Progress and Poverty, Henry George [read novels website .TXT] 📗

to the workmen, and the capitalist but takes his proportion of the net produce, it is simply the system that has prevailed to a large extent in European agriculture since the days of the Roman Empire⁠—the colonial or metayer system. All that is claimed for cooperation in production is, that it makes the workman more active and industrious⁠—in other words, that it increases the efficiency of labor. Thus its effect is in the same direction as the steam engine, the cotton gin, the reaping machine⁠—in short, all the things in which material progress consists, and it can produce only the same result⁠—viz., the increase of rent.

It is a striking proof of how first principles are ignored in dealing with social problems, that in current economic and semi-economic literature so much importance is attached to cooperation as a means for increasing wages and relieving poverty. That it can have no such general tendency is apparent.

Waiving all the difficulties that under present conditions beset cooperation either of supply or of production, and supposing it so extended as to supplant present methods⁠—that cooperative stores made the connection between producer and consumer with the minimum of expense, and cooperative workshops, factories, farms, and mines, abolished the employing capitalist who pays fixed wages, and greatly increased the efficiency of labor⁠—what then? Why, simply that it would become possible to produce the same amount of wealth with less labor, and consequently that the owners of land, the source of all wealth, could command a greater amount of wealth for the use of their land. This is not a matter of mere theory; it is proved by experience and by existing facts. Improved methods and improved machinery have the same effect that cooperation aims at⁠—of reducing the cost of bringing commodities to the consumer and increasing the efficiency of labor, and it is in these respects that the older countries have the advantage of new settlements. But, as experience has amply shown, improvements in the methods and machinery of production and exchange have no tendency to improve the condition of the lowest class, and wages are lower and poverty deeper where exchange goes on at the minimum of cost and production has the benefit of the best machinery. The advantage but adds to rent.

But suppose cooperation between producers and land owners? That would simply amount to the payment of rent in kind⁠—the same system under which much land is rented in California and the Southern States where the land owner gets a share of the crop. Save as a matter of computation it in no wise differs from the system which prevails in England of a fixed money rent. Call it cooperation, if you choose, the terms of the cooperation would still be fixed by the laws which determine rent, and wherever land was monopolized, increase in productive power would simply give the owners of the land the power to demand a larger share.

That cooperation is by so many believed to be the solution of the “labor question” arises from the fact that, where it has been tried, it has in many instances improved perceptibly the condition of those immediately engaged in it. But this is due simply to the fact that these cases are isolated. Just as industry, economy, or skill may improve the condition of the workmen who possess them in superior degree, but cease to have this effect when improvement in these respects becomes general, so a special advantage in procuring supplies, or a special efficiency given to some labor, may secure advantages which would be lost as soon as these improvements became so general as to affect the general relations of distribution. And the truth is, that, save possibly in educational effects, cooperation can produce no general results that competition will not produce. Just as the cheap-for-cash stores have a similar effect upon prices as the cooperative supply associations, so does competition in production lead to a similar adjustment of forces and division of proceeds as would cooperative production. That increasing productive power does not add to the reward of labor, is not because of competition, but because competition is one-sided. Land, without which there can be no production, is monopolized, and the competition of producers for its use forces wages to a minimum and gives all the advantage of increasing productive power to land owners, in higher rents and increased land values. Destroy this monopoly, and competition could exist only to accomplish the end which cooperation aims at⁠—to give to each what he fairly earns. Destroy this monopoly, and industry must become the cooperation of equals.

V From Governmental Direction and Interference

The limits within which I wish to keep this book will not permit an examination in detail of the methods in which it is proposed to mitigate or extirpate poverty by governmental regulation of industry and accumulation, and which in their most thoroughgoing form are called socialistic. Nor is it necessary, for the same defects attach to them all. These are the substitution of governmental direction for the play of individual action, and the attempt to secure by restriction what can better be secured by freedom. As to the truths that are involved in socialistic ideas I shall have something to say hereafter; but it is evident that whatever savors of regulation and restriction is in itself bad, and should not be resorted to if any other mode of accomplishing the same end presents itself. For instance, to take one of the simplest and mildest of the class of measures I refer to⁠—a graduated tax on incomes. The object at which it aims, the reduction or prevention of immense concentrations of wealth, is good; but this means involves the employment of a large number of officials clothed with inquisitorial powers; temptations to bribery, and perjury, and all other means of evasion, which beget a demoralization of opinion, and put a premium upon unscrupulousness and a tax upon conscience; and, finally, just in proportion as the tax accomplishes its