8. (2014 July-August) Movement Progress: Clifford Cobb

A lesson for Georgists from the politics of land reform
Georgists seldom discuss the political constituencies that might support the public collection of economic rent.  Yet identifying supportive constituencies is a necessary part of political success.
There are no political issues that are comparable in scope with the comprehensive character of Georgist reform.   Nevertheless, traditional land reform shares the scope and scale of Georgist reform to some extent. The transfer of land from large estates into smaller holdings is intended to transform agrarian society comprehensively.Leaving aside the question of whether land reform will achieve its own objectives, we can learn from the politics of land reform why success is so elusive.  There are insights here that some Georgists might find valuable.  Why, for example, have autocratic regimes been more successful in achieving land reform than democracies?  That is one of the three “puzzles” of land reform discussed by Alain de Janvry and Elisabeth Sadoulet in “The three puzzles of land reform.” 

Logically, they suggest, one would expect democracies, with a majority of landless and small-holding peasants, to vote for land redistribution.  But, in fact, that has seldom happened because democratic constitutions are invariably set up with checks and balances that prevent redistributive coalitions from developing any stability.

The second puzzle they identify is “Why do land reforms grant incomplete property rights?”  It has been understood for centuries that limited land titles, which restrict rights of use and transfer, will reduce the productivity of the soil. To understand why land reforms that break up large estates and distribute land to peasants founder on the shoals of only partial titling, the authors turn to a political explanation: partial titling makes the recipients dependent on particular political parties for ongoing credit and marketing services provided by the state.

This second explanation also largely answers their third question: “Why are complete land reforms politically risky?”  Regimes that keep the carrot of full ownership in front of peasants can stay in power forever.  Well almost.  Suppose a new party comes along and promises the peasants to grant them full title to their land, as PAN did in Mexico in the 1990s?  (PAN is a mostly Catholic, free market oriented political party, which overturned the century-long control of the PRI in Mexico.  The PRI originally redistributed land through the ejido system, a system of incomplete property rights and low productivity.)  To win the presidency of Mexico in 1999, PAN got millions of votes by promising land title reform.  But after a decade, the reforms were largely completed.  Now the peasants no longer need PAN to sustain them economically.  The fortunes of PAN have begun to wane, and the PRI, which fully understands the politics of patronage, is making a come-back.  Thus, as the authors of the article conclude, one-time rights transfers may not correspond with continuing political loyalty.

What does this mean for the politics of public rent collection?  The reforms sought by Georgists are similar in one way to the titling reforms achieved by PAN.  In both cases, the reform has a very limited political shelf-life.  PAN at least had the advantage of offering an immediate, one-time benefit to a defined constituency.  That enabled them to gain the presidency and a legislative majority, even though it was tenuous.  

Georgism lacks the capacity to offer any sort of targeted benefits.  Instead, we offer long-term benefits to a diffuse constituency.  We propose to benefit everyone, but at the same time, we cannot promise any individual or group a special and immediate benefit, which is the currency of politics.  So, we are left at the starting gate.  (The two-rate tax does benefit owners of fully-developed property and pinches the owner of underused land, but even that modest reform still has not developed an identifiable constituency after half a century.)  

If Georgists ever succeeded on a large scale–at the national or state level–would we be able to sustain the constituency that initially supported the change?  Or would we end up like PAN, deserted by our supporters the moment victory was in hand?

2 thoughts on “8. (2014 July-August) Movement Progress: Clifford Cobb

  1. The long term promise of the single tax is even less “attractive” than the PAN one shot reform. Because it creates an oasis of freedom from landlord profiteering. The whole history of migrations have them fleeing from where landlords are too powerful to where they are less, and so this oasis will become a lifeboat in the frigid waters of privilege. The region will see extreme growth and take on every cost of that growth, but all the positives will be continuously diluted. Rather then internalizing the benefits of improvements to the community, they will be externalized to the entire immigrating world. And the visible effect of all this will be relentlessly climbing land rents, which will having the same bite as a tax will be vilified as a tax. An out of control tax. Heros in white livery will be quick to ride in to rescue the people (and their own real estate holdings.)

    That is the history of Prop 13 in California. It wasn’t just the iconic poor widows forced away from their family abodes, it was everybody all the time.

    Without addressing the life boat effect, the reform creates the constituency of its own demise.

  2. This is an interesting article. Where was it originally published? The only info. given is U. of CA at Berkley and FERDI. What is FERDI? Thank you. co

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