Landlords are responsible for two original costs, the fixed and the variable costs, including the costs of original construction and those of maintenance. A landlord may be the original builder, may contract out to someone else, or may compensate a previous owner, but the landlord bears the original cost of the structure. Similarly, a landlord may do the work him or herself, or may hire a property manager, or pay individual specialists for particular tasks, but bears the original cost of this, before leasing their property.
It is important to understand that the individual I am describing may colloquially be called a landlord, but that the individual in question will not only own and let the land, but also a structure or more upon it. As such, the landlord is also a capitalist, because the structure is not bare land, but a mixture of land and labor, which we know as capital. This being so, one must understand that while we use the term landlord we are doing so in a qualified sense, which we will not always be sticking with, because including also the role of capitalist.
In the landlord’s lease, the landlord asks for a price that is commonly called rent. This, again, needs some qualification, because it also includes the interest on the capital of the “landlord.”
To make this clear, rent is the payment for the use of land to a landlord, interest is the payment for the use of capital of a capitalist, and wages is any payment for doing any kind of work, mental or manual, excepting for profit, a return to labor that overcompensates it. These are the definitions in economics anyway, but you are right to notice this is not the common use, which speaks differently of what we call contract rent, such as the lease money paid to the landlord, contract interest, the payment for a loan, or contract wages, such as the payment made by an employer to an employee, which are real, colloquial uses, but different. We’re taking a scientific look, so we will be using the economic definitions.
Applying this to our future landlord, the contract rent that the landlord will be asking in their lease includes not only payment for the use of the land, the rent, but also payment for the use of the structures, the interest, as well as any labor that is performed by the landlord, his or her wages. In other words:
Before scoring a tenant, the landlord pays for all costs him or herself, the fixed and variable, either by performing the work him or herself or by paying others for it. The costs include the landlord’s labor and the work of others, the wages of the economy. These are included in the expenses, which include those costs as well as surpluses, the profit and interest. Wages, that is, are cost, but profit and interest are surplus, meaning that while they come ultimately from wages, they are not themselves products of the holder’s labor. As such, the landlord pays for the land, the structure, and all maintenance, which includes the landlord’s wages, the wages of others, and any surplus the landlord pays to others (including interest or profit), as well as taxes.
When the landlord finds a tenant, the landlord passes all of the expenses down to the tenant, such that the tenant, or a chain of tenants more likely, pay for all of the expenses over a period of time. A landlord who performs their own labor will receive wages and profits, wages equal to the cost of a property manager, and profit a return above that for having an exclusive (monopoly) right to bargain for the job. The landlord will also make interest on their structure and rent on their land as property values rise. As such, the tenant pays all costs and surpluses, the entirety of expenses.
In the expenses, it must be remembered, are surplus returns, returns that are not paid as wages for cost. Let’s flesh this out. Cost is any kind of effort or endurance that takes place for domestic or civil purposes (not including criminal or government purposes), and is entirely composed of labor and labor products that have been created or duly paid-for by the holder, being the cause of the reward of wages, its compensation. Surplus is any return above cost, being not a compensation for civil labor (they are not a cost), but a payment for simply holding the property that is being leased. That is, wages are paid to the laborer for the cost of laboring, but interest, profit, and rent are paid to the capitalist, boss, and landlord for the privilege of owning. However, all wealth-creation requires cost, and so all interest, profit, and rent are actually the unpaid wages of cost, of labor, because capital, privilege, and land do not produce anything, labor does. Rent, interest, and profit, that is-- surplus returns--, are what happens when the wages of labor are handed over to non-laborers because those non-laborers own the property being used by the laborer.
We are tempted to think this is fine. Indeed, we are used to making purchases, where we hand over our wages to others so that we may have what it is that we wish to have. But there is a major difference between trading wages for wages and wages for a surplus return. In the case of wages for wages, each has contributed their labor into the economy. In the case of wages for surplus, the laborer has contributed but the surplus-holder has not actually relinquished control of their property, and so has not contributed anything at all to society. It is like a renting a hotdog and having to vomit it back up whole when one is done with it, having received nothing but the experience. And what is it that composes the experience?
The landlord is absent from that area which has been leased, and so is an absentee claimant. As an absentee, by any sturdy ethical standard, and under traditional customary law now widely infringed, they must either admit to abandoning or to selling their property, but this is not the case. Instead, the landlord affiliates themselves with the state privilege of absentee property protection, which is afforded by the taxes that the tenant pays for in their contract rent. As such, the experience of the tenant amounts purely to freedom from harassment and aggression. Contract rent is protection money paid so that the tenant does not face physical harm from the allies of the landlord, the police, who will evict them with force if they maintain their natural claim to the property they are occupying, using, and compensating the previous owner for.
It must be understood that loss is not cost. For something to be a cost, it must be an effort or endurance undertaken for the ends of civil society. As such, the effort of the burglar is not a cost, and neither is the effort of the policeman, because both crime and government fall outside of the definitions of civil society. As such, governments and criminals do not face costs in their capacities of criminals and governments, and their allies, landlords, bosses, and capitalists, do not face costs either to the extent that their efforts are uncivil, such as collecting surpluses. Surpluses, that is, if lost, are not a cost. There is a difference between an uncivil, political or criminal loss and a civil, economic cost. The landlord, as landlord, does not pay an economic cost, though they may in their capacity of laborer when performing maintenance or construction, but only to that extent.
When a landlord leases their property to a tenant, the tenant pays all costs and surpluses, the entirety of expenses, but does not receive the title to the property. The landlord, who at most has performed the labor of a builder and maintainer, has their property paid for by others who remain propertiless and by extension often penniless. The landlord has received compensation but has not relinquished control of the property, having the special privilege to do this because of affiliation with the government, and thereby falling outside the limits of civil society, their actions not being wholly economic but instead political-economic, their rent, interest, and profit a tax upon the tenant, a tribute paid to the protection racket.
To suggest that a tenant could not get by without a landlord is to suggest the absurd notion that the tenant can afford the costs and the surplus, but not the costs alone. The tenant currently does not only pay for the original costs born by the landlord, the fixed and variable costs of ownership, but atop this any surpluses (including taxes) the landlord must pay others as well as what surpluses the landlord can claim for him or herself. To suggest that the tenant needs the landlord is to suggest the absurd notion that the landlord is somehow providing a charitable service to the tenant, to suggest that the landlord is bearing expenses that are not being passed along and paid for by the tenant, as if landlords are altruists who will bear costs without compensation. Rather, the tenant pays not only the costs of the landlord, but the landlord’s surplus and the surpluses the landlord owes to others, making the tenant fully capable of affording their own existence if freed from the protection racket that allows landlords to keep that which they have been more than compensated for.
This logic regarding land, rent, and landlords likewise extends to capital, interest, and capitalists as well as to licensing, profit, and bosses. Just as the tenant pays for all of the expenses of the landlord, the hireling pays for all of the expenses of the capitalist and boss (often the same person). We are used to thinking of employment as something different from a lessor-lessee relationship, but it is not. The employee effectively rents the licensing of the boss and the capital of the capitalist, with their contract rent including the payment of all interest and profit to the boss from out of their own wages, leaving just enough for them to keep coming back to do it again. The employee, as such, though perhaps alongside the owner if an owner-operator, pays all the major fixed and variable expenses of the business, but does not receive access to partnership or exchange in the business as a co-operator or new owner. Instead, the owner, as capitalist and boss, reaps all of the rewards, leaving the employee that has enriched them destitute. Just as the tenant does not need the landlord to usurp them, neither does the worker need a boss or capitalist to wring out their pockets. The workers create all of the value, and it is taken from them in their capacities as tenants and employees, transforming the wages that should enrich them into profit, interest, and rent for wealth-taking idlers who threaten acts of aggression if tribute is not paid or if that paid for is claimed by the occupant and user.
It is not sufficient to try to hold landlords or other surplus-holders to individual account. That which they are doing has the sanction of society, owing to the widespread ignorance of its constituents. As such, this is a social, rather than an interpersonal, problem, and must be treated on a social, rather than an interpersonal, level. The entire system of expectations and practices must be transformed from one of piracy and cannibalism to one of reciprocity and mutuality.