1940s >> 1947 >> no-514-june-1947

The Capitalist Ethic: Don’t be a racketeer in a small way

The late Stephen Leacock wrote a humorous story on borrowing money. The man who wanted to borrow a trifling sum was rebuffed, with insults. At a few hundred dollars the insults disappeared. At the four-figure level it was possible to do a deal; but it was not until a loan for millions was asked for that the bankers obsequiously hailed the borrower as if he were a benefactor entitled to a royal reception. So it is also in the matter of running a capitalist racket.

A street hawker “who admitted overcharging for apples, oranges and lemons, was sent to prison for nine months at Manchester.” (News Chronicle, 30/4/47.)

Up the scale a little are the people who resold Cup Final tickets. These “ racketeers,” according to the Sunday Express (27/4/4,7), “made hundreds of pounds.” “One seller boasted that he had made more than £100 profit in an hour.”

Higher still we reach the big money, but they are no longer described as racketeers. The Evening Standard (22/4/47) sold of a house in Mayfair, sold in 1935 for £15,000 freehold. Slightly bomb-damaged it was sold as business premises in 1943 for £45,000; and resold in 1946 for £65,000. Nine months later it is sold again for £75,000. The Evening Standard gave publicity to the agent’s ingenious argument to show that the price “is not so extravagant as it sounds.” The argument is that it will be cheaper for the buyer to pay £75,000 for the freehold than to pay £7,000 a year as rent, at the market rate of £1 a square foot.

Higher still up the scale we read (Daily Mail, 26/4/47) of the Marquess of Bute who had just died. His fortune was “once reputed to be worth £60,000,000.” A lot of the family wealth came from the lucky possession of land in Glamorgan under which vast coal deposits were found. One of the astute deals of an earlier Marquess was to build Bute docks at a cost of £350,000. “When, in 1922, the family sold the docks to the Great Western Railway, the purchase price was £5,000,000.”

The man in jail will have nine months to ponder over the golden rule that if you want to plunder your fellow man you should take care to be born into the propertied class and consult the best lawyers to see that it is legal.