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| [Reprinted from the
Henry George News, August, 1957] |
Societies, like individuals, are a bit moody. At some times
they are more receptive to reform proposals than at other times, but the
need to adjust to changing conditions and concepts of rights and duties
is ever present. Any society that is incapable of reforming itself, or
unwilling to make the effort, is marked for revolution or retrogression
or both.
Horace M. Kallen, then of the New School for Social Research, in an
article on "Reformism" in the Encyclopedia of the Social
Sciences, limited the term reformer to those who believe that all social
problems can be solved by "some one specific individual doctrine or
measure. He cited prohibitionists and single taxers as examples.
By now every American should know that neither Henry George nor those
who honor him have ever claimed that his economic program would core all
our social ills. It was a practical three-point program directed toward
the social appropriation of the socially created value of land, complete
freedom of domestic and foreign trade, and preservation of the free
enterprise system.
Free trade and free enterprise are already widely accepted as
reasonable proposals. Ill-informed persons are more likely to think of
us as dreamers because of our conviction that the earth is the common
heritage of those who live upon it. This is based on the two premises
that land is a free gift of nature and that its value is due to the
growth of the community around it, rather than to any efforts put forth
by landowners. These are self-evident truths and if any of us have led
others to believe that we credited George with being the first to
discover them, we have done him and our cause a regrettable disservice.
We sometimes make the mistake of assuming that academic economists
reject these premises, but I must disappoint you. Most of them will
grasp a truth as quickly, and hold to it as firmly, as any of us. Their
disagreement with George has to do mainly with the right of society to
take from existing landowners the full value of their land without
offering at least partial compensation. This is an ethical question on
which George's followers themselves are divided. The economic premises
on which the program is based, however, have been accepted by many
university economists in this and other countries.
Our age has lost interest in some proposed reforms, but it may be that
land value taxation was never more timely than now. All around us land
values are rising rapidly with the rapid increase in population. In
almost every state, open land is being transformed into home sites for
an unprecedented number of new families, while older families are
fleeing to Suburbia. More people are aware, therefore, that it is the
increase in their number that has raised the value of land.
The tremendous rise in our tax burden is another factor that disposes
people to favor the increased taxation of land values. More of us are
now aware that taxes on the products of labor, whether goods or
services, are ultimately paid by the consumers. More of us also know
that increased taxes on land values would not increase the prices of
consumer goods one penny. This is taught in every economics class in the
land.
A third factor now working for us is the general concern over the
physical condition of our cities, best illustrated perhaps, by our
notion of the slum problem. Until the past decade most Americans thought
of slums as something peculiar to New York, Chicago, Philadelphia or
Boston, but of no immediate concern to the rest of the American people.
They now find slums, not only in other cities but in the rural
communities. The countryside, so fabled in song and story, is infected
with migratory labor camps, shack towns, Tobacco Roads, and, I regret to
say, something known during the depression as "Hoovervilles."
It has been even more of a shock to learn that there are business slums
in cities where the business districts are becoming older, shabbier and
less accessible. New centers are springing up like mushrooms after a
rain, with resulting problems that are bedeviling all of us, including
the average citizen who rightly suspects that he will have to pay most
of the cost of the cure, if indeed a cure can be found.
However slum properties are defined, it is agreed that they are
under-improved as compared with non-slum properties which serve the same
general purpose. For instance, where the value of well-kept apartment
houses of a given size is roughly equal to the value of the land on
which they are built, a slummy tenement building of the same size will
be valued at considerably less than the land it occupies. It follows,
therefore, that if the general property tax is shifted from improvements
to land values, the owners of the slum properties may find that their
taxes are increased, while the taxes of others will be decreased.
I am convinced that wide-spread interest in the slum problem offers us
entrance into minds that we have thus far never been able to reach. Some
cities are condemning and clearing certain slum areas, and building
housing units on them. This puts government into the business of owning
and managing residential property. Public housing is common in Europe,
particularly in Great Britain, and is all but universal in the Communist
countries. Experience indicates that public housing is a very imperfect
solution of the slum problem.
It is our privilege and duty therefore to point out to the enemies of
slums that there is a better way. Instead of accepting public housing,
or relying on the police power to enforce building codes, we should make
the ownership of slum properties unprofitable. Tell your friends that as
long as money can be made by the ownership of such properties we will
have slums. If, however, we take the taxes off buildings and put them on
lands, it will be unprofitable for anyone to own land that is not as
well improved as the average property in his city. Whatever else the
owners of slum properties may be, they are not fools. By making these
areas unprofitable we d9om them to extinction, and land value taxation
is the method that will do it.
The cause of land value taxation since George's death has been carried
on by those who relied on the unspectacular but relentless process of
education. For that, the best evidence is this 25th anniversary of the
Henry George School. By stressing an appeal to reason rather than the
emotions, we are, I believe, on the right road. Land value taxation,
like free trade and free enterprise, has already won many adherents
among thoughtful and influential citizens. However, each man must learn
of these things for himself, and as our population is continually
changing, the educational process must be a continuing one. Our
instincts are transmitted by inheritance, but knowledge, alas, is the
reward of hard work by the individuals who acquire it. The
cerebro-nervous system is, at best, an imperfect learning device, and in
some it is almost worthless.
While ours is an eminently practical proposal, in stressing its
common-sense practicality I do not want to disparage the idealism that
is needed to support it. No important reform can ever be achieved unless
some of its advocates devote to the reform more than they can ever hope
to gain from its final adoption. There is a kind of madness displayed by
clear-headed, devoted reformers which is the first requisite of all
progress in human affairs. If we are to leave to our youth a better
world than our ancestors left to us, it will be because some few will
make sacrifices for the many. I rejoice that the West, which produced "The
Prophet of San Francisco" has contributed its full share of these
reformers.
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