Page:Popular Science Monthly Volume 16.djvu/762

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the joint share of the other two is determined. In current economic doctrine there is no correlation between the laws determining the shares of these factors, and the nomenclature does not clearly or correctly express the shares into which wealth is divided. It is common for economists to speak of the division into rent, wages, and profits.

Rent clearly expresses the return made to landholders for the use of the land, and wages the return made for exertion of whatever kind; but profits does not express the return made for the use of capital. It includes, as well, that return made for labor in guiding and directing a business, commonly spoken of as the "wages of superintendence," and also the return for risk of capital. Wages of superintendence properly belong under wages, and, considering the entire field of industry, risk is eliminated. There is then left interest, which expresses all and no more that is properly the return made for the use of capital. The division of the produce is, therefore, into rent, wages, and interest. The laws of each of these will be found to correlate, and this interdependence is presumptive of their truth.

What, then, is the law of wages? In a primitive state of society, or in any of those simple occupations where a man works for himself, without calling in the use of capital, the whole result of his labor constitutes his return—his wages. The man who picks berries, hunts, or fishes, evidently has the berries picked, the game obtained, and the fish caught as the reward of his exertion. The wages of any number of laborers would be the whole amount produced, and the share of each would be proportional to the amount his labor contributed to the general stock of produce. But labor can not proceed very far before tools become necessary. Instead of all the labor being devoted to the things that are desired for consumption, part of the labor must be devoted to making tools that will facilitate the production of the things desired. These tools are capital, and the whole produce now obtained by the joint action of labor and capital will not go to labor alone, but will be divided between the two. Mr. George holds that interest is due simply to the value that the vital or reproductive forces of nature give to the element of time, the return for capital in any form being averaged with the return to capital in those forms in which these forces come into play. The constant tendency is to an equation between interest and wages, so that the return to capital and labor will be the same for the same work done. Labor and capital, therefore, would divide up between them the entire produce resulting from their union, each having a share proportionate to its contribution to the whole. But they are not permitted to make such division. A third party claims a share—the landholder.

If one man owned all the land that was open to capital and labor, he would have absolute control over the produce of these agents. He could take, if his authority were respected, any part of it, or all of it, as he was inclined. In actual industrial society, however, land is in