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CHAPTER XIV

THE SQUARE DEAL

IT IS perhaps hopeless to expect any great proportion of the well-to-do to give the bulk of their surplus wealth to raise the level of life for the less prosperous. Neither patriotic nor religious appeals can counteract, for most people, the lure of the personal enjoyments, of one sort or other, made possible by money. “The money has been fairly won,” they will say; “it is ours; let these others earn their own money; the race is open to all on equal terms.”

Nor is it to be expected that any socialistic or communistic plan of equalizing wealth will commend itself to our people. We are confirmed individualists in our attitude toward the problem of distribution.

Is there then no hope for a more diffused prosperity, for a completer access for all to the good things of life? Yes, the hope lies in our American ideal of the Square Deal. Individualism in the acquisition of wealth can be retained if the race is really kept open to all on equal terms, if every citizen is given a really fair chance to acquire a competence.

The threat to our American system lies in the growing sense in the hearts of many people that they have not really had a fair chance. They had to go to work young, and could not afford an adequate education; they have not been able to live under such conditions as would safeguard their health; they have no capital with which to draw themselves up out of the status of the day-laborer, and their wages as laborers are low. On the other hand, healthful living conditions, inherited means, acquaintance with the right people, pull, leisure for proper training of the faculties, together with a measure of acquisitive ability, give their possessors a tremendous start. The race is not to all on equal terms, it is to the rich, the clever, the fortunate, those "on the inside," or those to whom some combination of lucky circumstances and mental qualities gives the necessary start.

We may waive discussion of the relative importance of these various factors. Men who have made fortunes usually attribute their success to their superior ability; while if they lose out, they attribute their failure to bad luck or to the unscrupulousness or more advantageous situation of their rivals. All these factors, and many others, enter in, so that it is difficult in any given case to know in what degree success results from superior ability; and still more obviously impossible to generalize with respect to the class of earners as a whole.

But even where it is clearly ability that wins the prize, it is apt to be an acquisitive ability rather than a productive ability. It is business strategy quite as much as productive efficiency that brings returns. The inventor who perfects some new process, the manager who evolves an efficient organization, the artisan who develops uncommon skill at his craft, are far less likely to grow rich than the owner of a plant who knows how to use the brains and industry of others for the creation of profits for himself. In fact, skill at making money seems to be in considerable degree a specialized skill, with little relation to public service or intrinsic desert.

But far more embittering than the realization of

these personal differences in environment and endowment is the growing consciousness of what is coming to be called, in a more specific sense, Privilege. This term connotes the fact that a comparatively small section of the population have succeeded in getting for themselves the greater part of the natural resources of the country and the manufacture and distribution of certain monopolizable necessities of life; this ownership and control enables them to divert to themselves an increasingly large share of the national income. Indeed, any combination of producers in a given line, whether formal or virtual, so as to create a practical monopoly, gives them just such a privileged position in our industrial system, making possible what we call today Profiteering. It is this situation, above all, which must be corrected or neutralized if we are to attain a stable and generally prosperous society.

For example, some sixty thousand people own a quarter of the land of the United States; a comparatively small number own a large proportion of the most valuable city land. As the

As the population grows, this land becomes more and more valuable. The farm-lands of the country have increased in value over two hundred per cent in twenty years. New York City real estate is increasing in assessed valuation at a rate of about a hundred and fifty million dollars a year. The annual rent received from land in New York City is said to be about four hundred million dollars. The Astor fortune, of several hundred millions, had its foundation in this rise in value of the land upon which that city is built. One farm for which one of the earlier Astors paid $4,500 is said to be worth today $50,000,000. This is an extreme case. But the general truth is that there is a con

tinual increase in land-values, and that the fortunate owners of valuable land are in a position to demand an enormous amount of money each year from the rest of the population in the form of rent.

Now we are not going to question the intrinsic justice of the private appropriation of rent. When a man has worked hard, saved his money, and put it into real estate, he is as much entitled to interest upon it in the form of rent as if he were getting interest on bonds, or on a savings-bank account. But apart from the fact that a man may inherit the land he owns, without having earned it himself-which is equally true, of course, of the other forms of Privilege—there is the other fact that the increase in the value of land is socially created. Land increases in value because the population increases. Specific lands increase more rapidly in value because good roads are built, and schools, and water-supplies and sewerage-systems, all at public expense; and because other people move into the neighborhood and build homes, and shops, and make the land in question thereby more desirable. Because of this socially created situation, many fortunate land-owners are able to get a rental considerably in excess of the average interest obtainable on the sum for which they purchased the land. They are in a strategic position. They are able to say: "You cannot use this desirable land except by paying me this high rent.” This is one aspect of what is today commonly called Privilege.

What is true of land is true of all the natural resources of the country—the ore deposits, the coal, the oil, the natural gas, the forests. A comparatively small class of people have been fortunate or clever enough to get the ownership of practically all of the sources of supply of these indispensable things. The great mass of poor people couldn't buy them up; a few rich people could. And now these people are in a situation to ask, and get, high prices for iron and copper and coal and oil and gas and lumber. In certain cases, owners of some of these natural resources have received profits of a thousand per cent in a year on their investments. Coal we must have, or freeze to death; lumber we must have for buildings and for furniture, as well as wood-pulp for paper. Copper and iron are essentials in an industrial age. And in almost equal degree a long list of important commodities. But because we must all of us have these things, is it right that we should have to pay for them whatever the owners of the sources of supply demand?

Any one of a number of other factors may likewise give a privileged position, an inside track, in the race for fortune. It may be a franchise that gives its possessor exclusive right to supply a community with electricity, or gas, or street-car service, or to develop and sell water-power from a given site. It may be the possession of trade-secrets or patents. It may be the ownership of a railroad, or of refrigerator cars, or of storage-warehouses. It may be a tariff law which chokes off foreign competition and enables a manufacturer to demand a higher price than he could get in an open market. It may be a sudden increase of demand for certain commodities, or a sudden decrease in the available supply-as happened so strik

ingly during the Great War. But whatever the cause, or combination of causes, that makes possible the high profits, there are few human beings who will refuse the opportunity. In their own minds these fortunate

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