The Limehouse Speech (1909)

Editorial note

Ten weeks after introducing the People's Budget in the House of Commons, Chancellor of the Exchequer David Lloyd George took the case to a mass Liberal audience at the Edinburgh Castle public house in Limehouse, one of the poorest districts of London's East End, on 30 July 1909. The speech - which the 1910 collected edition prints under the title The Land and the People - defended the Budget's new land value duties (the increment value duty, the undeveloped-land duty, the reversion duty, and the duty on mineral royalties) by casting land monopoly as an unearned toll levied on the whole community.

The heart of the speech is a sequence of concrete cases meant to show the duties at work. The "golden swamp" between the Lea and the Thames - marsh "rented at £2 or £3 an acre" that rose to "£2,000 an acre... £8,000 an acre" once the trade of the Port of London swelled around it - carries the increment argument: "Who created that increment?... It was purely the combined efforts of all the people engaged in the trade and commerce of the Port of London... everybody except the landlord." The Duke of Northumberland, asked to sell a plot for a school, "rated" at a nominal figure but demanding "£900 an acre," and the Gorringe case - in which the Duke of Westminster renewed a business tenant's lease only on terms raising a few hundred pounds' ground rent to "£4,000 a year" plus a "£50,000" fine - supply the reversion and leasehold arguments. Against the passive landlord Lloyd George sets those who take real risk: "The capitalist risks, at any rate, the whole of his money; the engineer puts his brains in; the miner risks his life."

The speech's most-quoted turn is its redefinition of landed property as conditional: "The ownership of land is not merely an enjoyment, it is a stewardship," and if owners "cease to discharge their functions... the time will come to reconsider the conditions under which land is held in this country." Its combative tone caused an immediate aftershock - it is widely said to have angered King Edward VII, and "to limehouse" briefly entered political slang for this style of populist attack - and it set the terms for the constitutional collision that followed when the House of Lords rejected the Budget four months later.

Public-domain status. A public political speech delivered in 1909 and printed in 1910. Lloyd George died in 1945, so the work is out of copyright in the United Kingdom (life + 70 years expired at the end of 2015) and in the United States (published before 1931). It is therefore clear in both jurisdictions and is reproduced here in full.

The Land and the People

Limehouse, 30 July 1909

A few months ago a meeting was held not far from this hall, in the heart of the City of London, demanding that the Government should launch into enormous expenditure on the Navy. That meeting ended up with a resolution promising that those who passed that resolution would give financial support to the Government in their undertaking. There have been two or three meetings held in the City of London since attended by the same class of people, but not ending up with a resolution promising to pay. On the contrary, we are spending the money, but they won't pay. What has happened since to alter their tone? Simply that we have sent in the bill. We started our four "Dreadnoughts." They cost eight millions of money. We promised them four more ; they cost another eight millions. Somebody has to pay, and then these gentlemen say, " Perfectly true ; somebody has to pay, but we would rather that somebody were somebody else." We started building; we wanted money to pay for the building; so we sent the hat round. We sent it round amongst workmen, and the miners and weavers of Derbyshire and Yorkshire,¹ and the Scotchmen of Dumfries, who, like all their countrymen, know the value of money, they all dropped in their coppers. We went round Belgravia, and there has been such a howl ever since that it has well-nigh deafened us.

But they say, " It is not so much the ' Dreadnoughts ' we object to, it is pensions." If they objected to pensions, why did they promise them? They won elections on the strength of their promises. It is true they never carried them out. Deception is always a pretty contemptible vice, but to deceive the poor is the meanest of all. They go on to say, "When we promised pensions we meant pensions at the expense of the people for whom they were provided. We simply meant to bring in a Bill to compel workmen to contribute to their own pensions." If that is what they meant, why did they not say so? The Budget, as your chairman has already so well reminded you, is introduced not merely for the purpose of raising barren taxes, but taxes that are fertile, taxes that will bring forth fruit — the security of the country which is paramount in the minds of all. The provision for the aged and deserving poor — was it not time something was done? It is rather a shame that a rich country like ours — probably the richest in the world, if not the richest the world has ever seen — should allow those who have toiled all their days to end in penury and possibly starvation. It is rather hard that an old workman should have to find his way to the gates of the tomb, bleeding and footsore, through the brambles and thorns of poverty. We cut a new path for him — an easier one, a pleasanter one, through fields of waving corn. We are raising money to pay for the new road — aye, and to widen it so that 200,000 paupers shall be able to join in the march. There are many in the country blessed by Providence with great wealth, and if there are amongst them men who grudge out of their riches a fair contribution towards the less fortunate of their fellow-countrymen they are very shabby rich men. We propose to do more by means of the Budget. We are raising money to provide against the evils and the sufferings that follow from unemployment. We are raising money for the purpose of assisting our great friendly societies to provide for the sick and the widows and

orphans. We are providing money to enable us to develop the resources of our own land. I do not believe any fair-minded man would challenge the justice and the fairness of the objects which we have in view in raising this money.

Some of our critics say, "The taxes themselves are unjust, unfair, unequal, oppressive — notably so the land taxes." They are engaged, not merely in the House of Commons, but outside the House of Commons, in assailing these taxes with a concentrated and a sustained ferocity which will not allow even a comma to escape with its life. Now, are these taxes really so wicked ? Let us examine them ; because it is perfectly clear that the one part of the Budget that attracts all this hostility and animosity is that part which deals with the taxation of land. Well, now let us examine it. I do not want you to consider merely abstract principles. I want to invite your attention to a number of concrete cases ; fair samples to show you how in these concrete illustrations our Budget proposals work. Let us take them. Let us take first of all the tax on undeveloped land and on increment.

Not far from here, not so many years ago, between the Lea and the Thames, you had hundreds of acres of land which was not very useful even for agricultural purposes. In the main it was a sodden marsh. The commerce and the trade of London increased under Free Trade, the tonnage of your shipping went up by hundreds of thousands of tons and by millions ; labour was attracted from all parts of the country to cope with all this trade and business which was done here. What happened? There was no housing accommodation. This Port of London became overcrowded, and the population overflowed. That was the opportunity of the owners of the marsh. All that land became valuable building land, and land which used to be rented at £2 or £3 an acre has been selling within the last few years at £2,000 an acre, £3,000 an acre, £6,000 an acre, £8,000 an acre. Who created that increment? Who made that golden swamp? Was it the

landlord? Was it his energy? Was it his brains — a very bad look-out for the place if it were — his forethought? It was purely the combined efforts of all the people engaged in the trade and commerce of the Port of London — trader, merchant, shipowner, dock labourer, workman — everybody except the landlord. Now, you follow that transaction. Land worth £2 or £3 an acre running up to thousands. During the time it was ripening the landlord was paying his rates and his taxes not on £2 or £3 an acre. It was agricultural land, and because it was agricultural land a munificent Tory Government voted a sum of two millions to pay half the rates of those poor distressed landlords, and you and I had to pay taxes in order to enable those landlords to pay half their rates on agricultural land, while it was going up every year by hundreds of pounds through your efforts and the efforts of your neighbours.

That is now coming to an end. On the walls of Mr. Balfour's meeting last Friday were the words, "We protest against fraud and folly." So do I. These things I tell you of have only been possible up to the present through the " fraud " of the few and the " folly " of the many. What is going to happen in the future? In future those landlords will have to contribute to the taxation of the country on the basis of the real value — only one halfpenny in the pound ! Only a halfpenny ! And that is what all the howling is about.

There is another little tax called the increment tax. For the future what will happen? We mean to value all the land in the kingdom. And here you can draw no distinction between agricultural land and other land, for the simple reason that East and West Ham was agricultural land a few years ago. And if land goes up in the future by hundreds and thousands an acre through the efforts of the community, the community will get 20 per cent, of that increment. Ah ! what a misfortune it is that there was not a Chancellor of the Exchequer to do this thirty

years ago ! We should now have been enjoying an abundant revenue from this source.

I have instanced West Ham. Let me give you a few more cases. Take cases like Golder's Green and others of a similar kind where the value of land has gone up in the course, perhaps, of a couple of years through a new tramway or a new railway being opened. Golder's Green to begin with. A few years ago there was a plot of land there which was sold at £160. Last year I went and opened a tube railway there. What was the result? This year that very piece of land has been sold for £2,100 — £160 before the railway was opened — before I went there — £2,100 now. My Budget demands 20 per cent, of that.

There are many cases where landlords take advantage of the needs of municipalities and even of national needs and of the monopoly which they have got in land in a particular neighbourhood in order to demand extortionate prices. Take the very well-known case of the Duke of Northumberland, when a county council wanted to buy a small plot of land as a site for a school to train the children who in due course would become the men labouring on his property. The rent was quite an insignificant thing; his contribution to the rates I think was on the basis of 30s. an acre. What did he demand for it for a school? £900 an acre. All we say is this — if it is worth £900, let him pay taxes on £900.

There are several of these cases that I want to give to you. Take the town of Bootle, a town created very much in the same way as these towns in the East of London, by the growth of a great port, in this case Liverpool. In 1879 the rates of Bootle were £9,000 a year — the ground rents were £10,000 — so that the landlord was receiving more from the industry of the community than all the rates derived by the municipality for the benefit of the town. In 1898 the rates had gone up to £94,000 a year — for improving the place, con-

structing roads, laying out parks, and extending lighting and opening up the place. But the ground landlord was receiving in ground rents £100,000. It is time that he should pay for all this value, and the Budget makes him pay.

Another case was given me from Richmond which is very interesting. The Town Council of Richmond recently built some workmen's cottages under a housing scheme. The land appeared on the rate-book as of the value of £4, and, being agricultural, the landlord only paid half the rates, and you and I paid the rest for him. It is situated on the extreme edge of the borough, therefore not very accessible, and the town council naturally thought they would get it cheap. But they did not know their landlord. They had to pay £2,000 an acre for it. The result is that instead of having a good housing scheme with plenty of gardens and open space, plenty of breathing space, plenty of room for the workmen at the end of their days, forty cottages had to be crowded on two acres. If the land had been valued at its true value, that landlord would have been at any rate contributing his fair share of the public revenue, and it is just conceivable that he might have been driven to sell at a more reasonable price.

I do not want to weary you with these cases. But I could give you many. I am a member of a Welsh county council, and landlords even in Wales are not more reasonable. The police committee the other day wanted a site for a police station. Well, you might have imagined that if a landlord sold land cheaply for anything it would have been for a police station. The housing of the working classes — that is a different matter. But a police station means security for property. Not at all. The total population of Carnarvonshire is not as much — I am not sure it is as great — as the population of Limehouse alone. It is a scattered area ; no great crowded populations there. And yet they demanded for a piece of land which was contri-

buting 2s. a year to the rates, £2,500 an acre ! All we say is, "If their land is as valuable as all that, let it have the same value in the assessment book as it seems to possess in the auction-room."

There was a case from Greenock the other day. The Admiralty wanted a torpedo range. Here was an opportunity for patriotism ! These are the men who want an efficient Navy to protect our shores, and the Admiralty state that one element in efficiency is straight shooting, and say : " We want a range for practice for torpedoes on the coast of Scotland." There was a piece of land there which had a rating value of £11 2s., and it was sold to the nation for £27,225.

And these are the gentlemen who accuse us of robbery and spoliation !

Now, all we say is this : " In future you must pay one halfpenny in the pound on the real value of your land. In addition to that, if the value goes up, not owing to your efforts — if you spend money on improving it we will give you credit for it — but if it goes up owing to the industry and the energy of the people living in that locality, one-fifth of that increment shall in future be taken as a toll by the State." They say : "Why should you tax this increment on landlords and not on other classes of the community?" They say: "You are taxing the landlord because the value of his property is going up through the growth of population, through the increased prosperity of the community. Does not the value of a doctor's business go up in the same way?"

Ah, fancy their comparing themselves for a moment ! What is the landlord's increment? Who is the landlord? The landlord is a gentleman — I have not a word to say about him in his personal capacity — the landlord is a gentleman who does not earn his wealth. He does not even take the trouble to receive his wealth. He has a host of agents and clerks to receive it for him. He does not even take the trouble to spend his wealth. He has a host

of people around him to do the actual spending for him. He never sees it until he comes to enjoy it. His sole function, his chief pride is stately consumption of wealth produced by others. What about the doctor's income? How does the doctor earn his income? The doctor is a man who visits our homes when they are darkened with the shadow of death ; who, by his skill, his trained courage, his genius, wrings hope out of the grip of despair, wins life out of the fangs of the Great Destroyer. All blessings upon him and his divine art of healing that mends bruised bodies and anxious hearts. To compare the reward which he gets for that labour with the wealth which pours into the pockets of the landlord purely owing to the possession of his monopoly is a piece — if they will forgive me for saying so — of insolence which no intelligent man would tolerate.

So much then for the halfpenny tax on unearned increment. Now I come to the reversion tax. What is the reversion tax? You have got a system in this country which is not tolerated in any other country in the world, except, I believe, Turkey — a system whereby landlords take advantage of the fact that they have got complete control over the land to let it for a term of years, spend money upon it in building, and year by year the value passes into the pockets of the landlord, and at the end of 60, 70, 80, or 90 years the whole of it passes away to the pockets of a man who never spent a penny upon it. In Scotland they have a system of 999 years lease. The Scotsmen have a very shrewd idea that at the end of 999 years there will probably be a better land system in existence, and they are prepared to take their chance of the millennium coming round by that time. But in this country we have 60 years leases. I know districts — quarry districts — in Wales where a little bit of barren rock on which you could not feed a goat, where the landlord could not get a shilling an acre for agricultural rent, is let to quarrymen for the purpose of building houses at a ground rent of 30s. or £2 a house.

The quarryman builds his house. He goes to a building society to borrow money. He pays out of his hard-earned weekly wage contributions to the building society for 10, 20, or 30 years. By the time he becomes an old man he has cleared off the mortgage, and more than half the value of the house has passed into the pockets of the landlord.

You have got cases in London here. There is the famous Gorringe case. In that case advantage was taken of the fact that a man had built up a great business. The landlords said in effect, "You have built up a great business here ; you cannot take it away ; you cannot move to other premises because your trade and goodwill are here; your lease is coming to an end, and we decline to renew it except on the most oppressive terms." The Gorringe case is a very famous case. It was the case of the Duke of Westminster. Oh, these dukes, how they harass us !

Mr. Gorringe had got a lease of the premises at a few hundred pounds a year ground-rent. He built up a great business there as a very able business man. When the end of the lease came he went to the Duke of Westminster, and he said, "Will you renew my lease? I want to carry on my business here." The reply was, "Oh, yes, I will; but only on condition that the few hundreds a year you pay for ground rent shall in the future be £4,000 a year." In addition to that Mr. Gorringe had to pay a fine of £50,000, and to build up huge premises at enormous expense, according to plans approved by the Duke of Westminster.

All I can say is this — if it is confiscation and robbery for us to say to that duke that, being in need of money for public purposes, we will take 10 per cent, of all you have got, for those purposes, what would you call his taking nine-tenths from Mr. Gorringe?

These are the cases we have to deal with. Look at all this leasehold system. This system — it is the

system I am attacking, not individuals — is not business, it is blackmail. I have no doubt some of you have taken the trouble to peruse some of those leases, and they are really worth reading, and I will guarantee that if you circulate copies of some of these building and mining leases at Tariff Reform meetings, and if you can get the workmen at those meetings and the business men to read them, they will come away sadder but much wiser men. What are they? Ground rent is a part of it — fines, fees; you are to make no alteration without somebody's consent. Who is that somebody? It is the agent of the landlord. A fee to him. You must submit the plans to the landlord's architect, and get his consent. There is a fee to him. There is a fee to the surveyor; and then, of course, you cannot keep the lawyer out. He always comes in. And a fee to him. Well, that is the system, and the landlords come to us in the House of Commons, and they say: "If you go on taxing reversions we will grant no more leases." Is not that horrible? No more leases, no more kindly landlords, with all their retinue of good fairies — agents, surveyors, lawyers, ready always to receive ground rents, fees, premiums, fines, reversions. The landlord has threatened us that if we proceed with the Budget he will take his sack clean away from the hopper, and the grain which we are all grinding in order to fill his sack will go into our own. Oh, I cannot believe it. There is a limit even to the wrath of outraged landlords. We must really appease them ; we must offer up some sacrifice to them. Suppose we offer the House of Lords to them?

Now, unless I am wearying you I have just one other land tax to speak to you about. The landlords are receiving eight millions a year by way of royalties. What for? They never deposited the coal in the earth. It was not they who planted those great granite rocks in Wales. Who laid the foundations of the mountains? Was it the landlord? And yet he, by some divine right, demands

as his toll — for merely the right for men to risk their lives in hewing those rocks — eight millions a year !

I went down to a coalfield the other day, and they pointed out to me many collieries there. They said : " You see that colliery. The first man who went there spent a quarter of a million in sinking shafts, in driving mains and levels. He never got coal, and he lost his quarter of a million. The second man who came spent £100,000 — and he failed. The third man came along and he got the coal." What was the landlord doing in the meantime? The first man failed ; but the landlord got his royalty, the landlord got his dead-rent — and a very good name for it. The second man failed, but the landlord got his royalty.

These capitalists put their money in, and I asked, "When the cash failed, what did the landlord put in?" He simply put in the bailiffs. The capitalist risks, at any rate, the whole of his money ; the engineer puts his brains in ; the miner risks his life. Have you been down a coal mine? I went down one the other day. We sank down into a pit half a mile deep. We then walked underneath the mountain, and we had about three-quarters of a mile of rock and shale above us. The earth seemed to be straining — around us and above us — to crush us in. You could see the pit-props bent and twisted and sundered, their fibres split in resisting the pressure. Sometimes they give way, and then there is mutilation and death. Often a spark ignites, the whole pit is deluged in fire, and the breath of life is scorched out of hundreds of breasts by the consuming flame. In the very next colliery to the one I descended, just a few years ago, 300 people lost their lives in that way ; and yet when the Prime Minister and I knock at the doors of these great landlords, and say to them : " Here, you know these poor fellows who have been digging up royalties at the risk of their lives, some of them are old, they have survived the perils of their trade, they are broken, they can earn no more. Won't you give something towards keeping them

out of the workhouse? " they scowl at us. We say, "Only a ha'penny, just a copper." They retort, "You thieves ! " And they turn their dogs on to us, and you can hear their bark every morning. If this is an indication of the view taken by these great landlords of their responsibility to the people who, at the risk of life, create their wealth, then I say their day of reckoning is at hand.

The other day, at the great Tory meeting held at the Cannon Street Hotel, they had blazoned on the walls, " We protest against the Budget in the name of democracy, liberty, and justice." Where does the democracy come in in this landed system? Where is the liberty in our leasehold system? Where is the seat of justice in all these transactions? I claim that the tax we impose on land is fair, is just, and is moderate. They go on threatening that if we proceed they will cut down their benefactions and discharge labour. What kind of labour? What is the labour they are going to choose for dismissal? Are they going to threaten to devastate rural England by feeding and dressing themselves? Are they going to reduce their gamekeepers? Ah, that would be sad ! The agricultural labourer and the farmer might then have some part of the game that is fattened by their labour. Also what would happen to you in the season? No week-end shooting with the Duke of Norfolk or anyone. But that is not the kind of labour they are going to cut down. They are going to cut down productive labour — their builders and their gardeners— and they are going to ruin their property so that it shall not be taxed.

The ownership of land is not merely an enjoyment, it is a stewardship. It has been reckoned as such in the past, and if the owners cease to discharge their functions in seeing to the security and defence of the country, in looking after the broken in their villages and in their neighbourhoods, the time will come to reconsider the conditions under which land is held in this country. No country, however rich, can permanently afford to have

quartered upon its revenue a class which declines to do the duty which it was called upon to perform since the beginning.

I do not believe in their threats. They have threatened and menaced like this before, but in good time they have seen it is not to their interest to carry out their futile menaces. They are now protesting against paying their fair share of the taxation of the land, and they are doing so by saying : " You are burdening industry; you are putting burdens upon the people which they cannot bear." Ah ! they are not thinking of themselves. Noble souls ! It is not the great dukes they are feeling for, it is the market gardener, it is the builder, and it was, until recently, the small holder. In every debate in the House of Commons they said : "We are not worrying for ourselves. We can afford it, with our broad acres ; but just think of the little man who has only got a few acres " ; and we were so much impressed by this tearful appeal that at last we said: "We will leave him out." And I almost expected to see Mr. Pretyman jump over the table when I said it — fall on my neck and embrace me. Instead of that, he stiffened up, his face wreathed with anger, and he said, "The Budget is more unjust than ever."

We are placing burdens on the broadest shoulders. Why should I put burdens on the people? I am one of the children of the people. I was brought up amongst them. I know their trials ; and God forbid that I should add one grain of trouble to the anxieties which they bear with such patience and fortitude. When the Prime Minister did me the honour of inviting me to take charge of the National Exchequer at a time of great difficulty, I made up my mind, in framing the Budget which was in front of me, that at any rate no cupboard should be barer, no lot should be harder. By that test, I challenge you to judge the Budget.

¹ Editorial footnote in the 1910 source edition: "A reference to the by-elections which took place in Derbyshire, Yorkshire and Dumfries a few days before this speech was delivered, when the main issue before the electors was the Budget, which in each of the three divisions was supported by substantial majorities."

See Also

• David Lloyd George - the Chancellor who delivered it
• The 1909 People's Budget - the budget this speech defended
• The People's Budget: Speech Introducing the Finance Bill (1909) - his Commons speech introducing the same budget
• Winston Churchill, The People's Rights (1910) - Churchill's parallel 1909 land-monopoly campaign
• Unearned Increment - Narrative: The Unearned Increment - the argument the speech popularised

Sources

1. David Lloyd George, "The Land and the People" (Limehouse, 30 July 1909), in Better Times: Speeches by the Rt. Hon. D. Lloyd George, M.P., Chancellor of the Exchequer (London: Hodder and Stoughton, 1910), pp. 144-156. Public domain. Full text digitised by the Internet Archive: bettertimes00lloyrich (OCR text: bettertimes00lloyrich_djvu.txt) - the source edition for the complete text reproduced above — used for the full speech text, the 1910 edition's editorial footnote on the Derbyshire/Yorkshire/Dumfries by-elections, and the editorial note's quotations (the "golden swamp" increment passage, the Duke of Northumberland school-site and Gorringe/Duke of Westminster lease cases, and the "stewardship" passage on reconsidering the conditions of landholding).