facts-and more especially as to facts relating to our own islands; and here again we have a proposition which can be tested by abundant evidence.

As I said just now, in the year 1800 the aggregate of incomes in Great Britain exceeding 60l. a year had been estimated for purposes of income-tax at something just over 100,000,0001. Experience and subsequent criticism showed this estimate to have been substantially correct; and out of this total it was agreed by all authorities that the rent of agricultural land accounted for about 30,000,000l.

Let us now turn to the year 1908. In that year the sum of all net private incomes in excess, not of 60l. a year but 1601., amounted to 788,000,000l. If the fundamental proposition of Henry George were correct, the land-rental, which formed at the dawn of the nineteenth century at least 30 per cent. of all incomes exceeding 601., would by this time form very much more than 30 per cent. of all incomes exceeding 1601. But what do we find to be the case? Let us turn to the assessments for that year under Schedule A, and take not only agricultural rent, which is given in a column by itself, but the rent of building-sites also, which is included in the assessment of houses. This being taken at as much as one-fifth of the total, the site-rental for that year will have amounted to about 42,000,000l.; while the gross rental of agricultural lands was about 52,000,000l.; the entire land-rental, as distinct from the rent of buildings, having amounted approximately to 94,000,000l. That is to say, whereas the rental of agricultural land alone amounted some hundred years ago to very nearly one-third of all incomes exceeding 601., the rental of such land with the rental of building-sites added to it forms to-day hardly so much as one-eighth of the total of all incomes exceeding 1601.

Let me mention one fact more, which is at once instructive and amusing. After he had, by his doctrine as to land-rent, achieved fame in America, George visited England with the object of preaching it there, and among the various promises held out by him to the people of this country, if only they would adopt his principles, and by means of a single tax make over all land-rent to the State, were the following-expressed in what substantially are his own words. Only give me,' he said, 'all the land-rents of the United Kingdom; and, besides performing without any farther taxes all the present functions of your Imperial and your local government, I will supply every house with free lighting and heat, and supply free power to every factory likewise.' These promises were made in the early 'eighties. The land-rent of the country at that time, apart from the rent of buildings, amounted in round figures to 89,000,000l. Now this sum would no doubt

have defrayed the Imperial expenditure of the time, and left 10 per cent. of surplus, but it would not have so much as approached what even at that time was the public expenditure as a whole, if the local be added to the Imperial. It may, however, in fairness to George, be urged that according to him land-rent would increase in the future far more rapidly than it had done even in the then recent past; and that he ought to be judged by what would be the situation to-day if the trial of his principles had been protracted up to the present time. Such a test is a fair one. Let us apply it. In the early 'eighties the Imperial expenditure of this country approached, but it did not reach, 80,000,000l. annually. In the year 1909 it amounted to 157,000,000l.—that is to say, there was an increase of approximately 77,000,000l. Let us now examine the returns relating to the rent of land. In the year 1886 the gross total of agricultural rents amounted to 63,000,000l., to which one-fifth of the rent of houses' must be added in respect of building-sites. These two sums together amount to 89,000,000l. Since the year 1886 the rent of buildingsites has risen from 26,000,000l. to 43,000,000l.—an increase of 17,000,000l.; and the rent of agricultural land has fallen from 63,000,000l. to 52,000,000l.-a decrease of 11,000,000l. ; the total land-rent to-day being about 95,000,000l. If, then, George's principles are to be tested, not by the results he could have extracted from them twenty-five years ago, but by those which he would, if alive, be able to extract to-day, we find that, instead of any vast surplus having developed itself, available for extending the present activities of the State and supplying everybody gratis with heat, light, and power, he would be faced with a deficit of considerably over 60,000,000l. before he had discharged the functions of the Imperial Government alone, and before he had spent a penny on roads, on drainage, or on education. In other words, instead of land-rent having increased more rapidly than public expenditure, one branch of public expenditure alone has increased almost exactly ten times as fast as land-rent.

And now let us close this question by comparing the increase of land-rent with the increase of incomes derived from other sources, as shown by the Commissioners of Inland Revenue in their reports for the years 1886 and 1909 respectively. The total reviewed under Schedules C, D, and E, together with the rental of buildings apart from sites, amounted in the year 1886 to 471,000,000l. The corresponding total for the year 1909 was 895,000,000l. Thus, both increases being taken at their gross amounts, the increase of income from sources other than land was 424,000,000l. ; while the corresponding gross increase from land, which is, according to George, swallowing up every increase from every other source, amounted to the sum, relatively microscopic, of 5,000,000l.

If anyone desire to verify these figures he need merely study for himself the Statistical Abstracts for the past twenty-five years, and compare either the gross or net amounts assessed in respect of land-rent (including one-fifth of the rent which is given as that of 'houses') with the gross or the net totals assessed or reviewed for the general purposes of income-tax, and he will find that, whereas about a quarter of a century ago land-rent formed 14 per cent. of the total, ten years later the proportion had sunk to 12 per cent., and is at the present time not so much as 91.

Figures might be multiplied in illustration of this same conclusion. It must suffice here to say that, in whatever way we approach the matter, we find that land-rent, rural and urban, instead of forming an increasing proportion of an increasing national income, forms year by year a quantity which is relatively less and less.

Here, then, we have before us two of the main assertions which figure in socialistic diagnoses of society as it is now-the assertion that every increase in the wealth produced under modern conditions is swallowed up by the rent of land; and the assertion that, under these same conditions, the number of moderate incomes has been constantly and is still diminishing-assertions insisted on with every variety of confident emphasis by the two most influential thinkers that the socialistic movement has produced; and we have seen that each of them is so absurdly and fantastically fallacious that it is not merely an ordinary untruth, but the truth turned upside down.

V

THE SOCIALISTIC ASSERTION THAT THE POORER CLASSES ARE

BECOMING POORER

I have, however, called attention to these particular assertions first, not because at this moment they are the most important of the fallacies here in question, but because they are representative, and because the refutation of them, lying as it does in a nutshell, will prepare the reader for an examination of a fallacy more important still. This is an assertion of far wider scope than those relating to the middle classes and the landowners. It is the assertion, which is still a commonplace on all socialistic platforms, that while, for more than a century, the modern capitalistic system has been making the rich richer, it has been making the poorer classes—or, in other words, the great majority of the population'ever poorer and poorer.' We shall find, when we put this to the test of definite facts, that this is an inversion of the truth even more preposterous than the others.

In order to test this assertion fairly, we must be careful to see what those by whom it is made mean by it. Even Marx himself,

who is mainly responsible for its acceptance, would not have denied that some members of the poorer classes, such as specially skilled craftsmen or mechanics, earn much higher wages now than were earned by any of their predecessors of a hundred years ago. The assertion is only meant to apply to the poorer classes as a whole; and it can only signify that the income which they enjoy collectively is growing less in proportion to the total number of the recipients, and would yield less and less to each, if year by year it were divided equally among all. It remains for us to consider who 'the poorer classes' are. How are they defined by those who make this assertion with regard to them? So far as our own country is concerned, the language of Socialists in their excursions into the domain of statistics show clearly enough how this phrase the poorer classes' is understood by them. They use it broadly as comprehending all such families as are supported on incomes which are not liable to income-tax, or which do not exceed 1601. a year; while the richer classes, though not the conspicuously rich, are invariably identified, for purposes of broad contrast, with those whose incomes are comprised in the aggregate on which tax is levied.

Let us, then, consider with as much precision as we can what is the aggregate to-day of individual earnings and incomes below the assessment limit of 160l. Our sources of information with regard to this question have during recent years increased to a remarkable degree, partly owing to fresh investigations on the part of the Board of Trade into the wages of manual labour, and partly owing to an inquiry, conducted with semi-official assistance, by a committee of eminent statisticians, into the earnings and incomes (not exceeding 1601.) of persons other than wage-earning manual workers. The results of this inquiry were submitted to the British Association at Sheffield, in a report which has since been published. It is impossible to discuss its details, which would involve a survey of some forty different groups of incomes; but the general conclusion there set forth is this: that the total income earned by the class in question-by the lower middle-class,' as it is often loosely called-amounts to over 300,000,000l. With regard to the wages of manual labour and services, the aggregate earned by twelve broadly distinguishable groups (of which all but two are under the cognisance of the Board of Trade) cannot amount, according to the latest evidence, to less than 860,000,000l.; though precise knowledge as to this point will be impossible till a complete analysis of the last Census returns shall have been issued. These two sums, which make a total of 1,160,000,000l., represent earned income only. To this must be added a further sum, amounting to something between 50,000,0001. and 60,000,000l., which arises from property and investments, the

distribution of which, as Mr. Bowley observes, is uncertain, but which the two classes here in question divide between them. The grand total of incomes not exceeding 1601. is thus not less, at all events, than 1,210,000,000l. The number of the population, exclusive of payers of income-tax and their families, may be taken at the present time as 37,000,000 or 38,000,000. Thus the average income per head of the population exempt from incometax-or, in other words, of the poorer classes,' as that phrase is generally understood-is appreciably in excess, to say the least of it, of 301. a year.

Let us now turn to the beginning of the nineteenth century. As I had occasion to mention just now, when dealing with the question of land-rent, the total of incomes exceeding 601. a year in Great Britain-for Ireland was not then included-did not amount to much more than 100,000,000l.; and the total income of Great Britain, according to the highest serious estimates, did but slightly exceed, if it amounted to, as much as 200,000,0001. What proportion of this went to persons with more, and what went to persons with less, than the particular sum of 160l. a year, we have no means of knowing, for, as Macullough with justifiable indignation observes, all the official records which might have given us such detailed information were destroyed. Such detailed information, however, will not be necessary here. Instead of dealing with the average income of one section of the population, let us take the nation as a whole, and consider what would then have been the average income per head if everything, from the earnings of the humblest casual labourer up to the profits of the greatest merchants, the rent-rolls of the greatest landowners, and the entire revenue of George III., with his civil list, had been pooled about sixteen years before the battle of Waterloo, and doled out in equal shares to everybody. The population of Great Britain was at that time 10,000,000. Thus, the average income per head-the maximum rendered possible by the whole existing wealth of the country-would have been 201., or, according to the computations of one sanguine statistician of the period, it might perhaps have amounted to 211.

What, then, when we compare them, do the figures for these two periods mean? They mean that the average income per head of the poorer classes to-day is greater by some 50 per cent. than the largest corresponding income which could possibly have been received by anybody if, at the time which Socialists describe as the dawn of modern capitalism, all the wealth of Great Britain had been nationalised by a socialistic State, and the dreams of the wildest of modern Socialists realised by a reduction of all the citizens to the same financial level. Or, to make the case yet more clear, we may present it to the imagination thus. If the