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Tag: land value tax

From the Archive: 1980’s Housing Crisis

This article from the newly digitised (downloadable and searchable) archive of Land & Liberty is an opportunity to analyse proposals from the private house building industry, who, in 1981, claimed to be able to solve the “impending” housing crisis from the supply side. After allowing for a full articulation of the developer’s position, the article concludes that nothing they proposed will solve the housing supply issue (because the land tenure system encourages speculation) save a full land tax.

It is interesting to note the figures involved compared to today. Property developers then argued they could build up to 270,000 new homes, as was achieved in the 1930’s. Today, they argue that the 80,000 they are building this year is something to celebrate! It is also worth noting that the private housing industry has never built more houses than were made in the 1930’s. Even if they did it would be less than half of what is now required per annum (Lord’s Report).

Today, we are in need of yet more houses and no organisation, public or private, seems able to deliver.


Review: “As Evil Does” by Fred Harrison

As Evil Does

by Fred Harrison

Review by Simon McKenna


As Evil Does is designed to raise ire and inform dissent. This polemical style could appear histrionic. Yet it should not be dismissed on this account. Instead, the rationale that informs this method and the result Fred Harrison achieves, warrant serious consideration by all concerned with Henry George and positive social change.

In order to understand As Evil Does, it is necessary to delve a little into Harrison’s intellectual journey as a Georgist. He will be well known to many as a dedicated and successful campaigner, most notably achieving considerable influence in post-Soviet Russia. Yet, despite this, Harrison saw that his and even the combined efforts of Georgists since the 1880s have not achieved their objective. Thus, after many years working to reform economics he wrote,

“I came to realise that there was never a chance of succeeding with the language and strategies that I inherited when I first walked into the London headquarters of the British Georgist movement back in the 1960s” (Homage to Henry George, 2013, Cooperative Individualism)

Two consequences follow from this:

Firstly, Harrison believes we can no longer rely on the inherent reasonableness of the Georgist project winning popular support. Society, he says, is not rational. This controversial realisation came from Harrison’s personal experience. It will immediately resonate with Georgists, many of whom will have been left bewildered by conversations with intelligent friends and colleagues, ‘rational people’ whom they were sure would understand the justice and beauty of public spending funded by a centralised collection of rent. When presented with it however, they either do not see it or they continually invent reasons to object to it. Harrison is therefore no longer concerned to present a merely reasonable alternative. He intends to smash through received notions of progress, property and morality by appealing to a higher human sympathy and a patriotic sense of justice.

The second consequence we must briefly acknowledge is Harrison’s unequivocal rejection of the term ‘Land Value Tax’. The Homage details Harrison’s objection to each of the three words that constitute the term. In sum, he believes it masquerades as a panacea while only obscuring the problem it seeks to remedy. Worse still, it actively prevents the solution from ever being properly understood. It appears therefore that the task facing Georgists is not how to propagandise a reform of tax collection. Since the land question itself is not merely a problematic subdivision of fiscal policy, it is a mistake to make it appear as one. The problem is psychological and cultural. It lies in socially accepted preconceptions regarding property, nature, history and the true value of human life.

Harrison variously describes this phenomenon as if it were a deadly social virus, a parasite and a deadly cult. Over the last several hundred years, it has ruinously “overwhelmed the innate, organic intelligence that informs the culture of free people”. It has created institutions that serve private interests when they should serve the public good. It so governs our thought that we now cannot even imagine the existence of legitimate alternatives. It is fatal and evil because it deliberately consumes human life for unreal economic advantage.

As Evil Does therefore offers activists an array of facts, case studies and moral arguments which reveal the infection. Harrison attempts to awaken the full horror of the malaise before our irrational attachment to what is sick can be replaced with reasoned acceptance of what is healthy. In doing so he traces the complex cultural and psychological history of the British people with our present day socio-economic conditions.

As a virus it manifests as a highly contagious infection that defends itself by encouraging selfish conformism. George Warde Norman, a former director at the Bank of England, is, for Harrison, the example par excellence of a sick citizen. Norman was active in public life as a famous pamphleteer, an active Utilitarian and a founding member of the Political Economy Club where David Ricardo first expounded his Law of Rent. Harrison relates how, Ten years before Henry George was born, Norman had followed Ricardo’s new theory of Rent to its logical “moral” conclusion. Since all taxes come out of rent, a single tax is the most ethical way to fund government.

These revolutionary findings were supported by significant historical evidence available to him at that time. The data showed how, before Magna Carta, 100% of the tax burden rested on the shoulders of the landed aristocracy, completely funding the government. However, since the 1030s, when the right to private enclosure became protected by law, the government could no longer simply demand what it wanted of the Lords’ property. The government could legally only raise revenue by creating sovereign debt and enforcing various kinds of taxes. By 1066-1216, land rent as a percentage of national revenue was already down from 100% to 95%. Over the next 800 years the tax burden was transferred almost entirely from landlords to landless wealth producers. By 1816-1845, only 5% of national revenue was taken from rent. Norman knew a 95% tax increase on the needy and hardworking was economically and ethically unjustifiable. Yet, despite his research, his professed belief in the ‘greatest happiness for the greatest number’ and his power to influence public discourse and public policy, Norman not only kept his research secret, he even published an article in defence of landlords. Norman had no appetite for any significant change because “he was too embedded in the culture of cheating”.

Many of Harrison’s most powerful observations stem from his evocation of man’s naturally profound relationship with the land as the commons and the true meaning of rent. The commons are not merely the shared spaces but the entire phenomena of a culture. It is the “material embodiment of our humanity”, created and shared among people. This holistic understanding of political economy represents an enormous challenge to the orthodox social and economic history of England.

Theorists usually attribute the proliferation of human suffering amidst immense social progress to industrialisation. Harrison argues that, since communities evolve with natural reference with the land, theft of the land is of the deepest cultural significance. This relationship was characterised by vital dependency and natural responsibility. When private interests enclosed the land, the community lost its “sacred income”. Folk culture and natural “common sense” were rendered anachronistic, the social mind debased. The individual was left homeless and isolated.

The uprooted consciousness of the nation was reshaped in accordance with a new culture founded on greed. Co-operative relationships beneficial for all were split-up and destroyed, sacrificed for private, ‘objective’ financial gain. This new arrangement was made possible by new laws, such as The Statute of Merton, which, alongside Magna Carta, “institutionalise[d] irresponsibility”. A title deed was allowed to overrule the profound relation of a people to their homeland. The landlord’s primary responsibility was now to the letter of the law rather than to the people of the earth. The Government’s duty became to protect the incomes of barons and princes. The people were made to pay.

As Evil Does describes how the historic enclosure of England was concomitant to a deliberate reshaping of time. “The timing of marriages, the affirmation of authority structures, the organisation of joyous festivals…were all spun around the rhythms of time that served everyone’s interests.” But all that changed when Land, once appropriated, had to be kept out of public possession. The rent-seeking aristocracy adopted primogeniture, thereby stretching time and protecting their fortunes from redistribution, even beyond death.

Gifted with a guaranteed income from rent, landowning families were able to invest in the financial markets. To better fit the economic demands of this new, extra-geographical marketplace, time, socially understood, was almost completely divorced from the land. Work and leisure time no longer recognised natural regional irregularities such as festivals. Work time took priority over individual characteristics which had allowed people to suit themselves to their callings. “In place of the rhythms of the diversified household economy in rural areas, families were reduced to monotonous mono-cultures.” Harrison evokes the image of a formerly noble people “congealed into clogs and cloth caps” to show how individuals became homogenised, anonymous, interchangeable agents of a ‘work force.’ Individuals were forced into an inhuman organisation where any one man was able to assume the garb of any other and ‘work his shift’, which is to say, instantly replace him. Work was then organised according to the calling of anonymous shareholders. If this was now made to seem almost normal, it was because the British people, the British countryside and time itself had been redefined to serve an abstract economy.

In the intellectual realm, a totalising metanarrative, a “doctrine of social progress” known generally as The Enlightenment, drowned out common sense and made legitimate alternative voices incomprehensible. With no time to spend with family and only an attitude of self-interest to share with neighbours, the spread of anomie was inevitable.

The result is that most people are now simply convinced that the ‘free market’ is the best or most realistic means to happiness for individuals as ‘consumers’ and ‘homeowners’. We have been so deeply infected by a culture of the private individual that even our intelligent acquaintances are apparently unable to accept land as the natural basis of community life. The people have been duped. They are so convinced by their new rights to home ownership and habeas corpus they can not see themselves compliant victims of a fundamental injustice. Harrison should be applauded for his description of this mass dispossession on the national psyche.

Harrison cannot be accused of standing alone on this issue. Hannah Arendt, who sought to understand why totalitarian and imperialist regimes emerged with modernity, found that people had first to be uprooted and separated from their traditional world which upheld natural limits. Enlightenment era imperialism rendered people ‘superfluous’, converted ‘solid property into liquid wealth’ and liberated commerce from any geographical limitation. But Harrison’s analysis is more profound as he grasps the significance of land in a way few other theorists seem capable of doing. He is able in effect to say rent-seeking is as discriminatory and as lethal as Nazism or Stalinism. Whereas the Nazis specifically murdered Jews and Stalin used state apparatus to attack the bourgeoisie, rent-seekers use ignorance of the law of rent to murder the landless.

Harrison insists we are dealing with a condition which acquiesces to the relentless culling of British people. When speaking of economic ideas, he emphasises the ethical. For example, following Joseph Stiglitz, he uses the term ‘rent-seeking’ to describe economies based on private land acquisition. Unlike Stiglitz, he depicts for us its fullest moral import. Rent-seekers profit from exploiting the “life energy” of the landless; rent-seeking is therefore cannibalism. Since it makes its devotees sole beneficiaries, those who murder against reason and humanity, constitute a zombified “killing cult”. Those without land, those at the periphery of the economy, find themselves in the “kill zone”. They can expect to “forfeit up to a dozen years of life so that rent-seeking can flourish.” He says, “It is the wilful intent of a culture that discriminates against a segment of the population”.

Harrison cites many interesting studies to support his views. But what is most striking is not the facts but the philosophic nature of his argument. For while speaking of economic ideas, he brings our attention to the fact that life is not about economics but about happiness.

Some Georgists will be concerned that his emotive rhetorical style lacks the kind of rational legitimacy and dignity they desire for the Georgist project. They would seek to persuade people through explaining the logical cogency of a single tax. For Harrison this is a mistake because it presents our reform as one among many questionable reforms to the status-quo. People are therefore entitled to presume that it will, like any other alternative, have its benefits and unstated pitfalls. The single tax seems arbitrary because in our time reason and logic no longer speak for the beauty of genuine happiness.

A reasonable idea does not compel us to think. A reasonable idea does not have the power to challenge greed. This is because ‘reason’ is a means, not an end. Evil things can also be rationally justified and logically explained. War and mass extermination have been seen as logical solutions to economic problems. Arguments against unjust wars and against rent-seeking are arguments which have to destroy pseudo-rational excuses for inflicting systematic suffering on other members of the human race. They are arguments that reach beyond our admiration for causal validity, speaking instead to our human sympathy. Harrison still hopes our innate sympathy for humanity is repulsed at the sight of undeserved suffering in any other person. It occurs on the level which transcends the logic of self-evident truths and goes beyond legal obligations. The ethical naturally rules the reasonable and cannot be separated from it. Harrison has realised that the best way to help people see these higher truths is to awaken our ethical consciousness.

As Evil Does contains many examples of emotive imagery and moving analogies which appeal to our human sense of right and wrong. Despite our ‘diseased’ state, it seems we still have a very great reservoir of images and analogies to draw from. One of the most haunting images is of Dracula. A gruesome parasite who cheats death, “the cultural vampire… survives on the life-blood of society.” This image of evil better expresses the horrific injustice of a system which sanctifies rent avoidance, than an explanation in economic language.

Are the Crown, Parliament and “middle class homeowners” guilty of willingly cannibalising the lives of their fellow citizens? This fascinating and unavoidable question of responsibility haunts Harrison’s aetiology of Britain’s most life-threatening disease. He admits, “I have to offer the level of proof that meets the tests applied in a court of law… The prosecution has to demonstrate intent.” As Evil Does ultimately forces readers to decide for themselves if ignorance is a valid defence. This defence is given some weight by Harrison’s own view that the disease breeds ignorance. Yet, having awakened our ethical sense, the cumulative effect of the discourse means we arrive at the heart of the matter.

As Evil Does commends itself to British Georgists as a must read. Harrison crams a huge amount of fascinating data and unflinching insight gained from a lifetime’s activism into this compact first volume of his new trilogy. Despite his self-declared split from the “British Georgist movement”, this reviewer finds him to have an eloquent regard for human suffering akin to the Christian ethical concern found in Henry George himself, if with an oratory more vitriolic. Harrison has demonstrated there is much more at stake than can be remedied by a campaign for a Land Value Tax. He has shown why the land question is an ethical problem of ultimate consequence.


First published in Land&Liberty Issue 1236

As Evil Does is published by Geophilos

ISBN-10: 0993339808

Available now: 



Why the rich are getting richer

The New Economics Foundation have recently published a study on why the rich are getting richer. The report focuses on the last two years and looks at both social and economic causes. For those who have studies the writings of Henry George there may be a little disappointment that the authors did not take the trouble to look back at what great writers of the past had to say on the subject and that it is not anything new. On the positive side it looks like nef have reconnected with some of the policies advocated by their founder James Robertson and their recommendations include taxing land values.

Bonkers Land Tax

Land Value Taxation received a good airing in the FT this week. It started with an article by Tory MP Nicholas Boles who wrote a piece entitled: It sounds bonkers but we should embrace a land tax. Boles suggests that taxing land value is usually associated only with those not in the mainstream but he points out how in particular a version of the tax in use in New South Wales works well in stimulating land use.

Two letters appeared later in the week:

Right first time – a land value tax would be ‘bonkers’

From Mr Kevin Cahill.
Sir, Nicholas Boles would have done well to stick to his Conservative instincts and eschew the idea of a land value tax, first proposed in the 19th century when less than 4.5 per cent of the population held all the land of the UK (“It sounds bonkers but we should embrace a land tax”, September 30).
The commonest characteristic of those currently advocating this totally obsolete tax, apart from their peculiar political backgrounds, is that almost none of them know anything about tax, economics and least of all land. Mr Boles excludes farmers and domestic dwellers from land value tax. In so doing he excludes about 80 per cent of all land in the UK. Another 15 per cent of the remainder is road, mountain, bog and moor, so is untaxable. He would apply land value tax, as do most of its advocates, mainly to commercial property, already taxed through business rates. A bad tax would simply be followed by an insane one. And Mr Boles has overlooked that most currently decisive of land value issues, its plummeting price. Land value tax might work if universally applied in a rising market. In a falling market it would simply make any government deficit significantly worse. As your headline writer so elegantly put it, “bonkers”.
Kevin Cahill, Exeter, Devon, UK
and then today:

Who’s ‘bonkers’ about a land tax?

From Mr Geoff Copeland.
Sir, Kevin Cahill ascribes the commonest characteristics of those advocating a land tax as of “peculiar political backgrounds” and that “almost none of them knows anything about tax, economics and least of all land” (Letters, October 4).
I believe that in the past both Sir Samuel Brittan and Martin Wolf have written warmly of this tax in your columns, albeit in a somewhat more comprehensive form than Nicholas Boles MP suggests. Would Mr Cahill regard them as “bonkers”? Or is it Mr Cahill’s political persuasion that informs him?
Geoff Copeland, Woodford, Cheshire, UK
The letters have continued this week:
We already have six land taxes!

From Mr Clifford Lawrence.

Sir, I refer to the article by Nicholas Boles proposing a land tax (“It sounds bonkers but we should embrace a land tax”, September 30) and Geoff Copeland’s letter (October 6) giving further support.

They are too late! There are already six such taxes. They are as follows: business rates (when occupying or even not occupying a property), stamp duty land tax (when purchasing), Section 106 payments (when building on the land), the community infrastructure levy (also when building), corporation tax or income tax (on rental income) and capital gains tax (when selling the land).

How many more taxes are they proposing?

Clifford Lawrence, London SW1, UK

Of course he is right but each of these taxes has its disadvantages. How much more simple and efficient would it be if they we collectively replaced by a tax on the rental value of land falling on the owner.

Let’s find progressive ways to tax the winners in our trickle-up economy

There is a good article by Simon Jenkins in today’s Guardian. It is a response to the letter in the FT earlier this week demanding a reduction in the 50p income tax band. “whenever 20 economists put their name to a letter it is a near certainty that nonsense is being perpetrated.”

Jenkins points out that the claim in the letter that the high rate punishes wealth creation and stifles growth is totally unsubstantiated. The main beneficiaries would be high earners in the financial sector whose reckless entrepreneurship in the past has crippled Britain’s prosperity.

He also points out that this cut would further exasperate the highly damaging trend towards increases disparity between rich and poor and that the more enlightened wealthy are clamoring for high taxation of the rich.

The area Jenkins focuses on is the neglected one of property taxation. He points out that the revenue collected from council tax has declined from 12% to 5% over the last 30 years, and that the differential between the highest and lowest bands is unfairly too small. Property taxes cannot be avoided and, unlike stealth taxes they are paid in anger so there is a demand for accountability.

In the discussion that follows Physiocrat pointed out that the best form of property tax is based on land not buildings and upon the economic rent rather than market price.

Land Value Tax – An idea whose time has come

There is a very good blog on land value taxation at flip chart fairy tales by Rick. It sounds like the author has only recently come across the idea to he puts it very freshly. Te context is the present crisis of public finance and the need to reduce the deficit between public spending and income. It states the advantages and disadvantages clearly and surveys the extent to which the idea has political support. A good discussion follows the blog which contains a couple of videos and a link to a very extensive discussion of taxing land values and the underlying economics on the prison planet forum.

Land Value Tax petition

The Government has re-established its e-petition site. In August a petition was established on taxing land values:

“To introduce Land Value Taxation, an annual tax on the rental value of land, as the chief source of government revenue to replace existing sources of taxation including income tax, VAT and Council Tax.”

It is quite sensibly worded as a tax shift. In fact there are three petitions which not very helpful for accumulating votes but one, created by Peter Smith is collecting the votes and already has over 200. Go on, visit the site and add your name!

Land Value Taxation in the News

Last week the policy strongly advocated by Henry George of taxing land values hit the front page of the British press. [see here] The Sunday Times [not available online without subscription] ran a column by Marie Woolf entitled “Lib Dems want a land tax on rich.” It suggest the Liberal Deomocrats are planning a new land tax aimed at wealthy landowners. It quotes Vince Cable as saying that Britain needed a proper examination about how a land tax could be made to work adding “Government is going to look at this at some point because the traditional tax base is more and more difficult to apply. Income tax for high earners is becoming difficult to enforce. The traditional tax bases have been eroded and land tax is the one thing you can’t take off to Monaco. Business rates would eb the first thing to look at . There are modest changers you could replace business rates with a tax based on the value of the site; then instead of council tax you could have a property tax based on the underlying  value of the land based on an annual basis.” [See here and here for details of how this could be done].

How to Make Britain Grow – The Land Value Tax

In the July issue of the Magazine Prospect Pier Carlo , economist of the OECD, wrote an article on “How to make Britain Grow” offering advice on what the UK can do to get itself out of the situation where economic recovery appears to have stalled. He was broadly in favour of the cuts but argues that on their own they are probably not sufficient. Amongst his suggestions are changes to the tax system. These include a need to link taxation to property values a preferred OECD policy. by Simon Wilson of Moneyweek took up this point in an article on “Should we have a Land Value Tax.” . This is a balanced but  positive article explaining the advantages of the tax. It notes there is a range of support from across the political spectrum. It includes suggestions that taxing land would ensure land is put to good use and also that, by curbing  the speculative element of property prices  it could assist with dealing with the issue of the next generation not being able to afford to buy their own homes.

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