This brings us to the second sense in which property is social. There is a social element in value and a social element in production. In modern industry there is very little that the individual can do by his unaided efforts. Labour is minutely divided; and in proportion as it is divided it is forced to be cooperative. Men produce goods to sell, and the rate of exchange, that is, price, is fixed by relations of demand and supply the rates of which are determined by complex social forces. In the methods of production every man makes use, to the best of his ability, of the whole available means of civilization, of the machinery which the brains of other men have devised, of the human apparatus which is the gift of acquired civilization. Society thus provides conditions or opportunities of which one man will make much better use than another, and the use to which they are put is the individual or personal element in production which is the basis of the personal claim to reward. To maintain and stimulate this personal effort is a necessity of good economic organization, and without asking here whether any particular conception of Socialism would or would not meet this need we may lay down with confidence that no form of Socialism which should ignore it could possibly enjoy enduring success. On the other hand, an individualism which ignores the social factor in wealth will deplete the national resources, deprive the community of its just share in the fruits of industry and so result in a one-sided and inequitable distribution of wealth. Economic justice is to render what is due not only to each individual but to each function, social or personal, that is engaged in the performance of useful service, and this due is measured by the amount necessary to stimulate and maintain the efficient exercise of that useful function. This equation between function and sustenance is the true meaning of economic equality.
Now to apply this principle to the adjustment of the claims of the community on the one hand and the producers or inheritors of wealth on the other would involve a discrimination of the factors of production which is not easy to make in all instances. If we take the case of urban land, referred to above, the distinction is tolerably clear. The value of a site in London is something due essentially to London, not to the landlord. More accurately a part of it is due to London, a part to the British empire, a part, perhaps we should say, to Western civilization. But while it would be impossible to disentangle these subsidiary factors, the main point that the entire increment of value is due to one social factor or another is sufficiently clear, and this explains why Liberal opinion has fastened on the conception of site value as being by right communal and not personal property. The monopoly value of licensed premises, which is the direct creation of laws passed for the control of the liquor traffic, is another case in point. The difficulty which society finds in dealing with these cases is that it has allowed these sources of wealth to pass out of its hands, and that property of these kinds has freely passed from one man to another in the market, in the belief that it stood and would stand on the same basis in law as any other. Hence, it is not possible for society to insist on the whole of its claim. It could only resume its full rights at the cost of great hardship to individuals and a shock to the industrial system. What it can do is to shift taxation step by step from the wealth due to individual enterprise to the wealth that depends on its own collective progress, thus by degrees regaining the ownership of the fruits of its own collective work.
Much more difficult in principle is the question of the more general elements of social value which run through production as a whole. We are dealing here with factors so intricately interwoven in their operation that they can only be separated by an indirect process. What this process would be we may best understand by imagining for a moment a thoroughgoing centralized organization of the industrial system endeavouring to carry out the principles of remuneration outlined above. The central authority which we imagine as endowed with such wisdom and justice as to find for every man his right place and to assign to every man his due reward would, if our argument is sound, find it necessary to assign to each producer, whether working with hand or brain, whether directing a department of industry or serving under direction, such remuneration as would stimulate him to put forth his best efforts and would maintain him in the condition necessary for
