Land Law and the Constitution
in a Civilized Society

Kenneth Jupp

[A paper presented before a Congress of the Russian Duma, Moscow, April 1996]

ABOUT THE AUTHOR: Sir Kenneth Jupp joined the Army as a field gunner and was awarded the Military Cross (1943). From 1958-1975 as Queen's Counsel he appeared in Parliament to advise MPs on Private Bills. In 1975 he was appointed a Judge of the Engtish High Court. He retired in 1990.

THE COMMUNIST experiment has left Russia with one priceless inheritance. You own your Motherland - - every hectare of it. This is unique in the Western world. In no other country is the land owned by the state except in England, where the Crown is theoretically the legal owner of all the land. However, "free-holders" from the Crown, having over the centuries ceased to pay rent to the government, now buy and sell the future rental income from the land as if they were owners.

In Russia the land is state-owned by law, implying a duty on the government to administer the land for the benefit of the whole people. If a land code is adopted which ensures that the government honours this sacred trust, Russia will have an advantage over other countries in both economic justice and economic power. This is a tremendous challenge. How to share out the land?

Men of genius -- religious leaders, philosophers and statesmen -- have for millennia recognized that a nation's land is the birthright of everyone in the community, and that each individual should enjoy an equal share in the benefits. But attempts to bring this about have always come to nothing. Throughout world history constitutions have abolished slavery, and secured political freedom. But one essential freedom is still lacking -- the freedom, for every individual, to have access to land to live on, and land to work on. What is the result? Even in the richest Western nations there are beggars in the streets. Why? Because the land is closed to them unless they can buy it. There is plenty of land. But the best of it is privately owned, and can be kept out of use for decades while owners seek the price they want. Those who do not have the means to buy are then dependant on public 'welfare', the expense of which is crippling the Western nations.

The difficulty is that land cannot, except in primitive societies, be divided up into shares of equal value. But in advanced societies that is not a problem, because land-rent can be divided up. Sharing land-rent, which is the natural revenue of the state, has been canvassed among serious writers for some time. In Russia Tolstoy urged it upon the Tsar. And land-rent paid to the government as public revenue makes it possible to ease the crushing burden of taxation.

The Land Code in its present form merely cuts up the land. Those lucky enough to get a bit of it to buy and sell will trade that land for its rent, and some of them will get rich. Everybody else will be robbed of his or her share of the inheritance, and will probably remain poor. This is a constitutional problem which has not been solved in the modern world. Take England. There was a tremendous land hunger in the 16th century under the Tudor monarchs: population 3 to 4 million. There is a land hunger now: population 50 to 60 million. There are beggars in some of our city streets now. The roads of Tudor England swarmed with beggars. To deal with them the Tudor parliaments passed laws which resulted in the Poor Law Acts from which evolved the Welfare State of to-day -- a bandage on the wound of poverty, which does nothing to cure the wound.

It is not much comfort that the Land Code proposes a tax on land. The fatal flaw is that it sanctions private ownership of the capitalised rent (the "buying price" of land), and the right to buy and sell land. This means that you are prepared to go the Western way, with millions of Russians unemployed who will have to live in degrading dependence on state welfare. Is this what you intend? It is certainly what the Land Code hi its present form will bring about: and the Motherland will cry once again for the children it will be prevented from feeding.

Your lawyers should not rush. To judge whether the Land Code meets the needs of the people, and safeguards their precious heritage, you should ask for answers to these questions:

  • Will the benefits from buying and selling land be enjoyed by everybody in Russia?
  • Will these benefits be available for future generations?
  • Will land be available for any individual who is willing to pay the government rent equalling the current annual value of the land?
  • Will land continue to be available on these terms for future generations?
  • Will future citizens share the benefit of any natural resources such as coal, oil, precious metals, industrial diamonds etc. which may be discovered after the land is privatised? Will other materials which scientific discovery may unexpectedly make valuable still belong equally to everyone? Yesterdays barren desert land can become to-days rich oilfield.
  • After the use of the land is changed through planning permission, for example from agricultural to housing, or for building a factory, will the resulting increase in value be shared by everyone?

The present draft of the Land Code fails these tests. It will throw the Motherland to the jackals. It should not be rushed through the Duma. Get it wrong and you take Russia into all the troubles now facing nations in the West. Get it right and you give an example of good government to the whole world.

This is the philosophy behind these questions:

The land is the inheritance of its people. This inheritance must be preserved all generations to come.

  • The government must provide a practical mechanism for expressing this: otherwise freedom is a meaningless concept.
  • Every individual must have land to live on and work on. Without land we die, or are enslaved to the will of others dies.
  • Individuals need possession of land, not ownership of the rent of land. The law must guarantee secure possession to every land-holder, and protect him against any interference with his use of the land he holds. Interference by government, or its bureaucracy, should be subjected to severe legal penalties.
  • Everyone should pay for the benefits he receives. In terms of land, he should pay the true rental value of the land. Values of rural hind rise according to fertility, and the availability of minerals, neither of which is man-made.
  • The surrounding community adds value to land, making it suitable for houses, or shops, or offices. Those who possess land should pay for the value the community creates.
  • If all pay rent appropriate to the location of the land, and its command of natural resources, then competition in the market will be fair. No-one will have any advantage over anyone else save such as is given by his skill and intelligence; and each will obtain what he fairly earns.

The rights to the -wealth created by the individual should be guaranteed:

  • Improvements made in and on the land by a person's labour and the investment of his savings (capital) belongs to that person, and the law must protect the owner's right to use and to sell the improvments when he gives up his land.
  • With the inflow of land-rent to the government, there should be a corresponding reduction in the tax burden on incomes people earn.

The Russian people can learn one salutary lesson from the former aristocracy on whom they turned the tables in 1917. A clever landlord never sells land. He always lets his land to maximize revenue; and always provides for rent reviews at frequent intervals. This is the secret of a prosperous and fair society -- but only if the rent is shared equally among all citizens.