Econlib

The Library

Other Sites

 Front Page arrow Titles (by Subject) arrow 427.: THE RIGHT OF PROPERTY IN LAND EXAMINER, 19 JULY, 1873, PP. 725-8 - The Collected Works of John Stuart Mill, Volume XXV - Newspaper Writings December 1847 - July 1873 Part IV

Return to Title Page for The Collected Works of John Stuart Mill, Volume XXV - Newspaper Writings December 1847 - July 1873 Part IV

Search this Title:

Also in the Library:

Subject Area: Political Theory
Collection: The Collected Works of John Stuart Mill

427.: THE RIGHT OF PROPERTY IN LAND EXAMINER, 19 JULY, 1873, PP. 725-8 - John Stuart Mill, The Collected Works of John Stuart Mill, Volume XXV - Newspaper Writings December 1847 - July 1873 Part IV [1847]

Edition used:

The Collected Works of John Stuart Mill, XXV - Newspaper Writings December 1847 - July 1873 Part IV, ed. Ann P. Robson and John M. Robson, Introduction by Ann P. Robson and John M. Robson (Toronto: University of Toronto Press, London: Routledge and Kegan Paul, 1986).

Part of: Collected Works of John Stuart Mill, in 33 vols.

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


427.

THE RIGHT OF PROPERTY IN LAND

EXAMINER, 19 JULY, 1873, PP. 725-8

This is the last of three articles on land reform (see Nos. 425-6). Not listed in Mill’s bibliography, it appeared posthumously, headed as title, in the “Political and Social” section of the Examiner, Mill having died in Avignon on 7 May, 1873. A footnote to the title reads: “We regret that, owing to unexpected delays, it has not been possible to compare the following paper with the original manuscript of Mr. Mill. This paper was written for the Land Tenure Reform Association.—Ed. Ex.” It appeared as a pamphlet, The Right of Property in Land. Reprinted from the Examiner of July 19, 1873 (London: Dallow, [1873]), and, edited by Helen Taylor, in Dissertations and Discussions, Vol. IV, pp. 288-302. A version printed from the MS (now lost) appeared as Appendix B in The Letters of John Stuart Mill, ed. Hugh S.R. Elliot, 2 vols. (London: Longmans, Green, 1910), Vol. II, pp. 387-95. The text below is that of the Examiner, which has been collated with those of the pamphlet, Dissertations and Discussions, and Elliot. In the variant notes, “E” signals Elliot’s version, and “P” signals the pamphlet and Dissertations and Discussions (which agree in substantives).

rights of property are of several kinds. There is the property which a person has in things that he himself has made. There is property in what one has received as a recompense for making something for somebody else, or for doing any service to somebody else, among which services must be reckoned that of lending to him what one has made, or honestly come by. There is property in what has been freely given to one, during life or at death, by the person who made it or honestly came by it, whatever may have been the motive of the gift,—personal affection, or because one had some just claim on him, or because he thought one would use it well, or as he would a wish it to be used. All these are rights to things which are the produce of labour; and they all resolve themselves into the right of every person to do as he pleases with his own labour, and with the produce or earnings of his labour, either by applying them to his own use, or exchanging them for other things, or bestowing them upon other persons at his own choice.

But there is another kind of property which does not come under any of these descriptions, nor depend upon this principle. This is the ownership which persons are allowed to exercise over things not made by themselves, nor made at all. Such is property in land; including in that term what is under the surface as well as what is upon it. This kind of property, if legitimate, must rest on some other justification than the right of the labourer to what he has created by his labour. The land is not of man’s creation; and for a person to appropriate to himself a mere gift of nature, not made to him in particular, but which belonged as much to all others until he took possession of it, is primâ facie an injustice to all the rest. Even if he did not obtain it by usurpation, but by just distribution; even if, at the first foundation of a settlement, the land was equitably parcelled out among all the settlers (which has sometimes been the case), there is an apparent wrong to posterity, or at least to all those subsequently born who do not inherit a share. To make such an institution just, it must be shown to be conducive btob the general interest, in which this disinherited portion of the community has its part.

The general verdict of civilised nations chasc hitherto been that this justification does exist. The private appropriation of land has been deemed to be beneficial to those who do not, as well as to those who do, obtain a share. And in what manner beneficial? Let us take particular note of this. Beneficial, because the strongest interest which the community and the human race have in the land is that it should yield the largest amount of food, and other necessary dord useful things required by the community. Now, though the land itself it not the work of human beings, its produce is; and to obtain enough of that produce somebody must exert much labour, and, in order that this labour may be supported, must expend a considerable amount of the savings of previous labour. Now we have been taught by experience that the great majority of mankind will work much harder, and make much greater pecuniary sacrifices for themselves and their immediate descendants than for the public. In order, therefore, to give the greatest encouragement to production, it has been thought right that individuals should have an exclusive property in land, so that they may have the most possible to gain by making the land as productive as they can, and may be in no danger of being hindered from doing so by the interference of eany onee else. This is the reason usually assigned for allowing fthef land to be private property, and it is the best reason that can be given.

Now, when we know the reason of a thing, we know what ought to be its limits. The limits of the reason ought to be the limits of the thing. The thing itself should stop where the reason stops. The land not having been made by the owner, nor by any one to whose rights he has succeeded, and the justification of private ownership ging land being the interest it gives to the owner in the good cultivation of the land, the rights of the owner ought not to be stretched hfartherh than this purpose requires. No rights to the land should be recognised which do not act as a motive to the person who has power over it, to make it as productive, or otherwise as useful to mankind, as possible. Anything beyond this exceeds the reason of the case, and is an injustice to the remainder of the community.

It cannot be said that landed property, as it exists in the United Kingdom, conforms to this condition. The legal rights of the landlord much exceed what is necessary to afford a motive to improvement. They do worse; they tend, in many ways, to obstruct, and do really obstruct, improvement.

For one thing, the landlord has the right, which he often exercises, of keeping the land not only unimproved, but uncultivated, in order to maintain an inordinate quantity of wild animals for what he calls sport. This right, at all events, cannot be defended as a means of promoting improvement.

Again, if the purpose in allowing private ownership of the land were to provide the strongest possible motive to its good cultivation, the ownership would be vested in the actual cultivator. But in England almost all the land of the country is cultivated by tenant-farmers, who not only are not the proprietors, but, in the majority of cases, have not even a lease, but may be dispossessed at six months’ notice. If those lands are well cultivated, it cannot be in consequence of the rights of the landlord. If those rights have any effect iat all on cultivation,i it must be to make it bad, not good. If farmers with such a tenure cultivate well, it is a proof that property in land is not necessary for good cultivation.

Butj, it will be saidj , if the mere cultivation can be, and is, satisfactorily carried on by tenants-at-will, it is not so with the great and costly improvements which have converted so much barren land into fertile. The returns to kthosek improvements are slow; and a temporary holder, even if he has the lnecessaryl capital, will not make them. They can seldom be made, and, in point of fact, seldom are made, by any one but the proprietor. And, as a certain number of landed proprietors do make such improvements, the institution of property in land is thought to be sufficiently vindicated.

Giving all the weight to this consideration which it is entitled to, the claim it gives to the landlord is not to all the possible proceeds of the land, but to such mpartsm of them only as are the result of his own improvements, or ofn improvements made by predecessors in whose place he stands. Whatever portion of them is due, not to his labour or outlay, but to the labour and outlay of other people, should belong to those other people. If the tenant has added anything to the value of the land beyond the duration of his tenancy, the landlord should be bound to purchase the improvement, whether permanent or temporary, at its full value. If the nation at large, by their successful exertions to increase the wealth of the country, have enhanced the value of the land independently of anything done by o the landlord or the tenant, that increase of value should belong to the nation. That it should do so is not only consistent with the principles on which landed property confessedly depends for its justification, but is a consequence of those very principles.

Now, the labours of the nation at large do add daily and yearly to the value of the land, whether the landlord plays the part of an improver or not. The growth of towns, the extension of manufactures, the increase of population consequent on increased employment, create a pconstantlyp increasing demand for land both for the habitations of the people and for the supply of food and qthe materials ofq clothing. They also create a constantly increasing demand for coal, iron, and all the other produce of mining industry. By this increase of demand the landed proprietors largely profit, without in any way contributing to it. The income from rural lands has a constant tendency to increase; that from building lands still more: and with this increase of their incomes the owners of the land have nothing to do except to receive it.

The Land Tenure Reform Association claim this increase for those who are its real authors.1 They do not propose to deprive the landlords of their present rents, nor of anything which they may hereafter add to those rents by their own improvements. The future Unearned Increase is what the Association rseekr to withdraw from them, and to retain for those to whose slabourss and sacrifices, from generation to generation, it will really be due. The means by which it is proposed to accomplish this is Special Taxation. Over and above the fair share of the landlords in the general taxation of the public, they may justly be required to pay hereafter a special tax, within the limits of the increase which may accrue to their tpresentt income from causes independent of themselves.

Against this proposal it is objected that many landholders have bought the lands they hold, and in buying them had in view not only their present rental, but the probability of future increase; of which increase, therefore, it would be unjust to deprive them. But the Association do not propose to deprive them of it without compensation. In the plan of the Association the landlords would have the right reserved to them of parting with their land to the State, immediately or at any future time, at the price for which they could sell it at the time when the plan is adopted. By availing themselves of this option, they would not only get back whatever they had paid for the prospect of future increase, but would obtain the full price for which they could have sold that future prospect at the time when the new system was introduced. They would be left, therefore, in a pecuniary sense, exactly as well off as they were before: while the State would gain the difference between the price of the land at the time and the higher value which, according to all probability, it would afterwards rise to. There would be no transfer of private property to the State, but only an interception by the State of an increase of property, which would otherwise accrue at a future time to private individuals without their giving any value for it; since they would have been reimbursed whatever money they had given, and would even have received the full present value of their expectations.

There is another objection commonly made, which is disposed of by the same answer. It is often said that land, and particularly land in towns, is liable to lose value as well as to gain it. Certain quarters of London cease to be fashionable; and are deserted by their opulent inhabitants; certain towns lose a portion of their trading prosperity when railway communication enables purchasers to supply themselves cheaply from elsewhere. Those cases, however, are the exception, not the rule: and when they occur, what is lost in one quarter is gained in another, and there is the general gain due to the prosperity of the country besides. If some landlords, for exceptional reasons, do not partake in the benefit, neither will they have to pay the tax. They will be exactly where they are now. If it be said that as they took the chance of a diminution they ought to have the counter-balancing chance of an increase, the answer is that the power of giving up the land at its existing price, in which both chances are allowed for, makes the matter even. Indeed, more than even. No one would benefit so much by the proposed measure as those whose land might afterwards fall in value; for they would be able to claim the former price from the State, although they could no longer obtain so much from individuals. By giving up the rise of value, they would obtain an actual State guarantee against a fall. And this would be no loss to the State; for every such fall in one quarter, unless owing to a decline of the general prosperity, implies a corresponding rise somewhere else, of which rise the State would have the benefit.

A third objection is sometimes made. Land, it is said, is not the only article of property which rises in value from the mere effect of the advance of national wealth, independently of anything done by the proprietor. Pictures by the old masters, ancient sculptures, rare curiosities of all sorts, have the same tendency. If it is not unjust to deprive the landlord of the unearned increase of the value of his land, by the same rule the increase of value of Raphaels uandu Titians might be taken from their fortunate vpossessorv and appropriated by the State.

Were this true in principle it would lead to no consequences in practice, since the revenue which could be obtained by even a very high tax on these rare and scattered possessions would not be worth consideration to a prosperous country. But it is not true, even in principle.

Objects of art, however rare or incomparable, differ from land and its contents in this essential particular, that they are products of labour. Objects of high art are products not only of labour but of sacrifice. The pains, patience, and care necessary for producing works which will be competed for by future ages, are far from being those from which the greatest immediate, and especially the greatest pecuniary, advantage is reaped by the artist. Such works almost always imply renunciation of a great part of the gains which might easily have been obtained by hasty and marketable productions; and often could not be produced at all, unless the few purchasers who are able to distinguish the immortal from the ephemeral, could feel that they might, without imprudence, pay a high price for works which would be a fortune to their descendants. The prospective rise in price of works of art is by no means an unearned increase: the best productions of genius and skill alone obtain that honour, while the increasing value of land is indiscriminate. Governments do not think it improper to disburse considerable sums in order to foster high art and encourage the taste for it among the public. Much more, then, should they not grudge to the artist what may come to him spontaneously from the estimate which good judges form of what his productions wwillw sell for long after he is dead. xWex grant that in many cases the increased value does not reach the artist himself, but is an addition, and sometimes an unlooked-for addition, to the gains of a middleman, who may have bought, at a very moderate price, works which subsequent accident or fashion suddenly ybringsy into vogue. This is a contingency to which artists, like all other workmen, are liable; if they are unable to wait they may be obliged to sell their future chances below the true value, to somebody who can. But they obtain, on the average, a higher remuneration for their labour than they could obtain if they had no such chances to sell. And it must be remembered that, along with his chances of profit, the dealer takes the risk of loss. Changes in the public taste and judgment may take place either way: if some works which may have been bought cheap acquire a high value, others for which a high price has been paid go out of fashion, gradually or even suddenly. If dealers are exposed to the one chance, they must have the benefit of the other. Were they deprived of it, their useful function, by which, until replaced by something better, artists are greatly benefited, could not be carried on.

Neither can it be said, as in the case of land, that receiving the market price of the day would compensate the holder for the chances of future increase. There is no market price of such thingsz, and the future increase has no common standard of estimationz ; it is a matter of individual judgment; and, even if an average could be struck, it would not compensate any one for the disappointment of his own expectation. The objection, therefore, from the supposed parallel case fails in its application: the cases are not really parallel.*

Other objectors say that, if it is allowable to take the unearned increase of the value of land, it must, for the same reasons, be allowable to take for the public the unearned increase of the price of railway shares. But the fallacy is here so transparent as scarcely to require pointing out. In the first place, every penny which is obtained by railway shareholders is not the gift of nature, but the earnings and recompense of human labour and thrift. In the next place, railway shares fall in price as frequently as they rise, which is far from being the case with land. If it be said that the prosperity of the country tends to increase the gains of railway shareholders as well as those of landlords, the same national prosperity leads to the creation of competing railroads, and of new and comparatively unproductive branches, so as to take away from the old shareholders with one hand nearly, if not quite, as much as it bestows on them with the other. The two cases, therefore, differ in the essential point.

We have now, we think, exhausted the objections of principle which are usually made to the detention by the State of the unearned increment of rent. It has, we think, been shown that they are all of them such as a very little consideration of the subject is sufficient to dispel. But, besides these theoretical, there are practical objections, in appearance more formidable, but, as we shall be able to show, quite as inconclusive.

It is alleged that, granting the justice of claiming the unearned increase for the State, there are no means of ascertaining what it is. It would be impossiblea, it is said,a to distinguish the increase of rent which arises from the general progress of society, from that which is owing to the skill and outlay of the proprietor: and in intercepting the former there would be perpetual danger of unjustly encroaching upon the latter.

There would be some ground for this objection in a country of peasant proprietors. The improvements made by such a class of landowners consist more in the ungrudging and assiduous application of their own labour and care, and in attention to small gains and petty savings, than in important works, or in the expenditure of money. It would really be very difficult, if not impossible, to determine how much the proprietor and his family had done in any given number of years to improve the productiveness or add to the value of the land.

But it is quite otherwise with the improvements made by rich landlords, like those who own nearly all the soil of the British Islands. What they do for the land is done by outlay of money, through the agency of skilled engineers and superintendents. It is easy to register operationsb, for instance,b of thorough drainage, and to ascertain and record, as one of the elements in the case, the cost of those operations. Their effect in adding to the value of the land has a natural measure in the increased rent which a solvent tenant would be willing to pay for it; and the whole of that increase, whether great or small, we would leave to the landlord.

The possibility of a valuation of unexhausted improvements is assumed as a matter of notoriety in all the discussions, now so common, respecting Tenant Right. It is already a custom in many parts of England to compensate an outgoing tenant for these cimprovements. Whatc is a custom in many places will soon, it is probable, be made a legal obligation in all; and among the objections made to its imposition by law, we are never told of the impossibility of doing it. But if it is possible to value the deffectd of temporary improvements, why should it be impossible to value the effect of permanent improvements? A Bill compelling a valuation of both, and giving compensation etoe both alike, has been introduced into the House of Commons by a high agricultural authority, Mr. James Howard, and has met with influential support.2

Yet if this be possible, the object is completely attained, for there is no other difficulty. The fact of an increase of rent is easily ascertained. There is nothing needed but the trouble and expense of registering the facts. It might be necessary to have a survey of the whole country, ascertaining and recording the conditions of every tenancy, and to renew this operation periodically, say every ten or twenty years. This is not so difficult as the cadastral operations of some continental countries, or the revenue surveys of British India, for these undertake to determine, by special inquiry, what rent each piece of land is capable of yielding. In the proposed survey it would suffice to record what it does yield; allowing the landlord, if he can, to prove that it is under-rented, in which case he ought not to suffer for his past moderation.

It should be understood, also, that no intention is entertained of paring down the increment of rent to the futmostf farthing. We assert in principle, the right of taking it all: in practice we have no desire to insist upon the extreme right, at any risk of going beyond it. No doubt, the option allowed to the landlord of giving up the land at its existing value, would secure him against pecuniary wrong; but we should be sorry to trade upon his reluctance to give up an ancestral possession, or one endeared to him by association. We would leave, therefore, an ample margin by way of insurance against mistakes in the ginstitutiong . We would not insist upon taking the last penny of the unearned increase. But we hmaintainh that within that limit taxation on the land, in addition to the landlord’s share of all other taxes, may justly be, and ought to be, imposed. We contend that a tax on land, not preceding but following the future increase of its value, and increasing with that increase, is a legitimate financial resource; and that it is for the individual landlord, by making an authentic record of what he does for the land, to preserve evidence that its increase of rent is the consequence and rightful reward of his own intelligent improvements.

This is the meaning of the fourth article in the programme of the Land Tenure Reform Association;3 and the reasons which have now been given are its justification. The more it is considered the more general, we believe, will be the adhesion to it of those whose regard for property is not a superstition but an intelligent conviction, and who do not consider landlords as entitled to pecuniary privilege but only to equal justice.

J.S. Mill

APPENDICES

[a]E,P most

[b-b]P in

[c-c]E hath

[d-d]E and

[e-e]E anybody

[f-f]-E

[g-g]E,P of

[h-h]E,P further

[i-i]E on cultivation at all

[j-j]P (it will be said)

[k-k]E these

[l-l]-E

[m-m]E,P part

[n]E the

[o]E either

[p-p]E consequently

[q-q]E of the materials for

[1 ]See Programme of the Land Tenure Association, Art. 4, p. 3 (CW, Vol. V, p. 690).

[r-r]E seeks

[s-s]E labour

[t-t]E personal

[u-u]E or

[v-v]E possessors

[w-w]E may

[x-x]E,P I

[y-y]E,P bring

[z-z]-E

[* ]In so far as there does exist any parallelism, its consequences should be accepted. The right of property in things which, being unique, belong, in some sense, to the whole human race, assuredly ought not to be absolute. If a half-insane millionaire took it into his head to buy up the pictures of the great masters for the purpose of destroying them, the State ought to stop his proceedings, if not to punish him for the mischief he had already done. It may hereafter be thought right to require that those who possess such treasures should either open their galleries to public view, or at least lend the contents from time to time for the purpose of exhibition; and should allow to artists, under reasonable restrictions, regular access to them for the purpose of reproduction or of study. With regard to other possessions of public interest, such as architectural remains and historical monuments generally, they ought to be, if not acquired by the State, placed under State protection. The pretence of right to destroy them, or to make any change which would impair their historical interest, ought not for a moment to be listened to. The preservation of such monuments is one of the articles in the programme of the Land Tenure Reform Association. Had it been conceded fifty years ago, many interesting relics of antiquity would have been still in existence which are now irreparably lost. [See Programme of the Land Tenure Association, Art. 10, p. 5 (CW, Vol. V, p. 695).]

[a-a]E,P (it is said)

[b-b]E,P (for instance)

[c-c]E,P improvements; what

[d-d]E effects

[e-e]E,P for

[2 ]“A Bill for the Improvement of the Relations between Landlord and Tenant,” 36 Victoria (13 Feb., 1873), PP, 1873, II, 269-84, introduced by James Howard (1821-89), Liberal M.P. for Bedford, manufacturer of agricultural implements and author of works on agriculture; it was withdrawn before its Second Reading (PD, 3rd ser., Vol. 216, cols. 1644-5).

[f-f]E uttermost

[g-g]E,P valuation

[h-h]E mention

[3 ]Programme of the Land Tenure Association, p. 3 (CW, Vol. V, p. 690).