A Stake in the Land Part 12

2. Purchase, by land bond issues.

3. Taxation, by the single tax.

B. Forms of public ownership:

1. Nationalization; national ownership. In the United States it would be Federal ownership.

2. Provincial ownership. In the United States it would be state ownership, and in Switzerland canton ownership.

3. Munic.i.p.alization or communalization; land owned by cities and communities in the rural districts.

4. n.o.body's ownership; free to all, except that the public takes the ground value (irrespective of improvements) through the single tax, from the land users, which practically means a disguised form of public ownership, or at least a condition very near it.

C. Methods of use:

1. Parceling the public land into homesteads of one-family size, and reselling these to the cultivators on the basis of individual fee simple.

2. Giving the homesteads to cultivators on the basis of perpetual leasehold.

3. Public cultivation, either direct or through communes or co-operative a.s.sociations.

Comparing these programs one with another and with the existing conditions, one reaches the following conclusions: All the programs tend to treat the land problem merely as a question of ownership. Each favors a specific form of ownership almost as an all-inclusive remedy for defects in social relations so far as they depend upon land cultivation and land use. The argument is based upon reasoning, a mere logical calculation, and on what the authors of the program desire. The existing conditions and tendencies are much more varied and complex than they seem to appear to the land reformers.

First, there is nothing new or untried in these programs, for almost all the advocated forms of land ownership are already existing side by side.

It seems that no one single form is able to remedy the defects in the land situation. We have in this country national (Federal), provincial (state), and munic.i.p.al or communal ownership, with small-scale private ownership predominating. We also have special land taxation, as, for instance, in certain cities that tax unimproved land higher than improved land. These existing forms of land ownership are competing with one another. The forms which allow more efficient cultivation, result in greater social stability, and are based on social justice will be the winners in the march of the economic and social progress of the country.

The bold claim of Marxian or German Socialism that large private land ownership, erroneously identified with cultivation on a large scale, is going to prevail through absorption of small private land ownership is rapidly losing ground. The small landowners are able to enjoy, through co-operation, all the technical advantages of large-scale cultivation, retaining as well the advantages resulting from individual initiative and efficiency. There is a marked movement toward co-operation among the small farmers the world over. In Denmark it has developed to the highest degree.

Second, mere land ownership is only a part, though a vital part, of the problem. Many other important things have to be considered.

If a man has land, but lacks capital or credit, he is unable to make economic use of his land. If he has both land and capital, or credit, or in other terms purchasing power, but lacks access to sources of supply in which to buy seeds, breeding stock, and implements, he still is unable to make use of his land. If he has at hand all the needed implements, seeds, and stock, but lacks knowledge and experience in farming, he might entirely fail in his enterprise. Even if he possesses the necessary knowledge and produces grain, milk, beef, and other agricultural products, he must have a market for his products, be it a domestic or an international market. This involves transportation facilities, trade organization and regulation, tariff, and other forms of organized international relationships, economic and political.

Moreover, land cultivation requires social stability, security, and order, for an investment in land improvements must wait long for its returns. If a man does not know who is going to harvest his fields, or who is going to get the product of his toil, he will be disinclined to sow anything. A striking ill.u.s.tration of such a state is the case of the western provinces of the Russian Empire, where the battle lines for several years were surging back and forth. First the Russian monarchy collected the farm products, then came the Germans, then came the civil warfare. When there is no security for a land cultivator, neither for his products nor his very life itself, there can be no production. There is land enough and there are cultivators enough, but the population starves because of unsettled political and international conditions.

PLENTY OF LAND

In considering the land situation as it exists, it is true that the ownership of land or, rather, the access to land, is of primary importance. The question arises, Is there enough land in the United States for all citizens who desire to become cultivators?

The Secretary of the Interior, Mr. Lane, states[17] that more than 15,000,000 acres of irrigable lands remain in the hands of the United States government. There are between 70,000,000 and 80,000,000 acres of swamp and overflowed lands in the United States of which about 60,000,000 acres can be reclaimed for agricultural purposes, and there are about 200,000,000 acres of cut-over or logged-off lands which are suitable for agricultural development.

Although it might be questioned how much of these unused lands are economically available under normal conditions--for no rigid investigation has been made--still the fact remains that unused lands--swamps and deserts, cut-over and burned-over lands--are being continually improved and taken under cultivation by private and public effort. Not one land improvement and colonization company visited by the writer complained of lack of land. All the companies seemed to want more settlers and more credit. This fact indicates that there is economically available land in our country, and probably plenty of it, for a normal process of reclamation and colonization.

PUBLIC REGULATION OF LAND DEALING

In the field investigation, the main questions of immigrants desiring to settle on land seemed to be where to find land of the "right kind," and how, in acquiring it, to avoid being cheated by private land sellers.

The questions as to whether there was land available and what its price was were of minor importance. In many cases the immigrants had been employed in war industries and had saved money enough to buy a farm, but they were unable to decide where to settle and what kind of land to buy because they feared land sellers. Their experience with these agents had awakened an almost universal fear of private land dealers.

To facilitate the access to land, the private land-dealing trade must be put upon a higher level. There must be Federal legislation regulating land dealers doing business in two or more states, state legislation for dealers doing business within one state only, and munic.i.p.al legislation for the land dealers doing business within the city limits only. Through co-operation of these governments uniformity of such legislation can be secured and maintained so far as various local conditions and peculiarities allow.

Such regulative legislation should aim at doing away with misrepresentation and frauds in land dealing. As an effective a.s.sistance in the enforcement of the laws all private land dealers should be licensed, interstate dealers by the Federal, state dealers by the state, and city dealers by the city governments. By refusing or recalling licenses a considerable number of land sharks--get-rich-quick charlatans in the real-estate business--can be sifted out of the trade and the necessary confidence on the part of land seekers can be secured.

According to a report made in 1916 by the Committee on State Legislation of the National a.s.sociation of Real Estate Boards, a sentiment was then growing in most parts of the country favoring the enactment of laws for the regulation of real-estate brokerages under state authority. This sentiment is still growing, and the secretary of the a.s.sociation says that realtors in several states continue to introduce bills in their legislatures with the belief that it will be possible to pa.s.s them.

In only one state has such a law pa.s.sed. The state of Wisconsin enacted a law in 1919[18] which provides for the establishment of a state real-estate brokers' board consisting of three members, at least two of whom are real-estate brokers in the state, appointed by the Governor.

The Director of Immigration, Department of Agriculture, acts as secretary to the board. The latter issues licenses to the real-estate brokers and salesmen doing business in the state. An annual license fee of ten dollars from a broker and five dollars from a salesman is required. License may be refused or revoked by the board for misstatement in application, for fraud or fraudulent practices, for untrustworthiness or incompetence in real-estate business.

The board receives complaints against any real-estate broker or salesman.

It may conduct hearings and investigations, subpna and compel the attendance and testimony of witnesses and production of doc.u.ments, books and papers. The board shall, from time to time, publish the names of licensed real-estate brokers and salesmen, with information as to when each license expires. The publication shall include the names of those real-estate brokers and salesmen whose licenses have been revoked at any time within one year prior to the time of the issue of publication.

This Wisconsin Real Estate Licensing law has been in operation a year.

Mr. B. G. Packer, Director of Immigration, and secretary to the Real Estate Brokers' Board, gave to the writer the following information in regard to the results of the operation of the law so far.

This law requires registration of all real-estate brokers and salesmen doing business in the state. In the past there was no way to tell who they were or where located. The license is good for one year, and thereupon a new application must be made. This gives the board a check on the dealer's operations the preceding year. The board requires him to cite all legal actions arising out of his real-estate business whether he was plaintiff or defendant.

It is a common practice with some dealers to take a judgment note for commission which can be entered up without process and execution levied against the property of the defendants. The defendant can open up the judgment and put in a defense if he can show misrepresentation and fraud. This year, when several applicants applied for new licenses, the board found this condition and the licenses were refused.

The applicant for license must show affirmatively that he is trustworthy and competent. In the past the state took no pains to find this out. The licensing board operates as a poor man's court of redress in transactions arising out of the land business. In the past the purchaser's remedy was a more or less satisfactory suit at law.

The licensing board can make investigations and hold hearings on its own motion. In the past the initiative had to be taken by the party claiming deception.

Last year the board granted licenses to 4,600 brokers and salesmen, denied 20 applications, revoked 2 licenses, and has at present 60 hearings pending on applications for licenses in 1921.

The Wisconsin license law does not reach the owner who has worthless land to unload upon an unsophisticated purchaser. Besides this, the law has other limitations. But nevertheless it is a step ahead.

Pennsylvania, the Southern states, and cities in many parts of the country have required a license fee or an occupation tax from real-estate men, but such laws do not regulate, because, as the above-mentioned report states, "no matter how high the fee, the usual run of licensing or prosecuting official will not use his authority to establish moral standards." Furthermore, "in New York and most Northern and Western states, even the slight check of the occupation tax is absent and there is no formality to be observed in entering our profession by any person, no matter how unreliable, irresponsible, or incapable, and whatever his record."

After agitation covering a period of twelve years, the real-estate brokers of California succeeded in 1917 in having enacted a law for the regulation of real-estate brokerage. In 1918 this law was declared unconst.i.tutional by the Supreme Court, on the ground that insurance men were exempted by the wording of the act and that such exemption made the law discriminatory.

The Real Estate Commissioner of the state gives the following synopsis of the law:

The act "provides for the issuance of licenses to two cla.s.ses of persons--the broker himself, who, in addition to taking out a license, is required to put up a bond running to the state of California, and the salesman, who is defined as one in the employ of a licensed broker and ... is not required to put up a bond." The act is administered by a Real Estate Commissioner appointed by the Governor. Upon pet.i.tion to the Real Estate Commissioner appointed by those aggrieved in their dealings with brokers or salesmen, a hearing is provided before the commissioner, and upon proper showing the pet.i.tioner may be granted the privilege of suing the broker on his bond.... There is also a provision for the filing of complaints against brokers and salesmen concerning their conduct and, upon investigation, if found guilty, the commissioner is empowered to revoke their licenses. The law provides a heavy penalty for a broker--a fine of $2,000 or a prison sentence of two years--and in the case of corporations, a maximum fine of $5,000.

The fees for licenses are, for brokers, $10 per annum, and for salesmen, $2 per annum.

The operation of the law appears to have been extremely successful and to have been heartily indorsed by the public generally and by all the reliable real-estate dealers and salesmen in the state. The Real Estate Commissioner gives the following picture of the results of the law during the eight months it was in force:

1. It gave the realtors faith in each other, each being under bond and licensed by the commissioner with power of revocation in case of violation of the law.

2. It increased the confidence of the public generally in the realty business, for the law afforded the public a ready and inexpensive means of redress in case of wrongdoing.

3. During the eight months, some sixty complaints were filed with the commissioner, and all were adjusted without even a formal hearing up to the time the law was thrown out, March, 1918. Some twenty-five hundred dollars was returned to defrauded purchasers through appeals to the commissioner.

4. The deterrent effect of the law on wrongdoers will never be known, but must have been far-reaching.

5. So satisfactory was the law that the public, the bankers, and especially the realtors, are preparing again to present to the legislature during the winter of 1918-19 a more carefully worded law governing the realty business.

One of the services rendered by the Department of the Real Estate Commissioner was the issue of a directory of licensed real-estate brokers and salesmen in the state. The first copy was published October 1, 1917, and contained about four thousand names, as well as other material such as maps, laws, and legal opinions, designed to be of practical value to all realtors. It was intended that this directory be issued quarterly and be distributed to licensed brokers, with a subscription price to others of one dollar a year. The commissioner regarded this directory bulletin which bound together in fraternalism the real-estate men of the state, as only one of the many possibilities of extending valuable aids through his department to the real-estate profession, and so indirectly to the agricultural industry.