Unimproved Land
see also: land different from capital, land different from labor, vacant land, public expenditure, infrastructure,
Charles T. Root — Not a Single Tax! (1925)
Every community, whatever its political name and extent -- village, city, state or province or nation -- has its own normal, unfailing income, growing with the growth of the community and always adequate to meet necessary governmental expenditure.
To explain: Every community has an indefeasible original right to the land on which it exists, and to all the natural, unmodified properties and advantages of that particular area of the earth's surface. To this land in its natural state, undrained, unfenced, unfertilized, unplanted and unoccupied, including its waters, its contents and its location, every individual in the community (which may consist of any political unit selected) has an equal right, while all the individuals together have a joint right to the value for use which society has conferred upon these natural advantages.
This value for use is known as "Land Value," or by the not particularly descriptive but generally adopted name of "Economic Rent."
Briefly defined the land value or economic rent of any piece of ground is the largest annual amount voluntarily offered for the exclusive use of that ground, or of an equivalent parcel, independent of improvements thereon. Every holder or user of land pays economic rent, but he now pays most of it to the wrong party. The aggregate economic rent of the territory occupied by any political unit is, as has been stated above, always sufficient, usually more than sufficient, for the legitimate expenses of the government of that unit. As also stated above, the economic rent belongs to the community, and not to individual landowners. ...
To illustrate simply, let us suppose a state which has never parted with its natural income but is supported by its own economic rent. A farmer wishes to take up a tract or [sic] government land in this state and offers an economic rent of fifty cents per year per acre in its raw condition. The government (i.e., the community) accepts this rent, subject to re-adjustment every five years. The farmer then gets his deed without other cost than that of drawing and recording the instrument, or a nominal price of, say, one dollar an acre.
He works his new property vigorously, clears, fences, drains and plants it, and puts up his buildings and stocks them. He has no taxes to pay, and at the end of his first five-year period he is making $10 per acre per year. Will his economic rent for the next five-year period be raised because he has prospered or because he has invested money in buildings and improvements? Not a penny. All the results of his own capital and labor belong to him and not to the community. If the neighborhood has not grown much, and fifty cents an acre is still all that is bid as economic rent for the same kind of raw ground as our farmer originally took, then his rent for the second five years will be the same as the first. ...An illustration has already been given of the case of a piece of farm land. Let us take an example in a large city. Let us take a corner lot centrally located in New York City, the title to which lot is held by, say, Mr. John William Rhinelastor. This lot was a part of an old Dutch farm, and is an heirloom. It did not cost the present owner anything, nor his father nor his grandfather. There is a little old building on it, which has always been rented at a figure ten times as large as the taxes imposed, so that the owner has been handsomely subsidized each year for storing his title-deeds during a period of the city's growth in which the increase in population and the expenditure of public money in that neighborhood have raised the value of this corner location to, say, two hundred times its early value. ...