Chapter VIII: Part 8

People grumble a great deal about the rates, because they get nothing across the counter for them; and what they do get they share with everyone else, so that they have no sense of individual property in it, as they have in their clothes and houses and furniture. But they would not possess their clothes or their furniture or their houses very long in peace but for the paved and lighted and policed streets, the water supply and drainage, and all the other services the rates pay for. The Intelligent Woman, when she begins to study these matters, soon realizes that she gets better value for her rates than for any other part of her expenditure, and that the municipal candidates who ask for her vote on the ground that they are going to abolish or reduce the rates (which they fortunately cannot do) are mostly either fools or humbugs, if not both. And she has the satisfaction of knowing that she gets these services as nearly as possible at their cost to the local authority, which not only does not profiteer at her expense, but does for nothing a great deal of directorial work that in any private business would have to be paid for, and under present circumstances ought to be paid for, in public business as well.

The same advantage can be claimed for taxes. Of all the public services which you pay for in taxes to the Government it can be said that there is no direct profiteering in them: you get them for what they cost the Government: that is, for much less than you would have to pay if they were private business concerns.

So far it would seem that when you pay your rates and taxes you escape the exactions which pursue you whenever you spend money in any other way. You are perhaps beginning to feel that the next time the collector calls you will hear his knock with joy, and welcome him with the beaming face of the willing giver.

I am sorry to spoil it all; but the truth is that Capitalism plunders you through the Government and the municipalities and County Councils as effectually as it does through the shopkeeper. It is not only that the Government and the local authorities, in order to carry on their public services, have to buy vast quantities of goods from private profiteers who charge them more than cost price, and that this overcharge is passed on to you as a ratepayer and taxpayer. Nor is it that the Government of the country, acting for the people of the country, cannot use the land of the country without paying some private person heavily for leave to do so. There are ways of getting round these overcharges, as, for instance, when the Government buys a piece of land for its operations, but raises the money to pay for it by a tax on rent which only the landlords pay, or when it raises capital by a tax on unearned incomes. By this expedient it can, and sometimes does, give you a complete and genuine cost price service. It can even give it to you for nothing and make richer people pay for it.

But you are rated and taxed not only to pay for public services which are equally useful to all, but for other things as well; and when you come to these you may, if you are a rich woman, complain that you are being plundered by Socialists for the benefit of the poor, or, if you are a poor woman, that you are being plundered by Capitalists who throw on the rents and taxes certain expenses which they should pay out of their own pockets.

Let us see what foundation there is for such complaints. Let us begin with the rich. By taxation rich people have a quarter or a third of their incomes, and very rich people more than half, taken from them by the Government, not for any specified public service, but as pure nationalization (communization) of their income to that extent without any compensation, and by simple coercion. This is now taken so completely as a matter of course that the rich never dream of asking for compensation, or refusing to pay until their goods are forcibly seized, or even of calling it Bolshevik confiscation; and so we are apt to talk as if such things never happened except in the imaginations of wicked Communists; but they happen in Great Britain regularly every January; and the Act authorizing them is brought in every April by the Chancellor of the Exchequer. Though reassuringly called the Appropriation Act it is really an Expropriation Act.

There is nothing in the law or the Constitution, or in any custom or tradition or parliamentary usage or any other part of our established morality, to prevent this confiscated third or half being raised to three-quarters, nine-tenths, or the whole. Besides this, when a very rich person dies, the Government confiscates the entire income of the property for the next eight years. The smallest taxable properties have to give up their incomes to the Government for ten months, and the rest for different periods between these extremes, in proportion to their amount.

In addition, there are certain taxes paid by rich and poor alike, called indirect taxes. Some of them are taxes on certain articles of food, and on tobacco and spirits, which you pay in the shop when you buy them, as part of the price. Others are stamp duties: twopence if you give a receipt for £2 or more, sixpence if you make a simple written agreement, hundreds of pounds on certain other documents which propertyless people never use. None of these taxes are levied for a named service like the police rate or the water rate: they are simple transfers of income from private pockets to the national pocket, and, as such, acts of pure Communism. It may surprise you to learn that even without counting the taxes on food, which fall on all classes, the private property thus communized already amounts to nearly a million a day.

The rich may well gasp at the figure, and ask what does the Government do with it all? What value do they get for this contribution which appears so prodigious to most of us who have to count our incomes in hundreds a year and not in millions a day? Well, the Government provides an army and navy, a civil service, courts of law and so forth; and, as we have seen, it provides them either at cost price or more nearly at cost price than any commercial concern would. But over a hundred million solid pounds of it are handed over every year in hard cash in pensions and doles to the unfortunate people who have small incomes or none.

This is pure redistribution of income: that is, pure Socialism. The officers of the Government take the money from the rich and give it to the poor because the poor have not enough and the rich have too much, without regard to their personal merits. And here again there is no constitutional limit to the process. I can remember a time when there was no supertax, and the income tax was twopence in the pound instead of four-and-sixpence or five shillings, and when Gladstone hoped to abolish it altogether. Nobody dreamt then of using taxation as an instrument for effecting a more equal distribution of income. Nowadays it is one of the chief uses of taxation; and it could be carried to complete equality without any change in our annual exchequer routine.

So far the poor have the better of the bargain. But some of the rich do very well out of the taxes. By far the heaviest single item of Government expenditure is the annual payment for the hire of the money we borrowed for the war. It is all spent and gone; but we must go on paying for the hire until we replace and repay it. Most of it was borrowed from the rich, because they alone had any spare money to lend. Consequently the Government takes a vast sum of money every year from the whole body of rich, and immediately hands it back to those who lent it money for the war. The effect of this transaction is simply to redistribute income between the rich themselves. Those who lose by it make a fuss about what they call the burden of the National Debt; but the nation is not a penny the poorer for taking money from one bold Briton and giving it to another. Whether the transfer is for better or worse depends on whether it increases or diminishes the existing inequality. Unfortunately, it is bound, on the whole, to increase it, because the Government, instead of taking money from some capitalists and dividing it among them all, is taking money from all capitalists and dividing it among some of them. This is the real mischief of the National Debt, which, in so far as it is owed to our own people, is not a debt at all. To illustrate, one may say that an elephant does not complain of being burdened because its legs have to carry its own weight; but if all the weight were on one side instead of being equally distributed between the legs, the elephant would hardly be able to carry it, and would roll over on its back when it met the slightest obstacle, which is very much what our trade does under our unequal system.

It is sometimes said that the capitalists who lent the Government the money for the war deserve the hire of it because they made sacrifices. As I was one of them myself I can tell you without malice that this is sentimental nonsense. They were the only people who were not called on to make any sacrifice: on the contrary, they were offered a gilt-edged investment at five per cent when they would have taken four. The people who were blinded, maimed, or killed by the war were those really sacrificed; and those who worked and fought were the real saviors of the country; whilst the people who did nothing but seize the national loaf that others had made, and take a big bite out of it (they and their servants) before passing on what they left of it to the soldiers, did no personal service at all: they only made the food shortage still shorter. The reason for pampering them in this absurd fashion was not for any service or merit on their part: it was the special consideration we have to shew to spare money as such because we are afraid there would not be any available if we did not pamper a class by giving it more than it can spend. We shall have to go further into this when we examine the nature of capital later on. Meanwhile, if you had the misfortune to lose an eye during one of the air raids, or if you lost your husband or son, or if you “did your bit” strenuously throughout the war, and are now a taxpayer, it must seem to you, to say the least, funny to have money taken from you by the Government and handed over to some lady who did nothing but live as indulgently as she could all the time. You will not easily be convinced that it would have been a more dreadful thing for the Government to commandeer her money than your husband’s limbs, or your son’s life. The utmost that can be said is that it may have been more expedient.

One more example of how your taxes may be used to enrich profiteers instead of to do you any service. At the beginning of the war, the influence of the profiteers was so strong that they persuaded the Government to allow them to make all the shells instead of having them made in national factories. The result was that you were paying taxes to keep workmen standing idle in Woolwich Arsenal at full wages in order that the profiteering firms should have all the work at a profit. You had to pay their workmen too, and the profit into the bargain. It soon turned out that they could not make nearly enough shells. Those they did make were unnecessarily expensive and not always explosive. The result was an appalling slaughter of our young men in Flanders, who were left almost defenceless in the trenches through the shortage of munitions; and we were on the verge of being defeated by simple extermination when the Government, taking the matter in hand itself, opened national factories (you may have worked in some of them) in which munitions were produced on such a scale that we have hardly yet got rid of what was left of them when the war ended, besides controlling the profiteers, teaching them their business (they did not know even how to keep proper accounts, and were wasting money like water), and limiting their profits drastically. And yet, in the face of this experience (which was of course a tremendous triumph for the advocates of nationalized industries), the war was no sooner at an end than the capitalist papers began again with their foolish and corrupt declarations that Governments are such incompetent and dishonest and extravagant jobbers, and private firms so splendidly capable and straightforward, that Governments must never do anything that private firms can make profits by doing; and very soon all the national factories were sold for an old song to the profiteers, and the national workers were in the streets with the demobilized soldiers, living on the dole, two millions strong.

This is only a sensational instance of something that is always going on: namely, the wasting of your money by employing profiteering contractors to do the work that could be done better by the authorities themselves without charging you any profit.

You see therefore that when you pay rates and taxes you are not safe from being charged not only the cost price of public services, but huge sums which go to private employers as unnecessary or excessive profits, to the landlords and capitalists whose land and capital these employers use, and to those property owners who hold the War Loan and the other stocks which represent the National Debt. But as you may also get back some of it as a pensioner or a recipient of public relief in some form or other, or as you may yourself be a holder of War Loan or Consols, or a shareholder in one of the commercial concerns which get contracts from the Government and the municipalities, it is impossible for me to say whether, on the whole, you gain or lose. I can only say that the chances are ten to one that you lose on balance; that is, that the rich get more out of you through the Government than you get out of them. So much for the taxes. Now for the rates.

31

YOUR RATES

The rates are not paid equally by everybody. The local authorities, like the Government, have to recognize the fact that some people are better able to pay than others, and make them pay accordingly. They do this by calculating the rates on the value of the house occupied by the ratepayer, and of his place of business, guessing that a person with a house or shop worth a hundred a year will be richer than one with a house or shop worth twenty, and rating him on the valuation.

Thus every rate is really a graduated income tax as well as a payment for public services. Then there are the municipal debts as well as the national debt; and as municipalities are as lazy and wasteful as central governments in the way of giving public jobs out to profiteering contractors, everything that happens with the taxes happens with the rates as well on a smaller scale.

But there are other anomalies which rating brings out.

Just consider what happens when even the quite genuine part of our national and municipal Communism, paying its way honestly by taxing and rating, is applied, as we apply it, to people of whom some are very poor and some are very rich. If a woman cannot afford to feed herself well enough to nurse her baby properly she clearly cannot afford to contribute to the maintenance of a stud of cream-colored ponies in the stables of Buckingham Palace. If she lives with her husband and children in a single room in a back-to-back dwelling in a slum, hopelessly out of reach of the public parks of the great cities, with their flowers and bands and rides and lakes and boats, it is rather hard on her to have to pay a share of the cost of these places of recreation, used largely by rich people whose horses and motor cars shew that they could easily pay a charge for admission sufficient to maintain the place without coming to her for a contribution.

In short, since communistic expenditure is compulsory expenditure, enforced on everybody alike, it cannot be kept within everybody’s means unless everybody has the same income. But the remedy is, not to abolish the parks and the cream-colored ponies, and to tell the Prince of Wales that he cannot have more than one suit of clothes until every poor woman’s son has two, all of which is not only impossible but envious and curmudgeonish, but to equalize incomes. In the meantime we must pay our rates and taxes with the best grace we can, knowing that if we tried to drag down public expenditure to the level of the worst private poverty our lives would be unendurable even by savages.

This, however, does not apply to certain ways in which the ratepayer is “exploited”. To exploit a person is to make money out of her without giving her an equivalent return. Now practically all private employers exploit the ratepayer more or less in a way that she never notices unless she has studied the subject as we are studying it at present. And the way they do it is this.

A woman who employs domestic servants gives regular employment to most of them; but to some she gives only casual employment. The housemaid and cook are in regular employment; the nurse is in temporary employment; and the charwoman is in casual employment: that is, she is taken on for a few hours or for a day, and then cast off to shift for herself as best she can until she gets another equally short job. If she is ill, none of her occasional employers need concern herself: and when rich people die and make provision for their servants in their wills, they never think of including a legacy for the charwoman.

Now no doubt it is very convenient to be able to pick up a woman like a taxi for an hour or so, and then get rid of her without any further responsibility by paying her a few shillings and turning her into the street. But it means that when the charwoman is ill or out of employment or getting so old that younger and stronger women are preferred to her, somebody has to provide for her. And that somebody is the ratepayer, who provides the outdoor relief and the workhouse, besides, as taxpayer, the old age pension and part of the dole. If the ratepayer did not do this the householder would have either to do without the charwoman or pay her more. Even regular servants could not, as at present, be discharged without pensions when they are worn out, if the ratepayers made no provision for them. Thus the householder is making the other ratepayers, many of whom do not employ charwomen, pay part of the cost of her domestic service.

But this is perhaps not the most impressive case, because you, as an experienced woman, can tell me that charwomen do not do so badly for themselves; that they are hard to get; and that steady ones often have their pick of several jobs, and make a compliment of taking one. But think of the great industrial concerns which employ huge armies of casuals. Take the dock companies for example. The men who load and unload the ships are taken on by the hour in hundreds at a time; and they never know whether there will be an hour’s work for them or eight hours, or whether they will get two days in the week or six. I can remember when they were paid twopence an hour, and how great a victory they were supposed to have gained when they struck for sixpence an hour and got it. The dock companies profit; but the men and their families are nearly always living more or less on the rates.

Take the extreme case of this. The ratepayers have to maintain a workhouse. If any man presents himself at that workhouse as a destitute person, he must be taken in and lodged and fed and clothed. It is an established practice with some men to live at the workhouse as ablebodied paupers until they feel disposed for a night of drinking and debauchery. Then they demand their discharge, and must be let out to go about their business. They unload a ship; spend all the money they earn in a reckless spree; and return to the workhouse next morning as destitute persons to resume their residence there at the ratepayers’ expense. A woman can do the same when there are casual jobs within her reach. This, I repeat, is the extreme case only: the decent respectable laborers do not do it; but casual labor does not tend to make people decent and respectable. If they were not careless, and did not keep up their spirits and keep down their prudence by drinking more than is good for them, they could not endure such worrying uncertainty.

Now, as it happens, dock labor is dangerous labor. In busy times in big docks an accident happens about every twenty minutes. But the dock company does not keep a hospital to mend its broken casuals. Why should it? There is the Poor Law Infirmary, supported by the ratepayers, near at hand, or a hospital supported by their charitable subscriptions; and nothing is simpler than to carry the victim of the accident there to be cured at the public expense without troubling the dock company. No wonder the dock company chairmen and directors are often among our most ardent advocates of public charity. With them it begins at home.

Another public institution kept by the ratepayers and taxpayers is the prison, with its police force, its courts of law, its judges, and all the rest of its very expensive retinue. An enormous proportion of the offences they deal with are caused by drink. Now the trade in drink is extremely profitable: so much so that in England it is called _The_ Trade, which is short for The Trade of Trades. But why is it profitable? Because the trader in drink takes all the money the drunkard pays for his liquor, and when he is drunk throws him into the street, leaving the ratepayer to pay for all the mischief he may do, all the crimes he may commit, all the illness he may bring on himself and his family, and all the poverty to which he may be reduced. If the cost of these were charged against the drink trade instead of against the police rates and poor rates, the profits of the trade would vanish at once.

As it is, the trader gets all the takings; and the ratepayer stands all the losses. That is why they made the trade unlawful in America. They shut up the saloons (public houses), and found immediately that they could shut up a good many of the prisons as well. But if they had municipalized the drink traffic: that is, if the ratepayer had kept the public house as well as the prison, the greatest care would have been taken to discourage drunkenness, because drunkenness would have produced a loss in the municipal accounts instead of a profit. As it is, the ratepayer is being exploited outrageously by the drink trade, and the whole nation weakened and demoralized in order that a handful of people may become unnaturally rich. It is true that they rebuild our tumble-down cathedrals for us occasionally; but then they expect to be made peers for it. The bargain is an insanely bad one anyhow.

There is one more trick that can be played on you both by the municipality and the Government. In spite of their obligation not to profiteer, but to give you every service at cost price, they often do profiteer quite openly, and actually boast of their profits as a proof of their business efficiency. This takes place when you pay for the service, not by a tax or a rate, but by the ordinary process of paying for what you consume. Thus when you want a letter sent, you pay the Government three halfpence across the counter for the job. When you live where electric light is made and supplied by the municipality, you do not pay for it in your rates: you pay so much for every unit you consume.

I am sorry to have to add that the Postmaster-General takes advantage of this to charge you more for carrying your letter than the average cost of it to the Post Office. In this way he makes a profit which he hands over to the Chancellor of the Exchequer, who uses it to keep down the income tax and supertax. You pay more that the income tax payers may pay less. A fraction of your three halfpence goes into the pockets of the millionaires. True, if you are an income tax payer you get a scrap of it back yourself; but as most people do not pay income tax and everybody buys at least a few postage stamps, the income tax payers in effect exploit the purchasers of stamps. The principle is wrong, and the practice a dangerous abuse, which is nevertheless applauded and carried to greater and greater lengths as the Government adds telegraphs to posts, telephones to telegraphs, and wireless to both.

In the case of a municipal electric lighting supply, I must tell you that in spite of the fact that the municipality, unlike a private company, has to begin paying off the cost of setting up its works from the moment it borrows it, and must clear it all off within a certain period, yet even when it does this and yet supplies electricity at a lower price than the private companies, it makes a profit in spite of itself. It applies the profit to a reduction of the rates; and the ratepayers are so pleased by this, and so accustomed to think that a business which makes profits must be a sound one, that the municipality is tempted to make a profit on purpose, and even a big one, by charging the consumer more than the supply costs. When this happens, it is clear that the overcharged people who use electric light are paying part of the rates of those who do not. Even if everybody used electric light there would still be inequalities in the consumption of current. A struggling shopkeeper, who must make his shop blaze with light to attract custom, must have a heavier bill for electric light than much richer people who have only their private houses to illuminate.

We must not spend any more time on your rates and taxes. If they were entirely abolished (how popular that would be!) and their places taken by profiteering charges for State and municipal services, the result would be, not State and municipal Socialism but State and municipal Capitalism. As it is, you can see how even in your rates, which ought to be quite free from the idler’s toll, you can be and to some extent are “exploited” just as you are in your ordinary shopping.

32

YOUR RENT

When we come from your rates and taxes to your rent, your grievance is far clearer, because when you pay your rent you have to hand your money directly to your exploiter to do what she or he likes with instead of to a public treasurer who gives you value for part of it in public service to yourself, and tells you nothing about the remainder which goes to septuagenarians, paupers, ground landlords, profiteering contractors, and so forth, some of whom are poorer than you, which makes for equality of income and is therefore a move in the right direction, and others richer, which aggravates inequality and is therefore a move in the wrong direction.

Rent paying is simpler. If you rent a piece of land and work on it, it is quite clear that the landlord is living on your earnings; and you cannot prevent him, because the law gives him the power to turn you off the land unless you pay him for leave to use it. You are so used to this that it may never have struck you as extraordinary that any private person should have the power to treat the earth as if it belonged to him, though you would certainly think him mad if he claimed to own the air or the sunlight or the sea. Besides, you may be paying rent for a house; and it seems reasonable that the man who built the house should be paid for it. But you can easily find out how much of what you are paying is the value of the house. If you have insured the house against fire (very likely the landlord makes you do this), you know what it would cost to build the house, as that is the sum you have insured it for. If you have not insured it, ask a builder what it would cost to build a similar house. The interest you would have to pay every year if you borrowed that sum on the security of the house is the value of the house apart from the value of the land.

You will find that what you are paying exceeds this house value, unless you are in the landlord’s employment or the house has become useless for its original purpose: for instance, a medieval castle. In big cities like London, it exceeds it so enormously that the value of the building is hardly worth mentioning in comparison. In out-of-the-way places the excess may be so small that it hardly goes beyond a reasonable profit on the speculation of building the house. But in the lump over the whole country it amounts to hundreds of millions of pounds a year; and this is the price, not of the houses, but of the landlords’ permission to live on the native earth on which the houses have been built.

That any person should have the power to give or refuse an Englishwoman permission to live in England, or indeed--for this is what it comes to--to live at all, is so absurdly opposed to every possible conception of natural justice that any lawyer will tell you that there is no such thing as absolute private property in land, and that the King, in whom the land is vested, may take it all back from its present holders if he thinks fit. But as the landlords were for many centuries also both the lawmakers and the kingmakers, they took care that, king or no king, land should become in practice as much private property as anything else, except that it cannot be bought and sold without paying fees to lawyers and signing conveyances and other special legal documents. And this private power over land has been bought and sold so often that you never know whether your landlord will be a bold baron whose ancestors have lived as petty kings on their tenants since the days of William the Conqueror, or a poor widow who has invested all her hardearned savings in a freehold.

Howbeit the fact remains that the case of landlord and tenant is one in which an idle and possibly infamous person can with the police at his back come quite openly to an industrious and respectable woman, and say, “Hand me over a quarter of your earnings or get off the earth”. The landlord can even refuse to accept a rent, and order her off the earth unconditionally; and he sometimes does so; for you may remember that in Scotland whole populations of fishermen and husbandmen with their families have been driven from their country to the backwoods of America because their landlords wanted the land on which they lived for deer forests. In England people have been driven from the countryside in multitudes to make room for sheep, because the sheep brought more money to the landlord than the people. When the great London railway stations, with their many acres of sidings, were first made, the houses of great numbers of people were knocked down, and the inhabitants driven into the streets; with the result that the whole neighbourhood became so overcrowded that it was for many years a centre of disease infecting all London. These things are still happening, and may happen to you at any moment, in spite of a few laws which have been made to protect tenants in towns in times of great scarcity of houses such as that which followed the war, or in Ireland, where the Government bought the agricultural land and resold it to the farmers, which eased matters for a time, but in the long run can come to nothing but exchanging one set of landlords for another.

It is in large towns and their neighbourhood that the Intelligent Woman will find not only how much the landlord can make her give up to him, but, oddly enough, how devoutly he believes in equality of income for his tenants, if not for himself. In the middle of the town she will find rents very high. If she or her husband has work to do there it will occur to her that if she were to take a house in the suburbs, where rents are lower, and use the tram to come to and fro, she might save a little. But she will find that the landlord knows all about that, and that though the further she moves out into the country the lower the rents, yet the railway fare or tram fare will bring up the yearly cost to what she would have to pay if she lived close enough in to walk to her market or for her husband to walk to his work. Whatever advantage she may try to gain, the landlord will snatch its full money value from her sooner or later in rent, provided it is an advantage open to everyone. It ought to be plain even to a fairly stupid woman that if the land belongs to a few people they can make their own terms with the rest, who must have land to live and work on or else starve on the highway or be drowned in the sea. They can strip them of everything except what is barely enough to keep them alive to earn money for the landowner, and bring up families to do the same in the next generation.

It is easy to see how this foolish state of things comes about. As long as there is plenty of land for everybody private property in land works very well. The landholders are not preventing anyone else from owning land like themselves; and they are quite justified in making the strongest laws to protect themselves against having their lands intruded on and their crops taken by rascals who want to reap where they have not sown. But this state of things never lasts long with a growing population, because at last all the land gets taken up, and there is none left for the later comers. Even long before this happens the best land is all taken up, and later comers find that they can do as well by paying rent for the use of the best land as by owning poorer land themselves, the amount of the rent being the difference between the yield of the poorer land and the better. At this point the owners of the best land can let their land; stop working; and live on the rent: that is, on the labor of others, or, as they call it, by owning.

When big towns and great industries arise, the value of the land goes up to enormous heights: in London bits of land with frontages on the important streets sell at the rate of a million pounds an acre; and men of business will pay the huge rents that make the land worth such a figure, although there is land forty miles away to be had for next to nothing. The land that was first let gets sublet, and yet again and again sublet until there may be half a dozen leaseholders and subleaseholders drawing more rent from it than the original ground landlord; and the tenant who is in working occupation of it has to make the money for all of them. Within the last hundred and fifty years villages in Europe and pioneer encampments in the other continents have grown into towns and cities making money by hundreds of millions; yet most of the inhabitants whose work makes all this wealth are no better off, and many of them decidedly worse off, than the villagers or pioneer campers-out who occupied the place when it was not worth a pound an acre. Meanwhile the landlords have become fabulously rich, some of them taking every day, for doing nothing, more than many a woman for sixty years drudgery.

And all this could have been avoided if we had only had the sense and foresight to insist that the land should remain national property in fact as well as in legal theory, and that all rents should be paid into a common stock and used for public purposes. If that had been done there need have been no slums, no ugly mean streets and buildings, nor indeed any rates or taxes: everybody would benefit by the rent; everybody would have to contribute to it by work; and no idler would be able to live on the labor of others. The prosperity of our great towns would be a real prosperity, shared by everyone, and not what it is now, the enslavement and impoverishment of nine persons out of every ten in order that the tenth should be idle and rich and extravagant and useless. This evil is so glaring, so inexcusable by any sophistry that the cleverest landlord can devise, that, long before Socialism was heard of, a demand arose for the abolition of all taxation except the taxation of landowners; and we still have among us people called Single Taxers, who preach the same doctrine.

33

CAPITAL

Now the Single Taxers are not wrong in principle; but they are behind the times. Out of landowning there has grown a lazier way of living on other people’s labor without doing anything for them in return. Land is not the only property that returns a rent to the owner. Spare money will do the same if it is properly used. Spare money is called Capital; its owner is called a capitalist; and our system of leaving all the spare money in the country in private hands like the land is called Capitalism. Until you understand Capitalism you do not understand human society as it exists at present. You do not know the world, as the saying is. You are living in a fool’s paradise; and Capitalism is doing its best to keep you there. You may be happier in a fool’s paradise; and as I must now proceed to explain Capitalism, you will read the rest of this book at the risk of being made unhappy and rebellious, and even of rushing into the streets with a red flag and making a greater fool of yourself than Capitalism has ever made of you. On the other hand, if you do not understand Capitalism you may easily be cheated out of all your money, if you have any, or, if you have none, duped into sacrificing yourself in all sorts of ways for the profit of mercenary adventurers and philanthropic humbugs under the impression that you are exercising the noblest virtues. Therefore I will risk letting you know where you are and what is happening to you.

Nothing but a very narrow mind can save you from despair if you look at all the poverty and misery around you and can see no way out of it all. And if you had a narrow mind you would never have dreamt of buying this book and reading it. Fortunately, you need not be afraid to face the truth about our Capitalism. Once you understand it, you will see that it is neither eternal nor even very old-established, neither incurable nor even very hard to cure when you have diagnosed it scientifically. I use the word cure because the civilization produced by Capitalism is a disease due to shortsightedness and bad morals: and we should all have died of it long ago if it were not that happily our society has been built up on the ten commandments and the gospels and the reasonings of jurists and philosophers, all of which are flatly opposed to the principles of Capitalism. Capitalism, though it has destroyed many ancient civilizations, and may destroy ours if we are not careful, is with us quite a recent heresy, hardly two hundred years old at its worst, though the sins it has let loose and glorified are the seven deadly ones, which are as old as human nature.

And now I hear you say “My gracious goodness me, what on the face of the earth has all this to do with the possession of spare money by ordinary ladies and gentlemen, which you say is all that Capitalism is?” And I reply, farfetched as it may seem, that it is out of that innocent looking beginning that our huge burden of poverty and misery and drink and crime and vice and premature death has grown. When we have examined the possibilities of this apparently simple matter of spare money, _alias_ Capital, you will find that spare money is the root of all evil, though it ought to be, and can be made, the means of all betterment.

What is spare money? It is the money you have left when you have bought everything you need to keep you becomingly in your station in life. If you can live on ten pounds a week in the way you are accustomed and content to live, and your income is fifteen pounds a week, you have five pounds spare money at the end of the week, and are a capitalist to that amount. To be a capitalist, therefore, you must have more than enough to live on.

Consequently a poor person cannot become a capitalist. A poor person is one who has less than enough to live on. I can remember a bishop, who ought to have known better, exhorting the poor in the east end of London, at a time when poverty there was even more dreadful than it is at present, to become capitalists by saving. He really should have had his apron publicly and officially torn off him, and his shovel hat publicly and officially jumped on, for such a monstrously wicked precept. Imagine a woman, without enough money to feed her children properly and clothe them decently and healthily, letting them starve still more, and go still more ragged and naked, to buy Savings Certificates, or to put her money in the Post Office Savings Bank and keep it there until there is enough of it to buy stocks and shares! She would be prosecuted for neglecting her children: and serve her right! If she pleaded that the bishop incited her to commit this unnatural crime, she would be told that the bishop could not possibly have meant that she should save out of her children’s necessary food and clothing, or even out of her own. And if she asked why the bishop did not say so, she would be told to hold her tongue; and the gaoler would be ordered to remove her to the cells.

Poor people cannot save, and ought not to try. Spending is not only a first necessity but a first duty. Nine people out of ten have not enough money to spend on themselves and their families; and to preach saving to them is not only foolish but wicked. Schoolmistresses are already complaining that the encouragement held out by Building Societies to poor parents to buy their own houses has led to the underfeeding of their children. Fortunately most of the poor neither save nor try to. All the spare money invested in the Savings Banks and Building Societies and Co-operative Societies and Savings Certificates, though it sounds very imposing when it is totalled up into hundreds of millions, and all credited to the working classes, is such a mere fleabite compared to the total sums invested that its poor owners would gain greatly by throwing it into the common stock if the capital owned by the rich were thrown in at the same time. The great bulk of British capital, the capital that matters, is the spare money of those who have more than enough to live on. It saves itself without any privation to the owner. The only question is, what is to be done with it? The answer is, keep it for a rainy day: you may want it yet. This is simple; but suppose it will not keep! Of course Treasury notes will keep; and Bank notes will keep; and metal coins will keep: and cheque books will keep; and entries of sums of money in the ledgers in the bank will keep safely enough. But these things are only legal claims to the goods we need, chiefly food. Food, we know, will not keep. And what good will spare money be to us when the food it represents has gone rotten?

The Intelligent Woman, when she realizes that money really means the things that money can buy, and that the most important of these things are perishable, will see that spare money cannot be saved: it must be spent at once. It is only the Very Simple Woman who puts her spare money into an old stocking and hides it under a loose board in the floor. She thinks that money is always money. But she is quite wrong in this. It is true that gold coins will always be worth the metal they are made of; but in Europe at present gold coins are not to be had: there is nothing but paper money; and within the last few years we have seen English paper money fall in value until a shilling would buy no more than could be bought for sixpence before the war, whilst on the Continent a thousand pounds would not buy a postage stamp, and notes for fifty thousand pounds would hardly pay a tram fare. People who thought themselves and their children provided for for life were reduced to destitution all over Europe; and even in England women left comfortably-off by insurances made by their fathers found themselves barely able to get along by the hardest pinching. That was what came of putting their trust in money.

Whilst people were being cheated in this fashion out of their savings by Governments printing heaps of Treasury notes and Bank notes with no goods at their back, several rich men of business became enormously richer because, having obtained goods on credit, they were able to pay for them in money that had become worthless. Naturally these rich men of business used all their power and influence to make their Governments go from bad to worse with their printing of bogus notes, whilst other rich men of business who, instead of owing money were owed it, used their influence in the opposite direction; so that the Governments never knew where they were: one set of business men telling them to print more notes, and another set to print less, and none of them seeming to realize that they were playing with the food of the people. The bad advice always won, because the Governments themselves owed money, and were glad enough to pay it in cheap paper, following the example of Henry VIII, who cheated his creditors by giving short weight in his silver coins.

The Intelligent Woman will conclude, and conclude rightly, that hoarding money is not a safe way of saving. If her money is not spent at once she can never be sure what it will be worth ten years hence, or ten weeks or even ten days or minutes in war time.

But you, prudent lady, will remind me that you do not want to spend your spare money: you want to keep it. If you wanted anything that it could buy it would not be spare money. If a woman has just finished a good dinner it is no use advising her to order another and eat it immediately so as to make sure of getting something for her money: she had better throw it out of the window. What she wants to know is how she can spend it and save it too. That is impossible; but she can spend it and increase her income by spending it. If you would like to know how, read the next chapter.

34

INVESTMENT AND ENTERPRISE

If, having finished your dinner, you can find a hungry person who can be depended on to give you a dinner, say after a year’s time, for nothing, you can spend your spare money in giving him a dinner for nothing; and in this way you will in a sense both spend your money on the spot and save it for next year, or, to put it the other way, you will have your spare food eaten while it is fresh and yet have fresh food to eat a year hence.

You will at once reply that you can find a million hungry persons only too easily, but that none of them can be depended on to provide a dinner for themselves, much less for you, next year: if they could, they would not be hungry. You are quite right; but there is a way round the difficulty. You will not be able to find dependable men who are hungry; but your banker or stockbroker or solicitor will find you plenty of more or less dependable persons, some of them enormously rich, who, though overfed, are nevertheless always in want of huge quantities of spare food.

What do they want it for? Why, to feed the hungry men who cannot be depended on, not on the chance of their returning the compliment next year, but for doing some work immediately that will bring in money later on. There is nothing to prevent any Intelligent Woman with spare money enough from doing this herself if she has enough invention and business ability.

Suppose, for instance, she has a big country house in a big park. Suppose her park blocks up the shortest way from one important town to another, and that the public roads that go round her park are hilly and twisty and dangerous for motor cars. She can then use her spare food to feed the hungry men while they make a road for motors through her park. When this is done she can send the hungry men away to find another job as best they can, leaving herself with a new road for the use of which she can charge a shilling to every motorist who uses it, as they all will to save time and risk and difficulty. She can keep one of the hungry men to collect the shillings for her. In this way she will have changed her spare food into a steady income. In city language, she will have gone into business as a roadmaker with her own capital.