Spencer Heath Archive

Item 2294..

Typed letter to Heath from Raymond V. McNally, 200 East 16^th Street, New York 3, New York (Heath’s reply is Item 1428)

February 24, 1945

 

 

 

 

Dear Mr. Heath:

    I have read over again your manuscript called “Progress and Poverty Reviewed—Its Basic Fallacies Exposed.” It is a masterly treatise, but there are two or three points upon which I would like to comment that you might wish to revise.

    On page 2 you state “This and much more to the same effect, just as he later hotly opposed the outright nationalization of land, yet he urged with fanatical zeal a taxing policy that could have no other effect.” But on page 20 you state “Henry George proposed, at page 406: ‘To abolish all taxation save that on land values.’ His exception was well taken — better than he knew; for it is not necessary to abolish the taxation that falls on land values. Such taxation will be automatically transformed from costly coercion to profitable voluntarism.” This seems to me to be a serious contra­diction on your part. How can George’s remedy be both harmful and beneficial? In one breath you condemn him and in the next you praise him. If you recall, you and I discussed the phrase “save that on land values.” You defended it against my criticism. This was quite some time ago, possibly two or three years.

    Now to insist, as you do on page 2, that “it is not necessary to abolish the taxation that falls on land values” and then again to condemn George on page 21 with the statement, “But if the taxation of land values should be indefinitely increased, as Henry George urged, then, whatever the intent, contractual rent would be degraded progressively into compulsory taxation,” seems to me to indicate confusion on the critic’s part.

    On page 22 you assert that George had no perception of the social function performed by the modern institution of property in land, but this does not seem to me to be entirely true. In the Fiftieth Anniversary edition on page 405, he writes, “Nor to take rent for public uses is it necessary that the State should bother with the letting of lands, and assume the chances of the favoritism, collusion, and corruption this might involve. It is not necessary that any new machinery should be created. The machinery already exists(emphasis mine).” This indicates that George realized, to some extent at least, that it was not the proper function of the state to administer the land and that he perceived, if only dimly, that it was the landowner’s function to do so. His error lay in this statement: “Instead of extending it, all we have to do is to simplify and reduce it.”

    On page 19 you  accuse George of acknowledging the identity of principle between Malthus whom he rejects and Ricardo whom he accepts, but here, I think, some qualification is necessary. It is true, as you say, that on page 168 he unquestioningly adopts Ricardo’s Law, but on page 231(not 321 as your manuscript reads), he qualifies his acceptance of it by pointing out the “misapprehension” that has caused Ricardo to be identified with Malthus. I remember that I had always been somewhat disturbed by George’s unqualified acceptance of Ricardo’s Law in the early part of Progress and Poverty in the face of this “misapprehension” which he points out later on. As a faithful follower I remember I had always thought that he gave Ri­cardo too much credit. At the same time, it is not fair to censure him too much. It seems to me that what George was accepting was not Ricardo’s own conception of the Law but the conception that had been finally formulated by economists since Ricardo stated it. What George accepted was not Ricardo’s pessimistic idea that rent was due to the niggardliness of nature but the idea that rent was a differen­tial. Even Malthus did not believe that rent was due to the failure of the soil. He held that rent was a surplus due to the bounty of nature as Adam Smith and the Physiocrats believed. Now while it is true that Ricardo when he lived was identified with Malthus, it is not true that the newer idea of rent was linked with Malthus’ doc­trine of population. It is obvious that George held the newer idea of rent, and when you accuse him of acknowledging the identity of principle between Malthus and Ricardo, you leave yourself open to the possible criticism (particularly on the part of some staunch follower of George’s)that you are straining too much to discredit George.

    On page 19 you are in error when you state that “It is also true, as so stoutly maintained, that the rent of land is the differe­nce between the annual value of land where rent is paid and the value of so-called marginal land where no rent is paid.” According to George (and Ricardo), the rent of land is the difference between the produce of it and the produce of land where no rent is paid.

    Aside from the foregoing, I do not notice anything else that you might correct except a number of typographical or grammatical errors.

    One of these days I shall call and return the manuscript which I have enjoyed so much reading.