The Tax To End All Taxes

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The parasitic landowner’s share, his “economic” rent—not for any buildings he may put up, but for the bare, natural land itself—can only increase at the expense of the true producers, labor and capital (itself the product of past labor), which George saw as common victims rather than natural antagonists: “When non-producers can claim as rent a portion of the wealth created by producers, the right of the producers to the fruits of their labor is to that extent denied.” And when the owner holds his land out of production, waiting for a better pri’ce, land use is distorted because people have to move farther out to find space to work and trade and live—sprawl is what we call it today. Poverty comes with progress. Ultimately, the rough equality of prelandlord times gives way to the extremes of rich and poor, and, in a passage that suddenly jerks us back to today’s newspaper: “Upon streets lighted with gas and patrolled by uniformed policemen, beggars wait for the passer-by, and in the shadow of college, and library, and museum, are gathering the more hideous Huns and fiercer Vandals of whom Macaulay prophesied.”

In George’s view, a landholder had no more right to charge rent for land he did not create than he would to monopolize the air and charge others for the right to breathe. This is how George put it: “If we are all here by equal permission of the Creator, we are all here with an equal title to the enjoyment of his bounty—with an equal right to the use of all that nature so impartially offers. This is a right which is natural and unalienable; it is a right which vests in every human being as he enters the world, and which during his continuance in the world can be limited only by the equal rights of others.… There is on earth no power which can rightfully make a grant of exclusive ownership in land. … For what are we but tenants for a day? Have we made the earth, that we should determine the rights of those who after us shall tenant it in their turn? … Though the sovereign people of the state of New York consent to the landed possessions of the Astors, the puniest infant that comes wailing into the world in the squalidest room of the most miserable tenement house, becomes at that moment seized of an equal right with the millionaire’s. And it is robbed if the right is denied.”

The absolute ownership of land and other resources of nature is the equivalent of chattel slavery, and a more common evil. Slavery grows up where, as in the early American South, the land is so abundant that free laborers can have it for themselves instead of working it for others. Whenever land is scarce enough to be monopolized, however, laborers will be forced to “a condition which, though they be mocked with the titles and insignia of freedom, will be virtually that of slavery.” In the extreme case (here one thinks of Hawaii after the American missionaries and traders had appropriated all the land): “Place one hundred men on an island from which there is no escape, and whether you make one of these men the absolute owner of the other ninety-nine, or the absolute owner of the soil of the island, will make no difference either to him or to them. In the one case, as in the other, the one will be the absolute master of the ninety-nine. …”

Henry George’s greatest originality lay in his “remedy.” He rejected the usual alternatives of dividing up or nationalizing the land. The first was unworkable and superficial. The second violated both George’s profound belief in free enterprise (as long as its fruits were earned) and his equally profound distrust of government. The remedy was to allow private ownership of land, but for society to collect the unearned rent on that land through taxation: “It is not necessary to confiscate land; it is only necessary to confiscate rent.” The rent to be “confiscated” was the amount the owner could collect by renting out unimproved land, or if he had improved or built on it, the portion of the rent attributable to the land alone; he would not be taxed on the improvements, because those were products of his own effort. Thus society would recapture the land values society itself had created, and the owner would be forced to put his land to its best use or give it up; hoarding land would no longer pay. Furthermore, the rent, or tax, would be enough to pay all the expenses of government so that neither labor nor capital need be taxed on their just earnings. This was the “single tax” that became glued to Henry George’s name. George believed it “would enormously increase production; would secure justice in distribution; would benefit all classes; and would make possible an advance to a higher and nobler civilization.”