Land reform policy to reduce inequality in society by Khana Ratsadon
After the Siamese Revolution of 1932, the Khana Ratsadon had the intention to push for an important policy reform which was land reform. The objective was to respond to principle 3 of the 6 principles declared by the Khana Ratsadon, which stated that 'the people's economy must be fully nurtured by the government by creating jobs for the people to work to their full potential. The National Economic Development Plan will be drafted, leaving no one behind.'
The land reform policies began to emerge in the economic program of Luang Praditmanutham (Pridi Banomyong), which is a main topic to be discussed later in this article. This article will begin by presenting an overview of the economic and social conditions of Siam before the change of government. After that, it will explain the land reform policies specified in the economic program and conclude with an attempt to reform land ownership during the government of Field Marshal Plaek Phibunsongkhram, which was a major effort of the Khana Ratsadon group after the revolution.
The economy and society
The economy and society in Thailand prior to the regime change were affected by World War I, although Siam did not suffer direct impacts from the war. The economic system in Europe, which Thailand was integrated into after signing the Bowring Treaty in 1855, had a ripple effect on Thai society. This was because Siam had become a part of the global economy after joining the treaty, which eventually led to the impact of World War I on Thai society.
When the economy in Europe declined due to the poison of war, it resulted in rice, teak wood, and rubber, which were exported at lower prices and were not sold in foreign markets as expected. This led to a decrease in Thailand's income compared to before. In 1930, the Thai government solved the problem by cutting expenses to ensure that the budget was not in deficit by reducing salaries of civil servants and cutting military budgets.
However, the price adjustment of goods, the reduction of civil servant salaries, and the reduction of military budgets were only a part of the root of the problem in Thai society at that time. The main problem in Thai society at that time was the lack of major occupations, which were only civil servants and farmers.
To speak specifically to the farmers and citizens of Siam who made their living as farmers at that time, life was difficult. According to a survey conducted by Carl C. Zimmerman, an American sociologist hired by the Siamese government to study the rural economy in 1930, it was found that the majority of the Siamese population worked as tenant farmers, renting land from landowners. The percentage of land rental in each region was as follows: in the central region, about 36% of farmers did not own their own land; in the northern region, 27%; in the southern region, 14%; and in the northeastern region, 18%. In particular, in the province of Thanyaburi (which was later merged into Pathum Thani province), it was found that the majority of farmers were tenants, with about 85% of them renting land from companies that came in to develop canals and cultivate land for agriculture at that time. Such companies included the Siam Canals, Lands and Irrigation Company and the ruling class of Siam.
The land is characterized by small, scattered plots owned by multiple owners, which limits the potential for full utilization of the land. One farmer has land that is spread far apart and another has only one small plot, which requires a great deal of physical labor to cultivate and maintain, with only minimal returns. The cost of farming is high, including interest payments on loans, rental fees, taxes on livestock, crop taxes, and military service fees, which are often redundant and unfair. As a result, the yields from cultivation are only enough to sustain the farmers and their families.
The land ownership of large plots of land by high-class landowners who reside outside the area, such as land rights in the Rangsit area, resulted from the excavation of canals. The local people who invaded and occupied the land understood that they had the right to the land because they had encroached and benefited without realizing that the land rights system had been replaced by a new system instead of traditional land ownership. This has led to meaningless land ownership and benefits, leading to disputes between landowners and farmers who have invaded and occupied and benefited from the land as tenants, both in terms of falsifying land ownership documents resulting from conflicts of overlapping land rights issued by various agencies at the same time, or driving away farmers who have invaded and occupied the land in accordance with government policy, as well as adjusting the rental rates of the land.
The land reform measures outlined in the economic development plan
After the coup d'état, the government of Phraya Manopakorn Nititada appointed Luang Praditmanutham (Pridi Banomyong) to play a role in the development of the "Economic Blueprint", one of the proposals of which was the reform of land ownership.
The main content of the Economic Blueprint was to change the economic system of Siam from a limited role for the state in a free-market economy that allowed resource allocation to be driven by market mechanisms to a cooperative socialist society. The state would have a role in planning the economy and use cooperatives to implement policies to allocate resources.
In terms of land acquisition method, Pridi proposed in his economic plan that "...the government should buy back those lands. It is believed that many landowners who have mortgaged their lands would be happy with this proposal because keeping the land with mortgages or using them as collateral only results in losses. Buying the land back is a different method than the communist's approach of seizing properties. Therefore, the government should buy the land back from private individuals and make them state-owned because at that time land prices had decreased, and the landowners could not collect rent from farmers as they were incurring losses. Selling the land to the government would be the best option for landowners to benefit from the land prices. Pridi suggested that the government issue loans to the landowners based on the land prices, and consider them as debtors of the government (similar to government bonds today). The government would pay interest on the loans at the prevailing interest rate. In Pridi's view, this method was better than keeping land deeds or important documents in such a situation since landowners would not benefit from being debtors.
Apart from that, acquiring government land through this method is not a forced seizure of land, but rather a voluntary buyback of land from landowners, specifically for economic purposes such as agriculture or plantation lands, excluding residential lands.
Regarding the motivation behind drafting this economic project, Pridi has explained to the National Economic Committee that the project is based on a socialist approach, not communism. He believes that everyone is born to be both a debtor and a creditor, according to the philosophy of solidarisme that he holds. The state's allocation of land is therefore intended to solve structural problems that arise from unfair resource allocation. Moreover, he sees the reality of society in that the wealth of an individual does not arise solely from their labor, but also from the collective efforts of the community. Therefore, it is necessary to share the burden and risks together.
However, Pridi's proposal was opposed by the government of Phraya Manopakorn Nititada, along with the use of the royal judgment of His Majesty King Prajadhipok as a reason to reject the economic project.
One interesting aspect of the political and economic situation is the explanation given by Apichart Satitniramai and Isarukul Unakul. They mentioned that the economic reform plan, which involved the government purchasing land from private companies, had an impact on the ruling class at the time, including the royal treasury, which owned the largest landholdings in the country. Land reform was therefore unacceptable to the ruling class as land was considered a source of wealth for them. Apichat Satitniramai and Itsakul Unahakate cited the work of Akira Suehiro during the 20th century, which showed that owning land in the royal treasury gave the highest economic benefit at 25%, compared to other modern businesses such as railways, banks, and shipping, which only gave a return of 4-12%.
The political conflict between the Democrats and the government of Phraya Manopakorn Nititada led to a silent coup by declaring a royal decree to close the parliament of representatives and appoint a new cabinet, which resulted in the suspension of some provisions of the constitution. Eventually, on June 20, 1933, Phraya Phahonphonphayuhasena restored power to the democratic regime and ended the role of the government of Phraya Manopakorn Nititada. Following these events, the attempts to reform land according to the economic plan stalled, and in 1933, Phraya Songsuradet, the Minister of Commerce in the government of Phraya Phahonphonphayuhasena, proposed utilizing unused and vacant land as an alternative to land reform according to the economic plan.
The land reform policy during the era of Field Marshal Plaek Phibunsongkhram
The land reform was once again brought up during the time of Field Marshal Plaek Phibunsongkhram between 1948-1957. The land reform policy of General Prem was a result of Thailand's economic situation after World War II. The country had the obligation to export rice to pay for war reparations, which led to an increase in the price of rice and a resurgence in land accumulation. In addition, the problem of labor shortage also contributed to the increasing pressure from the population on land, leading to conflicts over land issues.
In addition to this, the political situation of Field Marshal Plaek Phibunsongkhram's era, which was in a tripartite political system, made it difficult for him. Therefore, gaining political support from the people and accepting policies from the United States played an important role in creating popularity for Field Marshal Plaek Phibunsongkhram. This situation led to a law that gave the government the power to revoke land deeds issued without approval, in order to compete for land rights with the people. The law also cancelled unjust land deeds and redistributed them to the people.
Another measure that Field Marshal Plaek Phibunsongkhram's government has implemented is land ownership restrictions. They attempted to propose a new law by compiling land laws that prohibit holding land over 50 rai (about 20 acres) without permission from the provincial governor. However, it should be noted that this policy was reviewed by the meeting of representatives of the people's assembly, and the government agreed to amend the draft land law without retroactive effect, so as not to affect the landowners during that time. However, in reality, Field Marshal Plaek Phibunsongkhram's land ownership restriction policy had to come to an end with his coup d'état.
It can be said that the problem of land reform in Thailand is largely driven by the political motivations of the country's ruling class, who have played a role in obstructing the land reform process in order to maintain their own economic interests at different times. Although such policies would have had the beneficial effect of reducing social inequality, the important factor in why the ruling class did not want to undergo land reform was due to how such reform would impact their existing wealth and vested interests in society.