Land monopoly doesn't necessarily imply that just a few people hold all the land, though there are places in which that turns out to be the case. A single acre of urban land can be worth as much as 100,000 acres of agricultural land, and its owners are in a position to pocket incredible amounts of rent — which has to come from someone!

When rent on valuable land lodges in private pockets, or corporate pockets, it isn't available to support public spending -- schools, bridges, subways. So to pay for those things, we use income taxes and sales taxes. The benefits of that spending come in the form of higher property values, which benefit a fairly narrow class of people: those who own our best land. See also: Pork!

We are land creatures. None of us are born with hot air balloons on our backs. As we currently organize our incentives and tax laws, a few of us are able to get rich from this particular quirk of being human. The alternative, of course, is to collect the annual value of the land from whomever has title to it, and use that as the foundation for our public spending. Even if it alone is not sufficient to replace all of our current taxes, why shouldn't it be the first tax we use, supplemented by less logical taxes only if necessary?

H.G. Brown: Significant Paragraphs from Henry George's Progress & Poverty: 12. Effect of Remedy Upon Various Economic Classes (in the unabridged P&P: Part IX: Effects of the Remedy — Chapter 3. Of the effect upon individuals and classes)

When it is first proposed to put all taxes upon the value of land, all landholders are likely to take the alarm, and there will not be wanting appeals to the fears of small farm and homestead owners, who will be told that this is a proposition to rob them of their hard-earned property. But a moment's reflection will show that this proposition should commend itself to all whose interests as landholders do not largely exceed their interests as laborers or capitalists, or both. And further consideration will show that though the large landholders may lose relatively, yet even in their case there will be an absolute gain. For, the increase in production will be so great that labor and capital will gain very much more than will be lost to private landownership, while in these gains, and in the greater ones involved in a more healthy social condition, the whole community, including the landowners themselves, will share.

• It is manifest, of course, that the change I propose will greatly benefit all those who live by wages, whether of hand or of head -- laborers, operatives, mechanics, clerks, professional men of all sorts.
• It is manifest, also, that it will benefit all those who live partly by wages and partly by the earnings of their capital -- storekeepers, merchants, manufacturers, employing or undertaking producers and exchangers of all sorts from the peddler or drayman to the railroad or steamship owner -- and
• it is likewise manifest that it will increase the incomes of those whose incomes are drawn from the earnings of capital. ... read the whole chapter

H.G. Brown: Significant Paragraphs from Henry George's Progress & Poverty: 13 Effect of Remedy Upon Social Ideals (in the unabridged P&P: Part IX: Effects of the Remedy — 4. Of the changes that would be wrought in social organization and social life)

To remove want and the fear of want, to give to all classes leisure, and comfort, and independence, the decencies and refinements of life, the opportunities of mental and moral development, would be like turning water into a desert. The sterile waste would clothe itself with verdure, and the barren places where life seemed banned would ere long be dappled with the shade of trees and musical with the song of birds. Talents now hidden, virtues unsuspected, would come forth to make human life richer, fuller, happier, nobler. For

• in these round men who are stuck into three-cornered holes, and three-cornered men who are jammed into round holes;
• in these men who are wasting their energies in the scramble to be rich;
• in these who in factories are turned into machines, or are chained by necessity to bench or plow;
• in these children who are growing up in squalor, and vice, and ignorance, are powers of the highest order, talents the most splendid.

They need but the opportunity to bring them forth.

Consider the possibilities of a state of society that gave that opportunity to all. Let imagination fill out the picture; its colors grow too bright for words to paint.

• Consider the moral elevation, the intellectual activity, the social life.
• Consider how by a thousand actions and interactions the members of every community are linked together, and how in the present condition of things even the fortunate few who stand upon the apex of the social pyramid must suffer, though they know it not, from the want, ignorance, and degradation that are underneath.
• Consider these things and then say whether the change I propose would not be for the benefit of every one — even the greatest landholder? ... read the whole chapter

What is the difference, economically speaking, between the slaves of South Carolina, Missouri, Mississippi, and Georgia and the free peasantry of Ireland or the agricultural laborer of England? (Cheers) Go to one of those slave states in the slave days, and there you would find a planter, the owner of five hundred slaves, living in elegant luxury, without doing a stroke of work, having a fine mansion, horses, [and a] carriage — all the things that work produces, but doing none of it himself. The people who did the work were living in negro huts, on coarse food; they were clothed in coarse raiment. If they ran away, he had the privilege of chasing them back, tying them up and whipping them and making them work.

Come to this side of the Atlantic, in a place where you saw the same state of development. There you found also five hundred people living in little cabins, eating coarse food, clothed in coarse raiment, working hard, yet getting only enough of the things that work produces to keep them in good times, when bad times came having to appeal to the world for charity. But you found among those little cabins, too, the lordly mansion of the man who did no work. (Hear, hear, and groans)

You found the mansion; you did not often find the man. (Laughter and cheers) As a general rule he was off in London, or in Paris, enjoying himself on the fruits of their labor. (Hear, hear) He had no legal right to make them work for him. Oh! no. If they ran away he could not put bloodhounds on their track and bring them back and whip them; but he had, in hunger, in starvation, a ban dog40 more swift, more keen, more sure than the bloodhound of the south. (Cheers)

The slaveowner of the south — the owner of men — had to make those men work for him. He went to all that trouble. The landlord of Ireland did not have to make men work for him. He owned the land, and without land men cannot work; and so men would come to him — equal children of the Creator, equal citizens of Great Britain — would come to him, with their hats in their hands, and beg to be allowed to live on his land, to be allowed to work and to give to him all the produce of their work, except enough to merely keep them alive, and thank him for the privilege. . . . ... read the whole speech

Today, more than ever, persons of great wealth have fled the cities and bought up (or retained) vast and valuable lands in rustic retreats. To name but a few, there are San Juan County, Washington; Aspen, CO; Vilas and Walworth Counties, Wisconsin; Napa and Sonoma Counties, CA; the Sta. Ynez Valley north of Sta. Barbara; Kenedy County, TX; Barrington, IL; the Hudson Valley; Berkshire County, MA; Nantucket Island, MA; Manchester/Dorset and Woodstock, VT; Fauquier County, VA; Bourbon County, KY; and much of the whole State of NM. In addition there are individual spreads so vast they constitute regions in themselves:

• San Simeon,
• the Newhall empire,
• the Bosworth and Chandler and Tenneco ranches,
• the King Ranch,
• Sta. Catalina Island,
• the Irvine Company and the O”Neill holdings in Orange County, CA,
• the McIlhenny lands in Louisiana,
• Gardiner’s Island, New York,
•  the Georgia-Pacific and Weyerhaeuser timber holdings,
• the Scully farms in Illinois,
• the timber empires of northern Maine, and so on.

The power of tax bias to keep land from its best use is starkly obvious by analyzing the economics of using marginal land. Any tax at all will sterilize such land completely, unless the taxes are so universal that the mobile factors, labor and capital, cannot escape them by moving.

“Who cares about marginal land?”, some may say. The distorting power of taxes has been demonstrated inadvertently by Chicago-School economists Gale Johnson and Stephen Cheung. They have shown that sharecropping, as a private arrangement, creates a bias on the part of tenants to substitute land for labor and equipment, almost without limit. This is because extra land costs the cropper nothing, unless it adds to output, so the cropper’s interest is to substitute land, which is free to him, for his labor and capital, which he pays for.

Taxes based on gross output affect all landowners the same way the cropshare lease affects croppers. They make every landowner a cropper of the state, giving every landowner a motive to substitute land for labor and capital indefinitely. Private landlords overcome this by limiting how much land to allow each cropper; but the state has no such offsetting control. Thus, each landowner’s motive to acquire excess land runs wild.

In conjunction, consider that taxes (other than property taxes) are based solely on cash flows, thus entirely exempting all the imputed income from and imputed consumption of the service flows of land – the “amenities.” Government tells the landed gentry, “Hold land as a totem, an heirloom, a private hunting and riding park, a dream of future retirement, a speculation, a hedge against inflation, an entry into high society, a beach access, a protection against future neighbors, a shooting range, a golf course, a ski hideaway, a drinking club, a private landing strip … anything private and narcissistic or exclusionary or snobbish … and your pleasures are tax exempt. Produce goods and services for others, though, and we will treat you like a sharecropper – and tax your employees, too.”

Now hark back to George’s second force holding labor off the better lands (Item A,3,b): holding land as a totem. He noted that tendency in an age before we even had an income tax, or state sales taxes. Our present tax system magnifies the tendency beyond all reason, resulting in the relegation of much of our best land to the indulgences of the landed gentry, old and new.  ...

City and country. Few studies ever hit such a sensitive nerve as Walter Goldschmidt’s (1947) demonstration of the greater sociological health and wholesomeness of Dinuba, CA, compared with nearby Arvin, CA. Dinuba is surrounded by small farms in the Alta Irrigation District, which taxes land values. The District also taxes land values inside the city itself. Arvin is surrounded by giant industrial-type farms, “factories in the fields,” without such taxes.

Goldschmidt’s prose was tedious, melding acadamese and bureaucratese – anything but rabble-rousing. The values he celebrated were square and middle-class – nothing of Greenwich Village. Yet the substance resonated radically. The big owners sensed a vital threat. They roared and threatened and reared up with their political power, and “terminated with extreme prejudice” the Bureau of Agricultural Economics, the agency that sponsored the study. That tells us something about its deep significance and its threat to the landed establishment. Goldschmidt identified a viable, market-oriented, indigenous American alternative to gigantic, absentee-owned industrial agriculture exploiting cheap migrant labor.

No Georgist to my knowledge has yet drawn the Georgist morals from this great study. Goldschmidt himself was only dimly aware of the role of land taxation in his story. The facts are there, the documents are there … only the scholars, so far, are missing. Read the whole article

Walter Rybeck: The Uncertain Future of the Metropolis

Mason Gaffney: Two-rate in Reverse

Karl Williams: Landlording it Over Us

Britains' wealthiest man gets rich the easy way -- he has his underlings collect and bank his rent. And if the rents from his vast land holdings weren’t enough, soaring property prices have escalated his net worth sky high – to be exact, UK£11.5 billion. To give him his full title, he is His Grace, Gerald Grosvenor, OBE, Sixth Duke of Westminster.

Forget the vast tracts of rural land, including a 100,000-acre estate in Scotland which contains no less than three mountains. The 300 acres the duke owns in central London, comprising Mayfair and Belgravia, are today one of the most valuable patches of ground on the planet.

It was a handy marriage which brought this fortune into the Grosvenor family’s hands – in 1677, Sir Richard Grosvenor married Mary Davies, heir to the hundred acres north of Piccadilly and the “Five Fields” south of Knightsbridge. During the 18th and 19th centuries, Mayfair and Belgravia were built up as residential areas for London’s wealthy classes, a position they have occupied ever since. Unlike many other great landowners who have cashed in, the Grosvenors held on and have benefited enormously from the latest boom in London property prices.

The duke has nowadays diversified his land portfolio. His commercial property company, Grosvenor, has become a serious player, with a vast array of investments and developments around the world. These include office blocks in San Francisco, business parks in Vancouver, luxury apartments in Hong Kong and shopping centres in Spain and Portugal. In the UK, Grosvenor has developed Festival Place shopping centre in Basingstoke and is set to undertake a £700m. mixed-use redevelopment in the centre of Liverpool. Back in his tract of Mayfair, land values are in the stratosphere: in 2001, BP’s pension fund sold ten acres of Mayfair for a cool £335m.

Is it any wonder that, given how there is little or no land value taxation, the duke has all his many eggs in the land investment basket? But it’s not just for economic considerations that he could never contemplate selling his vast acreage, for he has a philosophical reason for not selling. (Have a bucket ready before reading the following!) “This is part of my heritage, my birthright. It is not to do with anything materialistic, but is deeply ingrained.”