Thomas Paine Solves the Perennial Problem of Land Reform

Inequitable distribution of land has been a perennial problem for human societies. Corrections have often been difficult and involved bloodshed, and they have rarely provided lasting relief. Thomas Paine struck upon a permanent, fair solution in the 1790s, drawing on the natural law tradition associated with Grotius and Locke. He proposed that landholders compensate the landless by paying into a trust fund. In Paine’s vision, the trust fund would issue universal dividends in the form of seed capital for young adults and pensions for the elderly and disabled. Paine’s 1797 pamphlet Agrarian Justice had little contemporary impact, but others worked out variants of the idea, most notably the American reformer Henry George. George left a lasting legacy in scholarship and policy. Although George is on record as approving a limited issuance of dividends, he is primarily known for proposing that land tax revenue be used to fund government. A useful distinction can be made between a “Paineite” approach of taxing land to fund dividends and a “Georgeist” approach of taxing land to fund government.