Impressions of a Georgeist
in Switzerland

Pavlos Giannelia

[Reprinted from Land and Freedom, November-December 1939]

"In the Swiss National Exhibition of Zurich, the section "Home and People" had an inscription, which looked inspired by Free-Trade:

"No fuel, no coal, no iron, no gold,

"If we were to depend upon our own raw material only,

"Our life would be similar to that of our lacustral ancestors."

A few numbers will illustrate this truism: The average value of a ton of imported goods is 175 francs ( = $44) and that of the exported ton 1,675, i.e., nearly ten-fold.

Without owning iron ore and without owning gold fields, Switzerland, notwithstanding, produces 70 per cent of all the watches produced in the wide world! The watch export of Switzerland represents a global value of 250 millions of francs a year, i.e., a quarter of all the Swiss export value, amounting to 800 millions in 1936 and 1,300 millions in 1937.

The import excess of 600 millions on the average is covered by touring and banking. Georgeians know very well that an import excess over export isn't a loss, but a gain. Who would suppose that under such conditions the Federal Government, instead of saving import from every hindrance by custom-duties, makes the tariff its largest source of revenue? Sixty-two per cent of a total federal revenue of 525 millions are custom duties, not only on luxuries as tobacco, wine and beer malt, but also on commodities like fuel, automobiles and metals, n necessaries like sugar, textiles and food.

Henry George insisted in his Protection or Free Trade hat tariffs are not the best means to raise revenue for le treasury. It has been proved also by Swiss economists lat the burden that a tariff causes to the whole of the economy is about thrice the amount of the custom-duty return. For Switzerland it is about a billion of francs in the year, or in the average 250 for every citizen, more than the average tax and rate burden!

It seems to me that it would be a really patriotic act to open the frontiers for every sort of goods, so as to free the citizens from this terrible burden, but enabling also the treasury to dispose of a larger land value to levy a land-value tax. Being given that every tax suppression provokes a corresponding rising of land value, free trade would certainly be more patriotic than the "Buy Swiss products!" propaganda which incites to buying dearer, on the pretext that "money remains in the country."

In the federal budget you will vainly search for any land tax. Only in the cantonal budgets you see landed property and agricultural income taxed, but taxed at the same rate as every other property, consisting of houses and cattle, and like every other, industrial or professional, income. Nowhere is there a special land tax according to size, fertility, value or rent of land.

To contend with work-stoppage, Switzerland (communities, cantons, federal government, corporations and individuals) spent in the last six years nearly a billion ( = $250,000,000) for getting employment. The best means to get employment would be a sane land-value taxation in substitution of federal custom duties (325 millions) and cantonal rates on property and income (200 millions). But unfortunately neither the agricultural nor the professional or industrial population have up to today been prepared for Georgeian ideas and the advantages of our reform. Not even the first step for such a fiscal reform is in evidence. There are no statistical data distinguishing between the land value and the value of improvements.

The fact that the Swiss cantons like the single states of the U. S. A. have fiscal autonomy and the right of referendum, would enable one of the 25 cantonal governments to make the beginning, by the replacement of its cantonal rates by a land-value tax. It must be emphasized that such a reform would prove all its efficacy only when followed by the suppression of the custom duties.