H.G. Brown: Significant
Paragraphs from Henry George's Progress & Poverty:
10. Effect of Remedy Upon Wealth Production (in the unabridged P&P: Part
IX — Effects of the Remedy: Chapter 1 — Of the effect upon the
production of wealth)
... To abolish the taxation which, acting and reacting, now hampers every
wheel of exchange and presses upon every form of industry, would be like
an immense weight from a powerful spring. Imbued with fresh energy, production
would start into new life, and trade would receive a stimulus which would
be felt to the remotest arteries. The present method of taxation operates
exchange like artificial deserts and mountains;
- it costs more to get goods through a custom house than it does to carry
them around the world.
- It operates upon energy, and industry, and skill, and thrift, like a
fine upon those qualities.
- If I have worked harder and built myself a good house while you have
been contented to live in a hovel, the taxgatherer now comes annually to
me pay a penalty for my energy and industry, by taxing me more than
- If I have saved while you wasted, I am mulct, while you are exempt.
- If a man build a ship we make him pay for his temerity, as though he
had done an injury to the state;
- if a railroad be opened, down comes the tax collector upon it, as though
it were a public nuisance;
- if a manufactory be erected we levy upon it an annual sum which would
go far toward making a handsome profit.
- We say we want capital, but if any one accumulate it, or bring it among
us, we charge him for it as though we were giving him a privilege.
- We punish with a tax the man who covers barren fields with ripening
- we fine him who puts up machinery, and him who drains a swamp.
How heavily these taxes burden production only those realize who have attempted
to follow our system of taxation through its ramifications, for, as I have
before said, the heaviest part of taxation is that which falls in increased
prices. ... read the whole chapter
H.G. Brown: Significant
Paragraphs from Henry George's Progress & Poverty:
11 Effect of Remedy Upon the Sharing of Wealth (in the unabridged P&P: Part
IX Effects of the Remedy — Chapter 2: Of the Effect Upon Distribution
and Thence Upon Production
But great as they thus appear, the advantages of a transference of all public
burdens to a tax upon the value of land cannot be fully appreciated until we
consider the effect upon the distribution of wealth.
Tracing out the cause of the unequal distribution of wealth which appears
in all civilized countries, with a constant tendency to greater and greater
inequality as material progress goes on, we have found it in the fact that,
as civilization advances, the ownership of land, now in private hands, gives
a greater and greater power of appropriating the wealth produced by labor and
Thus, to relieve labor and capital from all taxation, direct and indirect,
and to throw the burden upon rent, would be, as far as it went, to counteract
this tendency to inequality, and, if it went so far as to take in taxation
the whole of rent, the cause of inequality would be totally destroyed. Rent,
instead of causing inequality, as now, would then promote equality. Labor and
capital would then receive the whole produce, minus that portion taken by the
state in the taxation of land values, which, being applied to public purposes,
would be equally distributed in public benefits.
That is to say, the wealth produced in every community would be divided into
- One part would be distributed in wages and interest between individual
producers, according to the part each had taken in the work of production;
- the other part would go to the community as a whole, to be distributed
in public benefits to all its members.
In this all would share equally — the weak with the strong, young children
and decrepit old men, the maimed, the halt, and the blind, as well as the vigorous.
And justly so — for while one part represents the result of individual
effort in production, the other represents the increased power with which
the community as a whole aids the individual.
Thus, as material progress tends to increase rent, were rent taken by the
community for common purposes the very cause which now tends to produce inequality
as material progress goes on would then tend to produce greater and greater
Who can say to what infinite powers the wealth-producing capacity of labor
may not be raised by social adjustments which will give to the producers of
wealth their fair proportion of its advantages and enjoyments! With present
processes the gain would be simply incalculable, but just as wages are high,
so do the invention and utilization of improved processes and machinery go
on with greater rapidity and ease.
But I shall not deny, and do not wish to lose sight of the fact, that while
thus preventing waste and thus adding to the efficiency of labor, the equalization
in the distribution of wealth that would result from the simple plan of
taxation that I propose, must lessen the intensity with which wealth is pursued.
seems to me that in a condition of society in which no one need fear poverty,
no one would desire great wealth — at least, no one would take the
trouble to strive and to strain for it as men do now. For, certainly, the
of men who have only a few years to live, slaving away their time for the
sake of dying rich, is in itself so unnatural and absurd, that in a state
where the abolition of the fear of want had dissipated the envious admiration
with which the masses of men now regard the possession of great riches,
whoever would toil to acquire more than he cared to use would be looked
upon as we
would now look on a man who would thatch his head with half a dozen hats.
And though this incentive to production be withdrawn, can we not spare it?
Whatever may have been its office in an earlier stage of development, it is
not needed now. The dangers that menace our civilization do not come from the
weakness of the springs of production. What it suffers from, and what, if a
remedy be not applied, it must die from, is unequal distribution!
Nor would the removal of this incentive, regarded only from the standpoint
of production, be an unmixed loss. For, that the aggregate of production is
greatly reduced by the greed with which riches are pursued, is one of the most
obtrusive facts of modern society. While, were this insane desire to get rich
at any cost lessened, mental activities now devoted to scraping together riches
would be translated into far higher spheres of usefulness. ... read the whole chapter
Henry George: Thou Shalt Not
Steal (1887 speech)
What we propose to do is to
divide up the rent that comes from
land; and that is a very easy thing.
We need not disturb anybody in
possession, we need not interfere
with anybody’s building or anybody’s improvement. We only
need to remit taxes on all improvements, on all forms of wealth, and
put the tax on the value of the land, exclusive of the improvements,
so that the dog-in-the-manger who is holding a piece of vacant land
will have to pay the same amount of tax for it as land of similar
value with a building or other improvements upon it. In that way we
would treat the whole land of such a community as being the common
estate of the whole people of the community.
The people of New York could
manage their estate just as well as
any corporation, or any private family, for that matter. But for the
people of New York to resume their estate and to treat it as their
own, it is not necessary for them to go to any bother of management.
It is not necessary for them to say to any landowner, this particular
piece of land is ours, and no longer yours.
We can leave land titles just as
they are. We can leave the owners
of the land to call themselves its owners; all we want is the annual
value of the land. Not, mark you, that value which the owner has
created, that value which has been given to it by improvements; but
simply that value which is given to the bare land by the fact that we
are all here —that has attached to the land because of the
growth of this great community. And, when we take that, then all
inducement to monopolize the land will be gone — then these very
worthy gentlemen who are holding one-half of the area of this city
idle and vacant will find the taxes they have to pay so high that
they will have to go to work and build houses or otherwise use the
land, or give it away to somebody who will build upon it, or put it
to other productive use. And so it will happen all over the
country.... read the whole article
Mason Gaffney: The
Taxable Surplus of Land: Measuring, Guarding and
Common Property in Land is Compatible with the
You can enjoy the benefits of a market
economy without sacrificing your common rights to the land of Russia. There
is no need to make a hard choice between the two. One of the great fallacies
western economists and bankers are foisting on you is that you have to give
up one to enjoy the other. These counselors work through lending and granting
that seduce you with loans and grants to learn and accept their ideology,
Neo-Classical Economics, or "monetarism," or "liberalization." It is glitter
to distract you and pave the way for aliens to acquire and
land common while shifting to a market economy,
you simply use the tax system. Taxation is the form that common property
takes in a monetary, market-oriented economy. To tax is to socialize. It's then
just a simple question of what you will socialize through taxation, and how;
the answers lie success or failure.
Not only can you have both common land and
free markets, you can't have one without the other. They go together, like
love and marriage. You need market prices to help identify land's
taxable surplus, which is the net product of land after deducting the human
costs of using it. At the same time, you
must support government from land revenues to have a truly free market, because
otherwise you will raise taxes from production, trade, and capital formation,
interfering with free markets. If you learn this second point, and
act on it, you will have a much freer market than any of the OECD nations
that now presume to instruct you, and that are campaigning vigorously to
make all nations in the world "harmonize" their taxes to conform with their
own abysmal systems.
The very people who gave us the term laissez-faire
— the slogan at the core of a free market economy — made communizing
land rents a
central part of their
program. These were the French economistes of the 18th Century, sometimes
called "Physiocrats," who were the tutors of Adam Smith, and who inspired land
reforms throughout Europe. The best-known of them were
François Quesnay and A.R. Jacques Turgot, who championed land taxation.
accurately called it the "co-proprietorship of land by the state."
Since their time we have learned to measure
and we have broadened
the meaning of "land" to comprise all natural resources. Agrarians will
and may be surprised, that farmland ranks well down
the list in terms of total market value. Thus, a land tax is not primarily a
tax on farms; only the very best soils in the best locations yield much taxable
The most valuable land by far is city land. Ted Gwartney, a professional land
speaking to us about that. I have
data showing that well over half the value of
city real estate is the
pure land value. In big, key cities, prices per unit of land go astonishingly
high, dwarfing most other values by comparison. For example, at the height of
the Japanese boom, in 1990, land prices in that great city rose so high that
the appraised value of the land under the Imperial Palace in Tokyo was as great
as all the land in California! At the same time, within California, most of the
land value was in our cities, even though California is the premier farm state
in the U.S.A. Urban land of such immense value makes a rich, rich tax base for
you, or any nation.
Another natural resource (hence part of "land"), whose nature and value the
mass of people are only slowly realizing, is the radio
Hydrocarbons are a third set of
valuable resources. ...
The American state of Alaska holds down its
other taxes by socializing part of its oil revenues, which otherwise would inure
to a handful of the major stockholders of two corporations (ARCO and BP). Alaska
not only holds down other taxes, it pays each resident - man, woman, and child
- a social dividend
of over $1,000 per year. Go thou and do likewise. Your expert, Dmitri
Lvov from the Russian Academy of Sciences, a speaker at this meeting, has
written that you could cover most of your national budget from your enormous
Many third-world nations like Venezuela or
Nigeria have fabulous mineral oil that they fail to exploit for their own people,
letting sophisticated or ruthless foreign corporations, in tandem with weak or
reap the gains. The question for Russia is whether to follow their bad
example and become a poor resource-colony of the west, or whether to assert your
own sovereignty over your own resources for the benefit of your own people. You
look no further than
Norway for a model.
Other subsoil resources have great
value, too. ...
In arid lands, water is life, and the most
natural resource is water. For example, in southern California we need
water so much we import it from the Feather River 600 miles north of us, pump
it uphill through the long San Joaquin Valley, then over the high Tehachapi Mountain
range, and tunnel it through the San Bernardino Mountain Range, all at great
cost. When it gets here, it supplements and competes with local water that nature
provides freely in the Santa Ana, San Jacinto, and other rivers. That local water
then has a value equal to the high cost of importing the remote northern water.
That value in the local waters is a taxable surplus. However, we have not learned
to take that surplus value into the local treasuries; we give the water away,
and worse, we actually subsidize people to withdraw water by helping them pay
dams, canals, and
pipelines so they can waste water without paying for it. Thus
we turn a public asset into a public liability - an extreme form of folly that
is called "dissipating
rent." In this age of growing water scarcities it is past time we
learned to husband and nurture rent, in order to socialize it by taxing the
So should you, in
Another value from water is to
generate power. ...
Fisheries are another source of value. ...
The government did not sell these licenses,
but simply gave them away to owners of existing boats, and others with political
influence. Each license now sells for something like a million dollars, creating
a new class of
instant millionaires and "parlor fishermen." This
giveaway to the few, and takeaway from the many, created an instant class society
where before there were
equal access and equal
are worth so much that there are now documented cases off Alaska where the
parlor fisherman takes 70% of the total
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