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Driven away from London and from South Africa, will capital and labour turn to Canada ? Even there land monopoly meets them. Lord Strathcona, speaking as chairman of the Hudson Bay Company on the 6th of July 1908, said : 'The falling off in the land sales need cause no alarm. It was partly due to the financial stringency and partly to the company's restrictive policy, which was not to press sales, but to hold for better prices. Since 1903 the average price per acre had risen from 11. 38. 3d. to 21. 11s. 9d.'

In these instances we have two private land companies and a private individual exercising their monopoly, their power of beating off capital and labour from co-operation with their indispensable partner in the production of wealth. Even if it were true that capital and labour could get other land, as Mr. Cox says, there is no reason

hy should be buffeted about the world by the blind, suicidal power of monopoly. All individuals, all towns and cities, all countries and all empires live and prosper by industry; and yet we are asked to give our first consideration in our political arrangements to monopoly, its relentless and mortal enemy. There is no reason why the capitalist should be driven from the most desirable opportunity for investment of his capital to a less desirable, nor from the less desirable to the least desirable, nor from the least desirable out of an investment altogether or into one that is unsound.

Mr. Cox denounces the land taxers for their presumption in reciting a 'cock-and-bull story' about the Land Tax of 1692, 'a demonstrably untrue story, which makes it difficult for him to understand their moral attitude. If there are wicked people who find a precedent where there is none, or who push a precedent too far, they may be left to defend themselves. There is abundant reason, however, for taking exception to Mr. Cox's account of the subject. It may be assumed at once that no intelligent reformer finds his ideal in past conditions ; that no land taxer claims that the British people of the seventeenth century were so much alive as the British people of to-day to the importance of observing clear distinctions in our systems of rating and taxation. The tax imposed under the Act of 1692 was not a tax on a land value basis as we understand it to-day. It was a tax on the land value, on the value of improvements, on personal property and incomes derived from some public offices. The main provision of the Act, from which it took its title, was a tax on land, 'according to the full annual value thereof, without any respect had to the present rents reserved for the same,' and the tax was to be after the rate of four shillings for every twenty shillings of the full yearly value as the same were let for, or worth to be let, at the time of assessing thereof.' The assessments under the Act, however, soon ceased to move in relation to the movement in the value of the subjects, and in 1798 the valuation, which had remained practically the same for a century, was made perpetual, and permission

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was granted to redeem the tax. But while land was receiving the attention of the tax collector only under this stereotyped valuation, he was breaking ground with a vengeance in other directions. His raids on other forms of property became annual campaigns. He taxed everything that was taxable: houses, windows, wool, carriages, dogs, horses, food of every variety, and incomes from every source. If the principles of taxation embodied in that Act had been developed in the proportions or measures which they held in it, the value of the land would be now directly contributing a great part of our national revenue. By way of comparison, would not the Civil servants gladly pay income tax on the incomes which their predecessors had in 1692 ? Would not the present generation willingly pay on the value of the personal property possessed by that generation ? And why did none of our fathers redeem, for ever and ever, their taxes and ours on incomes, food, and houses ? The history of taxation in this country during recent centuries is largely a record of the landowners' anxious and successful efforts to take and keep land as far as possible out of the standard of rating and taxation. These efforts may be justifiable, if we consider the views which they hold with regard to their interests. The last instance of this policy was the Agricultural Rates Act of 1896, which was opposed and denounced by the Liberal party as a measure passed in the interest of the landowners at the expense of the urban ratepayers.

Mr. Cox does not meet the argument about the obligations attached to landholding in feudal times. He is impatient with it. The landowners bore the greater part of the public burdens in those days:

The only puzzle (says Mr. Cox) is to know why any pamphleteer or speaker should take the trouble to make such an obvious remark. In former centuries land was almost the only source of wealth, and therefore naturally provided a larger share of the public revenue than now when other sources of wealth are, collectively at least, twenty times as important as land.

Does he really mean that new sources of wealth have been discovered with the great increase of capital during recent centuries, that the cotton or woollen goods which come out of the mills in Lancashire and Yorkshire have their origin and growth somewhere in the spinning and weaving machines which cost so many millions to build ? Or if simple-minded people remark that the wool is discharged from ships in London docks and the cotton from ships in Liverpool docks, will he tell them that the wool and cotton are generated by some very costly machinery like refrigerators in the holds of the ships ? Some people, ignorant of the existence of these new sources of wealth, still believe that the mighty wool and cotton spinners of Yorkshire and Lancashire require to get their wool and cotton from the one and only source from which Penelope and Eve, two of their oldest reputed

predecessors, secured them. Land has not become so unimportant as Mr. Cox suggests.

Many of his arguments on other points are marked by the same wild daring. He attacks what he calls another very plausible and superficial allegation of the land taxers. The contention of the latter is that landowners do not bear their fair share of the local and national burdens. Mr. Cox's reply is to the effect that the landowners really bear all the public burdens, because they let their land at rents lower on an average by the amount of the present and prospective rates and taxes which the tenant agrees to pay. It is difficult to characterise this argument. It can hardly be called plausible, and its subtle audacity is exquisitely fitted to stun and bewilder the ordinary man. The land taxers argue that the man who is privileged to hold land which is rendered valuable by the performance of public or common services should be called upon to pay an amount equal or corresponding to that value towards the maintenance of those services. If, after the payment of all rates and taxes by the lessees, a landowner still draws 20,0001. a year from land on which he has laid out no capital and bestowed no labour, it is fair to assume that the production of the wealth represented by this sum has been a burden and charge on some one, and that the landowner who receives this sum should have a special and peculiar share in bearing this burden. Of course, if the landowner paid 50001. in rates, he might get 26,0001. in rent, but the position would be unaltered; he would still receive a large income in respect of which he rendered no service. This income is earned by public capital and public labour. It may be that 'the main object of the freeholder,' as Mr. Cox says, 'is generally to create a fixed annuity which he can sell as a trust investment,' and that for this purpose it is imperative that the ground rent should be relieved of the uncertainty attaching to local rates,' but this does not settle the question of fairness or equity ; it only raises it.

There are some inconsistencies and some obvious fallacies in Mr. Cox's argument about the holding up of land. First of all, he is inclined to believe that the holding back involves no injury at all,

except possibly to the landowner himself.' He thinks 'the holding back of urban sites, where it occurs, tends to drive the population more into the country.' He omits to tell us where they are driven by the holding back of rural sites. Again, he argues, or asserts, that the effect of a universal tax would be partial, that the tendency would be for owners of small areas to let go, and for owners of large estates to add to the area which they held idle. This means that a ten per cent. tax on land values, an ad valorem tax which, as an absolute charge or burden, would fall most heavily on the large owners, would affect them least, or even incline them to incur the greatest loss. The large owners, Mr. Cox says, will lose ten per cent. of the capital with indifference. Will they also contemplate the risk of losing twenty or

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thirty per cent. without perturbation? It seems rather strange that the small men will transfer the losing concern to the keenest and shrewdest financiers, and thus concentrate the land of the country in the hands of wealthy speculators. After insinuating that agricultural land would be put under game, he perpetrates the old, notorious fallacy as nearly as possible in the old familiar form of words : ‘Is it one of the objects of the land taxers to drive the farmers and labourers off the land in order to make room for game preserves ?' We need hardly remind Mr. Cox of the question : "Have you left off beating your wife?' While the speculators are going to be unmoved by the tax on vacant land, cricket and football clubs are taking action to secure the exemption of their property from any land values tax which may be imposed. They are wise in their generation.' But why should cricket clubs be moved, if men with a thousand times more land are unaffected ? Surely Mr. Cox cannot expect plain people to believe that his two contradictory statements are both sound.

With regard to the political steps by which it has been sought to realise the object of this proposal, they have been consistent and free from vindictiveness in a remarkable degree. The Bill for Scotland and the Bill for England and Wales promoted by the great municipalities provided for the valuation and rating of land. Opponents and timid or cautious friends might object that it was going too fast to value and rate land values in one measure. The Select Committee took that view, and recommended that a Bill to provide for valuation only should be prepared and passed. This was done. In 1907 the Valuation Bill for Scotland was introduced. Having regard to criticisms that were offered, the Lord Advocate postponed the date of its coming into operation till 1910. It was rejected by the Lords on second reading. Reintroduced in 1908, it was amended so as to make its operation depend on its adoption by local councils. This amendment was rightly considered fatal by the Government, as it would render the whole valuation system of the country chaotic. In all this there was nothing hasty, nothing ill-considered. It was a policy of taking only one step at a time and of leaving a considerable interval between each step. But this careful policy was not acceptable to the Lords, and so the Government is thrown back on the more direct method of carrying out the proposal by means of the Budget. So long as they have this resource, it would betray weakness and inconsistency on their part to ignore the claims which this reform has on them and to abandon the effort to give it legislative effect by the most immediate means. The fact that the Lords have conceded every point of principle should encourage them to do this, as it could only be for reasons connected with party politics that the Lords should thus give their assent and then render the principle inoperative by an amendment.

JOHN ORR.

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1909

QUO VADIS ?

A PROSPECT IN INDIAN POLITICS

*I am under the strong opinion that as government in India becomes more and more Parliamentary-as well may be the result-so it will become less paternal and less beneficent to the poorer classes of the population.'—Lord Curzon, House of Lords, 23rd of February 1909.

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REFORMS in the Indian Constitution were bound to come. There are limits to inconsistency, and it is really impossible to avoid giving the people of India opportunities for practising the principles which we have been teaching in schools and colleges for the last half-century. It is disconcerting that the changes should have been hailed by the National party as exceeding the highest expectation-all the more so as there is an impression that they have been rather extorted than granted, and that they owe to apprehensions of violence their growth from the very modest scheme outlined by the Secretary of State two years ago. It must be admitted that the occasion is unfortunate for the relaxation of official control, for in India dignity counts for a great deal, and a Government which is suspected of weakness cannot afford to be generous or even just. But sooner or later reforms were inevitable. It may be objected that the cry for representative government-for a popular Constitution-expresses no real desire in the East, that it is simply a manifestation of the impatience with which all mankind regards an alien rule, and that it is not heard in the extensive territories which are governed, more or less despotically, by Native rulers. But for long past we have definitely committed ourselves to the idea that self-government is an ideal, and that, exotic though it be, it can be cultivated in India. Two generations of Indians have been taught the literature, history, and philosophy of England, the dominant note of which is political freedom. The first generation regarded these lessons as Utopian exercises for the intelligence and in the use of words ; the second generation has come to look deeper and to assimilate its teaching in matter as well as in form. Nor have we confined to the lecture-room our appreciation of English political methods : we have given demonstrations of them in the marketplace. The measures of local self-government which were introduced a quarter of a century ago provided for the management of local

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