The morning call., 1893-11-25
Private Ownership of Land ,
Growth.
AN ADJUNCT TO CIVILIZATION.
Socialism, Usury and Other COgnate
Subjects Touched Upon by
Professor Plehn.

Professor C. C. Plehn before a large and
much interested audience In the Art build
ing last evening.
The subject for the evening was "Capital
and interest,"" and a portion of the hour
was devoted to an explain alton OF the
theories of the Austrian school OF econo-
mists which have, of late, become popular
in this country.
Capital the professor defined as being
goods not consumed at once but inten-
tionally reserved, or even constructed, to
aid further production" In our present
social organization the possibility of the
existence of capital depends solely upon
the legal right Of private property. fact
which the socialists have grasped more
clearly than many economists.
Man is by nature social. Even In the
Bible we are told that "it is not good for
man to be alone" and Aristotle says "man
is political animal" Society is an Or
ganism without which production would
not take place. In early times authority
was in the hands of the father, thence il
passed into the hands OF body, and the
State comes inevitably to enforce the laws
of that body.
The earliest legal principle which was
established by custom was the law of
meum and tuum, but this was very slowly
extended to the ownership of land. which
is now a universal principle of civilized
society.
In the hunting stage of society capital
was the bow, arrows and hooks with which
primitive man supplied his simple wants.
In the nomadic stage forms of movable
capital increased largely. but land had lit
tie or no private value. Land In the agri.
cultural stage was, with the exception of
that necessary for private dwellings and
barnyards, community property, but this
common ownership passed directly into
the ownership of one, large-landed propri-
etOrs becoming the rule.
The commercial era introduced greater
mobility of capital, bills of exchange,
banking business and credit on a large
scale being established. Private owner
ship being protected by the State. capital
was made free to move about and large
accumulations of wealth in many forms
were made possible.
In highly civilized communities capital
takes many different forms. but it is neces-
sary to remember that certain forms of
property are not capital, such as wealth
intended for Immediate consumptlou-as
clothes, etc.-and property which is not
wealth but a condition thereto, as slaves,
water-power, land. etc. According to
ROscner the test as TO what is capital is
whether or not it is Intended to aid pro-
duction, test very easily applied.
In concluding this portion of his lecture
Professor Plehn stated that it should be
remembered that capital is the result OF
labor and the fruit of abstinence, but that
abstinence in this connection means SIM
ply refusal on the part of the owner to
consume the goods. not deprivation of any
kind. and that labor is dependent on cap
ital for its efficiency in all developed COM
munities.
Socialism has made in Europe and the
To Stetao hnuhaar of oil in
way which we here in the West can hardly
realize. The capitalist has the advantage
of being able to dictate to labor, and, il his
wishes are not regarded, lives upon his
capital in comfort. while the laborer must
submit or starve, but without labor cap
ital can never increase but must diminish,
therefore the two are mutually dependent.
Interest was next considered and was
defined as being that share of the annua!
increment of wealth which goes to she
| owner of a capital, although in giving this
definition the professor said that there was
difficulty in making an accurate one. be-
cause of the various elements usually
united in what is termed interest. Inter-
est, though forbidden by the Mosaic laws
and opposed by Aristotle and many 9TH
ers, was legalzed by the Greeks and
Romans. Usury laws arc always evaded
and are hurtful since they increase the
| burden to borrowers. The most famous
theory by which economists try to justify
interest is the abstinence theory, which
argues that the capitalist, because of his
refusal to consume his goods. saving them
TO assist future production, is entitled TO a
| return.
Another theory is that capital assist. in
dustry and the interest should be deter
mined by the amount of that assistance
This theory Professor Plehn thought very
| faulty, because of the difficulty In deter
mining what proportion of the product
should rightly belong to labor. The rate
| of interest on loans is determined appar-
emily by the law of supply and demand in
each particular case. A loan is q commo-
| dIty for sale, or rather, the credit that
| borrows is a commodity for sale. Ques-
! tious of risk, insurance. ETC., influence the
rate, but In good times interest is low. as
| capital then seeks investment, although in
rapidly growing communities it is higher
always than in older and queter ones. On
account. however. of the great m bility of
capital and the fact that the owner Is IN a
! position to overlook the whole market the
net interest is very nearly the same every
where. When, therefore. higher rate is
score of greater risk, or wages for the
labor in applying that capital more effec-
lively. Credit, which Is the result of
private property and advancing civilization
is a determining factor on the side of both
borrower and lender.
|
political econ omy. Professor Plehn said
that these economists are inclined to
''argue in circle" since many ideas which
they claim TO be new are simply old prin-
eiples in a new dress. Their theory of
value, which Is that value is a psycholog-
| ical estimate based ON final utility, though
unquestionably correct when used as a
key to unlock all the secrets of economics,
leads into grievOus wordiness and confu-
sion.
In conclusion, the lecturer spoke strongly
against the vicious error" that destruc-
tion of property makes work. and that a
spendthrift is blessing to a community.
"rhe man who does the most good in this
world" he said, sis he who builds a mill
and puts idle men to work for fair wages
and treats them justly. He Is true phil
anthropist. of whom the world may we'll
| be proud"
Tho next lecture will be "The Leader of
Industry and His Profits and the Attitude
| Of Socialism Toward Him."
Took Morphine.
An old man named August Scriber was