Author Topic: Landlordism creates "dependency"  (Read 2537 times)


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Landlordism creates "dependency"
« on: February 23, 2016, 11:27:41 AM »
"Land has no production cost; it is a 'free and nonreproducible gift of nature.'  The economy has only so much land, and that is that. Of course, within limits any parcel of land can be made more usable by clearing, drainage, and irrigation. But these are capital improvements and not changes in the amount of land itself."

-- Campbell R. McConnell & Stanley L. Brue, Economics, 14th ed., p. 604

"Land, which is the earth's surface, is immobile. It is true that some of the substances of land are removable and topography can be changed, but still that portion of the earth's surface always remains. The geographic location of any given parcel of land can never be changed. It is rigid and fixed."

-- Wade E. Gaddy & Robert E. Hart, Real Estate Fundamentals, 4th ed., p. 9

"Remember: No one is making any more land."

-- William H. Pivar, Real Estate Investing From A To Z, revised edition, p. 3

We're incessantly told that social welfare of any kind is bad because it creates "dependency" upon those who actually produce the wealth that's being "redistributed" to those in need.


Yet by that very standard, landlordism -- the process whereby a mere subset of the population asserts exclusive "ownership" of the land on which all human beings must live yet which no human being "produced," and then charges everyone else a monthly ransom fee (i.e. rent) for mere access to "their" planet -- also creates "dependency" upon the productivity of others, because the location value of land results NOT from anything the titleholder did, but from the presence and activity of the surrounding community:

"Suppose that there is a kind of income which constantly tends to increase, without any exertion or sacrifice on the part of the owners: those owners constituting a class in the community, whom the natural course of things progressively enriches, consistently with complete passiveness on their own part. In such a case it would be no violation of the principles on which private property is grounded, if the state should appropriate this increase of wealth, or part of it, as it arises. This would not properly be taking anything from anybody; it would merely be applying an accession of wealth, created by circumstances, to the benefit of society, instead of allowing it to become an unearned appendage to the riches of a particular class.

"Now this is actually the case with rent. The ordinary progress of a society which increases in wealth, is at all times tending to augment the incomes of landlords; to give them both a greater amount and a greater proportion of the wealth of the community, independently of any trouble or outlay incurred by themselves. They grow richer, as it were in their sleep, without working, risking, or economizing. What claim have they, on the general principle of social justice, to this accession of riches? In what would they have been wronged if society had, from the beginning, reserved the right of taxing the spontaneous increase of rent, to the highest amount required by financial exigencies?"

-- John Stuart Mill, Principles of Political Economy, Bk 5, Ch. 2

"As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed."

-- Adam Smith, The Wealth of Nations, Bk 1, Ch. 6

“Both ground-rents and the ordinary rent of land are a species of revenue which the owner, in many cases, enjoys without any care or attention of his own. Though a part of this revenue should be taken from him in order to defray the expenses of the state, no discouragement will thereby be given to any sort of industry....Ground-rents and the ordinary rent of land are, therefore, perhaps, the species of revenue which can best bear to have a peculiar tax imposed upon them."

-- Adam Smith, The Wealth of Nations, Bk 5, Ch. 2, Pt 1

"The value of labour-products is the measure of the service which their rightful owner has rendered to the community. The value of land is the measure of the service which the community is expected to render to the owners of land."

-- Max Hirsch, Democracy vs. Socialism, p. 348

Keep the above in mind while watching the following:


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Re: Landlordism creates "dependency"
« Reply #1 on: February 23, 2016, 11:51:22 AM »
Since there's a fundamental difference between capital and land, there is likewise a fundamental difference between capitalism and landlordism.

The original capitalists (Adam Smith and the French Physiocrats, the latter of whom coined the term "laissez faire") understood this self-evident truth.

Marxists were the first to blur the aforementioned distinction, and then Austrian School landlordists "capitalists" adopted that blurred distinction as their own.

Enthusiasm for Capitalism

by Harry Gunnison Brown

[Reprinted from the Henry George News, July 1958]

According to the Marxist-Leninist-Stalinist economic philosophy labor produces all that is produced, and income from property is "surplus value." Its adherents manifest little or no interest in differentiating between the capital which, by working and saving, men produce to aid them in further production and, on the other hand, natural resources, urban sites and tracts of land usable for agriculture, forestry and grazing.

There is, however, a philosophy that does distinguish between capital and land and between the incomes yielded by the one and by the other. Adherents of this philosophy stress the thought that, since man-made capital can come into existence only as there is work and saving, and since capital adds to the productiveness of industry, the private enjoyment of income from capital is a desirable -- and a deserved -- incentive to bringing capital into existence.

But they look with less kindly eyes on the private enjoyment of income from land, purely as such, and favor having an increasing amount of such income taxed into the public treasury. For the private enjoyment of such income appears, to adherents of this philosophy, as a requirement from landowners that others pay them for permission to use the earth. More specifically, they think of land rent as payment required by landowners of the payers for permission to work, live on, and draw subsoil deposits from, the earth or those parts of the earth which geological forces and community development have made relatively productive and livable.

Is there or is there not significant reason for distinguishing between the capital that, by working and saving, men produce to aid them in further production and, on the other hand, natural resources, sites and tracts? Is there, in short, good reason for distinguishing between capital and land?

Surely the rent of land is in a very peculiar sense socially produced rather than individually earned, and it ought to be sharply distinguished in thought from interest on capital produced by men's labor and saving. If there is any kind of return which is peculiarly fitted to be a source of public revenue, it is the rent of land.

Time was when the American Declaration of Independence and the struggle of the American states for freedom from political domination by Great Britain, stirred the imaginations of liberty-loving people in many other countries. Today we seek allies and sympathizers in our ideological struggle against the socialistically regimented countries of the Communist bloc. Will it help us in this ideological struggle -- will it stir enthusiasm for capitalism -- if in the "capitalism" that we practice and urge upon others, we include vast private income derived from charging (a) for permission to use -- and history might have been such as to make it so -- navigable lakes and streams, or (b) for permission -- and this is the way history really has made it -- to work on and to live on the earth?

Professor Henry E. Hoagland has stated that vacant lots are the largest single class of property in American cities. His statement is substantiated by a survey of eighty-six cities ranging In population from 900 to over 800,000, the results of which were published in 1955. The survey showed that approximately 43 per cent of the land area -- excluding streets and water areas -- was held vacant.

When land is held out of use speculatively or otherwise, rents which must be paid for apartments or homes and their sites become higher; thus the purchase price of land -- and homes -- increases. Wherever large amounts of land are vacant all public utility services become more expensive to install and maintain. If our taxes were shifted more largely to bare land and reduced or abolished on buildings and other capital, the building of apartment houses and other dwelling units would increase. Capital, because taxed less and thus yielding more, would flow in, causing rents to fall.

Without understanding the theory of land value taxation no economist can be expected to advise wisely regarding what tax policy is favorable to low-cost housing, slum clearance, industrial development or labor productivity. How shall we account, unless by the existence of an unfavorable intellectual climate among the economics professoriate, for the persistent ignoring, by most -- not, of course, quite all -- of our economists and their textbooks, of cause and effect relations so clear and so significant?

"Capitalism" is under heavy attack in a large part of the world. And the college graduates our economics professors have taught, are but poorly armed against the bombardments of communist and socialist ideology, when they can oppose the optimistically idealized programs of the "planners" with nothing better than the contemporary caricature of what capitalism could be at its possible best. Why have they not been shown the blueprint of a free private enterprise system which would be for many a college student, were it adequately explained to him, an acceptable societal goal and an inspiration to personal effort towards its realization?


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Re: Landlordism creates "dependency"
« Reply #2 on: February 23, 2016, 01:15:30 PM »


By Arthur J. Ogilvy


Suppose I own a sugar estate and 100 slaves, all the land about being held in the same way by people of the same class as myself.

It is a profitable business, but there are many expenses and annoyances attached to it.

I must keep up my supply of slaves either by buying or breeding them.

I must pay an overseer to keep them continually to their work with a lash. I must keep them in a state of brutish ignorance (to the detriment of their efficiency), for fear they should learn their rights and their power, and become dangerous.

I must tend them in sickness and when past work.

And the slaves have all the vices and defects that slavery engenders; they have no self-respect or moral sense; they lie, they steal, they are lazy, shirking work whenever they dare; they do not care what mischief their carelessness occasions me so long as it is not found out; their labor is obtained by force, and given grudgingly; they have no heart in it.

All these things worry me.

FLASH! ....

Suddenly a brilliant idea strikes me. I reflect that there is no unoccupied land in the neighbourhood, so that if my laborers were free they would still have to look to me for work somehow.

So one day I announce to them that they are all free, intimating at the same time I will be ready to employ as many as I may require on such terms as we may mutually and independently agree.

What could be fairer? They are overjoyed, and falling on their knees, bless me as their benefactor. Then they go away and have a jollification, and next day come back to me to arrange the new terms.


Most of them think they would like to have a piece of land and work it for themselves, and be their own masters. All they want is a few tools they have been accustomed to use, and some seed, and these they are ready to buy from me, undertaking to pay me with reasonable interest when the first crop comes in, offering the crop as security. As for their keep, they can easily earn that by working a few weeks on and off on any of the plantations, or by taking a job clearing or fencing, or such like. This will keep them going for the first year, and after that they will be better able to take care of themselves.


"But," softly I observe, "you are going too fast. Your proposals about the tools and seed and your maintenance are all right enough, but the land, you remember, belongs to me. You cannot expect me to give you your liberty and my own land for nothing. That would not be reasonable, would it?" They agree it would not, and begin to propose terms.

A fancies this bit of land, and B that. But it soon appears that I want this bit of land for my next year's clearing, and that for my cows, and another is too close to my house and would interfere with my privacy, and another is thick forest or swamps, and would require too long and costly preparation for me who must have quick returns in order to live, and in short that there is no land suitable that I care to part with.


Still I am ready to do what I promised — "to employ as many as I may require, on such terms as we may mutually and independently agree." But as I have now got to pay them wages instead of getting their work for nothing. I cannot of course employ all of them. I can find work for ninety of them, however, and with these I am prepared to discuss terms.

At once a number volunteered their services at such wages as their imagination had been picturing to them. I tell the ninety whose demands are most reasonable to stand on one side. The remaining ten look blank, and seeing that since I won't let them have any of the land, it is a question of hired employment or starvation, they offer to come for a little less than the others. I tell these now to stand aside, and ten others to stand out instead. These look blank now, and offer to work for less still, and so the "mutual and voluntary" settlement of terms proceeds.

But, meanwhile, I have been making a little calculation in my head, and have reckoned up what the cost of keeping a slave, with his food and clothes, and a trifle over to keep him contented, would come to, and I offer that.

They won't hear of it, but as I know they can't help themselves, I say nothing, and presently first one and then another gives in, till I have got my ninety, and still there are ten left out, and very blank indeed they look. Whereupon, the terms being settled, I graciously announce that though I don't really want any more men, still I am willing, in my benevolence, to take the ten, too, on the same terms, which they promptly accept, and again hail me as their benefactor, only not quite so rapturously as before.


So they all set to at the old work at the old place, and on the old terms, only a little differently administered; that is, that whereas I formerly supplied them with food, clothes, etc., direct from my stores, I now give them a weekly wage representing the value of those articles, which they will henceforth have to buy for themselves.

There is a difference, too, in some other respects, indicating a moral improvement in our relations. I can no longer curse and flog them. But then I don't want to; it's no longer necessary; the threat of dismissal is quite as effective, even more so; and much pleasanter for me.

I can no longer separate husband from wife, parent from child. But then again, I don't want to. There would be no profit in it; leaving them their wives and children has the double advantage of making them more contented with their lot, and giving me greater power over them, for they have now got to keep these wives and children out of their own earnings.

My men are now as eager as ever to come to me to work as they formerly were to run away from work. I have neither to buy or breed them; and if any suddenly leave me, instead of letting loose the bloodhounds, I have merely to hold up a finger or advertise, and I have plenty of others offering to take their place. I am saved the expense and worry of incessant watching and driving. I have no sick to attend, or worn-out pensioners to maintain. If a man falls ill there is nothing but my good nature to prevent my turning him off at once; the whole affair is a purely commercial transaction — so much wages for so much work. The patriarchal relation of slave-owner and slave is gone, and no other has taken its place. When the man is worn out with long service I can turn him out with a clear business conscience, knowing that the State will see that he does not starve.

Instead of being forced to keep my men in brutish ignorance, I find public schools established at other people's expense to stimulate their intelligence and improve their minds, to my great advantage, and their children compelled to attend these schools. The service I get, too, being now voluntarily rendered (or apparently so) is much improved in quality. In short, the arrangement pays me better in many ways.


But I gain in other ways besides pecuniary benefit. I have lost the stigma of being a slave driver, and have, acquired instead the character of a man of energy and enterprise, of justice and benevolence. I am a "large employer of labour," to whom the whole country, and the labourer especially, is greatly indebted, and people say, "See the power of capital! These poor labourers, having no capital, could not use the land if they had it, so this great and far-seeing man wisely refuses to let them have it, and keeps it all for himself, but by providing them with employment his capital saves them from pauperism, and enables him to build up the wealth of the country, and his own fortune together."

Whereas it is not my capital that does any of these things. lt is not my capital but the labourer's toil that builds up my fortune and the wealth of the country.

It is not my employment that keeps him from pauperism, but my monopoly of the land forcing him into my employment that keeps him on the brink of it. It is not want of capital that keeps the labourer from using the land, but my refusing him the use of the land that prevents him from acquiring capital. All the capital he wants to begin with is an axe and a spade, which a week's earnings would buy him, and for his maintenance during the first year, and at any subsequent time, he could work for me or for others, turnabout, with his work on his own land. Henceforth with every year his capital would grow of itself, and his independence with it, and that this is no fancy sketch, anyone can see for himself by taking a trip into the country, where he will find well-to-do farmers who began with nothing but a spade and an axe (so to speak) and worked their way up in the manner described.


But now another thought strikes me. Instead of paying an overseer to work these men for me, I will make him pay me for the privilege of doing it. I will let the land as it stands to him or to another — to whomsoever will give the most for the billet. He shall be called my tenant instead of my overseer, but the things he shall do for me are essentially the same, only done by contract instead of for yearly pay. He, not I, shall find all the capital, take all the risk, and engage and supervise the men, paying me a lump sum, called rent, out of the proceeds of their toil, and make what he can for himself out of the surplus.

The competition is as keen in its way for the land, among people of his class, as it is among the labourers for employment, only that as they are all possessed of some little means (else they could not compete) they are in no danger of immediate want, and can stand out for rather better terms than the labourers, who are forced by necessity to take what terms they can get.

The minimum in each case amounts practically to a "mere living", but the mere living they insist on is one of a rather higher standard than the labourers'; it means a rather more abundant supply and better quality of those little comforts which are next door to necessaries. It means, in short, a living of a kind to which people of that class are accustomed.

For a moderate reduction in my profits, then — a reduction equal to the tenant's narrow margin of profit — I have all the toil and worry of management taken off my hands, and the risk too, for be the season good or bad, the rent is bound to be forthcoming, and I can sell him up to the last rag if he fails of the full amount, no matter for what reason; and my rent takes precedence of all other debts.

All my capital is set free for investment elsewhere, and I am freed from the odium of a slave owner, notwithstanding that the men still toil for my enrichment as when they were slaves, and that I get more out of them than ever.

If I wax rich while they toil from hand to mouth, and in depressed seasons find it hard to get work at all; it is not, to all appearances, my doing, but merely the force of circumstances, the law of nature, the state of the labour market — fine sounding names that hide the ugly reality.

If wages are forced down it is not I that do it; it is that greedy and merciless man the employer (my tenant) who does it. I am a lofty and superior being, dwelling apart and above such sordid considerations. I would never dream of grinding these poor labourers, not I! I have nothing to do with them at all; I only want my rent -- and get it. Like the lilies of the field, I toil not, neither do I spin, and yet (so kind is Providence!) my daily bread (well buttered) comes to me of itself. Nay, people bid against each other for the privilege of finding it for me; and no one seems to realise that the comfortable income that falls to me like the refreshing dew is dew indeed; but it is the dew of sweat wrung from the labourers' toil. It is the fruit of their labour which they ought to have; which they would have if I did not take it from them.

This sketch illustrates the fact that chattel slavery is not the only nor even the worst form of bondage. When the use of the earth — the sole source of our daily bread — is denied unless one pays a fellow creature for permission to use it, people are bereft of economic freedom. The only way to regain that freedom is to collect the rent of land instead of taxes for the public domain.

Once upon a time, labour leaders in the USA, the UK and Australia understood these facts. The labour movements of those countries were filled with people who fought for the principles of 'the single tax' on land at the turn of the twentieth century. But since then, it has been ridiculed, and they have gradually yielded to the forces of privilege and power — captives of the current hegemony — daring no longer to come to grips with this fundamental question, lest they, too, become ridiculed.

And so the world continues to wallow in this particular ignorance — and in its ensuing poverty and debt.


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Re: Landlordism creates "dependency"
« Reply #3 on: February 23, 2016, 07:37:56 PM »
The first section, "THE SLAVER" describes perfectly the "job system". If you work for someone else for pay, you are their slave. Everyone who is willing, should strive to be the employer, rather than the employee.


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Re: Landlordism creates "dependency"
« Reply #4 on: March 10, 2016, 10:10:11 AM »
I like how the second video above, at 2:17, points out the similarity and common derivation of rent and taxes; i.e., the similarity of the landowner to government.