Mark Monson

Ricardo's Law of Rent states that rent is all production over what a similar application of labor would produce on free land. How can we apply this law to the real world to get rent per acre? If production on free marginal land is $600 per acre per annum, does that mean that rent on an urban acre is all production over $600 per annum?

No. It doesn't work that way. The reason is increase in density nearer the city core.

One of the occupations with the highest productivity per acre is the high rise office worker. This worker requires less than 800 square feet of building space. A fifty story building on an acre of land can provide work space for 2722 office workers. One of the occupations with the least productivity per acre is the farmer. One full time farmer may require 100 acres to work with.

Yet, the office worker and the farmer could produce nearly the same value per worker. Assume the farmer and the office worker each produce $60,000 per year. The farmer's 100 acres produce $60,000 per year, or $600 per acre. The high rise office worker's 800 square feet produces $60,000 per year, multiplied by the number of workers per acre ( 2722) equals $163,320,000 per acre.

Obviously, the location rent for the high rise office building is not 163,320,000 minus 600 = $163,319,400. per anum. That would mean that annual wages for 2722 workers, not to mention interest on capital, would have to come out of $600 per year.

Rent rises as the advantage in production per worker gained by superior location. Increase in density increases production per acre with no increase in rent. Put another way: increase in density makes rent a smaller percentage of production per acre.

The change in density from farm land to industrial land could be from .01 workers per acre to 100 workers per acre. This is a thousand fold increase in density and possibly a thousand fold increase in production per acre, without any increase in rent. At the line between farmland and industrial land, rent for the acre of farm land is the same as for the adjoining acre of industrial land.

And that's why Ricardo's law of rent doesn't work across different land use densities.

Harry Pollard

Mark,

There are kinds of Rent. We can call one Natural Rent and it applies to value intrinsic to a location. The other is Location Rent and is the value that attaches to a location because of the presence of the surrounding community.

The "island" we have come to know and love, because we met it in the Basic P&P Course, has nothing to do with Location Rent. It is a model showing differences in intrinsic fertility. It is the same kind of Rent that is found in gold mines and oil fields.

There can be both Natural and Location Rents at a particular location, but Natural Rent is unlikely to be found in a city.

So trying to relate the two Rents is an exercise in futility. It can't be done. (Though each can be separately calculated.)

Urban Location Rents will be unlikely to provide more than enough to satisfy the financial needs of a city infrastructure (perhaps, also, a few basic services such as transit and police). The treasure intrinsic to the land (natural Rent) should be a good source for State and National revenue.

Mark Monson and Dan Sullivan

Rent should be only high enough to ensure most efficient allocation of locations. Everything else should go to wages and interest. This will happen when location rents are the same as if every site was open for bid each year.

Dan Sullivan responding:
Even without rack-renting, the law of rent will still ultimately drive wages down to the lowest amount people will accept.

The Law of Rent:

"The rent of land is determined by the excess of its produce over that which the same application can secure from the least productive land in use."

--Henry George, Progress and Poverty (168)

Dan Sullivan responding:
You have stated it, but George also followed it to its logical conclusion -- that it drives wages to a minimum. Land speculation hastens the process, but the process advances in any case. As people become more prosperous, they will want more land for less productive purposes, such as recreation and even isolation. This will tend to drive wages down.

The Law of Wages:

"Wages depend upon the margin of production, or upon the produce which labor can obtain at the highest point of natural productiveness open to it without the payment of rent."

--Henry George, Progress and Poverty (213)

This means that production at the rent free margin will be take home pay for all workers at all locations, except for differences in output because of superior skill and industry. Since full land value taxation will cause production at the margin to increase, wages for all workers will also increase, and this is BEFORE COMPENSATION FROM ANY RENT DIVIDEND.

Dan Sullivan responding:
That is a static analysis, for it will indeed do this at first. However, the margin will once again creep downward.

Dan Sullivan and Mark Monson

Rent-sharing should be local, at first, with free migration. One cannot scientifically go further until one can distinguish what should be returned to particular communities for collective enterprises and what should be shared across larger boundaries.

Mark Monson responding:
I've reversed my earlier opinion that rent should be shared globally. The rent free margin is the natural border that defines a rent sharing community. As long as immigration is free, there is no moral obligation to share rent beyond the margin. Rent sharing is a means of securing equal access to people who are competing for sites in a particular community. If you're not in that community, their rent sharing arrangements have nothing to do with you. To claim part of their rent would be like saying that a group of people who exchange gifts are wrong to not give one to you even if you aren't giving one.

Minerals are another issue. Non renewables should be open for royalty bid to every person on the planet and collected royalties should be shared with the greatest number that is politically feasible.

In both cases, open migration is the great equalizer. However, there should be a way to recognize the advantage of, for example, sharing the arctic oil reserve royalties over a broad area rather than having people live there in order to enjoy those royalties.

Although assessing individual land and improvement values separately is a fairly well established science, assessing land values that attach to collective improvements (roads, parks, etc.) would have to be established totally from scratch.

Mark Monson responding:
I see no reason to assess value of public lands.

There are several reasons. One is to see if the value added by a public amenity exceeds the rental value and other costs of the amenity itself. This is a litmus test for whether we should keep the amenity.

Another is that the people who funded the construction of the amenity might be able to rightfully claim rent shares that derive from it, and not have to divide those shares with immigrants or outsiders. I am uncertain about this, but there is merit to the argument.

Harry Pollard

Mark,

You wrote and Dan confirmed:

"Since full land value taxation will cause production at the margin to increase, wages for all workers will also increase, and this is BEFORE COMPENSATION FROM ANY RENT DIVIDEND."

No Rent is paid at the margin. It's marginal, because no more can be produced there. So how will full land value taxation cause production at the margin to increase?

Dan Sullivan responding:
You speak of the margin as if it were a static place. As premium land comes into use, the margin will move to more productive land, meaning that production at the new margin will be higher than production at the old margin. Thus, land value taxation will cause marginal production to increase.

Unless, you mean that land capable of producing above the margin will be freed for use by labor.

Dan Sullivan responding:
No, land that is freed of rent is, by definition, not above the margin.

But, then it is the freeing of land held out of use -- along with underused land (perhaps more important) -- that will raise wages.

Even as Rent is reduced (and along with it the CD)!

Dan Sullivan responding:
Although rental value might be reduced, it is likely that the actual volume of realized rent will not be. That is, rent rates are racked up higher by an artificial shortage. The artificial shortage, on the other hand, represents rentable land that is not realizing its full rent. When all the rentable land is actually being rented, this increases the volume of rent collected, and could easily offset the fact that the rent per parcel has dropped.

Meanwhile, general productivity will rise rapidly where there is no idle land speculation and no productivity taxation, and rent advances will capture that increase in productivity, as they always have. Thus, rents will once again rise faster than wages. Of course, if the rents to to citizen dividends, this does not matter.

Couple of other things!

Mark, you said:

"then the market would determine the price of land. Price is a pretty good reflection of economic rent because obviously people will be willing to pay higher prices for the opportunity to capture higher economic rent - i.e. the advantage that a particular site has over the marginal site."

The market is a terrible way to determine Rent - even when 100% Rent is collected, which means there is nothing to sell.

Dan Sullivan responding:
I didn't bother with that semantically sloppy statement, but land would have only a rental price, not a selling price. Selling price is a reflection of the capitalized value of rents that the landholder projects as remaining with him. There would be only rent bids, not sales bids.

Is there?

There should still be wheeling and dealing for a site -- even with full Rent collection.

Trump might be able to pay far more than you or I because he's a great developer. We can pay $10,000.

So, he pays an extra $30,000 for a site. Should that be taxed?

Dan Sullivan responding:
You portray him not only a great developer, but as a fool. He needs pay only $10,001 to get the site, but that would be a rent bid, not a purchase price, unless you don't buy your own argument.

If you say yes, then you are agreeing to taxing Trumps abilities. You are a Wages taxer.

Aren't you?

Dan Sullivan responding:
No, he isn't, but he hasn't said yes, and shouldn't say yes to a question tortured out of such an absurd hypothesis.

Harry Pollard

Dan,

My word, how you splutter, Dan, when you're having fun.

Your first paragraph doesn't matter. You have inserted it in the middle of what I was saying. I think you only read the first paragraph, commented on it, then read the second, which made the point you said I didn't make, but no matter.

If you read more carefully, you would have noticed that Mark was speaking from the point of view of an existing margin - the one that is around subsistence level. So my remarks were directed from the point of an existing condition and my fairly mild point was that wages would rise because, as I put it, " ... it is the freeing of land held out of use ...

that will raise wages.

If you agree with that, Dan, you don't need to vent your spleen. Just remind everyone that the "margin" in the future will be higher than the present margin - about which we were talking.

Before we get to where you are completely wrong, it's fun to comment on the Trump bit.

I compared Mark and I to Trump, pointing out that our abilities would allow us to pay only $10,000 for the location (after Rent had been completely collected), whereas Trump could pay $30,000 because of his entrepreneurial ability. Now, I was making a comparison between us and him. I didn't mention the other 193 people who bid (I thought listing them would take up to much space). I was sure Mark would get the point without needing to explain it.

But, you had your little funny and we must allow you to enjoy yourself, mustn't we - even if little progress is made in the discussion.

Then you gave a final dig at my "semantically sloppy" statement. I agree it isn't well phrased - but it is correct with my view of Rent - but not correct with your mistaken view.

An important characteristic of Rents is the way they all relate to one another. Thus, the Danish "street valuations" which place a single value on all lots in a street (variations is size, shape, and corner influence, are dealt with arithmetically). The Rent in the next street will relate to the Rent values in the first street - maybe a little more or a little less.

This makes valuation of a city easy - or, at least, easier. One can look at a Danish land value map and see how the values relate to each other.

This is nothing like the procedures you have mentioned on many occasions on this list, where an assessor will calculate a whole building value on his way to a land value, prying into a citizen's records, making the soviets look positively angelic. You have even pointed out how citizens will enthusiastically jump at the chance of helping.

Yet, when all the investigation and calculating is finished, the Rent of the location should be the same as the lot next door.

The possibilities of corruption with these jackboots are legion. Now contrast this with the openness of a land-value map with all Rents relating to all others. Maps that can be purchased by anyone - or perused at the local library. "Why does my friend in the next street have a lower Rent?"

Instead of: "She has an extra block to go to the bus stop" or something similar, your assessors can point out that when we allowed an extra percentage for depreciation of her kid's tree house, we calculated a lower Rent.

An important point of a Georgist system is that everyone understands it. The reason why it ended in Denmark, I would suggest, is because the Danes didn't understand what it was all about. Now it may seem out of place to discuss how to keep a system when we haven't even got it - but I would say this is the time, before we get into a situation that cannot be defended.

Now to the market determination of Rents. Let's say that on this street of (say) empty lots of equal Rents, Trump wants to acquire a lot in competition with the other 195 bidders.

He wins at $30,000 and the rest of us cannot pay that price and make a profit from building there. If that buy sets the Rent, then presumably the other similar lots also have their Rents set up by $30,000. If selling price bothers you, make it an extra "rent" payment. (In the central city, where Rents might be (say) $1 million plus a year, the extra $30,000 doesn't seem so significant.)

Now Trump (you say) has increased his "rent" by $30,000 a year. But surely, this means the other similar lots in the street have also increased by $30,000 - a figure that only Trump can meet. Mark and I can't afford the extra rent - we can only afford $10,000.

This applies equally to the other losing bidders.

Welcome to a street of empty lots! Hey! That seems to be what we have already - and particularly in Philadelphia.

However, that isn't the end of it. If we are determining Rents by what a person can pay, this is a direct tax on his productivity.

Now, to large extent, this error has been forced on us by the way we learned the Law of Rent at the Henry George School. Our island scenario is demonstrating intrinsic Rents.

Although we have adopted "Margin of Production" as a more general term, the original was "Margin of Cultivation". With these "fertility" Rents, people influence doesn't matter - at least as part of the demonstration.

Several fields might be luckily fertile on the island and thus get an 8 rather than a 6. However, the difference with an intrinsic Rent is that it diminishes with use as the fertility declines, something that doesn't happen with extrinsic Rent - location Rent. You can't "use up" extrinsic Rent. You do use up intrinsic Rent.

With city lots, intrinsic rent is pretty much unimportant - extrinsic Rent is our focus. This is the value that comes from the community and attaches to a location. I would argue that this value is entirely a people value -- not even a building value, except for infrastructure.

This because the job of infrastructure is to facilitate the movement of people. A site (say on an island) may be surrounded by people and have no Rent because they can't get to it. Build a bridge so they can get to it and island Rents will zoom.

But before you say the bridge was responsible for the Rent increase, consider. Would the bridge have been built were there no people?

We'll leave the peculiarities of governments out of that question.

Over the years, I've had an interesting discussion with Jeff on this point. I argue that building follows Rent. Before you build, the Rent must be high enough to make it worth your while. This is counter to the idea that building creates Rent. It doesn't.

This point raises another issue, caused by our wish to collect Rent for public purposes. Economic Rent is the advantage given to a location by the community. It's good. Trump will look for the highest Rent location for his skyscraper.

Yet, I've seen discussions on Land-Theory of people trying to avoid the Rent payments - as if they were somehow impositions. Our opponents also use this argument. In a Georgist economy, no-one pays anything he doesn't get. He gets a $1 million Rent, he pays a $1 million. However, he has a good site from which he can make a lot of money from his personal ability. (His ability on a poor site would be wasted.)

Thus, in a Georgist economy, the high Rent areas will be in great demand by the best entrepreneurs - which is why Trump would pay a $30,000 premium to the present occupier to get the location.

This is already too long - but then, Dan, you need a lot of work.

Two other points in another post. You seem to want the community to own the land, thereby being able to carry out auctions and suchlike. This is not very desirable.

Second, you have a belief in the high Rents that would be collected in a Geocracy. I don't think so. However, this is a mistake in which you are not alone. In fact, Ed - another great Georgist - suggested we would get a Citizen's Dividend of $30,000. I felt it must have been a misprint, but there you are.

John Kromkowski and Dan Sullivan

My parents live on a hill. 2/3 of the lot can't be built on. People up the street have a flat lot. But same lot size. They obviously should be assessed differently. Isn't topography a matter of intrinsic quality/characteristic, even in cities. The extrinsic qualities that make up the rental value, will be obviously the same, but the Rent won't be. Because the flat lot family could build a bigger house than the hilly lot family.

Dan Sullivan responding:
Yes, a hill is a natural feature, but the value is not an "intrinsic" value. It is impossible to determine the change in value due to slope without examining the preferences of the people who constitute the market.

In Michigan, people pay a fortune to live one a hill, or even near a hill. They even pay extra to live near an artificial hill made from dumped garbage.

The most expensive homes in Malibu are built on hillsides that periodically slide down toward the ocean or into any of several valleys. These properties command extra money, not only because of the views, but because of the isolation from less affluent nudniks.

The hills of San Francisco would have been valueless if not for the cable cars, and later for the hill- climbing automobiles.

I see no reason to talk about different kinds of rent, rather than say there is one Rent that comes from different components/qualities of a location.

Dan Sullivan responding:
I think the effort at this distinction was to determine how much rent which should be shared locally vs. globally. I think that, when we get to that point, our understanding of rent will have become so much more advanced that people will treat our discussions as being like musings about space flight by the Wright Brothers -- interesting, but not useful for design purposes.

For now, simply shifting from productivity taxes is enough. The next goal would be local rent-sharing coupled with open immigration. At that point, there might be an assessing of the value added by corporate improvements (the government being the corporation), but I see a whole can of worms even there that I could not competently discuss so far in advance.

Experience will be the great teacher, after which we will go the way of the alchemists. Even today, Russians have the strangest ideas about capitalism, and foreign socialists have told me that American socialists have truly bizarre ideas about socialism. Ya just hafta be there.

Dan Sullivan and Mark Monson

You have stated it, but George also followed it to its logical conclusion -- that it drives wages to a minimum. Land speculation hastens the process, but the process advances in any case. As people become more prosperous, they will want more land for less productive purposes, such as recreation and even isolation. This will tend to drive wages down.

Mark Monson responding:
This is how I understand your theory.

You certainly expanded upon it, without expanding upon my central point, so I will do that as we go through it.

Mark Monson and Dan Sullivan

Production at the margin will drop because general prosperity will encourage many more people to take up recreation land, second homes, etc. The farmer at the margin will then be forced to use land that is less fertile and/or father from market, thus decreasing his production.

Dan Sullivan responding:
Yes, but this is also after an initial rise to land that is closer to the market.

As his production drops, this will eventually cause wages for all workers will drop, even if production on rent bearing sites increases. Rent will take all production over what a worker can produce at the margin.

Dan Sullivan responding:
Yes, more or less.

I agree that after rent wages for all workers are limited by net wages of the farmer at the margin. Since workers are free to switch jobs, after rent wages will tend to equalize. What I can't agree with is the theory that production at the margin will drop enough to bring net wages down to what they are now.

Dan Sullivan responding:
Well, as you continue, you raise additional implicit arguments that the margin will go down.

After the change to full rent collection, the farmer at the margin will immediately gain disposable income all the production he has been paying for rent, plus what he has been paying for taxes on everything but land. Rent of $60 per acre per year doesn't sound like much until you multiply it times the 400 acres that a single full time farmer can require for grain production. That $24,000 is going to be disposable income after the Single Tax comes in. And with the Single Tax the farmer at the margin won't pay a dime of taxes. All that former tax money will go into his pocket. Beyond costs of supplies and equipment, all will be income to spend as he chooses.

Dan Sullivan responding:
Yes, and he also might choose to hold more land. My first wife's family chose to hold additional pasture land where they kept two retired horses (a race horse and a parade horse) that the children rode from time to time.

But that's not all. Because the Single Tax will make the entire economy hum, demand for the farmer's crop will increase.

Dan Sullivan responding:
Yes, in two ways. Population increase will increase the total demand for crops, and prosperity will increase the demand for meat, which requires more land per unit of protein than vegetables. However, this increase in demand for the farmer's crops constitutes an increase in demand for farmland, and this also pushes the margin downward.

And since capital will be cheap and plentiful, he can afford to have the best equipment and latest methods to increase his production still further.

Dan Sullivan responding:
Farm machinery is labor efficient, but land inefficient. Cheap capital means, therefore, a shift from production that requires more labor to production that requires more land. This also pushes the margin downward.

But, you say, the second homes and recreation lands will force the farmer to use less fertile land.

Dan Sullivan responding:
It is one of many things resulting from general prosperity that will push the margin to less fertile land.

It will be as if population increased.

Dan Sullivan responding:
No, I am saying that increased prosperity pushes the margin downward, apart from population. But, now that you mention it, will not population also increase? I don't know one way or the other, but I merely asserted that we cannot know whether the ultimate margin would be higher or lower than the current margin. Thus, I have ducked the burden of proof, and you have embraced it.

Of course, population increase is nothing new. With they way population in North America has been steadily increasing, and with urban sprawl continually eating up farm land, we might expect to find North American farmers steadily reducing output since Henry George's day.

Dan Sullivan reesonding:
Hard to say. I suspect that yield per hour of labor has increased, but that yield per acre has fallen. However, various factors, such as chemical fertilizers and pesticides, might have produced effects I have not considered.

We would be wrong. In 1890, farmers made up 43 % of the population and it took 35-40 labor hours to produce 100 bushels of wheat on 2.5 acres. In 1965 it took 5 labor hours to produce 100 bushels of wheat on 3.3 acres. In 2000 farmers made up 2% of the population, and the labor of one farmer supplied 140 persons in the U.S. and abroad.

Dan Sullivan responding:
It is not a surprise, for it is labor-efficiency. Do you have stats on wheat yield per acre?

Through droughts, depressions, rampant land speculation, and urban sprawl, farmers have continued to increase production per labor hour. Can we seriously entertain the notion that this trend will be reversed by the adoption of the Single Tax?

Dan Sullivan responding:
Nobody suggested such a thing. Wages are not a function of overall production, but of production at the margin, and wages have generally fallen, except when the wage margin was artificially enhanced by welfare payments and minimum-wage laws.

I am arguing that adoption of the single tax will *not* reverse this pattern, except temporarily as the margin of production is freed from speculative influences. Then the pattern will return, and the natural wage will once again decline.

But if the rent is being shared, the natural wage will not decline to subsistence. People will be free to refuse work and live off their rent shares.

What will happen ultimately? Why, the ever-expanding sun will grow and ultimately swallow up the earth. One can only go so far with this future-focus thing.

Dan Sullivan and Mark Monson

Meanwhile, general productivity will rise rapidly where there is no idle land speculation and no productivity taxation, and rent advances will capture that increase in productivity, as they always have. Thus, rents will once again rise faster than wages. Of course, if the rents to to citizen dividends, this does not matter.

Mark Monson responding:
And if the rents go to public goods and services as Henry George suggested, we will all have subsistence wages but really nice government goods and services. Is that the way you see it?

Possibly, yes. Not right away, but the trend would be in that direction.

Mark Monson responding:
I don't know where your theory comes from. Maybe David Ricardo. Certainly not Henry George.

Dan Sullivan provides this quote from Henry George:

"And, so, every improvement or invention, no matter what it be, which gives to labor the power of producing more wealth, causes an increased demand for land and its direct products, and thus tends to force down the margin of cultivation, just as would the demand caused by an increased population. This being the case, every laborsaving invention, whether it be a steam plow, a telegraph, an improved process of smelting ores, a perfecting printing press, or a sewing machine, has a tendency to increase rent.

http://schalkenbach.org/library/george.henry/pp043.html #p-13

Mark Monson responding:
He said wages would rise where land rent is collected and spent by the government.

Could you quote him for clarification? After all, I had also said wages would rise, but the tendency after the fact would be for wages to fall and for rents to rise.

Moreover, George opposed extravagant expenditures by government:

"Let me be clearly understood. I do not say that governmental economy is not desirable; but simply that reduction in the expenses of government can have no direct effect in extirpating poverty and increasing wages, so long as land is monopolized.

Although this is true, yet even with sole reference to the interests of the lowest class, no effort should be spared to keep down useless expenditures. The more complex and extravagant government becomes, the more it gets to be a power distinct from and independent of the people, and the more difficult does it become to bring questions of real public policy to a popular decision."

Link to the source document

He also said the benefits of government would go to rent:

"As has before been said, in the improvements which advance rent are not only to be included the improvements which directly increase productive power, but also such improvements in government, manners, and morals as indirectly increase it. Considered as material forces, the effect of all these is to increase productive power, and, like improvements in the productive arts, their benefit is ultimately monopolized by the possessors of the land. A notable instance of this is to be found in the abolition of protection by England. Free trade has enormously increased the wealth of Great Britain, without lessening pauperism. It has simply increased rent. And if the corrupt governments of our great American cities were to be made models of purity and economy, the effect would simply be to increase the value of land, not to raise either wages or interest."

Link to the source document

Clearly, if the rent flows to the whole society, then the whole society will benefit. However, if the rent is intercepted by government, acting under the pretext of being agents of society, then the benefits will go to those who control government. To put it another way, if the rent must be spent by government for our supposed benefit, rather than returned to us, then we will indeed be wards of the state.

Indeed, it will just bring us full circle, for the landlords themselves were originally agents of government, collecting rent for the common good, and gradually diverting more and more of it for their own good, and leaving us as impoverished as before. George debunks this paternalistic approach in *Protection or Free Trade*, chapter 28, "Free Trade and Socialism."

"Here is a traveler who, beset by robbers, has been left bound, blindfolded and gagged. Shall we stand in a knot about him and discuss whether to put a piece of court-plaster on his cheek or a new patch on his coat, or shall we dispute with each other as to what road he ought to take and whether a bicycle, a tricycle, a horse and wagon, or a railway, would best help him on? Should we not rather postpone such discussion until we have cut the man's bonds? Then he can see for himself, speak for himself, and help himself. Though with a scratched cheek and a torn coat, he may get on his feet and if he cannot find a conveyance to suit him, he will at least be free to walk."

In that same chapter, George speaks glowingly of a proposal to give each citizen a dividend:

"And having in mind that the income which the community ought to obtain from the land to which the growth of the community gives value is in reality not a tax but the proceeds of a just rent, an English Democrat (William Saunders, M.P.) puts in this phrase the aim of true free trade: "No taxes at all, and a pension to everybody."

This is not to say that expansion of legitimate government functions is to be prevented. George did note that rent arises just as the need for government services arises (although not in any strict proportion). It is cities that require paved streets, traffic management, sewage and trash services, and increased regulation to keep people from bumping into one another, and it is cities that, but for their self- destructive aspects, command the most rent.

It is to say that ousting the aristocrats and vesting the bounty they had enjoyed into the hands of bureaucrats is the exchanging of one set of masters for another. No, it is not even that much, for today's aristocrats are yesterdays bureaucrats, and today's bureaucrats will become tomorrow's aristocrats.

It is, in the end, the same masters in new hats, and the primary advantage to labor is that there will be a temporary freedom while the masters adjust to those new hats, and that there will be jobs for the hat-makers.

Even today, one can ask who is responsible for holding more land out of use, the private land speculators or the tax-exempt government and quasi-governmental bureaucrats. These bureaucrats are barring us from access to land for the preservation of wilderness, just as their landlord predecessors enclosed European land "for the protection of game."

Similarly, one can ask who causes more underuse of land, the private speculators or the authors of zoning laws and their economic development cronies, who hold tax-exempt urban land out of use "to promote development."

The problem with allowing government services to be substituted for a direct rent share would be minor if government were uncorruptable. However, as George noted, again from the chapter "Free Trade and Socialism,"

"All schemes for securing equality in the conditions of men by placing the distribution of wealth in the hands of government have the fatal defect of beginning at the wrong end. They presuppose pure government; but it is not government that makes society; it is society that makes government; and until there is something like substantial equality in the distribution of wealth, we cannot expect pure government."