The Danes, by old tradition, have been accustomed to the concept that the land belongs to the people. The rapid industrialisation and land enclosures of the 18th and 19th centuries, begun in England, saw this tradition come under sustained attack; attacks which grew more intense as industrialisation grew.

Farmers were pressed in the later half of the 19th century; many of them found support in the ideas contained in a newly released book "Progress and Poverty", by Henry George. As the economic situation became even tougher for small farmers, a so called "Georgist" movement began and the Danish Henry George Union was founded in 1902. Some of its more active members wanted a better platform for their political ambitions, and these members cooperated with other philosophic groups and public leaders in forming the Radical Left Wing Party, declaring that land value taxation (site revenue) should collect all the publicly created rent of land for government expenses, instead of levying taxes on income.

Around this time of course, Karl Marx was advocating that the workers unite to fight the desperate conditions of the working man. The Danish Social Democrats were inspired from this position. It too advocated in its political program the taxation of land value (site revenue).

Over the next fifty years, (not only in Denmark but around the world), there was long and intense debate about liberty and freedom; amongst free traders, pacifists, humanists, philosophers and religious institutions alike. Many of these people went to each other's meetings and contributed articles to each other's publications. Finally, they knew each other so well, that many of them decided to establish a union with the object of appealing to voters for seats in Parliament. The Justice Party was formed. Their economic policy was simple; to collect the economic rent of land and abolish all taxes on labour and capital. For a new political party, their effect was astonishing. Progress was quick and in 1952, they won 12 seats of a possible 179. They effected the appointment of a Government commission for ground rent in Denmark, who wrote its report clearly advocating the benefits of site revenue. In 1957 the Justice Party, together with the Social Democrats (Labour) and the Radical Left Wing Party (Liberals actually) formed what was to become the most prosperous ever Danish Government - later termed the Ground Rent Government.

Three political parties made an agreement based upon the following:

It was therefore generally expected that after formation of the government, some kind of land value taxation would be introduced. Land speculation ceased immediately. Legislation on taxation of increased land value was prepared, presented to parliament and passed.

The economic effects of the cessation of land speculation were astounding and aroused much attention. On the 2nd October, 1960, the New York Times headlined, "Big Lesson from a Small Nation."

Prior to the election of 1957, Denmark had a sizable deficit on her balance of payments, was considerably in debt abroad, and burdened with a relatively high interest rate, big unemployment figures and an annual rate of inflation of approximately 5%.

From 1957 to 1960, the following improvements took place:

After three years in power, Denmark had no foreign debt, no inflation and an unemployment level of 1%, considered full employment. So why is this not continuing?

  1. Until 1960, the Social Democrats were advocating the collection of site revenue for the purposes of government social responsibilities, the Radicals and Justice Party advocated site revenue for the purposes of income tax reduction. Minor conflict developed.

  2. Prior to 1960, "Georgist" beliefs dictated that when a heavy "tax" is levied upon land value, land price will decrease. The consequences of full employment, no inflation, no foreign debt, increasing production and rising real wages however, brought about a prodigious demand for homes, enterprises and of course land. Land prices did not initially fall, as was predicted. In fact land prices rose. The Justice Party was unprepared for this.

  3. In the late fifties, the Danish foreign debt was seen to be at crisis level. To assist with this, the Ground Rent Government did levy one new income tax. In addition to this of course, rising real incomes were eroded in part with the progressive nature of income tax on higher incomes. The self interested wealthy land owners had a field day confusing the fact that overall, taxes did go down by 10%. The general public found little reason to doubt the anti-Georgist literature stating that site revenue was simply another tax on top of all the other taxes. The land owners had no problem in fanning the now growing belief that the "socialists", (read communists, given the era), wanted to get hold of your property.

At the general election of 1960, the opposition used, for the time, the largest sum ever in any Danish election campaign, financed by the Conservatives and Landowner associations. Such is the power of self interested groups. With its limited financial resources and lacking support from the daily press, the Justice Party was unable to withstand the attacks. Agitation against the site revenue legislation continued after the election and the new, weakened government gave in. Further strong pressure from land-owner associations had the site revenue laws repealed in 1964.

After 1964:

A comparison between the three periods, before, during and after the so-called "Ground Rent Government," gives a clear picture of the importance of eliminating land speculation.


  1. A more detailed discussion of these facts can be found in the book "Triumph or Fiasco" (1969), written by Viggo Starcke, for many years leader of the Justice Party.

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