“If,” says Walras, “the State pays to the proprietors the exact value of their lands, reckoning in that price a sum equal to the estimated value of the future rent, what is it going to gain by the bargain?” If the value of the soil is carefully computed in the manner indicated above, then the interest on the capital borrowed to effect the purchase and the rents received must exactly balance one another, for one is just the price of the other, and the State will find that the rent of land is insufficient to repay the outlay involved. The results will cancel one another. Some inconveniences will doubtless be avoided, but there will be no outstanding advantage. How are we to get rid of this objection?
The difficulty is soon removed, for once the system outlined above is adopted there will be an end to all speculation in land. When individual buyers find that they must pay the owners a price that covers all surplus values which the land may possibly yield in the future, which would mean that they would not get any of that surplus value themselves, they will not be quite so keen. This is not the case, however, at the present time. Speculation of this kind is rife everywhere, for the good reason that a surplus value is always a possible contingency. The more perspicacious or better informed a buyer is, the more firmly does he believe in this advance and the more careful is he to safeguard his future interests. The State, so soon as it has bought back the land, will be in the position of the speculator in question. Walras is of the opinion that the surplus value is certain to grow in future even more rapidly than the actual possessors of the land imagine. Thanks to economic evolution, what the private proprietor can only speculate on the State can rely upon with absolute certainty.[1221]
“I believe, along with several competent economists, that when humanity left the purely agricultural system under which it had lived for thousands of years and entered upon a régime of industry and commerce, under which agriculture is still necessary to feed a growing population, but only possible with the expenditure of a vast amount of capital, it achieved a notable triumph, and the step it then took marks a veritable advance in economic evolution. I also believe that as the result of this evolution rent will continue to grow, but without involving any scarcity or increase in the value of agricultural produce—a fact that has escaped everyone except the wideawake and the well-informed, and by which proprietors alone have profited. I further believe that if the State had bought the land before this evolution had taken place and had then given of its resources to further such development, even the normal growth of this surplus value would have been ample to clear the debt.”[1222]
Walras agrees with Ricardo, and a kind of rehabilitation of the Ricardian thesis drives him to the conclusion that the future must witness a further growth of this surplus value of land—merely because of the limited quantity of land in existence. There is this difference, however. Whereas Ricardo bases his whole contention upon the validity of the law of diminishing returns, Walras will not even entertain the thought of a possible diminution in the amount of agricultural produce. The inevitable progress of society which leads it on from a purely agricultural stage right up to the industrial-commercial stage, from extensive to intensive cultivation, must result in increasing the value of land. The State would ease this transitional process by a measure of appropriation, and could make a solid contribution to the success of this gigantic undertaking, which is to apply not merely to land, but also to railways and mines, etc.[1223]
(c) Numerous and various are the reasons invoked by the advocates of land nationalisation. Gossen’s ideal is the maximum product, while Walras’s first care is to supply the State with all necessary resources. A final class of writers regards it as an excellent opportunity of giving everybody access to the soil. It was this ideal of free land that inspired the late Alfred Russel Wallace to write his book Land Nationalisation: its Necessity and its Aims, and to inaugurate his campaign in favour of nationalisation in 1882.
Wallace imagined that the mere right of free land would put an end for ever to the worker’s dependence upon the goodwill of the capitalist. Nobody would be found willing to work for starvation wages were everyone certain that on a free piece of land he would always obtain his daily bread. None would suffer hunger any longer, for the soil, at any rate, would always be there awaiting cultivation. Free access to the land would by itself solve the problem of poverty and want, and this would be by no means one of the least of the benefits of land nationalisation.[1224]
The essential thing, in his opinion, is to give to every worker the right to possess and to cultivate a portion of the soil.[1225] His proposal is that once nationalisation is an accomplished fact every individual at least once in his lifetime should be given the opportunity of choosing a plot of land of from one to five acres in extent wherever he likes on condition that he personally occupies and cultivates it.[1226]
The extremely simple character of the proposal makes it all the more notorious. Unlike the other schemes, it is not based upon any subtle, complex economic analysis. But it supplies a most convincing platform theme. Closer scrutiny, however, reveals its almost childish nature.
The cultivation even of the smallest piece of land requires some capital, which the advocates of free land appear to forget altogether. The amount of capital so required may not infrequently be in excess of the modest sum possessed by the working man. They also seem oblivious of the fact that the land does not produce all the year round: there must of necessity be a period of quiescence when the seeds are germinating. And if we are to suppose that the worker has sufficient reserve to wait for the harvest, why not admit at once that he has also enough to tide over a period of unemployment? A few pounds in the bank to which he can have access whenever he likes would certainly be much more serviceable in mid-winter, say, than a plot of land situated some distance away. Cultivation also requires capacity as well as capital. You cannot improvise the peasant, and a first-class artisan may be a very indifferent cultivator. The experience of distress committees seems to prove this point. The advocates of free land have a mistaken belief in the efficacy of the proposed remedy, and experience would quickly show them how difficult it would be to apply it.[1227]