1. Georgism Used To Be Popular During The Late 19th And Early 20th Century
The Georgism movement used to be as popular as the Eugenics movement was during the early 1900s, and Georgism was a major part of activism during the Progressive Era.
Henry George’s 1879 book Progress & Poverty was the second best-selling book in the entire world during the 1880s and 1890s, outsold by only the Bible. Nobody knows exactly how many copies it sold during those two decades since nobody was keeping track, but it definitely sold at least several millions of copies for sure. The Progressive Era is literally named after the book itself.
Georgism used to have millions of followers, and many of them were very famous people. When Henry George died in 1897 (just a few days before the election for New York City mayor), an estimated 100,000 people attended this funeral.
The mid-20th century labor economist and journalist George Soule wrote that George was “By far the most famous American economic writer,” and “author of a book which probably had a larger world-wide circulation than any other work on economics ever written.”
Few people know it, but the board game Monopoly and its predecessor The Landlord’s Game were actually created to promote the economic theories of Henry George, as noted in the second introduction paragraph of the Wikipedia article on board game Monopoly. The board games intend to show that economies that eliminate rent-seeking are better than ones that don’t.
So if Georgism used to have millions of supporters and solid economic reasoning, why did it never catch on and how did it lose its popularity over the past century?
2. Reasons Why Georgism Lost Its Popularity As The 20th Century Progressed
A century’s worth of successive mistakes in the making, these are the main reasons why Georgism lost its popularity as the 1900s progressed:
The rising popularity of automobiles, especially the Ford Model T, placed downward pressure on land values. The high cost of living in urban centers was historically more noticeable than it was today, until the automobile made it possible to expand cities outward and create urban sprawl. The development of the national highway system during the 1950s further increased the United States’ reliance on cars.
- City Beautiful: How do cities grow?
- TL;DW: Cities grow according to what becomes the most dominant transportation method. Since cars became the dominant transportation method and high-speed rail did not, car-centric urban planning became prevalent instead. The modern consensus is that car-centric urban planning has been a failure for building optimal, sustainable, and environmental cities. Now that we’re stuck with car-centric urban planning, this will make it significantly more difficult to achieve pro-Georgist reform.
- People may be able to enjoy the lower cost of living that’s made possible by living on lower-value land (and even land speculating), but this actually curtails economic growth in the long-run.
- Generally speaking, the US has always used the Manifest Destiny as an excuse to not consider land scarcity. Now that there’s no more land to manifest and most of the country’s cities have car-centric urban planning, economic growth is being massively stunted from what it could’ve been.
- The rise of mortgages made it easier for the middle class to land speculate. When Georgism was popular, the rentier class was small. Now that the rentier class is big, support for Georgism is small. The government, word-of-mouth, and personal financial advice like “homeownership is the key to the wealth” have made the problem worse by encouraging this rent-seeking. Today, the majority of the population engages in some type of land speculation through the property and mortgage market.
- Each mortgage is a speculative bet on the future value of the house. Buying land has become the most popular way of securing capital. While that leads to a lot of problems, taxing land value would cause the middle class to lose what they invested their life savings into (the land their houses sit on).
- When land economics is explained to most people, they don’t care to understand that land speculation is the problem with the economy. They only care about how they could use it to make themselves better off, so they don’t realize that it actually makes everybody collectively worse off in the long run. Many homeowners have never bothered to understand Georgism outside of a NIMBY perspective because it would negatively affect the value of their home.
- Given these circumstances, any modern attempt to implement Georgism nowadays would have to see a gradual transition of at least 30 years away from other taxes (starting with property taxes), coupled by a gradual increase in LVT until land value is taxed at a 100% rate. 30 years would be an entire generation, and should give everyone enough time to readjust their personal finances as the society transitions to Georgism.
- Keynesian, Fascist, and Communist ideologies became popular in America and Europe during the 1930s and 1940s, thus distracting the public from Georgist solutions to the Great Depression and other economic woes. Even worse, Keynesian ideas were credited with ending the Great Depression, and Keynesianism eventually became the dominant school of economic thought in the Western World.
- Prohibition caused the US government’s revenue to switch from dependence on liquor excise taxes to dependence on income taxes. When FDR increased the size of the US federal government during the 30s and 40s, sales, property, and especially income taxes grew, but taxes on land and natural resources were never considered.
- The Cold War polarized the world between Neoclassical Economics and Marxist Economics. This created the Capitalism-Communism Dichotomy, while further burying Georgism into the history books and distracting the public. By this point, most of the Georgists from earlier decades had already died off.
- Henry George died of a stroke in 1897, just four days before the 1897 NYC mayoral election. He also placed second in the 1886 NYC mayoral election, which was a three-way race. Since he wasn’t able to win either election or further spread his ideas a decade or so into the 1900s, this was another setback for the movement.
- The Kuomintang was initially a Georgist party, and Sun Yat-Sen was also a Georgist who became the first head of state of the Republic of China in 1911. However, Yuan Shikai became the new head of state the next year, failed to reinstate monarchy in China, abdicated, and died, thus causing China to fragment into different territories controlled by warlords from 1916 to 1928. After the warlord era ended, the Chinese Civil War began and the Communists defeated the Nationalists. This is even more unfortunate when considering how a nationwide implementation of Georgism in China could’ve dissuaded people from supporting Communism in the first place. Today, Taiwan has some land value taxes, but it’s nowhere near being a Georgist taxation code.
- According to Mason Gaffney, rich land barons like Leland Stanford funded the first economics departments at US universities and staffed them with avowed anti-Georgists, who created neoclassical economics with the express purpose of rewriting all of economics terminology to confound Georgist arguments and erase Henry George from history. Unfortunately, they succeeded. This is explained in more detail in this excerpt from Gaffney’s book: Neo-Classical Strategem As A Strategy Against Henry George. All of Academia has been compromised in general.
- High school students tend to be taught Keynesian Economics and Supply-Side Economics. Georgism is hardly mentioned at all in most high school history and economics textbooks.
- Georgism is not intuitive enough for the general public to understand, nor does it evoke the emotions necessary for catching people’s attention and dawning activism. For the most part, it benefits everyone equally, so there is no special interest group to put money into promoting it. Georgism is not messianic, so it lacks the quasi-religious appeal of Marxism and ’the end of history’. To top it off, Georgism confronts the notion of private property in land, a system so deeply entrenched into modern culture that most people will never even conceive that there might be an alternative to it. Memes and cultures evolved to think about labor and “investments”, not land.
- Nowadays, there are hardly any famous Georgist advocates and intellectuals who have enough influence to draw the public’s attention towards it. Nearly all the famous Georgists noted in the Georgism Wikipedia article are dead. Nowadays, people are massively divided by filter bubbles, especially due to the rise of the internet and increased political polarization. Most people have never heard of Georgism, and most of those who have heard of it don’t understand it. There are also no major news outlets that publish Georgist ideas and arguments for the public.
3. Ideas For Re-Popularizing Georgism
Georgism was popular once, and it can be popular again. The modern era has exhausted both its solutions and its revolutions, and people are beginning to look for ways to fix the problems unfolding in front of them.
- The growing popularity of the FIRE Movement could help to counteract people’s opposition to Georgism. Since the FIRE Movement aims to help people build up all their retirement savings earlier in life so they can retire at earlier ages, say in their 30s or 40s, this could help people become less reliant on owning homes as part of their retirement plans.
- People who support supply-side economics might be some of the easiest people to convert to Georgist economics. The Laffer Curve assumes that the government has to be funded by a tax that decreases economic output, but this is made obsolete since collecting Land Value Tax instead would not decrease economic output. Almost all of the users on r/neoliberal support Georgism, so we know that they are some of the people who are already the most receptive to this idea.
- Worsening housing and rent problems in California, Canada, major metropolitan areas, Japan, China, and other places that are facing housing shortages could ignite support for Georgism. The key will be to market it as the best solution to the housing crises.
- Restructuring urban planning to be more walkable and less reliant on to cars would help, but this would take decades, at which point, cars would be both electric-powered and self-driving.
- Educating people about economics. Although Georgism may not be intuitive, we can still try to recruit people who wade great influence to help promote it, like educational Youtube channels that have millions of subscribers. The YIMBY movement is crucial for making Georgism a reality.
- Educating people about Biological Realism. In my personal experience, when people fully understand population dynamics, they tend to be more supportive of Georgism. This is because there is a surprisingly coherent and interesting Connection between Georgism and Population Control, since both concepts aim to conserve resources and deal with natural resources that exist in fixed supply.
- Understanding Why It’s So Difficult To Change People’s Minds. In order to change other people’s minds, we have to first understand epistemology, belief networks, social dynamics, and much more. Related Reading: A Brief Taxonomy of Online Anti-Georgism.
- Understanding the Sapir-Whorf Effect. Language has the potential to influence when it’s used meticulously, due to classical conditioning, selective attention, and other factors. Much of today’s language works against Georgism, but there are ways to use language that would make it more persuasive and palatable to dissenters.