V. Métayage and Peasant Proprietorship of Land Parcels
We have now arrived at the end of our elaboration of ground rent. In all these forms of ground rent, whether labour rent, rent in kind, or money rent (as merely a changed form of rent in kind), the one paying rent is always supposed to be the actual cultivator and possessor of the land, whose unpaid surplus labour passes directly into the hands of the landlord. Even in the last form, money rent in so far as it is "pure", i. e., merely a changed form of rent in kind — this is not only possible, but actually takes place.
As a transitory form from the original form of rent to capitalist rent, we may consider the metayer system, or share-cropping, under which the manager (farmer) furnishes labour (his own or another's), and also a portion of working capital, and the landlord furnishes, aside from land, another portion of working capital (e. g., cattle), and the product is divided between sharecropper and landlord in definite proportions which vary from country to country. On the one hand, the farmer here lacks sufficient capital required for complete capitalist management. On the other hand, the share here appropriated by the landlord does not bear the pure form of rent. It may actually include interest on the capital advanced by him and an excess rent. It may also absorb practically the entire surplus labour of the farmer, or leave him a greater or smaller portion of this surplus labour. But, essentially, rent no longer appears here as the normal form of surplus value in general. On the one hand, the sharecropper, whether he employs his own or another's labour, is to lay claim to a portion of the product not in his capacity as labourer, but as possessor of part of the instruments of labour, as his own capitalist. On the other hand, the landlord claims his share not exclusively on the basis of his landownership, but also as lender of capital.44a'
A survival of the old communal ownership of land, which had endured after the transition to independent peasant farming, e. g., in Poland and Rumania, served there as a subterfuge for effecting a transition to the lower forms of ground rent. A portion of the land
[44]"i Cf. Buret, Tocqueville, Sismondi.(1) belongs to the individual peasant and is tilled independently by him. Another portion is tilled in common and creates a surplus product, which serves partly to cover community expenses, partly as a reserve in cases of crop failure, etc. These last two parts of the surplus product, and ultimately the entire surplus product including the land upon which it has been grown, are more and more usurped by state officials and private individuals, and thus the originally free peasant proprietors, whose obligation to till this land in common is maintained, are transformed into vassals subject either to corvée labour or rent in kind, while the usurpers of common land are transformed into owners, not only of the usurped common lands, but even the very lands of the peasants themselves.
We need not further investigate slave economy proper (which likewise passes through a metamorphosis from the patriarchal system mainly for home use to the plantation system for the world market) nor the management of estates under which the landlords themselves are independent cultivators, possessing all instruments of production, and exploiting the labour of free or unfree bondsmen, who are paid either in kind or money. Landlord and owner of the instruments of production, and thus the direct exploiter of labourers included among these elements of production, are in this case one and the same person. Rent and profit likewise coincide then, there occurring no separation of the different forms of surplus value. The entire surplus labour of the labourers, which is manifested here in the surplus product, is extracted from them directly by the owner of all instruments of production, to which belong the land and, under the original form of slavery, the immediate producers themselves. Where the capitalist outlook prevails, as on American plantations, this entire surplus value is regarded as profit; where neither the capitalist mode of production itself exists, nor the corresponding outlook has been transferred from capitalist countries, it appears as rent. At any rate, this form presents no difficulties. The income of the landlord, whatever it may be called, the available surplus product appropriated by him, is here the normal and prevailing form, whereby the entire unpaid surplus labour is directly appropriated, and landed property forms the basis of such appropriation.
Further, proprietorship of land parcels. The peasant here is simultaneously the free owner of his land, which appears as his principal instrument of production, the indispensable field of employment for his labour and his capital. No lease money is paid under this form.
Rent, therefore, does not appear as a separate form of surplus value, although in countries in which otherwise the capitalist mode of production is developed, it appears as a surplus profit compared with other lines of production; but as surplus profit which, like all proceeds of his labour in general, accrues to the peasant.
This form of landed property presupposes, as in the earlier older forms, that the rural population greatly predominates numerically over the town population, so that, even if the capitalist mode of production otherwise prevails, it is but relatively little developed, and thus also in the other lines of production the concentration of capital is restricted to narrow limits and a fragmentation of capital predominates. In the nature of things, the greater portion of agricultural produce must be consumed as direct means of subsistence by the producers themselves, the peasants, and only the excess above that will find its way as commodities into urban commerce. No matter how the average market price of agricultural products may here be regulated, differential rent, an excess portion of commodity prices from superior or more favourably located land, must evidently exist here as much as under the capitalist mode of production. This differential rent exists, even where this form appears under social conditions, under which no general market price has as yet been developed; it appears then in the excess surplus product. Only then it flows into the pockets of the peasant whose labour is realised under more favourable natural conditions. The assumption here is generally to be made that no absolute rent exists, i. e., that the worst soil does not pay any rent — precisely under this form where the price of land enters as a factor in the peasant's actual cost of production whether because in the course of this form's further development either the price of land has been computed at a certain money value, in dividing up an inheritance, or, during the constant change in ownership of an entire estate, or of its component parts, the land has been bought by the cultivator himself, largely by raising money on mortgage; and, therefore, where the price of land, representing nothing more than capitalised rent, is a factor assumed in advance, and where rent thus seems to exist independently of any differentiation in fertility and location of the land. For, absolute rent presupposes either realised excess in product value above its price of production, or a monopoly price exceeding the value of the product. But since agriculture here is carried on largely as cultivation for direct subsistence, and the land exists as an indispensable field of employment for the labour and capital of the majority of the population, the regulating market price of the product will reach its value only under extraordinary circumstances. But this value will, generally, be higher than its price of production owing to the preponderant element of living labour, although this excess of value over price of production will in turn be limited by the low composition even of nonagricultural capital in countries with an economy composed predominantly of land parcels. For the peasant owning a parcel, the limit of exploitation is not set by the average profit of capital, in so far as he is a small capitalist; nor, on the other hand, by the necessity of rent, in so far as he is a landowner. The absolute limit for him as a small capitalist is no more than the wages he pays to himself, after deducting his actual costs. So long as the price of the product covers these wages, he will cultivate his land, and often at wages down to a physical minimum. As for his capacity as land proprietor, the barrier of ownership is eliminated for him, since it can make itself felt only vis-à-vis a capital (including labour) separated from landownership, by erecting an obstacle to the investment of capital. It is true, to be sure, that interest on the price of land — which generally has to be paid to still another individual, the mortgage creditor — is a barrier. But this interest can be paid precisely out of that portion of surplus labour which would constitute profit under capitalist conditions. The rent anticipated in the price of land and in the interest paid for it can therefore be nothing but a portion of the peasant's capitalised surplus labour over and above the labour indispensable for his subsistence, without this surplus labour being realised in a part of the commodity value equal to the entire average profit, and still less in an excess above the surplus labour realised in the average profit, i. e., in a surplus profit. The rent may be a deduction from the average profit, or even the only portion of it which is realised. For the peasant parcel holder to cultivate his land, or to buy land for cultivation, it is therefore not necessary, as under the normal capitalist mode of production, that the market price of the agricultural products rise high enough to afford him the average profit, and still less a fixed excess above this average profit in the form of rent. It is not necessary, therefore, that the market price rise either up to the value or the price of production of his product. This is one of the reasons why grain prices are lower in countries with predominant small peasant land proprietorship than in countries with a capitalist mode of production. One portion of the surplus labour of the peasants, who work under the least favourable conditions, is bestowed gratis upon society and does not at all enter into the regulation of price of production or into the creation of value in general. This lower price is consequently a result of the producers' poverty and by no means of their labour productivity.
This form of free self-managing peasant proprietorship of land parcels as the prevailing, normal form constitutes, on the one hand, the economic foundation of society during the best periods of classical antiquity, and on the other hand, it is found among modern nations as one of the forms arising from the dissolution of feudal landownership. Thus, the YEOMANRY in England,[87] the peasantry in Sweden, the French and West German peasants. We do not include colonies here, since the independent peasant there develops under different conditions.
The free ownership of the self-managing peasant is evidently the most normal form of landed property for small-scale operation, i. e., for a mode of production, in which possession of the land is a prerequisite for the labourer's ownership of the product of his own labour, and in which the cultivator, be he free owner or vassal, always must produce his own means of subsistence independently, as an isolated labourer with his family. Ownership of the land is as necessary for full development of his mode of production as ownership of tools is for free development of handicraft production. Here is the basis for the development of personal independence. It is a necessary transitional stage for the development of agriculture itself. The causes which bring about its downfall show its limitations. These are: Destruction of rural domestic industry, which forms its normal supplement as a result of the development of large-scale industry; a gradual impoverishment and exhaustion of the soil subjected to this cultivation; usurpation by big landowners of the common lands, which constitute the second supplement of the management of land parcels everywhere and which alone enable it to raise cattle; competition, either of the plantation system or large-scale capitalist agriculture. Improvements in agriculture, which on the one hand cause a fall in agricultural prices and, on the other, require greater outlays and more extensive material conditions of production, also contribute towards this, as in England during the first half of the 18th century.
Proprietorship of land parcels by its very nature excludes the development of social productive forces of labour, social forms of labour, social concentration of capital, large-scale cattle-raising, and the progressive application of science.
Usury and a taxation system must impoverish it everywhere. The expenditure of capital in the price of the land withdraws this capital from cultivation. An infinite fragmentation of means of production, and isolation of the producers themselves. Monstrous waste of human energy. Progressive deterioration of conditions of production and increased prices of means of production — an inevitable law of proprietorship of parcels. Calamity of seasonal abundance for this mode of production.[45]
One of the specific evils of small-scale agriculture where it is combined with free landownership arises from the cultivator's investing capital in the purchase of land. (The same applies also to the transitory form, in which the big landowner invests capital, first, .to buy land, and second, to manage it as his own tenant farmer.) Owing to the changeable nature which the land here assumes as a mere commodity, the changes of ownership increase,[46]' so that the land, from the peasant's viewpoint, enters anew as an investment of capital with each successive generation and division of estates, i.e., it becomes land purchased by him. The price of land here forms a weighty element of the individual unproductive costs of production or cost price of the product for the individual producer.
The price of land is nothing but capitalised and therefore anticipated rent. If capitalist methods are employed by agriculture, so that the landlord receives only rent, and the farmer pays nothing for land except this annual rent, then it is evident that the capital invested by the landowner himself in purchasing the land constitutes indeed an interest-bearing investment of capital for him, but has absolutely nothing to do with capital invested in agriculture itself. It forms neither a part of the fixed, nor of the circulating, capital employed here 47); it
[45] Sec the speech from the throne of the King of France in Tooke.(2)
[46] See Mounier and Rubichon.b
[47] Dr. H. Maron (Extensiv oder Intensiv?)jj'no further information given about this pamphlet// starts from the false assumption of the adversaries he opposes. He assumes that capital invested in the purchase of land is "investment capital", and then engages in a controversy about the respective definitions of investment capital and working capital, that is, fixed and circulating capital. His wholly amateurish conceptions of capital in general, which may be excused incidentally in one who is not an economist in merely secures for the buyer a claim to receive annual rent, but has absolutely nothing to do with the production of the rent itself. The buyer of land just pays his capital out to the one who sells the land, and the seller in return relinquishes his ownership of the land. Thus this capital no longer exists as the capital of the purchaser; he no longer has it; therefore it does not belong to the capital which he can invest in any way in the land itself. Whether he bought the land dear or cheap, or whether he received it for nothing, alters nothing in the capital invested by the farmer in his establishment, and changes nothing in the rent, but merely alters the question whether it appears to him as interest or not, or as higher or lower interest respectively.
Take, for instance, the slave economy. The price paid for a slave is nothing but the anticipated and capitalised surplus value or profit to be wrung out of the slave. But the capital paid for the purchase of a slave does not belong to the capital by means of which profit, surplus labour, is extracted from him. On the contrary. It is capital which the slaveholder has parted with, it is a deduction from the capital which he has available for actual production. It has ceased to exist for him, just as capital invested in purchasing land has ceased to exist for agriculture. The best proof of this is that it does not reappear for the slaveholder or the landowner except when he, in turn, sells his slaves or land. But then the same situation prevails for the buyer. The fact that he has bought the slave does not enable him to exploit the slave without further ado. He is only able to do so when he invests some additional capital in the slave economy itself.
The same capital does not exist twice, once in the hands of the seller, and a second time in the hands of the buyer of the land. It passes from the hands of the buyer to those of the seller, and there the matter ends. The buyer now no longer has capital, but in its stead a piece of land. The circumstance that the rent produced by a real investment of capital in this land is calculated by the new landowner as interest on capital which he has not invested in the land, but given away to acquire the land, does not in the least alter the economic nature of the land factor, any more than the circumstance that someone has paid £1,000 for 3 % consols has anything to do with the capital out of whose revenue the interest on the national debt is paid.
In fact, the money expended in purchasing land, like that in purchasing government bonds, is merely capital in itself, just as any value sum is capital in itself, potential capital, on the basis of the capitalist mode of production. What is paid for land, like that for government bonds or any other purchased commodity, is a sum of money. This is capital in itself, because it can be converted into capital. It depends upon the use put to it by the seller whether the money obtained by him is really transformed into capital or not. For the buyer, it can never again function as such, no more than any other money which he has definitely paid out. It figures in his accounts as interest-bearing capital, because he considers the income, received as rent from the land or as interest on state indebtedness, as interest on the money which the purchase of the claim to this revenue has cost him. He can only realise it as capital through resale. But then another, the new buyer, enters the same relationship maintained by the former, and the money thus expended cannot be transformed into actual capital for the expender through any change of hands.
In the case of small landed property the illusion is fostered still more that land itself possesses value and thus enters as capital into the price of production of the product, much as machines or raw materials. But we have seen that rent, and therefore capitalised rent, the price of land, can enter as a determining factor into the price of agricultural products in only two cases. First, when as a consequence of the composition of agricultural capital — a capital which has nothing to do with the capital invested in purchasing land — the value of the products of the soil is higher than their price of production, and market conditions enable the landlord to realise this difference. Second, when there is a monopoly price. And both are least of all the case under the management of land parcels and small landownership because precisely here production to a large extent satisfies the producers' own wants and is carried on independently of regulation by the average rate of profit. Even where cultivation of land parcels is conducted upon leased land, the lease money comprises, far more so than under any other conditions, a portion of the profit and even a deduction from wages; this money is then only a nominal rent, not rent as an independent category as opposed to wages and profit.
The expenditure of money capital for the purchase of land, then, is not an investment of agricultural capital. It is a decrease pro tanto in the capital which small peasants can employ in their own sphere of production. It reduces pro tanto the size of their means of production and thereby narrows the economic basis of reproduction. It subjects the small peasant to the money-lender, since credit proper occurs but rarely in this sphere in general. It is a hindrance to agriculture, even where such purchase takes place in the case of large estates. It contradicts in fact the capitalist mode of production, which is on the whole indifferent to whether the landowner is in debt, no matter whether he has inherited or purchased his estate. The nature of management of the leased estate itself is not altered whether the landowner pockets the rent himself or whether he must pay it out to the holder of his mortgage.
We have seen that, in the case of a given ground rent, the price of land is regulated by the interest rate. If the rate is low, then the price of land is high, and vice versa. Normally, then, a high price of land and a low interest rate should go hand in hand, so that if the peasant paid a high price for the land in consequence of a low interest rate, the same low rate of interest should also secure his working capital for him on easy credit terms. But in reality, things turn out differently when peasant proprietorship of land parcels is the prevailing form. In the first place, the general laws of credit are not adapted to the farmer, since these laws presuppose a capitalist as the producer. Secondly, where proprietorship of land parcels predominates — we are not referring to colonies here — and the small peasant constitutes the back-bone of the nation, the formation of capital, i. e., social reproduction, is relatively weak, and still weaker is the formation of loanable money capital, in the sense previously elaborated. This presupposes the concentration and existence of a class of idle rich capitalists (Massie).(3)
Thirdly, here where the ownership of the land is a necessary condition for the existence of most producers, and an indispensable field of investment for their capital, the price of land is raised independently of the interest rate, and often in inverse ratio to it, through the preponderance of the demand for landed property over its supply. Land sold in parcels brings a far higher price in such a case than when sold in large tracts, because here the number of small buyers is large and that of large buyers is small (Bandes Noires,[88] Rubichonb; Newmanc). For all these reasons, the price of land rises here with a relatively high rate of interest. The relatively low interest, which the peasant derives here from the outlay of capital for the purchase of land (Mounier,(4)) corresponds here, on the other side, to the high usurious interest rate which he himself has to pay to his mortgage creditors. The Irish system bears out the same thing, only in another form.
The price of land, this element foreign to production in itself, may therefore rise here to such a point that it makes production impossible (Dombasleb).
The fact that the price of land plays such a role, that purchase and sale, the circulation of land as a commodity, develops to this degree, is practically a result of the development of the capitalist mode of production in so far as a commodity is here the general form of all products and all instruments of production. On the other hand, this development takes place only where the capitalist mode of production has a limited development and does not unfold all of its peculiarities, because this rests precisely upon the fact that agriculture is no longer, or not yet, subject to the capitalist mode of production, but rather to one handed down from extinct forms of society. The disadvantages of the capitalist mode of production, with its dependence of the producer upon the money price of his product, coincide here therefore with the disadvantage occasioned by the imperfect development of the capitalist mode of production. The peasant turns merchant and industrialist without the conditions enabling him to produce his products as commodities.
The conflict between the price of land as an element in the producers' cost price and no element in the price of production of the product (even though the rent enters as a determining factor into the price of the agricultural product, the capitalised rent, which is advanced for 20 years or more, by no means enters as a determinant) is but one of the forms manifesting the general contradiction between private landownership and a rational agriculture, the normal social utilisation of the soil. But on the other hand, private landownership, and thereby expropriation of the direct producers from the land — private landownership by the one, which implies lack of ownership by others — is the basis of the capitalist mode of production.
Here, in small-scale agriculture, the price of land, a form and result of private landownership, appears as a barrier to production itself.
In large-scale agriculture, and large estates operating on a capitalist basis, ownership likewise acts as a barrier, because it limits the tenant farmer in his productive investment of capital, which in the final analysis benefits not him, but the landlord. In both forms, exploitation and squandering of the vitality of the soil (apart from making exploitation dependent upon the accidental and unequal circumstances of individual producers rather than the attained level of social development) takes the place of conscious rational cultivation of the soil as eternal communal property, an inalienable condition for the existence and reproduction of a chain of successive generations of the human race. In the case of small property, this results from the lack of means and knowledge of applying the social labour productive power. In the case of large property, it results from the exploitation of such means for the most rapid enrichment of farmer and proprietor. In the case of both through dependence on the market price.
All critique of small landed property resolves itself in the final analysis into a criticism of private ownership as a barrier and hindrance to agriculture. And similarly all countercriticism of large landed property. In either case, of course, we leave aside all secondary political considerations. This barrier and hindrance, which are erected by all private landed property vis-à-vis agricultural production and the rational cultivation, maintenance and improvement of the soil itself, develop on both sides merely in different forms, and in wrangling over the specific forms of this evil its ultimate cause is forgotten.
Small landed property presupposes that the overwhelming majority of the population is rural, and that not social, but isolated labour predominates; and that, therefore, under such conditions wealth and development of reproduction, both of its material and spiritual prerequisites, are out of the question, and thereby also the prerequisites for rational cultivation. On the other hand, large landed property reduces the agricultural population to a constantly falling minimum, and confronts it with a constantly growing industrial population crowded together in large cities. It thereby creates conditions which cause an irreparable break in the coherence of social interchange prescribed by the natural laws of life. As a result, the vitality of the soil is squan-dered, and this prodigality is carried by commerce far beyond the borders of a particular state (Liebig).(5) While small landed property creates a class of barbarians standing halfway outside of society, a class combining all the crudeness of primitive forms of society with all the anguish and misery of civilised countries, large landed property undermines labour power in the last region, where its prime energy seeks refuge and stores up its strength as a reserve fund for the regeneration of the vital force of nations — on the land itself. Large-scale industry and large-scale mechanised agriculture work together. If originally distinguished by the fact that the former lays waste and destroys principally labour power, hence the natural force of human beings, whereas the latter more directly exhausts and ruins the natural vitality of the soil, they join hands in the further course of development in that the industrial system in the countryside also enervates the labourers, and industry and commerce on their part supply agriculture with the means for exhausting the soil.
Endnotes
[44] The reference is to the coalition wars of the European states against revolutionary and Napoleonic France lasting from 1792 to 1815. The Crimean War of 1853-56 was a war between Russia and a coalition of Britain, France, Turkey and the Kingdom of Sardinia (Piedmont).—421
[87] Yeomen — English freeholders who had largely disappeared by approximately the mid-18th century partly as a result of the primitive accumulation of capital, which took the form of communal land enclosure and its appropriation by the landlords. The Yeomen were excellent archers and, before the spread of firearms, usually formed the main force of the English troops. Yeomen were superseded by small tenant farmers.—793
[47] Marx is presumably referring to Chapter II of W. Petty's Verbum Sapiently, or an Account of the Wealth and Expences of England and the Method of Raising Taxes in the Most Equal Manner, London, 1691, and particularly the statement: "Whereas the Stock of the Kingdom yielding but 15 Millions of proceeds, is worth 250 Millions; then the People who yield 25, are worth 4162/3 Millions."—463
[88] Bandes Noires — special mounted detachments which appeared in the fourteenth century at European courts and fought under black banners. In the nineteenth century this name was applied in France to the associations of profiteers who bought up large estates and resold them in smaller plots because the demand and price for them were higher.—797
[45] Engels is referring to the great swindle connected with the bribery of French statesmen, officials and the press by the Panama Canal joint-stock company, founded in France on the initiative of Ferdinand de Lesseps, an engineer and businessman, in 1879. The Company went bankrupt at the end of 1888. This caused widescale ruin among small shareholders and numerous bankruptcies.—437
[46] Here Marx has in mind bourgeois political economists, primarily Adam Smith, who regarded money circulating in the form of gold and silver as the most indifferent and useless form of capital.—461