Oscar B. Johannsen
[Reprinted from The Analyst, October, 1962]
One of the important questions which will arise if any society
collects the full economic rent is to determine how it shall be
distributed among the people.
Henry George said in Progress and Poverty: "This revenue
... could be applied to the common benefit
we could establish
public baths, museums, libraries, gardens, lecture rooms, music and
dancing halls, theatres, universities, technical schools, shooting
galleries, play grounds, gymnasiums, etc." [p. 456]
But is this wise? It may well be that the way in which the rent is
distributed could have a very important effect on whether or not the
efficacious results of its communal collection were achieved.
If the funds were dispersed for such functions as those mentioned,
what would it mean? First, it would mean the creation of a vast
bureaucracy to carry them out. Second, it would lead to squabbles-as
to how much should go to one function and how much to another, the
fact that people would be constantly suggesting more and more
functions which should be subsidized by the rent fund. Third, it would
mean that the distribution of the fund would not be equitable to all,
for some people would make little or no use of many of the functions,
although part of their share of the rent would be applied to them.
Fourth, with this fund at the disposal of the various bureaucracies,
they would be in a position to give out important contracts, with all
the dangers of corruption involved.
The result would appear to be that socialism might creep in through
the back door. While at first, when such functions as libraries are
conducted by means of the rent fund, there would be little harm done.
Yet with the proliferation of functions, the danger would increase
tremendously. Ultimately, the rent fund would not be big enough, and
the result would be the taxation of wealth.
In other words, the State would become bigger and bigger, and without
the people realizing it socialism would become the order of the day.
Well, how should the rent be distributed? This writer believes it
should be distributed on a per capita basis. Whatever the rent fund is
on say the first of January should be divided up equally among all
those alive on that day -- men, women and children. This would be
absolutely equitable, as then the people could do with the money as
they chose. The could use it to become members of private libraries,
to pay for their schooling at private schools. They could use it to
pay the annual fee to use particularly private roads in their
neighborhood if the businesses operating them set up such an
arrangement. They could squander it if they wished.
There would be certain mechanical problems of determining just who is
entitled in a particular area, but no greater than the problem in
determining who is eligible to vote. If a man died his estate would
get it that year. The rent belonging to immature children would go to
But no powerful State would arise from it, for there would be no
bureaucracy to do for the people things which they could do better
themselves. The only bureaucracy would be the one collecting and
dispensing the rent fund. If this were done on the local level, just
above the family, it could be controlled, as it would be under the
eyes of the people themselves.
In the last analysis, the solution of this problem must answer two
questions: Is it wise? Is it just? It seems to the writer that it is
wise, for it makes the collection and disbursement of the rent fund as
simple as possible and with the creation of the smallest amount of
government to administer it. That it is just is obvious, for each
person receiving the same 'dividend,' there could be no possibility of
one getting more than another, such as would arise if the rent fund
were used to produce such particular things as bathhouses and
It must always be remembered that man seeks to satisfy his desires
with the least effort. Therefore, we must be careful that any
machinery set up to collect and dispense the rent fund be such that it
eliminates to the greatest degree possible the opportunity of some men
utilizing it to serve their own ends. Distributing the rent fund via
special functions makes it too easy for the Government to grow, makes
it too easy for ambitious men to use it to gain power over their
fellow men. And this is the very opposite of what George would have