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TRANSACTIONS OF SECTION F. 875 
_ The following Papers were read :— 
1. Some Economic Issues in regard to Charitable or Philanthropic 
Trading. By C.8. Locu. 
Philanthropic trading is, for the purposes of this paper, defined as trading 
undertaken, in the case of a municipality, to provide, not the common wants of 
the community, but those of its individual members. The definition thus excludes 
trading in gas or water, but includes, for instance, the supply of artisans’ 
dwellings or municipal common lodging houses. In the case of institutions 
philanthropic trading is defined as trading undertaken to supply the general 
market, whether with the object primarily of reforming or occupying inmates or 
dependents, or solely with the purpose of raising funds, 
Of the relation of philanthropic trading to the use of capital and credit three 
examples are given: the provision of dwellings for artisans and labourers by the 
municipality, and the methods adopted, one by the Salvation Army, and one by a 
philanthropic home, in order to raise capital. 
By detailed reference to the Goldsmith’s Row and Boundary Road schemes of 
the London County Council, it is shown that, in accordance with the general 
evidence on the subject, there is loss on the purchase of land when it is utilised 
for artisans’ dwellings in the centre of London; that those displaced by a scheme 
do not return to occupy the new buildings; and that the system competes with 
private agencies, who, it they take the land at all for artisans’ dwellings, will only 
do so at such specially reduced rates as will enable them to make a profit. 
The one economic result of this philanthropic trading is to undersell the capital 
and eredit of the ordinary trader, who practically pays in diminished business for 
the advantage which the community receive—namely, the difference between the 
24 or 3 per cent. at which the London County Council, with the credit of the 
community behind it, can raise money and the 4} or 5 per cent. that the private 
capitalist would require. Other results are to cause waste, consisting (1) of the 
difference between the value of the land in the market and its value when 
reserved for artisans’ dwellings ; (2) of the continuing loss on the site, for though 
rateable value will increase when the dwellings are built, it will increase at a 
lesser rate than it would if the site were used for commercial purposes; (8) of the 
loss due to misdirection, since, after all, the dwellings do not as a rule provide 
for the very poor, but for the better class, who secure a better article at the usual 
rates of rental prevailing in the neighbourhood, For all these forms of waste the 
ratepayer has to pay. Socially, the system is wrong, as it tends to increase the 
density of the population instead of spreading it over a larger area. And the 
supply of house accommodation does not, in fact, demand State or municipal 
intervention more than the supply of food or clothing. In the former case the 
market lies at hand or the goods are brought to the house; in the latter the 
market, the cheaper accommodation, has to be sought (always a difficult matter 
with the poor) in the cheaper districts in the outskirts of the town. 
‘General’ Booth’s loans at 43 per cent. are next referred to. In this case 
spiritual credit is used for the philanthropic trading of the Salvation Army, which 
undertakes to ‘supply shopkeepers at wholesale prices? &c. The parallel is drawn 
kage the conditions of municipal trading and of such philanthropic trading 
as this. 
Of philanthropic retail trading four instances are given: the supply of common 
lodging houses, the Salvation Army tea trade, the depéts of the Church Extension 
Association, and. the free or part-pay supply of medicine and medical advice in 
out-patient departments, 
In the philanthropic supply of common lodging houses by the municipality the 
ratepayer pays twice over—tirst to meet waste of the kind referred to above in 
connection with the capital expenditure, and next in order to maintain the persons 
who resort to these institutions, and immediately or soon after apply for: relief 
_ from the rates, This is shown in detail in the case of the Blackfriars shelter of 
the Salvation Army and from evidence from Manchester and Whitechapel. 
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