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The Last Tax: Henry George and the Social Politics of Land Reform in the Gilded Age and Progressive Era

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The Last Tax: Henry George and the Social Politics of Land Reform in the Gilded Age and Progressive Era The Last Tax: Henry George and the Social Politics of Land Reform in the Gilded Age and Progressive Era A Dissertation Presented to The Faculty of the Graduate School of Arts and Sciences Brandeis University Department of History Michael Willrich, Advisor In Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy By Alexandra Wagner Lough August 2013 This dissertation, directed and approved by Alexandra Wagner Lough’s Committee, has been accepted and approved by the Faculty of Brandeis University in partial fulfillment of the requirements for the degree of: DOCTOR OF PHILOSOPHY Malcolm Watson, Dean Graduate School of Arts and Sciences Dissertation Committee: Michael Willrich, Department of History Mark Hulliung, Department of History Daniel T. Rodgers, Department of History, Princeton University Copyright 2013 Alexandra Wagner Lough Doctor of Philosophy Acknowledgments This project properly began in 2004 when I was an undergraduate at the University of Pacific in Stockton, California and decided to write a history thesis on Henry George. As such, it seems fitting to begin by thanking my two favorite professors at Pacific, Caroline Cox and Robert Benedetti. Their work inspired my own and their encouragement and advice led me to pursue graduate work in history at Brandeis University. I am forever grateful for their support. I consider myself extremely fortunate to have been admitted into the Ph.D. program in American History at Brandeis. Not only have I received top-notch instruction from brilliant faculty, but I also have received generous funding. I want to extend my gratitude to Rose and Irving Crown and the Crown family for the fellowship that financed my graduate education. I also was fortunate to receive a Dissertation-Year Fellowship from the Andrew W. Mellon Foundation that allowed me to complete this dissertation in a timely manner. This project has greatly benefited from the advice and support of my dissertation committee. For the past six years, my advisor, Michael Willrich, has encouraged and improved my work through his feedback and suggested revisions. Professor Willrich has read numerous drafts and made countless edits that have strengthened and clarified my historical analysis. Similarly, Professors Mark Hulliung and Daniel T. Rodgers provided incisive and detailed comments that both challenged and confirmed my historical discoveries. I am indebted to my dissertation committee for the time and effort they spent in helping this project come to fruition. iv In addition to amazing faculty and staff, Brandeis attracts remarkable students. I am grateful for the lifelong friendships I have made at Brandeis. In particular, I am tremendously lucky to count Clara Altman, Winston Bowman, Julian Nemeth, Aaron Wirth, Joby Decoster, and Josh Cracraft as friends and colleagues. I will forever cherish our time spent together in class, Usdan cafeteria, at Einstein’s, and of course, the Gaff. In addition to amazing friends, I have been blessed with a wonderful family. My father, Michael Wagner, first introduced me to Henry George when I was looking for a topic for my undergraduate history thesis. I am forever grateful for his suggestion but even more so for his unwavering support, encouragement, and interest in my work. My father is a remarkable writer and an equally talented editor. I have learned so much about the fundamentals of strong writing and storytelling from his edits and comments. My mother, Stephanie Walsh, and sister, Melanie Banfield, have provided me with much needed distractions from the drudgery of dissertating. They have allowed me to vent and reminded me that there is life beyond my computer screen. Over the past six years they have transcended their roles as mother and sister; they have become my two closest friends. My husband Casey deserves the highest accolades for loving, supporting, and inspiring me every day. He has made countless sacrifices including leaving behind the eternal sunshine of California for the snowy winters of Boston, to allow me to pursue my dream of becoming a history professor. Casey is my biggest fan and closest advisor; I could not have completed this dissertation without him. v ABSTRACT The Last Tax: Henry George and the Social Politics of Land Reform in the Gilded Age and Progressive Era A dissertation presented to the Faculty of the Graduate School of Arts and Sciences of Brandeis Waltham, MA By Alexandra Wagner Lough In the aftermath of one of the nation’s worst economic disasters—the economic depression of the 1870s—the California journalist Henry George strived to understand a distinctive dilemma of modern industrial capitalism: how could an era of unprecedented economic growth and industrial output produce widespread poverty, unemployment, financial panic, and acute inequality of wealth? The result of George’s investigation was Progress and Poverty (1879). The book challenged widely accepted doctrines of property rights and laissez-faire and changed the way many people thought about and understood the political economy. George proposed a deceptively simple solution to the problems of economic inequality and industrial depression. In contrast to other social commentators of his era, who attributed economic disruptions to overproduction or unsound monetary policies, George singled out one of the most cherished institutions of liberal capitalist societies: private property in land. He called for the replacement of all federal, state, and local vi taxes with one tax on the full value, or market price of land—a proposal that became known as “the single tax.” Unlike the general property tax which taxed the value of land and buildings, the single tax only applied to the value of land. Furthermore, the single tax only reached land upon which value had attached as a result of location and natural fertility. Although the single tax was never fully implemented anywhere in the world, George’s concept inspired and animated many of the most notable social reform movements of the era of high industrialism including socialism, labor activism, and the Social Gospel. More than any other late-nineteenth century reformer, George reintroduced land and the concept of economic rent into political economic debates that had in recent years become heavily focused on the clash of capital versus labor. As a result, the issues of land ownership and land distribution remained important components of Gilded Age and Progressive Era reforms and policies. vii Table of Contents Introduction 1 I. Henry George, Progress and Poverty, and the Origins of the Single Tax 36 II. Land Nationalization, Socialism, and the Single Tax in the British Isles 86 III. Land Reform and Labor Activism: Henry George and the New York City 142 Mayoral Campaign of 1886 IV. The Single Tax and the Social Gospel 184 V. The Single Tax and the Municipal Ownership Movement in Cleveland, Ohio 236 VI. A Simulated Single Tax: The Early Histories of America’s First ‘Full’ Rental 282 Enclaves at Fairhope, Alabama and Arden, Delaware Conclusion 327 Bibliography 331 viii List of Tables Collected Land Rents, 1900-1906 302 ix List of Illustrations Henry George, 1897 35 Completion of the Pacific Railroad, 1869 51 A large mob in Denver, Colorado beating and destroying the property of Chinese on October 31, 1880 60 The Organic School, 1913 312 Marietta Johnson, 1912 312 Two views of Arden gate, 1922 315 Frank Stephens as a young man, no date 325 Frank Stephens in his studio, 1920 325 Photo of a family at work in Arden, circa 1900 325 x Introduction In the aftermath of one of the nation’s worst economic disasters—the economic depression of the 1870s—the California journalist Henry George (1839-1897) strived to understand a distinctive dilemma of modern industrial capitalism: how could an era of unprecedented economic growth and industrial output produce widespread poverty, unemployment, financial panic, and acute inequality of wealth? The result of George’s investigation was Progress and Poverty: An Inquiry into the Cause of Industrial Depressions and of Increase of Want with Increase of Wealth. The Remedy (1879). The book challenged widely accepted doctrines of property rights and laissez-faire and changed the way many people thought about and understood political economy. By the close of the nineteenth century, Progress and Poverty had become an international bestseller and ignited a transnational land reform movement designed to end poverty in the modern industrial world. Henry George proposed a deceptively simple solution to the problems of economic inequality and industrial depression. In contrast to other social commentators of his era who attributed economic disruptions to overproduction, under-consumption, or unsound monetary policies, George singled out one of the most cherished institutions of liberal capitalist societies: private property in land. He called for the replacement of all federal, state, and local taxes with one tax on the full value, or market price of land. His 1 proposal became known as “the single tax” and those who supported it were called “single taxers.” The single tax was neither a property tax nor a land tax. Unlike the general property tax which taxed the value of real estate (land) and personal property (buildings), the single tax only applied to the value of land. Furthermore, the single tax only reached land upon which value had attached as a result of land’s location and natural fertility. Under the single tax, land without value would not be taxed. Taxing only land values would generate all the revenue needed to operate government, George believed, and doing so would produce ever greater levels of opportunity, as man’s right to the bounty of nature and his desire for a productive life was strengthened. Taxing only land values, George believed, would ameliorate and one day eliminate the hardship caused by continually bursting bubbles of land speculation. Finally, taxing only land values was not just the application of sound public policy, but the acknowledgement of a spiritual duty.
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