The Political Crisis of the 1890s
|Digital History ID 3122|
Henry George wrote the most influential American economic treatise of the 19th century. Entitled Progress and Poverty, and published in 1879, it was translated into 25 languages, outsold Karl Marx's Das Kapital, and inspired H.G. Wells and George Bernard Shaw to become Socialists.
Henry George was convinced that all of the society's ills were rooted in rising land values, which prevented the poor from acquiring property, reduced farmers to tenancy, and discouraged investment. He believed that society was responsible for increases in land value and that it was unfair for landlords alone to profit from this increase. He claimed that a tax on land would penalize those who leave land idle, and would therefore encourage investment and eliminate poverty and unemployment. As he put it:
What I propose, therefore, is the simple yet sovereign remedy, which will raise wages, increase the earnings of capital, extirpate pauperism, abolish poverty, give remunerative employment to whoever wishes it, afford free scope to human powers, lesson crime, elevate morals, and taste, and intelligence, purify government and carry civilization to yet nobler height.
At the age of 14, George left his home in Philadelphia and migrated to San Francisco, where he became a successful journalist. Dismayed by the "shocking contrast between monstrous wealth and debasing want," he wanted to understand the explanation for "advancing poverty with advancing wealth." He believed that the problem was that wealth was accumulated by landlords rather than those who actually produced wealth. Rather than investing in productive enterprise, the wealthy speculated in land. This was the theme of Progress and Poverty.
After his book brought him international fame, he moved to New York in 1880 and ran for mayor as an independent in 1886. He lost, because he was unable to convince the working class that his scheme would benefit them, but he did finish ahead of Theodore Roosevelt, the Republican candidate. He ran again for mayor in 1897, but died before the election. He was 58 years old.
Although George's single tax on land was simplistic, his goal was not nonsensical. He wanted to use tax policy to narrow the gap between rich and poor and to encourage productive investment. He was also among the first advocates of urban planning and rational land use policies.
In 1894, 28 people from Iowa moved to Alabama, and established a community founded on George's ideas. The community's land was held by the community, who paid only a single tax to cover public services. Today, the community still exists, leasing land to 1,300 farmers, business owners, and homeowners, and remains as a reminder of Henry George's utopian ideas.