The personal property of the country is valued at less than one fourteenth of the total wealth. It is in reality a negligible item, as compared with the value of the real property, of the public utilities, and of the raw materials and products of industry.
The wealth of the United States is in permanent form—land and improvements; personal possessions are a mere incident in the total. In truth, American wealth is in the main productive (business) wealth, designed for the further production of goods, rather than for the satisfaction of human wants.
3. Ownership and Control
Who owns this vast wealth? It is impossible to answer the question with anything like definiteness. Figures have been compiled to show that five per cent of the people own two-thirds to three-quarters of it; that the poorest two-thirds of the people own five per cent of it, and that the well-to-do or middle class own the remainder. These figures would make it appear that more than one-fourth of the population is in the middle class. If the income-tax returns are to be trusted this proportion is far too high. On all hands it is admitted that the wealth of the country is concentrated in the hands of a small fraction of the people and the important wealth—that is, the wealth upon which production, transportation and exchange depends—is in still fewer hands.
Neither the total wealth of the country, nor that portion of the total which is owned directly by the propertied class is of most immediate moment. Ownership does not necessarily involve control. A puddler in the Gary Mills may own five shares of stock in the Steel Corporation without ever raising his voice to determine the corporation policy. This is ownership without control. On the other hand, a banking house through a voting trust agreement, may control the policy of a corporation in which it does not own one per cent of the stock. This is control without ownership. Ownership may be quite incidental. It is control that counts in terms of power.
Most of the property owners in the United States play no part in the control of prices or of production, in the direction of economic policy, or in the management of economic affairs.
Theoretically, stockholders direct the policies of corporations, and, therefore, each holder of 5 or 10 shares of corporate stock would play a part in deciding economic affairs. Practically, the small stockholder has no part in business control.
The small farmer—the small business man of largest numerical consequence—has been exploited by the great interests for two generations. Despite his numbers and his organizations, despite his frequent efforts, through anti-trust laws, railway control laws, banking reform laws, and the like, he has little voice in determining important economic policies.
The small savings bank depositor or the holder of an ordinary insurance policy is a negative rather than a positive factor in economic control. Not only does he exercise no power over the dollar which he has placed with the bank or with the insurance company, but he has thereby strengthened the hands of these organizations. Each dollar placed with the financier is a dollar's more power for him and his.
Suppose—the impossible—that half of the families in the United States "own property." Subtract from this number the small stockholders; the holders of bonds, notes and mortgages; the small tradesman; the small farmer; the home owner and the owner of a savings-bank deposit or of an insurance policy—what remains? There are the large stockholders, the owners and directors of important industries, public utilities, banks, trust companies and insurance companies. These persons, in the aggregate, constitute a fraction of one per cent of the adult population of the United States.