Feliciana sentinel. [volume] (St. Francisville, La.) 1877-1892, 1891-10-24

Rent ~ Part Of Cost,

AA naiyAlnS tno cost OF producing
commodities, rent is often named as an
element 1t Is said, for example, that
cost includes wages of labor, wear and
sear OF capital, interest on capital
taxes, interest on taxes, and rent. This
Is a mistake, and, for single tax advo.
Gates, dangerous one to make. If
rent were an element of cost it would
enter into the price of commodities,
thus shifting taxes on rent to the con.
sumner; and a shrcwd adversary, by
pointing out the deduction, might easily
confuse the single tax advocate who
was guilty of this false analysis
| A little reflection will make IL per.
| 1ectly clear that rent is no part either
OF cost or price. The only distinctive
al..r -A-A~.-A-----A ,-,--
nification, blackpail TIE former in
cludes wear and tear of capital and in
| terest on capital; the latter includes
taxes on labor interest on such taxes
and the exactions of monopoly. But
| normal rent is neither wages nor black
mail 1t is the difference in value be.
tween the least profitable opportunities
to which labor resorts, and better op-
portunities. 1t is not part Of cost, be.
cause at this least productive point
| there is no rent; and it does not enter
| into price, because price is determined
by cost of production.
The farmer who tills soil naturally
fertile gets in the same market no more
for his grain, bushel FOR bushel, than
the farmer who produces equally good
grain from less prolific soil; his ad.
vantage is his ability to produce moro
grain with equal labor, and the value
of this advantage determines the differ.
ence in rent between the two farms.
! The merchant who occupies choice
location in the heart of his business
district can charge 10 more for the
same goods than one whose store is on
cheaper ground; his advantage is his
ability to sell more goods in given time
and with given labor, and this advan.
tage determines the difference in rent
between the two places. The smoker
who buys his cigar where rents are
high pays no more, if as much, than
one who buys the same quality of cigar
where rents are low. The higher rents
of the former place are paid, not by
means of higher prices, but in couse.
quenccs of quicker sales. Wages, house
hire. value Of furniture and interest are
lower, relative to the volume of busi-
ness done, in places of high rents than
in places of low rents: and the accumula-
tion of these advantages constitutes the
difference in rent.
| 1t is obvious that rent in these Illus
trations is no part either OF cost OK
price. Supposing the poorer land in
| all the illustrations to command nc
rent, rent can not possibly be part OF
the cost of producing from it, or selling
| on it: and as produce sells at cost (cost
of selling included). rent can be no part
Of the price. And since this is so of
produce from the poorer land and Of
goods sold at the poorer locations,
it must be so of those produced from
and sold at the better. Or, as
equal commodities sell in the same
market at equal price, rent can not en-
ter into the price of one unless it en-
ters into the price of all: but it does
not enter into the price of produce from
| land bearing no rent, and. therefore,
| it can not enter into the price of land
bearing rent And, inasmuch no
product can sell continuously below
cost, the absence of rent as an element
of price proves its absence as an ele-
ment of cost For simplicity, we sup
pose the poorer opportunities in these
illustrations to be rent free: but the
principle would be the same if they
We're not, provided they commanded
lower rent than the better opportuni-
ties, as they undoubtedly would.
| Mr.. Edward Atkinson, of Boston, is
| one of the men who makes this mis-
| take of regarding rent as an element of
cost, and proclaims rather than argues
| that land value tax would be shifted.
| Because merchants and manufacturers
charge up their rent rs one of the items
! of their business expense, he infers
| that rent as we'll as wages is part of
the cost of produce, and that they en-
body it in the price of their goods. II
any man knows less about economic
/ principles than Mr. Atkinson, the aver
age merchant or manufacturer is that
man: it is. therefore quite appropriate
| that Mr.. Atkinson shoull offer as proof
! of one of his vagaries the form Of book
| keeping adopted by merchants and
| manufacturers. 1t Is Il modern instance
| Of the blind leading the blind
| When Mr. Atkinson shows that mer-
| chants and manufacturers whose rent
| charges are high, habitually sell the
same quality of goods for more than is
| got by competitors whose rent charges
are lower, his proof Will Lc pertinent.
| That which he now offers would be
ruled out as irrelevant aud incompcte Mt
in any court above the grade of n back
woods Justice of TIL. peace.
Good Roads Without Taxation.
| The chairman of the New York
| State Road InDrovcmpnt aSSociat ion