|Henry George in Australia|
HENRY GEORGE IN AUSTRALIA
About the Author
Dr. John Pullen taught Urban Economics and the History of Economic Thought at the School of Economics, University of New England, Armidale, New South Wales, Australia 2351; e-mail: firstname.lastname@example.org.
His study has received generous financial support from the Walsh Bequest, Macquarie University, Administrative support from Sean Turnell, convenor of the Walsh Bequest Committee, has also been very helpful. Additional financial support has been provided by the Henry George Foundation of Australia. The author is particularly indebted to Alan Dunstan for assistance in obtaining copies of newspaper reports and for invaluable background information on many aspects of Henry George’s tour, and to Richard Giles, Secretary, Association for Good Government, for advice and support. The following also have contributed ideas and suggestions: Geoff Forster, Syd Gilchrist, Betsy Harris, Graydon Henning, Bryan Kavanagh, David Smiley, David Spain, Kenneth Wenzer and the late Bill Pitt.
The phrase “more destructive than the rabbit or kangaroo”
comes from a report of a speech made by George
in Rockhampton (Queensland)
May 16, 1890.
The Itinerary: a Brief Resumé
Henry George and his wife Annie arrived by ship in Sydney on March 6, 1890, having departed from San Francisco on February 8. They were met at circular quay by a cheering crowd who marched in procession with a brass band and accompanied the Georges in a four-horse coach, to the Town Hall, where the Lord Mayor made an official speech of welcome and George responded. That evening was a banquet in Henry George’s honour at the town hall. Formal welcomes and banquet were to become frequent features of his tour.
His first lecture in Australia was delivered at the Protestant Hall in Sydney on Saturday evening, March 8, on the topic “The Land for the People”. He spoke for two hours without notes and at the end “received a recognition that was magnificent in its spontaneity and heartiness” (Echo, March 8). It was the first of six public lectures he was to deliver at various times in Sydney. The following day, Sunday, March 9, he preached in the Pitt Street Congregational Church on the text “Thy Kingdom Come”, the first of nine Sunday sermons he gave in Australia in nonconformist Protestant churches. Three more public lectures followed in Sydney on successive days.
On Thursday, March 13, the Georges set out by train on a six-day lecture tour of five country towns to the west and north of Sydney – Lithgow, Orange, Bathurst, Newcastle and Maitland – and returned to Sydney on March 19, which was spent writing a report of his visit so far for The Standard.
The following day, March 20, they travelled by train to Melbourne, lecturing at four inland towns en route – Goulburn, Cootamundra, Wagga Wagga and Albury – arriving in Melbourne on March 25. he gave three lectures in Melbourne followed by lectures in four towns to the north and west of Melbourne – Bendigo, Echuca, Ballarat and Geelong – returning to Melbourne on Easter Monday, April 7, to engage in a well-publicized public debate with William Trenwith, a prominent Labor spokesman and a leading advocate of protectionism. After returning to Sydney, George set out on another tour of inland towns in New South Wales, lecturing at Blayney, Carcoar, Cowra, Grenfell and Forbes. He left Forbes at 6 a.m. on April 15 to return to Sydney, travelling all day by coach and all night by train.
The following day, Wednesday, April 16, was spent composing the second report for The Standard. On Thursday evening, April 17, he and his wife set out for South Australia via Melbourne, arriving in Adelaide on the morning of Saturday, April 19. They were met at the train station by a deputation of supporters, as usual, and on this occasion by the American consul. Despite the long journey, George took the opportunity of an election day in South Australia to tour the polling places and see an Australian election in progress. He was very impressed with the Australian system of secret ballots and particularly noted the relative absence of accusations of corruption. The people of Australia, he said, “seem to thoroughly believe in the purity of their government and public men” (Standard, June 11). That afternoon they were given a formal welcome and a “beautifully illuminated address” to which George made a lengthy speech in reply.
His first lecture in Adelaide occurred on Monday evening, April 21, at the Adelaide Town Hall, on “The land for the People”. Those in attendance included the Premier of South Australia, the Chief Justice and the Commissioner of Crown Lands. On Tuesday, April 22, he wrote his third report for The Standard and had dinner with the Premier. He gave his second Adelaide lecture on Wednesday, April 23, followed by lectures in five country towns of South Australia – Moonta, Gawler, Port Adelaide, Port Pirie and Kapunda – returning to Adelaide on May 2 and setting out on the long journey back to Sydney via Melbourne, arriving in Sydney on May 5.
On May 8, the Georges travelled north to Brisbane, a train journey of about 36 hours, arriving on May 10. A procession of several hundred people, which they headed in an open carriage, moved from the train station to the city, where they were greeted by the mayor and an address of welcome was read. George gave two lectures in Brisbane before taking a ship northward to lecture at Rockhampton, Maryborough and Gympie. Back in Brisbane on May 23, he gave his third lecture and, after a lecture at Ipswich on May 24, left Brisbane to return south by train, lecturing on way at Armidale, Hillgrove and Tamworth, arriving back in Sydney on May 30. The tour was now coming to an end. George gave his sixth and final Sydney lecture on May 31, and on June 2 the Georges attended a formal farewell dinner where they were honoured with speeches, toasts and gifts.
On June 3, they took the train for Melbourne and arrived there on June 4. George attended the Victorian Parliament on June 5 and gave his farewell Melbourne lecture on June 6. They boarded the S.S. Valetta in Melbourne on June 7 and sailed to Adelaide, where they arrived on the morning of June 9. That evening they were guests at a special banquet attended by the American consul and leading South Australian politicians.
George gave his final lecture in Australia in Adelaide on June 10. They left Australia for London on the Valetta on Wednesday, June 11. They disembarked at Brindisi and travelled on to London, visiting Naples, Pompeii, Venice, Rome and Paris. There is no record of his having given any lectures or sermons on the way from Brindisi to London. The diary shows that in Britain he also visited Birmingham, Glasgow, Manchester and Liverpool. Henry George Jr. in his Life of Henry George states ( 1943: 539) that George made two speeches – one in the Glasgow City Hall and one under the auspices of the Radical Association of Walworth in London. They arrived back in the United States at New York on September 1.
Some General Observations on George and the
Australian Lecture Tour
A Feat of Endurance
The most obvious comment to be made on George’s 1890 lecture tour of Australia, one that would have to be admitted by foes as well as friends, is that it was a remarkable feat of physical and mental endurance. During his 98 days in Australia, George gave 48 formal lectures, 9 Sunday sermons, numerous responses to addresses of welcome and farewell and numerous interviews with reporters. In doing so, he visited four states (or colonies, as they then were), spoke in 38 different cities and towns, and travelled by train, ship and coach within Australia over 7,000 miles, about as far as from Sydney to Delhi, or nearly as far as he travelled from San Francisco to Sydney. Many of his train trips were overnight, some in mail trains involving frequent stops at a time when train travel, though improving, must have been quite tiring.
The manner of his lecturing would have contributed to the strain. He always spoke without notes. And although the lectures all dealt with either one or both of only two main themes (land-value tax and free trade), and although the titles of the lectures were frequently repeated, the contents of the lectures (even those bearing the same title) were generally quite different, often incorporating references to local circumstances and problems familiar to the particular audience.
The contemporary reports did not always note the duration of the lectures, but when the duration was noted, they were usually two hours or longer and included responses to questions from the audience. When the sizes of the audiences were reported, they ranged from a few hundred to about 2,000. Larger audiences would obviously be more likely to occur in the larger cities and towns. There were several instances however, where attendances were reported to have been surprisingly and unexpectedly small. These included Geelong, where there was a “very small” audience, but that was thought to be due, at least to some extent, to incorrect information in the local newspaper. At Port Adelaide and Gawler in South Australia, the attendance being moderate and scattered throughout the hall, he invited all to come to the front. As one commentator said (Bunyip, May 8, 1890), there would doubtless have been a larger audience if admission had been free. Although George’s oratory was adequate to the task, the strain of maintaining the attention of the larger audiences for two hours must have been considerable.
The Australian lectures appear to have been conducted in an orderly fashion. Interruptions from the audience were generally favourable to the speaker, with cheers, shouts of “Hear, hear”, and supporting laughter. On one occasion in Sydney, a member of the audience insisted on speaking after the meeting had been formally closed, arguing that he had not been able to make himself heard during question time. On another occasion in Sydney, the chairman had to urge the audience to distinguish between asking a question and making a speech, and in Gympie an interjector had to be removed by the police. But otherwise the audiences appear to have behaved respectfully, even though they might not have been in complete agreement with what they heard.
The travel and speaking arrangements for his Australian tour do not appear to have been designed for George’s comfort and convenience. They involved an incredible amount of unnecessary journeys, requiring that he retrace the same routes several times. He passed through Brisbane twice, Melbourne three times and Adelaide twice. It would have been far simpler if, after an initial reception and/or lecture in Sydney, he could have sailed to his northernmost point (Rockhampton) and then travelled south in one arc through Queensland, New South Wales, Victoria and South Australia, departing from Adelaide for Europe. He himself complained about the unnecessary and tiresome criss-crossing ands back-tracking and also about the amount of time and effort involved in visiting small country towns when in the limited time available he could have reached a wider audience by more lectures in the larger towns and cities. His schedule of lectures appears not to have been arranged fully in advance but to have been adjusted as the tour progressed, with some lectures being added (notably, the debate with William Trenwith) and some being cancelled.
He appears to have survived the Australian ordeal remarkably well. Of the newspaper reports investigated, only two refer to any ill effects. At Port Pirie on April 30 he was “very much indisposed”(Port Pirie Advertiser, April 29, 1890), and at Kapunda on May 1 he suffered from “a severe cold, which interfered very much with his speaking” (Kapunda Herald, May 6, 1890). The sea voyage from Australia and the days spent touring Italy and France might have afforded rest and recuperation, but the strain of the Australian tour could well have contributed to the mild stroke, resulting in temporary aphasia, suffered later that year.
Oratory and Rhetoric
The contemporary newspapers, even those opposed to George’s policies, almost entirely agreed in paying tribute to his remarkable oratory and formidable rhetorical skills. The Melbourne Argus of March 27 said: “Few audiences have ever been more under the spell of an orator than was the one which assembled in the Town-hall yesterday evening to listen to Mr. Henry George”. The Adelaide Advertiser was not at all sympathetic to George’s ideas – “We doubt whether his visit here will leave behind it any deep impression” – but was unstinting in its praise of his eloquence, declaring that his lecture in Adelaide on April 21 was “one of the most brilliant displays of platform eloquence to which a South Australian audience was ever treated” (Adelaide Advertiser, April 24, 1890).
In the public debate with William Trenwith in Melbourne on April 7, George was said to have spoken “with an eloquence that is rarely heard in these platform discussions. Scornful and appealing by turns, his declamation held even the people who might not follow his arguments”. His rhetorical and debating skills were altogether too much for Trenwith, who at one stage began “to fume” and accused George of unfairness, of perverting his words, and of “tricks of the platform” (Australasian, April 12, 1890).
George ably exploited an ability to summarize his arguments in short, dramatic statements that raised cheers and shouts of approval from his audiences. In Maitland he said: “What did protective duties protect [the workers] from? It protected them from what they wanted” (Maitland Mercury, March 20, 1890); in Melbourne: “labour never wanted anybody’s protection. What labour wanted … was justice” (Argus, March 27, 1890); in Gawler: “if a man who did not work got an income, then people who did work, did not get all they earned” (Bunyip, May 2, 1890); and in Adelaide: “The landowner [is] a perfectly useless animal” (Adelaide Observer, May 3, 1890).
However, one aspect of his delivery that did not appeal to reporters was his American accent. Some complimented him on having only a slight American accent; others were less forgiving, saying that if he wished to address “English-speaking” audiences, he should at least learn to speak with a proper English accent: “Why cannot he, before trying to talk to English-speaking folk, make an attempt to overcome his accent?” (Argus, March 26).
A feature of his lectures, frequently acknowledged by the newspapers, was his humour and wit, with the protectionists as the most common target. He made fun of the residents of Victoria, the Victorians, who staunchly advocated protectionism but went to Sydney to shop and returned to Victoria with as many new clothes as they could, sometimes wearing two suits to avoid customs duties (Sydney Morning Herald, March 11, 1890). He mocked the system in which customs duties were levied on the lunches of children who crossed the Murray River separating Echuca in Victoria from Moama in New South Wales for a Sunday School picnic. He called the customs officers on the Murray “licensed highwaymen” (Riverina Herald, April 2, 1890). He “caused merriment” when he noted that Victorians put an export duty on scrap iron and an export bounty on butter and concluded that therefore Victorians must like scrap iron better than butter (Bendigo Advertiser, April 1, 1890). Laughter also greeted his reply to an argument for protection for infant industries that infant industries grow old and “rickety” and that “the older they grew, the more they wanted the bottle” (Albury Border Post, March 25, 1890). When a protectionist objector argued that after protections was introduced in Victoria the area of land under cultivation had doubled; George amused his audience by replying that the amount of rain had also doubled (Sydney Morning Herald, March 12, 1890).
A favourite literary technique of his published works, and one that was used most effectively in his Australian lectures, was the homely and humorous metaphor, applied particularly to support the principle of equal rights to land, and to reject priority of occupation as a justification for exclusive private property in land. The metaphors included:
« the dinner party, where the first to arrive occupies more than one chair and claims more than one dinner, either consuming the food intended for others or selling it to them;
« the compartment of a railway carriage, where the first to enter occupies all the seats;
« the oasis in the desert, where thirsty travellers are easily exploited;
« the cabbage farm and the pot of gold; j
« the desert and the manna, where if the desert had been private property the Israelites would have had to buy the manna; k
« property rights in heaven. l
In his publications and lectures, George showed that he was a skilled practitioner of the art of metaphorical economics. He would have envied the coiners and users of our modern anti-protectionist metaphors such as “the level playing field” and “picking winners”. He was aware that the metaphor is the message and lingers on when the formal arguments are long forgotten or refuted.
George’s lecturing style could fairly be described as forthright. The audiences were left in no doubt about his double message of the single tax and free trade. His lectures were not academic seminars where the advantages and disadvantages were laid out and the listeners left to decide. The opposing views of protection and unlimited untaxed land ownership were mentioned only to be dismissed, usually with scorn, derision, and sharp wit.
George did not seek to avoid criticism or to circumvent opposition by adapting his lecture material to the expected views of each audience. For example, in strongly protectionist Victoria he did not choose to emphasise his land tax argument in preference to his anti-protectionist argument but, on the contrary, accepted the challenge of a public debate with a leading protectionist. And although he expressed admiration for some Australian institutions, notably the secret ballot and Torrens Title, he was not loath to express his disapproval of others. For example, in Adelaide on April 26 he was quoted as saying:
In the colonies [of Australia] I have been through, the curse of land monopoly and land speculation is over everything. I don’t know of any new country where more striking instances of the absurdity and injustice of our present treatment of land is to be seen. (Adelaide Observer, April 26, 1890).
j A farmer on the edge of town was told there was a pot of gold in his field of cabbages. So he dug up the whole field and ruined all his cabbages without finding the pot of gold. The pot of gold was, of course, the unearned income that would come from the spread of population.
k “Though God were to rain wealth from heaven or cause it to burst up from the earth, to whom would the wealth belong? Nay, if the land had been property when the Israelites were in the desert, to whom would the manna have belonged?” (Bunyip, May 2, 1890).
l “[I]f the first people [to enter heaven] were to parcel out heaven as men parcelled out this world, would there not be poverty in heaven itself?” (Bunyip, May 2, 1890).
His forthrightness was also evident in that he was even prepared to criticize publicly some of the ideas of his supporters. In Adelaide, for example, he disagreed with a proposal made by the South Australian Single Tax League to exempt from land-value tax any sums previously paid to the state to acquire land. He also disagreed with a proposal of the supporting South Australian Register to tax only the increases in land value as J. S. Mill had proposed. And although he praised the South Australian Premier for introducing a tax on the unimproved value of land, he publicly criticized the Premier’s proposal, in the Premier’s presence, to charge a higher rate of tax on larger properties (Adelaide Observer, April 26, 1890). His blunt and forthright manner was also evident in Wagga Wagga on March 22 when he commenced his lecture with some very disparaging remarks about the British monarchy, remarks that must have offended some of the audience. They were not a response to a specific question, nor in any way essential to the argument he was about to develop:
MR. GEORGE, on coming forward, was received with great applause. He said in the dining-room or the drawing-room of the hotel in which he was staying in their town there was on the mantelpiece a figure of Queen Elizabeth in a fearful and wonderful dress, an utterly absurd dress. He had not the highest opinion of Queen Elizabeth, but she was a good deal better than the man who succeeded her, and the man who succeeded him. They were all a bad lot. (Wagga Wagga Advertiser, March 25, 1890).
Similar anti-monarchist tendencies underlay the following exchange in his third Sydney lecture of March 11, which implied that neither monarchy nor an established church nor protection are in any way conducive to manufacturing greatness:
Q. Is it not an historical fact that no country has ever become great as a manufacturing country except under the influence of protection?
A. Is it not also true that no country arrived at its greatest as a manufacturing country unless it had monarchy and an established church? (Loud cheers). (Sydney Morning Herald, March 12, 1890).
George and the Churches
Another interesting feature of George’s Australian tour was its connection with nonconformist Protestant churches. His nine sermons were preached in Presbyterian, Congregational, and Baptist churches. Two of his six Sydney lectures were delivered in the Protestant Hall in Pitt Street. In a number of his public lectures, nonconformist ministers either chaired the meetings, were present on the platform, or moved the vote of thanks and, on one occasion, a public meeting began and ended with a prayer from the ministerial chairman. George is known to have been deeply religious, and it is not surprising therefore that in his lectures and of course in his sermons he frequently alluded to religious themes. He was either not aware of or did not subscribe to the doctrines of the separation of the normative from the positive and the church from the state. Asked in Adelaide whether “the pulpit should be fighting this question of the land for the people,” he replied: “Yes. Thank God, the pulpit was beginning to fight it out. In every country and in every Church ministers were bravely upholding the single-tax policy” (Adelaide Observer, April 26).
It is interesting to speculate on the reason for the absence of a similar connection during the Australian tour with the Catholic and Anglican churches. He was raised an Anglican (i.e. Episcopalian) and does not appear to have had any sectarian bias against Catholics. His wife was a Catholic; his wife’s sister was a Catholic nun; he and his wife appear to have had a close and warm friendship with a Catholic priest in Ireland. He frequently cited with approval the views of Bishop Nulty, Catholic bishop of Meath in Ireland, and for a time he was strongly supported in the United States by Father McGlynn. His diary shows that in London on August 16, 1890, he called on Cardinal Manning, whom he had previously met in 1884. His disagreement with the Pope did not occur until 1891 (The Condition of Labour: An Open Letter to Pope Leo XIII), following the publication of the Papal Encyclical “Rerum Novarum”.
The fact that Catholic and Anglican churches, unlike the nonconformist churches, did not have the tradition or custom of lay preachers could explain why his sermons were given only in the latter, but it does not explain why representatives of the former did not offer public support in other ways. A possible explanation is that Catholic and Anglican churches were probably larger landowners than the nonconformist churches and therefore were more afraid (rightly or wrongly) of the financial effects of George’s single-tax policy. Whether or not such fear was justified would depend on whether the taxes they paid on the land value of their properties were greater or less than the benefits they received from the abolition of other taxes. In reply to a question, George said that it was his personal view that land owned by the churches should not be exempted from a land-value tax but that he believed that each government should be free to make its own decisions on this question.
The issue of Chinese migration and Chinese imports was being vigorously debated in Australia in 1890 because of the fear that Chinese migrants and the import of cheaper goods from lower-wage countries like China might aggravate the serious Australian unemployment situation. George addressed the question in some of his lectures and in replies to questions from audiences. In keeping with his free-trade and anti-protection policy, he did not oppose the importation of Chinese products, but he did oppose Chinese immigration on grounds of social harmony and cohesion.
Asked in Goulburn on March 20 whether he would keep out the Chinese, he is reported to have replied: “If it were my country I would keep them out. In our present state I would exclude any race out of harmony with our conditions” (Goulburn Evening Penny Post, March 22, 1890). And in Cootamundra on March 21, asked how he reconciled his views on the universal brotherhood of mankind with the exclusion of the Chinese, he replied that the Chinese “were not assimilable and would not mix readily with our people”, adding that he would also exclude the French, the Germans, or people from any other country if they formed colonies of their own and retained their own language and traditions (Cootamundra Herald, March 26 1890). A similar view was expressed in Melbourne on March 26: “I would not allow the Chinese to come here, for one good reason. They do not assimilate, and consequently would be a source of danger and weakness” (Argus, March 27, 1890). This social-cohesion argument was supported by an economic argument: “When labour is forced into cut-throat competition with labourers used to a lower standard of comfort, it may tend to hasten the decline of wages” (Argus, March 27, 1890), but he did not appear to see any contradiction between that argument and his argument that the unrestricted import of goods from low-wage countries would not adversely affect wages and employment in the importing country. He presumably thought that under a free-trade and single-tax regime any adverse effects on wages due to the unrestricted import of cheaper goods would be more than offset by the benefit accruing to the purchasing power of wages due to the abolition of domestic excise duties. But this offsetting effect would apply also to any adverse effects on wages due to compensation from immigrant labour.
A Commentary on the Lectures
A major objection to the introduction of a land-value tax – an objection frequently raised in question time following George’s lectures – was that of compensation for existing owners who might have purchased land at a price that reflected its expected future value and that would be either reduced or entirely wiped out by a land-value tax. In his published works he resolutely refused to countenance compensation in such cases, and in general he held to this view in his Australian lectures. For example, in his first lecture in Adelaide, on April 21, he was reported to have said:
if they took away land values they took away nothing which a man had had in the past, but merely took away what he might have in the future. They were not confiscating; they were stopping confiscation (Cheers). He was sure they in South Australia would consider compensation in such cases preposterous (Cheers and “Oh”). The request for compensation was that if their privilege was taken away in the form of rent it should be given back in the form of interest (Laughter). The thing only had to be looked at to appear preposterous (Cheers). The compensation, if any, ought to be made to those that had suffered – (loud cheers) – to those whom the cursed system had overweighted – those whose frames it had distorted, and those whose mind it had darkened, not those who had profited by it (Cheers). (Adelaide Advertiser, April 22, 1890).
In reply to those who said that the introduction of a land-value tax without compensation is confiscation, he argued that the existing system that allows landowners to absorb the increases in land value without taxation is confiscation:
Take a mere landowner who is deriving an income from land – he produces nothing. When by mere ownership he gets the proceeds of labour, is not that confiscation of labour? (Bunyip, May 2, 1890).
An additional argument used to support his stand against compensation was that his reform was only a taxation measure, and it had never been the practice to compensate people for any disadvantages suffered by taxation changes. South Australia had just introduced a land tax of one half shilling on the pound without paying compensation.
But the compensation issue seems to have caused him some concern. He admitted that he himself had at first proposed an exemption of $1,000. The objection might have been at least partially satisfied if he had followed J. S. Mill in applying the tax only to increments in land value after a base date nominated in the legislation. But this was another issue that threatened the simplicity and integrity of the single-tax solution.
The administrative and technical details of a land-value tax appear to have bothered and annoyed George. He asked his Adelaide audience on April 21 “not to fiddle with little questions, but to say to themselves, ‘is this just or right’”. Failure to resolve the “little questions” of an administrative or practical nature has been a major reason for the failure of later attempts to impose land-value taxes or betterment taxes, such as the U.K. Land Commission Act, 1967, or the N.S.W. Land Development Contribution Act, 1970. The former imposed a 100 percent levy on the increase in the value of land that receives approval from the government planning authority for “higher” development (for example, from rural use to housing use). The choice of a rate of 100 percent for the levy was later identified as one of the reasons for the failure of the Land Commission Act, because it discouraged landowners from applying for planning permission and resulted in a shortage of development land. The rate of 100 percent gave expression to the Georgist principle that increases in land value are created by society and therefore should belong to society; but made no concession to the difficulties of practical implementation. It made no attempt to win the co-operation of landowners and did not recognize the need for political compromise.
The N.S.W. Land Development Contribution Act imposed a 30 percent levy on the increase in land value associated with the granting of planning permission for a higher use, thus avoiding the discouragement effect of a 100 percent levy, but the revenue from the levy, which was naturally small in the early years, was not subsidised by adequate loans from government sources, was not spent on identifiable projects of public benefit, and did not generate sufficient vested interests amongst voters to withstand the counterattacks from landowners, developers, and other vested interests.
George’s preference for pursuing his land-tax reform at the level of principle and his reluctance to grapple with the “little questions” that would make or break the practical implementation of the principle left too many questions unresolved and probably had a harmful effect on the long-term general acceptability of his proposed reform.
The Australian lectures support the view that, although George advocated state ownership in some circumstances, he was a strong decentralist, a believer in the devolution of powers from central to local government. He argued that the revenue from a land-value tax “belongs to the people who live in the locality and should be used in that locality”. It is a “great injustice” for it to be taken by the central government and divided out in subsidies for municipalities. He believed that some portion of the revenue should go to the support of the central government but that the greater part should be collected and used by each locality. He was generally full of praise for Australian and Australians, but on occasion he could not refrain from admonishing them for their lack of local initiative. In his lecture at Goulburn on March 21, 1890, he said:
It seems to me preposterous that the central government should build waterworks for towns and give subsidies in aid of planting parks and furnishing trees for people to plant. You’re away ahead in many things, but if you will allow me to say so I think you’re behind in some. Your towns need more trees. I can see no reason why you haven’t splendid trees, except you’re waiting for the general government to furnish them (Laughter). That paternal spirit is the spirit of protection. The principle of free trade is leaving everything concerning the town to the people of the town, everything concerning the country to the people of the country, and everything concerning the whole to the head government. (Goulburn Evening Penny Post, March 22, 1890).
The idea was repeated the following day at Cootamundra:
He considered the taxation raised in any particular locality should be spent in it and for its benefit (Cheers). We ought not to go to the central government for everything, but by a system of local government take into our own hands the management of our own affairs and the spending of the taxation raised locally. (Cootamundra Herald, March 26, 1890).
And at Albury he was reported to have said that the land-tax revenue should be devoted “in a large degree to the municipalities,” and that the municipalities “should carry out many works which were now done by the central government,” while reserving a portion for the purposes of the central government. (Albury Border Post, March 25, 1890).
He does not appear to have considered the possibility that, if municipalities are each free to set the percentage for the tax, the percentages could vary widely. This could result in wide differences in the proportion of land value collected and would mean that the goal of an equal sharing of land value would not be realized. Nor does he appear to have considered the question of whether or how the land-tax revenue should be redistributed from local government areas where land values are high to areas where they are low.
Although George clearly favoured a decentralized political system, his view on the effect of the single tax on geographical decentralization was not as clear. In one lecture (Albury, March 24), reviewing the advantages of a tax on the unimproved value of land, he declared that one effect would be “to settle people more together” (Albury Border Post, March 25, 1890), presumably because it would discourage the withholding of land from urban development and would encourage full development of sites. Elsewhere, however, he suggested that it would encourage geographical decentralization because businesses and residents would tend to move out of the cities where land values and land-value taxes were high.
George thus seems to have argued that the land-value tax would set in motion forces acting in opposite directions, without indicating which would be the dominant force. This dilemma persists amongst modern Georgists.
The “Single Tax” Title
A question was raised in Adelaide concerning the appropriateness of the title “Single Tax”. The South Australian Register supported George’s policy of a land-value tax but held that “Single Tax” was not a good title. George’s response was interesting. He surprisingly admitted “[p]erhaps it was not [a good title],” implying that he was not entirely satisfied with the phrase, but justified it on several grounds:
(a) he could not think of a better;
(b) it clearly expressed their methods; and
(c) it dispelled the false notion that they proposed to divide up the land.
(Adelaide Observer, April 26, 1890).
He was reported as saying that no-one had invented the “Single Tax” title m. It had come by accident and had stuck. He realized that some of his followers objected to it (Adelaide Advertiser, April 24).
In retrospect, the choice of the “Single Tax” title appears to have been a grave error of political judgment for Georgists. In the short run, it attracted wide support amongst non-landowners, for it held out the prospect of their having to pay zero taxes. But, in the long run, with the ever-increasing expenditure of the welfare state, government countercyclical budgeting, defence and so forth, doubts have been expressed about the adequacy of the single tax, and this has had adverse repercussions on Georgism as a whole. Critics who reject the policy of a single tax seem to believe that they have thereby rejected all of George’s thought. Other Georgist themes, such as the principle of equal rights to land and to land value, have not received the recognition they deserve.
Adequacy or Inadequacy of the Single Tax Revenue
The adequacy or inadequacy of the revenue from the single tax has been one of the main controversies in debates about the merits of Georgism. Many have argued that George was mistaken in thinking that the revenue would be sufficient to meet the costs of government. It may come as a surprise for the modern reader to find in these lectures that George believed the revenue would not merely be sufficient but would in fact exceed government requirements. The problem that concerned the Single Taxers at the time was not whether the revenue would be adequate but whether to be a “limited Single Taxer” or an “unlimited Single Taxer”, in other words, whether to take by taxation only enough land value to meet the needs of government or whether to take the entire land value. The latter case would give rise to the further problem of what to do with the surplus. The following remarks at Wagga Wagga on March 22 convey George’s position:
In reply to a question as to what would be done with the proceeds of the land tax when it exceeded the cost of Government, Mr. GEORGE said that there might be no anxiety on that head. Many ways would be found of spending it advantageously to the community. They could expend it partly for educational purposes, for increasing the useful public works of the colony in the provision of parks, museums, public libraries, art galleries, in improving the sanitation of towns and dwellings, and in the hundred different directions which were not now attended to. Furthermore, they could make provision for the widow, the orphan, and the helpless n, not doled out to them as charity, but given to them in virtue of their citizenship. (Wagga Wagga Advertiser, March 25, 1890).
m Kenneth Wenzer has advised that the phrase “single tax” was invented by Thomas G. Shearman.
n It is not clear what George meant by “the helpless”. Did he intend it to include other kinds of economically disadvantaged people, such as the sick, the incapacitated, the elderly, the deserving poor? He presumably believed that when his reforms become fully operational there would be no unemployed.
George also believed that it “would be possible when the [single tax] system was in full working order, to reduce fares and freights on the railways by one-half, or to such an extent as would just cover the working expenses” (Wagga Wagga Advertiser, March 25 1890). In other contexts he suggested that railway services could be free.
It is interesting to note that he regarded welfare payments to “the widow, the orphan, and the helpless” as a right of citizenship, not a charity. It is also interesting that his suggestions for disposing of the revenue surplus did not include direct per capita grants.
This clearly indicates that George’s perception of the role and cost of government was much narrower than is commonly perceived today. His claim that the land-tax revenue would be adequate to meet the narrowly perceived cost of government was therefore much less contentious than it now is. However, the claim that the land-value tax would not only meet the narrowly perceived cost of government but also provide a surplus for the extra public services mentioned above remains somewhat contentious, especially if the tax were imposed not on the existing land-value but on the increments in land value from a base date nominated in the legislation. Another criticism of the land-value tax, one often put to Georgists today, was that although one purpose of the tax is to raise revenue, another purpose is to reduce land prices. Success in the latter would limit success in the former. A critic in Gawler expressed the problem thus:
But is it not likely that the tax they (the Single-Tax people] will impose will so lower the value of land that there will be no unearned increment? It is not likely … when freehold land is taxed at a heavy rental, that anyone will care to buy it, except at a very low price, Then where will the revenue come in? (Bunyip, May 9, 1890).
Georgists respond to this problem by distinguishing between land price and land value and by arguing that, in a Georgist system, the market price of land will tend toward zero but the owner/occupiers will pay to the government a rent that is equal to the land value.
Given George’s intense opposition to monopoly o, particularly in land, his audiences might have expected him to have some harsh words to say against trade unions. But his attitude to unions was quite supportive. In his Brisbane lecture of May 23, he recognized that trade unionism was “only a palliative” and that “there was danger in going too far in that direction”, but he stated (without any hint of regret) that he had always been a member of a union when he was working at his trade and that he was “glad to know” that the Queensland shearers had won their point in a recent dispute (Queenslander, May 31, 1890). At the banquet held at Sydney Town Hall on March 7 to welcome him to Australia, he expressed his great satisfaction at the formation of a trade union for sailors, whom he felt needed the protection of a union, and he trusted that it would “grow in strength and influence” (Sydney Morning Herald, March 8, 1890).
o He opposed protectionism, not merely or mainly because it raised prices and limited choice, but also because of its tendency to foster monopolies and to weaken competition in the protected country.
At Maitland on March 18 he declared that any improvement that had been achieved in the condition of labour had been won by labour combinations (Maitland Mercury, March 20, 1890), and the Ballarat Star of April 4 reported him as saying, “Wherever wages were improved, it might be traced to the efforts of labour in combination”. But he believed that if his fundamental reforms (free trade and land rights) were implemented, trade unions would no longer be necessary.
Free Trade and Land Rights
In George’s mind, the argument for free trade and the argument for land rights were closely and logically linked. Most, if not all, of his lectures referred to both, even though the tide of any given lecture might have referred to only one. He maintained that the singleness of the single tax logically precluded all other taxes, including customs duties, and therefore logically precluded protection. If the single tax raised all the revenue needed by government, it would render a protective tariff unnecessary for revenue raising. He saw both free trade and equal rights to land as manifestations of the one principle – the principle of economic and political freedom. Equal rights to land would bring freedom from the power and exploitation exercised by landlords.
For George, full development of the potential of individuals and societies required both free trade and equal rights to land. Both were necessary, but neither alone was sufficient. He regarded monopolies as the great enemy of progress, whether monopolies stimulated by protectionism or monopolies created by the unequal ownership of land and other natural resources. The two policies of free trade and land-value taxation thus share a common basis and are mutually supportive. But in a curious way the two policies can be antagonistic, with the policy of land-value taxation damaging the free-trade cause. The Australasian newspaper argued that landowners who might otherwise favour free trade were becoming protectionist because of George’s single tax policy, hoping that if sufficient public revenue were raised from customs duties, the land-value tax would become unnecessary. According to the Australasian reporter, free traders in Australia “heartily wish that Mr. George had remained on the other side of the world” (March 22, 1890).
By linking his argument for free trade with his argument for equal land rights, George was able to deploy either or both arguments to meet objections. For example, in Melbourne on March 26 when it was alleged that protection had encouraged economic growth in Germany, he responded by arguing that German wages were low and working conditions were poor, and that this was due to the protectionism. But when it was alleged that wages were low in free-trade England, he responded by arguing that this was due not to free trade, but to land monopoly. The dual arguments for land rights and free trade enabled him to select the appropriate causal connection and thus dismiss any observed correlation that appeared to contradict his position.
State Ownership Versus Private Ownership
One of the principles behind George’s policy of land-value taxation was the a priori perception that the land belongs to the people, or that the people have equal rights to land. This has been interpreted as a policy of land nationalization. He was often referred to as an advocate of land nationalization, and his supporters sometimes gathered in “Land Nationalization” societies.
Questions raised at the Goulburn meeting on March 20 elicited some interesting responses on state ownership. Asked, “Wouldn’t it be best if the state were the sole landlord …?”, George’s reported reply was, “I have no objections to make the state the sole landlord”. He recognized that if land were rented out by the state, the effect would be same as if the single tax applied. But he added that the single tax would be simpler and easier, with fewer opportunities for corruption and evasion, and therefore, “I don’t think it would be a good thing to make the state formally the sole landlord” (Goulburn Evening Penny Post, March 22, 1890).
A similar view on land nationalization was expressed in an interview at Adelaide: “I am not a land nationaliser in the narrow meaning of the term. That is to say, I don’t think it wise for a community to hold land formally and lease it out again to tenants” (Adelaide Observer, April 26, 1890).
George’s position on land nationalization was therefore not clearly defined. Was it his first-best preference? Did he prefer it on principle but reluctantly discard it in favour of land-value taxation as his second-best preference because of the political difficulty of implementing land nationalization?
However, George was unequivocally and emphatically in favour of state ownership of the railways. He complimented Australia for being ahead of the United States in this regard. This view appears to have been based not on an a priori or ideological preference for state ownership over private ownership, but on a pragmatic assessment of the economic consequences of private ownership of natural monopolies:
I think the line between the State and the individual is perfectly clear. Wherever competition is possible, the State ought not to interfere. Where competition becomes impossible, and a thing becomes in its nature a monopoly, it passes into the functions of the State. (Lecture at Goulburn, March 20, Goulburn Evening Penny Post, March 22, 1890).
He praised the people of South Australia for running their railways, not as “the property of the monopolists” (as in the United States), but as “the property of the whole people” (Adelaide Observer, April 26, 1890). He was also in favour of state ownership of the telegraph system (lecture at Cootamundra, March 21: Cootamundra Herald, March 26, 1890).
But in situations not involving either land or natural monopolies, his clear preference was for private enterprise and private ownership. He did not advocate a direct Keynesian-style public works program to cure unemployment. Instead he preferred state-sponsored measures that would boost trade and thereby encourage employers to employ.
In his published works, George had argued that private ownership of land should be replaced by private possession (with security of tenure). He believed that the essential characteristic of private ownership of land is the ownership of the land’s value, and that by taxing the land value, private ownership would be converted into private possession, thus avoiding the need for and expense of formal nationalization of land. However, in Geelong he was reported as saying that the single-tax men “would leave the ownership of the land as it was at present” (Geelong Advertiser, April 7, 1890), and in an interview in Adelaide on April 26 he was reported to have made the following interesting but confusing comment:
The form of ownership that seems best is that of fee-simple, with a reservation of course to the community of the right to take in taxation all value which attaches to the land by reason of the growth and progress of the community. (Adelaide Observer, April 26, 1890).
Unfortunately, the interviewer did not ask him to clarify his distinction between private ownership and ownership in fee-simple. As argued elsewhere (Pullen 2001), his reform might have had wider appeal if he had described it as a system of fee-simple, or private property, with the qualification that land-value increments should be shared equally throughout the community, rather than describing it as the abolition of private property.
In conclusion, what would George say if he were able to undertake a second lecture tour of Australia today? He would no doubt be delighted to see the floating dollar and the progressive reduction of tariffs. He might not be so pleased to see the trend toward privatisation of government-owned transport and communication systems. And he would be absolutely appalled to see the enormous “unearned increments” occurring in land values in the larger cities, especially the increments that escape both capital gains tax and income tax and do not therefore contribute anything toward public revenue. In 1890 he deplored the “monstrous inequality in the distribution of wealth” (Cootamundra Herald, March 20, 1890) that he witnessed in Australia, the United States and other countries. He might reuse that expression when seeing in Australia today the increasing gulf between the propertied and the propertyless; between those who have a less than equal share (or not share at all) of land and other natural resources, and those who have a more than equal share; and between those who can exploit their ownership of urban land and those whom they exploit.
With land ownership much more widespread than in 1890, and with landowners enjoying rapid and incredible increases in their land values, he might find it more difficult to convince his audiences of the virtues of a land-value tax, even one accompanied by the abolition of all other taxes. He seems not to have envisaged a situation in which the majority of people are landowners. It would be interesting to see whether, with all his oratory, he could convince Australian landowners that they are unjustly confiscating more than their equal share of the nation’s land value and depriving the rest of the community of its right to an equal share.
Henry George’s Lectures and Sermons
In Australia, 1890: An Itinerary