British Socialism Part 19

[430] _Socialism Made Plain_, p. 9.

[431] _Capital and Land_, pp. 5, 6.

[432] Kautsky, _The Social Revolution_, p. 11.

[433] Blatchford, _The Clarion Ballads_, p. 9.

[434] Blatchford, _The Pope's Socialism_, p. 2.

[435] Bax and Quelch, _A New Catechism of Socialism_, p. 17.

[436] Sorge, _Socialism and the Worker_, p. 11.

[437] Keir Hardie, _From Serfdom to Socialism_, p. 11.

[438] Joynes, _The Socialist Catechism_, p. 3.

[439] Davidson, _The Gospel of the Poor_, p. 54.

[440] See Appendix.

[441] _Justice_, October 19, 1907.

[442] Davidson, _The Democrat's Address_, p. 5.

[443] _Socialism Made Plain_, p. 8.

[444] Davidson, _The Gospel of the Poor_, p. 49.

[445] McLachlan, _Tyranny of Usury_, p. 13.

[446] Davidson, _The Old Order and the New_, p. 76.

[447] _Wealth Makers and Wealth Takers_, p. 1.

[448] Sorge, _Socialism and the Worker_, p. 10.

CHAPTER X

SOCIALIST VIEWS AND PROPOSALS REGARDING TAXATION AND THE NATIONAL BUDGET

To Socialists taxation is chiefly a means for impoverishing the rich and the well-to-do. It is their object to transfer by taxation the wealth from the few to the many, as they believe that the impoverishment of the rich will mean the enrichment of the poor.

Therefore they do not aim at economy in national and local expenditure. On the contrary, they wish to spend as much as possible.

As money is to be obtained solely from the rich, "An increase in national taxation has no terrors for Socialists."[449] Every increase in expenditure is greeted by them with joy, and wastefulness in national and local undertakings is rather encouraged than condemned.

"Socialists look to the Budget as a means not only of raising revenue to meet unavoidable expenditure, but as an instrument for redressing inequalities in the distribution of wealth."[450] Let us first look into the financial views of the Socialists, and then into their positive proposals.

"The purpose of Socialism is to transfer land and industrial capital to the people. There are two ways in which, simultaneously, this object may be carried out. The one way is by the munic.i.p.al and national appropriation--with such compensation to the existing owners as the community may think fit to give--of the land and industrial concerns. The second method is by taxation. Taxation has its special sphere of usefulness in helping the community to secure some part of its own by diverting into the national purse portions of the rent, interest, and profit which now go to keep an idle cla.s.s in luxury at the expense of the industrious poor."[451]

"The existence of a rich cla.s.s, whose riches are the cause of the poverty of the ma.s.ses, is the justification for the Socialist demand that the cost of bettering the condition of the people must be met by the taxation of the rich. The Socialist's ideas of taxation may be briefly summarised as follows: (1) Both local and national taxation should aim primarily at securing for the communal benefit all 'unearned' or 'social' increment of wealth. (2) Taxation should aim deliberately at preventing the retention of large incomes and great fortunes in private hands, recognising that the few cannot be rich without making the many poor. (3) Taxation should be in proportion to ability to pay and to protection and benefit conferred by the State.

(4) No taxation should be imposed which encroaches upon the individual's means to satisfy his physical needs."[452]

"To the Socialist taxation is the chief means by which he may recover from the propertied cla.s.ses some portion of the plunder which their economic strength and social position have enabled them to extract from the workers; to him, national and munic.i.p.al expenditure is the spending for common purposes of an ever-increasing proportion of the national income. The degree of civilisation which a State has reached may almost be measured by the proportion of the national income which is spent collectively instead of individually. To the Socialist the best of Governments is that which spends the most. The only possible policy is deliberately to tax the rich, especially those who live on wealth which they do not earn; for thus, and thus only, can we reduce the burthen upon the poor."[453]

The Fabian Society suggests the following reform of national taxation: "In English politics successful ends must have moderate beginnings.

Such a beginning might be an income-tax of _2s. 6d._ in the pound.

Unearned incomes above _5,000l._ a year would pay _2s. 6d._ in the pound, below _5,000l._ a year _1s. 8d._ in the pound. The estate duty might be handled upon similar principles. Estates between _500,000l._ and _1,000,000l._ would be charged twelve and a half per cent, instead of seven and a half, and estates exceeding _1,000,000l._ fifteen per cent, instead of eight."[454] The Fabian Society does not disguise its aim in proposing the foregoing: "These suggestions are doubtless confiscatory, and that is why they should recommend themselves to a Labour party. But even so, the confiscation is of a timorous and a slow-footed sort. The average British millionaire dies worth about _2,770,000l._, on which the death duty would be _415,500l._, leaving the agreeable nest-egg of _2,254,500l._ to the heirs. Even if we a.s.sume that the inheritance pa.s.ses to one person only, so as to be subject to the highest rate of duty, it would not be until five more lives had pa.s.sed that it would be reduced to a pitiful million. The most patient Labour party might not unreasonably demand something a trifle more revolutionary than this."[455]

According to the above proposals the income-tax would return _47,600,000l._ per annum. This sum seems far too moderate to most Socialist writers. Councillor Glyde, for instance, gives in a widely read pamphlet elaborate tables in which the produce of a graduated income-tax is carefully calculated. The Fabian Society would make "a moderate beginning" by taxing large incomes _2s. 6d._ in the pound.

Councillor Glyde would begin by levying a _3s._ income-tax on them.

Taxation of incomes in accordance with his proposals would bring in _70,281,839l._ per annum.[456]

Mr. Smart, of the Independent Labour Party, gives lengthy details of a taxation reform scheme in which figure a foundation-tax, a special property-tax, and a super-tax. Large incomes would have to pay 17-1/2 per cent., or _3s. 6d._ in the pound, and his property and income tax would bring in _78,000,000l._ per annum.[457]

Mr. Philip Snowden, M.P., submits a different scheme of taxation.

There is to be an income-tax of _1s._ in the pound and a graduated super-tax up to _6s._ in the pound. Whilst the three authorities mentioned so far propose to take from the large incomes _2s. 6d._, _3s._, and _3s. 6d._ in the pound as a "moderate beginning," Mr.

Snowden would, presumably also as a "moderate beginning," take _7s._ in the pound from them. He is quite touched with his own generosity and magnanimity, for might he not demand at once _17s._ or _20s._ in the pound? "To console the possessors of incomes in the higher grade, say _50,000l._ a year, to the payment of an income-tax of _1s._ in the pound, we may remind them that they still retain _33,500l._ a year, which is a very generous payment by labour to them for the privilege of seeing them exist in gorgeous splendour and sumptuous idleness."[458]

The proposals regarding the estate duty to be charged also vary. The Fabian Society proposes a maximum of 15 per cent. Mr. Smart would be satisfied with a graduated estate duty with a maximum of 25 per cent, instead of the present maximum of 8 per cent.[459] Mr. Snowden proposes a scale of duties which ranges from 1 per cent, up to 50 per cent.[460]

Besides the very greatly increased income-tax and estate duty, there would be, according to Mr. Snowden, a land value tax of a penny in the pound of its capital value, which is equal to 10 per cent. annual value. It is to be the small beginning of the policy of taxing landowners out of existence, to be speedily followed by confiscation.

"The annual value of land being _250,000,000l._, the produce of the land value tax would be _25,000,000l._ a year."[461] The author justifies the creation of that tax as follows: "Liverpool, London, Glasgow owe their existence and their prosperity to their respective situations, which are natural advantages and which ought not in justice to be enjoyed solely by those who live upon the sites. Every town and village in the country contributes to the prosperity of every other part. The nation is a unit; its resources and its obligations should be mutually shared."

"Land values are so obviously not created by individual effort that the justice of taking the increment for the use of the community appeals to those who may have some difficulty in grasping the working of the 'unearned increment' in commercial concerns, where, however, it operates just as truly though not so obviously. The imposition of an Imperial tax of one penny in the pound on the capital value of the site would be a beginning, but by no means the end, of the process of diverting socially-created rent of land into the public exchequer.

Taxation will do something towards that end; but taxation would be a long, irritating, and untrustworthy way of trying to secure the whole annual value of the land for the community."[462] "The taxation of land values is not a land reform. To get the full usefulness and the full value of the land for the community there is no way but for the State to own the land."[463]

The contemplated reform of taxation will not be limited to taxing the rich and the well-to-do out of existence. Relief will be afforded to the ma.s.ses by the repeal of all duties on food, and, indeed, of all indirect taxation. "The reforms which the Labour party will endeavour to obtain from the Government, in which it believes it will be expressing the democratic sentiment of the country, are:

1. Repeal of the duties on foods.

2. A minimum wage of _30s._ to all workers in Government employ or working under a contractor for the Government.

3. Old-age pensions of _7s._ a week for persons over sixty."[464]

Practically all Socialists agree that all indirect taxation should be abolished. "Indirect taxation has nothing whatever to recommend it to an intelligent people, however advantageous it may be to the well-to-do. Indirect taxation violates every principle of sound economy."[465] "Its maintenance is excused on the ground that indirect taxation is the only means by which the working cla.s.s can be made to contribute to the cost of national government at ah. The poorer working cla.s.ses should not be taxed by the Government at all."[466]

"Under a just system of taxation all indirect taxation for revenue purposes would be abolished."[467] "With 43 per cent, of the working cla.s.ses living in poverty, with an average wage over the whole working cla.s.s not sufficient to provide themselves with the standard of workhouse comfort, it becomes a crime to tax them for the protection of their property and the enjoyment of their privileges"[468]--Is it true that, as Mr. Snowden, M.P., writes, the whole working cla.s.s of Great Britain is so badly paid that it cannot provide for itself the standard of workhouse comfort? How then can he reconcile with that a.s.sertion the following statement which he gives in the same book a few pages further on: "Experts a.s.sign the proportion of the total annual drink bill of the United Kingdom contributed by the wage-earning cla.s.ses at _100,000,000l._ A committee of the British a.s.sociation, reporting on the 'appropriation of wages,' in 1882 said that 75 per cent, of the total consumption of beer and spirits, and 10 per cent. of the wine bill, might be a.s.signed as the shares of the working cla.s.s."[469]

As a matter of fact experts estimate that the British working men spend even more than _100,000,000l._ per year on drink, and that they spend about _50,000,000l._ on betting. It is really very inartistic for a professional agitator to tell us that the British workers are too poor to pay any taxes, that it is a "crime" to tax them at all, and then to remind us that the same starving ill-used workers can afford to spend more than the amount of the whole nation's Budget in drink and betting, that about one-sixth of the workman's wages are spent at the public-house, that many workmen spend the larger half of their income in drink, and that the British nation is the most drunken in the world, although drink is far more expensive in Great Britain than in any other country.

With part of the money taken by means of extortionate taxation from the rich, whole sections of the population are to be bribed into supporting Socialism. "Two objectionable heads of revenue would find no place in a Socialist national balance-sheet--the profit from the Post Office and the stamp duties. Improvements in the wages and conditions of labour in the lower grades of the postal service would absorb a considerable part of the present annual profit of _5,000,000l._ and the rest might, with benefit, be utilised for cheapening the cost to the public of postal rates and services."[470]

Mr. Snowden, in promising in one phrase the repeal of stamp duties and cheapening of postage, very likely thought that that step would relieve the poor. He apparently imagined that duty stamps were identical with postage stamps. If he had known that stamp duties are largely derived from Stock Exchange transactions and the sale of every kind of property on a large scale, from legal doc.u.ments, &c., he would probably have proposed that they should be increased tenfold in order to strike another blow at private property, not that they should be abolished. Even the policy of confiscation requires an elementary knowledge of facts.

Furthermore, "The Socialist Budget would provide for a very considerable increase of the grants-in-aid, retaining for the central Government just sufficient control or inspection over the expenditure as would not interfere with the reasonable freedom of the local authority."[471] "Control which would not interfere" is at present illogical and impossible, because the one excludes the other. It may be possible in the Socialist State of the future, because logic will have to be abolished in it. At all events it seems clear that Mr.

Snowden wishes to secure the support of the local authorities by the same curious means by which he strives to secure the support of the Post Office servants.