from Duke University Economics
Shown is Francois Quesnay, founder of the physiocratic school of political economy. He was court physician to Louis XV and published the Tableau Economique (or Economic Table) in 1758. The first English translation was in 1766 described as;
THE OECONOMICAL TABLE An Attempt Towards Ascertaining and Exhibiting the Source, Progress, and Employment of Riches, with Explanations, by the friend of Mankind, the celebrated MARQUIS de MIRABEAU

Using the paradigm of an agricultural society, the Tableau traces the flow of production in a closed system. The unfortunate references to the barren (or sterile) advances for manufacturing or commerce were later used to discredit the analysis. But whether from a misapprehension over the peculiar terminology employed or a fundamental error of the school, the profound truths of the Physiocrats have been generally ignored. Still, Adam Smith who recognized the contribution of manufacturing and commerce had this to say of the Physiocrats in his An Inquiry Into the Nature and Causes of the Wealth of Nations

This system, however, with all its imperfections, is, perhaps, the nearest approximation to the truth that has yet been published upon the subject of political economy, and is upon that account well worth the consideration of every man who wishes to examine with attention the principles of that very important science.
Adam Smith, having studied the work of the Physiocrats extensively while residing in France, was most knowledgeable concerning the liberal, free-market orientation of the group. In the Wealth of Nations, Smith repeatedly refers to the real wealth as the annual produce of the land and labor of a society, consistent with the physiocratic emphasis upon land as the source of all wealth.

QUESNAY'S DISCIPLES

During the age of enlightenment in the latter part of the 18th Century, a number of eminent Frenchmen publicized and expanded upon the ordre naturel (natural order) advocated by Dr. Quesnay. They included Condorcet, Mirabeau, Mercier de la Riviere, Abbe Baudeau, Dupont de Nemours, Gournay*, and Turgot (finance minister under Louis XVI dismissed in 1776). The Physiocrats had their brief moment in the sun. But their philosophy of economic freedom was eclipsed and swept away with the advent of the French Revolution.

*Gournay is reported to have coined the term Laissez Faire Laissez Passer which roughly translates to- clear the way & leave things alone.

Thomas Paine was undoubtedly influenced by the "economists" since while residing in France he visited and had a close association with the physiocrat, Condorcet. In his tract, Agrarian Justice Paine advocated using the rent of land for public revenue. (See the Impot Unique below)

HENRY GEORGE AND THE PHYSIOCRATS

Although not a disciple of Quesnay since his analysis of the laws of the production and distribution of wealth as well as the radical nature of his remedy differed significantly from that of the Frenchman, the affinity of Henry George's philosophy to that of the physiocrats is apparent. The following extended quotes demonstrate his familiarity with their doctrines; Progress and Poverty; An Inquiry Into the Cause of Industrial Depressions and of Increase of Want With Increase of Wealth...The Remedy, 1879, Henry George

But there has been a school of economists who plainly perceived, what is clear to the natural perceptions of men when uninfluenced by habit-that the revenues of the common property, land, ought to be appropriated to the common service. The French Economists of the last century, headed by Quesnay and Turgot, proposed just what I have proposed, that all taxation should be abolished save a tax upon the value of land. As I am acquainted with the doctrines of Quesnay and his disciples only at second hand through the medium of the English writers, I am unable to say how far his peculiar ideas as to agriculture being the only productive avocation, etc., are erroneous apprehensions, or mere peculiarities of terminology. But of this I am certain from the proposition in which his theory culminated-that he saw the fundamental relation between land and labor which has since been lost sight of, and that he arrived at practical truth, though, it may be, through a course of defectively expressed reasoning. The causes which leave in the hands of the landlord a "produce net" were by the Physiocrats no better explained than the suction of a pump was explained by the assumption that nature abhors a vacuum, but the fact in its practical relations to social economy was recognized, and the benefit which would result from the perfect freedom given to industry and trade by a substitution of a tax on rent for all the impositions which hamper and distort the application of labor was doubtless as clearly seen by them as it is by me. One of the things most to be regretted about the French Revolution is that it overwhelmed the ideas of the Economists, just as they were gaining strength among the thinking classes, and were apparently about to influence fiscal legislation.

Without knowing anything of Quesnay and his doctrines, I have reached the same practical conclusion by a route which cannot be disputed, and have based it on grounds which cannot be questioned by the accepted political economy.

From the dedication to Protection or Free Trade ,1886, Henry George

To the memory of those illustrious Frenchmen of a Century ago Quesnay, Turgot, Mirabeau, Condorcet, Dupont and their fellows who in the night of despotism foresaw the glories of the coming day

The Science of Political Economy, 1897, Henry George

...In their practical proposition, the single tax, they proposed the only means by which the free trade principle can ever be carried to its logical conclusion-the freedom not merely of trade, but of all other forms and modes of production, with full freedom of access to the natural element which is essential to all production.

...These French "Economists" now more definitely known as Physiocrats, or single taxers, had got hold of what in its bearings on philosophy and politics is probably the greatest of truths; but had got hold of it through curiously distorted apprehensions. It was to them, however, like a rainbow seen through clouds. They did not see the full sweep of the majestic curve, and endeavored to piece out their lack of insight with a confused and confusing terminology. But what they did see showed them its trend, and they felt that natural laws could be trusted where attempts to order the world by human legislation would be certain to go astray.

The natural order, free trade, free markets, free men & the Impot Unique- such is the affinity of Henry George with the Physiocrats.

THE IMPOT UNIQUE

The Physiocrats advocated the impot unique to make the landowners of France pay for the expenses of the sovereign thus avoiding the onerous taxation of the peasants, workers, and cultivators of land. It was to be a levy on the value of land exclusive of improvements such as crops, houses, barns, fertilization- as well as the wealth* produced by labor and capital utilizing land, the source of all wealth.

It has been estimated that the impot unique would have collected about one- third of the land rent (ground rent) for sovereign expenses. But even this moderate reform was never implemented. Henry George's proposal for a "single tax"** on the ground rent was more radical involving collection of all or virtually all of the ground rent for public or community purposes. Private landowners would have exclusive use and possession of their land without arbitrary confiscation by the political state. But profit or gain solely from the holding of a land title as well as land speculation which is so prevalent in and around cities would be foreclosed.

*In political economy, a concise, functional definition of wealth is-tangible products of human effort (labor) having exchange value. Capital is wealth used to produce more or other wealth. Thus evidences of indebtedness or obligation; land, money, stocks, bonds; are no part of the wealth of nations. Even the great Adam Smith fell into confusion on occasion by designating certain attributes of labor as capital.

**There is a paradox in the concept of the "single tax." In form, it may appear as another type of tax but, in substance, it is a taking by the community of that value exclusively created by the community since the genesis of ground rent is a) population combined with b)production. The landowner qua landowner is a parasite on production.

SMITH AND RICARDO ON THE RENT OF LAND Although not advocates of the Impot Unique as were their French predecessors, Adam Smith and David Ricardo were well aware of the important difference between land and capital and between ground rent and interest (or the yield on stock) as the following selected quotations demonstrate;Wealth of Nations, Book I, Chapter X, Part I

The rent of land not only varies with its fertility, whatever be its produce, but with its situation, whatever be its fertility. Land in the neighborhood of a town gives a greater rent than land equally fertile in a distant part of the country.

Book I, Chapter XI, Conclusion

I shall conclude this very long chapter with observing that every improvement in the circumstances of the society tends either directly or indirectly to raise the real rent of land, to increase the real wealth of the landlord, his power of purchasing the labour, or the produce of the labour of other people.

Book V, Chapter II, Article I

Both ground-rent and the ordinary rent of land are a species of revenue which the owner, in many cases, enjoys without any care or attention of his own. Though a part of this revenue should be taken from him in order to defray the expenses of the state, no discouragement will thereby be given to any sort of industry. The annual produce of the land and labour of the society, the real wealth and revenue of the great body of the people, might be the same after such a tax as before. Ground-rents, and the ordinary rent of land, are, therefore, perhaps, the species of revenue which can best bear a peculiar tax imposed upon them.

Principles of Political Economy and Taxation by David Ricardo, On Rent

If all land had the same properties, if it were unlimited in quantity, and uniform in quality, no charge could be made for its use, unless where it possessed peculiar advantages of situation. It is only then, because land is not unlimited in quantity, and uniform in quality, and because, in the progress of population, land of an inferior quality, or less advantageously situated, is called into cultivation, that rent is ever paid for the use of it. When, in the progress of society, land of the second degree of fertility is taken into cultivation, rent immediately commences on that of the first quality, and the amount of the rent will depend on the difference in the quality of these two portions of land.

When land of the third quality is taken into cultivation, rent immediately commences on the second, and it is regulated as before by the difference in their productive powers. At the same time, the rent of the first quality will rise...

Independently of these improvements, in which the community have an immediate and the landlords a remote interest, the interest of the landlord is always opposed to that of the consumer and manufacturer....The dealings between the landlord and the public are not like dealings in trade, whereby both the seller and buyer may equally be said to gain, but the loss is wholly on one side, and the gain wholly on the other...

CONCLUSION

Political economy is the study of the natural laws governing the production and distribution of wealth. In their systematic analysis of the process and their emphasis on the ordre naturel, the physiocrats merit the distinction of being the founders of political economy. The Impot Unique remains to be implemented as does their legacy of free trade and free markets.