Is Marxism or Land Value Taxation True Land Reform?
Ralph W. Borsodi
[Reprinted from Equal Rights, May 1987]
Your editorial "Decrying Marxism" is enough to make my old
friend, Wolf Ladejinski, turn over in his grave. Wolf worked for land
reform for over two decades in Asia; he knew full well that one cannot
work with Marxists on land reform.
The Marxists espouse the principle that any means is justified in
pursuing the end of the Marxist utopia -- the classless society. The
barbarities the Marxists have committed in the 20th century against
people who disagree with them compare with the worse of the religious
inspired barbarities of the preceding centuries. The Marxist have been
particularly vicious in their treatment of people living on the land.
What puzzles me is how one can tie the mid-l9th century ideas of Karl
Marx (an urban intellectual elitist) into land reform issues in the
United States at the end of the 20th century. I wonder what kind of
land reform "Equal Rights" is really espousing. How
specifically do its policies tie in to keeping small farmers on the
land, to keeping the poor and elderly in their homes, and to extending
land ownership to those who wish to own farm, suburban or urban land.
I find your editorial statement that the ruling elite in the country
are the landowners in conflict with the reality I know. The landlords
have no little voice in government -- particularly in local
governments--but the elitist ruling powers in the United States have
been for the better part of this century in the hands of
industrialists, financiers, the media, academia, the church, organized
special interest groups, and a complex of industrial and military
Post World War II city landlords have often been wiped out in
decaying urban centers. The government has been subsidizing suburban
development. Economists should carefully consider the significance
that people do not rush to live in these abandoned urban areas. Large
areas of the Bronx in New York City have remained depopulated even
though land could be obtained at nominal costs. Landlordism, or
monopoly in land holding, cannot be considered country's only economic
problem, which if broken up, leads to utopia.
In the meantime if we accept land as a transferable commodity one
must face the fact that if it is proposed to tax unearned gains away
from lucky landowners one ought to compensate unlucky landowners for
losses. (When communities decay land values fall.) Taxation policies
should be equitable.
I do not understand what kind of land reform you are advocating. You
seem to be realistically pursuing higher tax rates on urban land,
which up to some level of taxation may encourage the use of urban
land. Tax policy may then be a tool for preventing land being kept out
of use or for promoting urban renewal. However, if the landowner can
find no economic use of the land at a given level of taxation, he will
simply abandon the land to the community.
You seem to be generally silent on the reform of taxation of farm
property and on farm land holding. If you were to raise taxes on farm
property (to discourage holding land out of use) small farm owners
would be forced into bankruptcy in larger numbers than at present.
Farm property values in many farm areas have been deflating. Farm
produce in many areas cannot be sold for its cost of production. The
issues of farm policies are complex. In many areas we ought to stop
conversion of farm land into commercial use because of the water
run-off and other ecological concerns.
What Kind Of Land Reform?
The taxation of suburban homeowners and commercial users interplays
with the same policies in urban areas, affecting population shifts. I
should be most skeptical that some simple tax formula will solve the
problems created by the great concentration of the population of the
U.S. along its coasts.
Your recent editorial and previous issues of "Equal Rights"
have left me with a confused feeling as to what kind of land reform
you are really pressing for. You seem to be generally pursuing the
Georgist orthodoxy that the single tax will (in ways unexplained by
you or Henry George) create an economic Eden at any time under any
society and under any organization of economic activity. How the total
tax requirements of all levels of government will be reorganized -- a
most critical matter -- is left totally to the imagination. Economists
cannot ignore questions as to how we can support government at all
levels and what are the effects of our tax policies.
Obviously, I have strong feelings on the need for land reform, else I
would not be writing you. However, I am skeptical that the advice of
Karl Marx or that of Henry George is going to move us much down the
road as we move into the 21st century. I am always willing to listen,
but I believe that we have to be specific about land reforms in the
way land is currently held and used--if we are going to get anywhere.
Generalities dating back to the age of Quesnay will not serve us.