Progress and Poverty

To fully appreciate the impact of land taxation in lieu of other types of taxes, George must examine wealth distribution. Once capital and labor are no longer suffering from the burden of taxation, as it is instead applied to land rent, rent would “promote equality” where it once caused inequality (438). Every wealth-producing community would be able to split its wealth into two parts. One portion would go to individual producers as interest and wages. The other part would be used to benefit the entire community.

Using taxed rent on public initiatives would essentially abolish private land ownership. The result of this measure “would be to destroy the tendency to an absolute decrease in wages and interest, by destroying speculative monopolization of land and the speculative increase in rent” (440). Capital and labor would gain from this measure in two ways. First, they would no longer be taxed. Second, they “would gain by the positive decline in rent caused by the decrease in speculative land values” (440). As a result, all social classes would become richer, and new employment opportunities would arise. Paradoxically, once people stop fearing poverty, “no one would desire great wealth” (443).

At first, the proposal to tax only land will frighten the owners of small farms and other types of small landholdings. However, even in the case of large landowners, they “may lose relatively, yet even in their case there will be absolute gain” (445). Gains from production for labor and capital will be so substantial that they will benefit the entire community, including landowners.

Of course, the first recipients of this restructuring would be the wage earners as well as storekeepers, manufacturers, and merchants. Since working farmers both own land and perform labor, such farmers will gain significantly as laborers, while their losses would be nominal. Indeed, many landholders also perform labor.

Wealth redistribution is another important element. It will be distributed not in the same amount but considering each person’s different skills, knowledge, and overall contribution “to the common stock” (450). As land monopoly disappears, people’s fortunes would be based on their labor. Thus, large fortunes will disappear as well, “for when everyone gets what he fairly earns, no one can get more than he fairly earns” (451).

Society will transform for the better by removing land monopolies. The government may become simpler, no longer needing the bureaucracy to collect different taxes and punish tax evasion. Indeed, key branches of government—including executive, legislative, and judicial—will be “vastly simplified” (453). There will be fewer land disputes, and public debts would disappear. Standing armies might disappear, “aided by the progress of invention” and human intelligence (453). In general, “[s]ociety would thus approach the ideal of Jeffersonian democracy, the promised land of Herbert Spencer, the abolition of government” but only as a form of control (453).

Socialism may be achieved, as the abolishment of private land ownership will “remove want and the fear of want, [and will] give to all classes leisure, and comfort, and independence, the decencies, and refinements of life, the opportunities of mental and moral development” (468). Human nature is complex. It combines self-interest with higher moral qualities. These moral qualities allow humans to conceive of a society that is superior to the one of today. In a society in which want is abolished, such moral qualities will prevail. In turn, the human desire for exploration would lead to further scientific discoveries and technological advancement.