California to North Dakota and Way Beyond
Single Tax principles were the driver for an agricultural revolution in rural California, expanding cultivable land to four million acres by 1927 and building the highest dam in the world at that time (Don Pedro, on the Tuolumne River in the Sierra Nevada) financed completely on Georgist principles. Albert Henley, a lawyer who was involved in the development of metropolitan San Jose, evaluated the way the Single Tax worked in California:
The discovery of the legal formula of these organizations was of infinitely greater value to California than the discovery of gold a generation before. They are an extraordinarily potent engine for the creation of wealth.
Infinitely greater value than gold. California rose to agricultural ascendancy among American states, taming vast tracts of desert and bringing it into production. Mason Gaffney has unearthed the buried story of how California’s application of the Single Tax was a huge generator of farm employment and homes, its Central Valley blooming into 7,000 independent farms, while other states were destroying their land’s potential by latifundiazation, a process discussed in Poverty and Progress, from the Latifundi, the great estates of the Roman Empire in its decadent and declining stage. (read the book.) Single Tax principles are the secret story of how the semi-arid land of the Californian plains became the bread basket of America.
Anywhere Henry George’s remedy is released, everything flourishes. It’s like throwing seeds in the air and running for cover. It is bang to rights, it is irrefutably guilty as charged. But there were forces hell bent on ignoring this, writing it out of the story. Mason Gaffney describes his own research on this stellar Californian success.
If this is a "minor" phenomenon it is because the neglect of historians and economists has made it so. One searches in vain through academic books and journals on farm economics for recognition of this, the most spectacularly successful story of farm economic development in history. What references there are consist of precautionary cluckings focused on attendant errors and failures. "Economic development" theorists neglect it altogether, as though California's commercial farming had sprung full blown from a corporate office, with no grass roots basis, and no development period. It is as though the clerisy were in conspiracy against the demos, under some Trappist oath against disclosing what groups of small people achieved through community action, and through the judicious application of the pro-incentive power of taxing land values.
We keep mentioning California. As well as everything else, it has to be mentioned that it’s a worrying place these days.
In other states, also, different bodies were advocating for Single Taxer principles, and the state of North Dakota adopted them. Out in the wide prairie lands, the movement called Prairie Populism prospered, and spread into Canadian provinces, all using a moral tax principle. In 1916, this movement, in the form of the Non-Partisan League, took the governorship of North Dakota, and again in 1918, taking control of the legislature. At this time they set up the Bank of North Dakota, the only state bank in the USA. And it’s still there, and in America, of course, it’s often called a Socialist bank. It’s still there and, strangely in these severely straitened times, it’s thriving, as North Dakota seems to be.
And they built the North Dakota Mill, also thriving, which is a state-owned milling facility and the largest flour mill in the USA. The wheat growers of the Populist movement had it built to counter the Railroad’s exploitation of them. We don’t know it as a fact, but we feel quite sure this mill will have been paid for with legitimate taxation.
We never really knew or heard anything about North Dakota before. The Non-Partisan League, eventually absorbed into the Democratic Party, wanted to insulate North Dakota from the rapacious power of banks and corporations, and it seems they succeeded. To this day, their anti-corporate laws still stand, that prohibit a bank or a corporation from owning land deemed as farmland (as nearly all of North Dakota is.)
(The third vid on this page, featuring Bill Still, has much more interesting stuff about North Dakota.)
JB Clark is a hugely influential American economist who lived in the countryside during this era of Prairie Populism and wrote about the period, and Gaffney says of him:
It would seem that J.B. Clark's allusions to "agrarian socialism" had some basis in fact - he had spent some years in Northfield, Minnesota, in the heart of it. Clark just gave it the wrong name.
Indeed, the wrong name. And it was standard in the USA in these days, and when Henry George was alive, to discredit George’s ideas by labelling them as Socialist. It is not Socialism, and it’s not Capitalism. It’s the best of both minus the worst of both.
This band will keep saying that Georgism is more truly Capitalist than Capitalism as we’ve ever known it, and it is more truly Socialist than Socialism as we’ve ever known it. It is the full remedy.
There really is a vast amount more of this American story, as Gaffney says, those are just straws in the wind. In this period of American history, followers of Georgist ideas included hundreds of local and state politicians, and a handful of powerful national politicians, both in the USA and Canada.
Outside of America, the seed corn of George’s ideas were being carried on the winds around the world, that he had circumnavigated in spreading his teaching. Here and there, they would take root to an extent. Amidst the current of turbulent historical events, these ideas would come close to blossoming into great trees in Britain and in China, perhaps Russia, establishing footholds in Australia, Denmark, Hungary and lots of other places. Much more of this later.
The great optimistic thing is, the idea never dies. The truth of it is always there. Every time these principles are used, they always work, it always has the same seemingly magical effect, and the truth continues to be rediscovered every now and then.
We confess that we didn’t know at first that Baja California is in Mexico and not in the USA, but it’s only a little over the border and American stories can certainly stretch into Mexico.
In the 1990s, the Mayor of Mexicali, Baja California, a city in need of some infrastructure, replaced some existing taxes with a just tax. It was persisted with, and revenue for the mayor rose twenty-fold, and nobody complained, because everybody could see they were better off. And this is the point, once everybody, everybody, can see this cat, then we’re laughing. Mexicali’s neighbours were taking note. (And we’ll confess, we haven’t followed the story up to see what happened, but from a cursory glance things look okay, infrastructure seems to be in place.)
It’s not clear whether the Mayor of Mexicali had read Progress and Poverty, or whether the principles were stumbled upon. The basic truth is always there to see, as many always have done.
When conditions are just, Adam Smith’s magical invisible hand does the rest, nothing else is needed. Do it this way, and success for all happens. So, surely there is an inevitability of history here! It’s amazing magic, surely this can’t be suppressed forever. It can look very bleak at the moment, but it can be optimistic as well, because the idea can’t be extinguished, because it’s an eternal truth, as Henry George said it was.
There certainly can be optimism; all the great reforms for human emancipation and liberty have come about only in the last two centuries, what could another two centuries bring? Other than ecological catastrophe, of course. We’ve got to get positive about that, as well.
Actually, at a time when these notes were being pondered, a neighbour visited, and we mentioned this website, then with just its front cover, and tried to explain, in ways we’re trying to perfect . . . and the point is, people do know that it’s wrong as it is, like our neighbour just said, I’ve always known the way the world is set up is crap. But the thing is putting your finger on just why, we said, sensing an interest, and we pointed out that it had all been explained. Of course, there was a copy of Progress and Poverty handy. People do know in their hearts that something is not right in the way the world is. Anyway, if he does read it, that counts as the first one for this site’s score.
Dr Joseph Milne summed up these feelings for us here:
. . . and so mankind lives blindly within his cosmic setting and calling, discontent because his intelligence tells him faintly that something profound is amiss in the ordering of society. Man knows he is not yet truly himself or free. This knowing is the calling in his own nature to discern the true nature of society within the natural order of things.