Speculations from Political Economy

by Charles Baron Clarke

This phrase is liberally used but rarely defined. Different orators appear to have quite different ideas as to what it means; and when they explain what they suppose it to mean, they generally prove that, in the way they understand it, it would be serious national damage.

It is unnecessary to observe that landlords now (omitting individual exceptions and idiosyncrasies) expend their best endeavours in getting the best rent they can for their land. They have no prejudices in favour of farms of a particular size; a landlord of a farm of 1000 acres would let it directly in five-acre plots if he could get a better (and equally certain) gross rent by so doing. "Nationalisation" is often taken to mean that Government is to buy land and let it out in small plots. But apart from expense of Government management and objections to Government interference, we may safely assume that there would be a national loss by this procedure: the private owner would discover very quickly if he could make a profit by letting his farms piecemeal.

All Government interference can do to improve the produce of the land is to abolish all restrictive laws, and to make the general tenure of land such that every piece of land shall fall into the hands of that man who is able to make the most of it. The National Rate Book now suggested is designed to accomplish this end. We will subsequently consider how it might assist public companies. As the suggested way of getting a National Rate Book is at first sight rather startling, I would premise that it is no rash invention of mine; it worked admirably in Attica—as see Demosthenes or Boeckh.

To make the National Rate Book, each landowner values (with the magistrate) his land at what price he pleases; the State has the right to buy the land at any time at that price, plus 33-1/3 per cent for compulsory purchase. The magistrate sees that each separate house, farm, and plot is valued separately. No person need prove his title; any man can value any piece of land, and need not prove himself to be owner, tenant, or agent; but any piece of land valued by no one would be claimed as public property.

A man who valued himself unfairly low would not be bought out at once and dispossessed by Government, unless it happened that during that year his land was taken up by Government or by a railway company for some public purpose. The regular course of business would be as follows:—An owner A would put his house and curtilage in the Rate Book at £1200. The sycophant B would come to the magistrate, offer £1600 for the property, and lodge the £1600 with the magistrate. The magistrate then, without divulging the name of the sycophant, would write to A either to rate his house at £1600 (paying a fine for so doing), or to take £1600 for it. If he took the £1600, B would get the property, and Government the increased rate. If A preferred raising his rateable value to £1600, B would get the fine, Government would get the increased rate.

The utmost pressure put upon any owner under this system would be that, if he would not pay rates on x pounds for his property, he would lie obliged to take x pounds for the property.

The 33-1/3 per cent for compulsory purchase is illusory, and I have only put it in the statement of the scheme to meet an objection which I know to be common (and equally illusory). It is clear that if I know I am going to get 33-1/3 per cent for compulsory purchase, whether from Government or a secret sycophant, I shall proportionately undervalue my property. Thus if I estimate the real value of my house and curtilage at £1200, and feel that I do not care if I sell at that price, I shall put it down in the Rate Book at £900. This applies to all owners, so that the allowance for compulsory sale would only artificially depreciate by one-fourth all the rateable values put down in the magistrate's book.

I have not stopped to cumber the statement of this simple plan by adding the details necessary to meet severance of a farm by a railway company, etc. The provisions to meet complicated tenures, etc., would run much the same as in the Lands Clauses Consolidation Act.

It will be at once seen that this form of Rate Book would really nationalise the land by bringing each piece into the hands of him who could make most out of it. If I saw my way to use a piece of laud so that it should be worth £1000 to me, and if on looking into the Rate Book I saw that the present owner only considered it worth £600 to him, I should at once lodge my £900 with the magistrate. A few owners would really feel as Naboth. They could indulge this feeling by putting a very high rateable value on their property. The high rates they would thus have to pay would be the due ransom of the land; but in general every piece of land would pass into the hands of him who could make most of it. There would spring up, as in Attica, a large class of professional sycophants. By their incessant operations, properties small and great would be continually passing from the slothful and the old-fashioned to the enterprising and modern-educated. No nationalisation of the land could get so much out of it or conduce so highly to progress as the National Rate Book. We should have companies and adventurers buying up all sorts of pieces of land, just as formerly they speculated in taking up land for mining in Cornwall. We should see an extraordinary activity in the employment of capital in England.

For all public improvements, as a new street or a Government military station, a few minutes with the map and Rate Book would show the Government officer or engineer the best route or plot to take, and would also show him the exact cost of the land for the scheme. There would be no law expenses, no prolonged fights, no juries, no arbitrations.