[1196] Principles, Book V, chap. 2, § 5. Cf. also chap. 3, §§ 2 and 6. For the programme of the League see Dissertations and Discussions, vol. iv.
[1197] Mill thought it impossible to distinguish in individual cases between the surplus value which is due to general circumstances and the surplus that results from the expenditure undertaken by the proprietor. Hence his conclusion that a general tax was the most equitable method of procedure with a view to effecting confiscation.
[1198] Dissertations and Discussions, vol. iv, p. 256.
[1199] Progress and Poverty was not his first effort, however. In 1871 Our Land and Land Policy had appeared, and in 1874 The Land Question. Later still he published Protection or Free Trade (1886), in which he puts forward a strong case for Free Trade, and in 1891 An Open Letter to Pope Leo XIII on the condition of the workers.
[1200] Clark in his Distribution of Wealth states that the method by which he tries to determine the exact productivity of each factor of production is one that he borrowed from Henry George.
[1201] “Twenty men working together will, where nature is niggardly, produce more than twenty times the wealth that one man can produce where nature is most bountiful.” Cf. also the whole of Book II, which is a disproof of the Malthusian theory.
[1202] “Labour and capital are but different forms of the same thing—human exertion. Capital is produced by labour; it is, in fact, but labour impressed upon matter.… The use of capital in production is, therefore, but a mode of labour.… Hence the principle that, under circumstances which permit free competition, operates to bring wages to a common standard and profits to a substantial equality—the principle that men will seek to gratify their desires with the least exertion—operates to establish and maintain this equilibrium between wages and interest.… And this relation fixed, it is evident that interest and wages must rise and fall together, and that interest cannot be increased without increasing wages, nor wages be lowered without depressing interest.” (Progress and Poverty, Book III, chap. 5.) It is hardly necessary to point out how very much simplified this doctrine concerning the relation between wages and interest really is.
[1203] A résumé of this theory of distribution, whose very simplicity must make it suspect, may be found in Book V, chap. 2: “In every direction, the direct tendency of advancing civilisation is to increase the power of human labour to satisfy human desires—to extirpate poverty and to banish want and the fear of want.… But labour cannot reap the benefits which advancing civilisation thus brings, because they are intercepted. Land being necessary to labour, and being reduced to private ownership, every increase in the productive power of labour but increases rent—the price that labour must pay for the opportunity to utilise its power; and thus all the advantages gained by the march of progress go to the owners of land, and wages do not increase.” George, however, does not claim that real wages have fallen because technical improvements enable production to be carried on where it was formerly impossible. At most this will only enable capital and labour to preserve their old scale of remuneration; it will not give them any share in the progress that has been made, so that, relatively speaking, it is true to say that wages and interest have both fallen in comparison with rent. “When I say that wages fall as rent rises, I do not mean that the quantity of wealth obtained by labourers as wages is necessarily less, but that the proportion which it bears to the whole produce is necessarily less. The proportion may diminish while the quantity remains the same, or even increases.” (Book VI, chap. 6. Cf. also Book IV, chap. 3.) George, like Ricardo and a good many socialists, confuses two different problems, namely, the price of productive services and the proportional distribution of the product between the different agents of production (Book V). He adds, however, that scientific discovery, by pushing the margin of cultivation back to that point where the law of diminishing returns is more than counterbalanced by increased productive efficiency, may even sometimes reduce the worker’s real wages, and so impair his position not only relatively, but also absolutely. (Book IV, chap. 4.)
[1204] Ibid., Book V, chap. 2.
[1205] That portion of their revenue which represented the capital sunk in the land would still be the property of the landowners.