Quite another thing is Distribution in the technical Economic sense. In this sense Distribution is the apportionment of Labor-produced Wealth in appropriate categories with reference to the Economic relationship of Labor to Land—of Man to Natural Resources.
A better term than Distribution, since this term has been so much abused by giving to it the sense of delivery by transportation (a mere phase of Production), would probably be Division. But Distribution of Wealth has too long served as the technical term for the Economic division or sharing of Wealth, to be discarded offhand.
Although the Distribution of Wealth in appropriate shares, with reference to the Economic relationship of Labor to Land, affects the sharing of Wealth by individuals, it does not completely dictate either the proportions or the magnitude of individual shares. These may be determined not only by natural Economic law but also by purchase, by common usage, by conventional inheritance statutes, by highway robbery, by forgery, by burglary, by petty theft, by “confidence” tricks, by lucky speculation or gambling games, by beggary, by “crooked business,” by generous gifts, by legal distortions, by taxation, by a thousand and one other influences, legitimate or illegitimate, outside the jurisdiction of natural Economic law. Radically different are those fundamental Economic apportionments in Distribution with reference to the natural relations of Labor to Land.
Fundamentally, Economic Distribution is a twofold apportionment of the Wealth produced by Labor from and upon Land, whereby one portion is naturally allocated to Labor as its producer and the other to Land-ownership as the controller of Natural Resources and sites.
Presumably, then, as Production of Wealth has two Basic factors—in technical terms Labor and Land, in other terms Man and Natural Resources—so Distribution of Wealth has two basic apportionments, one corresponding to the Labor or Man factor in Production, the other to the Land or Natural Resource factor—Wages for Labor, Rent for permission to use Land.
That there can be neither Wages for Labor nor Rent for Land unless Wealth has been produced, is a manifest law of nature. The nonexistent being naturally indivisible, Production of Wealth must precede Distribution of Wealth. Inasmuch, then, as Labor produces all Wealth and without Labor no Wealth is or can be produced, some Wealth must naturally be distributed or allocated to Labor as Wages before any can be distributed or allocated to Land-ownership as Rent.
Consequently, the Wages allocation of Wealth demands consideration first.
I. Wages for Labor
As with many another abuse of technical Economic terms, so colloquial and business interpretations have distorted the significance of the technical term Wages. Even Economic teachers allow their imaginations to glide away from the comprehensive significance of this technical term much as they do from its corresponding technical term Labor.
All too readily does conventional Economic thought, when considering Wages, center upon the compensation which “shirt-sleeve” classes of hired men bargain for, “salaries” taking the place of “wages” when “white collar” workers cross the business line of vision. Still more select levels of Labor are compensated with “fees,” “commissions,” or “profits.” To thinking students, however, students of Economics who recognize Economics as a science subject to natural law rather than a grouping of arbitrary business customs—to such students all special or mere conventional kinds of compensation for human service assemble themselves naturally in the same fundamental category, and for clarity of thought are always distinguished by the same technical term.