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Written by: Kamran Mofid

Published: 03 October 2017

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Saint Augustine

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“Despite the drawbacks to the pessimistic Augustinian view, however, its overall themes need to be addressed. Augustine’s pessimism is comforting in one way: he shows that our political structures are by nature imperfect, and therefore their failures are not caused by something of our own specific doing. On the other hand, admitting that human flaws preclude creating a political utopia fundamentally changes the posture by which one approaches the political realm. Without the burden of achieving institutional perfection, humans are free to pursue justice and peace within institutional deficiency. For the Christian, this means first and foremost focusing on the character of persons that comprise society. Augustine’s work, understood alongside the political ideology of Niebuhr, argued that the quality of society depends on the character and the nature of the people who compose it. They help us realize that the key to peace and justice, however imperfectly they may be realized, has to come from the good will of individuals. Indeed, if human character hinders society, it can also improve it. It therefore makes sense that Christ left no instructions for a political system. He did, however, instruct us to “love the Lord your God with all your heart, with all your soul, with all your mind, and with all your strength” and to “love your neighbor as yourself.” Properly living out these principles may not create the perfect society, but the Christian message assures us that it will create a virtuous one.”

“The tragedy of man is that he can conceive self-perfection but cannot achieve it.”-Reinhold Niebuhr

Why States Fail: Lessons from Augustine

By Jeffrey Poomkudy. This article was first posted in The Veritas Forum on 7 September 2017

Reinhold Niebuhr, a theologian and intellectual, once opined that “the tragedy of man is that he can conceive self-perfection but cannot achieve it.”1 Even though humans can envisage and conceptualize a perfect society, human existence appears to be a narrative of fallen kingdoms and empires. Although we have improved our systems of government and have developed inclusive declarations of human rights, perpetual strife and conflict remain. Problems of justice rear their ugly heads in different forms, causing discord in every century. In the grand scheme of human history, civilizations bear an uncanny resemblance to the humans who built them: beautiful, yet deeply flawed; brilliant, yet persistently ignorant; innovative, yet remarkably short-sighted. Human civilizations are simply that—human. Understanding the nature of human societies requires a reductionist approach; this involves examining the nature of their simplest units: the individuals that compose them. There are certain qualities that bind persons together and define human nature. If we can ascertain our nature, we can begin to understand what makes societies perpetually problematic.

Augustine of Hippo, a 4th-century Christian theologian and philosopher, gives an intimate and explanatory account of human nature from both a theological and personal perspective. While he chronicles his struggle with sin and his conversion to Christianity in his magnum opus, Confessions, it is in De civitate Dei, or The City of God, that Augustine gives us insight into the imperfection of human societies. He wrote The City of God in response to pagan claims that the capture of Rome in 410 CE was punishment for Rome’s conversion to Christianity.2 Rome was seen as a city that would last forever and where human perfectibility was an attainable ideal.3 In The City of God, Augustine posits ideas regarding human nature and original sin and explores the nature of politics. It is helpful, then, to look at the framework of Augustinian political thought to provide an explanatory account of our human nature and its relation to our stubbornly flawed political systems.

Augustine’s political philosophy is built on the idea that we cannot create a perfect political order here on Earth because human nature is inclined toward sin. Politics is largely motivated by a lust for power or rule, a libido dominandi, that results in a constant struggle for power.4 This forms the basis of the City of Man, or the Civitas Terrena, his conception of our human society, which can never attain perpetual peace or lasting justice. The City of God, or the Civitas Dei, on the other hand, is a place of perpetual peace and justice, but is only attainable in the next life. It is there that divine law would reign supreme. It is important to consider these ideas in more depth to understand whether Augustine’s sociological analysis is accurate, what implications it has for a Christian worldview, and what it means for us today.

The most fundamental part of any political system is the individual. Our political systems are reflections of us, and it is important to understand what we truly are. Augustine attributes our nature to the Fall of Man, or Original Sin. In the Christian tradition, Original Sin is man’s turning away from God “and making his own will and desires the center of his existence.”5 Due to Adam and Eve’s rebellion against God, human nature was ontologically changed; it became marred by concupiscence.6 Concupiscence, the core of our fallen nature, is defined by the Catechism of the Catholic Church as “the movement of the sensitive appetite contrary to the operation of the human reason.”7 Put simply, concupiscence is our inclination toward that which is sinful or evil, in direct opposition to our faculties of reason. Concupiscence itself is not a sin, but rather inclines humans toward it.8 From a theological perspective, concupiscence is a battle between our spirit and our bodily inclinations. Augustine writes that it is only through God’s grace that one can overcome concupiscence.9 Augustine also appealed to everyday experience to demonstrate the existence of concupiscence. After all, it is easy to be forgetful, lazy, or ignorant, but it is far harder to be attentive, hardworking, or knowledgeable.10

Augustine argues that because of concupiscence, we are a condemned lot, or a massa damnata, which renders us forever dysfunctional.11 We are by nature selfish due to concupiscence—naturally inclined to pursue our own ends. On the political scale, we wield power to achieve those selfish ends. Augustine contends that the state of political systems is therefore marked by the human lust for domination or power. Political systems are simply power struggles among groups vying for domination. We, too, in our own lives want to be powerful in every regard, however slightly: we desire to be stronger, more respected, and more successful than those around us. We are inclined to detest those that are better than us and envy those that have more than us; all of these are results of concupiscence. Since society is a collection of individuals like us, then society is a reflection of the predilections of the masses. If we are inclined to desire power, respect, and our self-interest in our daily lives and relationships, our political systems cannot be expected to resist that urge to dominate. For example, when considering our noble beginnings in the United States, we tend to brush aside the brute power hunger that characterized our treatment of Native Americans, the policy of Manifest Destiny, and our 18th-century imperialistic tendencies. Even in democracies, power subdues and conquers when wielded by the majority. Today, individuals in Congress continuously utilize unwavering obstructionism to maintain power for themselves and for their party.

In addition, concupiscence corrupts our virtues by providing ulterior motives for action. Niebuhr notes how humans have a unique ability to pursue power under the pretext of caring for others:

…men are inclined to take the moral pretensions of themselves or their fellowmen at face value; for the disposition to hide self-interest behind the façade of pretended devotion to values, transcending self-interest is well-nigh universal… Man is a curious creature with so strong a sense of obligation to his fellows that he cannot pursue his own interests without pretending to serve his fellowmen.12

The people who reject their self-loving, power-seeking nature and truly work for the common good are praised, and rightfully so, for their nobility and dedication to an ideal higher than their lives. But the harsh reality is that, taken on the whole, our concupiscence makes us selfish and power-hungry, translating to power struggles on a political scale.

The concept of concupiscence in relation to the imperfection of political systems and the idea of the two cities were analyzed and synthesized in Niebuhr’s book Moral Man and Immoral Society: A Study in Ethics and Politics. Niebuhr claims that although individuals can overcome their tendencies toward concupiscence (as Augustine would say is possible through the grace of God), large groups cannot do so. In essence, large groups will not be able to resist the impulses of concupiscence because of the impossibility of “establishing a rational social force” that can withstand natural inclinations.13 Societies are products of a collective egoism, a more amplified and more powerful egoism than that expressed by individuals.14 Niebuhr explains that “in every human group there is less reason to guide and to check impulse, less capacity for self-transcendence, less ability to comprehend the needs of others, therefore more unrestrained egoism than the individuals, who compose the group, reveal in their personal relationships.”15 Just as a team is only as good as its weakest link, a society too is only as good as the character of its weakest people. The ideas of Niebuhr’s books form the basis of the political idea now known as Christian realism, a political doctrine that has influenced multiple politicians in America from both sides of the aisle, including John McCain and Barack Obama.16 Christian realism claims that, as Augustine argued, a lasting and just political system reflective of God’s kingdom could never be established here on Earth because of the innately disordered tendencies of societies, which in turn came from the inability to resist the collective forces of concupiscence. In other words, the Civitas Dei, or anything that reflected it, was not possible. This was in stark contrast to the liberal idealism that was in vogue during Niebuhr’s time. Liberal idealism, adopted largely by Woodrow Wilson, claimed that human nature was intrinsically altruistic and that violence and other deplorable behavior was not the product of humanity’s flaws but rather evil institutions that promoted selfish action.17 It held that war, too, was not inevitable and could be reduced greatly by moral institutions.18 Wilson’s League of Nations arose out of this idea, and American exceptionalism is firmly planted in it. Niebuhr’s realism was the antithesis of liberal idealism, planting Niebuhr against the idea of human perfectibility. Indeed, historian Arthur Schlesinger Jr. wrote of Niebuhr:

[His] emphasis on sin startled my generation, brought up on optimistic convictions of human innocence and perfectibility. But nothing had prepared us for Hitler and Stalin, the Holocaust, concentration camps and gulags. Human nature was evidently as capable of depravity as of virtue. Niebuhr made us think anew about the nature and destiny of man… Ordained authority, he showed, is all the more subject to the temptations of self-interest, self-deception and self-righteousness. Power must be balanced by power.19

So, for those who accept the ideas of Augustine and Niebuhr, what is the right course of action? Augustine would say that any true believer in the City of God can only be a sojourner in the City of Man. Jesus Christ himself said, “My kingdom does not belong to this world,” and, “Repay to Caesar what belongs to Caesar and to God what belongs to God.”20 St. Peter echoes those sentiments, saying, “Be subject to every human institution for the Lord’s sake.”21 Augustine therefore argues that Christians must merely submit to their broken political regimes and not interfere with the government of the world, which imitates Christ’s tolerance and submission to earthly-ordained power. They should instead live intently for the City of God, where glory will come from God alone and where there will finally be a perpetual peace.

Taken as a whole, the ideas of Augustine provide an explanatory account of broken political systems throughout history. His account of human nature and the implications of his view, however, are highly pessimistic. Augustine minimizes the ability of humans to do good and combat concupiscence without God’s help. He is caught in a bind between a Manichaeistic view, which held that humans were by nature evil, and a Pelangianistic view, which argued that humans were free from the guilt of original sin and could attain moral perfection without divine help.22 Augustine’s view of human nature through concupiscence, though accurate, is influenced by Manichaeism, the school of thought to which he adhered before converting to Christianity.23 Likely due to this influence, he argues that humans need God’s grace to overcome our depraved nature and do good. This view, however, is hard to defend without falling into determinism. It is a contradiction to contend that we have both free will and the inability to choose to do good without the grace of God. Though concupiscence exists and weakens our free will by inclining us to sin, it is central to Catholic theology and divine justice that humans have the ability to do good from their own free choosing. To know and love God to the extent required by divine justice requires divine grace, but we, of our own free will, can overcome our inclinations and choose to accept the grace that allows us to be just. Thus, the Augustinian view underestimates the ability of humans to do good independently.

The Augustinian view also has pessimistic implications that, practically speaking, would render political systems unviable. The idea that people, especially Christians, should submit passively to their political regime and wait for the City of God would be pernicious to any social order. Indifference and nonchalance about what occurs in politics could lead to more suffering, corruption, and tyranny. Political engagement is the only means to prevent these atrocities from occurring. It is well-intentioned political activity and engagement that allows us to create relatively equitable societies. The City of God is a paradigm toward which people can meaningfully strive in their personal lives. Incorporating the social teaching of Jesus Christ into our daily lives could allow us to cultivate the values of a better society.

Despite the drawbacks to the pessimistic Augustinian view, however, its overall themes need to be addressed. Augustine’s pessimism is comforting in one way: he shows that our political structures are by nature imperfect, and therefore their failures are not caused by something of our own specific doing. On the other hand, admitting that human flaws preclude creating a political utopia fundamentally changes the posture by which one approaches the political realm. Without the burden of achieving institutional perfection, humans are free to pursue justice and peace within institutional deficiency. For the Christian, this means first and foremost focusing on the character of persons that comprise society. Augustine’s work, understood alongside the political ideology of Niebuhr, argued that the quality of society depends on the character and the nature of the people who compose it. They help us realize that the key to peace and justice, however imperfectly they may be realized, has to come from the good will of individuals. Indeed, if human character hinders society, it can also improve it. It therefore makes sense that Christ left no instructions for a political system. He did, however, instruct us to “love the Lord your God with all your heart, with all your soul, with all your mind, and with all your strength” and to “love your neighbor as yourself.”24 Properly living out these principles may not create the perfect society, but the Christian message assures us that it will create a virtuous one.

Jeffrey Poomkudy ’20 is from Old Westbury, New York. He is a prospective double major in Biology and Philosophy at Dartmouth.

• Alden Whitman, “Reinhold Niebuhr Is Dead; Protestant Theologian, 78,” The New York Times, 2 June 1971, PDF. ↵

• Henry Paolucci, introduction to The Political Writings of St. Augustine, by St. Augustine (Washington, D.C.: Regnery Publishing, 1962), xvii. ↵

• Paolucci, introduction, xvii. ↵

• Augustine, The City of God, trans. Marcus Dods (Peabody, MA: Hendrickson Publishers, 2009), 3, digital file. ↵

• Herbert A. Deane, The Political and Social Ideas of St. Augustine (New York: Columbia University Press, 1963), 16. ↵

• Augustine, City of God, 396. ↵

• Catechism of the Catholic Church (New Delhi, Theological Publications in India, 2013), 2515. ↵

• Catechism of the Catholic Church, 2515. ↵

• Augustine, “On Grace and Free Will,” ed. Kevin Knight, trans. Peter Holmes and Robert Ernest Wallis, New Advent: The Fathers of the Church, accessed March 14, 2017, <http://www.newadvent. org/fathers/1510.htm>. ↵

• St. Augustine, The Political Writings, ed. Henry Paolucci (Washington, D.C.: Regnery Publishing, 1962), 3. ↵

• “Original Sin,” in The Oxford Dictionary of the Christian Church, ed. F. L. Cross and E. A. Livingstone, 3rd ed. (Oxford University Press, 2009), digital file. ↵

• Reinhold Niebuhr, The Essential Reinhold Niebuhr, ed. Robert McAfee Brown (New Haven: Yale University Press, 1986), 123, digital file. ↵

• Reinhold Niebuhr, Moral Man and Immoral Society: A Study in Ethics and Politics (Louisville, KY: Westminster John Knox Press, 1932), xxix, digital file. ↵

• Niebuhr, Moral Man and Immoral, xxix. ↵

• Niebuhr, Moral Man and Immoral, xxix. ↵

• Benedicta Cipolla, “Reinhold Niebuhr is Unseen Force in 2008 Elections,” Religion News Service, 27 September 2007, PDF. ↵

• Michelle A. Benson, “Liberal Idealism,” Dr. Michelle A. Benson Personal Website, accessed 12 February 2017, <https://www.acsu.buffalo. edu/~mbenson2/PSC326.htm>. ↵

• Benson, “Liberal Idealism.” ↵

• Arthur Schlesinger, Jr., “Reinhold Niebuhr’s Long Shadow,” The New York Times, 22 June 1992, <http://www.nytimes.com/1992/06/22/opinion/ reinhold-niebuhr-s-long-shadow.html>. ↵

• John 18:36 (NABRE); Mark 12:17 (NABRE). ↵

• 1 Peter 2:13 (NABRE). ↵

• The Editors of Encyclopædia Britannica, “Manichaeism,” in Encyclopedia Britannica (Encyclopedia Britannica, 1998), accessed 12 February 2017, <https://www.britannica.com/topic/ Manichaeism>; “Pelagius and Pelagianism,” in New Advent Catholic Encyclopedia, ed. Kevin Knight, accessed 12 February 2017, <http://www.newadvent. org/cathen/11604a.htm>. ↵

• Michael Mendelson, “Saint Augustine,” in The Stanford Encyclopedia of Philosophy, ed. Edward N. Zalta. 21 December 2016, <https://plato.stanford. edu/archives/win2016/entries/augustine/>. ↵

• Mark 12:30-31 (NABRE). ↵

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Written by: Kamran Mofid

Published: 29 September 2017

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*(A note from Kamran Mofid: Recently I posted a Blog about the Silicon Valley and Henry George-This is how Silicon Valley may become a force for good: Dump Ayn Rand and embrace Henry George

Anthony Werner told me that he really liked the article. So, I then, asked him to consider writing a follow up. I am delighted that he agreed.)

Would Henry George’s ‘Remedy’ help us combat today’s global crises?

Anthony Werner, Editor-in-Chief, Shepheard-Walwyn Publishers, London, UK

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In Progress and Poverty[1] Henry George sought the ‘cause of industrial depressions and the increase of want with the increase of wealth’ and offered a ‘remedy’ which remains as relevant to the problems of poverty and inequality we face today, as when he first wrote, but it also opens a new way of dealing with environmental pollution.

To understand the relevance of the ‘remedy’ we need to understand what causes poverty and inequality. The cause is institutionalised, just as slavery once was. As Mandela pointed out in his Trafalgar Square speech in 2005: 'Like slavery and apartheid, poverty is not natural. It is man-made and it can be overcome and eradicated by the actions of human beings.'

What is the institution that makes poverty inevitable? Adam Smith described it very succinctly in The Wealth of Nations:

‘As soon as land becomes private property, the landlord demands a share of almost all the produce which the labourer can either raise, or collect from it. His rent makes the first deduction from the produce of the labour which is employed upon land.’[2]

More recently (27th Dec 2009) in the Financial Times John Kay wrote:

‘You can become wealthy by creating wealth or by appropriating the wealth created by other people. When the appropriation of the wealth is illegal it is called theft or fraud. When it is legal economists call it rent-seeking.’  

But, economists will say, private property in land is essential for economic development. Without security of tenure, nobody is going to invest in sowing crops or building a business. As Hernando de Soto pointed out in The Mystery of Capital[3] economic success has everything to do with the legal structure of property and property rights.

At the end of the 19th century there was growing friction between industrialists and workers over pay, and the appalling conditions under which so many workers lived was troubling the conscience of society. This prompted Pope Leo XIII in 1891 to issue his encyclical Rerum Novarum, ‘to refute false teaching ... in the interest of the Church and the commonweal ... [He] thought it useful to speak on the condition of labour ... [and] to treat expressly and at length, in order that there may be no mistake as to the principles which truth and justice dictate[4] for its settlement.’

He acknowledged that it is not easy ‘to define the relative rights and the mutual duties of the wealthy and the poor, of capital and labour’, but notes that ‘by degrees it has come to pass that working men have been given over, isolated and defenceless, to the callousness of employers, and the greed of unrestrained competition ... so that a small number of very rich men have been able to lay upon the masses of the poor a yoke little better than slavery itself.’

‘To remedy these evils the Socialists[5], working on the poor man’s envy of the rich, endeavour to destroy private property, and maintain that individual possessions should become the property of all, to be administered by the State or by municipal bodies. They hold that, by thus transferring property from private persons to the community, the present evil state of things will be set to rights’. The Pope argued that these proposals are ‘unjust, because they would rob the lawful possessor, bring the State into a sphere that is not its own, and cause complete confusion.’ History has demonstrated the shortcomings of the Communist experiment in the Soviet Union.

He goes on: ‘It is surely undeniable that, when a man engages in remunerative labour, the very reason and motive of his work is to obtain property, and to hold it as his own private possession. If a man hires out his strength or industry, he does this for the purpose of receiving in return what is necessary for food and living ...Thus, if he lives sparingly, saves money, and invests his savings, for greater security, in land, the land in such a case is only his wages in another form; and, consequently, a workingman’s little estate thus purchased should be as completely at his own disposal as the wages he receives for his labour. But it is precisely in this power of disposal that ownership consists, whether the property be land or movables.’ A bit further on the Pope repeats: ‘Hence man not only can possess the fruits of the earth, but also the earth itself’.

While George agreed that the fruit of a person’s labour belongs to them, he takes issue with the Pope over the morality of land ownership in an open letter.[6] He begins: ‘Your Holiness: I have read with care your Encyclical letter on the condition of labour, addressed ... to the Christian World.

‘Since the most strikingly pronounced condemnations are directed at a theory that we, who hold it, know to be worthy of your support, I ask permission to lay before your Holiness the grounds of our belief and to set forth some considerations you have unfortunately overlooked.

The momentous seriousness of the facts you refer to, the poverty, suffering and seething discontent that pervade the Christian world, the danger that passion may lead ignorance in a blind struggle against social conditions rapidly becoming intolerable, are my justification.

‘Our postulates are all implied in your Encyclical. They are the primary perceptions of human reason, the fundamental teachings of the Christian Faith: We hold that:

‘This world is the creation of God. The men brought into it for the brief period of their earthly lives are the equal creatures of His bounty, the equal subjects of His provident care.

By his constitution man is beset by physical wants, on the satisfaction of which depend not only the maintenance of his physical life but also the development of his intellectual and spiritual life.

God made the satisfaction of these wants dependent on man’s own exertions, giving him the power and laying on him the injunction to labour – a power that of itself raises him far above the brute, since we may reverently say that it enables him to become, as it were, a helper in the creative work.

God has not put on man the task of making bricks without straw. With the need for labour and the power to labour, He has also given man the material for labour. This material is land – man physically being a land animal, who can live only on and from land, and can use other elements, such as air, sunshine and water, only by the use of land.

Being the equal creatures of the Creator, equally entitled under His providence to live their lives and satisfy their needs, men are equally entitled to the use of the land, and any adjustment that denies this equal use of land is morally wrong.

Being created individuals, with individual wants and powers, men are individually entitled ... to the use of their own powers and the enjoyment of the results.

There thus arises, anterior to human law, and deriving its validity from the law of God, a right of private ownership in things produced by labour – a right that the possessor may transfer, but of which to deprive him without his will is theft.

This right of property, originating in the right of the individual to himself, is the only full and complete right of property. It attaches to things produced by labour, but cannot attach to things produced by God.’

Unfortunately, the encyclical remains the basis of Catholic social teaching to this day, thus supporting the status quo, but it is at odds with St Gregory the Great (Pope 590-604):

‘Those who make private property of the gift of God pretend in vain to be innocent, for in thus retaining the subsistence of the poor they are the murderers of those who die every day for want of it.’[7]

In 1881, a contemporary of Henry George, Dr Thomas Nulty, Bishop of Meath in Ireland, came independently to recognise the injustice of the private ownership of land and called in a pastoral letter for a radical reform of the Irish land tenure system. He acknowledged that evil social institutions had long endured - the slave owner's right of property was regarded as sacred as any other property right - but the world’s approval, the bishop argued, could not justify injustice. The death knell of slavery was only sounded when public attention was fixed on the intrinsic nature of slavery. Then it was no longer acceptable.

History has shown that land enclosure creates two classes in society, the landowners and the landless. The latter can only live by paying a rent to the former for the right to use land which is God’s gift to all humanity. The landowner is thus in receipt of an unearned income simply because society permits land to be owned, just as it once permitted slaves to be owned. Adam Smith was in no doubt about the effect: the landowner ‘acts always as a monopolist, and extracts the greatest rent which can be got for the use of his ground’.[8] Winston Churchill was even more explicit:

‘No matter where you look or what examples you select, you will see every form of enterprise, every step in material progress, is only undertaken after the land monopolist has skimmed the cream for himself, and everywhere today the man or the public body that wishes to put land to its highest use is forced to pay a preliminary fine in land values to the man who is putting it to an inferior one, and in some cases to no use at all.

All comes back to land value, and its owner is able to levy a toll upon all other forms of wealth and every form of industry. A portion, in some cases the whole, of every benefit which is laboriously acquired by the community increases the land value and finds its way automatically into the landlord's pocket. If there is a rise in wages, rents are able to move forward, because the workers can afford to pay a little more. If the opening of a new railway or new tramway, or the institution of improved services, of a lowering of fares, or of a new invention, or any other public convenience affords a benefit to workers in any particular district, it becomes easier for them to live, and therefore the ground landlord is able to charge them more for the privilege of living there.’

He then gave an example which illustrates why the welfare state is no solution to poverty and the widening gap between rich and poor:

‘Some years ago in London there was a toll bar on a bridge across the Thames, and all the working people who lived on the south side of the river had to pay a daily toll of one penny for going and returning from their work. The spectacle of these poor people thus mulcted of so large a proportion of their earnings offended the public conscience, and agitation was set on foot, municipal authorities were roused, and at the cost of the taxpayers, the bridge was freed and the toll removed. All those people who used the bridge were saved sixpence a week, but within a very short time rents on the south side of the river were found to have risen about sixpence a week, or the amount of the toll which had been remitted![9]

Today, Housing Benefits and other welfare payments have the same effect. Churchill concluded: ‘We do not want to punish the landlord. We want to alter the law.’

Churchill was one of the most outspoken supporters of Henry George who had realised that the injustice of land ownership could be ended by reforming taxation. It did not require the redistribution of land and could be introduced in stages so that it did not disrupt the economy.

Currently the rent of land goes to the landowner. George proposed that the rent be paid to the state, not as the landowner, which would amount to land nationalisation, but as the natural way to fund government without distorting the economy. The corollary was the abolition of all economy distorting taxes, which is why his proposal became known as the ‘single tax’.

Title to land and security of tenure would remain undisturbed but would carry with it an obligation to pay the market ground rent to the government in lieu of tax. All improvements, such as buildings, would not be included in the valuation, unlike today where improvements are taxed with VAT and property taxes, making some improvements unaffordable to the detriment of society. In a dynamic economy, rent would vary from time to time and from place to place and should therefore ideally be assessed on a yearly basis.

George called this payment a land-value tax to make clear that it was based on the market value, not on the acreage, of land, but it is not really a tax. It is a ground rent, reflecting the market valuation of the benefits accruing to the site. These benefits can be natural such as fertility and rainfall for agricultural land, but in an advanced economy location becomes the dominant factor – location, location, location as the estate agents say. For example in London, a good state school in the neighbourhood can add £100,000 to the value of a property. This extra value has nothing to do with the house, which may need renovation, but everything to do with the value parents place on being able to send their children to a good school, in other words, the location.

Currently the existing owner reaps the benefit of the uplift in location value. Were George’s proposal implemented, the government would be the beneficiary of an annual ground rent of about £5000 pa. The parents would also benefit: instead of having to borrow an extra £100,000, they would only have to pay £5000 in monthly instalments over the course of the year. The remaining £95,000, or part of it, would be available for renovating the house, if needed, benefitting local trades people and the economy generally. A win/win situation.

Much the greatest benefit of George’s reform is the removal of the injustice that causes poverty. There would be no landowner demanding the lion’s share of the produce or taxman seeking a cut, so the worker would keep the full reward of his efforts. The payment he makes to the government would be for the benefits he derives from society where he lives or works, and he would know how much he would have to pay by choosing where to live and work. To maximise its receipts, government would be incentivised to maximise the benefits they provide to society. Funded out of rent rather than arbitrary taxes, government income would be more predictable year on year and tax avoidance be almost impossible - and unnecessary.

If government were to receive a market-determined ground rent from all occupied properties in the country, public services could be funded without taxation. The replacement of taxation would in itself be a huge benefit to society. As Lord Soames pointed out: ‘If one were to set out with a specific, stated objective of designing a tax system which would penalise and deter thrift, energy and success, it would be almost impossible to do better than the one which we have in this country today.’ (House of Lords, 3rd July 1978)

George’s reform would also restore a right relationship between humanity and the earth. As Mrs Thatcher put it at the Conservative Party Conference in 1988: ‘No generation has a freehold on this earth. All we have is a life tenancy – with a full repairing lease.’[10] It is not suggested that Mrs Thatcher fully understood the implications of her statement, but it neatly sums up Henry George’s argument and reminds us that the leaseholder, in addition to paying the rent, owes a duty of care to keep the land in good condition, thus taking care of the environment.

It would be too disruptive of the economy and banking system to introduce George’s ‘reform at a stroke. Existing taxes would need to be abolished, a few at time, while a proportion of the ground rent were collected on a revenue neutral basis. At each stage, as more taxes were abolished, a higher percentage of the rent would be payable until all taxes were abolished and government was funded entirely out of ground rents. A description of how a start could be made to replace the existing tax system with an annual ground rent is described in Public Revenue without Taxation.[11]

[1]  Henry George, Progress and Poverty , (1879), Robert Schalkenbach Foundation, 1992.

[2]  Adam Smith, The Wealth of Nations, Bk 1, ch 8

[3]  Hernando de Soto, The Mystery of Capital, Basic Books, 2003.

[4]  Emphasis added

[5]  Today we would use the term ‘Communist’ rather than ‘Socialist’

[6]  Henry George, ‘The Condition of Labour’ (1891) in The Land Question, Robert Schalkenbach Foundation, 2009.

[7]  Quoted in Roy Douglas, ‘Single Tax 1896’, in Land, People and Politics: a History of the Land Question in the UK 1878-1952, Allison & Busby, 1976, p.11.

[8]  Adam Smith, The Wealth of Nations, Bk 5, ch 2, Article 1.

[9]  Winston Churchill, The People’s Rights, Hodder and Stoughton 1909, originally delivered as a speech in Edinburgh on 17th July 1909.

[10]  The Greening of Mrs Thatcher, The Economist, March 11 1989

[11]  Ronald Burgess, Public Revenue without Taxation, Shepheard-Walwyn, 1993.