The Thoughts and Studies of G. Bernard Shaw: Personal Letters, Articles, Lectures & Essays. GEORGE BERNARD SHAW
steam engine, steel rollers, and all the latest contrivances for squashing wheat into dust instead of grinding it into flour; yet, after all his outlay, he will not be able to get a penny a sack more for his stuff than his competitor, to whose water-wheel Nature is gratuitously putting her shoulder. “Competition everywhere and always” of his unaided strength against that of his rival he might endure; but to fight naked against one armed with the winds and waves (for there are windmills as well as watermills) is no sound justice, though it be sound Anarchism. And how would occupying ownership of mines work, when it is an easier matter to get prime Wallsend and Silkstone out of one mine than to get slates and steam fuel out of another, even after twenty years’ preliminary shaft-sinking? Would Mr. Tucker, if he had on sale from a rich mine some Silkstone that had only cost half as much labor as steam coal from a relatively poor one, boldly announce:— “Prices this day: Prime Silkstone, per ton, 25s.; best steam ditto, 50s. Terms, cash. Principles, those of Adam Smith — see ‘Wealth of Nations’ passim”? Certainly not with “competition everywhere and always,” unless custom was no object to him in comparison with principle.
It is useless to multiply instances. There is only one country in which any square foot of land is as favorably situated for conducting exchanges, or as richly endowed by nature for production, as any other square foot; and the name of that country is Utopia. In Utopia alone, therefore, would occupying ownership be just. In England, America and other places, rashly created without consulting the Anarchists, Nature is all caprice and injustice in dealing with Labor. Here you scratch her with a spade; and earth’s increase and foison plenty are added to you. On the other side of the hedge twenty steam-diggers will not extort a turnip from her. Still less adapted to Anarchism than the fields and mines is the crowded city. The distributor flourishes where men love to congregate: his work is to bring commodities to men; but here the men bring themselves to the commodities. Remove your distributor a mile, and his carts and travellers must scour the country for customers. None know this better than the landlords. Up High Street, down Low Street, over the bridge and into Crow Street, the toilers may sweat equally for equal wages; but their product varies; and the ground rents vary with the product. Competition levels down the share kept by the worker as it levels up the hours of his labor; and the surplus, high or low according to the fertility of the soil or convenience of the site, goes as high rent or low rent, but always in the long run rack rent, to the owner of the land.
Now Mr. Tucker’s remedy for this is to make the occupier — the actual worker — the owner. Obviously the effect would be, not to abolish his advantage over his less favorably circumstanced competitors, but simply to authorize him to put it into his own pocket instead of handing it over to a landlord. He would then, it is true, be (as far as his place of business was concerned) a worker instead of an idler; but he would get more product as a manufacturer and more custom as a distributor than other equally industrious workers in worse situations. He could thus save faster than they, and retire from active service at an age when they would still have many years more work before them. His ownership of his place of business would of course lapse in favor of his successor the instant he retired. How would the rest of the community decide who was to be the successor — would they toss up for it, or fight for it, or would he be allowed to nominate his heir, in which case he would either nominate his son or sell his nomination for a large fine? Again, his retirement from his place of business would leave him still in possession, as occupying owner, of his private residence; and this might be of exceptional or even unique desirability in point of situation. It might, for instance, be built on Richmond Hill, and command from its windows the beautiful view of the Thames valley to be obtained from that spot. Now it is clear that Richmond Hill will not accommodate all the people who would rather live there than in the Essex marshes. It is easy to say, Let the occupier be the owner; but the question is, Who is to be the occupier? Suppose it were settled by drawing lots, what would prevent the winner from selling his privilege for its full (unearned) value under free exchange and omnipresent competition? To such problems as these, Individualist Anarchism offers no solution. It theorizes throughout on the assumption that one place in a country is as good as another.
Under a system of occupying ownership, rent would appear only in its primary form of an excess of the prices of articles over the expenses of producing them, thus enabling owners of superior land to get more for their products than cost price. If, for example, the worst land worth using were only one-third as productive as the best land, then the owner-occupiers of that best land would get in the market the labor cost of their wares three times over. This 200 per cent premium would be just as truly ground rent as if it were paid openly as such to the Duke of Bedford or the Astors. It may be asked why prices must go up to the expenses of production on the very worst land. Why not ascertain and charge the average cost of production taking good and bad land together? Simply because nothing short of the maximum labor cost would repay the owners of the worst land. In fact, the worst land would not be cultivated until the price had risen. The process would be as follows. Suppose the need of the population for wheat were satisfied by crops raised from the best available land only. Free competition in wheat-producing would then bring the price down to the labor cost or expenses of production. Now suppose an increase of population sufficient to overtax the wheat-supplying capacity of the best land. The supply falling short of the demand, the price of wheat would rise. When it had risen to the labor cost of production from land one degree inferior to the best, it would be worth while to cultivate that inferior land. When that new source came to be overtaxed by the still growing population, the price would rise again until it would repay the cost of raising wheat from land yet lower in fertility than the second grade. But these descents would in nowise diminish the fertility of the best land, from which wheat could be raised as cheaply as before, in spite of the rise in the price, which would apply to all the wheat in the market, no matter where raised. That is, the holders of the best land would gain a premium, rising steadily with the increase of population, exactly as the landlord now enjoys a steadily rising rent. As the agricultural industry is in this respect typical of all industries, it will be seen now that the price does not rise because worse land is brought into cultivation, but that worse land is brought into cultivation by the rise of price. Or, to put it in another way, the price of the commodity does not rise because more labor has been devoted to its production, but more labor is devoted to its production because the price has risen. Commodities, in fact, have a price before they are produced; we produce them expressly to obtain that price; and we cannot alter it by merely spending more or less labor on them. It is natural for the laborer to insist that labor ought to be the measure of price, and that the just wage of labor is its average product; but the first lesson he has to learn in economics is that labor is not and never can be the measure of price under a competitive system. Not until the progress of Socialism replaces competitive production and distribution, with individual greed for its incentive, by Collectivist production and distribution, with fair play all round for its incentive, will the prices either of labor or commodities represent their just value.
Thus we see that “competition everywhere and always” fails to circumvent rent whilst the land is held by competing occupiers who are protected in the individual ownership of what they can raise from their several holdings. And “the great principle laid down by Adam Smith,” formulated by Josiah Warren as “Cost is the proper limit of price,” turns out — since in fact price is the limit of cost — to be merely a preposterous way of expressing the fact that under Anarchism that small fraction of the general wealth which was produced under the least favorable circumstances would at least fetch its cost, whilst all the rest would fetch a premium which would be nothing but privately appropriated rent with an Anarchist mask on.
We see also that such a phrase as “the natural wage of labor is its product” is a misleading one, since labor cannot produce subsistence except when exercised upon natural materials and aided by natural forces external to man. And when it is so produced, its value in exchange depends in nowise on the share taken by labor in its production, but solely to the demand for it in society. The economic problem of Socialism is the just distribution of the premium given to certain portions of the general product by the action of demand. As Individualist Anarchism not only fails to distribute these, but deliberately permits their private appropriation, Individualist Anarchism is the negation of Socialism, and is, in fact, Unsocialism carried as near to its logical completeness as any sane man dare carry it.