Single Taxers in Progressive Era Minnesota

Rich Nymoen

[2013]

With the MN Legislature recently funding a large University of Minnesota project researching the modern-day application of the work of the Gilded Age economist and reformer Henry George[1] , it is fitting to look back at the efforts in Minnesota of his turn-of-the-20th-century followers, known then as Single Taxers. Author of the world-wide 1880 best-seller entitled "Progress and Poverty," Henry George -- following in the line of the classical economists Francois Quesnay, Adam Smith, David Ricardo and John Stuart Mill -- argued that land and natural resources should be rented out by the community to those holding title to them and the resulting revenue used in place of taxes on wages and production. His was once a household name whose fame was used to sell a brand of cigars, an ad for which can still be seen on the side of a building in Tower, MN (see Figure 1). Single Taxers took their name from Henry George's proposal that all taxes on productive activity should be replaced with a "single tax" on the value of land and natural resources.

The basic principles of the Single Tax program were illustrated in "The Landlord's Game" a Progressive Era pre-cursor to the board game "Monopoly," which was developed by a Single Taxer named Elizabeth Phillips (nee Magie). Under this game's alternative Single Tax rules, individual players were paid rent for any buildings they had on their properties but all land rent for the properties was paid into the kitty and divided among all the players instead of concentrating in the hands of a single winner. Also, once cash in the game's Public Treasury from land rents reached a sufficient amount, it was paid to the holder of the railroads, trollies and utilities for the purchase (through condemnation) of their operations, which were then publicly owned and operated so they could provide their services free of charge.[2] .

In Minnesota, efforts to enact the Single Tax program began in the 1880s. After hearing Henry George speak at the Exposition Building in Minneapolis as a young woman, Maud Stockwell (nee Conkey) became a lifelong Single Taxer as did her husband Sylvanus A. Stockwell, a state legislator representing South Minneapolis and a longtime activist on progressive issues in Minnesota[3] . Sylvanus Stockwell first tried to further this cause as a member of mixed Assembly 805, the Minneapolis local unit of the Knights of Labor.[4] Such local interest explains why, in his address to the Knights of Labor meeting in 1887, District Master T.W. Brosnan of Minneapolis said that the land question was the most important issue before the organization.[5] Also at this time, a Minneapolis branch of the national Anti-Poverty League, which was founded by Henry George and thus connected with the single-tax societies, was meeting in 1887 under the guidance of labor leaders.[6] .

In his article "The Alliance Party and the Minnesota Legislature of 1891," Carl Chrislock reported that several Minneapolis Democrats in the legislature were advocates of the Single Tax and that an attempted compromise on the single tax, which would have left each community free to use it for its own financial needs, failed miserably that year.[7] Carl J. Buell, another prominent Minnesota Single Taxer, had joined Stockwell in petitioning the MN House in 1891 on amending the state constitution to permit the exemption of personal property and improvements on land from all taxation. In 1894, Chrislock reports that disagreements existing within the Alliance Party found some party members wanting to commit to the single tax while others branded Henry George a heretic for wanting to reform the free enterprise system instead of scrapping it altogether.[8] Undaunted, Stockwell in 1899 introduced (again unsuccessfully) a bill giving cities a local option on taxation, including the adoption of the single tax system.[9] .

On February 12, 1900, the National Antitrust League held a key meeting in Chicago attended by Minnesotans Rev. S.W. Sample, Ignatius Donnelly, Sylvanus. Stockwell and C.J. Buell. There Reverend Sample orated that the land monopoly could be removed by the single tax and the transportation monopoly removed by public ownership of railroads.[10] Then in 1901, Stockwell proposed (unsuccessfully yet again) a state constitutional amendment authorizing the legislature to collect sufficient revenue for all state and local purposes in accordance with a land value tax system while also authorizing adoption of the system of home rule in taxation.[11] .

In 1906, Stockwell founded the Municipal Ownership League of Minneapolis, which advocated that the city purchase the gas company's plant after the expiration of its license in 1910, a proposal patterned after Milwaukee's municipal gas plant; the League also planned to regulate street car rates.[12] The popular Democrat governor John A. Johnson, at a public event of the League held at the Minneapolis Auditorium, spoke in support of municipal ownership not only of the gas plant but also the street railway, the telephone system, and the lighting plants. He reasoned that costs to the public would go down, efficiency would increase, wages of utility employees would increase while their hours would decrease, strikes and labor difficulties would be eliminated or reduced and, finally, that "graft, corruption and boodle" would be abolished.[13] .

The culmination of the Single Tax movement in Minnesota came as a result of Buell traveling up and down the state urging the ouster of legislators beholden to the mining industry who opposed the placement of a tax on iron ore before it was shipped east; because iron ore is a natural resource, Single Taxers viewed that its value belonged to all Minnesotans rather than just the mine owners. In 1921, the legislature adopted Buell's proposal of taxing the ore's value at the mouth of the mine less the stipulated costs of bringing it to the surface. This came to be known as an "occupation tax" and it was equal to 6% of the valuation of all ores mined or produced. His parallel plan of taxing royalties received by owners of mining properties passed in 1923.[14] .

Despite these later achievements, Minnesota's Single Tax movement could not long outlast the end of the Progressive Era in Minnesota. This came with the 1918 election that fractured - through the loyalty-questioning of progressives by Minnesota's reactionary Public Safety Commission and conservative press -- the old bi-partisan coalition of moral reformers, small-town business owners and professionals, and farmers.[15] No doubt the Single Taxers who were part of that coalition would have been pleased at the prospect of leading Minnesota institutions reconsidering their proposals a century later.