The independent. [volume] (Lincoln, Neb.) 1902-1907, 1903-08-20
RENT AND INTEREST.


the use of bare land.
Interest is generally used in the
sense of premium paid by the bor-
lower to the lender of money, and
think it should only be so used in
political economy; but until another
word is invented to take its place,
writer's on political economy are COM
| PEELED to use it in the sense of the in
come capitalists receive for the use of
capital; and it is exclusively In this
second sense that / use it in this
PAPER.
Rent and interest are alike in many
respects; SO much SO that some politi-
cal economists consider there is no
essential difference in their nature.
OF course the same economists can
see no essential difference between
property in land and property in the
products Of labor.
Let us consider first in what respects
rent and interest are similar.
Ground rent is what land is worth
fol use." Interest is what capital is
worth for use. Both are passive aids
to production, and both are absolute
ly necessary to civilized man.
Ground rent is paid for access to
natural opportunities. Interest for &C
cess to artificial opportunities.
The receiver of either rent or in
tnrest may live without labor.
Ground rent depends upon the sup
ply of and demand for land in favor
able situations and possessing desira-
BILE qualities Interest depends upon
the supply Of and demand for capital
that is, anything that aids labor in
Producing wealth, that is not free
gift of nature. All free gifts of ma
ture are included in the term land.
Now, let us consider some o. the es-
sential differences between land and
capital. Land is the natural heritage
OF mankind. Capital is the product of
labor. Property in land is created by
civil law. Property in the products of
labor is a natural right
The value Of land depends principal
ly upon it's situation. II it is near a
large center of population it is likely
to be of great value regardless of its
fertility; while, if it is situated so far
from market that its products won't
realize more than the cost of produc-
ton and transportation, no matter
how fertile it is, it has no value; and
great deal of good land is in this po-
sition. The value of other kinds of
wealth depends upon its situation, too;
but great deal of it is movable, and
with rare exceptions immovable wealth
is produced only where 1t is required,
end consequently has a value.
The value of land increases with the
increase of population; and every i'm
provement in methods of production,
or other advance in civilization, in
creases the value of land. The very
opposite is true OF capital and wealth |
generally. 1t has the greatest value,
where the demand for it is greatest in |
proportion to the supply; and that is |
generally where land is plentiful and |
cheap. In progressive communities |
wealth increases faster than popula- |
ton, rent rises as land becomes scarce,
and interest falls as capital becomes
plentiful.
These differences in the nature of /
rent and interest are important: and |
Justify treating land and capital as
separate factors in production.
There was an interesting discussion
on this subject by professors Of po-
l'tical economy at a banquet of the
Single Tax league, at
Eoston, December s, 1862, and some
quotations from the different speakers
may help US to get clear understand
ing of the subject. Professor Bullock
said: Ground rent, or the income re-
eeived by the owner of land, is a con-
cept that is sufficiently broad to in
clude all income that is derived from
the control of natural agents Of pro-
duction. He who would utilize a wa
ter power or draw from beneath the
surface of the earth the mineral treas
lIes deposited there in bygone ages.
rust, no less than the farmer, the
or the merchant, enjoy
access TO some particular tract OF land.
For this reason, suppose, the defini-
ION formulated as the outcome of the
conducted by the Sin
gle Tax league during the past year,
declares that land value is the value
If situation, with all the rights and
privileges pertaining to the occupancy
hereof The annual value IF
and depends upon the conditions of
'emand and supply. The demand price
1aries according to the advantages
which land offers for production. and