Land Value Taxation will solve many of the 21st century's most serious social, economic and environmental problems, and promote justice, fairness and sustainability. We CAN have a world in which all can prosper.
Progress and Poverty, by Henry George Here are links to online editions of George's landmark book, Progress & Poverty, including audio and a number of abridgments -- the shortest is 30 words! I commend this book to your attention, if you are concerned about economic justice, poverty, sprawl, energy use, pollution, wages, housing affordability. Its observations will change how you approach all these problems. A mind-opening experience!
Henry George: Progress and Poverty: An inquiry into the cause of industrial depressions and of increase of want with increase of wealth ... The Remedy This is perhaps the most important book ever written on the subjects of poverty, political economy, how we might live together in a society dedicated to the ideals Americans claim to believe are self-evident. It will provide you new lenses through which to view many of our most serious problems and how we might go about solving them: poverty, sprawl, long commutes, despoilation of the environment, housing affordability, wealth concentration, income concentration, concentration of power, low wages, etc. Read it online, or in hardcopy.
Bob Drake's abridgement of Henry George's original: Progress and Poverty: Why There Are Recessions and Poverty Amid Plenty -- And What To Do About It! This is a very readable thought-by-thought updating of Henry George's longer book, written in the language of a newsweekly. A fine way to get to know Henry George's ideas. Available online at progressandpoverty.org and http://www.henrygeorge.org/pcontents.htm
Where Else Might You Look?
Wealth and Want The URL comes from the subtitle to Progress & Poverty -- and the goal is widely shared prosperity in the 21st century. How do we get there from here? A roadmap and a reference source.
Reforming the Property Tax for the Common Good I'm a tax reform activist who seeks to promote fairness and reduce poverty. Let's start with the enabling legislation and state requirements for the property tax. There are opportunities for great good!
A. Sell them off at the current price, about $5 per acre, per the 1872 Mining Act, even if they contain minerals worth billions of dollars.
B. Sell them off to the highest bidder, as soon as possible
C. Sell them off to any bidder, as soon as possible
D. Lease them for fixed terms, to the highest bidder, with future lease prices to be calculated with an eye to making it profitable for the tenant
E. Lease them for fixed terms, to the highest bidder, and then repeat the auction in 10 years. Maintain extensive online databases so that the lease descriptions are visible to all, and the lease expirations are well advertised to all who might be interested in bidding. Make it the landlord's business to get high quality unbiased appraisals of tenant improvements, so that tenants can make sensible improvements and be secure in them. Use the revenue to reduce other taxes which burden the economy.
F. Lease them out, at market rates, with the proceeds used to generated a citizen's dividend. If there is a monopoly or oligopoly, break it up so that there is a genuine market.
G. Keep renting them out at whatever price they're now receiving; we don't want to upset anyone's plans or privileges.
I came across this in the San Jose Letter, from late 1895. Over the course of the year of issues online (about 430 pages), there were just a few articles specifically about the Single Tax. But I continue to be amazed at how much of the popular literature of the 1890-1920 period has as its context the assumption that the reader knew of and was generally comfortable with the ideas of Henry George. They were in the air people breathed, well-known to all! What I find interesting, as a long-ago American Studies major, is that a 21st century reader who isn't familiar with George's ideas, reading that literature, would miss out on most of the conversation -- and perhaps never notice the gap!
The graphic [woodcut, or "cut"] is definitely a keeper. It explains a lot of things. Location, location, location. This political cartoon covers it pretty well. (See also a recent video here.) While it isn't signed, it makes me think of J. W. Bengough's cartoons, which appeared in The Single Tax Review for a number of years in the first decade of the 20th century. Bengough was also the author of the wonderful Up-to-Date Primer: A First Book of Lessons for Little Political Economists.
I'm assuming that Franklin Hichborn, editor of The San Jose Letter, wrote this piece, inspired in part by the woodcut in the SF Star. The comparison of the 4 lots might be compared to Louis F. Post's lecture notes, at http://wealthandwant.com/docs/Post_Lectures.htm, starting at Chart 28.
Through the courtesy of James H. Barry, publisher of the San Francisco Star, we are enabled to publish the cut accompanying this article, which gives, as the Star expresses it, the "Single Tax in a nut shell." In the near future a series of articles on Single Tax will be published in the Letter, which, besides stating clearly what the Single Tax is, will give, which will be more important, what the Single Tax is not. The confusion among the people on this very simple subject, is due in the main, I fancy, to their misunderstanding of the term rent. It is proposed to show what rent is, and, by it, what is meant by the Single Tax.
Any old farmer knows, and common sense will tell the inexperienced, that in a 10 acre field, more grain can be raised by planting a bushel of seed than a quart, more by plowing the land and harrowing, than by omitting the plowing, more by having the field fenced than by allowing cattle to run over it. In a word it pays to expend a certain amount of labor and capital upon our 10 acres. But it will be just as readily recognized that the thing can be over done, that the field can be plowed so much that the last plowing does not pay, that more seed can be sown that will be justified by the returns. There is, than a point in the culivation of our field where a given amount of seed and a given amount of plowing will yield the best returns, a point beyond which it will not pay the farmer to go, where the return will begin to be deminished in proportion to the outlay. In a word, a point of deminishing returns.
Now, suppose a community to be living on an island which has no communications with the outer world. Suppose the food of the community to be, in the final count, wheat, and suppose our island to have four grades of land, one producing at the point of diminishing returns 30 bushels to the acre, one 28, one 26 and one 24. Here is our land:
30 bushels to the acre
28 bushels to the acre
26 bushels to the acre
24 bushels to the acre
So long as the 30-bushel land will supply the wants of the people there will be no rent on our island. If the 30 bushel tract is owned by ten people they will compete with each other for tenants until practically nothing is paid for the use of the land.
But when the population of our island increases to such an extent, (and by the way, it is bound to increase so long as there is free land) that the 30 bushel land will not supply the wants of the inhabitants, the 28 bushel land must be cultivated. The 30 bushel land is then in demand, for those cultivating it will, with the same outlay of labor and capital, get 2 bushels to the acre more than the 28 bushel land, and the ten owners may and will charge all they can get for its use. This will be two bushels of wheat a year or the difference between the yield of the two tracts. These two bushels will be rent.
When the combined 30 and 28-bushel tracts fail, owing to the steadily increasing population, to supply the island with wheat, the 26-bushel land must be cultivated. The owners of the 30-bushel tract will be able to get 4 bushels a year rent, the owners of the 28-bushel tract 2 bushels. When increasing population brings the 24-bushel tract into cultivation, 6, 4, 2 bushels will be charged, plus the amount which the necessities of the people, enable the owners of the 24-bushel land to charge them.
This, then, is the way rent originates. Dr. Walker defines it: The remuneration received by the land-owning class for the use of the native and indestructible powers of the soil, or, as it might be expressed, for the use of natural agents.
Our wheat producing island presents the doctrine of rent in its simplest possible form. "Land and natural agents" includes the arable, pasture and timber lands, mineral deposits, water privileges and building sites. When one piece of land becomes valuably [sic] for any reason, to a community, the person enjoying its advantages can give, and still be able to compete with his neighbor occupying land less favorable situated, the difference between the productiveness of the two tracts — rent. Who should receive this difference? Our present system says individual land-lords. Henry George says the people. He would collect this rent from land holders. This would be sufficient to meet all the requirements of national, state and municipal governments. It would be a single tax.
We have scarcely room to state them here, but briefly a few of the things the single tax is not: It is NOT a tax on acreage. It is a tax on land values. If farmer "A" has a 100-acre farm valued at $10,000, it means that the difference between the productiveness of that farm and an equal amount of no-rent land is, at our present rates of interest about $800. If city land—lord "B" has a 25-foot lot valued at $100,000 it means that lot is worth to the community, from its situation or for other causes, $8,000 a year more than the non-utilized land. The ''single tax" on the 100 acres would be then $800 and on the 25-foot lot $8,000 a year. Farmers do not seem to be able to grasp this. In New Zealand the people are blessed with a land system resembling very much the single tax: and yet, the very term, single tax, frightens the farmer of that progressive island as badly as it does the prune-growers of our own Santa Clara valley.
Rent is NOT interest, insurance, taxes as they are, or water-rates, although they are all paid by the honest plodders of the community under the name, rent. Did it ever occur to you, my honest friend, that the landlord, before whom you doff your greasy cap so humbly, and who boasts that his taxes are so much while yours are nothing, never paid a tax-bill on rented property in his life. You pay it for him. He is your agent. He figures out your rent thus:
"The land is worth so much, interest on that (this is rent) the building so much interest on that (this is interest) insurance, so much, water-rate so much, taxes so much. I can allow tenant to have the place for the sum of these."
Thus you pay the rent, interest, insurance, water rates, taxes, under the generality "rent." The landlord pays nothing in the shape of water rates, insurance or taxes. He collects interest on the money invested in the buildings, which we will not pass upon. He collects the economic rent of the land and appropriates it to his own use, which is robbery.
One word on the difference between real and personal property, and we will leave you, my honest friend, to accumulate your landlord's taxes for next year. I paid five cents for the pen-holder with which I am writing this. The man I got it from gave me title to it, which he had purchased from some one else. This some one else, in his turn had acquired title by purchase, and if we follow the title back far enough, we will find the man who first owned the pen-holder, who did not purchase it,— made it. The original title, then, to this pen-holder, rests in human labor. It is so with every piece of personal property: this paper, ink, desk, house — the title to them all is the same — human labor. And, many reforming unmentionables to the contrary, every man is entitled to the results of his own exertions.
But how about the land upon which this building is situated? A. owns it. Where did "A" get his title? From "B." Tracing this title back, shall we find it resting on human labor? Not at all. No one made this land. Some one took it; gave title to some one else, and that title stands. It rests in force, fraud or nothing.
To sum it up: Notice that the blessing of rent did not come to our wheat-producing island until the increasing population, the people, made the land valuable. The million-dollar blocks in San Francisco would not be worth $1,000,000 if the people who have built up the city had not made them so. Now, since there can be no private title acquired to land that will stand the test of reason, since the very rent is due to the people themselves, and arises from and increases with population, we say that the people are entitled to this rent. Can you give one reason why individual proprietors should take it? Can you give one valid reason why people should pay it to them? If you cannot, you must admit that the economic rent of a nation, the unearned increment of land, belongs to the people. As this rent would more than pay the taxes of the nation, no other tax would be necessary. Thus you believe in the wisdom of the single tax. What are you going to do to secure it?
Cut the accompanying picture out; hang it up where you can conveniently see it, and consult it every time that, after stretching and pinching, and starving yourself and family, you have failed to make both ends meet.