ECONOMIC FREEDOM

       We have passed the centennial of the full appropriation of land by government and private individuals in the United States. Over 100 years ago, the Census Bureau proclaimed that either private individuals or government owned all lands in the United States; the frontier was closed. The growth and prosperity this nation has enjoyed is not ordinarily considered in the context of land being available for those who wished to work for several hundred years up until 1896. 

Laws that govern private ownership of land could not be enforced until the population settling North America increased. Land was available at little or no cost providing the choice for everyone to be self-employed or to work for someone else. When this choice existed, there were no signs of poverty. The prosperity we have enjoyed is due to abundant civil and economic freedoms unparalleled in recent history. The nation's wealth is becoming ever more concentrated as we move further from a time when land was available.

            The economist Henry George, one-time candidate for Mayor of New York City in 1886, spoke out against our system of taxation that made it easy for land to be held out of use. He witnessed the changes at the pivotal point in time when land was fully appropriated and emphasized humanity in economics. Over 100 years before Henry George, Adam Smith rebuked landlords for placing claims on labor when land was appropriated.        

                            "As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed, and demand a rent even for its natural produce. The wood of the forest, the grass of the field, and all the natural fruits of the earth, which, when land was in common, cost the labourer only the trouble of gathering them, come, even to him, to have an additional price fixed upon them. He must then pay for the license to gather them; and must give up to the landlord a portion of what his labour either collects or produces."

We have since forgotten the hope and promise that available land provided. Modern economics has become a statistical study with little or no discussion of humanity's place in the universe. It is inherent in the study of the social sciences that humanity be a part of that study.

               We are some 100 years away from a unique period in history when the frontier seemed boundless. Although tainted by the displacement of the native population, the birth and development of this nation exemplifies a time when society prospered by the freedoms afforded its citizens under one government.

        The early laws of the land were greatly influenced by an English heritage. They provided incomparable civil freedoms. Along with this heritage came the inevitable result that in time all land would fall into private hands with a small percentage of it put into productive use. The nation's economic system, also resembling England's, could not immediately emulate all the conditions carried across the ocean by the settlers. Several things stood in the way. 

In post-colonial United States businesses had great difficulty expanding since employees did not exist. People worked for themselves when land was readily available. The maximum wage law was enacted, as one of the first labor laws in our young nation, placing limits on the amount freelance workers could demand for their services. Otherwise, businesses could not grow beyond cottage industries. Companies paid the expensive cost for passage from Europe to the United States if someone worked as an indentured servant for a fixed period. As soon as the contract period ended, the immigrants went to work for themselves. The short-term remedy in some parts of the country was slavery.

               Inconsistent with the civil freedoms on which the nation was founded, slavery served as a stopgap measure to meet the economic need created by the ideas brought over from the "Old World." For the laws in the Old World permitted men to own more land than they could possibly work upon themselves. This requires the labor of men who do not have land to work for themselves. With the abundance of land in the "New World" and the dearth of population, slaves were required if men were to take more than they needed and to benefit from the work of others. Otherwise, the entire economic system and the laws that supported it would not work.

               In time, the population expanded both internally and with the arrival of newcomers. Slavery was not an economic necessity. Men had to travel great distances to reach unclaimed land. Employees were on the rise. The landless class would soon appear in great numbers and in time would have replaced the economic need for slaves.

               Land was not always owned in the history of the world. There are periods in history when land was held in trust for the people by a monarch. With war debts to pay, the monarchs used the appropriation of land and its issuance to pay their debts.

               Plato describes in the Republic how aristocracies become democracies, dictatorships, and anarchy. These changes occur as the aristocracies exist only in name, but in form they already assume the characteristics of the descendant form of government. Plato aptly described this succession of governments and we can see historically a similar progression. The original monarchs held their position as an intermediary between God and the people and by virtue of their regard for the public trusts. Self-serving masters replaced them and soon the natural turn of events led to forms of government we are familiar with today. Once land ownership was accepted, it was only a matter of time before the world economies adopted this system. The focus narrowed and soon led to the economic systems in existence today.

               Our economic system protects private ownership of land for individuals, corporations, and government. The great advantage this provides is security of tenure. The great disadvantage is the laws of the land allow unlimited quantities of land to be owned and held out of use without a significant price to pay.  If answers to economic problems are sought without considering the effects of the system of land tenure, root causes will not be discovered. We need to look at the laws that allow land to be held out of use and the effect this has on production.

               Economics defines the relations between men in society in the civil sphere and the distribution of wealth in the nation.  In the United States we hold dear the belief that there is unlimited opportunity for everyone, a frontier ideology. It is the believed that we can turn the corner and the abundance flows. What is not acknowledged is that someone already owns the corner and will charge a premium for its use. The "American Dream," what is it? To own a home, raise a family, buy new cars, live comfortably; is this the dream? How many today fit this description of the dream? How many want it at all? How many have it and are not satisfied?

               Does not the American dream contain elements of working less and receiving more for it? Could it not mean that for some to work less and receive more, others would have to work more and receive less? If men do not contribute to the nation by working, then where do their food, clothing, shelter, and luxuries come from? Socialist programs such as welfare, food stamps, social security, Medicaid, ameliorate the problems that are created by the poorest segments of the nation not working.

               In the former socialist nations, a scarcity of goods affected everyone. There was limited incentive to work so that the nation can feed itself adequately, clothe itself practically and beautifully, and provide shelter on more than a subsistence level. In other words, merely meeting the necessities of life was a struggle for the nation.  These nations are turning to the entrepreneurial system to pull themselves out of a drab existence.

               Many in the world today are asking questions to discover the causes of poverty. Nations will not find relief from their economic problems by experimenting with theories borrowed from other nations. What is needed is to discover the economic laws that allow all able-bodied men and women to work for themselves, or others if they so choose. We have tasted economic freedom in the development of the American nation. The conditions of readily available land and free men created great riches even if unevenly distributed. The challenge is to replicate the conditions of economic freedom that existed during the development of this nation, without its failings, and to make those opportunities available to all. The need is to lawfully provide and protect economic freedoms as enthusiastically as we have civil freedoms.

              Wealth arises from work on land provided by the universe. Production, the result of work on land, is simply the shaping and reshaping of the earth's elements. When land is only available to select members of humanity then the study of Economics begins by examining how wealth is distributed.  A nation's laws that regulate land tenure will produce economic freedom or servitude for its citizens.

        The North American continent has undergone enormous changes over the past 400 years. The native Indian Civilization was overrun by Western Civilization. The way work is applied to land and the way land is used changed dramatically. It redefined economics on the North American continent. It altered the goods and services produced in the community and redistributed the wealth from work on land by emulating a system based European ideas. We have seen a transition from the Indian nations using as much land as is necessary to support their traditions, customs, and beliefs to the European nations claiming ownership to the land. The European claim to land was supported by law according to their belief system. It was inconceivable to the Europeans, or to the Indians for that matter, that land tenure customs and laws could be any different from their belief systems. Yet, witness the enormous changes that have taken place. 

       A little over 100 years ago, a unique historical event occurred in the United States and very few took notice. Land available to whosoever desired to work on it was fully appropriated and most of it held out of use. England went through a similar transition that culminated in the enclosure of all lands by the beginning of the 17th century. Before the appropriation of land, the principle was that the land belonged to the community. The folk laws supported this principle. Just as the Europeans conquered the North American continent, the Norman invasion of England brought the idea that the land belonged to the King and not the people. Early in the 13th century, the Lords viewed land as a means to pay off debts. To do so they had to usurp common law and replace it with statute law. For example, the statute of Merton in 1236 allowed the Lords to make the transition from what was originally commonly held land, then land held by the King, to private ownership. Laws that affected land tenure in England were simultaneously adopted on the European continent. Thus, upon arrival in North America, the Europeans emulated a system of land tenure that closely resembled what they had at home.  

Labor will be viewed differently if land is readily available or if in the hands of a few whom control access to it. Lloyd G. Reynolds states in Labor Economics and Labor Relations:

                             "Labor is always and everywhere the largest factor of production; and labor income always constitutes a large part of national income. Historically, this income has taken a variety of forms. In economies permitting slavery, it is mainly the subsistence of the slaves and their dependents. To the isolated peasant of Nepal, it is whatever he can produce and consume on his plot of land. Where the peasant markets part of his output, it is cash income plus his subsistence production.

                             Strictly, only part of the peasant's income can be regarded as labor income. Part of it is a return on his ownership of buildings and equipment, and part may be a rent arising from superior quality of his land. However, where landowner, capitalist, and worker are rolled into one, these distinctions may not seem important.

                             Labor income becomes separable and measurable when the worker is hired for a wage or salary. His contribution to production then consists of his physical or mental effort, and the price of this effort is his wage. Modern labor economics focuses on economies in which a large part of the population consists of employees and analyzes major dimensions of the employment relation. The number of people who will offer themselves for employment, the number of hours they will work per week and per year, the deployment of the labor force among the many specialized occupations in the economy, the determination of wage rates and other terms of employment for each occupation, and the distribution of total national income between employees and others. It is concerned also with the special institutions that have grown up around the employment relation, notably trade unionism and collective bargaining, and with the degree to which these institutions modify the supply and compensation of labor. Labor economics is not confined, however, to workers who happen to be organized or to the lower occupational strata of the population. It is concerned with all labor effort, with employees at every occupational level, including the effort exerted by employers and self-employed persons."

              In Reynolds' description of labor economics, we can hear deference to the classical economists by attributing the proceeds of production to capital, quality of land, and that portion solely due to labor. The important distinction being made needs to be understood if one is to appreciate how wealth arises. We will not examine wealth, for the moment, for our focus is on labor and the effect of land tenure.

        Defining labor by employer and employee is a relatively new development. This distinction appeared with the full appropriation of land and the development of the entrepreneurial system. Before the contemporary view of labor evolved, a hierarchy consisted of master workmen, journeymen and apprentices. The master workman is a person very skilled and able in some work, profession, science, etc., specifically a skilled workman or craftsman qualified to follow his trade independently. The journeyman is a mechanic or workman who had served his apprenticeship and thus qualified himself to work at his trade but not recognized as a master. An apprentice is a person under legal agreement to work a specified time for a master craftsman in a craft or trade in return for instruction and support.

              Labor relations changed as the system of land tenure increasingly had its effect on the economy. It is difficult to see the impact of the land tenure system on labor under present conditions. However, we can discover how labor is affected by land tenure by examining the transition that took place in colonial America.

              Labor in the colonies was at a premium, for who would work for someone else when they could work for themselves? What allowed individuals the choice to work for themselves was the availability of affordable land. Labor was so scarce in colonial America and land was so abundant that under the "head-right" system if you paid the passage of a newcomer, you received 50 acres of land in return.

              Foster Rhea Dulles describes Colonial America in the book Labor in America. Labor is described as follows:

                             "The principal sources of labor in colonial America were indentured servants and slaves. Free workers were a small minority in the seventeenth and eighteenth centuries. As the little towns scattered along the Atlantic seaboard gradually grew and prospered, however, mechanics and artisans who had either come directly from the Old World or arisen out of the ranks of bound labor to build their own lives in freedom became of increasing importance. There were carpenters and masons; shipwrights and sailmakers; tanners, weavers, shoemakers and tailors, smiths, coopers, glaziers, printers.

                             The skilled craftsmen among these workers at first plied their trades independently, but as the centers of population grew, master workmen set up small retail shops and employed journeymen and apprentices to work for them for wages. By the close of the eighteenth century, these journeymen were beginning to form local trade societies -- the genesis of the first unions and of what was to become in time the organized labor movement."

        The colonies’ population grew and the need for services to support agriculture and the burgeoning towns and villages expanded with this growth. We are accustomed to living in a society in which there is a constant pool of unemployed that varies according to trade conditions. It is difficult to envision conditions in which labor is continuously in demand beyond the capacity to fill the need. The demand for labor was due to readily available land and a seemingly endless need for goods and services. Most settlers were self-employed due to the low risk to start an enterprise. Given the conditions settlers left behind in Europe, the labor situation was viewed as a problem for those who established themselves early on. Foster Rhea Dulles describes the solution as follows:

                             "The ways in which the labor problem was met varied greatly in different parts of America. The circumstances of early settlement and natural environment led New England to rely largely on free workers. The south was ultimately to fall back almost wholly on Negro slaves. In many colonies during the seventeenth century, and continuing through the eighteenth in the middle colonies, the bulk of the labor force was recruited from indentured servants. It has been estimated, indeed, that at least half, and probably more, of all the colonists who came to the New World arrived under some form of indenture and took their place as wholly free citizens only after working out their terms of contract.

                             There were three sources for such bound labor: men, women and children whose articles of indenture were signed before leaving the Old World; the redemptioners, or so-called free-willers, who agreed to reimburse their passage money by selling their labor after landing in the colonies, and convicts sentenced to transportation to America. Once in the colonies, these various groups coalesced into the general class of bound servants, working without wages and wholly under their masters' control for a set term of years.

                             So great was the demand for labor that a brisk trade developed in recruiting workers. Agents of the colonial planter and of British merchants scoured the countryside and towns of England, and somewhat later made their way to the continent, especially the war devastated areas of the Rhineland, to cry abroad the advantages of emigrating to America. They distributed handbills at Country Fairs extravagantly describing the wonders of this new land where food was said to drop into the mouths of the fortunate inhabitants and every man had the opportunity to own his own land. The promises held forth were often so glowing and enthusiastic that the ignorant and the credulous gladly signed articles of indenture with little realization of the possible hardships of the life upon which they were entering. The 'crimps' who worked the English countryside, and so-called 'newlanders' operating on the continent, did not hesitate at fraud and chicanery."

              Europeans without land and without work were convinced that in America there was gold in the streets, all one had to do is to learn how to pick it up. For some, this proved to be true for the gold they sought was the freedom of opportunity provided by available land. In Europe with lands appropriated, the homeless and unemployed were forced to beg for existence. Given the opportunity to work, these disenfranchised citizens became the economic foundation of America. What made the difference? The availability of land transformed the servants of Europe into the self-employed of America. Listen again, to how conditions are described in Labor in America:

                             "Free labor in the colonies was made up of immigrant artisans and mechanics who had been able to pay their own passage money and of recruits from the ranks of bound servants who had served out their terms of indenture. The available supply of such workers nevertheless remained highly limited and the towns along the Atlantic seaboard continually suffered from an acute labor shortage. Even this early, high wages and relatively favorable working conditions could not stop the steady migration westward. The frontier with its cheap land constantly drained the seaboard.

                             'The genius of the people in a country where everyone can have land to work upon', a colonial official reported to the Board of Trade in 1767, 'leads them so naturally into Agriculture, that it prevails over every other occupation. There can be no stronger instance of this, than in the servants imported from Europe of different trades; as soon as the Time stipulated in their Indentures is expired, they immediately quit their Masters, and get a small tract of land, in settling which for the first three or four years they lead miserable lives, and in the most abject Poverty; but all this is patiently borne and submitted to with the greatest cheerfulness, the satisfaction of being land holders smoothes over every difficulty, and makes them prefer this manner of living to that comfortable subsistence which they could procure for themselves and their families by working at the Trades in which they were brought up.'

                             This situation bore most heavily upon New England, where relatively few indentured servants were available, and led to such high wage rates and such an independent attitude on the part of both skilled and unskilled workers that the colonial authorities felt compelled to act. The result was the first labor legislation in America affecting free workers. Maximum wages were established by law, changes in occupation prohibited, and various class distinctions in dress and deportment prescribed to keep the lower classes in a subordinate role."

        Although conditions were ideal for the worker who was self-employed, it was problematic if the needs of an enterprise exceeded the amount of labor available. The creative genius of the nation was at a crossroads.  The economic system could continue to develop as it did in Europe or the perceived problem could evolve into something new. The seeds for what was to come had already been planted. The laws of the land permitted citizens to own land to sustain themselves, but also to claim ownership to large tracts of land to hold out of use. The reason many traveled west, even though there was productive land nearer to established communities, is a landlord's claim would have to be paid, credit would be needed, and the enterprise would have been riskier given these added expenses. There were (and still are) minimal disincentives to hold land out of use but great financial consequences in so doing. It was not as if the leaders of the new nation did not see what was coming. They considered limiting the growth and development of the nation to keep its riches available only to those who possessed land. Again, let us listen to Foster Rhea Dulles:

                             "Whatever their contribution to the movement for independence and the establishment of the United States, the workers did not win any substantial gains during these years. It is not necessary to quote the conservative views of such a strong advocate of government by the rich and the wellborn as Alexander Hamilton to demonstrate how far removed the United States was from a democratic society at the close of the eighteenth century. There were everywhere fears of the 'leveling spirit' which had seemed so pronounced during the Revolution, and of the threat to national stability in any further concessions to the democratic masses.

                            Even Thomas Jefferson, stoutly declaring that 'the influence over the government must be shared by all the people,' had no idea of including the property less workers within the scope of those to be granted the franchise and allowed to hold public office. The democracy which he supported was a democracy of small freehold farmers and he gravely doubted whether artisans, mechanics, and laborers, without the stabilizing influence of being land owners, could ever develop the republican virtues which he felt essential for the functioning of a free society.

                             He strongly opposed the development of manufactures in the United States. He was afraid of the influence of an increasing number of urban workers. He would have had our workshops remain in Europe rather than risk the creation of a wage-earning class whose principles and manners he held in suspect. 'The mobs of great cities,' Jefferson wrote in fearful contemplation of what he felt was happening in Europe, 'add just so much to the support of pure government, as sores do to the strength of the human body.'"

              The revolution of 1776 was one of home rule. The laws of the land did not substantially change. The names of the leaders changed but they embraced common law and built statute law on this foundation. The laws determining the way land was to be held would set the stage for the economic development of the nation.

        The view that obtaining labor was a problem in the colonies is associated with the idea that one should be able to profit from the labor of others. The response to the "labor problem" was involuntary servitude that restricted the civil liberties of men, or economic servitude severely hampering or eliminating the choice for self-employment.

              The laws that allowed land to be held out of use could only extend as far as the military can enforce it. How can laws be enforced hundreds of miles into the wilderness where two Civilizations met on the vanguard of change? Before the revolutionary changes in the economic development of the nation could reach across the frontier, the population would have to increase to populate the frontier. The balance shifted when those who believed that as much land could be claimed--could be owned to the exclusion of others--enforced their will on the nation. Once the means for enforcement was established, then the effect upon labor was pronounced. Available land became scarce and self-employment as an alternative was subject to increased pressures in the form of additional claims.

        Security of land tenure does not create economic difficulties. Security of tenure is an essential component of production, a prerequisite to the investment of labor and capital into production. The problems arose when the desire to take as much as one can for oneself without concern for what anyone else gets is legally sanctioned. The laws of the nation enabled people to hold land out of use from those in need of work. This leads to inequities in the distribution of wealth resulting in unemployment, poverty, ignorance, crime, and the rise of the entrepreneurial system.

        Claims on land expanded further west, in the United States, and the option to be a self-employed farmer diminished. The European immigrants continued to arrive with the hope of land ownership. What they found, to reach land available they would have to make a long, arduous journey across the continent. Even the preparation and cost for such a journey was beyond their means.

               Stories of a "pot of gold at the end of the rainbow" abounded. All too often, the story ended in finding that land was not available and resorting to work for someone. One such story, figuratively symbolic of this period, was during the gold rush in Canada. To cross over the Canadian border, one had to bring 2,000 pounds of provisions. People traveled hundreds of miles to stake a claim. They prepared 40 packs of 50 pounds each and carried them one at a time for three or four miles. When all 40 packs were brought forward, they continued their journey for 3-4 miles repeating this process. At one place in the trail, up a steep incline called the "golden stairs," one had to wait in line several hours to get a turn to move forward. It took 6 hours to ascend the stairs. Thus, it took 40 days to reach the top with all the provisions. If rest were needed, the traveler would lose his place in line and would have to wait to regain a position to move forward. Upon arrival at the gold mines, most would-be prospectors found that there were no more sites worth working. Either they stayed to work for a wage for those who had staked a claim, or they returned home with no more than the memories of the experience. The "stampeders," as they were called, were highly respected for their efforts.

               The "gold" that was most sought after in the United States was a piece of land to call one's own. Once most land in the United States was claimed and was in production or held out of use, the choices available to those who sought work changed substantially. One could still obtain a site by paying a landlord his claim. For many, paying the landlord's claim still left enough over to make a go of it. Another alternative was to work for someone who had established a business. As the expense and risk of starting a business increased, the number of individuals forced to work for others grew proportionally. The entrepreneur arose out of the conditions that effected land and labor. The entrepreneur discovered the advantage to obtaining a prime site which would entail paying a landlord's claim, equipping that site with the finest tools available, and employing the best available labor. The result was that production would increase compared to what would be earned on that site as a self-employed farmer or the sole proprietor of a business.

               The entrepreneur was able to organize a business since claims on land caused significant numbers of able-bodied workers to seek work who otherwise would be self-employed. The competition for work put downward pressure on wages so that the earlier "maximum wage" law became moot. The "American Dream" was becoming just that for many citizens, no more than a dream with little hope for fulfillment. Conditions were ripe for the entrepreneur to respond to the economic needs in the moment. These conditions were as follows. Firstly, a high regard for civil liberties in the nation that permitted freedom of movement and information for most citizens essential to the workings of a business. Land held out of use, creating a pool of unemployed labor being sufficiently high to keep wages low, and the availability of credit to obtain the capital necessary to organize and begin a business. The reward for the entrepreneur for his efforts was what was left after all claims were met, otherwise known as profit. The prerequisites for the entrepreneur to succeed are as true today as they were then.

               With the birth of the entrepreneurial system, labor relations changed dramatically. Listen to a description given by Lloyd G. Reynolds in Labor Economics and Labor Relations:

                               "3. The dependent status of employees. From one standpoint, the shift from self-employed farmer or artisan to employed wage earner liberates the individual. He is free to move about in search of work, to better himself, to work his way up the occupational ladder. But in other ways it reduces his independence. The wage earner must find work in order to live, while the farmer can always live after a fashion from his own output; and when the wage earner is employed the details of his work are closely regulated. Someone else specifies the times at which work is to be done, the nature of the task, the materials and equipment to be used, the pace of work, and the expected quantity and quality of output. Above the worker stand all the layers of management, from first-line supervisor to company president.

                4. Administration and the web of rules. Dependence does not stop with the worker. The supervisor is himself under higher authority, and so are the general foreman, the plant superintendent, and the vice-president in charge of production. Even the company president is responsible to a board of directors. A large enterprise is bound together by an elaborate hierarchy of authority, which specifies the powers and responsibilities of everyone from company president to laborer.

                               It is bound also by a network of rules governing output and cost targets; products, equipment and production methods; types and amounts of compensation; employment, promotion, discharge, and many other things. At a particular time most of these rules are taken as fixed, and changes are occurring only at the margin; so one is apt not to realize their extent and complexity. But reading a fifty-page union contract reminds one how complicated the internal government of a large business can be. When we say that the industrial worker must learn discipline, we mean that he must know and observe this web of rules, in addition to submitting to the personal authority of the supervisor."

               Changes in labor relations led to unrest and dissatisfaction. Instead of self-employed being the norm and labor unavailable at any price, there was now downward pressure on wages causing labor to organize to have a voice in their own affairs. It was by law that men and women could claim land and hold it out of use to the exclusion of those who could work on it. It was, and is, the judiciary and legislative branches of government that must address the problems created by land held out of use; mass unemployment, poor conditions in the work place, and wages pushed to subsistence levels. Thus, the tangled web we find ourselves in today. It has always been a delicate balance between a laissez-faire economy and interference in private enterprise to ameliorate the problems created by appropriated land held out of use and subsequent unemployment. The remedies ignore the source of the problem and what we are left with is layer upon layer of legislation attempting to soften the effects of the appropriation of productive land held out of use. Each new piece of legislation replaces the problem at hand with a new set of difficulties that is often worse than the original situation. The result is we grow deeper in debt, we have fewer citizens working, crime and social problems worsen, and the maze of legislative programs multiplies. It is the laws of the nation that has created these conditions, and it is through law that changes must take place. When one gets lost in the forest, the way out is not to burn the forest down; this can only lead to self-destruction. The way out of the forest is to retrace our steps. An understanding of the causes of economic and social problems is required and not merely the symptoms. To understand how law effects the community may clear the way back to a simpler, finer condition. Let us listen to Lloyd G. Reynolds' account of the judiciary's effect on labor:

                               "A review of the turning points in American labor policy begins with a long period of a century or more when the power of the judiciary was unchallenged. Trade unions have been subject to comprehensive government control through the courts from the very beginnings of union organization.

                               There are two main types of legal rule: statutory rules enacted by the legislature, and common law rules, which are unwritten and are based on consistent lines of previous court decisions. The courts have the final word in administering both types of rules. Statutory law is applied first by administrative agencies, such as the National Labor Relations Board, but decisions of the board can be appealed by the losing party to the lower courts and eventually to the Supreme Court. Thus, the practical effect of a law is tested in a series of hearings, first administrative and then judicial, and in the end the judges often decide what the statute means.

                               Common law rules, on the other hand, are rules that have developed solely or primarily through the accumulation of judicial decisions. Instead of interpreting the language of a statute, the court decides a dispute on the basis of a line of precedents, a logical sequence of decisions in previous cases where the court finds elements of similarity. In the absence of statutory law, judicial application of common law principles shaped the growth of unionism for almost a century...” 

Now that we have heard how the process works, let us hear what took place...

                               "The long period of judicial control was repressive and negative in character. Judges for the most part concluded that unionism was an undesirable activity that, if it could not be prevented altogether, should be held within narrow limits. This view was due partly to the nature of law itself and partly to the personal predilections of the judges. Law is necessarily a conservative force. It exists to protect established rights. The common law of Great Britain, carried over in large part into American practice, gives special weight to rights connected with property ownership. Unionism, however, attacks the rights of the owners of industrial enterprises to manage them as they see fit. It seeks to curb property rights in order to establish new rights of workers in their jobs. The common law also regards freedom of contract and freedom of trade as desirable social objectives. The union, however, exists to restrict competition and establish a quasi-monopolistic position for its members. Unionism thus seemed contrary to the spirit of the common law, and it was easy for judges to find rules and precedents that would repress the activities of organized labor.

                               The judges' legal training in common law principles was buttressed by their political preferences. They came mainly from the propertied class, mingled more freely with employers than with workers, and tended naturally to sympathize with the interests of property owners. Their political thinking was influenced also by classical and neoclassical economics, which could find no useful place for joint action by wage earners.

                               But unionism had developed in response to important economic and social needs. Policies that were merely negative could not continue indefinitely. The spread of industrialization required a reduction of labor disputes and an environment of labor peace rather than violence and unrest. Repressive judicial policies left the underlying economic problems unsolved. As the size of the industrial working class increased, a power base was built up for the emerging labor organizations."

               The entrepreneurial system is a response to the set of conditions created by the formation of democratic governments from the ruins of aristocracies and dictatorships, civil liberties extended to many citizens, and security of land tenure. Remove any one of these conditions and you will not find entrepreneurs. The success or failure of any entrepreneur depends on a single factor that is highly dependent on a multitude of factors; the portion left over after all claims have been met, profits. The entrepreneur is in a precarious position since many of the factors that influence profits are beyond his control. Some of the factors are influenced by the following variables:

FACTOR                                              VARIABLE

Wages                                                   Trade Conditions

Credit                                                    Communal Trust

Rent                                                      Competition & Taxation

               Wages will rise in times of good trade and fall in times of bad trade. Credit will be extended by banks, other lending institutions, and individuals according to the level of trust in the community. Credit flows freely when there is confidence in the economy, when shaken credit dries up. The entrepreneur who can instill confidence in his creditors will stay afloat if his word is his bond. Taxation has an inverse relationship to landlord's claim. The landlord will extract as much revenue as competition for a site will permit. The efficient entrepreneur has reduced costs of production, his employees are working for the least they will accept, and he is working for the smallest profit margin acceptable. The landlord will seek to maximize his claim by asking for as much rent as competition allows. When government raises taxes, especially in times of bad trade, the entrepreneur has limited means to meet this increase. The landlord must reduce his claim or financially withstand a vacancy. The landlord may choose to reduce his claim since many entrepreneurs will be under the same pressures during this period and vacancies will be high. The economy eventually shifts, trade picks up, and/or taxes are reduced. The landlord responds by increasing his claim to the most an entrepreneur is willing to pay for the site. This is a simple explanation of the economic cycle.

               The entrepreneurial system is a symptomatic response to the problems created by land appropriated and held out of use. It increases production and generally improves the quality of life in the community. It will not solve the problems created by land being held out of use since it only addresses the symptoms and not the cause of economic hardship. The entrepreneurial system is a fragile one as described by Gardner and Moore in their work Human Relations and Industry:

                               "The entrepreneurial matrix is in a continuous state of flux through time. The activity within the system is in fact generated through its basic imbalance or disequilibrium. It is a structure which is never completely built, where gaps occur which are linked together by entrepreneurial effort only to give rise to new hiatuses which require further rearrangements. Thus, the entrepreneurial matrix moves through time with the entrepreneur striving to meet challenges and solve problems as they arise--always hoping to achieve a more stable, homeostatic balance but inevitably faced with new imbalances and the need for novel adjustment and innovation."

        If we can reason that land being held out of use leads to an economic imbalance effecting the distribution of wealth and relations between men and women, then how do we restore the balance? It can be observed that the entrepreneurial system in its present form, ever tottering, will not achieve a lasting balance. Clearly, a dramatic shift occurred from the period when land was readily available to most of land being held out of use. In the former condition, men and women had the freedom to be self-employed or to work for someone else. In the latter condition, economic freedom no longer exists.  Since there is a correlation between the land held out of use and societal conditions of freedom, then it may prove fruitful to study the laws and system of taxation that supports land use in its present form.

       The difficulties begin when men and women appropriate land, a universal element, and hold it out of use. Conditions have changed over the past 250 years to evolve from an economy that required the enactment of a maximum wage law to one that sets a minimum wage. The laws that effect land tenure, capital, and wages can be in harmony or discord with natural law. We have moved afar from the belief, "the Earth is the Lord's.” When one gets lost in the forest, all the trees begin to look alike. The best way to find the way out of the forest is by retracing one's steps. 

              The settling of America was the continuation of the story that was unfolding in Europe. Land in England was fully appropriated at the end of the 18th century. When the common lands were available, the people had a place to go to support themselves. When the common lands were claimed and held out of use, economic conditions deteriorated rapidly. Poverty, famine, disease, and unemployment were commonplace. Conditions were ripe for change.

              The voyage across the Atlantic Ocean was not an easy one. It was dangerous and uncomfortable. The ships were small, the food was not fresh except for a catch of fish, and accommodations were rugged to say the least. Some who chose to risk the journey, with all the dangers and discomforts, believed that conditions could not be worse than what they were leaving behind. What made matters even more treacherous is once the settlers arrived in America they came upon a wilderness. They had to start from scratch to set-up shelters and hunt for food. Their survival hung by a thin thread and many died. Yet, they came to America to gain access to the one natural resource upon which all life depends, land. The opportunity to have a piece of earth to work on with security of tenure was the driving force to make the journey to America against all odds.

              The economic growth in America for 300 years from the early 1600's to 1900 is due to land being available to whosoever wanted to work on it. It was practically impossible to appropriate more land than one could work. Those who did not want to work for themselves could work for others at a high wage. Economic freedom is defined as the choice to work for one's self or for someone else at any given time. We enjoyed economic freedom. With land fully appropriated in the late nineteenth century the development of the nation slowed dramatically. In the twentieth century, we have seen our economy decline as we mature as a nation with land fully appropriated and most of it held out of use. It is only by advances in productive capabilities that we have been able to sustain growth during this period.

              In the early development of North America, there was full employment. A man walking into a settlement would be welcome for the labor he could provide to the community. If a newcomer did not want to work, he would be driven out of town. 

              Today it is not simply a matter of going to work or leaving the community. For many, the laws of the community have removed the opportunity to work. The community has done so by supporting a system of taxation that allows productive land to be held out of use at little or no expense. It makes it easy to appropriate land and thus create discord with natural law. Carefully executed, the system of taxation can evolve to make land available to the disenfranchised that would lead to a boom in the economy like the early growth of this nation. The assurance of security of tenure allows production to take place. Removing taxation from profits and wages allows growth to take place. Security of tenure is the key to any productive endeavor whether it is through ownership, lease, or governmental guarantees. The system of taxation will make or break economic growth. Establishing laws based on true principles can only lead to prosperity.

              What would happen if land were made available to those who wish to work? If the citizens are not educated in a trade, profession, or farming, what will they do with the land? Even if they are educated to apply some skill to the land and they do not have capital available for tools, what good is the land or the skills? Thus, we have a three-part problem. To find our way out of the economic forest we need to have land readily available, reeducate people to use it, and to provide sources of capital so the work can begin. Simplicity is the hallmark of natural law.