possession of land can be shown to be equal to its economic rent. The right of possession to land consists in an agreement of the people to forego the special advantages which the use of land affords to an undisturbed possessor. It represents a giving-up, by the community, of that which they could obtain for themselves,—the cost of the community being certainly that which they have relinquished, and equals in value the special advantage which is the cause of rent. In view of this, it seems to me that affording this protection is to the community an expense equal to the rent. (6) Moreover, assuming that owing to the favorable locality or fertility (eliminating a difference of skill or other merit) the production on that land of one year’s labor (say three hundred days) will exchange for five hundred days’ of other men’s labor who must work without such special advantages, it will be difficult to show that the occupier of that land is equitably entitled to this exchange value. (7)Those who buy his products really produce and actually pay the excess of two hundred days’ labor. Are they not entitled to a distribution of this rent which they, in the course of exchange, have paid to him? If the people of a community are endowed with intelligent egoism, they cannot give that protection to any one who is not willing to pay the rent; and, if the occupier refuses to do so, the right of occupation will simply be given to one who is willing. (8) This is no invasion, but a bargain. (9) What right has he to expect the community to secure him an opportunity to make inequitable exchanges, (10) when others are willing to pay the full value of the advantages offered, whereby equity is established? I can conceive of no other individualistic measure (11) by which the cost principle of value can be realized in those cases in which the cost of producing equal quantities is different on account of a variation of local opportunities than to add rent to the cost where the immediate cost is naturally less than the value of the product. All men are then upon an equitable plane regarding the gifts of nature; and none can, as none should in this respect, have an advantage that is not similarly enjoyed by all. (12)
(1) A physical conflict may or may not occur. The probability of it is inversely proportional to the amount of education in economics and social science acquired by the people prior to the inauguration of the conditions supposed. If government should be abruptly and entirely abolished to-morrow, there would probably ensue a series of physical conflicts about land and many other things, ending in reaction and a revival of the old tyranny. But if the abolition of government shall take place gradually, beginning with the downfall of the money and land monopolies and extending thence into one field after another, it will be accompanied by such a constant acquisition and steady spreading of social truth that, when the time shall come to apply the voluntary principle in the supply of police protection, the people will rally as promptly and universally to the support of the protector who acts most nearly in accordance with the principles of social science as they now rally to the side of the assaulted man against his would-be murderer. In that case no serious conflict can arise.
(2) Egoist neglects to consider my statement in reply to him in the last issue of Liberty, to the effect that the source of the protector’s power lies precisely in the patronage. The protector who is most patronized will, therefore, be the strongest; and the people will endow with their power the protector who is best fitted to use it in the administration of justice.
(3) That is to say, if the masses, or any large section of them, after having come to an understanding and acceptance of Anarchism, should then be induced by the sophistry of tyrants to reject it again, despotism would result. This is perfectly true. No Anarchist ever dreamed of denying it. Indeed, the Anarchist’s only hope lies in his confidence that people who have once intelligently accepted his principle will “stay put.”
(4) The present State cannot be an outgrowth of Anarchy, because Anarchy, in the philosophical sense of the word, has never existed. For Anarchy, after all, means something more than the possession of liberty. Just as Ruskin defines wealth as “the possession of the valuable by the valiant,” so Anarchy may be defined as the possession of liberty by libertarians,—that is, by those who know what liberty means. The barbaric liberty out of which the present State developed was not Anarchy in this sense at all, for those who possessed it had not the slightest conception of its blessings or of the line that divides it from tyranny.
(5) Nothing can have value in the absence of demand for it. Therefore the basis of the demand cannot be irrelevant in considering value. Now, it is manifest that the demand for protection in the possession of land does not rest solely upon excess of fertility or commercial advantage of situation. On the contrary, it rests, in an ever-rising degree and among an ever-increasing proportion of the people, upon the love of security and peace, the love of home, the love of beautiful scenery, and many other wholly sentimental motives. Inasmuch, then, as the strength of some of the motives for the demand of protection bears often no relation to economic rent, the value of such protection is not necessarily equal to economic rent. Which is the contrary of Egoist’s proposition.
(6) All this legitimately follows, once having admitted Egoist’s definition of the right of possession of land. But that definition rests on an assumption which Anarchists deny,—namely, that there is an entity known as the community which is the rightful owner of all land. Here we touch the central point of the discussion. Here I take issue with Egoist, and maintain that the community is a nonentity, that it has no existence, and that what is called “the community” is simply a combination of individuals having no prerogatives beyond those of the individuals themselves. This combination of individuals has no better title to the land than any single individual outside of it; and the argument which Egoist uses in behalf of the community this outside individual, if he but had the strength to back it up, might cite with equal propriety in his own behalf. He might say: “The right of possession of land consists in an agreement on my part to forego the special advantages which the use of such land affords to an undisturbed possessor. It represents a giving-up, by me, of that which I could obtain for myself,—the cost to me being certainly that which I have relinquished, and equals in value the special advantage which is the cause of rent. In view of this, it seems to me that affording this protection is to me an expense equal to the rent.” And thereupon he might proceed to collect this rent from the community as compensation for the protection which he afforded it in allowing it to occupy the land. But in his case the supposed condition is lacking; he has not the strength necessary to enforce such an argument as this. The community, or combination of individuals, has this strength. Its only superiority to the single individual, then, in relation to the land, consists in the right of the strongest,—a perfectly valid right, I admit, but one which, if exercised, leads to serious results. If the community proposes to exercise its right of the strongest, why stop with the collection of economic rent? Why not make the individual its slave outright? Why not strip him of everything but the bare necessities of life? Why recognize him at all, in any way, except as a tool to be used in the interest of the community? In a word, why not do precisely what capitalism is doing now, or else what State Socialism proposes to do when it gets control of affairs? But if the community does not propose to go to this extreme; if it proposes to recognize the individual and treat with him,—then it must forego entirely its right of the strongest, and be ready to contract on a basis of equality of rights, by which the individual’s title to the land he uses and to what he gets out of it shall be held valid as against the world. Then, if the individual consents to pool his rent with others, well and good; but, if not—why, then, he must be left alone. And it will not do for the community to turn upon him and demand the economic rent of his land as compensation for the “protection” which it affords him in thus letting him alone. As well might the burglar say to the householder: “Here, I can, if I choose, enter your house one of these fine nights and carry off your valuables; I therefore demand that you immediately hand them over to me as compensation for the sacrifice which I make and the protection which I afford you in not doing so.”
(7) Precisely as difficult as it would be to show that the man of superior skill (native, not acquired) who produces in the ratio of five hundred to another’s three hundred is equitably entitled to this surplus exchange value. There is no more reason why we should pool the results of our lands than the results of our hands. And to compel such pooling is as meddlesome and tyrannical in one case as in the other. That school of Socialistic economists which carries Henry George’s idea to its conclusions, confiscating not only rent but interest and profit and equalizing wages,—a school of which G. Bernard Shaw may be taken as a typical representative,—is more logical than the school to which Mr. George and Egoist belong, because it completes the application of the tyrannical principle.
(8) Here again we have the assumption of the community’s superior title to the land.
(9) Yes, the bargain of the highwayman to deliver another’s goods.
(10) The cultivator of land who does not ask protection does not expect the community to secure him the opportunity referred to. He simply expects the community not to deprive him of this opportunity. He does not say to the community: “Here! an invader is trying to oust me from my land; come and help me drive him off.” He says to the community: “My right to this land is as good as yours. In fact it is better, for I am already occupying and cultivating it. I demand of you simply that you shall not disturb me. If you impose certain burdens upon me by threatening me with dispossession, I, being weaker than you, must of course submit temporarily. But in the mean time I shall teach the principle of liberty to the individuals of which you are composed, and by and by, when they see that you are oppressing me, they will espouse my cause, and your tyrannical yoke will speedily be lifted from my neck.”
(11) No other! Is Egoist’s measure individualistic, then? I have already pointed out its communistic and authoritarian character.
(12) If the cost principle of value cannot be realized otherwise than by compulsion, then it had better not be realized. For my part, I do not believe that it is possible or highly important to realize it absolutely and completely. But it is both possible and highly important to effect its approximate realization. So much can be effected without compulsion,—in fact, can only be effected by at least partial abolition of compulsion,—and so much will be sufficient. By far the larger part of the violations of the cost principle—probably nine-tenths—result from artificial, law-made inequalities; only a small portion arise from natural inequalities. Abolish the artificial monopolies of money and land, and interest, profit, and the rent of buildings will almost entirely disappear; ground rents will no longer flow into a few hands; and practically the only inequality remaining will be the slight disparity of products due to superiority of soil and skill. Even this disparity will soon develop a tendency to decrease. Under the new economic conditions and enlarged opportunities resulting from freedom of credit and land classes will tend to disappear; great capacities will not be developed in a few at the expense of stunting those of the many; talents will approximate towards equality, though their variety will be greater than ever; freedom of locomotion will be vastly increased; the toilers will no longer be anchored in such large numbers in the present commercial centres, and thus made subservient to the city landlords; territories and resources never before utilized will become easy of access and development; and under all these influences the disparity above mentioned will decrease to a minimum. Probably it will never disappear entirely; on the other hand, it can never become intolerable. It must always remain a comparatively trivial consideration, certainly never to be weighed for a moment in the same scale with liberty.