Tollgates and Tollpayers

Henry George: The Condition of Labor — An Open Letter to Pope Leo XIII in response to Rerum Novarum (1891)

You assume that the labor question is a question between wage-workers and their employers. But working for wages is not the primary or exclusive occupation of labor. Primarily men work for themselves without the intervention of an employer. And the primary source of wages is in the earnings of labor, the man who works for himself and consumes his own products receiving his wages in the fruits of his labor. Are not fishermen, boatmen, cab-drivers, peddlers, working farmers — all, in short, of the many workers who get their wages directly by the sale of their services or products without the medium of an employer, as much laborers as those who work for the specific wages of an employer? In your consideration of remedies you do not seem even to have thought of them. Yet in reality the laborers who work for themselves are the first to be considered, since what men will be willing to accept from employers depends manifestly on what they can get by working for themselves.

You assume that all employers are rich men, who might raise wages much higher were they not so grasping. But is it not the fact that the great majority of employers are in reality as much pressed by competition as their workmen, many of them constantly on the verge of failure? Such employers could not possibly raise the wages they pay, however they might wish to, unless all others were compelled to do so.

You assume that there are in the natural order two classes, the rich and the poor, and that laborers naturally belong to the poor.

It is true as you say that there are differences in capacity, in diligence, in health and in strength, that may produce differences in fortune. These, however, are not the differences that divide men into rich and poor. The natural differences in powers and aptitudes are certainly not greater than are natural differences in stature. But while it is only by selecting giants and dwarfs that we can find men twice as tall as others, yet in the difference between rich and poor that exists today we find some men richer than other men by the thousandfold and the millionfold.

Nowhere do these differences between wealth and poverty coincide with differences in individual powers and aptitudes. The real difference between rich and poor is the difference between those who hold the tollgates and those who pay toll; between tribute-receivers and tribute-yielders.

In what way does nature justify such a difference? In the numberless varieties of animated nature we find some species that are evidently intended to live on other species. But their relations are always marked by unmistakable differences in size, shape or organs. To man has been given dominion over all the other living things that tenant the earth. But is not this mastery indicated even in externals, so that no one can fail on sight to distinguish between a man and one of the inferior animals? Our American apologists for slavery used to contend that the black skin and woolly hair of the negro indicated the intent of nature that the black should serve the white; but the difference that you assume to be natural is between men of the same race. What difference does nature show between such men as would indicate her intent that one should live idly yet be rich, and the other should work hard yet be poor? If I could bring you from the United States a man who has $200,000,000, and one who is glad to work for a few dollars a week, and place them side by side in your antechamber, would you be able to tell which was which, even were you to call in the most skilled anatomist? Is it not clear that God in no way countenances or condones the division of rich and poor that exists today, or in any way permits it, except as having given them free will he permits men to choose either good or evil, and to avoid heaven if they prefer hell. For is it not clear that the division of men into the classes rich and poor has invariably its origin in force and fraud; invariably involves violation of the moral law; and is really a division into those who get the profits of robbery and those who are robbed; those who hold in exclusive possession what God made for all, and those who are deprived of his bounty? Did not Christ in all his utterances and parables show that the gross difference between rich and poor is opposed to God’s law? Would he have condemned the rich so strongly as he did, if the class distinction between rich and poor did not involve injustice — was not opposed to God’s intent? ...

If when in speaking of the practical measures your Holiness proposes, I did not note the moral injunctions that the Encyclical contains, it is not because we do not think morality practical. On the contrary it seems to us that in the teachings of morality is to be found the highest practicality, and that the question, What is wise? may always safely be subordinated to the question, What is right? But your Holiness in the Encyclical expressly deprives the moral truths you state of all real bearing on the condition of labor, just as the American people, by their legalization of chattel slavery, used to deprive of all practical meaning the declaration they deem their fundamental charter, and were accustomed to read solemnly on every national anniversary. That declaration asserts that “We hold these truths to be self-evident — that all men are created equal; that they are endowed by their Creator with certain unalienable rights; that among these are life, liberty, and the pursuit of happiness.” But what did this truth mean on the lips of men who asserted that one man was the rightful property of another man who had bought him; who asserted that the slave was robbing the master in running away, and that the man or the woman who helped the fugitive to escape, or even gave him a cup of cold water in Christ’s name, was an accessory to theft, on whose head the penalties of the state should be visited?

Consider the moral teachings of the Encyclical:

• You tell us that God owes to man an inexhaustible storehouse which he finds only in the land. Yet you support a system that denies to the great majority of men all right of recourse to this storehouse.
• You tell us that the necessity of labor is a consequence of original sin. Yet you support a system that exempts a privileged class from the necessity for labor and enables them to shift their share and much more than their share of labor on others.
• You tell us that God has not created us for the perishable and transitory things of earth, but has given us this world as a place of exile and not as our true country. Yet you tell us that some of the exiles have the exclusive right of ownership in this place of common exile, so that they may compel their fellow-exiles to pay them for sojourning here, and that this exclusive ownership they may transfer to other exiles yet to come, with the same right of excluding their fellows.
• You tell us that virtue is the common inheritance of all; that all men are children of God the common Father; that all have the same last end; that all are redeemed by Jesus Christ; that the blessings of nature and the gifts of grace belong in common to all, and that to all except the unworthy is promised the inheritance of the Kingdom of Heaven! Yet in all this and through all this you insist as a moral duty on the maintenance of a system that makes the reservoir of all God’s material bounties and blessings to man the exclusive property of a few of their number — you give us equal rights in heaven, but deny us equal rights on earth!

It was said of a famous decision of the Supreme Court of the United States made just before the civil war, in a fugitive-slave case, that “it gave the law to the North and the nigger to the South.” It is thus that your Encyclical gives the gospel to laborers and the earth to the landlords. Is it really to be wondered at that there are those who sneeringly say, “The priests are ready enough to give the poor an equal share in all that is out of sight, but they take precious good care that the rich shall keep a tight grip on all that is within sight”? ... read the whole letter

Rev. A. C. Auchmuty: Gems from George, a themed collection of excerpts from the writings of Henry George (with links to sources)

IF we are all here by the equal permission of the Creator, we are all here with an equal title to the enjoyment of His bounty — with an equal right to the use of all that nature so impartially offers. This is a right which is natural and inalienable; it is a right which vests in every human being as he enters the world, and which, during his continuance in the world, can be limited only by the equal rights of others. There is in nature no such thing as a fee simple in land. There is on earth no power which can rightfully make a grant of exclusive ownership in land. If all existing men were to unite to grant away their equal rights, they could not grant away the right of those who follow them. For what are we but tenants for a day? Have we made the earth that we should determine the rights of those who after us shall tenant it in their turn? The Almighty, who created the earth for man and man for the earth, has entailed it upon all the generations of the children of men by a decree written upon the constitution of all things — a decree which no human action can bar and no prescription determine, Let the parchments be ever so many, or possession ever so long, natural justice can recognize no right in one man to the possession and enjoyment of land that is not equally the right of all his fellows. — Progress & Poverty — Book VII, Chapter 1, Justice of the Remedy: Injustice of private property in land

HAS the first comer at a banquet the right to turn back all the chairs and claim that none of the other guests shall partake of the food provided, except as they make terms with him? Does the first man who presents a ticket at the door of a theater and passes in, acquire by his priority the right to shut the doors and have the performance go on for him alone? Does the first passenger who enters a railroad car obtain the right to scatter his baggage over all the seats and compel the passengers who come in after him to stand up?

The cases are perfectly analogous. We arrive and we depart, guests at a banquet continually spread, spectators and participants in an entertainment where there is room for all who come; passengers from station to station, on an orb that whirls through space — our rights to take and possess cannot be exclusive; they must be bounded everywhere by the equal rights of others. Just as the passenger in a railroad car may spread himself and his baggage over as many seats as he pleases, until other passengers come in, so may a settler take and use as much land as he chooses, until it is needed by others — a fact which is shown by the land acquiring a value — when his right must be curtailed by the equal rights of the others, and no priority of appropriation can give a right which will bar these equal rights of others. — Progress & Poverty — Book VII, Chapter 1, Justice of the Remedy: Injustice of private property in land ...

GREAT as John Stuart Mill was and pure as he was — warm heart and noble mind — he yet never saw the true harmony of economic laws, nor realized how from this one great fundamental wrong flow want and misery, and vice and shame. Else he could never have written this sentence: "The land of Ireland, the land of every country, belongs to the people of that country. The individuals called landowners have no right in morality and justice to anything but the rent, or compensation for its salable value."

In the name of the Prophet — figs! If the land of any country belong to the people of that country, what right, in morality and justice, have the individuals called landowners to the rent? If the land belong to the people, why in the name of morality and justice should the people pay its salable value for their own?

Herbert Spencer says: "Had we to deal with the parties who originally robbed the human race of its heritage, we might make short work of the matter?" Why not make short work of the matter anyhow? For this robbery is not like the robbery of a horse or a sum of money, that ceases with the act. It is a fresh and continuous robbery, that goes on every day and every hour. It is not from the produce of the past that rent is drawn; it is from the produce of the present. It is a toll levied upon labor constantly and continuously. Every blow of the hammer, every stroke of the pick, every thrust of the shuttle, every throb of the steam engine pay it tribute. It levies upon the earnings of the men who, deep underground, risk their lives, and of those who over white surges hang to reeling masts; it claims the just reward of the capitalist and the fruits of the inventor's patient effort; it takes little children from play and from school, and compels them to work before their bones are hard or their muscles are firm; it robs the shivering of warmth; the hungry, of food; the sick, of medicine; the anxious, of peace. It debases, and embrutes, and embitters. — Progress & Poverty — Book VII, Chapter 3, Justice of the Remedy: Claim of Landowners to Compensation ... go to "Gems from George"

Arthur J. Ogilvy: A Colonist's Plea for Land Nationalization (about 1890)

If I sell goods or perform work for another, then no matter how high I may charge for the goods or the work, I am rendering goods for goods, service for service, earnings for earnings. What I offer is my labour, or the fruits of it, and as the public are free to get the same goods or services elsewhere if my terms don't suit, or to go without them, the fact of their accepting my terms shows that the thing I offer is, under the circumstances, worth the money.

But in the case of this unearned increment on land there is no pretence of any exchange. I offer for it neither labour nor the produce of labour. All I do is to place my hand on a certain portion of the earth's surface, and say, "No one shall use this without paying me for the mere permission to use it." I am rendering no more service in return for this extra pound, either to the purchaser or to society, than if I had acquired exclusive title to the air, and charged people for permission to breathe. And if, instead of selling my land for an additional pound, I let it at a proportionately additional rent the principle would be the same.

The increase of value in my land has arisen from the execution of public works and increase of population, causing an increased demand for the land; in other words, it has arisen from the national progress; and I, so far from aiding in this progress have actually hindered it, by keeping my property locked up and so forcing on intending producers to inferior or less accessible lands; and by holding so much land back have helped to make land so much scarcer, and, therefore, so much dearer, and so have helped to increase the tribute which industry has to pay to monopoly for the mere privilege of exerting itself. ...

Whether the value of land and the value of the improvements can be separated or not, they are quite distinct elements, just as in a glass of grog, the brandy is brandy and the water water, each with its own distinctive properties and effects, notwithstanding their indistinguishable com-mixture; and he therefore who lets land levies blackmail upon industry by charging for something which represents no service at all, none the less that at the same time he charges for something else that does represent service.

No doubt there are many other things besides land in which a monopoly of the article will enable the possessor to levy something resembling blackmail; but there are points of difference that distinguish them all from the pure and simple appropriation of land monopoly. ...

But it ought to be clear by this time that if all existing landlords were swept away and all the land in use confirmed absolutely upon the occupiers, things would be no better than they are now.

For the evil that weighs upon society, hindering progress, forcing down earnings, and making life to all who have to live by work a struggle for existence is the monopoly of the land; and whether it is A or B who monopolises it, is of no consequence to anybody but A and B.

Wherever one man is allowed to acquire more land than he can use by his own labour for the purpose of preventing other people from using it by their labour except for his profit, that man is master of the situation, and the class of which he is the representative has the world at its feet. And whether the monopolist turns his monopoly to account as an occupying owner by working the labourers for his profit directly, or as a nonoccupier by selling to somebody else (called a tenant) for a yearly payment (called rent) the privilege of working them, is a difference not worth talking about. ...

I have employed my land not as an instrument of production, but as a means of extortion. I have bought it, not to use but to prevent other people from using it without my purchased leave; not to earn anything by it but to obtain the power of demanding the earnings of others.

Suppose certain parties, knowing that a road would shortly be made into a particular region, bought from Government the privilege of placing bars across the road (when made) and forbidding anybody to pass until he had paid toll; toll not (as under the old State tolls) to pay for the maintenance of the road, but toll for the mere permission to pass along the road. Every one would recognise that this toll was pure blackmail and not earnings, and the obstructors mere parasites licensed to prey upon the public. But where is the difference between blocking the road and blocking the land that the roads lead to? Where is the difference between levying blackmail on the transport of goods and levying it on their production?

But it will be said, "It was with real earnings that I bought the right to demand this payment."

True. But the point is that whether I bought it or stole it, the thing I have bought or stolen is the privilege of levying blackmail upon industry; of demanding something and giving nothing in return; of laying my hand on the earth's surface and saying to all and sundry, "Give me of the produce of your labour, or be off with you; so much a year if I choose to let it; so much in a lump sum if I prefer to sell it." Whichever of the two forms the demand assumes it is called by political economists "rent," and by that name I shall henceforth call it, because that is the accepted name, and because there is no other compact and handy term by which to express it; but it is not to be confounded with rent in the legal and commercial sense, which includes interest on the cost of improvements. The rent I shall mean is economic rent only; the price charged for the mere use of the land as such, either without any improvements or apart from them: I shall mean "ground rent" in short.

... read the whole paper.