Blog 2 Origins of the Fairhope Single Tax Corporation

This is the second installment of my blog about the Fairhope Single Tax Colony and how it operates today.  For perspective, some background might be helpful. 

What was the economic climate in the late 1800s that would cause a group of people to leave their homes in Iowa and take the long journey to the mostly unsettled area on the bluffs of Mobile Bay, to try to create a new social order -- a utopian society?

"The central problems of the age were the unfair distribution of wealth and power and the deepening poverty that accompanied the unprecedented material progress," said Paul Gaston in his book Man and Mission: E.B. Gaston and the Origins of the Fairhope Single Tax Colony.  As Henry George wrote, "This association of poverty with progress is the great enigma of our times."

The late 1800s saw the expansion of the Industrial Age where great wealth was created at the same time many hard-working people were living in terrible poverty.  It was the age of monopolies.  Paul Gaston wrote that everywhere there were "gruesome" tales of  "deepening poverty, wrenching class conflict, with violent confrontations between industrial workers and factory owners." He also wrote, "'Unadulterated capitalism,' according to another authority, seemed to many to be on the verge of destroying the social order."  

Also according to Paul Gaston, Richard T. Ely, believed that "our food, our clothing, our shelter, all our wealth, is covered with stains and clots of blood." 

E. B. Gaston had been working in real estate, but stopped, and according to Paul Gaston's book, E. B. Gaston denounced real estate development as "speculative building" and said "Capital is allowed to control opportunity and give the laborers only enough of their product to keep their souls and bodies together."

The Sherman Anti-trust Act had been passed in 1890, but was not enforced until Teddy Roosevelt became president in 1901. 

It was time that progressive thinkers were searching for a better way. E. B. Gaston and his friends were involved in lively debates and discussions about various ideas and economic systems.  Henry George was a major philosopher and economist of his day.  E. B. Gaston became interested in the writings of Henry George.  Henry George's book, Progress and Poverty is still used today to teach candidates for FSTC membership about the principle of single tax.

George's warning sounds like it could be something heard today:

"What has destroyed every previous civilization has been the tendency to the unequal distribution and power.  This same tendency, operating with increasing force, is observable in our civilization today, showing itself in every progressive community, and with greater intensity the more progressive the community. Wages and interest tend to constantly fall, rent to rise, the rich to become richer, the poor to become more helpless and hopeless, and the middle class to be swept away." 

E. B. Gaston wanted to give a new social order a chance. He was able to convince a small group of others who came with him to the shores of  Mobile Bay so they could create a better way of life, fairer to all, and demonstrate that such a society could exist and prosper.   

They would base their community on the concept of the Colony owning all the land and the rents being the "single tax" that would support all the needs of the community.  The FSTC Constitution defined that community in this way:  "There shall be no individual ownership of land within the jurisdiction of the corporation, but the corporation shall hold as trustee for its entire membership the title to all lands upon which its community shall be maintained."

Fairhope grew into a wonderful place. But how does the concept of 'single tax' work in a community today that is intertwined with and part of a community that has many, many taxes including state and federal income tax, property taxes, and sales taxes?  Are its leaders still idealists striving to be fair to all?  I'll be talking more about this in upcoming blogs. 

Blog 1 Exploring the Transformation of Utopia

I'm a Fairhope lessee.  I've been one for almost 30 years now.  I love this town.  I knew that it was started as a Utopian Society back in 1894 in Iowa by a group of idealists.  These idealists were upset at the economics of the times.  In the late 1800's  there were huge monopolies where tremendous wealth was created for a few, and that wealth was often used to oppress the common man who had to struggle to survive.  The wealthy could own most of the land and charge huge rents. 

Henry George was an economist and a philosopher of that era.  He wanted to think of a fairer way to tax and distribute wealth.  He felt that since God made the land, no one should own it, but it should all be held in trust for the benefit of all the citizens.  The rents would be the only tax necessary--hence--Single Tax.  The 'single tax' would be a land tax.  A property tax is on both the land and improvements, but Henry George did not believe in taxing the improvements, so he advocated a land tax. 

A small group of people from Iowa wanted try out his concepts (though George was adamant that it could only work if entire states or the entire country followed his principle--not just one small area.)  They toured different areas of the country to find the right spot to start their utopia, "free from all forms of monopoly."  They found this land in Alabama on the bluffs overlooking Mobile Bay, and thought they had a 'fair" chance of succeeding.  So Fairhope Single Tax Colony was begun. 

This blog is to explore how the Fairhope Single Tax Corporation has transformed over the years, and what it means in 2014.