The Natural Economic Order/Part I/Chapter 17

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Part I, Chapter 16 The Natural Economic Order
Part I. Chapter 17. First general outline of the Law of Wages
written by Silvio Gesell, translated by Philip Pye
Part II, Chapter 1
1929.



The products that remain after deduction of rent and capital-interest, form the wage-fund to be shared among all workers (day-labourers, clergymen, merchants, physicians, servants, kings, craftsmen, artists). When everyone is free to choose his trade, the division is made according to the personal capacity of each, by demand and supply. If choice of occupation were completely free (it is not, but might be) everyone would actually obtain the "largest" share in the distribution. For everyone tries to obtain the largest share, and the size of the share is determined by demand and supply or, ultimately, by the choice of occupation.

Thus the relative amount of the wage depends on the choice of occupation, that is, on the individual. The absolute amount of the wage on the contrary, is quite independent of the individual, and is determined by the amount of the wage-fund. The larger the contributions of the individual workers to the wage-fund, the larger will be the share for each. The number of workers is irrelevant; if there are more workers, the absolute size of the wage-fund grows, but the number of those entitled to a share grows likewise.

We now know the amount contributed by the different categories of workers to the wage-fund:

1. The contribution of agricultural workers is equal to the sum of products which an equal number of agricultural workers could grow on freeland - less freight, interest and import-duties, which we have to conceive as being reckoned in produce.

2. The contribution of other producers of raw materials is equal to the sum of products which they could bring to market from the poorest, remotest, and therefore ownerless sources - less interest.

3. The contribution of industrial workers, merchants, physicians, artists, is equal to the sum of products which they could produce without the advantages of mutuality and organisation, and isolated from populous centres - less interest.

If we pool all these products and distribute them according to the present-day wage-scale, everyone gets exactly the products which he can actually procure in the shops and markets with his present wages.

The difference between this amount and the total produce of the aggregate work performed goes to make up rent and capital-interest.

What, then, can the workers (always in the broadest sense of the term) do to enlarge the wage-fund, to obtain a real all-round increase of wages, which cannot be neutralised by an increase in the cost of living ?

The answer is simple: they must keep closer watch on their wage-fund; they must protect it from parasites. The workers must defend their wage-fund as bees and marmots defend theirs. The whole product of labour, with no deduction for rent and interest, must go into the wage-fund and be distributed to the last crumb among its creators. And this can be achieved by two reforms which we have named "Free-Land" and "Free-Money".