Philosophy of Freedom Versus the Single Tax

Oscar B. Johannsen

[Reprinted from the Henry George News, June, 1962]

IN Progress and Poverty, Henry George stated that to collect the economic rent "we should satisfy the law of justice, we should meet all economic requirements, by at one stroke abolishing all private titles, declaring all land public property, and letting it out to the highest bidders in lots to suit, under such conditions as would sacredly guard the private right to improvements."

However, as he felt that this method might constitute too great a shock to the customs and habits of thought of the people as well as result in a needless expansion of governmental machinery, he proposed an expedient. The expedient, of course, is his famous solution of the confiscation of all of the economic rent by means of the taxation of land values, with the exception of a small percentage which the landowners could keep as compensation for services as rent collectors.

Did George make a mistake in advocating, this expedient?

To begin with let us remember that George was attempting to give to mankind some of the basic principles which contained the keys to unfetter the bonds which man has placed upon himself through his ignorance. He was not writing a treatise on economics. He was setting forth revolutionary tenets which, if men adhered to them, gave great promise of granting them the necessary freedom to live their lives to the fullest. Indeed, the possibility was good that his concepts would constitute an important part of the necessary knowledge for man, at last, to establish peace on earth good will to men.

And what is this revolutionary philosophy labeled? Is it known as the Philosophy of Peace, or the Philosophy of Freedom. Nothing of the sort. It is called a tax: The Single Tax. Why? Because the expedient he advocated caused people to lose sight of the philosophy he espoused.

Probably the most serious criticism of George's expedient is that it constitutes an unjust means to attain a just end. But it may be asked, what are the unjust means George adopted? Taxation. Taxes are immoral. The Encyclopedia Britannica states that "Taxation is that part of the revenue of the State which is obtained by compulsory dues and charges." That is merely a circumspect way of saying that taxation is robbery. Therefore, using taxation as the means to collect economic rent is on a par with stealing back your own property.

Another troublesome point is that George set up his expedient apparently as a lasting cure. While an expedient may be accepted as valid under emergency conditions, one would hardly agree that it is a proper answer for a solution of a permanent nature. An expedient is defined as something which is conducive to a special advantage rather than to what is universally right. But George was dealing with a universal right, so it would seem that he should have ignored any expedients and advocated the method which was strictly in accordance with justice.

George pointed out, "That alone is wise which is just; that alone is enduring which is right." But since taxation is not right it is not enduring, and since it is not just it is not wise.

Another grave difficulty with expedients is that they becloud principles. In eliminating human slavery in America, it was denounced out of hand as immoral and unjust. No rationalizations were tolerated. If a solution analogous to George's had been advanced, a program for retaining the shell of slavery and confiscating the kernel of profit in slavery would have been proposed. It probably would have been to tax the slave owners for the full amount of the wages which they legally stole from their slaves, less a small percentage to reward them for the cost of supervising the slaves. If such a solution had been advanced, the issue of the injustice of slavery would have been submerged in a wearisome round of arguments on economic considerations. Questions might have been raised as to whether the tax on a slave's wages could be shifted from the slave-owner to those hiring the slaves, similar to the question we wrestle with of whether a tax on land values ca"n be shifted from the landlord to the tenant.

His beliefs that the auction method might result in a needless extension of government is rather surprising. If anything, it would appear that a greater bureaucracy would be required in order to make the necessary appraisals and re-appraisals of assessments which the taxation method would need.

If the land is put up for auction by the local communities at convenient periodic intervals of three, five or more years, the simplest possible practical machinery is involved. No experts are needed to determine assessments. Nobody would care what they are just as no tenant today cares what the land is assessed at - only what the rent is. An auctioneer and a few clerks are all that are needed. Public bidding, insures justice in the long run.

Under the tax proposal, no matter how often one may explain it, people cannot help believing that they own the land they are occupying. Under the auction method there is no question but that the land belongs to all the people and that the present occupants are merely leasing it. In addition, they recognize that they must pay more rent for the more desirable locations, just as they know they must pay higher prices for the better seats in a theater. Wherever the taxation of land values is practiced, no real attempt is made to collect all the economic rent. The maximum end sought is to collect enough to cover the community's budget.

Possibly we should look upon the tax method as a step toward the true solution - the auction method. Thus, in our expositions we should point out clearly that it is merely an expedient we use to help us walk, so the taxation of land values is a crutch, but one which should be discarded as soon as possible.

It might all be summed up in the simple proposition that justice demands just means to attain just ends.