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CHAPTER LXVI CONFISCATION OR COMPENSATION

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(shall the workers buy out the capitalists? can they afford to do it, and what will be the price?)

the problem of whether the social revolution shall be violent or peaceable depends in great part upon our answer to the question of confiscation versus compensation. we are now going to consider, first, the abstract rights and wrongs of the question, and, second, the practical aspects of it.

there is a story very popular among single taxers and other advocates of freedom of the land. an english land-owner met a stranger walking on his estate, and rebuked him for trespassing. said the stranger, "you own this land?" said the other, "i do." "and how did you get it?" "i inherited it from my father." "and how did your father get it?" "he inherited it from his father." so on for half a dozen more ancestors, until at last the englishman answered, "he fought for it." whereupon the stranger took off his coat and rolled up his sleeves and said, "i'll fight you for it."

this is all there is to say on the subject of the abstract rights of land titles. there is no title to land which is valid on a historical basis. everything rests upon fraud and force, continued through endless ages of human history. we in the united states took most of our land from the indians, and in the process our guiding rule was that the only good injun was a dead injun. we first helped the english kings to take large sections of our country from the french and spanish, and then we took them from the english king by a violent revolution. we purchased our southwestern states from mexico, but not until we had taken the precaution of killing some thousands of mexicans in war, which had the effect of keeping down the purchase price. it would be a simple matter to show that all public franchises are similarly tainted with fraud. proudhon laid down the principle that "property is theft," and from this principle it is an obvious conclusion that society has the right to scrap all paper titles to wealth, and to start the world's industries over again on the basis of share and share alike.

but stop and consider for a moment. "property is theft," you say. but go to your corner grocery, and tell the grocer that you deny his title to the sack of prunes which he exhibits in front of his counter. he will tell you that he has paid for them; but you answer that the prunes were raised on stolen land, and shipped to him over a railroad whose franchise was obtained by bribery. will that convince the grocer? it will not. neither will it convince the policeman or the judge, nor will it convince the voters of the country. most people have a deeply rooted conviction that there are rights to property now definitely established and made valid by law. if you have paid taxes on land for a certain period, the land "belongs" to you; and i am sure you might agitate from now to kingdom come without persuading the american people that new mexico ought to be returned to mexico, or the western prairies to the indian tribes.

such are the facts; now let us apply them to the right of exploitation, embodied in the ownership of a certain number of bonds or shares of stock in the united states steel corporation. "pass a law," says the socialist, "providing for the taking over of united states steel by the government." at once to every owner comes one single thought—are you going to buy this stock, or are you going to confiscate it? if you attempt confiscation, the courts will declare the law unconstitutional; and you either have to defy the courts, which is revolutionary action, or to amend the constitution. if you adopt the latter course, you have before you a long period of agitation; you have to carry both houses of congress by a two-thirds majority, and the legislatures of three-fourths of the states. you have to do this in the face of the most bitter and infuriated opposition of those who are defending what they regard as their rights. you have to meet the arguments of the entire capitalist press of the country, and you have the certainty of widespread bribery of your elected officials.

the prospect of doing all this under the forms of law seems extremely discouraging; so come the syndicalists, saying, "let us seize the factories, and stop the exploitation at the point of production." so come the communists, saying, "let us overthrow capitalist government, and break the net of bourgeois legality, and establish a dictatorship of the proletariat, which will put an end to privilege and class domination all at once." what are we to say to these different programs?

suppose we buy out the stockholders of united states steel, and issue to them government bonds, what have we accomplished? nothing, say the advocates of confiscation; we have changed the form of exploitation, but the substance of it remains the same. the stockholders get their money from the united states government, instead of from the united states steel corporation; but they get their money just the same—the product, not of their labor, but of the labor of the steel workers. suppose we carried out the same procedure all along the line; suppose the government took over all industries, and paid for their securities with government bonds. then we should have capitalism administered by a capitalist government, instead of by our present masters of industry; we should have a state capitalism, instead of a private capitalism; we should have the government buying and selling products, and exploiting labor, and paying over the profits to an hereditary privileged class. the capitalist system would go on just the same, except that labor would have one all-powerful tyrant, instead of many lesser tyrants, as at present.

so argue the advocates of confiscation. and the advocates of purchase reply that in buying the securities of united states steel, we should fix the purchase price at the present market value of the property, and that price, once fixed, would be permanent; all future unearned increment of the steel industry would belong to the government instead of to private owners. consider, for example, what happened during the world war. when i was a boy, soon after the steel trust was launched, its stock was down to something like six dollars, and i knew small investors who lost every dollar they had put in. but during the war, steel stock soared to a hundred and thirty-six dollars per share; it paid dividends of some thirty per cent per year, and accumulated enormous surpluses besides.

the same thing was true of practically all the big corporations. according to secretary of the treasury mcadoo, there were coal companies which paid as high as eight hundred per cent per year; that is to say, the profits in one year were eight times the total investment. assuming that our government bonds paid five per cent, it appears that the owners of these coal companies got one hundred and sixty times as much under our present private property system as they would have got under a system of state purchase. even completely dominated by capitalism as our courts are today, they would not dare require us to pay for industries more than six per cent on the market value of the investment; and from what i know of the inside graft of american big business that would be restricting the private owners to less than one-fourth of what they are getting at present.

we have already pointed out the economies that can be made by putting industry under a uniform system. but all these, important as they are, amount to little in comparison with the one great consideration, which is that by purchasing large scale industry, we should break the "iron ring"; we should thenceforth be able to do our manufacturing for use instead of for profit, and so we should put an end to unemployment. our cheerful workers would throng into the factories, to produce for themselves instead of for masters; and in one year of that we should so change the face of our country that a return to the system of private ownership would be unthinkable. in one year we could raise production to such a point that the interest on the bonds we had issued would be like the crumbs left over from a feast.

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