Why The Idea Of A Single Tax Refuses To Die

Startling fact: There is a radical 150-year-old economic reform movement with California roots that refuses to die. A group of underdog reformers are fighting a David vs. Goliath battle over the concept of a single tax for America.

“Let’s face the facts,” says Edward Dodson, a faculty member at the Henry George School of Social Science in New York City. “Existing macroeconomic theories do not explain why we continue to experience cycles of boom and bust.”

According to Dodson, the most urgent economic issues facing us today, such as the affordable housing crisis, can be solved by the policies proposed by Henry George, a 19^th century progressive economist who proposed a single tax on landowners.

George argued that a single tax on land values would create a more productive and just society. Eliminate income tax, sales tax, and tariffs; just impose an annual charge on land equal to what the land would yield if offered under a lease.

As the same time, argued George, remove the tax burden on the value of actual private property (such as our homes and other buildings). Such a system of public revenue could protect the most vulnerable from the fluctuations of the industrialized economy. He used terms like the 1% as the beneficiaries of privilege under the law and the haves and have nots.

One Tax To Rule Them All

Every single major economist from Adam Smith to John Maynard Keynes to Milton Friedman believed that land value tax was the most efficient and fair form of taxation.

“Milton Friedman in a lecture once said, ‘I know you’re not going to believe me or understand this, but the least bad tax is Henry George’s proposed tax on the unimproved value of land,’” said Dodson in a recent video conference interview.

The non-degree granting Henry George School of Social Science was launched in 1932 to share George’s presentation of the science of political economy and his solutions to pressing problems through education, economic research, and policy efforts.

Dodson has been a member of the school’s faculty since 1981. He held various management positions in financial services, with the last 20 years at Fannie Mae before retiring in 2005 to focus on teaching about the economic philosophy of Henry George, who argued that the economic value of land (including natural resources) should belong equally to all members of society.

‘”Henry George’s analysis is the only one that really explains how our system operates, why our economic system is subject to our sociopolitical arrangements and our institutions,” says Dodson.

Dodson contends that tax policies drive the boom and bust cycles.

“That’s because our economists have ignored the land question,” he adds.

Who Exactly Was Henry George

George, an American political economist and journalist who lived from 1839 to 1897, was immensely popular in 19th-century America and sparked what became a loosely connected global reform movements during the Gilded Age.

Born in Philadelphia, he moved to San Francisco to find his fortune in 1858. He found poverty instead.

“There he gradually concluded that high urban rents were consuming all the gains of industrialization,” states The Encyclopedia of Greater Philadelphia. “He came to believe that increasing population and demand for natural resources caused the value of the world’s finite stock of land to increase in value, skewing wealth toward the elite, even when owners did nothing but idly hold their property.”

His most famous work, Progress and Poverty, was published in 1879 and sold millions of copies worldwide. The book explores the use of rent capture such as land value taxation as a remedy for social problems.

California Was At The Forefront

“There was an effort back in the early 1900s called the Great Adventure where they tried to get a referendum passed by the voters in California to adopt the so-called single tax,” said Dodson. “In other words, eliminate all taxation except the tax on economic rent of land.”

The political arm of the Henry George movement largely fell apart. Those who thought that public awareness was important founded the Henry George School of Social Science during the Great Depression.

“They even recruited John Dewey, the philosopher, to be the first honorary president of the board,” said Dodson. “They tried to rebuild the momentum for George’s ideas through education.”

If I Could Go Back In Time

If Dodson had a time machine, he would go back to the late 1800s to get George to drop politics and embrace academia.

“So, I blame Henry George, he should have stayed out of politics,” says Dodson. “He was offered a faculty position at the University of California Berkeley as a professor, and he didn’t take it. But if he had taken it, he would’ve been teaching the first generation of trained political economists that embraced his ideas.”

Dodson says his students at Cal would’ve earned PhDs, gotten faculty positions in colleges and universities, and taught the next generation and then that generation teaching the next generation.

But alas, that scenario did not come to pass.

“We’ve been fighting in the backwaters of economics ever since,” says Dodson.

Which Party Might This Appeal To

Dodson is encouraged by the number of Gen Z, Millennials and Gen X individuals interested in George’s ideas, but he is not encouraged that any current political party will embrace these ideas yet.

“There’s a left-oriented group that believes that when you collect the economic rent, it should remain mostly with government, and government should have the responsibility for doing whatever is necessary to provide full employment and a robust social welfare system,” says Dodson. “There is a right-oriented group that also argued for collecting the economic rent, pay for limited government services, then distribute the remainder as a citizens’ dividend or universal basic income.”

Dodson does not believe conservatives will adopt the George single tax on land idea.

“I think the conservatives fear Henry George a great deal,” says Dodson. “That is because the conservatives largely believe in the uncontrolled accumulation of property, and therefore any attack on property in land value is an attack on their core belief system.”

If you want an author blurb:

Henry DeVries is the author of 20 books and is the publisher and editor-in-chief of Indie Books International in Oceanside, CA.

Henry DeVries, Special to California Business Journal