Chapter LX: Section CCII

HARMONY OF THE THREE BRANCHES OF INCOME.--NECESSITY OF THE FEELING OF A COMMON INTEREST.

Every class corresponding to a branch of the national income must live with the consciousness that its interests coincide with the economic interests of the whole nation. Whenever the entire national income increases, each branch of it may increase without any injury to the others, and, as a rule, does really increase.[202-1] But it is possible that the land owning class may be specially dependent on the prosperity of the whole people. How easy it is for workmen to emigrate; and how much easier yet for capital! England, to-day, can scarcely carry on a great war, in which it would not, at least at the beginning, have to fight English capital.[202-2] Where the treasure is, the heart is also! 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 It alone cannot be withdrawn from the pressure of taxation or from the distress of war.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 circumstances, an important element of political and religious freedom. Moreover, the bright side and the dark of every class 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 principal conditions precedent to the prosperity of production; inasmuch as upon it depends the participation (_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
classes 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 class 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 constitutions,
charters of cities, etc., the exercise of the higher rights
of citizenship is conditioned by the possession of a certain
quantity 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
noblemen 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 institutions would have lost all foundation.

_Ad. Müller_ 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 Cæsar destroyed only the constitution, 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 classes as the constitutionalist 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
Réduction de la Rente, 56. _Fuoco_ exaggerates this into the
principle: _che la distribuzione, e non la produzione, sia
la prima e principal operazione in economia_. (Saggi
economici, II, p. 44.)]