Municipal Socialists rather rely on force than on justice in dealing with private business men. "For private traders to fight against municipalisation is a short-sighted policy. One thing is certain--they have to go. 'What! Compete with us with the ratepayers' money? Our own money? What injustice!' says the small trader."[675] This just objection of the ratepayers is answered with a contemptible quibble. "The small trader is mistaken. The municipality does not use their money, and would not use their money, under the supposed circumstances. If the London County Council decided to open 1,000 bread-shops, how would they raise the capital required? Not by taking the ratepayers' money, or the private traders' money, but by going into the money market and borrowing on the credit of all the citizens. Suppose _100,000l._ were required? Not a penny would come out of the rates. The credit of all the citizens of London is so good that they can borrow all the money they want without any difficulty."[676] In other words, the Social-"Democratic" politician claims for himself the right of arbitrarily depriving citizens who possess property of that property and to ruin them by underselling them. They borrow the money they require for these undertakings on the credit of the very property-owners whom they wish to ruin, not on the credit of "all the citizens," as Mr. Suthers pretends, and then they have the impudence to assert that the corporations do not ruin the citizens with their own money but only with money borrowed on their credit--as if the one were not identical with the other.
The objections to municipal enterprise on a Socialist basis are twofold:
(1) That it increases the rates and the municipal debt, and therefore the rent of houses and lodgings;
(2) That it is, on the whole, unprofitable, being undertaken without due regard to sound finance, efficiency, and economy.
Socialists intend to "tax the rich out of existence." Therefore they endeavour to increase as much as possible not only the Imperial taxation but also the rates. Owners of house property are used to a certain income. If the rates are put up, they put up the rent. Therefore every increase in the rates leads, as a rule, automatically to an equivalent increase in the rent. The fact that a rise in the rates leads to a rise in the rent of houses and lodgings, and that the Socialist policy of waste and squander falls therefore most heavily not on the capitalist but on the working man, is boldly denied. "Generally speaking, the reduction of rates is of no benefit whatever to the working class. Rates are levied upon property.--Q. Do not the working class pay the rates and taxes? A. No. Rates and taxes are paid out of the surplus value taken from the workers by their exploiters. As already explained, the return to the workers, their wages, is determined by their cost of subsistence, regulated by competition in the labour market; consequently they have nothing wherewith to pay taxes, and whether these be high or low, or whoever has to pay them directly, the position of the worker remains the same. He gets, on the average, his subsistence, that is all."[677]