Towards A Real Free-Market Economy

Chris Waller - April 2013
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In 1872, during the premiership of William Gladstone, an attempt was made to document the ownership of land in Great Britain. The catalogue was to be known as The Return of Owners of Land. The whole project was fraught with difficulties, not least because the House of Lords then comprised almost entirely the land-owning class while the House of Commons was around 70 percent representative of landowning interests in one form or another. Only 5 percent of the adult population had the vote. This 'second Domesday Book', as it was called, was less than comprehensive in determining exactly who did own the land but it did reveal that the entirety of England, Scotland and Wales was owned by 4.5 percent of the population. The Return of Owners of Land was published in four volumes, of about 2,000 pages in total, over the next three years but after that Return mysteriously disappeared, some even claiming it did not exist.

Even now, in this 21st century, with all the marvels of digital technology and the scrutiny of the state - which seems otherwise to be able to poke its nose into almost everything - the ownership of over a third of the land in Britain still cannot be ascertained.

Here are a few facts to begin with:-

- The United Kingdom has 60 million acres of land in total
- 70% of the land is owned by 1% of the population
- Just 6,000 or so landowners - mostly aristocrats, but also large institutions and the Crown - own about 40 million acres, two thirds of the total acreage.
- Britain's top 20 landowning families have bought or inherited an area greater than the counties of Kent, Essex and Bedfordshire combined.
- Big landowners measure their holdings by the square mile; the average Briton living in a privately owned property has to exist on 340 square yards.
- Each home pays about 1,400 per annum on average in council tax while each landowning home receives around 23,000 per annum in subsidies.
- A building plot, the land, now constitutes between half to two- thirds of the cost of a new house.
- 60 million people live in 24 million 'dwellings'.
- These 24 million dwellings sit on approx 4.4 million acres (7.7% of the land).
- Of the 24 million dwellings, 11% owned by private landlords and 65% privately owned.
- 19 million privately owned homes, including their gardens, sit on 5.8% of the land.
- Agriculture only accounts for 1% of GDP. (Economist, Pocket World in Figures, 2012)
- Dwellings were built (2008) at an average density of 46 per hectare. Tower Hamlets LBC is the council with the densest new developments at an average of 254 dwellings per hectare (ca. 100 per acre). Test Valley Borough Council in Hampshire and Richmond District Council in North Yorkshire have the two lowest average densities at 16 dwellings per hectare (ca. 6.5 per acre).
- The average value of an acre of development land in Britain is 404,000. High in south east of 704,154, low in north east of 226,624. London is in a category of its own.
- Reservations of land have been placed by builders to a value of 37 billion to build the 3-4 million homes required. The land reserved is almost wholly owned by aristocrats; with none of it on the land registry. This land is coming out of subsidised rural estates, land held by off-shore trusts and companies and effectively untaxed.
- Tony Blair ejected from the House of Lords 66 hereditary peers, who between them owned the equivalent of 4.5 average sized English counties. Blair might have re removed them from the House of Lords, but the Lords still own their acres. Here is a list of the top ten aristocratic land-owners:-
- Duke of Buccleuch: 240,000 acres , value: 800m-1bn
- Trustees of the Dukedom of Athol: 145,700 acres , value: 364m
- Prince Charles, as Duke of Cornwall: 133,602 acres, value: 1bn-1.2bn
- Gerald Grosvenor, Duke of Westminster: 133,100 acres, value 6 billion
- Ralph Percy, Duke of Northumberland: 130,000 acres, value: 800m-1bn
- Captain Alwyne Farquharson: 128,000 acres, value: 320m
- Earl of Seafield: 101,000 acres, value: 253m
- Countess of Sutherland: 82,239 acres, value: 206m
- Baroness Willoughby de Eresby: 78,200 acres, value: 120m
- Viscount Cowdray, and the Pearson family: 69,500 acres, value: 285m

Even today, the question of land-ownership is shrouded in mystery but a study (Who Does Own Britain Today? - Land Ownership in the 1970s: Labour Research, Vol.68, Number 4) carried r 4) carried out in 1979 revealed the following:-
- 10 million acres (19 %) was in public ownership. Central Government Departments held 4.74 million acres (9%): 664,000 acres held by the Ministry of Defense, 3 million acres by the Forestry Commission. Nationalised industries and public services held 1.05 million acres (2%), this including the National Coal Board (258,000 acres) and British Rail (175,000 acres). Local Authorities held 4.2 million acres (8%).
- The 'Establishment' owned about 1 million acres (2%), this being divided between the Church of England (170,000 acres, 0.3%), the Crown (538,000 acres, 1%) and the universities (ca. 400,000 acres, 0.7%).
- 18 million acres (32%) were owned by the aristocracy
- 47% of the land in Britain comprises owner occupied farms and homes.

All of this gives a lie to the claim that Britain is overcrowded and that land is scarce. Housing is expensive in Britain because land is artificially kept off the market.

Governments since 1979, beginning with the Thatcher government, but later including those of the 'New Labour' project, claimed to espouse the free market. Why, then, did not land come under the discipline of the free market? Why did it continue to be subsidised, even when Margaret Thatcher railed against the Common Agricultural Policy, one of the chief sources of these subsidies?

As Kevin Cahill pointed out (New Statesman, 11th March 2011), "... the owners of Britain's agricultural plot are now the beneficiaries of an annual subsidy that may run as high as 23,000 each, totalling between 3.5bn and 5bn a year. Urban dwellers, on the other hand, pay about 35bn in land-related taxes. Rural landowners receive a handout of roughly 83 per acre, while urban dwellers pay about 18,000 for each acre they hold ...". It would be comforting to think that these subsidies go to farmers, that is, the people who drive tractors and produce food, but in reality it goes to the owner of the land which in the case of Britain most commonly means an aristocratic estate. The Telegraph, a newspaper not noted for being leftist, reports that: "The Duke of Westminster, Britain's third richest person with a fortune estimated at 6.5 billion, benefited from a public EU subsidy of 486,534. His Polish dairy businesses, Top Farms, benefited by more than 8 million euros in subsidies from 2006 to 2007." (Telegraph, 18th July 2009) Cahill further cites figures for Scotland, taken from Andy Wightman's book 'The Poor Had No Lawyers: Who Owns Scotland (And How They Got It). Wightman, quoting figures from the Scottish government, notes that: "During the ten years from 2000 to 2009, the top 50 recipients of agricultural subsidy received 168m - an average of over 3.3m per farmer. Among the top 50 are some of Scotland's wealthiest landowners, including the Earl of Moray, Leon Litchfield, the Earl of Seafield, Lord Inchcape, the Earl of Southesk, the Duke of Buccleuch, the Earl of Rosebery and the Duke of Roxburghe." Andrew George MP, in Fen February 2009, questioned the ownership of land in Great Britain and in a written response from Bridget Prentice, a then parliamentary undersecretary at the Ministry of Justice, was told that, "The Crown is the ultimate owner of all land in England and Wales (including the Isles of Scilly): all other owners hold an estate in land. Although there is some land that the Crown has never granted away, most land is held of the Crown as freehold or leasehold."

Thus, you may think you own your property but in reality, you are still merely a tenant of Her Majesty. Now, one can claim that this is just a convenient legal fiction since ultimately one can never actually own the property in land - to coin an old adage "You can't take it with you" - and one can argue that it is the State, in our case known as 'The Crown', which is the ultimate guarantor of property rights, but it does seem more than a little anachronistic that in this 21st century we are still subject to laws of land ownership imposed just after the Norman conquest.

William, Duke of Normandy, was a wanted criminal in his own country, charged with murder, rape, treason, arson and pillage. William justified his invasion of these islands by claiming that he had been promised the throne by King Harold II but one is more inclined to think that his main interest was in putting himself beyond the reach of French law while also filling his pockets, and those of the gang of thugs who accompanied him. Having invaded, he then claimed all the land for himself and distributed it among his accomplices.

It is interesting to note that the heirs and assigns of the Plantagenets still own 90 percent of the land they held 850 years ago, having increased their land-holdings during the 18th and 19th centuries by a further 8 million acres through the Enclosures. Thus even today the distribution of land and its benefits stands on the foundations laid by thugs and thieves some 940-odd years ago.

The Duke of Buccleuch, speaking on the subject of land reform in Scotland, was reported in the Daily Telegraph in 2003, as saying that, "... Scottish 'land reform' is just shameless legalised theft". (Telegraph, 20th March 2003). One might reasonably ask how the duke came by his property. A little research will reveal that the title of Duke of Buccleuch was created in 1663 for James Crofts, eldest illegitimate son of Charles II of England.

One feels bound to counter the duke's protestations with a pertinent comment from Kevin Carson: "The actual system of political economy that so many corporate apologists refer to as "our free market system" has in fact been characterized from the beginning by robbery. We must beware of "free market reforms" carried out by the robbers. They amount in practice to allowing the robbers - hands still full of loot - to say: "All right, no more stealing, starting ... now!"

If we are to have free markets then let us have them by all means, but let us begin with that most fundamental of resources, land. It is time to implement Land Value Taxation (LVT). There is already some interest in LVT, notably expressed by Andy Burnham MP, but it is far from main-stream and at the present time, enthusiasm is marginal and lukewarm. There has been some talk of a 'mansion tax' but that does not address the real problem. My fear also, is that any such tax would be implemented piecemeal and incorrectly.

If LVT is to work then it must be the only tax levied, replacing all current forms of taxation. Currently, practically all taxes, with the exception of Council Tax, are transaction-based. Transaction-based taxes are intrusive, bureaucratic and costly both to assess and collect. Furthermore, they are easily evaded - probably the reason for their continued popularity among a certain sector of the population. We have seen recently how Amazon, Vodafone, Google and Starbucks have managed to juggle their business transactions to avoid taxation in Britain.

Given the current inequitable distribution of land in Britain, as an adjunct to LVT, I would propose a 'National Dividend' whereby all qualifying residents would receive a payment amounting to a subsistence income from the total collected by LVT. This would, in part, be in lieu of all the current tax allowances, tax rebates and benefits currently allowed and paid. In this way everybody becomes a landlord: it would mean that, at current levels of population, each adult in Britain would receive an income from approximately 1.5 acres of land.

The British economy is moribund and even the Governor of the Bank of England can see no light at the end of the tunnel. One can offer many arguments to account for our current economic plight but by any reasonable measure we have been in economic decline now for 60 years. Indeed, there are strong arguments which show that we have been in economic decline since the last quarter of the 19th century. Volumes have been written on this subject but to my mind the most revealing analysis has come from Professor Mancur Olson.

Olson has said that: "In any given case of market combination or of special interest lobbying, then the problem is that a tiny minority, both in terms of voting power and wealth, rips off the rest of society in ways that reduce the efficiency and dynamism of the society."

Olson further explains the reasons for Britain's economic decline since the late 19th century: "Thus the problem of societies losing their efficiency and dynamism through collusion and organisations for collective action is mainly a problem of tiny minorities exploiting society at large."

It is clear then that if Britain is to have any prospect of economic resurgence, reform of the ownership of land and its taxation must form a fundamental part of any programme to cure the country of its economic sclerosis.

Sources and References

The Great Property Swindle, Kevin Cahill
"Who Owns Britain", 2001, Kevin Cahill, publ. Canongate.

Who Does Own Britain Today? - Land Ownership in the 1970s: Labour Research, Vol.68, Number 4), 1979

"The Subsidy of History", Kevin Carson, 2008.

Chris Waller - Permission granted to freely distribute this article for non-commercial purposes if attributed to Chris Waller, unedited and copied in full, including this notice.

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