THE DIFFUSION OF PROPERTY.
WE do not believe in the " influence " which alarmists assume Mr. George to exercise over the lower classes in this country. We know that the few Socialists who flourish in this land of stiff-necked individualities, though they admire his thorough-going contempt for the Eighth Commandment, despise and dislike his project for making the State universal landlord, and we see no evidence that ordinary wage-earning Englishmen have the slightest belief that they can begin a millennium with universal robbery. There is a vague dislike prevalent to vast aggregations of land, and to the devotion of huge tracts to the sporting pleasures of the very rich ; and in the Highlands there is an idea, scarcely formulated, that when labourers want unused land, and are willing to pay rent for it, the owner should be compelled either to rent it out, or sell it to those who wilL Bat beyond this, we see little trace of any serious desire, far less of any seri- ous design, either to confiscate or to expropriate the soil. Certainly, there is not a Member who would not lose his seat if he asked permission to bring in such a Bill. But we do see evidence that while repudiating Mr. George's pro- posals, the more advanced politicians are studying the possi- bility of a wider diffusion of existing wealth ; and that the desire to reduce the present inequalities, instead of allowing them to become worse and worse, is taking hold of many serious minds. As yet, the leaders scarcely see their way, bat in every Liberal speech there is evidence that old ideas on the subject are loosening ; that the rich are alarmed by the few- ness of their own class, and the philanthropists uneasy at the luxury around them ; and that any statesman who produced any plan by which property could be more freely divided with- out confiscation, would soon find a formidable party behind him. It is worth while, therefore, to examine for a moment whether any long step in that direction is theoretically possible.
It will hardly be made by any of the proposals now before the public. The old one which haunts some public men— and which we are struck to see lingers in the mind of Mr. Chamberlain, who is essentially Democrat, and not Socialist ; that is, who seeks equal rights for all, and not a fusion of the rights of all in one corporate right—the proposal that the State should take, or should heavily tax, "unearned incre- ment," cannot be made to work. It is wit unjust in itself, but it could not be applied to land only without con- fiscation; if applied to personalty, it would be a fine upon sound judgment and business capacity, or would produce a paralysis of commerce ; and it is hampered from the first by that insoluble difficulty of compensation for unearned de- crement. It seems easy to say that the Duke of Bedford should give up half the increased value upon his metropolitan property, which he did nothing to develope ; but to take it would be unjust, unless we took also half the increase upon at least sleeping capital like Consols. "I," say," bought Italian Bonds in 1852 at 50. I have done nothing for Italy. Never- theless, though I have had 5 per cent, ever since, that is, my money nearly twice over, my bonds are selling at 90." If that is not "unearned increment," what is I Yet if half that is to be taken away, there is an end of investment and business together. The Bonds with that liability on them would be, to begin with, unsaleable, except after an investigation into the history of each bond. Or, to take as common a case, "I inherit at' five years old a brewery or other business of £5,000 a year. The trustees manage it so well that at twenty-one, instead of receiving a business worth £5,000 a year and the accumulations, I receive the accumulations and £10,000 a year. How have I earned that increment I have not earned it. Yet if half is taken away, half my trustees' motive for energy is gone, and half the labour by which they intended to benefit me is rendered useless." Such a scheme will not only not work, it is so opposed to human nature on its best as well as on its worst side that it will never be tried, and the unearned increment must be left to its natural owner, just as a mine would be left to Lord Fitzwilliam, if somebody found one on his land. That is unearned increment, too, on a huge scale.
Nor have we much confidence in "progressive death duties," duties, that is, varying with the amount to be inherited. They could be levied on the land, though they would decrease its value ; but it is doubtful if they could be levied on persorralty. Too many people would transfer their money abroad, and the Jews, who invented bills of exchange to defeat these very devices, would organise for a profit a system of foreign trusts which would rob the Exchequer of half its prey. It is often asserted that this would be difficult in practice. but it would be difficult only to the poor. The very rich manage it already, as anybody may know who reads the wills of the cosmopolitan capitalists, or inquires where the monastic Orders hold their funds, or asks in Geneva why the Genevese rich die
apparently poor, or studies for a few hours the actual management of arbitrage. What is to stop Mr. Holloway from holding American Three per Cents. in New York, in-: stead of English Consols in London And remember, it is the rich, not the poor, whom you want to catch in the net of the progressive death duties. We doubt whether, if the State took half on fortunes, say, above a quarter of a million, the Exchequer would ever get sixpence. Lear would risk a Regan rather than be despoiled, or keep his money in foreign bonds, to be sent abroad when he got ill. Moreover, that plan, though it would occasionally reduce great fortunes, would not diffuse property at all, would rather in some instances lead to vast hoardings, intended to make a sum so large that even the State demand would leave it a grand fortune. Mr. Broadhurst's idea of allowing leaseholders to claim pre-emption would be more effective for diffusion than that, though it would not work for long, as leases would be abandoned in favour of tenancy-at-will, the landlord himself building and repairing his houses, as Mr. Astor does in New York.
And lastly, a direct statutory limitation on accumulation could not be made to work. We are ashamed to mention so silly a scheme among alternatives, but that, to our amaze- ment, we find it continually mentioned in private conversa- tion, just as it is publicly on the Continent, as something within the range of human power. It is not within its range. The effort to arrest hoarding has been made a thousand times, by every possible variety of tyrant, and has always failed. The State may make it death for me to hold more than a square mile of land, but it cannot prevent my friends from holding it for me, as used to be done in Ireland, or me from holding mort- gages over it, or from lending money to its nominal owner, receiving a rental under colour of interest. Still less can the State prevent my concealing a certificate of shares in the Bank of France, or even keeping in a safe place a barrel of bank- notes. These schemes are tried and exploded oppressions, and in our complex civilisation, when a capitalist can remit half a million to Chicago and draw it there before Time has caught up the message, they are as ridiculous as laws limiting interest to five per cent., which the usurer met by writing £150, instead of £100. Statesmen, moreover, are not going to attack civilisation in that way ; and if the demagogues do, the workmen will find out in a year that the wage fund is dying of atrophy, and will give the demagogues as bad a quarter of an hour as the Irish, if they are ever "free," will give the Parnellite Members.
Every one who thinks out the subject will, we believe, come back to the old opinion, long since embodied in law upon the Continent,—that the only mode of diffusing property at once honest and effective is to pass a new "Statute of Distributions" directed to that end, that is, in fact, to terminate the freedom of bequest. If property after death must be divided, it will gradually be diffused, as it has been everywhere but in Eng- land. Even diffusion by intestacy, as Mr. Bright recom- mends, would do much, for law produces opinion, and in half a century a will enriching one child and starving the remainder would be considered immoral ; but a peremptory law would operate more certainly, and faster. The property need not go to the children, if that kind of perpetual entail is contrary to our manners. It is only necessary to insist that the number of portions distributed by the will shall not be less than the number of "natural heirs," and then define in a single clause who the natural heirs are. That would leave a great liberty of bequest, and only destroy the liberty of continuous aggregation. Under such a law, in thirty years the great estates would have faded away, and there would be five times as many proprietors as there are now ; while in sixty years, men with some property, however small, would be in a majority. That would be an effective scheme, and also honest ; and there is no other, and never will be any other, which unites those qualifications. We do not believe the country is in the least prepared for such a scheme, which has not been adopted by any American State or any English Colony, which is regarded with bitter aversion by all Conservatives, and which is checked at the very outset by the dislike of parents, who see that in England the right of bequest is the last relic of the patriapotestas, which on the Continent survives in much directer forms. But though the country is not prepared for any such plan, we believe that a party not unfavourable to it is growing up, and that when democracy rules, its determination not to be so poor will ultimately drive it in this direction. We expect within five years to hear such a project ehadowed out by states. men, and within twenty to see a dissolution intended to bring the question plainly before the people. They, after their
historic fashion, will probably hit upon some odd compromise; but diffusion not being contrary to the Decalogue, and being in accordance with the manners of the middle class, it will, we believe, in some form and with some limitations, be adopted.
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