Are Ground Rents Passed On by Sellers of Goods?
[Reprinted from Land and Freedom, May-June,
In the controversy as to whether or not rent enters into price it
would appear the arguments made pro and con are too inconclusive to be
unanimously accepted. To clear the ground and clarify the problem I
think it should be noted that Rent always reflects an inherent or
adhering USE value, whereas Price, just as invariably, reflects
EXCHANGE value. This distinction is vital.
To illustrate let us take a farm above the margin of cultivation and
where the rent is paid in kind. Let the crop harvested be 1,000
bushels of wheat and we find, irrespective of the division between
Landlord and Tenant and be that harsh or easy on its arrival in the
market, the higgling therein, under the dominant law of Supply and
Demand, sets an exchange value on the total quantity. This value when
apportioned to a measured quantity makes its price, and price is
exchange value expressed in the common denominator, money. Let the
user of land ship to market a product not demanded there and he will
have his labor for his pains, no matter what rent he has paid. So,
rent does not enter into price.
Look over the world today. In the West they are burning wheat and
corn for fuel; Brazil is throwing millions of bags of coffee into the
sea; sugar in Cuba, produced by starving laborers, is selling c.i.f.
at three quarters of a cent a pound in New York. Would you raise the
rent to increase the price?
I hold no brief for the landlord yet I would like to point out that
the landlord cannot levy a toll on the transportation of merchandise,
for the charge on that is for carrier's service and is based on so
much per ton mile, irrespective of the varying values of the lands
passed by in transit. That the landlord may charge the user of land
for the advantage of location near roads is certain, but neither the
landlord nor tenant can shift that charge over to the carrier.