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Thomas Paine's Agrarian Justice

Thomas Paine, the influential 18th-century political thinker and author of works like Common Sense and The Rights of Man, outlined an innovative proposal for funding general welfare through an estate tax in his 1797 pamphlet Agrarian Justice. This idea was rooted in his belief in natural rights, equality, and the need to address poverty caused by unequal land distribution in agrarian societies. Below, I'll break down the key elements of his concept.

Core Philosophy Behind the Idea

Paine argued that the earth, in its natural state, belongs to all humanity as a common inheritance. However, civilization and private property systems have led to land being monopolized by a few, creating poverty and inequality for the many who are dispossessed. He viewed this as an injustice that society must compensate for, not through charity, but as a matter of right. Paine emphasized that wealth accumulation, especially through land, often stems from societal improvements (like cultivation and infrastructure) rather than individual effort alone. To rectify this, he proposed a system where the wealthy contribute back to society upon death, funding universal benefits.

The Proposed Funding Mechanism: An Estate Tax

Paine suggested creating a "National Fund" financed primarily by a tax on inheritances (what we might call an estate tax today). Specifically:

Tax Rate and Scope: A 10% tax on the value of all landed property and personal estates at the time of the owner's death. This would apply to both real estate (land) and movable property (like money or goods), but Paine focused heavily on land as the root of inequality.
How It Works: The tax would be levied on the heirs or beneficiaries, not during the owner's lifetime. Paine calculated that this rate would generate sufficient revenue without overly burdening estates, estimating based on contemporary English and French economic data.
Exemptions and Fairness: He proposed exemptions or reduced rates for smaller estates to avoid harming the middle class or poor. For instance, direct descendants (like children) might pay less than distant heirs, incentivizing family continuity while still capturing revenue from large, unearned inheritances.

Paine framed this not as a punitive measure but as a "ground rent" owed to society for the privilege of exclusive land use. He explicitly rejected progressive income taxes or other levies on the living, arguing that inheritances represent unearned windfalls that should partially revert to the community.

How the Funds Would Support General Welfare

The revenue from this estate tax would fund a universal social welfare program, providing direct cash payments to all citizens regardless of wealth (a precursor to modern ideas like universal basic income or social security):

Payments to Young Adults: Every person, upon reaching age 21, would receive a one-time lump sum of £15 (equivalent to about several months' wages for a laborer at the time). This was intended as startup capital to help individuals establish themselves, buy tools, or start a trade, promoting economic independence.
Pensions for the Elderly: Starting at age 50, every citizen would receive an annual pension of £10 for life. This would address old-age poverty, disability, or infirmity, ensuring dignity without means-testing.
Universal Eligibility: Benefits would go to everyone—rich and poor alike—to avoid stigma and administrative complexity. Paine estimated this system could eradicate beggary and reduce poorhouses, benefiting society as a whole.

He projected that in a country like England or France (with populations around 7-15 million at the time), the fund could be self-sustaining, covering these payments while leaving room for surpluses.

Historical Context and Influence

Paine wrote Agrarian Justice during the French Revolution, inspired by debates on property rights and influenced by thinkers like Jean-Jacques Rousseau. He contrasted his plan with poor laws (which he saw as demeaning) and argued it aligned with republican ideals of liberty and equality. Though not implemented in his lifetime, the idea influenced later reforms, such as progressive taxation, inheritance taxes in the U.S. and Europe, and welfare states. For example, modern estate taxes (like the U.S. federal estate tax) echo Paine's rationale of curbing intergenerational wealth inequality to fund public goods.

Paine's proposal was radical for its era, blending Enlightenment philosophy with practical economics. He stressed that it wasn't socialism or redistribution of existing wealth but compensation for lost natural rights. If you're interested in the full text, Agrarian Justice is short and widely available online—it's a fascinating read on early social policy ideas.