Capitalist or socialist?
Neither, and in a sense both. He agreed with the free-market economists that what people make belongs to them. He agreed with the socialists that the poverty around them was unjust and not natural. He argued that the two only seemed to conflict because both overlooked land.
“What I have done in this book, if I have correctly solved the great problem I have sought to investigate, is, to unite the truth perceived by the school of Smith and Ricardo to the truth perceived by the schools of Proudhon and Lasalle; to show that laissez faire (in its full true meaning) opens the way to a realization of the noble dreams of socialism…”
Adam Smith and David Ricardo were the founders of free-market economics. Pierre-Joseph Proudhon and Ferdinand Lassalle were leading socialists of George's century.
What he shares with free-market thinkers
George builds his case on property, not against it. The things people make with their own effort are theirs: their wages, their buildings, their tools, their savings. Taxing them, he argues, punishes the very work and thrift a society should want more of.
He also defends interest, at a time when many reformers called it theft. The return on capital, he concludes, comes from real forces in nature and trade, not from any trick of social arrangement.
And he distrusts government management. When he reviews the remedies of his day, he rejects regulation as a first resort.
“Nature acknowledges no ownership or control in man save as the result of exertion.”
“It is not an arbitrary, but a natural thing; it is not the result of a particular social organization, but of laws of the universe which underlie society. It is, therefore, just.”
“whatever savors of regulation and restriction is in itself bad, and should not be resorted to if any other mode of accomplishing the same end presents itself.”
What he shares with socialists
George rejects the comfortable view that poverty is nature's doing. He spends two Books taking apart the theories that blamed it on too many workers or too little capital, and he concludes that it comes from how land is held. That makes it an injustice, and one that society can end.
He speaks warmly of the socialist ideal and believes it can be reached, though not by decree. And when he imagines society after his reform, he describes government in terms a socialist would recognize.
“The ideal of socialism is grand and noble; and it is, I am convinced, possible of realization; but such a state of society cannot be manufactured—it must grow.”
“Government would change its character, and would become the administration of a great co-operative society.”
“We must make land common property.”
Where he parts from each
From capitalism as it existed, George parts over land. Private ownership of land, he argues, lets owners collect a toll on everyone else's work, and that toll grows as society progresses. He gives owners no claim to compensation for it.
From socialism, he parts over means. He rejects state direction of industry, keeps private ownership of everything people produce, and leaves even land titles where they are. The state collects only the rent.
“The equal right of all men to the use of land is as clear as their equal right to breathe the air—it is a right proclaimed by the fact of their existence.”
“Socialism in anything approaching such a form, modern society cannot successfully attempt.”
“It is not necessary to confiscate land; it is only necessary to confiscate rent.”
The middle path
Put together, George's position is a free market in everything people make and common ownership of what nobody made. Wages and interest stay with those who earn them. Rent, the value that land gains because a community grows around it, goes back to the community. In practice that means one tax on land values and no taxes on work, buildings or trade.
People who follow George today call this Georgism or geoism. Free-market writers have claimed him, and so have socialists, and the argument over which label fits is still going. George's own summary was a borrowed slogan.
“All that is necessary to social regeneration is included in the motto of those Russian patriots sometimes called Nihilists—“Land and Liberty!””
This page is written for this site as a guide to where George stood. The quotations are his own words, each linked to the paragraph it comes from.