History has tied land ownership to freedom. Titles of nobility and, later, voting rights have been directly related to land ownership. But how did land ownership become a central part of American investment culture?
Let’s start with the Greeks. They weren’t American, of course, but we get many of our values (including our love of democracy) from the way Greeks ran their city-states. Consider the hoplites. Hoplites were the citizens of these ancient city-states. Individually, they were small farmers and landowners. Together, the hoplites of any given city-state were a formidable military force (they invented the phalanx formation). When their territory was attacked, they came together as a group of nearly unrivaled citizen-soldiers. This model set the tone for the rest of Western civilization, especially America.
In later feudal societies, noble fighters were rewarded for their service with land. Royalty changed the rules, but land still entitled its owners to rights that renters didn’t have.
In America, land ownership came at a military cost. Before, during and after the initial colonization of the northeast, Americans fought to keep the lands they believed belonged to them. A little like the hoplite citizen-soldiers of the Greek city-states, Americans took up their arms when necessary and went back to their farms when it was over. Even today, we praise George Washington for his citizen-soldier-like conduct. After fighting in the Revolutionary War, he could have become king of America. Instead, he put down his weapons and went back to his farm.
George Washington is sometimes compared to the Roman general Cincinnatus. Cincinnatus was called into battle in a dire situation and given nearly dictatorial power. After winning the war, Cincinnatus also went back to his farm.
In the 1840s and 50s, the image of a virtuous land-owning farmer was popular in American political rhetoric. In 1848, a Free Soil Party emerged, demanding that the newly acquired lands in the west be made available to smaller farmers instead of wealthy plantation owners. These politics eventually led to the Homestead Act of 1862, which promised nonviolent people above 21 years of age a share of the land in the west. After the Act, people rushed into the available land, claiming titles rapidly and expanding into new areas. The Act was revised as more and more of the land was homesteaded, and finally, in 1988, the last homesteader received his deed to 80 acres of land in Alaska.
Meanwhile and even before the Homestead Act, land developers were busy buying land for investment purposes. Famously, Fred Trump and his son Donald Trump made careers out of buying, developing, and selling real estate for huge profits. Interestingly, a Scottish farmer names Michael Forbes taught Donald Trump a small lesson about the meaning of property ownership when he refused to sell his farm, where Trump wanted to build a golf course, to the billionaire.
Today, middle-class Americans are the most enthusiastic purchasers of real estate in the world; while real estate investment in Europe is stagnant or on the decline, Americans continue to purchase and profit from developed and undeveloped real estate, keeping land ownership as a cornerstone of American culture.