Chapter 53 Chapter Ten Land Lease

Section 1 The early form of tenancy was generally established on the basis of partnership, and the conditions of partnership were determined by custom rather than by contract; the so-called landlord was generally an anonymous partner. In ancient times, and even in some backward countries of our time, all property rights depended on conventions, not on express laws.If such a convention can be given a definite name and expressed in modern commercial terms, it generally means that the ownership of the land does not belong to individuals, but to a partnership, one or a group of partners is an anonymous partner, and the other One or another group of partners (perhaps a family) are the managing partners.

The dormant partner is sometimes the sovereign, sometimes a private individual with the right to expropriate the sovereign's land; but, in the course of time, it insensibly becomes a more or less certain and absolute landowner's right.If he is still obliged to pay tribute to the sovereign, as is generally the case, the partnership consists of three partners, two of whom are hidden partners. The dormant partner, or one of the dormant partners, is commonly called the proprietor, landholder, landowner, or even landowner.But this is a false statement, as he is bound by law or custom (which has the same force as law), and cannot deprive him of the land by any arbitrary increase of the remuneration paid by the tiller, or by other means.In this case the title to the land does not accrue to him alone, but to the partnership as a whole, in which he is no more than a hidden partner.

The remuneration paid by the partner is not rent at all, but a fixed amount or a part of the total income stipulated by the organization regulations of the partnership enterprise.If the law or custom which regulates such remuneration is immutable, the theory of ground-rent will have little room for immediate application. Section II But as modern British history proves, habit is more flexible than it appears.Caution must be exercised in applying Ricardo's analysis to modern English land problems and early tenancy.The terms of partnership are ambiguous, flexible, and in many ways can be modified unconsciously.

But in fact, the various lessons stipulated by custom are often of an uncertain nature; and the records handed down are often vague, inaccurate, or at best expressed in an unscientific phrase. Even in modern England we can detect the influence of this ambiguity in the contracts made between landlords and tenants.For such contracts are often interpreted by means of custom, which has been changing to suit the different needs of successive generations.We change our habits much more quickly than our predecessors did, and are more conscious of this change, and more willing to fix them into laws, so that they may be consistent.

Now, notwithstanding the great detail of the legislation, and the conscientiousness of the contracts entered into, there is great flexibility in the amount of capital invested by the landlord in the maintenance and extension of farm buildings and other improvements.In this respect, as in the direct monetary relations between him and his tenants, the landlord appears generous; and of particular importance to the general argument of this chapter is the adjustment of the costs of running the farm shared by the landlord and his tenants, as in the monetary rent. As with any change, it can often cause a change in the real pure rent paid by the tenant.Some societies, and many great landowners, for example, have tended to keep their tenants in business from year to year, without ever attempting to make money rents vary with the real rentable value of the land.There are many non-lease farms whose rents remained nominally constant during the inflation of agricultural prices in 1874 and the subsequent depression.But, in the early days, the farmer, knowing that his rent was too low to force the landlord to pay for drains or new farm buildings, or even repairs, had to make accommodations to him in planning and other respects.Now that the landlord has fixed tenants, in order to protect the tenants, he is willing to do many things that are not stipulated in the contract.Money rent, therefore, has not changed, but real rent has changed.

This fact is an important illustration of the general proposition that the economic theory of rent, sometimes called the Ricardian theory, is inapplicable to land tenancy in England without numerous modifications and limitations in form and content. ; a further extension of these amendments and limitations would make it applicable to all tenancy under any private property in the Middle Ages and in the countries of the East, the difference being only of degree. The third section continues. However, the difference in this degree is very large.This is partly because, in primitive times and backward countries, the power of custom is often indisputable; and partly because, in the absence of scientific historical conditions, the short-lived man cannot be sure whether habit is secretly changing or not. , just as a dying insect cannot perceive the growth of the vegetation it inhabits.But the main reason is that the terms of partnership are not set precisely and are often difficult to measure.

Because the share obtained by the high-status partners (or landlords for short) in a partnership enterprise generally includes the right to levy certain services, taxes, toll taxes and gifts (whether they have the right to share a certain part of the product); and here The amount he got under several items is different from that time to that time, from one place to another, and from one landlord to another.If the farmer, having fulfilled all his burdens, has a surplus beyond the means of subsistence necessary for himself and his family, and the comforts and luxuries prescribed by custom, the landlord is bound to use his power to increase the income of one form or another. burden.If the main burden is to pay a certain amount of produce, he will increase that amount.But since this is impossible without violence, he prefers to increase the variety and quantity of various small taxes, or to insist that the land must be carefully cultivated, and that most of the fields must be planted with labor-intensive and therefore of great value crops. .In this way, the changes proceed like the hands of a clock, generally as surely, calmly, and almost imperceptibly; but over a long period of time the evolution is quite thorough.

Even with respect to these burdens the protection which custom affords the tenant is by no means unimportant.Because he always knows exactly what needs should be met when.All moral notions, high and low, around him objected to the sudden and massive increase by the landlord of those burdens, levies, taxes, and fines which are generally regarded as customary; But, it is true, these uncertain variables generally represent but a small part of the total rent; and in those not very rare cases, in which the money rent has been fixed for long A part of the remaining profit of the land is due, on the one hand, to the indulgence of the landlords when the net value of the land rises, and, on the other hand, to the support of custom and the force of public opinion.This force is to some extent similar to that which supports the raindrops on the lower part of the window frame. Before the window vibrates violently, they are at ease, but once vibrated, they fall at the same time.Likewise, the legal rights of landlords, long hidden, sometimes come into play suddenly during periods of great economic change.

Section 4. Benefits of shareholding and small landholding. As far as England and India are concerned, the question whether the consideration paid by the tenant for the use of the land should be calculated in money or in kind is very interesting.But now we may leave it alone and discuss the fundamental difference between the "British" rent system and the so-called "sharing system" in the United States and the so-called "sharing system" in Europe. In the countries of the greater part of the Latin nations of Europe, the land is divided into tenements, which the tenant cultivates with his own and his family's labor, sometimes (though rarely) with the assistance of a few hired hands.The landlord provided houses, cattle, and sometimes even farm tools.In the United States, all kinds of tenancy systems are rare, but two-thirds of the only leased land are small plots, leased to the poorer class of whites, or freed black slaves, according to In this system, labor and capital share the product.

This system enables a man who has no capital himself to use it at a lower cost than under any other conditions, and at the same time with more freedom and a greater sense of responsibility than if he were a hired laborer; The system has many advantages of the three existing systems of cooperative system, dividend system and piece wage system.However, although the profiteer has more freedom than the hired laborer, he has less freedom than the English peasant. His landlord, or his agent, must expend much time and energy in supervising his work; therefore, he must charge a large fee, which, though it is called by another name, is actually a management fee. .For when the tenant must hand over to his landlord half the return of his capital and labor each time he invests in the land, it would be to his disadvantage if the total return from the investment was less than twice what was his remuneration, he decided Do not engage in such investments.If he is allowed to cultivate freely, the degree of intensification of his cultivation is far lower than that under the British system.His capital and labor are limited so far as to give him more than double his return, and his landlord, therefore, receives a smaller share of that return than under a system of fixed returns.

This is the system adopted in many countries of Europe, under which the tenant has a de facto fixed tenure; thus, only by constant intervention can the landlord keep the tenant a certain amount of labor on his farm and prevent him from Using cattle to do work other than field work, the remuneration for this kind of work belongs to the tenant, and the landlord has no right to intervene. But even in the least varied areas, the quantity and quality of farm implements customarily prescribed by the landlords are always changing imperceptibly to meet the changing relations of supply and demand.If the tenant has no fixed tenancy rights, the landlord can arbitrarily arrange the amount of labor and capital provided by the tenant, and the amount of capital provided by himself, so as to meet the needs of various special occasions. Clearly, there are many advantages to share farming, if the tenure is small, the tenants are poor, and the landlord is troubled by many trivial matters.But it does not lend itself to tenements large enough to exploit the entrepreneurial spirit of a talented and responsible tenant.This is usually associated with small landholdings; we discuss them in the next section. The fifth section continues. The position of the small landowner is very attractive.He can do as he pleases, without interference from the landlord, and without fear that the fruits of his labors will be obtained by others.Land ownership gave him self-respect, a steadfast character, and made him a thrifty householder.He had little idle time, and seldom regarded his work as drudgery; All this for the land he loves. Younger said, "Property is like magic, it can turn sand into gold".This is undoubtedly true on many occasions where the small landowner has special powers.But these men might have achieved as much, or more, if they had not confine their horizons to the narrow confines of being small landowners.For there is indeed another side to this matter; and it is often said, "The land is the laborer's best savings bank." Sometimes it takes a secondary place among the best, and the primary place is the ability of him and his children. .Small landowners are so devoted to their land that they often do nothing else.Even many of the wealthiest among them save money and save food and money.They often boast of the splendor of their houses and furniture; but they live in kitchens for economy, and are in fact far less well off than the better-off classes of English farmers.The poorest of them work long hours and with great toil, but they accomplish little, for they eat worse than the poorest workmen in England.They do not know that the utility of wealth is only a means to true happiness; and they sacrifice the end for the means. It must never be forgotten that British labor represents the failure of the British system, not its success.They are the descendants of those who, for generations, did not take advantage of the opportunities which gave their able and adventurous neighbors prosperity at home, and, what is more important, lands abroad.The English nation became masters of the New World for many reasons, the most important of which was the enterprise which once made a man rich enough to be a small landowner not generally content with the monotony and income of a peasant life. meager.There are many reasons which encourage this enterprise, the most important of which is to be immune to the temptation to wait for a small inheritance, and to marry for property rather than through free love.This temptation often limits the capacity development of youth in places where small landholdings predominate. Partly because of this lack of temptation, American "farmers," though a working class who worked their land with their own hands, were not the same as "small landowners."They spend their income well and wisely in developing their own and their children's abilities.And this power constitutes the chief part of their capital, since their lands are of but a very small value.Their minds are often sharp, and although many of them lack agricultural technical knowledge, their sharpness and flexibility make it possible for them to be good at solving the problems they face without fail. Generally speaking, the problem is that the produce produced in agriculture is more in relation to the labor expended, though less in relation to the great quantity of land they possess.In some parts of the United States, however, where the land is beginning to acquire a scarce value, and where near favorable markets it becomes increasingly profitable to intensify cultivation, the methods of cultivation and tenancy are being changed in the manner of England.In recent years, Americans have tended to hand over the farms in the West to the new European immigrants, just as they handed over the farms in the East and the textile industry a long time ago. Section 6. The English system makes it possible for the landlord to furnish that part of the capital at his disposal and for which he is responsible.It affords great freedom of choice, though less than in other branches of industry. Let us return to the tenancy system in England.This system is defective in many respects, and harsh as well.But it stimulates and saves enterprise and energy. This kind of enterprise and energy, supplemented by Britain's geographical advantages and not being affected by destructive wars, have enabled Britain to excel in processing industries, colonial undertakings and Agriculture (albeit to a lesser extent) became number one in the world.Britain has learned some experience in agriculture from many countries, especially the Netherlands.But on the whole she taught far more than she learned.Now, apart from the Netherlands, no country in the world can compare with her in terms of the yield per mu of fertile land.Nor is there any country in Europe where such a high remuneration is obtained in relation to the labor expended. The chief advantage of this system is that it makes it possible for the landlord to be responsible for that part, and only that part, of his property, which administration will cost him neither much labor nor inconvenience to his tenant.Its investments, while requiring enterprise and judgment, do not require constant oversight of the details.His part consists of land, buildings, and permanent improvements, which in England are on the average five times the capital which a farmer is obliged to provide for himself.He is willing to use such a large amount of capital as his own shares in the business, and the pure ground rent he earns rarely reaches the capital rate of 3%.There is no other enterprise in which a man can borrow the capital he needs at so low a rate, or so much at any rate.It is true that the farmers borrowed even more capital than this, but the interest paid was much higher. A second advantage of the English system, which arose partly from the first, was that it gave the landlord great liberty in choosing competent and responsible tenants.As far as land management, which is different from land ownership, is concerned, British origin is far less important than other European countries.But we already know that, even in modern England, parentage is very important in obtaining leading positions in various businesses and in freelance or even craft trades, and even more so in English agriculture.Because the combination of strengths and weaknesses of the landlords prevents them from selecting tenants on strict commercial principles, and they do not change tenants very often. The seventh section continues. The number of people who have the opportunity to push agricultural technology one step further is numerous.As the branches of agriculture are far less differentiated in general character than industry, a new method is quickly adopted by all branches, and is generally disseminated.But, on the contrary, progress has been slower.Because most enterprising farmers migrate to the cities, while those who stay in the countryside live a somewhat lonely life; due to the relationship between natural selection and education, their minds are often not as active as those in the cities, and they are often unwilling to advocate or even Take a new approach.Moreover, while the firm is nearly infallible in adopting the same methods that work well for him in his trade, the farmer is not.Since each farm is more or less its own idiosyncrasies, the blind adoption of the methods which have worked around them is bound to fail; Secondly, various details in agriculture are very complicated, making accurate agricultural accounting difficult.There are many associated products and many by-products, and the relations of debits and credits between the various crops and methods of husbandry are so complex and changing that the average farmer would love accounting as much as he actually hates it. , unless guessing is used, it is difficult to determine what price is worth it to increase a certain amount of additional output.He can know its direct cost with considerable precision, but he knows very little of its true total cost, which increases the difficulty of drawing lessons from experience in time to make progress with it. Also, agriculture and industry differ in the way they compete.If a manufacturer's ability is weak, others can replace it.But if the landlord is unable to develop the resources of his land in the best manner, no one else can make up for this defect except by bringing about a tendency towards diminishing returns; his want of intelligence and enterprise, therefore, makes the marginal The supply price is higher.But the difference between industry and agriculture in this respect is really only a difference of degree; for the development of any branch of industry is hindered by the lack of ability and enterprise of the major factories engaged in it.The principal improvements in agriculture have been made by landowners, who are themselves townspeople, or at least closely connected with them, and have also been made by manufacturers in the trades auxiliary to agriculture. Section VIII Large land tenure system and small land tenure system.cooperate. Though the remuneration which nature furnishes increases with the quantity of labor of a given efficiency, it does not increase in proportion to the quantity of labour; Law of increasing returns (that is, overall efficiency increases in proportion to the increase in the number of workers).However, the economics of mass production in the two cases are quite different. In the first place, agriculture must occupy a large area, the raw material can be transported to the manufacturer for use, and the farmer must find work for himself.Secondly, agricultural laborers must work according to seasons, and it is difficult to specialize in one kind of work throughout the year.Agriculture, therefore, even under the English system, could not advance rapidly in the direction of industrial methods of production. However, various huge forces tend to make it develop in that direction.The progress of invention is constantly increasing the quantity of machines which are very useful and expensive, so to speak, because most of them can only be used for a short time by the small farmer.He can hire some machinery, but many can only be used by him in cooperation with his neighbors.The impermanence of the weather often prevented him from successfully realizing this plan in practice. Thirdly, the farmer, in order to adapt to the changing needs of the times, must escape the results of his and his father's experience.He must grasp the developments in agricultural science and practice sufficiently to improve his farm.To do all this properly, organic change is necessary.A farmer of this ability will find time to determine the general policy of management of a few hundred or even a few thousand acres.And it's a job that doesn't suit him to be in charge of the details of work.The work he should be doing is no less difficult than that of a great manufacturer, which will not waste his energies in petty supervision which he can easily do with his employees. A farmer capable of such superior work, unless he employs many teams with overseers in charge of each, will waste his energies in a work which is not worth his while.However, there are not many farms that can develop this talent, so the temptation to put someone who is really able into agribusiness is not great.The most capable men in the country generally shun agriculture and engage in trade and industry, where men with first-rate abilities have the opportunity to do only high-level work and do nothing else, and do a lot of high-level work, and thus acquire high management positions. amount of remuneration. If it is assumed, as is the modern way, that the farmer does not often work with his hired hands, nor encourages them by his presence on the spot, it seems best for the economy of production that the farm should As far as the conditions of the tenancy permit, there is opportunity for the use of extremely specialized machinery, and for the exercise of the talents of the farmer.But if the farm is not very large, and if, as is generally the case, the ability and intelligence of the farmer is not higher than that of a good foreman in industry, it may perhaps be best, for the benefit of others and finally for himself, to continue in the old way, and to work with him. employees working together.His wife may also take part in some light work in and out of the village, which she is customary to do.What they require is prudence and judgment, and they are not incompatible with education and culture.Combined with these, they not only do not degrade, but enhance her interests in life and his social status.There is reason to think that the harsh workings of the principle of natural selection are now weeding out those farmers who are neither qualified for the difficult mental tasks nor willing to perform the physical ones.Their place is being taken by men of above-average natural ability, who, aided by modern education, are gradually falling out of the ranks of the laborers; With new life and spirit, for they work with their hired hands instead of telling them to work.Now that the gigantic farms are gone, the immediate future of English agriculture seems to lie in small farms run on the above principles.Small plots have great advantages, provided that the crops there must be carefully guarded beyond the power of machinery.But the application of modern scientific methods has made the economics of expertise increasingly important, as seen in nurseries employing a few well-paid assistants to grow precious flowers and fruits. The ninth section continues. Secondly, what we want to discuss is how the landlords planned the size of the tenure land for their own interests to meet the actual needs of the people.In terms of the number of acres, small-tenant land tends to cost more for houses, roads, and fences than large-scale land, and it also brings more labor and incidental management costs to the landlord.Large farmers who own some good land can make good use of inferior land, while small tenants generally cannot prosper unless the soil is good.Therefore, the rent per acre (gross rent) of small farms is always higher than that of large farms.It may be asserted, however, that, especially when the land is densely populated, the landlords, unless they see that the rent of the small holdings, besides providing a high profit for their expenses, affords them a large insurance fund against the reconsolidation of the holdings. , they will never bear the cost of subdividing the farm.In many parts of the country, the rent of small tenant land (especially those with only a few acres) is extremely high.Sometimes the landlord's prejudice and sense of superiority lead him to flatly refuse to sell or lease land to those who do not share his views on socio-political or religious issues.It seems certain that this evil tends to occur in a few districts, and is decreasing day by day, but it does attract much attention; for the public in every district needs both large and small holdings, for cultivation and gardening; And generally they need small farms that are small enough to be run concurrently by people with other occupations. Finally, although smallholdings are not suited to the economic conditions of England, her soil, her climate, and her people, there are still a small number of smallholders in England who live happily under the circumstances.There are a few others who will buy small plots of land and be content to farm for a living if they can get only what they need when they need it.Their character is that they are willing to work hard and live frugally if they are not serving others.They like quiet, not excitement.They have a boundless love of the land.These people should be given a fair opportunity to use their savings to acquire small plots of land on which they can use their own hands to grow suitable crops; Severe legal fees. Cooperatives seemed to hold great promise in agriculture, combining the economy of large production with the pleasures and social interests of small production.All it takes is mutual trust and honesty.Regrettably, the bravest and most trustworthy villagers all moved into the city one after another, while the peasants left behind were suspicious and sentimental.However, Denmark, Italy, Germany, and Ireland have led promising co-operative movements in the distribution of dairy products, the manufacture of butter and milk cakes, the procurement of farmers' necessities, and the marketing of agricultural products.Britain is following them.But the movement was so narrowly defined that it barely touched on the field work itself. If the co-operative system accommodates all the virtues of tenancy, Irish tenancy often includes all the disadvantages; but the evils, and the causes of them, have all but disappeared, and the economic elements of the problem are now being replaced by political ones. shield.Therefore, we have to ignore it. Section X. Determination of normal prices and difficulties of normal harvests.Freedom for tenants to make improvements and to reap the fruits of their improvements. The failure of the English tenancy system in Ireland showed the difficulties inherent in it, which in England were concealed by the consonance of the system with the business habits and character of the people; The fact that the system is essentially a system of competition, and even the conditions of English agriculture give great resistance to the full exertion of free competition. First, there are special difficulties in ascertaining the facts on which competing effects must be based.As mentioned above, making agricultural accounting accurate can be difficult.Moreover, it must be reckoned that the farmer's calculation of the rent which would make him worthwhile is often hindered by the difficulty of ascertaining the normal crop and the normal level of prices.Because good and bad years are so intertwined, it would take many years to provide a reliable average.And during these years the circumstances of industry must have undergone great changes; the local wants, the conveniences which enable him to sell his own products in distant markets, and the conveniences which enable his distant competitors to sell in his local market, may all be related. There are changes. The landlord encounters this difficulty, and others, arising from the different standards of ability of the farmers in different parts of the country, in determining how much rent to charge.The producer surplus of a farm, or rent in England, is the excess of the return afforded by the produce of the farm over the cost of cultivation, including the normal profit of the farmer, assuming that the farmer's ability and enterprise are This is normal for this type of farm.The difficulty lies in deciding how to interpret the word "place" in a narrow sense or in a broad sense. It is obvious that if the power of the farmer is below the standard power of his district, if his only advantage lies in bargaining, if his total product is small, and his net product is even proportionately smaller; In this case, if the landlord hands over the farm to a more capable tenant, who can pay higher wages, get a much greater net product, and pay a higher rent, he acts on behalf of all Interests.Conversely, if the standard of local normal ability and entrepreneurial spirit is not high, it is obviously wrong from the ethical point of view for the landlord to try his best to extract more land rent from farmers who meet this standard than he can pay. Even if he could obtain that kind of land rent by moving from an area with a higher standard of ability to a farmer, it would be inappropriate. Closely connected with the above question is that the tenant should be free to exploit the natural potential of the land at his own risk, provided that, if he succeeds, he can make greater than normal business profits.Long tenancies, in respect of every small improvement, in a great measure overcome this difficulty.Scotland sees many in this regard, however, they also have their own shortcomings.As people often say, "Even when the English tenant has no right to rent, he always seems to have the right to rent." When the market is favorable to the farmer, he pays the whole rent, and avoids making demands on his landlord which might lead him to think whether the rent should not be increased.When the crops of the year are extremely unfavorable, the landlord, partly out of sympathy and partly as a duty, temporarily reduces the rent and bears the cost of repairs, which are usually borne by the farmer.It can be seen that although the nominal land rent remains unchanged between the landlord and the tenant, there are actually many phenomena of mutual accommodation. Custom often partly secured the English tenant's compensation for his improvements.Legislative aspects have lately kept pace with, if not surpassed, custom.The tenant is now practically not threatened with any increase in rent due to the rather improved increase in production which he has made.When he leaves, he may claim compensation for the unused value of the improvement, in an amount to be determined by the umpire. Section 11 Conflicts of Public and Private Interests Concerning Buildings, Open Spaces and Others. Finally, something must be said about the private and public interests of urban open space.Wakefield and other American economists have taught us that sparsely populated new areas are often enriched by the arrival of newcomers.The opposite principle is that in densely populated areas, poverty will be caused by building an additional house or building an extra floor.The want of fresh air and sunshine, of outdoor resting places for the games of all ages and children, drained the best Englishmen who were constantly flowing into the great cities.By allowing arbitrary construction on empty land, we are making a serious mistake from a corporate point of view.Because for a little material wealth we expend human energy, the factor of production of all wealth.We sacrifice those ends, and material wealth is only a means to that end.