Bush notes that “within Spanish America, large numbers of slaves worked for wages, the result of the common practice of hiring out slave labor, the wages earned being shared between master and slave.” (Servitude in Modern Times, 79)

Again, “another escape lay in the capability of slaves to pay the manumission price — the result of being able to earn money on their own account, thanks to the practice of hiring them out for wages, and because of the high proportion of slaves who were skilled craftsmen.” (80)

But this is just another way of saying that such slaves were not slaves at all; instead, they were feudal tax-serfs! The spectacular advantage of this arrangement to the master was that he no longer needed to worry that the slave would conceal his talents, feign stupidity, malinger, or perform only the absolute minimum required. How much better to let the (former) slave take full control of his own advancement and simply tax his wages! The master would earn more money, if technology and even economy had progressed so far that free labor was then inherently more productive than slave labor.

Mises put it this way:

The slave has no interest in exerting himself fully. He works only as much and as zealously as is necessary to escape the punishment attaching to failure to perform the minimum.

The free worker, on the other hand, knows that the more his labor accomplishes, the more he will be paid. He exerts himself to the full in order to raise his income.

One has only to compare the demands placed on the worker by the tending of a modern tractor with the relatively small expenditure of intelligence, strength, and industry that just two generations ago was deemed sufficient for the enthralled ploughmen of Russia.

Only free labor can accomplish what must be demanded of the modern industrial worker.

At some point the serf might accumulate enough wealth to be able to pay a lump sum for his freedom. The lord would be careful to calculate the expected discounted sum of his tax revenues from the serf over the latter’s lifetime and set the price of full freedom to that. The serf, on the other hand, might have secret entrepreneurial plans to improve his productivity in the future so that his actual earnings would be higher than the lord believes, which would make paying the entire tax in advance worthwhile.

To be sure, both slavery and tax-serfdom are exploitative and unjust. The Spanish code for the regulation of slavery in Siete Partidas originally issued in 1263 proclaimed slavery to be “the most evil and the most despicable thing which can be found among men,” says Bush.

Nevertheless, slavery in the most general sense was a legitimate economic “stage” in the progress of the world. It disappeared when it became apparent how much it retarded development:

If mankind had adhered to the practice of keeping the whole or even a part of the labor force in bondage, the magnificent economic developments of the last hundred and fifty years would not have been possible. We would have no railroads, no automobiles, no airplanes, no steamships, no electric light and power, no chemical industry, just as the ancient Greeks and Romans, with all their genius, were without these things. (Liberalism, 21-22)

The modern welfare-warfare state that eats a great chunk of each (supposedly free) citizen’s income and spends it horribly badly was a huge economic and social retrogression from capitalism back to feudal tax-serfdom. And unlike old-time serfs, we can’t even pay the government off for our or our children’s freedom.


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