We Forgotten The Foundation?
By Walter Rybeck
American Institute of Architects Conference on
"The Vital Role: Historic Preservation in Livable Cities"
WASHINGTON, DC - March 17, 2000
Americans owe a tremendous debt to architects and others who led the
movement to save and restore our nation's historic buildings and
My thesis today is that it is equally
imperative to restore our historic land policy that provided a
foundation for the flowering of wholesome cities and towns. Otherwise,
precious treasures saved by preservationists are in danger of becoming
isolated islands in an unsavory sea of urban ugliness, misery and
Land policy is rarely addressed in books by or about architects. For
most of the past century, political, scientists, sociologists, planners
and economists also typically failed to focus on land policy.
The 20th century beheld many things that should have boosted cities.
Despite all this, misconstrued land
policies led to a sharp decline in the character and quality of life in
our cities and towns. Sprawl ruined the landscape surrounding our
communities. Sprawl promoters and apologists say this is merely an
expansion of the American dream. To me, sprawl is more appropriately
recognized as an American nightmare.
- Designers and builders had striking new materials and engineering
capacities at their command.
- The city beautiful movement came on the
- The planning profession expanded.
- Federal urban programs were
- And at long last, citizen support for saving our heritage
Apparently we have suffered a kind of amnesia about our initial and
highly successful land philosophy. I'll try to sketch the essence of it
and suggest how architects and others can help restore the foundation,
as well as the superstructure, of our cities. We can't halt sprawl
unless we save our cities.
Early Land Policy
Life in early America was far from idyllic. Settlers experienced
extreme hardships. Public welfare to ease adversity was nonexistent.
The minimal level of our public amenities shocked foreign visitors.
Nevertheless, Americans developed an optimistic "can-do" spirit and
created the most dynamic and egalitarian society the world had seen to
date. In no small measure this phenomenon stemmed from factors related
Land hunger lured Europeans to the New World. To them, free or cheap
access to land spelled opportunity. With a few tools anyone could build
a shelter, garden, hunt, start a trade. With neither oppressive
governments nor landlords to expropriate their earnings, people willing
to apply themselves to nature's cornucopia could escape poverty. This
land-people relationship fostered the American work ethic.
Comparing the United States with South American nations is instructive.
Spanish and Portuguese conquistadors promptly took dominion over much
of the land. They used peon labor and plundered gold to create charming
cities, magnificent cathedrals and luxurious haciendas. This was at a
time when our colonists were still mostly in log cabins. We were the
backward nation, the developed nations were to the South. Before long,
however, their economies atrophied, even as ours burgeoned. A critical
difference explained why:
The United States during its first half century raised public revenues
predominantly from taxes on land values. Latin America hardly taxed
land at all. After Independence, the federal government played an
important but minor role. Its early budgets were unbelievably
meager--financed largely from export and import duties. It wasn't till
the 1930s that federal revenues exceeded local revenues. Initially,
cities, counties and states were our major governmental players. Their
tax of choice was the property tax--virtually their sole tax throughout
In that era, because average homes and shops were so modest, it is
important to underscore that the bulk of our local property tax revenue
represented a tax on the value of the underlying land.
Since the conventional property tax is in such ill repute today, it
needs to be clarified that this tax was not only a good source of
revenue. It was also a mechanism for allocating land in an equitable
manner. Let's recount the virtues of
the land tax from the perspective of our young country:
Unlike Latin America, which catered to land holding, our Founding
Fathers put a premium on small holders and land using. Heavy reliance
on the land tax nourished our market economy and supported the growth
of vibrant cities and towns from coast to coast as our experiment in
democracy took root.
- It required owners of the most productive sites to pay extra for
the privilege such lands conveyed.
- It eased the lot of poor citizens on marginal lands by requiring
little or no taxes from them and by giving them public protection and
services financed by favored owners of prime locations.
- It discouraged large unused estates. Owners (like George
Washington, who had obtained considerable holdings all the way to the
Ohio River) were induced to sell off excess land to minimize taxes.
- This increased the supply of land on the market, reducing its
cost for those who needed to use it.
- And it let the community recapture increased land values created
by the community -- as when tax-payers through their governments built
roads, canals and other public facilities. America was blessed not only
with vast land resources, but also with remarkable political
philosophers like Jefferson, Madison and Paine. They perceived that
sustaining political equality -- the most novel, radical and exciting
idea stirring the new nation -- required polices to assure universal
access to land.
The land ethic and land practices, which served our economy and cities
so well, sadly fell into disrepair. Here are five of the more important
It calls to mind the routine where Jimmy Durante got caught steeling an
elephant from a circus. A cop says, "Hey, where 'ya going with that
elephant?" And Durante replies, "What elephant?" A century later, few
question that we have an elephantine land problem.
- One: By 1900 the frontier was
The country was virtually all fenced in. Historian Frederick Jackson
Turner in the 1890s underscored the frontier's importance. Its free or
cheap land had been a safety valve for labor. Workers who felt
exploited could go West--strike out on their own.
- Two: Prodigious concentrations
of wealth materially altered the economic landscape. Some
of these were based on railway land giveaways. Most were tied to
natural resource monopolies -- of coal, timber, oil, cattle lands and
forth -- whose owners found ways to fend off land taxes.
- Three: A shift from local to
federal power occurred in the political arena. The
national government had to grow to save the Union and execute the Civil
War. It also expanded to combat abuses of giant combines and trusts. To
underwrite this growth, Congress turned primarily to tax-ing production
- Four: At the urging of land
monopolists who practically owned many state legislatures in the late
1800s, state governments discarded property taxes, replacing them with
income and sales taxes. Local governments also gradually began
to decrease their reliance on property taxes.
- Five: The property tax itself
was transformed. It became less a tax on land values, increasingly a
tax on improvements--that is, on houses, stores, offices and other
edifices on the land. These factors gave rise to slums, to
panics (as depressions were then called), and a widening gap between
the haves and have-nots. As a corrective, Henry George in his 1879
masterwork, Progress and Poverty,
urged Americans to address the land problem. He inspired a large
popular following, but many academics, politicians, economists and
captains of industry asked scornfully, "What land problem?"
However, too few have a clue about how to deal with land issues, or any
notion that archeological digs into our history might provide useful
answers. Instead, consider what's happening:
- Ecologists know it.
- Sprawl and crawl people know it.
- Many elected officials, homebuyers, and people trying to start a
farm or a business know it.
Urbanologists and the public need to be awakened to the central role
played by taxation. They need to see that loss of our historic land tax
has made speculation our top national sport -- a treacherous one at
that. As Hans Blumenthal wrote in Metropolis...and
Beyond (edited by fellow panelist on this program, architect
- Habitat volunteers build houses
for the poor, making recipients
and its volunteers feel real good. This is a fine example of
combined with self-help, and it spreads awareness of a great social
ill. But more housing is being abandoned and demolished than Habitat is
able to build.
- This same treadmill effect
undermines federal efforts. HUD has
spent billions on public housing, urban renewal and enterprise zones.
Some of these programs have retarded urban decline but their strongest
advocates would not claim they have come close to stopping or reversing
- Cities offer tax abatements to
revive decaying business
districts. Yet after new buildings are established, the cities
owners with the same tax burden that helped cause decay in the first
- Some builders turn to what I
call "designer sprawl." They mimic
old towns and are clearly less wasteful of land than unplanned sprawl.
Yet they often invade wheat fields and wood lots far from the job
centers, transit lines and cultural institutions that comprise real
communities -- while large quantities of usable sites that are well
served by infrastructure lie fallow in those real cities and towns.
These stumbling efforts recall an architectural parallel -- when people
first tried rather pathetically to restore old neighborhoods with false
storefronts, tarpaper bricks and Permastone.
There is no doubt that the present real
property tax...contributes more
to depressing the standard of housing than all government housing
policies combined do to raise it. The current property tax may fairly
be called the upside-down tax. It taxes land values too lightly,
buildings much too heavily. It rewards bad land use, penalizes good
land use. Consider three identical homes and lots:
- Owner No. 1 adds a rec room, new
roof, great landscaping. The
assessor comes by and says, in effect: "As punishment for making a
showplace, and for generating jobs and profits for local businesses,
we're raising your assessment by the amount of your investments. Your
tax bill will go up, not just for a year, but for as long as you keep
the house in good condition."
- Owner No. 2 lets his house of
the same size run down -- loose
banisters, torn screens, broken gutters, junk-filled yard. The
tells him, in effect: "Because you created an eyesore for your
neighbors and an unsafe dwelling for your tenants, we're reducing your
assessment and your taxes. If your place is more dilapidated next year,
we'll reduce them even more."
- Owner No. 3 tears his building
down; the idle lot neither houses
nor employs anybody. The friendly assessor tells him, in effect:
completely wasting your property, and for making no use of the
infrastructure provided for this area, we'll give you the lowest
assessment and tax bill of the three."
These all-too-familiar examples
condemn not the assessor but our present tax system. And the same
perverse property tax incentives apply to commercial properties. Is it
any wonder cities are torn apart? The wretched tax on buildings is only
the half of it. The low land tax is the other half. A speculator sees
that the annual increase in his or her land value is greater than the
tax bill. This signals the owner to do nothing, to sit back and collect
the values generated by productive neighbors and the community.
feeds on itself. The more land held out of use, the tighter
the supply of available sites. This raises land prices further,
seducing more speculators into the land game, hastening the flight of
residents and businesses from central cities and even small towns. This
is far from the only cause of sprawl, but one of the most potent. It
cannot be stressed too much because it is one of the least recognized
If we continue on our present course, overtaxing production and
undertaxing land, the outlook is dismal. It is heading us toward the
very conditions seen in extreme forms in Latin America and other
Time for Good News
The good news is that we can reclaim our historic foundation.
A problem is that our present property tax imposes a single tax rate on
the total land-plus-building value. When a locality increases the good
land tax, it automatically raises the destructive building tax. Thus
the obvious first reform is to sever the unholy union of these
distinctly different parts of the property tax.
Pittsburgh pioneered an easy way to do this with a two-rate tax.
taxed buildings at only one-sixth the rate on site values. Aliquippa
taxes land at a rate 16 times higher than on buildings. Some 20
Pennsylvania cities and towns utilize this approach, gradually
reducing taxes on structures. Results have been uniformly
good -- bringing idle land and empty buildings back into use,
rejuvenating business districts, and holding home prices in check so
seniors on fixed incomes are not pushed out of their neighborhoods.
Architects and other preservationists can help revive urban livability
- Joining forces with those who are pushing for this two-rate tax
- Persuading local governments to pass resolutions urging their
state legislatures to enable them to tax land and buildings at separate
- Pushing state legislators to follow through on this action; and
- Finally, at every opportunity, bringing public attention to the
necessity of recapturing publicly created land values as a way to save
our cities. Those who make restoration of America's historic land
system a part of the historic resources agenda will be doing a great
service to the country. This is the challenge and the opportunity.
CENTER FOR PUBLIC DIALOGUE
10615 Brunswick Ave - Kensington MD 20895
301-933-0277 - email@example.com
Why not make more free to “the poor” the land they were born to inherit
as they inherit the air to breathe and daylight to see by and water to
I am aware of the academic economist’s reaction to any land question.
Nevertheless, Henry George clearly enough showed us the simple basis of
poverty in human society. And some organic solution of this land
problem is not only needed, it is imperative.
What hope for stimulating a great architecture while land holds the
im-provements instead of the improvements holding the land? For an
organic economic structure this is wrong end around, and all
architecture is only for the landlord.
— Frank Lloyd Wright, The
Disappearing City, 1932,
reprinted in “FLW
Collected Writings,” Vol. 3, p. 98,
Rizzoli International Publications,