Economic Harmonies

Adam Smith: “In agriculture, too, Nature labours along with man; and
though her labour costs no expense, its produce has
nonetheless its value, as well as that of the most expensive workmen.”
*81

Here, then, we have Nature producing
value. And he who would purchase wheat must pay for this value, although it has not cost anybody anything, even in terms of labor. Who will dare step forward to claim this so-called
value? But for this word “value” substitute “utility,” and all becomes clear, and private property is vindicated and justice satisfied.

This rent may be considered as the produce
of those powers of Nature, the use of which the landlord lends to the farmer….. It [the rent!]
is the work of Nature, which remains after deducting or compensating
everything that can be regarded as the work of man. It is seldom less than a fourth and often more than a third of the whole produce. No equal quantity of productive labour employed in manufactures can ever occasion so great a reproduction. In them Nature does nothing; man does all…..
*82

Is it possible to assemble a greater number of dangerous errors in fewer words? On this reckoning, a fourth or a third of the
value of food products must be attributed
exclusively to the powers of Nature. And yet the landowner charges the tenant, and the tenant the proletarian, for this so-called value, which remains after payment is made for
the work of man. And it is on this basis that you propose to justify the right to property! What, then, do you propose to do with the axiom:
All value comes from labor?

Furthermore, we have the assertion that Nature
does nothing in manufactures! So gravitation, volatile gases, animals do not aid the manufacturer! These forces do the same thing in the factories that they do on the land; they produce gratis, not value, but utility. Otherwise property in capital goods would be as much exposed to communist attacks as landed property.

Buchanan,
*83 in his comment, while accepting the theory of the master on rent, is led by the logic of the facts to criticize him for declaring it advantageous.

Smith, in regarding as
advantageous to society that portion of the soil’s produce which represents profit on farm land [what language!] does not reflect that rent is only the effect of high price, and what the landlord gains in this way he gains only at the expense of the consumer. Society gains nothing by the reproduction of profit on land. It is one class profiting at the expense of the others.
*84

Here we find the logical deduction: rent is injustice.

Ricardo: “Rent is that portion of the produce of the earth
which is paid to the landlord for possessing the right to exploit
the productive and indestructible powers of the soil.”*85

And, in order that there be no mistake, the author adds:

Rent is often confounded with the interest and profit of capital….. It is evident that a portion only of the money …. represents the interest of the capital which had been employed in improving the land, and in erecting such buildings as were necessary, etc.; the
rest is paid for the use of the original and indestructible powers of the soil. In the future pages of this work, then, whenever I speak of the rent of land, I wish to be understood as speaking of that compensation which the farmer pays to the owner of the land for the use of
the original and indestructible powers of the soil.

McCulloch:
*86 “What is properly termed Rent is the sum paid for
the use of the natural and inherent powers of the soil. It is entirely distinct from the sum paid for the use of buildings, enclosures, roads, or other improvements.
Rent is, then, always a monopoly.”

Scrope: “The value of land and its power of yielding Rent are due to two circumstances: first, the appropriation of
its natural powers; second, the labor applied to its improvement.”

The conclusion is not long in coming:

“Under the first of these relations
rent is a monopoly. It restricts the usufruct of the gifts that God has given to men for the satisfaction of their wants. This restriction
is just only in so far as it is necessary for the common good.”

How great must be the perplexity of those good souls who refuse to admit that anything can be necessary which is not just!

Scrope concludes with these words:

“When it goes beyond this point, it must be modified on the same principle that caused it to be established.”

The reader cannot fail to perceive that these authors have led us to the denial of the right to property, and have done so very logically by starting with this proposition: The landowner exacts payment for the gifts of God. Hence, land rent is an injustice that has been legalized under the pressure of necessity; it can be modified or abolished as other necessities dictate. This is what the communists have always said.

Senior: “The instruments of production are labour and natural agents. Natural agents having been appropriated, proprietors
charge for their use under the form of Rent, which is the recompense of no sacrifice whatever, and is received by those who have neither laboured nor put by, but who merely hold out their hands to accept the offerings of the rest of the community.”

Having dealt property this heavy blow, Senior explains that a portion of rent corresponds to interest on capital, and then adds:

The surplus is taken by the
proprietor of the natural agent, and is his reward, not for having laboured or abstained, but simply for not having withheld when he was able to withhold; for having permitted the gifts of Nature to be accepted.

We see that this is still the same theory. The landowner is presumed to come between the hungry and the food God had intended for them, provided they were willing to work. The owner, who had a share in its production, charges for this labor, as is just, and then he charges a second time for Nature’s labor, for the productive forces, for the indestructible powers of the soil, which is unjust.

We are sorry to find this theory, developed by John Stuart Mill, Malthus,
et al., also gaining acceptance on the Continent.

“When one franc’s worth of seed,” says Scialoja, “yields one hundred franc’s worth of wheat, this great increase in value is due in large part to the land.”
*87

This is confusing utility with value. One might as well say: When water, which costs only a sou ten yards from the spring, costs ten sous at a hundred yards, this increase in value is due in large part to the help of Nature.

Florez Estrada:
*88 “Rent is that part of the product of agriculture which is left
after all the costs of its production have been met.”

Hence, the landowner receives something for nothing.

All the English economists begin by asserting this principle:
Value comes from labor. They are therefore merely inconsistent when they thereupon attribute
value to forces contained in the soil.

The French economists, for the most part, assign value to utility; but, since they confuse gratuitous utility with onerous utility, the harm they do property is equally great.

Jean-Baptiste Say:

The land is not the only natural agent that is productive; but it is the only one, or almost the only one, that man has been able to appropriate. The waters of the sea and of the rivers, in being able to turn the wheels of our machines, to provide us with fish, to float our ships, likewise have productive power. The wind and even the sun’s rays work for us; but,
fortunately, no one has yet been able to say: The wind and the sun belong to me, and I must be paid for the service they render.

Say apparently deplores the fact that anyone can say: The land belongs to me, and I must be paid for its service.
Fortunately, I maintain, the landowner can no more charge for the services of the land than for the wind’s or the sun’s.

The earth is a wondrous chemical workshop wherein many materials and elements are mixed together and worked on, and finally come forth as grain, fruit, flax, etc. Nature has presented this vast workshop to man as a
gratuitous gift, and has divided it into many compartments suitable for many different kinds of production. But certain men have come forth, have laid hands on these things, and have declared: This compartment belongs to me; that one also; all that comes from it will be my exclusive property. And, amazingly enough,
this usurpation of privilege, far from being disastrous to society, has turned out to be advantageous.

Of course, the arrangement has proved advantageous! And why? Because it is neither privilege nor usurpation; because the one who said, “This compartment is mine,” could not add, “What comes from it will be my exclusive property,” but instead, “What comes from it will be the exclusive property of anyone wishing to buy it, paying me in return for the pains I take, or that I spare him; what Nature did for me without charge will be without charge to him also.”

Say, I beg the reader to note, distinguishes in the value of wheat the shares that belong, respectively, to property, to capital, and to labor. With the best of intentions he goes to great pains to justify this first portion of payment which goes to the landowner and which is not charged against any previous or present labor. But he fails, for, like Scrope, he falls back on the weakest and least satisfactory of all available arguments:
necessity.

If it is impossible for production to be carried on not only without land and capital, but also without these means of production becoming
property, can we not say that their owners perform a productive function, since without it production could not be carried on? It is, indeed, a convenient function, although in the present state of society it requires an accumulation of capital goods from previous production or savings, etc.

The confusion here is obvious. For the landowner to be a capitalist, there must be an accumulation of capital goods—a fact that is neither questioned nor to the point. But what Say looks on as “convenient” is the role of the landowner as such, as someone charging for the gifts of God. This is the role that must be justified, and it entails neither accumulation nor savings.

If, therefore, property in land and in capital goods [why associate things that are different?] is created by production, I can fittingly liken property to a machine that works and produces while its owner stands idly by, charging for its hire.

Still the same confusion. The man who has made a machine owns
capital goods, from which he derives legitimate payment, because he charges, not for the work of the machine, but for the labor he himself has performed in making it. But the
soil, which is
landed property, is not
the product of human labor. On what grounds is a charge made for what it does? The author has here lumped together two different types of property in order to persuade us to exonerate the one for the same reasons that we exonerate the other.

Blanqui:
*89

The farmer who plows, fertilizes, sows, and harvests his field, provides labor without which there would be nothing to reap. But the action of the land in germinating the seed, and of the sun in ripening the crop, are independent of this labor and co-operate with it to form the
value represented by the harvest….. Smith and many other economists have asserted that human labor is the only source of value. This is certainly not the case. The farmer’s industry is not the only thing that creates the
value in a sack of wheat or a bushel of potatoes. His skill will never be so great as to produce germination, any more than the alchemist’s patience has discovered the secret of making gold. This is obvious.

It is impossible to confuse more completely, first, utility with value, and, secondly, gratuitous utility with onerous utility.

Joseph Garnier:
*90

Rent paid to the landowner is fundamentally different from the payments made to the workman for his labor or to the entrepreneur as profit on the outlays made by him, in that these two types of payment represent compensation, to the one for pains taken, to the other for sacrifices or risks he has borne, whereas the landowner receives rent more
gratuitously and
merely by virtue of a legal convention that guarantees to certain individuals the right to landed property.
**32

In other words, the workman and the entrepreneur are paid, in the name of justice, for services that they render; the landowner is paid, in the name of the law, for services that he does not render.

The most daring innovators do nothing more than propose to replace private ownership by collective ownership…..
They have reason on their side, it seems to me, as regards human rights; but, practically speaking, they are wrong until such time as they can demonstrate the advantages of a better economic system…..
**33

But for a long time to come, even though admitting that
property is a privilege and a monopoly, we must add that it is a useful and natural monopoly…..

In short, it is apparently admitted by political economists [alas! yes, and herein lies the evil] that property does not stem from divine rights, or rights of demesne, or from any other theoretical rights, but simply from its practical advantages.
It is merely a monopoly that is tolerated in the interest of all, etc.

This is the identical judgment passed by Scrope and repeated by Say in milder terms.

I believe that I have sufficiently proved that the economists, having started from the false assumption that
the forces of Nature possess or create value, went on to the conclusion that private property (in so far as it appropriates and charges for this value that is independent of all human services) is a privilege, a monopoly, a usurpation, but a necessary privilege that must be maintained.

It remains for me to show that the socialists start from the same assumption but change their conclusion to this: Private property is a necessary privilege; it must be maintained,
but we must require the property owner to furnish compensation in the form of a guarantee of employment for those who are without property.

After this, I shall summon the communists, who declare, still arguing from the same premise: Private property is a privilege; it must be abolished.

And finally, at the risk of repeating myself, I shall close by refuting, if possible, the common premise from which all three conclusions are derived:
The forces of Nature possess or create value. If I succeed, if I demonstrate that the forces of Nature, even when converted into property, do not create value, but utility, which is passed on by the owner in its entirety, reaching the consumer without charge, then economists, socialists, communists will all have to agree to leave the world, in this respect, as it is.

M. Considérant writes:
**34

In order to see how and under what conditions
private property can appear and develop legitimately, we must understand the
fundamental Principle of Property rights: Every man OWNS LEGITIMATELY THE THING
which his labor, his intelligence, or, more generally, HIS ACTIVITY HAS CREATED.

This principle is incontestable, and it is well to note that implicitly it recognizes the right of all men to the land. In fact, since the land was not created by men, it ensues from the fundamental Principle of Property that the land, the common fund presented to the species, can in no wise be legitimately the absolute and exclusive property of any particular individuals who have not created
this value. Let us then formulate the true Theory of Property, establishing it exclusively on the unassailable principle which bases the
Legitimacy of Property on the fact of the CREATION
of a thing or of the value possessed by it. In order to do this, let us consider the creation of Industry, that is, the origin and development of agriculture, manufacture, the arts, etc., in human society.

Let us imagine that on the land of a remote island, on the soil of a nation, or over the whole earth (the area of the theater of operations changes in no way the significance of the facts), one generation of mankind devotes itself for the first time to industry, that is, for the first time it farms, manufactures, etc. Each generation, by its labor, by its intelligence, by its own industry,
creates commodities, develops values, that did not previously exist on the unimproved land. Is it not perfectly evident that in this first industrial generation the possession of Property will be in conformity with Justice, IF
the value and wealth produced by the industry of all is distributed among their producers IN PROPORTION TO THE CONTRIBUTION of each one to the creation of the general wealth? This is incontestable.

Now, the results of this labor fall into two categories that must be carefully distinguished.

The
first category includes those things coming from the soil that belonged to the first generation by right of use: products increased, refined, or manufactured by the labor and industry of this generation. These products, finished or unfinished, consist either of consumers’ goods or of tools of production. It is clear that the products are fully and legitimately the property of those who by their industry have created them. Each one of these persons has, therefore, the right either to consume them immediately or to put them away to be disposed of according to his subsequent convenience, whether it be to use them, exchange them, or give them away or transfer them to whomsoever desired, without need of authorization from anyone. According to this hypothesis, this property is obviously legitimate, respectable, sacred. It cannot be attacked without attacking
Justice, Right, and individual Liberty—in a word, without committing an act of plunder.

Second category. But not all the things created by the industrial activity of this first generation fall into the above category. Not only has this generation created the products that we have just designated (consumers’ goods and tools of production), but it has also added an
additional value to the original value of the soil by cultivating it, building upon it, and adding permanent improvements.

This additional value obviously constitutes a product, a value, due to the first generation’s industry. Now, if, by some means or other (we are not concerned here with the question of means), the ownership of this extra value is distributed equitably, that is, in proportion to each one’s labor in creating it, each one of these persons will possess
legitimately the portion that falls to him. He will therefore be able to dispose of this legitimate private property as he sees fit, exchanging it, giving it away, transferring it, without any of the other individuals, in other words, society, ever having any right or authority whatsoever over these values.

We can understand perfectly well, therefore, that, when the second generation comes along, it will find upon the land capital of two different types:

A.
Original or Natural Capital, which has not been created by men of the first generation—that is, the
value of the unimproved land.

B.
Capital Created by the first generation, including: first, the
products, goods, and implements that have not been consumed or worn out by the first generation; second, the extra value that the labor of the first generation may have added to
the value of the unimproved land.

It is therefore evident, and the clear and necessary consequence of the basic Principle of Property Rights, which has just been established, that every individual of the second generation has equal rights to the
Original or Natural Capital, whereas he has no right to the other capital, the
Capital Created by the labor of the first generation. Every individual member of this first generation can therefore dispose of his share of the
Created Capital in favor of any person or persons of the second generation he chooses—children, friends, etc.—without any individual or even the State itself, as we have just said, having any claim (in the name of Property Rights) over such disposal made by the donor or testator.

Let us note that, following our hypothesis, a member of the second generation is already favored over a member of the first generation because, in addition to rights to the
Original Capital, which have been preserved for him, he may be fortunate enough to receive a share of the Created Capital, that is, value that has been produced not by him, but by previous labor.

9.89

Let us assume that Society is so constituted:

1. That the Rights to
Original Capital, that is, to the resources of the land in its unimproved form, are preserved or that EQUIVALENT RIGHTS are recognized for every person born into this world in any age whatsoever.

2. That
Created Capital is continually distributed among men
as rapidly as it is created, in proportion to each person’s participation in its creation.

9.90

If the machinery of the social order meets these two conditions, PROPERTY, in such a regime, would be established under conditions of ABSOLUTE JUSTICE.
Fact and
ideal would then be in complete accord.
**35

9.91

We note that our socialist author makes a distinction here between two kinds of value:
created value, which can legitimately be converted into property, and
noncreated value, also called the
value of unimproved land, original capital, natural capital, which can become private property only by an act of usurpation. Now, according to the theory that I advance, the ideas expressed by the words “noncreated,” “original,” “natural,” completely exclude the ideas of
value and
capital. This is the error in the premise that leads M. Considérant to the following melancholy conclusion:

9.92

Under the System by which Property is established in all civilized nations, the common fund, to whose complete enjoyment all humanity has full rights, has been raided: it is now taken over by a small minority, to the exclusion of the great majority. And truly, if only one man were in fact deprived of his rights to the enjoyment of the common fund, this one exclusion would in itself be a sufficient violation of Justice to brand the system of Property that sanctioned it as unjust and illegitimate.

9.93

Yet M. Considérant acknowledges that the land cannot be cultivated except under the system of private property. This is
necessary monopoly. How can all these things be reconciled, and the rights of the proletariat to original, natural, noncreated capital, or the value of the unimproved land, be protected?

9.94

Very well, let an industrial Society, which has taken over the possession of the Land and has deprived man of the faculty of exercising freely and at will his four natural Rights; let such a Society, I say, grant the individual as reparation for the Rights that it has taken away, the RIGHT TO EMPLOYMENT.

9.95

If anything in the world is clear, it is that this theory, except for the conclusion, is exactly the one held by the economists. The person buying a farm product pays for three things: (1) current labor (nothing more legitimate); (2) the
additional value imparted to the soil by previous labor (still completely legitimate); (3) finally,
original capital or
natural or
noncreated capital, the gratuitous gift of God, called by Considérant the
value of the unimproved land; by Smith, the
indestructible powers of the soil; by Ricardo, the
productive and indestructible powers of the land; by Say,
natural agents. This is what has been
usurped, according to M. Considérant; this is what has been
usurped, asserts Jean-Baptiste Say. This is what constitutes
injustice and
plunder in the eyes of the socialists; this is what constitutes
monopoly and
privilege in the eyes of the economists. They are further agreed as to the
necessity, the usefulness, of this arrangement. Without it, the land would not produce, say the disciples of Smith; without it, we should return to the savage state, say the disciples of Fourier.

9.96

We see that in theory, at least as regards the great question of equity, there is much more of an
entente cordiale between the two schools than might be imagined. They are divided only in regard to the conclusions to be drawn from the fact on which they agree and in regard to the legislative action to be taken. “Since property is tainted with injustice, inasmuch as it assigns to the landowners remuneration that is not their just due, and since, on the other hand, it is necessary, let us respect it but exact reparations from it.”

9.97

“No,” say the economists, “although it is a monopoly, let us respect it, since it is necessary, and leave it alone.” Yet they offer even this feeble defense very half-heartedly, for one of their most recent spokesmen, M. Garnier, adds: “You are correct from the point of view of human rights, but you are wrong from the practical standpoint, until you can show what could be done by a better system.”

9.98

To which the socialists do not fail to reply: “We have found it. It is the right to employment. Let us try it.”

9.99

At this juncture M. Proudhon arrives on the scene. Do you imagine, perhaps, that this celebrated contradictor is going to contradict the fundamental premise of the socialists and the economists? Not at all. He has no need to do so in order to demolish the principle of property. On the contrary: he seizes hold of this premise; he embraces it; he presses it to his bosom, and squeezes from it its most logical conclusion. “Aha,” he says, “you admit that the gifts of God have not only utility but
value; you admit that the landowners usurp them and sell them. Therefore, property is theft. Therefore, it is not necessary to maintain it or to exact reparations from it, but to
abolish it.”

9.100

M. Proudhon has mustered many arguments against landed property. The one that carries the most weight, the only one that carries any weight, is the one furnished him by those authors who have confused utility with value.

9.101

“Who has the right,” he asks,

to charge for the use of the soil, for wealth that was not made by man? To whom is due the rent on the land? To the producer of the land, of course. Who made it? God. In that case, landlord, you may withdraw.

…. But the Creator of the earth does not sell it. He gives it away without charge; and He gives to all alike. How, then, is it that among His children some are treated as eldest sons and others as bastards? How does it happen, if originally man’s right was equality of inheritance, that it has posthumously become inequality of status?

9.102

Replying to Jean-Baptiste Say, who has compared the land to a tool of production, he says:

9.103

I agree that the land is a tool of production; but who wields it? Is it the landowner? Is he the one who by the magic of property rights imparts to it strength and fertility? His monopoly consists of just this, that, though he has not made the implement, he charges for the service it performs. Let its Maker appear and demand His rent, and we will settle with Him; or else let the landowner, who claims to have full title, produce his power of attorney from the Maker.

9.104

Evidently these three systems are in fact only one. Economists, socialists, egalitarians, all direct the
same reproach against landed property, that of charging for something that it has no right to charge for. Some call this abuse
monopoly; others,
injustice; and still others,
theft. These are merely different degrees of guilt in the same bill of complaint.

9.105

Now, I appeal to the attentive reader: Is this complaint well-grounded? Have I not demonstrated that only one thing stands between God’s gifts and human hunger, viz., human service?

9.106

Economists, you declare: “Rent is what is paid to the landowner for the use of the productive and indestructible powers of the soil.”

9.107

I answer: No. Rent is what is paid the water carrier for the pains he took to make his cart and his wheels, and the water would cost more if he carried it on his back. In the same manner, wheat, flax, wool, wood, meat, fruit would cost us more if the landowner had not improved the instrument that produces them.

9.108

Socialists, you say: “Originally the masses enjoyed their right to the land subject to their labor. Now they are excluded and robbed of their natural heritage.”

9.109

I reply: No, they are not excluded or robbed; they do enjoy gratis the utility that the land has produced, subject to their labor, that is, on condition that they pay by their own labor those who spare them labor.

9.110

Egalitarians, you say: “The monopoly of the landowner consists in the fact that, while he did not make the means of production, he charges for its service.”

9.111

I answer: No, the land as a means of production, in so far as it is the work of God, produces
utility, and this utility is gratuitous; it is not within the owner’s power to charge for it. The land, as a means of production, in so far as the landowner has prepared it, worked on it, enclosed it, drained it, improved it, added other necessary implements to it, produces
value, which represents human
services made available, and this is the only thing he charges for. Either you must recognize the justice of this demand, or you must reject your own principle of
reciprocal services.

9.112

In order to learn what the real elements are that constitute the value of the land, let us observe how landed property is created, not through violence or conquest, but according to the laws of labor and exchange. Let us observe what conditions are like in this respect in the United States.

9.113

Brother Jonathan, an industrious water carrier in New York, left for the Far West, carrying in his wallet a thousand dollars, the fruit of his labor and thrift.

9.114

He passed through many fertile areas in which the soil, the sun, and the rain perform their miracles, yet, in the economic and
practical sense, impart
no value to them.

9.115

As he was something of a philosopher, he kept saying as he went along: “In spite of all that Smith and Ricardo say, value must be something else than the
productive, natural, and indestructible power of the soil.“

9.116

Finally, he reached the State of Arkansas and saw before him a beautiful farm of about a hundred acres, which the government had put up for sale at a dollar an acre.

9.117

“A dollar an acre!” he said to himself. “That’s very little, so little, in fact, that it’s almost nothing. I’ll buy this land, clear it, sell my crops, and, instead of being a water carrier as I once was, I too shall be a landowner!”

9.118

Brother Jonathan, who was a ruthlessly logical man, liked to have a reason for everything. He said to himself: “But why is this land worth even a dollar an acre? No one has ever laid a hand on it. It is virgin territory. Could Smith, Ricardo, and all the rest of the theorists down to Proudhon, possibly be right? Could it be that the land does have value independently of any labor, service, or other human intervention? Must it be admitted that the productive and indestructible powers of the soil are
worth something? Why, then, are they not
valuable in the areas I have just been through? And, besides, since these marvelous powers are so far superior to man’s capacity, which will never be able to duplicate the phenomenon of growth, as M. Blanqui has so profoundly observed, why, then, are they
worth only a dollar?”

9.119

But he was not long in realizing that this value, like all values, is an entirely human and social creation. The American Government did indeed ask the price of a dollar an acre, but, on the other hand, it guaranteed, at least to a certain degree, the safety of the purchaser; it had constructed a road of sorts in the vicinity; it had arranged for the delivery of letters and papers; etc.

9.120

“Service for service,” said Jonathan. “The government charges me a dollar, but it fully renders me the equivalent. Henceforth, begging Ricardo’s pardon, I shall explain the value of this land in human terms, and its value would be even greater if the highway were nearer, the mail service more convenient, my safety more assured.”

9.121

While discoursing thus, Jonathan kept on working; for, in all fairness to him, it must be said that he was a doer as well as a thinker.

9.122

After he had invested the rest of his dollars in buildings, fences, clearings, trenchings, drainage, preparations, etc., after he had dug, plowed, harrowed, sowed, and harvested, came the moment for selling the crop. “Now at last I’ll know,” cried Jonathan, still obsessed with the problem of value, “whether in becoming a landowner I have turned into a monopolist, a privileged aristocrat, a despoiler of my fellow men, or a usurper of the divine bounty.”

9.123

So he took his grain to market and held converse with a Yankee: “My friend,” he said, “how much will you give me for this corn?”

9.124

“The current price,” said the other.

9.125

“The current price? But will that give me something beyond the interest on my investment and the compensation for my labor?”

9.126

“I’m a merchant,” said the Yankee, “and I have to be satisfied with payment for my past and present labor.”

9.127

“And I was satisfied with that when I was a water carrier,” replied Jonathan; “but now I’m an owner of landed property. The English and French economists have assured me that in that capacity, I should receive, in addition to payment for my past and present labor, a profit from the
productive and indestructible powers of the soil. I should levy a special tribute on the gifts of God.”

9.128

“The gifts of God belong to everyone,” said the merchant. “I certainly use the
productive power of the wind to sail my ships, but I don’t charge for it.”

9.129

“And I propose that you pay me something for these powers, so that Messrs. Senior, Considérant, and Proudhon will not for naught have called me a monopolist and a usurper. If I am to bear the shame, I should at least have the profit.”

9.130

“In that case, my friend, I bid you farewell; I’ll appeal to other landowners for my corn, and if I find that they feel as you do, I’ll grow some for myself.”

9.131

Thus, Jonathan learned that, under a system of liberty, not everyone who will may become a monopolist. “As long as there is land to be cleared in the Union,” he said to himself, “I shall be only the one who puts these famous
natural and indestructible forces to work. I shall be paid for the pains I take and nothing more, exactly as in the old days, when, as a water carrier, I was paid for the pains I took and not for those that Nature took. I see clearly that the one who enjoys the gifts of God is not the man who raises the grain, but the one who consumes it.”

9.132

After several years Jonathan became interested in another venture and looked around for a tenant for his farm. The conversation between the two parties was very interesting and would shed much light on the question if I were to quote it in its entirety.

9.133

But we must be content with the following excerpt:

9.134

Jonathan: What! You don’t want to pay me as rent anything more than the interest, at the current rate, on my capital outlay?

9.135

The tenant: Not a penny more.

9.136

Jonathan: And why, if you please?

9.137

The tenant: Because for that amount of capital I can put another farm in exactly the same condition as yours.

9.138

Jonathan: That seems to be a conclusive argument. But consider that, when you begin to farm my land, you will have not only my capital but also the
natural and indestructible powers of the soil working for you. You will have at your disposal the marvelous effects of the sun and the moon, of natural affinity and electricity. Must I let you have all these for nothing?

9.139

The tenant: Why not, since you paid nothing for them, and derive nothing from them, any more than I shall?

9.140

Jonathan: Derive nothing from them? Goodness gracious, what do you mean? I derive everything from them. Without these wonderful phenomena all my industry wouldn’t raise a single blade of grass.

9.141

The tenant: Of course. But remember the Yankee. He refused to give you a penny for all this help of Nature, just as the New York housewives refused to give you anything for the admirable process by which Nature feeds the spring.

9.142

Jonathan: But Ricardo and Proudhon …..

9.143

The tenant: What do I care about Ricardo? Let us deal on the terms I have laid down, or else I
shall go and clear some land beside yours. The sun and the moon will work for me there for nothing.

9.144

It was the same old argument, and Jonathan began to understand that God has taken rather wise precautions so that His gifts should not be easily intercepted.

9.145

Having somewhat lost his taste for being a landowner, Jonathan decided to direct his energies elsewhere. He determined to put his farm up for
sale.

9.146

Needless to say, no one was willing to give him more than he had himself paid. Despite his citation of Ricardo and his allusions to the so-called value inherent in the indestructible powers of the soil, everyone gave him the same answer: “There are other farms besides yours.” And these few words silenced his demands even as they destroyed his illusions.

9.147

In this transaction there was, indeed, a fact of great economic importance that has not been sufficiently noted.

9.148

Everyone realizes that if a manufacturer wished, after ten or fifteen years, to sell his equipment, even if it were as good as new, the probability is that he would be compelled to suffer a loss. The reason is simple: Ten or fifteen years rarely go by without bringing some mechanical progress. For that reason the person who puts a fifteen-year-old piece of machinery up for sale can hardly expect to be paid for all the work that went into it; because now, thanks to progress, better machines can be obtained for the same amount of labor—and this, let me say in passing, is further proof that value is proportional, not to labor, but to service.

9.149

Hence, we can conclude that it is in the nature of tools of production to lose some of their value through the mere action of time, independently of any wear and tear, and we may express this fact in the following proposition:
One of the effects of progress is to decrease the value of existing tools of production.

9.150

It is clear, of course, that the more rapid the progress, the greater the difficulty of existing implements in keeping pace with new ones.

9.151

I shall not stop here to point out the harmonies suggested by this law. All that I wish to call attention to is the fact that landed property is no exception to it.

9.152

Brother Jonathan made this discovery to his personal sorrow and loss. He had this conversation with his prospective buyer:

9.153

“The permanent improvements I have put into this land represent a thousand days of labor. I propose, first, that you pay me the equivalent of these thousand days, and then something additional for the inherent value of the soil, which is independent of any human labor.”

9.154

The buyer answered:

9.155

“In the first place, I shall give you nothing for the value of the soil itself, since this is merely utility, which is as abundant in the surrounding farms as in yours. So, as far as this inherent, extrahuman utility goes, I can get it gratis, which proves that it has no value.

9.156

“In the second place, for the thousand days’ labor that your accounts show you put into bringing your land to its present condition, I will give you eight hundred, and my reason is that today for eight hundred days’ labor I can do on adjoining land what you in the past did on yours in a thousand days. Please bear in mind that in the past fifteen years progress has been made in draining, clearing, building, digging wells, constructing stables, and providing transportation. For every job less labor is needed, and I have no desire to pay you ten for what I can get for eight, especially since the price of grain has gone down proportionately, which is not to your profit or mine, but to that of all mankind.”

9.157

Thus, Jonathan had no choice but to keep his land or sell at a loss.

9.158

Of course, the value of land is not subject to any one single circumstance. Other factors, like the construction of a canal or the founding of a town, can cause a rise in its value. But the factor that I have mentioned, progress, always works in the direction of a fall in its value.

9.159

The conclusion to be drawn from the foregoing observations is this: As long as there is in a country an abundance of land still to be cleared, the landowner, whether he farms it himself, rents it, or sells it, enjoys no privilege, no monopoly, no exceptional advantage, and, most notably, reaps no special windfall from the bounty of Nature. How could he, assuming that men are free? Does not everyone having any capital and the strength of his hands possess the right to follow the calling of his choice—agriculture, manufacturing, commerce, fishing, navigation, the arts, or the professions? And would not men with capital and capacity turn more eagerly toward the careers that offered exceptional returns? And would they not desert those likely to entail losses? Is not this inevitable distribution of human energies sufficient, granted our hypothesis, to maintain in equilibrium the returns yielded in all branches of enterprise? In the United States do we see farmers making their fortunes any more rapidly than businessmen, shipowners, bankers, or doctors, as would inevitably happen if they received both payment for their own labor and also, over and beyond what others receive, a payment, as has been alleged, for the incalculable labor of Nature?

9.160

Very well, then, do you really want to know how, even in the United States, a landowner could set up a monopoly for himself? I shall try to explain.

9.161

Let us imagine that Jonathan assembles all the landowners in the Union and speaks to them thus:

9.162

“I have tried to sell my crops, and I haven’t been able to find anyone willing to give me a high enough price for them. I have tried to rent my land, and no one will meet my terms. I have tried to sell it and have met with the same disappointment. My demands have uniformly been cut short with the same answer:
There is other land nearby. The result is, unfortunately, that my services in the community are rated, like those of everyone else,
at what they are worth, despite all the sweet-sounding promises of the theorists. I am allotted nothing, absolutely nothing, for this productive and indestructible power of the soil, for those forces of Nature, solar and lunar radiations, rain, wind, dew, frost, which I believed were my property, but which, in reality, I own in name only. Is it not an iniquitous thing that I am paid only for my services, and even then only at the rate to which it has pleased my competitors to lower them? You all suffer from this same oppression; you are all victims of anarchistic competition. Things would not be in this state, as you can readily understand, if we were to
organize landed property, if we were to act concertedly to prevent anyone from hereafter clearing a square inch of American soil. Then, when the population, because of its growth, would be clamoring for the limited supply of food to be had, we would be in a position to set our own prices and make great fortunes, which, in turn, would be a great boon to the other classes, for, being rich, we would provide them with employment.”

9.163

If, on hearing this discourse, the united landlords seized control of the legislature and enacted a statute forbidding all further clearing of the land, they undoubtedly would, for a time, increase their profits. I say, for a time, because the natural laws of society would be lacking in harmony if the punishment did not spring from the crime itself. Out of respect for scientific accuracy, I shall not say that the new statute would impart value to the power of the soil or to the forces of Nature (if that were the case, the statute would work to the harm of no one); but I shall say: The balance of services would be violently upset; one class would exploit the other classes; a system of slavery would be introduced into the country.

9.164

Let us move on to another hypothesis, which, in fact, represents actual conditions in the civilized nations of Europe, where the land has already become private property.

9.165

We must now consider whether, in this case too, the great mass of consumers, or the
community, continues to enjoy gratis the productive power of the soil and the forces of Nature; whether the holders of the land are owners of anything beyond its
value, that is, of their honest services evaluated according to the laws of competition; and whether, when they charge for their services, they are not forced, like everybody else, to include gratis the gifts of God.

9.166

Suppose, then, the whole territory of Arkansas has been sold by the government, divided into private estates, and put under cultivation. When Jonathan offers his grain or even his land for sale, does he vaunt the productive power of the soil and try to include it as part of the land’s value? He can no longer be stopped short, as in the previous case, by the crushing retort: “There are uncleared lands adjoining yours.”

9.167

The new situation implies that the population has grown. It is divided into two classes: (1) the class that supplies the community with agricultural services; (2) the class that supplies industrial, intellectual, or other services.

9.168

What follows seems to me quite evident. Provided the workers (other than the landowners) who wish to get grain are perfectly free to appeal to Jonathan or to his neighbors or to landowners in neighboring States or even to clear uncultivated land outside of Arkansas, it is absolutely impossible for Jonathan to force an unjust law upon them. The mere existence somewhere of land without value is an insuperable barrier to privilege, and therefore this hypothetical case is the same as our preceding one: Agricultural services are subject to the law of general competition, and it is utterly impossible to charge more for them than they are
worth. Let me add that they are worth no more
(ceteris paribus) than services of any other kind. Just as the manufacturer, after charging for his time, his pains, his trouble, his risks, his outlay, his skill (all of which constitute human service and are represented by value), can charge nothing for the law of gravitation or the expansibility of steam, of whose aid he has availed himself; so Jonathan can reckon as the aggregate value of his grain only the sum total of his services, past and present, and can include nothing at all for the help he has received from the laws of vegetation. The balance of services is not impaired as long as they are freely exchanged on the market at a mutually agreeable price, and the gifts of God that transmit these services are exchanged gratis along with the services and stay in the communal domain.

9.169

It will undoubtedly be pointed out that, as a matter of fact, the value of the soil increases steadily. This is true. As the population increases and becomes richer, as the means of transportation improve, the landowner receives a better price for his services. Is this a special law applicable only to him, or does it not rather apply to all producers? For an equal amount of labor does not a doctor, a lawyer, a singer, a painter, or a day laborer obtain more satisfactions in the nineteenth century than in the fourth, in Paris than in Brittany, in France than in Morocco? But this increase in satisfaction is not obtained at anyone’s expense. This much needs to be understood at least. Further discussion must wait until we analyze this law of the value (used here metonymically) of the soil in another part of this work when we reach Ricardo’s theory.
**36

9.170

For the present, it is enough to note that Jonathan, under the conditions of this hypothesis, cannot oppress the industrial classes, provided the exchange of services is free, and that labor may, without any legal restraint, be distributed in Arkansas or elsewhere among all types of production. This freedom stands in the way of landowners who would divert to their profit the gratuitous benefits of Nature.

9.171

This would no longer be the case, however, if Jonathan and his colleagues took over the legislature and prohibited or hampered the freedom of exchange—if, for example, they decreed that not a kernel of foreign wheat could enter the territory of Arkansas. In that case the value of the services exchanged between landowners and nonlandowners would no longer be determined by justice. The nonlandowners would have no protection against the demands of the landowners. Such legislation would be as iniquitous as the other measure we just referred to. The effect would be precisely the same as if Jonathan, having offered for sale a sack of wheat that would otherwise sell for fifteen francs, drew a pistol from his pocket, pointed it at the buyer, and said, “Give me three francs more, or I will blow your brains out.”

9.172

This procedure (which we must call by its right name) is
extortion. Whether it be by the exercise of
private force or by
law, it does not change in character. If by the exercise of private force, as in the case of the pistol, it is an act against property. If by law, as in the case of the ban, it is still an act against property, and beyond that, a denial of the right to property. As we have seen, one has property rights only over values, and value is the estimation of two services that are freely exchanged. Hence, it is not possible to conceive of anything more antagonistic to the fundamental right to property than an alteration, effected in the name of the law, in the equivalence of exchanged services.

9.173

It is perhaps not idle to point out that laws of this nature are iniquitous and disastrous, whatever may be the opinion of either oppressed or oppressor toward them. In some countries we see the working classes clamoring for such restraints because they bring wealth to the landowners. They do not perceive that it is at their expense, and, as I know by experience, it is not always prudent to tell them so.

9.174

It is indeed strange. The common people listen eagerly to the zealots who preach communism, which is slavery, since not to be master of one’s own services is slavery; and yet they disdain those who on all occasions defend liberty, which is the common sharing of God’s bounty to man.

9.175

We now reach the third hypothetical case, wherein the entire arable surface of the globe has become private property.

9.176

Here again we observe two classes: those who possess the soil and those who do not. Will those of the first class be able to oppress the members of the second? And will the second not be forever reduced to offering more and more labor for the same quantity of food?

9.177

If I answer this objection, it will be, obviously, for the sake of scientific completeness, for we are still hundreds of centuries away from the time when such a hypothesis could become a reality.

9.178

But the fact is that everything indicates that the time must come when the landowners’ claims cannot be kept within bounds by the magic words: There is more land to be cleared.

9.179

I beg the reader to note that this hypothesis also implies that at that time the population will have reached the extreme limit of the earth’s ability to provide sustenance.

9.180

This adds a new and important element to the question. It is almost as if I were asked: What will happen when there is not enough air left to fill all the extra lungs in the world?

9.181

Whatever theory we may hold on the problem of population, it is at least certain that the population can
increase, and even that it
tends to increase, since it does increase. The entire economic organization of society is such that it appears to anticipate this trend, with which it is in complete harmony. The landowner always hopes to charge for the use of the natural resources he has at his command, but he is always disappointed in his foolish and unjust demands by the great supply of similar natural resources that do not pass through his hands. Nature’s relatively infinite prodigality with her forces keeps him from being anything more than a mere custodian over some of them. Now, what will happen when men will have reached the limits of this bounty? It will no longer be possible for anything more to be hoped for in that direction. Inevitably the trend toward increased population will then come to a halt. No economic system can prevent this from necessarily happening. In the hypothetical case we are considering, any increase in population would be checked by a corresponding rise in the death rate. No proponent of human betterment, however optimistic, can go so far as to assert that the number of human beings can continue to rise when there is no possible chance for a further increase in the supply of food.

9.182

Here, then, is a new order; and the laws of the social world would not be harmonious if they had not provided for this contingency, so different from the conditions under which we live today.

9.183

The difficulty we foresee can be illustrated in this manner: Imagine a ship in the middle of the ocean with a month to go before reaching land and with only enough food for two weeks. What must be done? Obviously each sailor’s ration must be reduced. This is not being hardhearted; it is merely being prudent and just.

9.184

Similarly, when the population is extended to the extreme limit of what the earth, with all possible land under cultivation, can support, there will be nothing harsh or unjust about the law that takes the gentlest and most effective means of preventing further multiplication of the species. And once again the solution can be found in the principle of the private ownership of the land. The owner of landed property, under the spur of personal interest, will make the soil produce the most food of which it is capable. By the division of inheritances private ownership of land will make every family aware of the dangers of a rising birth rate. It is very clear that under any other system—communism, for example—there would be no equally strong incentive for greater production nor so firm a brake on increasing population.

9.185

In the final analysis, it seems to me that the political economists will have performed their task when they prove that the great and just law of the
reciprocity of services works harmoniously as long as further progress is not ruled out for mankind. Is it not reassuring to reflect that, until that time and so long as liberty prevails, it is impossible for one class to oppress another? Are the economists obliged to answer this other question: Granted the tendency of the race to multiply, what will happen when there is no more room on the earth for new inhabitants? Is God holding back, for that epoch, some cataclysm of creation, some marvelous manifestation of His infinite power? Or, in keeping with Christian dogma, must we believe in the destruction of this world? Obviously these are no longer economic problems, but are analogous to the difficulties eventually reached by all sciences. The physicists are well aware that every moving body on earth goes downward and never rises again. Accordingly, the day must come when the mountains will have filled the valleys, when rivers will be as high at their mouth as at their source, when their waters will no longer flow, etc., etc. What will happen then? Should the physical sciences cease to observe and admire the harmony of the world as it now is, because they cannot foresee by what other harmony God will make provision for a state of things that is far in the future but nonetheless inevitable? It seems to me that this is indeed a case in which the economist, like the physicist, should respond by an act of faith, not by an act of idle curiosity. He who has so marvelously arranged the abode where we now dwell will surely be able to prepare a different one for different circumstances.

9.186

We judge the soil’s fertility and man’s skill by the facts that we observe. Is this a reasonable rule to follow? Then, adopting it, we could say: Since it has required six thousand years for a tenth of the surface of the globe to attain a sorry kind of agriculture, how many hundreds of centuries will elapse before its entire surface is turned into a great garden?

9.187

Even in this evaluation, already quite reassuring, we are merely making a supposition based on a scientific generalization, or rather, on our present state of agricultural ignorance. But, I repeat, is this an acceptable rule to follow; and does not analogy suggest that the true potentialities of this art, which are perhaps infinite, are beyond our present knowledge? The savage lives by hunting, and he requires five square miles of land. How great would be his surprise to learn that a pastoral people can support more than ten times that number in the same space! The nomadic shepherd, in turn, would be amazed to learn that ordinary agriculture would permit of a population ten times greater. Tell a peasant accustomed to this method that another tenfold increase would be possible by crop rotation, and he would not believe you. And is the rotation of crops, which is the last word for us, also the last word for the human race? Let us, therefore, stop worrying about the fate of mankind. Thousands of centuries lie ahead of it; and in any case, without asking political economists to settle problems that are out of their field, let us confidently leave the fate of future generations in the hands of Him who will call them into existence.

---

9.188

Let us summarize the central ideas of this chapter.

9.189

The two phenomena, utility and value, the contribution of Nature and the contribution of man, consequently communal wealth and private property, are to be found in agricultural enterprises as in all others.

9.190

In the production of the wheat that satisfies our hunger, something takes place that is quite analogous to the production of the water that quenches our thirst. Does not the sea, which inspires the poet, also stir us, the economists, to fruitful meditation? It is a vast reservoir intended to give drink to all human creatures. Yet they are so far removed from its cooling waters, which, worse still, are filled with brine! But the marvelous resourcefulness of Nature comes to the rescue. The sun warms and stirs this mass and subjects it to slow evaporation. It turns to vapor, and, freed from its salt, which rendered it unsuitable for use, rises to the upper regions of the air. Winds, moving in from all directions, waft it toward the inhabited continents, where the cold congeals it and attaches it in solid form to the mountainside. Soon the warmth of springtime melts it. Its weight carries it down the slopes, and, as it flows through beds of schist and gravel, it is filtered and purified; it spreads out in all directions, feeding the refreshing springs in all parts of the world. This is certainly an immense and ingenious industrial project that Nature carries out for the benefit of mankind. Conversion of materials from one form to another, transportation from one place to another, creation of utility—all the elements of industry are there. Yet where is
value? It has not yet been created, and if the so-called labor of God could be charged for (and it would be charged for if it had
value), who could say what a single drop of water
would be worth?

9.191

Yet all men do not have a spring of living water flowing at their feet. To quench their thirst they must still go to some pains, make some effort, practice foresight, employ their skill. It is this supplementary human labor that gives rise to arrangements, transactions,
evaluations. In it, then, we find the origin and the basis of value.

9.192

With man, ignorance comes before knowledge. Originally, therefore, he was reduced to going after the water he drank and to doing, with a maximum of pains, such additional work as Nature had left him to do. This was the period in the development of exchange when water had its greatest
value. Little by little he invented the cart and the wheel, he trained horses, he devised pipes, he discovered the laws of the siphon; in a word, he put part of the burden of his labor on the gratuitous forces of Nature, and proportionally the value of the water, but not its utility, decreased.

9.193

And, in this process, something takes place that must be carefully noted and understood if we are to avoid seeing discord where there is actually harmony. The purchaser of the water obtains it on better terms; that is, he exchanges a smaller amount of his labor for any given amount of water at each step along the path of progress, even though, in this case, he is obliged to pay for the instrument by means of which Nature is put to work. Formerly he paid for the labor of going after the water; now he pays for this labor and also for the labor it took to construct the cart, the wheel, and the pipe. And yet,
everything included, he pays less. This illustration shows how unfortunate and erroneous is the bias of those who believe that the compensation paid to capital represents an added burden to the consumer. Will these people never realize that capital, in any given case, eliminates more labor than it demands as payment?

9.194

The process that has just been described applies equally well to the production of wheat. In it too there exists, antedating human industry, a tremendous, immeasurable industry of Nature, much of which even yet is not understood by the most advanced scientific thinking. Gases and minerals are present in the soil and in the atmosphere. Electricity, chemical forces, wind, rain, light, heat, life are all successively busy, often without our knowledge, transporting, transforming, collecting, dividing, combining these elements; and this wonderful industry, whose activity and utility surpass our understanding and even our imagination, possesses no value. The latter makes its appearance at the first intervention of man, who, in this case, has more
supplementary labor to perform than in the other.

9.195

In order to direct these forces of Nature, to remove the obstacles that hinder their action, man takes possession of an instrument, which is the soil, and he does so without harming anyone, for this instrument has no value. This is not a debatable matter, but a simple fact. Show me, in any part of the world whatsoever, a piece of land that has not directly or indirectly been the object of man’s activity, and I will show you a piece of land totally lacking in value.

9.196

Yet the farmer, in order to produce wheat, with the help of Nature, performs two very distinct types of labor. One type is directly related to the yearly harvest, is related to it alone, and must be paid for by it alone: things like planting, weeding, harvesting, transplanting. The other, like constructing farm buildings, providing drainage, clearing, fencing, etc., spans an indefinite number of successive harvests; this cost must be distributed over a series of years, a process that is carried out accurately by the admirable device that we call the laws of interest and amortization. The crops furnish the farmer’s payment if he consumes them himself. If he exchanges them, he receives in return services of a different type, and the appraisal of the services so exchanged constitutes their value.

9.197

Now, it is easy to understand that all this long-range labor that the farmer performs on the soil represents a
value that has not yet been paid for, but that surely will be. He cannot be forced to relinquish it and to allow another person to take over his right to it without compensation. Value has been incorporated, implanted in the soil; for that reason we may well say, by metonymy:
The soil has value. It has value, in fact, because no one may now acquire it without offering in exchange the equivalent of this labor. But I maintain that this land, to which Nature’s productive power had not originally communicated any value, still does not possess any value the more on that account. This power of Nature, which was gratis, is still gratis, and always will be. We may indeed say: This land
has value; but what really has value is the human labor that has improved it, the capital that has been expended on it. Consequently, it is completely accurate to say that its owner is, strictly speaking, owner only of the value that he has created, of the services that he has rendered. And what ownership could be more legitimate? It has not been created at anyone’s expense; it neither intercepts nor lays a tax on any gift of heaven.

9.198

Nor is this all. The capital outlay and the interest on it, which must be spread over successive harvests, far from increasing costs and becoming an extra burden for the consumers, enables them to obtain agricultural products on better and better terms in proportion as the amount of capital increases, that is, as the value of the soil is enhanced. I have no doubt that this assertion will be taken for an overly optimistic paradox, so accustomed are people to looking on the value of the soil as a calamity, if not an injustice. Yet I declare that it is not enough to say that the value of the soil has been created at no one’s expense, or to say that it is harmful to no one; it must be stated that, on the contrary, it is to the profit of all. It is not merely legitimate; it is advantageous, even to those who are not landowners.

9.199

So here again we have the same phenomenon we just witnessed in regard to drinking water. As we said, as soon as the water carrier invented the cart and the wheel, it is quite true that the consumer was forced to pay for two types of labor instead of one: (1) the labor of making the cart or the wheel, or rather the interest and amortization on this capital outlay; (2) the actual labor that the water carrier was still required to perform. But it is equally true that these two types of labor together do not equal the total amount of labor of one type only that mankind was previously required to perform. Why is this true? Because, thanks to the invention of these mechanical aids, a part of the work has been turned over to the gratuitous forces of Nature. Indeed, it was the prospect of decreased toil that prompted the invention and brought about its adoption.

9.200

Exactly the same phenomena are to be observed in the case of land and wheat. Unquestionably, every time the landowner invests capital in permanent improvements, the succeeding crops must be charged with the interest on this capital. But it is equally certain that the amount of labor belonging to the other category, that of unskilled labor that must be performed annually, is also reduced in far greater proportions; so that the landowner, and hence the consumer, obtains each succeeding crop for less and less effort, it being the special characteristic of capital to substitute the gratuitous action of Nature for man’s labor, which must be paid for.

9.201

Consider the following example: To produce the best crops, a field must be cleared of excessive moisture. Let us suppose that labor for this has not progressed beyond the first, or unskilled, category. Let us assume that the farmer must go out every morning with a pail to drain off water standing in spots where it would do harm. It is evident that at the end of the year this act will not have added any
value to the soil, but the price of the crop will have been tremendously increased. So will all the prices of all succeeding crops, as long as the science of agriculture does not advance beyond this primitive procedure. But if the farmer digs a ditch, the soil immediately acquires
value, for this work belongs to the second category. Such work becomes a part of the soil; it must be paid for by the crops of succeeding years, and no one can expect to acquire the land without paying also for this operation. But is it not true that it nevertheless tends to reduce the value of the crops? Is it not true that, although it required, during the first year, an unusual expenditure of effort, it saves in the long run more than it occasions? Is it not true that henceforth the drainage will be carried out more economically through the application of the laws of hydraulics than it was previously by dint of physical labor? Is it not true that the purchasers of the wheat will profit from the operation? Will they not have reason to deem themselves fortunate that the soil has acquired this new value? And, to generalize, is it not true, then, that the value given the soil is a sign of progress, which is to the benefit not of the owner alone, but of all mankind? How absurd, then, it would be of mankind, and how hostile to its own best interests, to say: The amount added to the price of the wheat for interest and amortization on this ditch, or for what it represents in the total value of the soil, is a privilege, a monopoly, a theft! Reasoning in this wise, the owner, in order to be no longer a thief or a monopolist, would only have to fill in his ditch and go back to the pail. Would you who do not own land be any better off for that?

9.202

Enumerate all the permanent improvements that together make up the value of the soil, and you can make the same observation for each one of them. After you destroy the ditch, destroy the fences too, forcing the owner to go back to standing guard on his field; destroy the well, the barn, the road, the plow, the grading, the artificial mould; put back into it the stories, the weeds, the tree roots, and then you will have achieved utopian equality. The soil, and the human race along with it, will have returned to its original state: it will no longer have value. The crops will no longer be burdened with capital. Their price will be free of that cursed element called interest. Everything, absolutely everything, will be done by current labor, visible to the naked eye. Political economy will be greatly simplified. France will support one man for every five square miles of land. All the others will have starved to death; but it can no longer be said: Property is a monopoly; it is an injustice; it is theft.

9.203

Let us not, therefore, be insensible to those economic harmonies that pass before our eyes as we analyze the concepts of exchange, value, capital, interest, private property, public ownership. Need I present the entire cycle? But perhaps we have gone far enough to realize that the social world, no less than the material world, bears the impress of the divine hand, from which come wisdom and loving-kindness, and toward which we should raise our eyes in awe and gratitude.

9.204

I cannot refrain from returning to a remark of M. Considérant.

9.205

Taking as his premise the idea that the soil has value in itself, independent of man’s activity, that it is
original and noncreated capital, he concludes, logically from his premise, that
to convert it into private property is to usurp it. This supposed iniquity moves him to declaim vehemently against modern society. On the other hand, he agrees that permanent improvements add an
extra value to this original capital, as an additional element so completely fused with the rest as to be inseparable. What, then, is to be done? For we are confronted with a total value composed of two parts, one of which, having been produced by labor, is legitimate property, and the other, being the creation of God, is an iniquitous usurpation.

9.206

This is no small dilemma. M. Considérant solves it by the
right to employment.

9.207

Humanity’s progress on Earth obviously demands that the land not be left in a wild and uncultivated state. Our very Destiny, as Human Beings, therefore, is opposed to the idea that man’s Right to the Earth should retain its
rude and original FORM.

9.208

In his forests and savannas the savage enjoys his four natural Rights of Hunting, Fishing, Gathering wild fruits, and Grazing. Such is the original form of his Rights.

9.209

In all civilized societies, the man of the common people, the Proletarian, is purely and simply despoiled of these rights. We cannot, therefore, say that his original Rights have changed form, since they no longer exist. The form has disappeared along with the Substance.

9.210

Now, what would be the form under which his Rights could be reconciled with the conditions of an industrial Society? The answer is simple.

9.211

In the savage state man, to enjoy his Rights, is
obliged to act. The
Labor of Fishing, Hunting, Gathering, and Grazing is the condition placed upon the exercise of his Rights. His original Rights, therefore, are simply his
Right to perform these labors.

9.212

Very well, then, since an industrial Society has taken possession of the Earth, and prevents men from exercising on the soil freely and at will their four natural Rights, let this Society grant to them, in compensation for the Rights it takes away, the RIGHT TO EMPLOYMENT: then, if principle and practice are properly understood and carried out, the individual will have no grounds for complaint.

9.213

The indispensable prerequisite for the Legality of Property is, therefore, that Society recognize the Common Man’s RIGHT TO EMPLOYMENT, and that it
guarantee him for a given amount of his activity at least as much in the way of subsistence as a similar amount of activity
would have brought him in his original state of savagery.

9.214

I do not propose to argue the point in all its ramifications with M. Considérant, for I should become insufferably repetitious in the process. If I proved to him that what he calls
noncreated capital is not capital at all; that what he terms the
additional value of the soil is not
additional value, but
total value; he would have to admit that his whole argument breaks down, and with it all his complaints against the manner in which humanity has seen fit to organize itself and to live since the time of Adam. But this controversy would oblige me to restate what I have already said concerning the fact that the forces of Nature remain inherently and unalterably gratuitous. I shall confine myself to observing that if M. Considérant is the spokesman for the working classes, he does them such a disservice that they may well consider that they have been betrayed. He says that the landowners have usurped both the land and all the miracles of vegetation that take place on it. They have usurped the sun, the rain, the dew, oxygen, hydrogen, and nitrogen—at least to the extent that these contribute to the raising of agricultural products—and he asks them to assure the worker, as compensation, at least as much in the way of subsistence for a given amount of activity as a similar amount of activity would have brought him in the original or savage state.

9.215

But do you not perceive, M. Considérant, that landed property has not waited for you to issue your injunctions, that it has already been a million times more generous? For, after all, what does your proposal actually come to?

9.216

In the original state of savagery, your four rights of fishing, hunting, gathering wild fruits, and grazing supported—or rather, allowed to eke out an existence in all the horrors of privation—approximately one man per five square miles. The usurpation of the land will therefore be deemed legitimate, according to your theories, if the guilty parties support one man per five square miles, with the further requirement that he exert himself as greatly as a Huron or an Iroquois must. Please note that the area of France is only thirty thousand square leagues; that, consequently, provided it support thirty thousand inhabitants in that state of material well-being afforded by a life of savagery, you are content to ask nothing more, on behalf of the workers, from the owners of property. Now, this leaves thirty million Frenchmen who do not have a square inch of land; and among that number there are quite a few—the President of the Republic, cabinet ministers, magistrates, bankers, businessmen, notaries, lawyers, doctors, brokers, soldiers, sailors, teachers, journalists, etc.—who would surely not be disposed to change their way of life for that of an Iowa Indian. Landed property must, therefore, already do a great deal more than you require. You demand from it a right to employment that, within certain fixed limits, and only in return for a certain amount of effort, will provide the masses with a level of subsistence equal to that which a state of savagery could offer them. The system of landed property does much better than that. It offers more than the right to employment; it offers actual employment, and if it did no more than meet the taxes it now pays, that figure is still a hundred times more than you would demand.

9.217

Alas! I am sorry to say that I have not yet finished with landed property and its value. I still have to state, and refute in as few words as possible, a plausible and even significant objection.

9.218

People will say:

9.219

“The facts belie your theory. Undoubtedly, as long as there exists in a country a large amount of uncultivated land, its mere presence will prevent cultivated land from acquiring exorbitant value. Undoubtedly, also, even when all the land has been converted into private property, if adjoining nations have great tracts yet to be tilled, the right of free bargaining will hold the value of landed property within just limits. In these two cases land prices would not seem to represent more than the capital outlay, and rent more than the interest on it. From these facts one must conclude, as you do, that what is done by the soil itself and by the forces of Nature, since it does not figure in the costs and cannot be added to the price of crops, does remain gratis and therefore common to all. All this is plausible. We may well be at a loss to discover the flaw in this line of reasoning, and yet it is fallacious. To be convinced that this is so, we have only to note the fact that in France there is cultivated land ranging in price from a hundred to six thousand francs an acre, an enormous difference, which is to be explained more by reason of the variations in fertility than in previous improvements. Do not deny, therefore, that fertility has its own inherent value; every bill of sale attests to this fact. Anyone buying a piece of land determines its quality and pays accordingly. If two fields are placed side by side and have the same advantages of location, but differ in their soil, the one consisting of rich loam and the other of barren sand, surely the first will be worth more than the second, even though the same capital improvements have been made on both. And, in fact, this is a point about which the buyer is not at all concerned. His eyes are turned toward the future, not the past. He is interested, not in what the land has cost, but in what it will yield, and he knows that its yield will be in proportion to its fertility. Therefore, this fertility has its own specific, intrinsic value, which is independent of any human labor performed on it. To maintain the contrary is to attempt to find the justification for private property in ingenious quibblings, or rather in a paradox.”

9.220

Let us, therefore, investigate what really gives value to the soil.

9.221

I ask the reader to remember that at the present time this question is a most vital one. Previously it could be either dismissed or treated superficially by economists, as a question of little more than passing interest. The legitimacy of private property was not then contested. Such is no longer the case. New theories, which have been only too successful, have cast doubt among even the best minds regarding the right to property. And on what do the authors of these theories base their complaint? On just the allegation contained in the objection I have presented above. On just this fact, which unfortunately has gained acceptance by all schools of thought, that the soil derives from its fertility, from Nature, an inherent value that has not been transmitted to it by any human agency. Now, value is not transferred gratis. Its very name excludes the idea that it is gratuitous. Therefore, we say to the landowner: You demand from me a value that is the fruit of my labor, and you offer me in exchange another value that is the fruit neither of your labor nor of anyone’s labor, but of Nature’s bounty.

9.222

And, make no mistake about it, this indictment would be a terrible one if it were based on fact. It did not originate with Messrs. Considérant and Proudhon. It is to be found in Smith, in Ricardo, in Senior, in all the economists without exception, not merely as a theory, but as an indictment. These authors have not stopped at attributing an extrahuman value to the soil; they have gone so far as to deduce clearly the consequences of this theory and to brand landed property as a privilege, a monopoly, a usurpation. To be sure, after thus blasting it, they have defended it in the name of
necessity. But is such a defense anything more than a flaw in reasoning, which the logicians of communism have been quick to set right?

9.223

It is, therefore, not for the sake of yielding to an unfortunate proclivity for quibbling that I take up this delicate subject. I should have preferred to spare the reader and myself the tediousness that even now I feel is gathering over the final pages of this chapter.

9.224

The answer to the objection that I have just presented is to be found in my theory of value, which is set forth in chapter 5. There I stated: Value does not necessarily imply labor; even less is it necessarily proportional to labor. I showed that value is based less on the
pains taken by the one who surrenders what is exchanged than on the
pains spared the recipient, and for that reason I attributed it to something that includes both elements:
service. A great service can be rendered, I said, at the cost of very little effort, and a very minor service can be rendered with great effort. The only result, then, is that labor does not
necessarily receive a remuneration that is always proportional to its intensity, either in the case of the man living in isolation or in that of the man living in society.

9.225

Value is determined after bargaining between two contracting parties. Each one brings to the bargaining his own point of view. You offer me wheat. Of what importance to me are the time and trouble it may have cost you? What I am concerned about is the time and trouble it would cost me to obtain it elsewhere. The knowledge you have of my situation may make you more or less demanding; the knowledge I have of yours may make me more or less ready to come to terms. Hence, there can be no necessary measure of the payment you are to receive for your labor. That depends on circumstances and the value they give to the two services being exchanged. Soon we shall take up an external factor, called competition, whose function it is to regularize values and to make them correspond more and more closely to effort. Yet this correspondence is not of the essence of value, since it is established only under the pressure of a contingent fact.

9.226

Keeping this in mind, I can say that the value of the soil is created, fluctuates, is set, like that of gold, iron, water, an attorney’s advice, a doctor’s consultation, the performance of a singer or of a dancer, or an artist’s painting—like all values; that it obeys no special laws; that it constitutes property that is of the same origin, the same nature, and is as legitimate as any other property. But it does not at all follow—this must be clear by now—that, of two efforts applied to the soil, one may not be better remunerated than the other.

9.227

Let us revert to that most simple of all industries, the one best fitted to illustrate the tenuous dividing line between man’s onerous labor and Nature’s gratuitous collaboration. I refer to the humble labor of the water carrier.

9.228

A man fills a barrel with water and brings it home. Does he own a value that necessarily is proportional to his labor? In that case the value would be distinct from the service that the water can render. Furthermore, it could not fluctuate, for labor that has once been performed is not susceptible of increase or diminution.

9.229

Very well, then, the very day after the water barrel has been filled and delivered, it can lose all its value, if, for example, it rains during the night. In that case, everybody has his supply of water; the barrel of water can render no service; it is no longer wanted. In the language of economics, there is no demand for it.

9.230

On the other hand, it can acquire considerable value if exceptional, unforeseen, and urgent demand arises.

9.231

The result is that man, working with the future in mind, can never know in advance exactly what that future holds in store for his labor. The value incorporated in a material object will be greater or less according to the services it will render; or, rather, human labor, the source of this value, will receive, according to circumstances, a greater or a smaller remuneration. Such eventualities fall within the domain of foresight, and foresight, too, is entitled to its reward.

9.232

But, I ask, what do these fluctuations of value, the variations in the price paid labor, have to do with Nature’s marvelous industrial achievement, with the wonderful laws of physics that, without help from us, transport the waters we drink from the ocean to the spring? Because the value of this barrel of water varies according to circumstances, must we conclude that Nature sometimes charges a great deal, sometimes very little, and sometimes not at all, for evaporation, for the transportation of clouds from the sea to the mountains, for freezing, for melting, and all the wonderful industrial activity that feeds the spring?

9.233

The same is true of agricultural products.

9.234

The value of the soil, or rather of the capital invested in the soil, is composed not of one element, but of two elements. It depends not only on the labor that has gone into the soil but also on society’s capacity to reward that labor, on demand as well as on supply.

9.235

Take the case of a field. Not a year goes by in which some work of a permanent nature is not done on it, and, by the same token, its value is enhanced.

9.236

Furthermore, new roads are built, and others are improved; law enforcement becomes more efficient; new markets are opened up; there are increases in population and in wealth; new careers are opened to intelligence and skill; and these changes in the physical environment and the general prosperity result in additional remuneration for labor past and present, and, concomitantly, greater value for the field.

9.237

In all this there is neither injustice nor special privilege for the landowner. Every line of work from banking to manual labor presents the same phenomenon. Each one finds its own remuneration enhanced through the mere fact of improvement in the surroundings in which it is carried on. This action and reaction of the prosperity of each one on the prosperity of all, and vice versa, is the very law of value. How completely erroneous it is to conclude from this evidence that the soil or its productive forces have a so-called value of their own can be seen from the fact that in intellectual work, in the professions and occupations in which material things and physical laws play no part, the same benefits are enjoyed. This is not exceptional, but the universal experience. The lawyer, the doctor, the teacher, the artist, the poet, are better paid, for the work they do, in proportion as their city or nation increases in prosperity, as the taste or the demand for their services grows, as the general public is both willing and able to remunerate them better. The simple sale of a doctor’s or a lawyer’s practice or of the good will of a business concern is carried out on this principle. Even the Basque Giant and Tom Thumb, who make their living by the mere display of their abnormal stature, exhibit themselves to their greater profit before the curious throngs of well-to-do city dwellers than before a few poor villagers. In this case demand does not merely contribute to value; it creates it entirely. Why should we feel that it is exceptional or unjust for demand also to have an influence on the value of land and of agricultural products?

9.238

Will it be alleged that the value of land can thereby rise exorbitantly? Those who say so have certainly never considered the enormous amount of labor that has gone into arable land. I venture to state that there is not a field in France that is
worth as much as it cost, that can be exchanged for as great an amount of labor as has actually been expended on it to bring it to its present state of productivity. If this statement is well founded, it is conclusive. It does not permit of the least hint of injustice being charged against the principle of landed property. Therefore, I shall come back to this subject when I have occasion to consider Ricardo’s theory of rent. I shall show that we must apply also to capital invested in land the general law that I have formulated in these terms: In proportion as capital increases, what it produces is distributed among the capitalists or landowners and the workers in such a way that the former’s
relative share constantly decreases, although their
absolute share increases, while the latter’s share increases in both respects.

9.239

The illusion that leads men to believe that productive forces have a value of their own because they have utility, has been responsible for many miscalculations and catastrophes. It has often involved them in premature efforts at colonization whose history reads like a lamentable chronicle of martyrs. They reasoned thus: In our country, we can acquire value only through labor; and when we work, we receive value only in proportion to our labor. If we went to Guiana, to the banks of the Mississippi, to Australia, or Africa, we could take possession of vast stretches of land, uncultivated, to be sure, but fertile. Our reward would be that we should become the owners both of the value that we should create and of the
intrinsic value that is to be found in this land.

9.240

They set out, and harsh reality is not slow in confirming the truth of my theory. They work; they clear the land; they drive themselves to the point of exhaustion; they undergo hardship, suffering, sickness; and then, after they have made their land fit for production, they find, if they try to sell it, that they cannot get back what it cost them, and they are forced to acknowledge that value is of human creation. I defy anyone to cite an example of colonization that at the beginning was not a disaster.

9.241

Upwards of a thousand labourers were sent out to the Swan River Colony; but the extreme cheapness of the land [eighteen pence, or less than two francs, an acre] and the extravagant rate of labour, afforded them such facilities and inducements to become landowners, that capitalists could no longer get anyone to cultivate their lands. A capital of £200,000 [five million francs] was lost in consequence, and the colony became a scene of desolation. The labourers having left their employers from the delusive desire to become landowners, agricultural implements were allowed to rust, seeds rotted, and sheep, cattle, and horses perished from want of attention. A frightful famine cured the labourers of their infatuation, and they returned to ask employment from the capitalists; but it was too late.
**37

9.242

The Australian Association, attributing the disaster to the cheapness of the land, raised the price to twelve shillings. But, adds Carey,
*91 from whom I take this quotation, the real cause was that the farm workers were convinced that the land had
intrinsic value, apart from any work done on it, and were eager to appropriate this so-called
value, which they assumed would virtually assure them a yearly rent.

9.243

The sequel provides me with an even more conclusive argument.

9.244

In 1836, the landed estates of the colony of Swan River were to be purchased from the original settlers at a shilling an acre.
**38

9.245

Thus, this soil, for which the company had charged twelve shillings—and on which the settlers had spent much time and money—was now resold for one shilling! What had happened to the value of the
productive and indestructible powers of Nature?**39

9.246

The vast and important subject of the value of land has not been exhaustively treated, I realize, in this chapter, which was written at intervals in the midst of constant interruptions: I shall return to it, but I cannot close without submitting one observation to my readers and particularly to economists.

9.247

Those illustrious scholars who have contributed so much to the progress of political economy, whose lives and works breathe the spirit of benevolence and philanthropy, who, at least in certain respects and within the areas of their investigation, have discovered for us the true solution to the problems of society, men like Quesnay, Turgot, Smith, Malthus, Say, have not escaped, I do not say refutation, which is always in order, but slander, defamation, and the coarsest of insults. To attack their writings, and even their motives, has almost become the fashion. It will be said, perhaps, that in this chapter I myself furnish arms to their detractors, and, indeed, this is hardly the moment for me to turn against those whom, I most solemnly declare, I look upon as my first instructors, my guides, and my masters. But, in the last analysis, must not my highest allegiance be to truth, or to what I consider to be truth? Where in the world is there a book into which no error has crept? Now, in political economy, just one error, if we press it, if we torture it, if we insist upon drawing all its logical implications from it, will eventually be found to include all other errors; it will lead us to chaos. No book exists, therefore, from which an isolated proposition cannot be taken out of context and be declared incomplete, false, and consequently as involving a world of errors and confusions.

9.248

In all good conscience I believe that the definition that the economists have given of the word
value is an error of this kind. We have just seen that this definition placed them in a position where they themselves cast grave doubt upon the legitimacy of landed property, and, by logical deduction, upon the whole system of capital; and only by an illogical chain of reasoning did they stop short of disaster along this road. Their inconsistency saved them. They redirected their steps toward the way of truth, and their error, if such it be, stands as the only blemish on their works. The socialists came along and laid hold of this definition, not to refute it, but to adopt it, to strengthen it, to make it the starting point for their propaganda, and to expatiate on all its implications. There has been in our time imminent danger to society in all this, and for that reason I felt it my duty to speak my mind completely, to trace this erroneous theory back to its very beginnings. Now, if one wished to conclude from my remarks that I have parted company with my masters, Smith and Say, with my friends Blanqui and Garnier, solely because they failed to grasp the full significance of one line out of all the many pages in their excellent and learned writings, and perhaps misused, as I believe, the word “value”; if one should conclude on that account that I no longer have faith in political economy and the economists; I can only protest—and that I do, most emphatically, as is evidenced by the very title of this book.