Land Values and Women's Employment

The hours of paid work per family per year has risen significantly in recent decades as married women entered the workplace in large numbers. As Elizabeth Warren and Amelia Tyagi have noted in The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke (2003), a typical two-income couple today has less disposable income, after paying their fixed costs, than a single-income couple a generation ago!

Just as "population pressure is bound to increase the value of urban land," so is the additional income generated by the large-scale entry of women into the workplace.

But if we had had an adequate system of land taxation, we could have prevented the steep rise in urban land prices which robs families who need places to live and enriches those rich enough and foresighted enough to own well-located land. And had we had LVT in place, the families of those women would have reaped far more of the economic benefit of the hours of paid work they undertake.

What sort of economy do we want to leave for our children and grandchildren? One in which the landholders reap the benefits, or those who labor get the benefits? One in which affordable housing is available, or one in which young people must pay others a huge amount in order to have a place to live? One in which one pays the landlord or seller and then also pays taxes, or one in which the locational portion of what one pays to the landlord is passed along to the commons as the basis for our common spending? One in which people must borrow to the hilt to afford a home within commuting distance of well-paid work, or one in which a single salary is enough to support a family while children are young so that couples have a real choice about whether both partners work full-time?

Every form of enterprise only undertaken after the land monopolist has skimmed the cream off for himself It does not matter where you look or what examples you select, you will see that every form of enterprise, every step in material progress, is only undertaken after the land monopolist has skimmed the cream off for himself, and everywhere today the man or the public body who wishes to put land to its highest use is forced to pay a preliminary fine in land values to the man who is putting it to an inferior use, and in some cases to no use at all. All comes back to the land value, and its owner for the time being is able to levy his toll upon all other forms of wealth and upon every form of industry. A portion, in some cases the whole, of every benefit which is laboriously acquired by the community is represented in the land value, and finds its way automatically into the landlord's pocket. If there is a rise in wages, rents are able to move forward, because the workers can afford to pay a little more. If the opening of a new railway or a new tramway or the institution of an improved service of workmen's trains or a lowering of fares or a new invention or any other public convenience affords a benefit to the workers in any particular district, it becomes easier for them to live, and therefore the landlord and the ground landlord, one on top of the other, are able to charge them more for the privilege of living there. ...

Now let the Manchester Ship Canal tell its tale about the land. It has a story to tell which is just as simple and just as pregnant as its story about Free Trade. When it was resolved to build the Canal, the first thing that had to be done was to buy the land. Before the resolution to build the Canal was taken, the land on which the Canal flows -- or perhaps I should say 'stands' -- was, in the main, agricultural land, paying rates on an assessment from 30s. to L2 an acre. I am told that 4,495 acres of land purchased fell within that description out of something under 5,000 purchased altogether. Immediately after the decision, the 4,495 acres were sold for L777,000 sterling -- or an average of L172 an acre -- that is to say, five or six times the agricultural value of the land and the value on which it had been rated for public purposes.

Now what had the landowner done for the community; what enterprise had he shown; what service had he rendered; what capital had he risked in order that he should gain this enormous multiplication of the value of his property! I will tell you in one word what he had done. Can you guess it! Nothing.

But it was not only the owners of the land that was needed for making the Canal, who were automatically enriched. All the surrounding land either having a frontage on the Canal or access to it rose and rose rapidly, and splendidly, in value. By the stroke of a fairy wand, without toil, without risk, without even a half-hour's thought many landowners in Salford, Eccles, Stretford, Irlam, Warrington Runcorn, etc., found themselves in possession of property which had trebled, quadrupled, quintupled in value.

Apart from the high prices which were paid, there was a heavy bill for compensation, severance, disturbance, and injurious affection where no land was taken -- injurious affection, namely, raising the land not taken many times in value -- all this was added to the dead-weight cost of construction. All this was a burden on those whose labour skill, and capital created this great public work. Much of this land today is still rated at ordinary agricultural value, and in order to make sure that no injustice is done, in order to make quite certain that these landowners are not injured by our system of government, half their rates are, under the Agricultural Rates Act, paid back to them. The balance is made up by you. The land is still rising in value, and with every day's work that every man in this neighbourhood does and with every addition to the prosperity of Manchester and improvement of this great city, the land is further enhanced in value. ... Read the whole piece

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