[Unedited]
“For always in thine eyes, O Liberty!
Shines that high light whereby the world is saved;
And though thou slay us, we will trust in thee.”
John Hay.
Cranky Notions.
“No man has any right to exclude another from any portion of the earth unless he compensates that other for exclusion,” says W. E. Brokaw, Single Taxer, in an article in Single-Tax syndicate papers.
Suppose two men were in a boat and that was all the boat would hold, would a third man be entitled to an equal share of the boat, assuming the boat had been found and was not the result of the work of any of the three? What right at all would the third man have to the boat? Suppose there is an island in the middle of the ocean capable of supporting one hundred persons and one hundred persons are cultivating the soil and making their home there, and ten or fifteen others come from some other place and want to live on the island, what rights have these latter to the land which the one hundred are bound in equity and justice to respect?
Suppose, again, one hundred, or more, or less, settle on no more land than they need to support their own life and comfort, where do any other persons get any right whatever to the land occupied or any of its products?
If a person use no more of nature’s materials and forces than are sufficient to maintain the existence and comfort of himself and those dependent upon him, where do others get the right, in justice and equity, to dispossess him unless he gives up a portion of the products which are the result of his own labor?
I would like to have some Single Taxer answer these questions. Much may depend on their correct answer.
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And now some of our reformer friends are to save the world by the Initiative and the Referendum. If this system is of so much importance to the welfare of the people, why is not Switzerland a paradise? It is true, Switzerland has many things beneficially affecting the people’s welfare not obtaining even in other republics, or democracies, but is it worth the labor and expense for reformers to aim at that political change? Capital punishment was abolished in Switzerland in 1874, but there is now a probability that it will be reenacted, and by the Initiative and Referendum, too. If the majority under that ideal(?) political system voted that twice two is six or that the earth is flat, it certainly would not make them so. But it would show that the majority think that twice two is six and that the earth is flat. If it is only the opinion of the majority of the voters that needs to be ascertained, I grant you this is a good way of learning that. But I do not understand that this is the object of the reformer who fully comprehends the problem, or who even understands it fairly well. The essence of the movement is to obtain political liberty, but it surely is not political liberty to be governed by the whims and the will of others, even though they be in the majority. Why should the majority govern any more than the minority? This is a question I have never had answered satisfactorily. If the will of others is to be the law which is to govern me, I don’t know as it makes much difference whether it be that of the biggest or the littlest crowd. In the trades unions, where the Initiative and the Referendum prevail, I have seen the grossest injustice done by the largest kind of majorities. The minorities could have done no worse. My opinion is that the truth should be my guide, the law by which I should be governed. If this opinion is sound, then it is immaterial to me if the majority approve of the law or not, so long as they let me be governed by it. It will take you no longer to learn this truth than to learn the fallacy of the Initiative and the Referendum as efficient means of justice. Joseph A. Labadie.
Interest Just and Unjust.
In the address of Mr. Hugo Bilgram (Liberty of April 22) is found much to approve. What he says about the interest on privileged money can be questioned by no honest criticism. It is simply unjust. Whether there is not interest of another kind, and other sources which produce monopolistic interest, are quite other questions. To me it seems plain that there are economic conditions which produce interest independent of monopoly, and that there are several monopolies, besides that of money, which bear an unjust interest.
Patent right, government privilege to follow certain productive callings and to buy and sell goods, are joint factors with privileged money in yielding onerous interest. And beneath all these lies the legal protection to unlimited dominion of the land. Whether “the government prescribes the number of shoes in the country,” or prescribes the number of shoemakers, the people will have to pay the interest or profit, and suffer the inconvenience, caused by unjust legislation, the same as when compelled to hire money from a privileged banker. It is far worse when the government yields up to the control of the class who are able to buy into it, the dominion of all the fruit-yielding land to the exclusion of the people, who have now to hire the natural sources of all wealth.
Nor do I quite agree with him that the interest-bearing power of money confers the profit-bearing power upon capital. On the contrary, I am quite sure that capital, particularly land, could not be bought at all with money which bore no interest, because, in the absence of all money, monopolized land would be let to the laborer, as has been done in all time, without valuation in the terms of money at all, for a part of the annual produce of the labor applied. I doubt not that interest would continue, if lawful money was abolished and the circulation of credits left free. If one owns a farm from which he cannot raise more than a bare subsistence, he can pay no interest to mortgagee or banker. No one hires money for its own sake. All know it to be barren. So far as a direct exchange is concerned, it matters not whether money be cheap or dear. The simultaneous exchanges will be affected in the same way. The terms in money make no difference to the relative values of the things exchanged. It is only when one wants to buy and has nothing to buy with that he needs to borrow money. It is not the producer as such, but only the borrower, who suffers wrong. It is only the lender who is benefited.
But there is a variable rate of interest, profit, or rent, arising from the use of capital, not at all attributable to legal monopolies of any kind, but which capitalism has succeeded by the aid of “appropriate legislation” in engrossing. It is the whole product of labor, save a bare support to the laborer, or, what is nearly the same thing, the difference between what he would produce coöperating with the capital, or by working without it. This is more particularly true of the land, without which labor can pay no interest on money legal or free, or indeed effect any product whatever. Hence unconditioned dominion of the land is the ultimate source of all tributary interest, rent, or profits, the three being different only in name.
Beside the tributary increment, the same thing appears under economic law, released from the State class laws, and which arises from the ability of labor to produce more than it consumes, and which normally, under equal freedom, becomes the property of the laborer, and is therefore not inequitable or unjust, because promotive of the general industrial prosperity. J. K. Ingalls.
Gary vs. the Supreme Court.
William M. Salter, writing in the Philadelphia “Conservator,” raises a new point with reference to the remarkable apology of Judge Gary, in the “Century,” for the verdict in the “Chicago Anarchist” case, in the following language:
Judge Gary’s defence of the verdict is virtually this, — that the persons tried had used violent, inflammatory language, examples of which he gives at great length; that they were partners to a conspiracy to overthrow law and order; that it is inconceivable that the throwing of the bomb on the 4th of May, 1888, was not the result of the ravings and the plottings referred to, and hence that the whole body of the conspirators were accessories to the act of throwing and responsible for it.
It will be remembered that the case was appealed to tile Supreme Court of Illinois: it is interesting to note that the opinion of this Court follows a somewhat different line of reasoning from that which Judge Gary pursues. In the trial in Chicago much evidence was produced to show that the accused persons bad not only talked or written in a wild, bloodthirsty way, and were not only members of the general conspiracy known as the International Association, but that they had entered into a special and particular conspiracy to commit a violent deed on or about the 4th of May, and had incited and inflamed the passions of men directly to that end. The Supreme Court in its opinion reviews all this evidence. Three-quarters of the opinion is given up to a discussion of it. In the eyes of the Supreme Court it evidently bore vitally on the case. And because it judged the evidence to be valid, it refused to reverse the decision of the lower court. In other words, the merely general grounds on which Judge Gary now defends the verdict did not apparently satisfy the Supreme Court of Illinois. On the other hand, the evidence which the Supreme Court treated at such length is not so much as mentioned in Judge Gary’s present article. This is nothing less than extraordinary. And yet it should be said it is on the worth and conclusiveness of this special evidence that most of the questioning of the justice of the verdict turns. No one can deny the facts to which Judge Gary alludes, nor can any one question that the Anarchists by talking and writing as they did committed a grave offence. But what one may question, and what many have questioned, is whether they had any such direct connection with the wild act of the night of the 4th of May as the Supreme Court of Illinois judged them to have had. It is, perhaps, not too much to say that Judge Gary is more or less sensible of the inconclusiveness of the evidence bearing on this point, and for this reason does not allude to it. Yet, if this evidence is inconclusive, the Supreme Court was in error, and, according to its implied standards of judgment, the men should not have been hung. In brief, Judge Gary is skeptical of the ground which the Supreme Court took; and the Supreme Court is (was) skeptical of the present ground of Judge Gary. In either case, the public is not likely to be reassured by the apparent divergence of opinion in high circles that a wrong was not committed be the hanging of the men.
“In abolishing rent and interest, the last vestiges of old-time slavery, the Revolution abolishes at one stroke the sword of the executioner, the seal of the magistrate, the club of the policeman, the gunge of the exciseman, the erasing-knife of the department clerk, all those insignia of Politics, which young Liberty grinds beneath her heel.” — Proudhon.
The appearance in the editorial column of articles over other signatures than the editor’s initial indicates that the editor approves their central purpose and general tenor, though he does not hold himself responsible for every phrase or word. But the appearance in other parts of the paper of articles by the same or other writers by no means indicates that he disapproves them in any respect, such disposition of them being governed largely by motives of convenience.
Spencer and George. — IV.
On the subject of compensation to landowners on abolition of their ownership George says: “The same principle is involved in other questions which are already, or may soon become, of practical importance.” This arouses curiosity without satisfying it. He refers to slavery, pensions, protection by the tariff and inventions. It is easy to separate them into past and present or future questions.
“It is not,” says George, “a question of all right of compensation. That the State should compensate when it destroys a building to make way for a public improvement, or takes goods or provisions or horses or shipping for which it may have sudden need, or demands of some citizens services which it does not demand of others, is not in question. The right of compensation in such cases is not disputed.”
He makes no protest against the State’s demanding of some citizens “services which it does not demand of others.” Suppose such services involve the loss of life? The demand certainly has first derided liberty. Compensation may then be made to the heirs of the murdered captives. No compensation is possible to the victims. Their liberty and life were unique, and they, being dead, are incapable of taking compensation, were it possible to ascertain what it should be. Hence we see that George professes willingness to give compensation where it is not possible. Let us see whether the case where he refuses it on the ground of alleged impossibility is not rather a possible case. In order to shut out compensation to landholders George gives prominence to the definition that compensation means an equivalent for the thing taken. He follows with glee the vagaries of Spencer in “Justice” heaping up pretensions on behalf of the landlords to show that compensation as they claim it would be impossible. The equivalent of an interest-bearing fund is another interest-bearing fund as large. If George has seem more truth, he has suppressed it.
It would be pedantic to cite passages in which George has indorsed the doctrine that the earth belongs in usufruct to each succeeding generation. If this doctrine be accepted, the alleged impossibility of reasonable compensation disappears; for those who hold that the State adequately represents society and that the earth belongs to each generation of society can well admit that an alienation of the use of a given portion of the earth for a generation is within the capacity and discretion of the representative organization of society and plainly distinguishable from an alleged alienation of use from future generations, which is neither possible, nor can adequate consideration have been received for it, nor received by the true owners to come. Hence I reason that, if the ownership be held to run by generations, George could have easily found a way out of the difficulty, which he purposely renders as hard as his imagination can make it by refusing to draw upon his reason and to recall his own doctrine.
He delights in comparing land-owning with theft or with bounties which have been got for nothing. People take slave property at their risk, he says. Certainly they do; but, if a State had sold slaves to its citizens, they would say that, so far as the lawyer’s relation to the State was concerned, the risk stated was a risk of repudiation of a warranty, — a proceeding which is at war with society’s innermost claim to continuity, or if, as suggested by a former remark of George’s, such repudiation were necessary, then compensation would be in order. Now, according to George’s own doctrines and those almost universally received the occupancy of land is as right in itself as the holding of slaves is wrong in itself. If a State had sold slaves and received pay for them, the owner would have an equitable claim against the State, in case of State action for emancipation, no matter for the right of the slave to be free. The land-owner could rest on this ground without saying anything of the rightfulness of his possession in contrast with slavery. The case between him and the State is not to be confused with the case between him and other persons, the State being out of the way. If I hold a United States bond, none of you as individuals owe me anything; but who says that the United States government is not bound to pay me? George has argued as if the absence of individual obligation to pay the bond were warrant for the government, in despite of its having got my money, to repudiate the bond. It sold me land; nobody need respect its title; therefore it need not respect that title. Such a government owes nothing to decency, then, or it would abdicate and let the individuals repudiate its contracts instead of having the effrontery to continue in existence as their agents in the repudiation.
It is tolerably evident that there floats in George’s mind the idea of an interest-bearing fund equivalent to the selling value of the land on the assumption that this generation has the right and power to bind all future generations, and that the rate of interest will not decrease. By the aid of this assumption, which is in conflict with what he holds as the right and power of a given generation, he gleefully forces his way to the foregone conclusion that compensation — a full equivalent for the franchise taken — is impossible.
Spencer at the last, for the purpose of sustaining the landlords or else in burlesque, has figured out in his way that compensation would not be remunerative. Neither of them has adhered to the line of inquiry as to what there is to compensate for that can be reached, according their premises.
George indeed pretends that he would not dispossess anybody. This, however, only means that the owner could stay as a tenant because the State could have no preference as to persons. It is, therefore, a statement that the owner of the nut is welcome still to hold the nutshell.
Ownership for use and legal ownership for speculation are thrown together, and the tax from the former may go to hire troops to keep the people from trespassing upon the latter, by George’s plan. The unrepentant State, after swindling people by selling land to them for all time, would evict them from their immovable improvements even during the term when it could well afford to stand by its bargain reduced to reason according to the premise of a generation’s tenure. This result would follow in cases where the improvements were not of a kind to yield the pecuniary returns to which the location could be turned, and when the owner had not the surplus capital and knack to make the change which another might stand ready to make, who could look complacently upon existing improvements, not of a money-making character, as things to be torn up and thrown aside. Tak Kak.
Note. — If the editor will compare what I said about huts in my last article with what he states that I said, he may see a difference. The occupier of the hut in the case generally acquires it on the expectation that he may return service. The hut is distinct evidence of co-operative work. At the same time it is fresh in the minds of the people that some have had huts built who have never lived to return a full equivalent. It is known that no exact repayment is stipulated.
I think that a person is as truly the owner of what he acquires by exchange of services as of what he makes alone, but I think the evidence of others’ work will often be more distinct to observation than the evidence of their payment.
Community aid in building a young couple a hut gives them the hut at once, and it may be years before the man has done enough at odd times to square the debt. If he dies young, the aid that has been given him goes as a donation. The people generally are already in possession of huts, and, except for insurance or to get aid in building huts for their children, It is not known that they expect anything except goodfellowship. Of course, when it is the fact that a man has helped to build many huts, — that is, when he has more than paid his debt, — the community recognizes that he has paid for the hut he had built for him. T. K.
Why Abolish Interest?
To the Editor of Liberty:
Although I have been a careful reader of your interesting paper for something over a year, I have to con-fess my incapacity to understand why you advocate the abolition of rent and interest, and I hope you will consider me a pupil willing to learn if Liberty can furnish a teacher. At the outset I will explain how rent and interest appear to me, as, if you know what fallacies I am cherishing, it will greatly facilitate you in undertaking their overthrow. Instead of “the last vestiges of old-time slavery,” rent and interest seem to me to be useful instruments of mutual accommodation between man and man, by the use of which one who has accumulated something which the other has not may permit this other the use of his accumulations in a manner compromising the dignity of neither. To illustrate, here is a cook who by her labors has saved a handsome sum of money which she is glad to have a bank take care of for her convenience. Here also is a young man whose labors have enabled him to build himself a little house. Suddenly a prospect presents itself of his taking a share in a promising business if he can contribute a share of capital sufficient to pay his portion of the expenses until the profits of the business can be divided. Two opportunities for raising the needed capital present themselves; a man who has no house of his own, and who does not wish to build one, offers to pay him rent for the privilege of temporarily living in his house, and the cook’s money can be borrowed for temporary use if he will pay her something for the accommodation she thus, through the bank, furnishes him. The bank as the negotiator between borrower and lender justly receives a portion of the interest. This, as it seems to me, is a fair sample of the whole process which Proudhon so violently opposes. If we suppose that the cook sets up an employment bureau, makes a snug little fortune by her efforts and good management, then leaves it to her daughter who spends her life as a mere capitalist, or lender of that stored-up labor of her mother’s, what wrong is there in this? I dare say I may seem to you very ignorant and superficial, but, at least, I know enough to want to know, and if you will kindly enlighten me, you may be as severe upon my stupidity as you choose. An Enquirer.
My enquiring friend is by no means stupid. Her argument is well and clearly stated and is indicative of the habit of thought. Neither is she ignorant or superficial in the sense in which those terms are usually employed for the general characterization of personality. She has simply failed to acquaint herself with the position of the Anarchistic opponents of interest, the soundness of which her native power of penetration will enable her to see when once she has become familiar with it.
Wherein consists her misapprehension? In this, — that she supposes the Anarchists to condemn the contract between the borrower and the lender, per se; whereas the truth is that they condemn, not the contract, but the conditions of compulsory restriction and limitation under which such contract is now necessarily made if made at all, and in the absence of which it would be prevented, not by law or by invasion of any kind, but by simple competition, from embodying the element of interest on capital.
Take the case which she cites. No Anarchist disputes that it is perfectly legitimate for the young man in question to borrow either of the cook or of the bank upon such terms as may be agreed upon in a free market. The complaint of Anarchism is that the market is not free, and that the transactions effected therein are necessarily tainted with injustice. At present, if the young man borrows, whether of the cook or of the bank, the terms of the contract are dictated, to his disadvantage, by means of a legal privilege or monopoly enjoyed by the bank. Neither cook nor bank will lend to the young man unless he can give a note the redemption of which is considered sure and is generally made sure by a lien upon actual property. Upon being thus secured, the lender supplies the borrower with other notes, intrinsically no stronger, but in the redemption of which not only the lender and borrower but the entire community have reason to have confidence. That is to say, the lender, either by issuing his own universally known notes or by furnishing equally well known notes previously issued by others, virtually indorses the borrower’s note, or, in still other words, insures his credit. For this service what does he charge? A price as low as that for which any one else is willing and able to perform the same service. Now, the Anarchists assert that there are large numbers of people who are willing, either individually or by forming themselves into banking associations, to perform this service at something less than one per cent., and that the only reason why they are not able to do so is that they are prevented by law. The grounds upon which they base this assertion are, first, the fact that prices in a free market tend toward cost of production and performance, which, in the matter of insurance of credit, is shown by banking statistics to be about one-half of one per cent., and, second, the existence of Federal laws imposing a tax of ten per cent. on all banks of issue not complying with the provisions of the national banking act, and of State laws making it a crime to circulate as currency other notes than those specifically authorized by statute. To this it is no answer to say that all persons are equally free to com-ply with the provisions of the national banking act; for these provisions by their very nature, limiting the basis of currency to government bonds, limit the volume of the currency, and in any business a limitation which reduces the output is as truly a restriction of competition as a limitation specifying that only certain persons shall engage in the business. Now, if the above facts and the assertions based on them are correct, it is obvious that, but for these, the price of insuring credit would fall to less than one per cent., this small percentage paying, not dividends to stockholders, but the salaries of banking officials, providing for incidental expenses, and making good any deficiencies from bad debts. Thus is justified the Anarchistic contention that interest upon capital is dependent upon the restrictions-surrounding the contract between borrower and lender; for surely “An Enquirer’s” young man would not be willing to pay the cook six per cent. for money when he could borrow of a bank for one per cent., or able to exact ten per cent. for his house from a homeless man when the latter could hire money at one per cent. with which to buy or build a house.
If there is a flaw in the Anarchistic argument, I wait for “An Enquirer” to point it out. For her sake I have told an old story to the readers of Liberty; but then, I expect to have to tell it many times again. T.
A New Conception of Interest.
The article on interest by J. K. Ingalls, printed in another column, does not seem to me to be written in its author’s usual clear style. Some of his positions are true without qualification, but others can be regarded as true only by using the word interest in an entirely new sense.
If rent and profit are to be considered interest, then it is true that “there are several monopolies, besides that of money, which bear an unjust interest”; I presume that this would be readily admitted by Mr. Bilgram, whom Mr. Ingalls is criticising. This, however, is not a very serious departure from economic terminology.
More violent is the use of the word interest to express the entire extra product resulting from labor’s use of capital. If I, who can produce only ten without a spade, succeed in producing twenty with a borrowed spade, for the use of which I pay six, then in Mr. Ingalls’s view, if I understand him, the interest on the spade includes not only. the six paid for its use, but the entire extra ten produced by its use. This is intelligible, but to me it is novel. So defining interest, one finds no difficulty in granting, again, that “there are economic conditions which produce interest independent of monopoly.” And since Mr. Ingalls appears to admit that under equal freedom the entire extra ten would fall to me as laborer, and that six would no longer go to the owner of the spade, I am not at all disposed to dispute the justice of interest so defined, and, far from desiring to abolish it, hope to see it vastly multiplied.
But I wonder if Mr. Ingalls uses the word in this sense when he says that “capital, particularly land, could not be bought at all with money which bore no interest.” If so, then still again can I understand and agree with him. For in this sense money that bears no interest means simply money that does not contribute to labor’s power of production, and such money is necessarily representative of no property whatsoever, has no power to circulate, and will not be taken in exchange for anything of value. But thus interpreted the statement is so insignificant that Mr. Ingalls must, it seems to me, have used the word in its usual sense. In that case; however, insignificance is simply replaced by absurdity. For what can be more absurd than to say that a non-interest-bearing note, based upon specific property and for the redemption of which said property can be legally seized, will not be taken in exchange for other property approximating in value that of the property serving as security for the note? It is indeed conceivable that, if the money monopoly were abolished and land monopoly remained, land would rise in value; but it cannot be held for a moment, with any show of reason, that it would bear no price. T.
One of Liberty’s English readers, John Badcock, Jr., has lately published in pamphlet form, through the house of William Reeves, of London, a lecture which he delivered in March before the Walthamstow Literary Institute, entitled “Where Love is Liberty and Nature Law.” It is a strong plea for Anarchism in the relations of the sexes. Mr. Badcock is the corresponding secretary for London of the Legitimation League, a society recently founded by Oswald Dawson, of Leeds, and of which Wordsworth Donisthorpe is president. The object of the League is “to create machinery for acknowledging offspring born out of wedlock, and to secure for them equal rights with legitimate children.”
Taine on Taxation.
Few people are aware, I presume, that Hippolyte Tains, one of the greatest of French intellects, was virtually an Anarchist. His attitude toward the State may be seen in the following extract from one of his works:
The State makes use of the money which it extorts from me to unjustly impose fresh constraints upon me; this is the case when it prescribes for me its theology or its philosophy, when it prescribes for me or denies me a special form of religious observance, when it pretends to regulate my morals and my manners, to limit my labor or my expenditure, to fix the price of my merchandise or the rate of my wages. With the coin which I do not owe it and which it steals from me it defrays the expense of the persecution which it inflicts upon me. . . . Let us beware of the encroachments of the State, and suffer it to be nothing more than a watch-dog.
Force and Justice.
[Pascal.]
Had we been able, we should have put force in the hands of justice: but, as force, being a palpable quality, does not suffer us to dispose of it at will, whereas justice, being a spiritual quality, is thus disposable, we have put justice in the hands of force; and thus we call that just which people are forced to observe.
The Source of Exploitation.
[Voltaire.]
In good politics has been found the secret of causing those to die of hunger who, by cultivating the land, sustain the life of others.
Don’t keep Liberty to yourself, share it with others!
Liberty’s Library
Leonard E. Read: Accent On The Right: To Frederic Bastiat (1801–1850), who sought for truth rather than outcome and never witnessed the fruits his labor bore. Obedience to conscience was his first rule; we witness the results.
Leonard E. Read: Anything That’s Peaceful: Many favor peace but not many favor the things that make for peace. — Thomas à Kempis
Leonard E. Read: Awake for Freedom’s Sake: Finally, share with others. Forget about “reforming” them! The more we share, the more we learn. This is in the interest of self and freedom!
Leonard E. Read: Castles in the Air: If you have built castles in the air, your work need not be lost; there is where they should be. Now put foundations under them. — Henry David Thoreau
Libertarian Anarchy: Against the State: Political philosophy is dominated by a myth, the myth of the necessity of the state. The state is considered necessary for the provision of many things, but primarily for peace and security. In this provocative book, Gerard Casey argues that social order can be spontaneously generated, that such spontaneous order is the norm in human society and that deviations from the ordered norms can be dealt with without recourse to the coercive power of the state.
Major Conservative and Libertarian Thinkers: Murray Rothbard: Murray Rothbard (1926–1995) was an economist, historian, philosopher, and legal theoretician. His work was unified by a passionate and resolute commitment to a libertarianism that may be characterized as ‘anarcho-capitalism’ and which implied a belief that even the legal system may be provided privately without the need for a coercive collective authority. Hence, anarcho-capitalists envisage a society where the traditional role of government is wholly subsumed by private, profit-making enterprises and all social relationships are ultimately founded upon consent.
