Government

The Estate Tax, Not Land Expropriation, Is The 'Right' Way To Take Land From White People

South Africa's decision to take land from white farmers without compensation is a noble thought, but there's a better way to execute the plan.

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You can keep your baggie, but I’m gonna need the rest of it back.

The South African Parliament passed a measure to seize land from white farmers, without compensation. It’s called land expropriation, and it has been tried by a few African nations in an attempt to wipe out the theft and rape of their lands by white colonizers.

The concept horrifies some people who think that seizing property without just compensation is among the worst things a government can do. Thing is, I agree with those people: taking land is among the worst things that can be done to a people — and that’s why the legacy of colonialism MUST BE wiped out. The white farmers in South Africa are direct descendants of colonists and war profiteers who stole the land from indigenous people, then enacted a brutal and racist regime to keep the land in the hands of a minority population, and they justified their actions on the theory of white supremacy. It is simply not an intellectually defensible position that the descendants of the people who stole the land should be able to continue reaping the benefits of the theft, forever, because NOW white people have decided that stealing is bad.

So don’t get it twisted. If you are against land expropriation, you best come up with a better way to redistribute the ill-gotten gains of colonial oppression back to the oppressed majority. “This is just the way things are now” is NOT an answer. “I didn’t personally enslave or murder any Africans to get this land I got from my granddaddy” is NOT an answer.

But I think there is a better way. If there is one somewhat uniquely “western” legal concept that I think could be applied the world over with positive effects, it would be the estate tax. The estate tax redistributes wealth. The estate tax breaks the legacy of wealth inherited through global criminal enterprise. The estate tax takes from the few and gives to the many. The estate tax breaks oligarchies.

Like all things “western,” the estate tax probably didn’t start in the “west.” Egypt almost certainly had some use of it, and probably a lot of other ancient civilizations whose records we just don’t have. But it really became a “thing” in Rome under the Caesars. Augustus used it to curtail the power of the Senate, imposing a succession levy on all but close relatives. Before Rome devolved into a full military dictatorship, the power of the Caesars was mainly the power of the purse: the Emperor was the wealthiest individual, by far, and pretty much the only individual who could pass his full estate onto his airs.

The estate tax was used, at turns, by emperors and kings throughout the middle ages. It was a good way to fund wars and keep the nobility in line. It’s important to remember that the estate tax was initially used to maintain power, not divest it. And it’s this ancient understanding to the concept that Republicans use today when railing against the “death tax.” You’ll note that the link I just used for Augustus came from the Heritage Foundation. They want you to know that the estate tax was a tool of Caesar!

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They don’t want you to know that the purpose of the estate tax radically changed in the 18th and 19th centuries. The “inheritance tax” currently used in Britain can more or less be traced back to 1796. Inspired by the French Revolution, that tax was imposed self-consciously to interrupt inherited wealth and to reorient society around providing for the poor instead of protecting the rich.

An inheritance tax is really a sublime piece of redistributive policy. It leaves the living person alone, knowing full well that a living person will fight to the death to protect what he thinks he’s earned. The tax is on the heirs who have no philosophical or moral claim to “earning” jack s**t. BUT… if the heir is productive and can make money, they can pay the tax and keep the land and keep it all rolling. The thing we should want as a society is for land to be in the hands of those who will use it most productively. An unskilled dauphin is not the right answer. But a hardworking heir can absorb the hit of the estate tax, and if they can make the land more productive than before, they can eventually surpass their parents. What they can’t do is sit there and add nothing and still reap all of the rewards — or at least if they try to do that, their estates will be greatly diminished.

You only need to watch a couple of seasons of Downton Abbey to see how effective a heavy estate tax can be. The estate tax was deployed to crush the British nobility and it pretty much worked. Yes, there are still class distinctions that go back to where your ancestor was when William came conquering. But the accumulation of landed wealth in the hands of a few princes based on their historical titles has been greatly diffused over the past 200 years… and England never had to fight a war to take it from them. (Counterpoint: “I see what you did with the dates. I’m standing RIGHT HERE” — says Oliver Cromwell.)

The estate tax has been ported to most of Europe, and obviously America. I don’t want to get dragged too deeply into a discussion of its continued utility in the modern American context, but suffice it to say that I think the accumulation of generational wealth is still a problem we face today and the estate tax has a proven track record of addressing that specific problem.

South Africa does not have an estate tax!

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[CORRECTION: South Africa does have an estate tax, but not an “inheritance” tax. The distinction is when the tax is paid, and I was focused on the British system. Thanks to Rolling Alpha for pointing out the error.]

You can understand why. Because making it harder to accumulate generational wealth ALSO makes it harder for a new class of people to rise up to power. Despite what they’ll tell you in the movies, it’s actually extremely hard to go from “rags to riches” in one generation. Each generation doing a little better than the previous one is how you make it, and it’s hard to do that if you are constantly being set back to zero whenever the old man dies. Having spent centuries under the yoke of white oppression, it’s reasonable that South Africans are reluctant to institute a policy that would hamper their ability to build up the wealth the white people have been building for so long. The obvious way to get around this is to set the estate tax so it only impacts “wealthy” estates, as we try to do here in America… but just like America, there will be people who think (irrationally in most cases) that they will reach “wealthy estate” status in their lifetimes, at which point they will certainly want to pass that onto their children. The dream of passing on what you’ve earned to your children is as old as time.

And so we come to land expropriation. Why institute a policy that would slowly erode the landed wealth of white colonizers when you can just take it back? If somebody steals all your jewelry, and you catch them, you don’t say “What’s done is done. How about you give me my earnings back, when you die, and then maybe your children will give my children back my bracelets, when they die?”

Unfortunately, land expropriation also has a track record, and it’s not great. Enter Zimbabwe.

In 2000, Robert Mugabe instituted a full land expropriation plan, kicked white farmers off of their lands, and gave it back to “the people.” More or less, it’s been a disaster. Without going too deep, there have been two main problems:

  • Mugabe by and large gave the land to veterans of the independence wars. These veterans kept Mugabe in power. But these guys did not know how to, you know, farm. So, great, they have the land they richly deserve, but not the skills to know how to use it towards its most productive ends.
  • Even if the war veterans had been great farmers, breaking up large tracts of farmland into individually sized plots is simply at odds with how the global agricultural economy works today. Productive farming takes advantage of huge economies of scale that the individual plot owner is hard-pressed to avail himself of. Breaking up one industrialized “farm” into eight plots of land consigns all eight people to being less productive than the one uber land owner who had the thing initially.

Land expropriation would be the right thing to do, if it worked, which it doesn’t really.

South African officials are sensitive to the Zimbabwe comparison, but their operating theory is that land expropriation would have worked if Mugabe’s regime hadn’t been stupid about it. Here’s a quote from The South African:

We spoke to the EFF Secretary-General, Godrich Gardee, and asked him about the “second Zimbabwe” notion. He stressed the world of differences between what’s happening here, and what happened across the border:

“Zimbabwe’s policy wasn’t land reform, it was a land grab. What we are doing is constitutional. It requires decisions taken in Parliament. It is subject to laws, and the general application of our constitution.”

“Everything that happens here will be legal, and follow procedure. It simply cannot be compared to Zimbabwe.”

Folks, this is a bad argument that is more about insulting Zimbabwe than it is about addressing the core problems with land expropriation. “It’s subject to laws,” okay, great. Zimbabwe’s land expropriation was subject to “laws” too — the laws Zimbabwe passed to grab the land. When you control the government, any damn thing you want to do can be “subject to laws.” It’s a meaningless distinction.

Which isn’t to say that South Africa can’t impose land expropriation better than Mugabe did. We just have to acknowledge that land expropriation is an inherently dangerous economic policy. Is the African National Congress going to take the land from a few white people and only give it to a few black people who have proven they have the farming and, really, BUSINESS skills to use it effectively? Maybe. Replacing white elites with black elites is probably a pretty good idea for South Africa. But MOST LIKELY there will be a lot of pressure on the ANC to take these huge tracts of land and divide them up among a much more populous group of people who need and want land. And it’s in the break-up that economic disaster potentially awaits.

Look, South Africa has to try something. The current state of affairs is unacceptable. White farmers cannot be allowed to control all of the good farmland, in perpetuity, simply because their ancestors successfully stole the farmland.

But I prefer the subtlety of tax law to the aggression of land seizure. Not because it will be less troubling to white people, but because it’s more likely to benefit the people of South Africa. Don’t seize the land “without compensation,” make these devils COMPENSATE you for every generation they want to hold onto their plots. Invest that money in education and research. Hell, invest that money into universal basic income.

I want black South Africa to be a global superpower. Land seizures feel like the short game. It’s fighting the last war. We must beat back the legacy of white supremacy, but we don’t have to act like white people while we’re doing it.

Elie Mystal is the Executive Editor of Above the Law and the Legal Editor for More Perfect. He can be reached @ElieNYC on Twitter, or at elie@abovethelaw.com. He will resist.

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