108. ARGUMENTS AGAINST THE SINGLE TAX.—The most important objection to the single tax is that the confiscation of land, or, what amounts to the same thing, the confiscation of the income which land yields, is unjust. "Pieces of land," Professor Seager points out, "have changed hands on the average dozens of times in the United States, and present owners have in most cases acquired them not as free gifts of Nature, nor as grants from the government, but by paying for them, just as they have had to pay for other species of property." Where individuals have acquired land in good faith, and under the protection of a government which guarantees the institution of private property, the confiscation of land value would be demoralizing to the community and unfair to its land-owning citizens.
Another difficulty lies in the ease with which value due to permanent improvements is confused with value due to location or fertility. Where money has been expended in draining land, removing stones or applying fertilizer, it is hard to tell, after a few years, what part of the value of the land is due to improvements. The possibility of this confusion would cause some land-owners to neglect to improve their land, or might even cause them to neglect to take steps to retain the original fertility. Thus the single tax might result in the deterioration of land values.
It is also objected that the single tax would provide an inelastic taxation system. This means that it would tend to bring in an equal amount of revenue each year, whereas the revenue needs of government vary from year to year. A good tax system will accommodate itself to the varying needs of the government, always meeting the expenses of government, but at the same time taking as little as possible from the people. [Footnote: Some opponents of the single tax declare that the heaviest possible tax on land would yield only a fraction of the revenue needed to finance the government. Single taxers, however, maintain that the tax would yield more than enough revenue to meet public expenditures. The merits of this argument are uncertain.]
It is doubtful whether the single tax would force into productive use land now being held by speculators. Even though a heavy tax were laid upon such land, it would not be utilized unless there were an immediate use to which it could profitably be put.
A last important argument against the single tax is that there is no good reason for removing the tax burden from all except land-owners. Land is only one form of wealth, and it is unfair not to tax individuals who hold property in some other form. Some land value is indeed unearned, but there are other forms of unearned wealth, as, for example, monopoly gains and inherited property. Taxes ought to be levied upon these forms of unearned wealth, as well as upon the unearned income from land. It is desirable, too, to levy at least a light tax upon the propertyless classes, in order to encourage them to feel an interest in, and a sense of responsibility for, the conduct of their government.
109. SERVICE RENDERED BY THE SINGLE TAX AGITATION.—Economists are unanimous in agreeing that the single tax, as expounded by Henry George, is too drastic and special a reform to find wide favor. Nevertheless, the single taxers have performed a valuable service by emphasizing the fact that in many cases the income from land is largely or entirely unearned. It would be manifestly unjust to dispossess present-day land-owners who have acquired land in good faith; on the other hand, most economists agree that we ought to reform our tax system so as to take for the community a larger share of the future unearned increment of land values. As Professor Taussig has pointed out, no one has a vested right in the indefinite future. The taking of this future unearned increment, it is hardly necessary to add, would not constitute a single tax, but rather a heavy land tax. Many other taxes would continue to be levied. [Footnote: The general problem of taxation is discussed in Chapter XXXIL]
QUESTIONS ON THE TEXT
1. Define the single tax.
2. What is location value?
3. Define fertility value.