Principles of Political Economy Part 19

The land alone is immovable. It alone cannot be withdrawn from the pressure of taxation or from the distress of war. It alone cannot flee into foreign parts.[202-3] [202-4] At the same time, it cannot be denied that the possibility of being able to carry one's fortune out of a country in one's pocketbook and to be able to procure there with one's money the same conveniences, customs, etc., to which one was accustomed at home, is, under certain circ.u.mstances, an important element of political and religious freedom. Moreover, the bright side and the dark of every cla.s.s of owners, especially the dread of all unnecessary and also of all necessary change, must be common to rent and interest.

Hence, where there is a marked and well-defined separation of the branches of income, it will be always considered a difficult but unavoidable problem, how to enable mere labor to take an active part in the affairs of the state.[202-5]

In times when calm prevails (not, however, in transition-crises such as are referred to in -- 24), there is a public opinion concerning merit and reward, we might say a public conscience, by which a definite relation of the three branches of income to one another is declared equitable.

Every "fair-minded man" feels satisfied when this relation is realized, and this feeling of satisfaction is one of the princ.i.p.al conditions precedent to the prosperity of production; inasmuch as upon it depends the partic.i.p.ation (_Theilnahme_) of all owners of funds and forces.

Every deviation from this relation or proportion is, of course, a misfortune,[202-6] but never so great as when it takes place at the expense of the wages of labor. It should never be forgotten that rent is an appropriation of the gifts of nature, and that interest is a further fruit obtained by frugality from older labor already remunerated.

Besides, the rate of wages when high, generally adds to the efficiency of labor, which cannot be claimed for interest or rent.[202-7] The best means to preserve the harmony of the three branches of income is, however, universal activity. "Rich or poor, strong or weak, the idler is a knave." (_J. J. Rousseau._)

[Footnote 202-1: The contrast between _Adam Smith_, at the end of the first book, and _Ricardo_, ch. 24, in regard to this point, is very characteristic of the times of those two authors. According to _Smith_, the private interests of the landowners and laborers run entirely parallel; only both cla.s.ses are easily deceived as to their own interests.

Capitalists understand their own interest very well, and represent it with great energy; but their interest is in opposition to the common good, in so far as their profit among a poor and declining people is higher than among a rich and flourishing one. _Ricardo_, on the other hand, thinks that the interest of the landowners is opposed to that of all others for the reason that they desire that the cost of the production of wheat etc. should be as high as possible.

Related to this is the fact that, in _Adam Smith's_ time, the new theory of rent remained almost unnoticed, but that after 1815, it became rapidly popular. In a similar way, the socialists of the present time are wont to charge the undertaking cla.s.s with opposing their own interests to those of the whole people, meaning by the whole the majority. (-- 196 a.)]

[Footnote 202-2: Towards the end of the 14th century the great Flemish merchants always sided with the absolutism of France in opposition to their own _Artevelde_.]

[Footnote 202-3: Hence it is, that in so many const.i.tutions, charters of cities, etc., the exercise of the higher rights of citizenship is conditioned by the possession of a certain quant.i.ty of land, and that landownership is considered as a species of public function.

I read, a short time ago, the life of a North-German n.o.blemen who, in 1813, had fought bravely against the French, "although he was a man of large estates, and the enemy might therefore very easily have laid hands on them."

If this "although" of his eulogist expressed the actual feeling of large landed proprietors, a great many old political inst.i.tutions would have lost all foundation.

_Ad. Muller_ was of opinion that the rights of primogeniture, etc., might be an obstacle in the way of the development of the net income of a nation's economy; but that they gave to the state and to the national life the warlike tone so necessary to them, etc. (Elemente, II, 90.)]

[Footnote 202-4: "The Roman capitalists on whom Pompey counted, left him in the lurch at the moment of danger, because Caesar destroyed only the const.i.tution, but respected their business relations." (_K. W. Nitsch._)]

[Footnote 202-5: _Kosegarten_, Nat. Oek., 186, thinks that, on account of the struggle between the labor interest and the interest of capitalists, in our times, the "fourth estate" is not as well represented by persons belonging to the propertied cla.s.ses as the const.i.tutionalist party thinks. And in fact, _Jarke_, Principienfragen, 1854, 197, would have it represented by the government, in order to prevent the struggle between rich and poor. See _Cherbuliez_, Riche ou Pauvre, p. 242 seq.]

[Footnote 202-6: _A. Walker_ shows, in a very happy manner, how no misfortune, however great, whether it come from heaven or from earth, in the shape of pestilence, drought, flood or oppressive taxation, so rapidly and hopelessly ruins a nation's economy as when the harmony which should exist between capital and labor is disturbed by foul play or legal frauds between labor or capital and their reward. (Sc.

of Wealth, 66.)]

[Footnote 202-7: Compare _Lotz_, Revision, III, 322 ff., 327, 334 ff. Handbuch, I, 511 ff. _Lafitte_, Sur la Reduction de la Rente, 56. _Fuoco_ exaggerates this into the principle: _che la distribuzione, e non la produzione, sia la prima e princ.i.p.al operazione in economia_. (Saggi economici, II, p. 44.)]

CHAPTER VII.

DISTRIBUTION OF NATIONAL INCOME.

SECTION CCIII.

EFFECT OF AN EQUAL DIVISION OF THE NATIONAL INCOME.

The best distribution of the national income among a people is that which enables them to enjoy the greatest amount and variety of real goods, and permanently to produce real goods in an increasing quant.i.ty and variety.

If the income of a people were divided equally among all, each one would indeed, be, to a very great extent, independent of all others. But then, no one would care to devote himself to the coa.r.s.er and less agreeable occupations, and these would be either entirely neglected, or people would have to take turns in engaging in them.[203-1] (-- 9.) And thus would disappear one of the chief advantages of the division of labor, viz: that the higher orders of talent are devoted to the higher orders of labor. Besides, it is very doubtful, whether, under such circ.u.mstances, there would still be any solvent (_zahlungsfahige_) demand for the achievements of art.

Nor would the saving of capital prosper, where such equality prevailed.

Most men consider the average outlay of their equals as an unavoidable want, and save only to the extent that they possess more than others of their cla.s.s. If, therefore, every one had an equal income, no one would consider himself in a condition to save.[203-2] The same consideration would deter most men from every economic venture, and yet no great progress is possible where no venture is made.[203-3] [203-4]

[Footnote 203-1: According to _Schaffle_, System, II, 379 ff., "the distribution of the social return of production which conduces to the attainment of the highest measure of civilization in the moral a.s.sociation of men and in all the grades of that a.s.sociation, and thereby to the satisfaction of all true human wants in the highest degree." Thus only can a satisfactory line of demarkation be drawn between the profit of capital and the wages of labor (384).]

[Footnote 203-2: See _Aristoph._, Plut., 508 ff. Not taken into consideration sufficiently by _Benjamin Franklin_, in his eulogy of the equality of property: The internal State of America, 1784.]

[Footnote 203-3: The essential characteristic of the desert is, according to _Ritter_, Erdkunde, I, 1019 seq., its uniformity. No break in the horizontal plain, and hence no condensation of atmospheric vapor into bodies of water of any considerable size. The composition of the soil is everywhere the same; nothing but ma.s.ses of silex and salt, hard and sharp. Lastly, extreme mobility of the surface, which undulates with every wind, so that no plant can take root in it. Nearly every feature in this picture finds its a.n.a.logon in the extreme political and economic equality of men.]

[Footnote 203-4: _Les superiorites, qui ne sont dues qu'a, un usage plus intelligent et mieux regle de nos facultes naturelles, loin d'etre un mal, sont un veritable bien.

C'est dans la plus grande prosperite, qui accompagne un plus grand et plus heureux effort, qu'est le principe de tout developpement._ (_Dunoyer_, Liberte du Travail, IV, 9, 10.) But, indeed, the rich man should never forget that society "inasmuch as it permits the concentration of wealth in his hands, expects that he will employ it to better advantage than the ma.s.s of mankind would if that same wealth were equally divided among them." (_Brentano._)]

SECTION CCIV.

DISTRIBUTION OF NATIONAL INCOME.--MONEYED ARISTOCRACIES AND PAUPERISM.

The extreme opposite of this, when the middle cla.s.s disappears and the whole nation falls into a few over-rich men and numberless proletarians, we call the oligarchy of money, with pauperism as the reverse of the medal. Such a social condition has all the hardship of an aristocracy without its palliatives. As it is, as a rule, the offspring of a degenerated democracy,[204-1] it cannot in form depart too widely from the principle of equality. Only get rich, they cry to the famishing poor; the law puts no obstacle in your way, and you shall immediately share our position.[204-2] Here the uniformity and centralization of the state, which are an abomination in the eyes of genuine aristocracy, are carried to the extreme. Capital takes the place of men, and is valued more than men. All life is made to depend on the state, that its masters, the great money-men, may control it as they will. The falling away of all restrictions on trade, and of all uncommercial considerations relating to persons and circ.u.mstances, gives full play to capital, and speculators seek to win all that can be won. And, indeed, all colossal fortunes are generally made at the expense of others, either with the a.s.sistance of the state-power or by speculation in the fluctuations of values.[204-3] The dependence of proletarians on others is here all the greater, because from a complete absence of capital and land, so far as they are concerned, they are compelled, uninterruptedly, to carry their entire labor-force to market; and also because the supply of labor is made in ma.s.ses embracing a large number of individuals, while the demand for labor lies in the hands of very few, and may be very readily and systematically concentrated.[204-4] So great and one-sided a dependence is, for men too far removed from one another for real mutual love, doubtless one of the greatest of moral temptations. It is as easy a matter for the hopelessly poor to hate the law, as it is for the over-rich to despise it.[204-5] Under such circ.u.mstances, the contagious power of communism, the dangers of which to order and freedom we have treated of in -- So, is great. There is a dreadful lesson in the fact of history, that six individuals owned one-half of the province of Africa, _when Nero had them put to death_![204-6] Externally, a moneyed oligarchy will always be a weak state. The great majority who have nothing to lose take little interest in the perpetuation of its political independence. They rather rejoice at the downfall of their oppressors. .h.i.therto, and are cheered by the hope of obtaining a part of the general plunder.[204-7] The rich, too, separated from the neglected and propertyless ma.s.ses of the nation, and rightly distrustful of them, begin to forget their nationality, and to balance its advantages against the sacrifices necessary to preserve it. But, a merely materialistic calculation leads doubtless to the conclusion, that universal empire is the most rational form of the state. The world-sovereignty of Rome was, by no circ.u.mstance more promoted than by the struggles between the rich and the poor, which devastated the _orbis terrarum_, and in which the Romans generally sided with the property cla.s.ses.[204-8] [204-9] [204-10]

[204-11] However, the worst horrors of the contrast here described can occur only in slave-countries. Compare _Roscher_, Nationalokonomik des Ackerbaues, -- 141.

[Footnote 204-1: The more the lower cla.s.ses degenerate into the rabble, and the more the national sovereignty comes into the hands of this rabble, the easier will it become for the rich to buy up the State.]

[Footnote 204-2: In the middle stages of the nation's economy, such as are described in ---- 62, 66, 90, 207, in which even the relative advantages of industry on a large scale over industry on a small scale, are not much developed the making political rights dependent on the possession of a certain amount of property is certainly a means of promoting equality. Hence, therefore, a reconciliation between the differences of cla.s.s created by birth, may be effected for a long time here.]

[Footnote 204-3: _Hermann_, Staatsw. Untersuchungen, II, Aufl. 136.]

[Footnote 204-4: _Necker_, Legislation et Commerce des Grains, 1775,1. pa.s.sim. Compare _Bacon_, Serm fideles, 15, 29, 34, 39.]

[Footnote 204-5: _Schiller's_ terrible words:

"_Etwas muss er sein eigen nennen, Oder der Mensch wird morden und brennen._"

--i. e., "Something must he call his own, or man will murder and burn."

It is one of _J. G. Fichte's_ fundamental thoughts that as all property is based on mutual disclaimer, the person who has nothing of his own, has disclaimed nothing, and therefore reserves his original right to everything.

(Geschlossener Handelstaat., Werke, III, 400, 445.)]

[Footnote 204-6: _Plin._, H. N., XVIII, 7.]

[Footnote 204-7: How frequently this circ.u.mstance turned to the advantage of the Germans during the migration of nations! Compare _Salvian_, De Gubern, Dei, VII. Very remarkable answer given by a Roman taken prisoner by Attila, why it must be more agreeable to live among the Huns than in the over-civilized Roman Empire: Prisci legatio, in _Niebuhr_, Corp. histor. Byzant., I, 191 ff. And thus the conquest of Constantinople by the crusaders, took place amid the jubilation of the populace and of the country people: _Nicetus_, Chron. Hist. Urbs capta, -- 11, 340. This law of nature becomes most apparent when one compares the preponderating power of Rome against Carthage, with its weakness against the Cimbri and Mithradates. May not Hannibal have been to his own country a phenomenon like that which Caesar was afterwards to Rome? A healthy and united Carthage he certainly could have held against Italy.]

[Footnote 204-8: On the tendencies of the later times of the Jewish monarchy toward an oligarchy of money, see _Amos_, 2, 6 seq.; 6 1 ff.; 8, 5 ff.; _Micha_, 2; 2 _Isaias_, 5, 8 seq.

Compare _Nehem._ 5. While Exodus, 30 and 38, mentions over 663,000 taxable men, the ten tribes comprising the kingdom of Israel had only 60,000. XII Kings, 15, 19. _Ewald_, Geschichte des Volkes Israel, II, 2, 320.]

[Footnote 204-9: The spirit of the Grecian moneyed oligarchy is best revealed by _Plato_, De Republ., VIII, and _Aristotle_, Polit., III, VI, pa.s.sim, the first of whom considers the contrast between rich and poor as in itself demoralizing (IV, 422). All that can be called by the name of tradition, the political faith of a people, and the national feeling of right, had, in the Grecian world, been transformed into mere reasoning and concerned itself, with frightful exclusiveness, to the contrast existing between rich and poor. Compare _Aristot._, Pol., II, 4, 1, with _Droysen_, Gesch. des h.e.l.lenismus, II, 496 etc., and the citations from _Menander_ in _Stob._, Serm., Lx.x.xIX, 503, in which gold and silver are proclaimed almighty. It is a remarkable proof of the _omne venalia esse_ in Greece that _Thucydides_ (II, 65) lauds even _Pericles_, especially for his incorruptibility. _Demosthenes_ says of his contemporaries, that it excited envy when any one was bribed, laughter when he confessed it; that he who was convicted of it (bribery) was pardoned, and he who blamed it, hated. (Phil., II, 121.) Compare the list in _Demosth._, Pro. Cor., 324; _Pausan_, III, 10. In Athens, on the occasion of the census-const.i.tution imposed forcibly on the state by _Antipater_, that in a population of 21,000 citizens, only 9,000 had a property worth 2,000 drachmas or more, that is, enough for a man to live on in the most n.i.g.g.ardly way, on the highest interest it would yield. If, in addition to this, account be taken of the large number of slaves, the small number of the property cla.s.s is all the more surprising, inasmuch as Lycurgus' financial administration bears evidence that the people were in a flourishing and comfortable condition; that afterwards, peace for the most part prevailed, and that Alexander's victories enabled Grecian commerce to make large gains.

Compare _Boeckh_, Staatsh. IV, 3, 9.

In Sparta, the governing cla.s.s finally numbered only 700 families, 100 of which owned all the land, and 600 of which were, therefore, only n.o.ble proletarians. It is well known that the social attempts at reform by Agis and Kleomenes only precipitated the downfall of the state. (_Plutarch_, Agis and Kleomenes.) _Aratos_ owed a great part of the consideration in which he was held to the reputation which he obtained by protecting the property of the Sicyonian exiles (_Thirlwall_, History of Greece, VIII, 167), while on the other hand, men like _Agathocles and Nabis_ supported their faction by persecution of the rich, new debtor-laws and new division of land. (_Polyb._, XIII, 6, XVI, 13, XVII, 17, XXVI, 2; _Livy_, x.x.xII, 38, 40, x.x.xIV, 31, x.x.xVIII, 34; _Plutarch_, Cleom, 20.) _Livy_ expressly says that all the _optimates_ were in favor of the Romans, and that the mult.i.tude wanted _novare omnia_ (x.x.xV, 34). On the frightful struggle between these opposite parties, on the revolutions and counter revolutions, see also _Polyb._, XIII, 1, 2; XVIII, 36 ff., x.x.x, 14; XXII, 21; x.x.xVIII, 2, 3; _Diodor._, XIX, 6, 9; _Exc._, 587, 623; _Livy_, XLI, 25, XLII, 5; Pausan, VII, 14. In Botia, no one was for 25 years, chosen by the people for the higher offices, from whom they did not expect a suspension of the administration of justice in the matter of crimes and debts, as well as the spending of the national treasure. (_Polyb._, XX, 14, 5, 6.) The events at Corinth, before its conquest by the Romans, forcibly remind one of the Paris Commune of 1871. This decline had, as usual, begun earliest in the colonies: thus, in Sicily, even in _Thucyd._, V, 4. Milesian struggle off the p???t?? and ?e?????a in _Plutarch_, Qu. Gr., 32; _Athen._, XII, 524.]

[Footnote 204-10: The disappearance of the middle cla.s.s in Rome, between the second and third Punic war, was brought about chiefly by the great foreign conquests made by it. An idea of the wealth which the governors of the provinces might extort may be formed from this among other facts, that Cicero originally demanded against Verres a fine of 5,000,000 thalers. (_Cic._, in Verrem Div., 5.) Verres is related to have said, that he would be satisfied if he could retain the first year's booty; that during the second, he collected for his defenders; and during the third, for his judges! (_Cic._, in Verr., I, 14.) Even _Cicero_ became richer within the s.p.a.ce of one year, in Cilicia, where it was well known he was not oppressive, by 110,000 thalers, which sum does not include numerous presents, pictures, etc.

(_Drumann_, Gesch. Roms., VI, 384.) On the frightful oppression and extortion practised by Brutus (!) in Asia, see _Cicero_, ad. Att, V, 21; VI, 1. _Sall.u.s.t_, in his Jugurtha, has shown how such men waged war, and to what extremes their well-deserved want might push them in his Catiline. _Patricium scelus!_ Most of the senators were in debt to Cra.s.sus; and this, together with his great political insurance-activity and power in elections, criminal cases at law, etc., it depended that he, for a time, figured beside Caesar and Pompey.

The wealth of these important personages must, and that not only relatively, have made the poor poorer and their luxury excited the covetousness of the people; but especially the great number of slaves they kept, combined with their pasturage system of husbandry, which rapidly spread over all of Italy after the provinces had emptied their granaries to supply the wants of the sovereign people, must have made it less and less possible for the proletarians to live by the work of their hands. Previously, the lower cla.s.ses of the free born had been exempted from the military service, while slaves were conscripted for the fleet. Now, all this was changed; and thus was taken away one of the chief causes which had made the labor of free day laborers more advantageous on the larger estates. (_Nitzsch_, Gracchen, 124 ff., 235 ff.) The spoils of war and conquest caused the higher middle cla.s.s to prefer to engage in the usurious loaning of money rather than in industry which would much more rapidly have formed a small middle cla.s.s. (_Mommsen_, R. G. I, 622 ff.)