items of income no such corresponding division is made. The largest item in the national inventory is the value of the houses. This is obtained by simply capitalising the return of rental under Schedule A in the income-tax returns at fifteen years' purchase, by which a gross value of nearly £2,000 millions is obtained. But it is perfectly plain that houses would not yield a return of between 6 and 7 per cent. unless a certain portion were actually earned by the constant expenditure of labour. Similarly so regards the income from lands, farming capital, railways, waterworks, and all kinds of companies, a division ought to be made in the same way as in the income derived from trades and professions. The value of the dead capital would in this way suffer a corresponding diminution.
Some idea of the importance of this point may be obtained from considering the aggregate figures of incomes (paying income tax) and the corresponding capital—the former, taking Mr. Giffen's figures, being (roughly) £429 millions, and the latter £7,620 millions. This gives the average of years' purchase as 18, or, in other words, the yield to the capital is about 5½ per cent.
Now it is plain that if the pure rate of interest, as indicated by railway debentures and corporation stocks, is only about 3 per cent., this extra return to capital must be considered as mainly due to the labour involved in maintaining and employing the capital. The element of risk when the question is considered from the national point of view is obviously of comparatively small importance.
Passing now from the capital owned by those paying income tax to the other principal items in the national inventory, the first in importance is the 'movable property not yielding income, e.g., furniture in houses, works of art, &c.' This valuation is made by simply taking half the value of the houses, and reaches the round figure of £1,000 millions or thereby. For the purpose in hand it is only necessary to observe that even to make a proper use of this movable property involves a large amount of labour, which is unrepresented in the wage-earning or profit-earning classes. The musical and artistic skill, for example, 'fixed and embodied' in young ladies should be included in an estimate of living capital, just as much as their pianos and paint-boxes are included in the dead capital. It is plain that the value of the greater part of movable property would vanish but for the acquired abilities of the inhabitants. A simple example will make this point clear. The more widely spread the love of art of the highest kind so much greater will be the value of old pictures. In the ancient world,
