When Will Land-Value Taxation Be
the Law of the Land?

Alexander M. Goldfinger

[Reprinted from The Gargoyle, February, 1961]

A few years ago, numbers of the workers for land-value taxation felt discouraged that, inspite of the logical simplicity of the extension of equality of opportunity offered by the adoption of land value taxation, the prospects of its becoming law were very slim or far distant in time. The reason for this was the growing trend of public desired to impose more and more obligations upon governments, national, state and local.

To do this, governments needed more and more tax revenues;, and resorted to sales taxes, income taxes and excise taxes to meet the demands.

Most discussions of the means to raise additional tax revenue centered upon two main contentions: that ability to pay and relief of the_ tax burden on homeowners should control any new revenue raising legislation.

Most of the states and many municipalities now collect income and sales taxes. It must be apparent to all serious thinkers that the graduated income tax serves, not only as a source of revenue, but as a social leveller, attempting to equalize incomes. It must be apparent, even to those who misconstrue the time hallowed concept of true liberty and a good life, the ability of every man "to sit under his own vine and fig tree -- with none to make him afraid" that for the state to forcibly take from some and give to others may have unwelcome consequences.

Evidences of this are found in the so called "task-force report" made by Professor Samuelson, economist at the Massachusetts Institute of Technology to the new administration, in which report, Prof. Samuelson advises that if economic conditions become worse, 3 or 4% of the income taxes paid by individuals should be remitted so that the purchasing power thus released will increase the effective demand for goods and thus stimulate production and employment. A serious thinker must, from such advice and reasoning deduce the corrolary, that for the state to take from individuals the wherewithal, to satisfy desires must decrease the effective demand for goods, decrease production and employment. Of course, the argument goes that government will spend the taxes or armaments, roads, etc. and thus the purchasing power of the tax money will enter into the economy with only a change in the kind of goods being purchased. If this argument were valid, then a remission of taxes to individuals as advised by the task force report would have little effect upon the economy and would be futile.

The author of the task-force report, Prof. Samuelson, is the same economist who advocates the Keynesian remedy of government spending, even deficit spending, to remedy a business cycle decline and also believes that a constant inflation of the purchasing media up to 3 or 4% per annum is a proper price to pay for "full employment." Yet even he now advises that a remission of personal income taxes up to 4% will be beneficial to the economy. One wonders why he limits the remission to 4%.

There are other evidences that the time may be shorter than we believe when the fallacies of present tax methods will be widely understood and remedied.

The fear that creeping socialism so evident a few years ago would gain adherents or be resignedly accepted and thus force us to reap the bitter harvest which a similar regime caused in Great Britain, now shows signs of abatement. The recent election, while not a clear choice to the voters of a private enterprise versus a government intervention economy, still had some interesting and significant signposts as to future ideology. The Republican platform and candidate were clearly not outright advocates of a free-market economy, but they certainly did not contemplate the amount and degree of intervention by government that the Democratic platform and candidate did.

The closeness of the vote, while it may be partially explained by emotional factors, certainly was some evidence that the pendulum swinging towards more and more intervention and paternalism may have reached or nearly reached its limit and a reverse action may have gained a start.

The avowed representative of the conservative view, Barry Goldwater, showed that his influence and followers were greater than had been credited prior to the campaign for election. Goldwater did make clear the conservative view that the Welfare State concept will bring dire results. He did not seek popularity by mouthing generalities, but forthrightly stated what heretofore had been unpopular views. He was not a "middle-roader." And yet he found supporters in all parts of the country. Recently, in a publicised statement, he noted that there is a "conservative swell" of adherents that is clearly discernible "west of the Hudson River." Perhaps, then, the trend to more paternalism is at its crest or is waning.

The article in House and Home, "widely read, caused much favorable comment by writers in other periodicals including U.S. News and World Report and Human Events. It is apparent to many that the feared trend to a paternalistic managed economy has lost its vigor and that in seeking other means to remedy the unbalance in our economy, the danger of the high cost of land is not the least of the problems for which remedies or solutions must be found.

From the fact that the economy of West Germany has had an increase in productivity over the past ten years of over 8% per annum while in the United States the increase in productivity has been at a rate less than 3% causes serious thinkers to find the reasons. When it is demonstrated that in West Germany, the trend has been toward a free-market, economy less paternalism by government, with convertible, non-inflationary currency, many thinkers draw their conclusions that thus are the maximum material, human desires satisfied.

First, before a trend develops, serious thinkers must determine cause and effect relationships. Next, articulate thinkers must acquaint others through the mass media so widely used today. Then when it becomes apparent that respected serious individuals are willing to first admit and later to espouse a correct diagnosis of conditions and a probable remedy for them, the trend has started and will gain momentum.

It may well be that the astounding fact that in many of the colleges and universities a poll of the students made during the pre-election days showed a majority of them favoring an individualistic rather than a paternalistic security-minded course as most desirable, betokens a new day. A few years ago, both the faculties of the universities and most of the students were advocating a shift to more and more government intervention and control of their futures. Now, the students are ahead of their faculties in reversing the trend.

So, it may well be that the pessimism which prevailed a few years ago about the possibility of remedying the economic woes, not only in this country but in the places where poverty and starvation are more apparent, need no longer prevail. By continuing to make clear the cause or causes of business cycles, unemployment, want and poverty and the simple logical way in which the major cause can be treated by adoption of land-value taxation, we can each swell the growing trend to reverse the illogical actions of the past.

Take hope, all ye of faint heart? You will be on the winning team yet.