Constructive Suggestions

In behalf of aspiring, capable, worthy tenants in the town and country regions of North Carolina, we offer the following recommendations-not so much for immediate adoption as for popular discussion aimed at changes in the tax laws of the state as rapidly as practical wisdom may dictate. The people of North Carolina cannot erect a stable commonwealth on the landless estate of men, and the sooner we face this fundamental truth the better.

For lack of space we are stating without discussing these recommendations.

First, we recommend constitutional changes that will permit the classi fication of property values and the tax rates thereon; which means the definite abandonment for all purposes of the ancient general property tax. For an excellent discussion of the general property tax see McPherson's chapter in the 1908 volume of the International Tax Association.

Second, the separate listing of real estate and the improvements thereon in both town and country areas; the rates on improvements to be made low enough to encourage and reward industry and enterprise.

Third, definitely low tax rates on homes occupied by the owners and on farms operated by the landlords thereof; definitely higher tax rates on unused or unimproved town lots and farm lands; and still higher rates on such lots and farm lands when owned by residents of other states and countries. Which means, progressive land taxes-beginning with low rates on small properties occupied or used for productive purposes by the owners thereof, followed by rates gradually increasing acording to acreage or value, with higher rates laid on unused, unimproved town lots and farm lands, and with the highest rates laid on such unused property when held by alien landlords.

The progressive land tax has been in force in New Zealand for thirty years. It took a score of years to put it on the law books of that country, and it will take a century or so to make it effective in bringing idle town lots and farm acres into productive use; so difficult is it to choke out of men the purely speculative interest in land ownership.

Such a law will be slow to get on the tax books of any state or country of the western world, and it will be slower still in accomplishing its purpose-namely, to give landless men a chance to own homes to live in and farms to cultivate. But we might as well begin to discuss it now in North Carolina.

Fourth, the taxing of the equities and nothing but the equities of home and farm owners, when the properties are occupied or operated by the owners themselves. As it is now, the owners of five-to-twenty-year mortgages amounting to $3000 or less are exempt from taxation in North Carolina, provided these mortgages cover money loaned to buy homes and call for 5 percent interest or less. If we can exempt the owners of such mortgages, surely we can exempt the owners of such homes from tax on the property covered by these mortgages.

The manifest purpose of these constructive suggestions is to encourage the increase of owned homes, farms, and productive businesses of every type, (1) by minimizing the tax burdens of small homeowners and small farmers and giving them a decent chance to hold their homes and farms, (2) by laying a penalty on the owners of idle lots and farms, (3) by encouraging enterprise with lower rates on real estate improvements and investments, and (4) by penalizing acquisitive capital of the miserly type and rewarding productive capital invested in active enterprises in North Carolina.

Fifth, a State Land Settlement Board, charged (1) with investigating the California plan of establishing farm colonies, and (2) reporting a feasible plan of state-aid to capable farm tenants in North Carolina. With 100,000 vacant city lots, twenty-two million acres of idle farm land, and one million three hundred and eighty thousand landless, homeless people, town and country, it is high time we were considering proposed remedies of any sort whatsoever.

THE EFFECTS OF HOME AND FARM OWNERSHIP

F. A. GRISSETTE, Caldwell County

So far in the club studies of the year, we have been considering Tenancy, Town and Country, (1) the bare facts of its extent and increase since 1880, (2) the areas of excessive farm tenancy-namely the South and the Middle West, (3) tenancy in town and city centers, (4) tenancy in mill and factory centers, (5) tenancy in the United States and in the Old World countries, (6) the causes producing the landless estate of men, (7) the status of the tenant and his standards of living in North Carolina. In other words the club has been digging out the bare facts of farm and home tenancy and outlining the subject as a preface to studies centered upon the ways and means of promoting home and farm ownership. In brief the club has been clearing the ground for a consideration of constructive measures, based (1) on self-help and the personal use of private agencies, (2) on state and federal aid, and (3) on such state-aid remedies in North Carolina as seem possible to the club.

My subject concerns the Effects of Home and Farm Ownership on the one hand and of Home and Farm Tenancy on the other, (1) on personality, (2) on family life, (3) on labor and industry, (4) on community life and enterprise, (5) on the church, and (6) on citizenship and the democratic institutions that depend on citizenship.

The student marked up to make this particular study and to report on it at this session of the club is ill and absent. It is proper to say that I was suddenly called on to serve as a proxy. I have found my subject to be a large order and also that I had a minimum opportunity to treat it adequately or creditably. I have therefore been obliged to hurry through the seminar files of the department of Rural Social Economics, and to rely upon the help of Messrs. Branson and Hobbs in the preparation of this report.

The Meaning of Land Ownership

In the first place I want to say that the meaning of home-ownership in our towns and of farm ownership in our country regions is fundamentally significant. Property-ownership of any sort is significant. It indicates property-owning virtues in a man-(1) industry or the willingness to toil steadily and persistently, (2) thrift or the power of self-denial coupled with prudential foresight, (3) sagacity or the power to think a thing clear through to the end, (4) sobriety or clear-headedness undisturbed by intoxicating liquors, and (5) integrity of character and reputation for truthfulness, honesty, and promptness in discharging obligations to the minute. All these are qualities that build civilization in a man or a nation.

But the possession of landed property is even more significant-so significant that in every land and country history is recorded in terms of land tenures, because the makers of history have been the owners of land. The history of England is the story of land ownership. The status of Germany

today is the status determined by the Junkers, and the foundational fact in Russia and the Balkan States is not sovietism or communism but the breaking up of the great estates and the transfer of land ownership from the few to the many. The early Anglo-Saxons perfectly expressed the significance of land ownership in the proverbs, The land is the man, No land no man, Who owns the land owns the man, The owners of land are the rulers of men, The makers of history are the owners of land, and so on. The man who does not own the house he lives in or the farm he cultivates is (1) either crippled in body or brain by heredity and thus is born an underling, or (2) he lacks the home-owning virtues and cannot develop them, or (3) he is the victim of unforeseen events-illness, death in the family, fire, floods, storms and the like-and cannot recover his grip on himself or his surroundings under modern conditions, or (4) if heredity, personal qualities, and the chances of life be in his favor, he finds it impossible or unwise to acquire land because farm land prices are so high that no profits can be wrung out of farm products, or town-lot prices are so high and building construction so expensive that it is cheaper to rent than to own a home. In any event the landless man runs the risk of being subdued by the conditions that envelop him; of having his nature dyed, like the weaver's hand, by the social medium he lives in and works in. Once resigned to the lot of a tenant under modern conditions, the chances are that he will always be a tenant, and what is worse, that his children, and children's children will be tenants to the remotest generation.

The land owner, and especially the man who acquires landed property by his own industry and sagacity, is apt to be a sturdy, robust, upstanding, self-respecting member of society; he is usually a permanent resident of the community and identified with its fortunes; he has a chance to feel a proprietary interest in community institutions and enterprises; he develops an assurance that he belongs to the class out of which county commissioners, city aldermen, mayors, legislators, congressmen, and governors are chosen; he is apt to have an active interest in law and order and to stand on the right side of moral, industrial and political issues. Home and farm ownership develops a proper self-respect in men, steadies their judgment in business matters, and in moral and political issues, and makes of them a bulwark of defense for the community or the country in which they live. It was the well-nigh universal ownership of homes and farms, businesses and bonds that put iron into the soul of Foch's armies at the front. They were fighting in defense of what was their very own.

On the other hand, what is apt to be true of a community, a commonwealth, or a country where tenancy is the rule and land ownership the exception? In North Carolina, say, where one of every three white farmers, two of every three negro farmers, from two to three of every five city dwellers, and from eight to nine of every ten factory wage-earners live in other people's houses or cultivate other people's land-all told 1,380,000 people, or more than half of our entire population? Or in the United

States, where already fifty-four million people are landless and homelesswhere at least five million of them are houseless, or herded in slum quarters in city centers?

As for farm tenants, their estate in life is well described by Prof. S. H. Hobbs, Jr. Says he: "Farm tenants, because they have no stake in the land, have small chance to develop abiding interest in community life. They are strangers, pilgrims, sojourners in the land. They are usually discontented and forever on the move. And they cannot be blamed for their discontent. They are forever seeking to better their condition by adventuring into new fields. This of course spells disaster for schools, school attendance, school consolidation, and churches in town and country areas alike. It delays the development of good roads. It cripples public health work. It multiplies the problems of law and order. It hinders community organization and community enterprise in behalf of progress and prosperity, welfare and well-being. It spells disaster for coöperative marketing associations. A landless, homeless, wandering tenant population cannot become prosperous coöperative machines. Coöperation is rooted in land ownership, and a farm civilization rooted in short-term tenancy can hardly succeed with coöperative enterprises. In order to succeed a coöperative enterprise must have a stable membership."

A tenant community is usually a poverty-stricken community-especially in territories where cotton and tobacco are grown. Even if tenants make a great deal of money in good years, they rarely ever accumulate property-so, because they have had the very poorest chance to learn even the first principles of economy. They seem to know or to care little about live-at-home farming. They are restless and like Poor Joe they are forever moving on. Three moves are worse than a fire, but farm tenants rarely ever stop to think of it. In a community of excessive tenancy you are sure to find lodges, churches, and social organizations of every sort weak or lacking altogether. In the main where the per cent of farm tenancy is least, we find fraternal organizations most numerous and most actively useful. A rural community in a cotton or tobacco county in North Carolina, where from two-thirds to three fourths of the farmers white and black are croppers, as in Edgecombe or Scotland counties, offers a startling contrast to a rural community in Denmark where more than nine of every ten farmers are land owners. The Danish farmer is a home-owning farmer. He has his legs under his own table, as the phrase goes in Denmark. On an average he belongs to eight different coöperative associations for financing and marketing his crops and buying his farm supplies—a creamery, or a cheese, or a ham and bacon, or a poultry coöperative, a credit union coöperative, various buying coöperatives-coöperatives for every detail of farming. Danish farmers can coöperate because they are land owners, and therefore settled members of the community with capital thriftily accumulated. They can enter into joint business contracts because they are stable members of the community and they can therefore establish stable businesses based on stable community life. As a result nobody is extremely rich or extremely poor in Denmark. The wealth of this farm state