Book V.—THE PROBLEM SOLVED

Auckland Star, Volume XX, Issue 147, 22 June 1889, Page 4 (Supplement)

Book V.—THE PROBLEM SOLVED

Chapter I.—The main cause of periodical industrial deore__ions is the manner in which the speculative advance in land values cuts down the earnings of labour and capital and checks production. In a progressive community land constantly increases in value; this induces speculation in which future increase is anticipated ; and when land value 3 are carried beyond the point at which they leave to labour and capital their accustomed returns, production begins to stop, or, what in a progressive community is the same thing, fails to increase proportionately, owing to the failure of new increments of labour and capital to find employment at the accustomed rates. The stoppage at some points shows itself at other points in a cessation of demand, which checks production there, and thus the paralysis. communicates itself through all the interfacings of industry and commerce, resulting in phenomena that seem to show overproduction or over consumption, according to the standpoint from which they are viewed. The depression continues until (l)the speculative advance in land values is lost; or (2) the efficiency of labour increases sufficiently to mako the normal rent line overtake the speculative rent line : (3) labour and capital become reconciled to smaller returns ; or (4) all three of these causes co-operate to produce a new equilibrium, at which a new system of activity ensues, followed by an advance of rent, further speculation in land, another check upon production, and the same round over again.

Chapter ll.—The reason why, in spite of the increase of productive power, wages constantly tend to a minimum which will give but a bare living, is thab with increase in productive poiver, rent tends to even greater increase, thus producing a constant tendency to the forcing down of wages. The direcb tendency of advancing civilisation is to increase the power of human labour to satisfy human desires, to extirpate poverty, and to banish want .and the fear of wanb ; bub labour cannob reap bhe benefits because they are intercepted. Land being necessary to labour and being reduced to private ownership, every increase in the productive power of labour but increases renb—bhe price labour must pay for the opportunity to utilise its powers. And, begotten of the continuous advance of rents, arises a speculative tendency which discounts the effect of future improvements by a still further advance of rents and tends to drive wages to the point at which the labourer can just live.