Thomas Paine called for a BI in 1797 financed by Land Value Taxation
If you know something about Basic Income, you may be aware that one of the first proposals for a Basic Income came from Thomas Paine, hero of the American and French revolutions. In 1797, after a stint in a French prison, Paine wrote the pamphlet Agrarian Justice, which sets out an argument for taxing land and distributing the proceeds among the population at large as compensation for landlessness.
Agrarian Justice has a reputation as a “neglected” pamphlet of Paine’s, both because it made so little impact when first published, and because later students of Paine haven’t given it sufficient attention. A paper of mine that was recently published in the Journal for the Study of Radicalism investigates the history of Paine’s essay and its continuing relevance (the published paper is here and an author proof copy is here).
Paine’s proposal to tax land and distribute the proceeds widely rests on a basic insight from the natural law tradition: namely, the insight that there are two kinds of property, things that are created by human effort, and things that are not. Things that are not created by human effort — like land and other natural resources — are a common inheritance, and everyone has an equal right to enjoy them.
When a few monopolize the land, the normal remedy is redistribution. Writing in part for a French audience that had just experienced a bloody revolution, and in part for a English audience that feared revolution, Paine proposed a remedy that was much less disruptive. Let the landowners keep their land, he said. Let them simply pay a tax, and let that money be used to compensate the landless and give them some financial security. Paine proposed that money from the fund be distributed to the elderly and the disabled, plus a disbursement to every young man and woman on turning age 21 to help them start out in life.
Paine’s pamphlet had very little impact when it was published in 1797. It has usually been assumed that Paine had simply lost his reading public. After all, by 1797 his closest French colleagues had been scattered or killed in the Jacobin reign of terror. In Britain, his fellow radicals were being suppressed by the government. Many American readers had turned against him, scandalized by the supposed French atheism of his previous book, Age of Reason.
But this isn’t the whole story. In fact, the pamphlet was not only published in London and Paris, as well known, but in at least 10 cities and three languages (English, French, and German). It was serialized in newspapers and reviewed in widely read journals. English radicals staged a public debate about the merits of Paine’s plan in London, and many of them were enthusiastic about it.
No, Paine had not lost his reading public. The pamphlet’s “neglect” — its failure to make a difference — had other causes. The new paper attempts to tease these out.
Paine’s proposal did not fit neatly into existing radical discourses. It did not suit the temperament of revolutionary collectivists like Paine’s contemporaries Thomas Spence and “Gracchus” Babeuf, and later Karl Marx and Friedrich Engels, who wanted villains to overthrow. Nor did it suit the so-called “utopian socialists” like Robert Owens and Charles Fourier and Henri de Saint-Simon, who wanted to build a more just society immediately at the local level, not lobby for changes that might happen someday at the national level. Paine’s proposal was a curious mixture of conservative property rights and radical social reforms.
In the United States, there were two further factors that prevented even admirers of Paine’s plan from endorsing it. One factor has now been overcome, and the other remains with us today and hampers Basic Income advocacy.
The first factor was that — if one ignored the rights of Native Americans, as most did — the United States was “empty” territory. Before questions could be asked about what compensation landowners owed the landless, the more pressing question was who would settle the land in the first place. Admirers of Paine like the New York printer George H. Evans successfully lobbied for state and federal “homestead acts” that encouraged settlement by smallholders and fostered broad-based landownership.
The second factor was that America was — and still is — a heterogenous society with relatively open borders. To argue that British and French landed nobility owe some compensation to their landless tenants is one thing. To advocate for payment of universal dividends in the U.S. context is quite another. There will always be “out” groups — e.g., recently arrived immigrants, whether Irish domestics and Chinese railroad laborers, or Somali refugees and Mexican farmhands (to say nothing of racism toward African-Africans) — that some Americans will view as undeserving of a generous social safety net. Today many European nations too have significant immigrant populations and face a similar dynamic.
In the 1970s, the State of Alaska decided that one of the things it would do with its newfound oil wealth was to issue annual dividends to residents. Some in Alaska feared that the state’s generosity might attract freeloaders. But those fears were misplaced. There was no massive influx of settlers from the lower 49 looking for “free stuff.” Today Alaskans are justifiably proud of the Alaska Permanent Fund Dividend, which is founded on a principle similar to Paine’s: regardless of who is given permission to drill and sell it, Alaska’s oil belongs to all Alaskans. Partly as a result of the dividend, provided to old and new residents alike, Alaska enjoys some of the lowest rates of wealth inequality in the nation.
With the Covid-19 crisis, calls for a Basic Income are gaining new momentum. The U.S., and other countries too, could enjoy the immense society-wide benefit of a Basic Income if they are willing to set aside the sour grapes argument — which has been in play since Paine’s own time—of not providing a social safety net to out-groups.
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