Completing the American Revolution

Philip Finkelstein

[Reprinted from a pamphlet announcing the creation of L.E.A.F. (Land, Equality And Freedom), 1974. Philip Finkelstein, a member of the Lindsay Mayoral Administration in New York City, later became Director of the Henry George School of Social Science in New York]

While we are often reminded that we are living in a "post-industrial age" and that technological changes produce the "future shocks" that determine our response to the modern environment, we tend to forget and often ignore the crucial role of that oldest and most pervasive source of wealth and power - the land. Feudalism may be relegated to medieval history, but its vestiges, in the form of all the trappings of ownership and transfer of real property, still substantially govern much of what happens to America approaching its 200th birthday.

Who owns America, how is that land used, how much is it worth, how much does it contribute -- these are the questions LEAF hopes to answer. A full-scale effort in each of the nation's twenty-six Standard Metropolitan Statistical Areas (SMSA) will document in a simple, clear and unprecedented array of facts just who controls the single most valuable resource that literally makes up our country, not just the great national landmarks and celebrated vistas, but the lots and blocks and shore fronts and hinterlands that we like to think of as ours but seldom are.

People may consider land significant in an open or developing area, where it can be seen as such, or in the environmental sense, where it can be enjoyed as such. Yet some of the most important land of all is urbanized and developed, covered with concrete and steel, where little grows and nothing is mined and every scene is man-made. Despite its invisibility, it is the land of the city, who owns it, how it is used and how much it pays back to society that determine the fortunes of that city, if it will be developed, neglected, rebuilt or allowed to deteriorate, become a place people will flock to or one that most would shun. It is impossible to talk seriously about any of our so-called urban problems of housing, transportation, employment, municipal finance, without some understanding and knowledge of the very ground, literally, on which it is all based.

The greatest single asset of any jurisdiction, be it city, rural county or suburban village, is its land. Land in the form of property taxation bears the major burden of financing local government, all the increases in federal and state aid and revenue sharing notwithstanding. Land is the only resource subject to local control, with each jurisdiction in fact and law defining itself by its geographic bounds. Finally, and most crucially, land is the one resource that cannot escape jurisdiction. Unlike people, money, enterprise which can move about to their advantages, even at great cost, the land is fixed in its location, the basis at once for its uniqueness and its value.

The land of New York City, for example, has made it the center of the world's foremost metropolitan area. A magnificent deepwater port that attracted people and goods from all over, New York has built its position on a concentration of diversity, a wealth of economic activity spanning every field of human endeavor. With the decline of the port and the development of competitive transportation modes, the city has been turning its unique location values to other central functions, as office headquarters, cultural, scientific, health and education and social services. The concentration of stores, amusements, amenities and services are still a mecca for the seekers of pleasure and profit, keeping the city viable beyond its original economic premise. The land of the city is still among the most valuable on earth.

Yet there are vast problems. Unemployment coupled with inflation has hit population centers hardest. Millions of square feet of new office space stand vacant in New York. Acres of once viable residential neighborhoods deteriorate HI rubble as construction comes to a standstill. There are too few places between those that only few can afford and those where even fewer would willingly live. The staggering contrasts between extravagance and despair have long been the hallmark of big city life; and no fashionable diagnosis, be it in the realm of social pathology or current economic condition, can fully explain away the harsh reality. For the real answers we must still look to the land.

The real property of New York City pays almost $3 billion of the $11.5 billion municipal budget, the largest single source of local revenue. Manhattan with its smallest land mass but most intensive development pays nearly half of the tax bill, with more than $18 billion of the total city assessment role of nearly $40 billion. Yet even these fabulous sums only begin to reflect the true wealth of the city in property, especially in the location values of the land. Every day parcels are sold at more than double their assessments. Many of these are bought for their land values alone, with the current improvement scheduled for early demolition to make way for a newer, more profitable use. While construction has been badly hit, there is still enough interest in city property to create a lively market and prices of land have more than held their own. Nor are landholders convinced that prices will not go still higher, despite the recession. Even in slum areas where landlords allow their properties to deteriorate and then abandon them the value of land on condemnation may well exceed an assessment. Stocks and bonds may slump, businesses fail, giant building developments go into bankruptcy, yet the price of land in the city generally follows only one direction -- up!

Who are these fortunates who own the land of New York, be they the millionaire assemblers of midtown tracts or the slumlords of Harlem, South Bronx and Central Brooklyn? What are the benefits they derive from building -- or not building, from improving or promoting decay? How much of the real property tax bill is borne by apartment dwellers, who can't deduct it from their income tax, as contrasted with homeowners, who can? How much do the occupiers of the most valuable sites of the city pay for the benefits of their locations and how much do they gain at the public expense?

Perhaps there will be more dramatic questions to be asked about the vast stretches of land outside the big cities, about suburban tracts and the decisions to build roads, about farmers less concerned with the crops than the price of acreage to a developer, about conservationists battling to maintain rights for the exclusive few over the needs of many, or of the greed and indifference of public and private owners in their misuse of the portions of this earth they consider their own.

We need to know a great deal more than we now do about the incidence and consequence of land ownership and use in this country. It is time for this information to be clearly and bluntly available to the citizen, the taxpayer, the voter, as a matter of right. When all of us know who owns America, we can undertake the task of providing an equitable share of our country's great bounty freely to all Americans. That is the goal of Land, Equality and Freedom, a new LEAF we must all turn in the continuing American Revolution.