Natural Agents as Requisites of Production
( Originally Published Early 1900's )
WE have seen that raw material and natural productions are the first and most necessary requisites of production. Were these requisites obtainable by all the world in unlimited quantities, the state of society would be entirely different from what it is. But if we look around us we shall see that while the supply of some agents is substantially unlimited, that of others is either limited in quantity or accessibility. The supply of air is unlimited. The limitations upon the supply of water for household purposes are so few as to be hardly worth taking into account. But the case is very different with land and metalliferous ores. The farms are necessarily limited to the forty or fifty million of square miles comprising the surface of the continents and islands of the earth; and if we take out those portions which are either uninhabited or useless, the actual available supply of land will be much smaller. Ores and minerals are yet more limited in quantity. The streams which can furnish water-power are generally few in any one country. The result of this is that it is physically impossible for every one to command all of these requisites of production which he needs or may think he needs.
In a primitive state of society we might imagine every man to be allowed to avail himself of his share of the raw material supplied by nature without money and without price. There are enthusiasts who advocate the trial of such a system at the present time. But a slight examination will show us that it would be contrary to the instincts of human nature which rule us in such cases, and would be impracticable of execution as things now exist. We have first to show by what instincts of human nature the right .of property in an object supplied - by nature is recognized.
Of Appropriation. If we look back into history to learn how land, minerals, and other agents supplied by nature could be owned by individuals, we shall find it to be through the right of appropriation. There is a natural feeling in the breast of each man that if he discovers something which was not previously known, or at least was not valued or used by any one else, he has the right to claim it as his property, so far at least as he is able to take possession of it. This right, however, speedily becomes limited and regulated by governments, which claim the right to make laws on the subject. The general rule is that if an island or any new land is discovered by a citizen of any country, the government of that country claims the right to ownership. Thus a large part of the American continent was at one time considered the property of one or another of the governments of Europe which had sent out expeditions for its discovery. Thus also England at various times became the owner of numerous islands which were discovered by her navigators in every part of the globe. In new countries the land is considered the property of the government, which sells it to individuals. Thus in most of the British colonies there are large tracts of land, known as crown lands, not yet occupied by settlers, but which may be sold to them as they require it. So, also, the United States Government owns large tracts known as " public lands" in the western Territories, and derives an income of several million dollars per annum from their sale. When the land thus becomes the property of the individual, his right to dispose of it is, with some exceptions, as absolute as his right to dispose of anything he has himself made.
The government claims not only the land, but all the minerals which may be concealed beneath it; an individual becomes the owner of such wealth by first discovering that it exists. He goes out "prospecting" on some portion of the public lands where his geological knowledge may lead him to infer the existence of minerals, and. if he thinks he has discovered ores of value he may purchase from the government the right to dig a mine and appropriate all the ores he finds to his own use. Nearly the same rule holds in the case of diamonds. When, for example, the great diamond-fields were discovered in South Africa, the exclusive right to gather them was granted to certain companies. Thus we perceive the operation of the fundamental principle already alluded to, that, by the instincts of our nature, the act of discovering and taking possession of land gives the right of ownership, subject to such limitations as the supreme power may enact. Now this system has both its abuses and its reasons. Let us consider first the reasons for it.
Necessity of the Right of Property in Natural Agents. If the condition of land and minerals were such that each individual could avail himself of them without labor, the case would be much stronger in favor of those who would restrict or deny the right of appropriation. But a little consideration will show that, as a matter of fact, it is impossible to make any arrangements for the possession of natural agents without devoting labor to them. Take first the case of land. Before a crop can be raised from it, trees must be cut down, fences built, barns and other structures erected, and fertilizers purchased and applied to the fields. It is not worth while to make these improvements unless the person who makes them is to have the benefit of them. But it is impossible to separate them from the land. He cannot carry away the house, the stables, the fences, or the fertilizers. Thus he cannot be deprived of his right in the land without interfering with his exclusive right to the product of his own labor.
In the case of anything concealed beneath the soil, discovery is necessary before it can be utilized. Now the process of discovery is one which requires skill and may involve great labor and hardship. No one is going to subject himself to this hard-ship unless he is to reap the fruit of his discovery. Practically, therefore, the right of appropriation in natural agents cannot be denied without denying the right of property in the product of one's own labor. Moreover, the right to find a mine or to preempt a farm is not confined to any particular persons or class of persons, but is equally enjoyed by every one who chooses to avail himself of his opportunities. Thus natural agents become private property by a logical necessity which mankind have in all ages been obliged to accept.
Objections stated. It must be recognized that as the population of a region increases, notwithstanding the necessity just shown, the supply of natural agents becomes scarce. The general rule is that when land is first occupied, or any natural product discovered, its value is very slight. No limitation is placed upon the quantity which any one person may own, and thus there is nothing in the way of an individual possessing himself of entire counties and perhaps owning the whole of a valuable mine. Now if population did not increase there would be no objection to this. But it often happens that the land so little valued by one generation is of the greatest importance to subsequent generations who come into the world finding that their ancestors. have permitted this valuable gift of nature to be inherited by a few individuals. Thus in England more than half the land is nominally owned by a comparatively small number of people. In every part of the world valuable mines of coal. and of iron, the products of which are most necessary to the community at large, are held by a few individuals or companies, who can command a price for what was originally a gift of nature. Hence the view that this system is wrong, and that the right of every human being to his share of the gifts of nature should be recognized, is not an unreasonable one.
But when we examine more closely we shall see that this evil is to a great extent compensated in various ways. We can at present only indicate the compensations in a general way, because the full treatment of the subject requires a knowledge of economical theories yet to be acquired. In the first place, we readily see that if every one were allowed at pleasure to avail himself of all the raw materials of nature, they would be speedily exhausted, so that none might be left for posterity.
Hence it would be necessary to prescribe how much coal or iron or other minerals each individual should have. The practical difficulties in doing this would be insurmountable. But under our actual system the care which every prudent person takes of his own property is extended by the owners of natural agents to their property, and thus the contents of the great storehouses of nature are protected from waste.
Again, self-interest prompts the owners to allow the public the benefit of their possessions on nearly as good terms as the public could command if the property were public. It is true, theoretically at least, that if the right of the land-owner is completely unrestricted he could fence in his land and forbid its being applied to any useful purpose. Practically, however, this cannot be done. Should it be attempted, we may be sure that society would find a way of remedying the matter. An example of how readily law is provided to meet a difficult case is afforded by the decisions affecting the rights and obligations of irrigating companies in the arid regions west of the Rocky Mountains, and especially on the Pacific coast. Here the very existence of the farming population depends upon a supply of water from mountain-streams which are in the possession of companies who have collected the water in reservoirs and constructed the conduits and other appliances necessary to supply the farms. Suits by the farmers against the companies are not uncommon, and the general result has been a body of law which insures to every farmer his supply of water on the same terms that his neighbors get it, and as completely as if the works of the irrigating companies were public property. In England the rights of the Iandlord are far more restricted than in America. Neither law nor public opinion allows him to charge as much as he pleases for his land, as he may do with us.
When we are in doubt between opposing reasons we may often appeal with advantage to the instincts of human nature. The fact that men of all races are ready to fight for their land may decide the question for us.