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The Only Economic Reform Worth Talking About
Edward Miller   Aug 8, 2011   Embrace Unity  

The real solution has nothing to do with techno-utopianism, monetary reform, austerity, or any of the other ideological cul-de-sacs currently being promoted.


The world is a complex place, or so we are told here in the USA.

The pundits and journalists will tell you that there are no simple remedies to our problems, with an air of authority reserved only for those serious few with the courage to offer up this sober dose of “reality.” Besides, even if there were a simple solution, we can’t agree on the most basic of things anyways, since we are so “polarized,” or so the narrative goes.

So instead of actually solving problems, the best we can hope for is a series of convoluted band-aid solutions to fix whatever crisis is at hand.

Is unemployment soaring? Let’s produce a pathetic stimulus package that mixes the worst of both Keynesian and supply-side ideology.

Plagued by deficits? Let’s spend all our political energies on bickering about whether the top tax bracket should be 35% or 39.6%.

Of course we mustn’t forget to provide generous amounts of corporatism to the already-privileged.

So if the climate is in crisis, let’s give tradable pollution licenses based on how much one has been polluting historically, and give it a cute name like Cap and Trade.

And if prices in our cartelized healthcare sector are skyrocketing, just force everyone to buy private health insurance and label that “progressive.”

Everyone seems to agree there is something seriously wrong with the modern American political discourse. Some blame the Left, some blame the Right, and a fair number are now blaming the Center.  There is plenty of blame to go around, and I would contend that we have a failure of critical thinking on the part of our intellectuals of all stripes.

It is undoubtedly the case that our establishment intellectuals are not chosen on the basis of their merit, but mostly on their compatibility with the interests of the privileged classes. Yet, I’m not just blaming the establishment figures; I’m blaming all politically-minded citizens who buy into their oh-so serious arguments and false political divisions.

What if I told you there was a solution which transcends political divisions? Which is consistent with the ideals of our Founding Fathers? Which can be implemented anywhere on the local, state, or federal level? Which can increase our overall prosperity, reduce inequality, promote peace, and improve the environment all at the same time? Which can do all this without any major restructuring of our institutions?

Assuming such a remedy even exists, surely it would be controversial, right? Something which all the various political ideologies could never agree on? Well the remedy does exist, and it has been supported by principled people of nearly every political persuasion, including some of the greatest minds in history.

The answer has nothing to do with techno-utopianism, monetary reform, austerity, or any of the other ideological cul-de-sacs commonly promoted.

Remedy, you say? That’s preposterous!

It goes by the unassuming moniker of the Land Value Tax (LVT), which was most famously promoted by the American political economist Henry George. It is based on the notion that people ought to own what they produce, but since land is not a fruit of labor, private land ownership has no basis in natural rights and is thus the ideal source of government revenue.  The Land Value Tax preserves the land title system, but simply makes it expensive to hoard land in unproductive ways.

Unlike common property taxes, the LVT does not count improvements to the land, such as buildings. Buildings are man-made, but land isn’t. When you tax buildings, you discourage people from building. Yet, when you tax land, the amount of land doesn’t decrease. The supply is fixed.

The Land Value Tax is an idea that has united in support people who would generally be considered political rivals: William F Buckley and Ralph Nader, Joseph Stiglitz and Milton Friedman, Aldous Huxley and Henry Ford, Clarence Darrow and William Jennings Bryan, Winston Churchill and David Lloyd George, the list goes on.

By untaxing labor and shifting as much taxation as possible onto land values, we enhance the incentives for production as desired by fiscal conservatives. Yet, it provides a huge source of natural and community-generated wealth to tap into, which is the ideal funding mechanism for virtually any infrastructure project or social program desired by those on the Left.

Those of a more “geo-libertarian” bent would prefer that revenue be distributed as a Citizen’s Dividend, rather than used to fund bureaucracy. Yet, if the funding of bureaucracy is to come from somewhere, they would strongly prefer it come from land values. Milton Friedman called it the “least bad tax” for this reason, but really it is far more profound than that.

The LVT strikes at the heart of the land monopoly. In a powerful speech, Winston Churchill said, “Land monopoly is not the only monopoly, but it is by far the greatest of monopolies — it is a perpetual monopoly, and it is the mother of all other forms of monopoly.” It is the essence of feudalism and for all of our supposed social progress we’ve yet to be free from it. Unless and until the land monopoly is destroyed, the positive effects of virtually all economic reforms and even philanthropy is largely nullified.

Profits that are above those necessary for the production process are called economic rents. One of the primary sources of rents is monopolization, and one of the greatest tools for achieving monopolization is actually government intervention on behalf of the monopolists. Historically, every major monopoly has been the beneficiary of enormous state-granted privilege. Whether it’s AT&T, Microsoft, or Standard Oil, the root of their power can invariably be traced to particular political privileges.

Taxing such privilege causes no disincentive for production because rents have nothing to do with production, they are a result of imbalances in power and imperfections in the market. Land, and the fruits of nature generally, is necessary for all production and even life itself. Therefore, when access to it is concentrated into the hands of a few, the rest have essentially no bargaining power.

Who owns the Earth?

If all land on Earth is owned by a subset of the population, then the landless attain a status akin to that of trespassers on the Earth. If – as our moral instincts inform us – we all have a birthright to access the Earth, then this realization must be reflected in our political institutions. A Land Value Tax system recognizes that land titles are a practical way of allocating land use rights, but that the proceeds from such monopolization over locations on the Earth must be returned to their rightful owners, the community as a whole.

Really it isn’t a tax at all, in the usual sense of confiscating that which one produces. On the contrary, by allowing eternal sovereignties over our common inheritance without any repayment to society, one has essentially granted a subsidy to the landlords. Whenever anyone in the community does anything to improve the region, the land values rise. This occurs no matter what the intentions were. If a do-gooder builds a community center in an impoverished area, the land values and rents increase. Instead of helping the poor tenants in the region, the do-gooder may have just helped them right out of a home. Whilst the landlord could have been sleeping through the whole thing, and in the end see his land values rise.

Invent something to improve harvests? Excellent, more rent for the landlords and the exact same wages for labor. The same story could be said of welfare programs, basic income guarantees, and the like. If activists fight hard and turn the region into a bastion of civil liberty which attracts people from all around, it doesn’t matter if the landlords were sleeping or actively opposing the activists, they will see their land values rise, and the tenants will see their rents go up. The same is true again of government infrastructure projects, and anything else which makes a region attractive.

Back when I was a run-of-the-mill progressive, I would often echo progressive sentiments about how awful it is that people are forced into dangerous and low-wage jobs. This would provoke respectful but spirited debates with those who call themselves “libertarians.” They would say that nobody is forcing them to work. They were voluntarily agreeing to work.

Such debates were common around the Enlightenment. Thomas Malthus reacted to the Enlightenment notions about freedom leading to a golden age of prosperity.  He claimed that natural resource scarcities and breeding patterns inevitably cause markets to reduce wages down to subsistence. He called this the Iron Law of Wages. He was certainly correct that something about the market system of his day (and our day), tends to drive wages down to a bare minimum. Yet, his emphasis on natural scarcities and overpopulation was unfounded.

David Ricardo responded forcefully to Malthus, and argued that actually the trends being witnessed were the result of what became known as the Law of Rent. Ricardo’s analysis of rent proved that once all freely available land is claimed, then as production increases, rent will eat up virtually all of the increase in production. This explains why all of the amazing technological improvements of the day were doing nothing to improve the conditions for the large masses of landless paupers.

This is why technology alone can’t save us; we need systemic reform. If you’re aware of the problems in the biotech industry regarding the patenting of life, you should recognize that is very much like another form of land monopoly, as it creates private sovereignties over the fruits of nature which should belong to all. Yet, biotech also increases the rent of real estate simply by improving crop yields or indeed whenever it does anything of value at all.

Same with any other advanced technology. We can’t rely on the super-rich to build us all nano-fabricated housing projects out of the goodness of their hearts, we need to reign in the privilege bestowed by the state upon private entities. I’m confident that the day they figure out how to upload minds into computers, they’ll still find a way to make you pay rent.

Ideology doesn’t matter; we’re in this together

While not everyone bases their political views on principles, I am confident that most do. In the case of LVT, it isn’t Right vs Left, but the principled vs the corrupt. Any serious political view, short of misanthropy, has every reason to support it.

- If you are an environmentalist, you should support Land Value Taxation in order to spark more efficient use of land.  We’d still require all the usual mechanisms to internalize externalities, but the LVT alone would encourage all the more sensible agricultural practices promoted by environmentalists, such as permaculture and vertical farming. Industrial monoculture and factory farming is highly land-intensive. If holding land becomes expensive, then the markets would more accurately reflect the social costs of such massive landholding.

- If you are a humanitarian, you should support Land Value Taxation primarily because until the land monopoly has been defeated, no amount of philanthropy can possibly stop the trend of wages tending towards subsistence.

- If you are a serious technocrat, you should support LVT in order to reduce unemployment, increase wages, and promote peace.  On a local scale there is evidence of all of this, including reduced crime rates. I have no doubt that if countries follow this model, we will see many former enemies become prosperous interdependent trading partners.

- If you believe in natural rights, you should support Land Value Taxation in order to end the confiscation of honest income and interest, and return that which belongs in the commons. The concept of the LVT really has its roots in the writings of people like Adam Smith, Thomas Paine, and others who passionately believed that labor is the sovereign property of the individual, but that the Earth is our common inheritance.

“Men did not make the earth… it is the value of the improvement only, and not the earth itself, that is individual property. Every proprietor owes to the community a ground rent for the land which he holds.” – Thomas Paine

Especially you, Progressives

It hardly seems possible that a concept which was supported by many of the original free market capitalist ideologues could be a progressive one. Yet, if you are a progressive, you absolutely should support Land Value Taxation, not as a small footnote of a larger platform, but as a central tenet.

The ideas of Henry George and the Single Tax Movement were one of the original inspirations of the Progressive Movement in the early 20th Century. Progressives like John Dewey were awestruck by the power of the arguments of Henry George in his masterpiece Progress and Poverty.

Of Henry George, Dewey wrote, “No man, no graduate of a higher educational institution, has a right to regard himself as an educated man in social thought unless he has some first-hand acquaintance with the theoretical contribution of this great American thinker.” To this day, some of the most principled progressives like Dennis Kucinich and Ralph Nader have drawn inspiration from him.

When you look at any vast fortune, you will virtually always find the heavy hand of government as part of the essential underpinning. Whether it is through regulatory capture, patents, state-sponsored licensing cartels, corporate personhood, or any other sort of government-granted privilege. Yet, as long as the mother of all monopolies remains, it would make no difference how many of those other privileges were struck down. The land monopoly would absorb all the of the difference that the elimination of privilege might otherwise have made.

It is true that even under our land monopoly there are a small subset of progressive reforms that improve conditions of the lower classes, though often in an imprecise or inefficient manner.  Yet, the only way one can even know what those are is though an understanding of the land monopoly. The reforms I am speaking of are very much like the previously mentioned artificial scarcities which favor big business. I am speaking of artificial labor scarcities.

The Fair Labor Standards Act of 1938 is a perfect example of this.  By banning child labor and establishing the Eight Hour Day via overtime legislation, the FLSA restricted the supply of labor, increased leisure, and reduced the number of unemployed. Most think of it as the law which established the first federal minimum wage, but actually that was more like an afterthought meant to encourage automation in light of the artificial labor scarcity. The post-war economic boom and creation of the middle class was a result of such labor scarcities.

Unfortunately it is difficult to enforce overtime laws, and nowadays businesses have become so proficient at evading this regulation that it is practically non-existent for most. As with the income tax, overtime laws are not that difficult for people to evade. Even if it were a good idea, the government simply can’t be very efficient at sticking its nose into every business deal.

Land, however, cannot be hidden. It would therefore be much harder for individuals to evade. Thus, compared to many other economic reforms, it is fair, efficient, and straightforward. Our current system of real estate assessment would not even need to change drastically, and it could obsolete certain agencies like the IRS.

Income taxes cannot be truly progressive, by their nature, no matter what sorts of brackets are in place. Taxing income does not change the fundamental market power of individuals, and as such the burden of taxes are just passed around until the income distribution reflects market power. Again, it wasn’t income taxes that created the modicum of equality after WW2, it was merely labor scarcities, and those can only do so much.

Additionally, we are suffering under the volatility of speculative land bubbles, like the recent mortgage crisis, which are a byproduct of the land monopoly. People like to point to all sorts of things like CDOs, derivatives, credit default swaps, and so on, yet they ignore that each of these are predicated on the ability to speculate on land. The LVT would change all that in a truly progressive manner, and end the volatile land bubbles. It would reshuffle market power in favor of productive activity and away from unproductive hoarding of land. Most importantly, it would allow us to actually benefit from other sorts of reforms, and as such must be the top priority. Until then we’re merely reshuffling deckchairs on the Titanic.

Bring on The Remedy

There is hope. The hope lies not in austerity, monetary policy, deficit spending, or even technology. That last one was a hard pill I had to swallow, but the sooner we all accept that the better.

The beauty of this simple reform is almost surreal. It solves so much, yet asks so little. Instead of increasing bureaucracy, it would reduce it. Instead of weakening incentives for production, it would actually create them. Instead of encouraging waste and urban sprawl, it would promote efficient use of land. 

The LVT has been experimented with in many times and places, and it has always succeeded to the extent that it was tried. It holds the potential for uniting principled minds of every persuasion, if only we can break free of the ignorance espoused by the talking heads who tell us that the only remedies available are painful and complex.

Let’s show those bastards that they’re wrong. A better way is possible, and through it we can finally reach that golden age we’re always dreaming of.

Edward Miller, a former intern of the IEET, is the Chief Information Officer of the Network for Open Scientific Innovation. He is a passionate advocate of Open Source development models. His blog, EmbraceUnity, deals with democracy, humanism, and sustainable development.



COMMENTS

As far as liberal reform goes, this idea sounds worthwhile. I’m utterly unconvinced by the grand claims. The kind of change I’m interested in cannot come by remixing capitalism and bourgeois government.

I’ve often felt that citizenship at the age of majority should come with an automatic land entitlement.

The fact that some of us own land and some do not keeps us somewhat rooted in a feudal system. We even call the owners of this land “landlords”.

Capitalism is great for those who own capital. Likewise, property ownership is great for those that own property.

However, the monopolists (i.e. Hegemons) are repossessing all property (foreclosures - amongst other tactics).

All citizens should be required to own at bare minimum one piece of land property. This property should be gifted to the free citizen upon reaching the age of majority, and should be non-transferable (cannot be sold - so that the person no longer holds land, which would be equivalent to renouncing citizenship - unless that person also holds another piece of land somewhere else - it should be illegal to transfer one’s sole and only piece of land).

In this way, regardless of one’s fortunes in life, regardless of how far one goes, every person who is a free citizen would, at bare minimum, always own at least one piece of property (and thus there would be zero homelessness).

This would make it much easier (and cheaper) to do charity work. Handing out free food is much simpler than dealing with hordes of homeless people.

Less poverty would mean the population would find it easier to get into high gear and innovate (Maslow’s hierarchy in effect here - end homelessness, and people then concentrate on moving up).

So, in addition to your tax proposal idea, we should also be assigning everyone a parcel of property at the age of 18.

Like super-homesteading.

iPan,

You might like this quote.

“How can a man be said to have a country when he has not right of a square inch of it.” - Henry George

Didn’t read this piece at all because it is too rich for my mind to take in except over a period of several days. Will try to get back to it later.
But we might have to go the way of the Soviet Union and REALLY devolve—into our component regions. Way back when, Ben Franklin couldn’t have foreseen such large states such as California and Texas. Franklin allegedly said, “a republic, Ma’am, if you can keep it.”
Today it might be: ‘a republic, Ma’am, if you can devolve it’.

post-post brings up an interesting idea.

I wouldn’t mind if the US split up into several smaller nations.

The west coast (CA, OR, WA, and maybe HI) would make a great Pacific Coalition.

It has been mentioned before at IEET, by—if memory serves—Hank or Mike.
It is nothing new.

post-post I have an introductory essay on my site entitled “How to End Poverty”. If you read that, you would have a good base for understanding this article and likely grasp most of the central points of Georgism. http://www.shwartzlucas.com/?page_id=54

I’ve discussed George extensively over on Longecity (aka Immortality Institute forums) 

The one point I think George missed about why “rent seeking” exists is the human drive for “Status symbols” or which money, land monopolization, wealth hoarding, etc, are all symptomatic of.

While I think the LVT is a good idea, so long as our current “pecking order” remains in force, land ownership remains the core component of “elite status” and this inverted pyramid in which the most productive support the least productive in lives of luxury. Fortunately the pillars supporting this inverted social structure are in the process of being eliminated by technological advance.

We have a spending problem. Thinking we can tax our way out of this mess is simply wrong. It is like figuring out how to give an addict more heroin. The federal and state governments are all bankrupt.  We can’t raise taxes anymore. All it does is take more money out of the private economy which slows down growth. High taxes are why we have a recession. We should only consider new taxes if they replace the existing tax system.

Edward Miller makes a superb, concise case for LVT. I will use these memorable words whenever I promote LVT here in the UK! ‘It solves so much, yet asks so little. Instead of increasing bureaucracy, it would reduce it. Instead of weakening incentives for production, it would actually create them. Instead of encouraging waste and urban sprawl, it would promote efficient use of land.’ The case for LVT in a nutshell!

Great article!  Thanks for covering it—there are a few places to learn more about Henry George - an entire school in San Francisco: http://www.henrygeorgehistoricalsociety.org/
http://henrygeorgesanfrancisco.org/contact_us

I followed the last link and learned immensely more as well, highly recommended—for example, that (very successful) Singapore was founded on Henry George’s principles

I lived in Monteverde, Costa Rica, for a year - it was founded by Quakers from Fairhope, Alabama, a Georgist planned city.  The Quakers there are great land stewards -

Here’s a bit of comic relief; this writer has always wanted to marginalize Obama yet he complains Obama is now utterly irrelevant to the economy. The author is someone who gets what he wants then he doesn’t want it anymore. What he really wants is for Obama to have plastic surgery done so he looks like Reagan!: http://spectator.org/archives/2011/08/09/meltdown-but-why

The question that comes to my mind is whether the Land Tax would be a flat rate. Would we tax the native reserves in the desert or tundra the same amount as a Nebraskan farmer or a Manhattan land lord? What about the value of mineral below the land? Would oil wells increase the tax over growing kumquats?

One of the interesting concepts in the Old Testatment (my apologies for going all religious on you) is that no one owns land at all. You lease it for a period of time, but every fifty years it returns to the ancestral family who was given responsibility for it when the Israelites settled their land. The idea behind this law, was as Edward is suggesting, a breaking of the monopoly on ownership of land.

What would happen if it was made law that no one could “own” land, and instead we leased it for say fifty years after which we would have to return it to the community in at least as good a condition as it was when we started?

This issue of land monopoly is the reason for much of the suffering in the developing world. Land that used to grow food is now growing commodities. Land in Africa is being snatched up at a scary rate and it will only get worse.

Pastor Alex,

Just as assessors do now, the land would be assessed for its estimated market rate, but all buildings and improvements would be subtracted from the taxable value.

Your idea of 50 year leases is not as good because land values change over time. It is best that they are reassessed every year in order to more accurately reflect their true price, and nobody would sign any leases.

Rather, as long as they held the title they’d be subject to that annual tax, which they can get out of at any time by selling the land. The problem is not how long they hold the land, the problem is that a huge portion of the natural and community-generated wealth is unjustly pocketed by landlords.

As I’ve mentioned on a number of transhumanist blogs, somethng like this is almost certainly in the Extrapolated Volition of humanity.  I’ve been very impressed with the Georgists, since it’s genuinely a solution that is in another dimension to the conventional left/right dogmas.  It’s also based on solid cognitive science, in that there appear to be 3 quite different modes of social interaction - Communal-based (socialist-like), Exchange-based (market like) and Authoritarian-based (conservative like) (see Pinker, Fiske).

The Georgists (in my opinion) get it right, in that they make the correct split between things which should be left to the market (the fruits of our own labours), and things which should be in the common domain (land).  By abolishing income tax and replacing it with the LVT, you would certainly both improve economic efficiency AND personal freedom, all the while maintaining government revenue.  In places where it’s been tried in part (see wikipedia entry - for exmaple Hong Kong) it appears to do exactly what proponents said it would. 

The only thing I would point out (see wikipedia entry) is that in the modern world, LVT alone wouldn’t be enough to maintain government revenue, so modern proponents have extended the idea to include all natural resources (not just land). 

But yes, it seems the perfect answer, move all natural resources into the common domain to maintain government revenue and at the same time abolish all income tax.  The modern version of the LVT could indeed raise sufficient revenue for Dr J’s Minimum Guaranteed Income (and it does all this with ZERO income tax Libertarians!)

mjgeddes,

Glad you can see the benefits, but I’d like to make a few clarifications.

It isn’t just that LVT can fund a “guaranteed minimum income,” rather such a proposal is doomed to failure unless it is funded by LVT. Without it, the rents would rise almost immediately after the checks were distributed.

Here is a quote from Winston Churchill’s speech, the same one from the article:

—-

“Some years ago in London there was a toll bar on a bridge across the Thames, and all the working people who lived on the south side of the river had to pay a daily toll of one penny for going and returning from their work. The spectacle of these poor people thus mulcted of so large a proportion of their earnings offended the public conscience, and agitation was set on foot, municipal authorities were roused, and at the cost of the taxpayers, the bridge was freed and the toll removed. All those people who used the bridge were saved sixpence a week, but within a very short time rents on the south side of the river were found to have risen about sixpence a week, or the amount of the toll which had been remitted!”

—-

This is why I strongly prefer the use of the term “Citizen’s Dividend.” If we all own the Earth, then let us be like shareholders and actually get the dividends. Since the point is to collect all the rent, regardless of what is necessary for government expenditure, then any surpluses should go to the people. This would provide incentive for small and efficient government, in order to maximize the dividend. Oh, and it would eliminate poverty.

Also, if you don’t think the land is enough to fund government, here is the estimated value of residential real estate, according to the Federal Reserve:

—-

“The Board of Governors of the Federal Reserve System Finance and Economics Discussion Series published “The Price and Quantity of Residential Land in the United States” 2004-37 by Davis, Morris A., and Jonathan Heathcote, later republished 2007 in the Journal of Monetary Economics 54, no. 8 (November): 2595-620. The earlier version concluded that residential land amassed a value (a stock) equal to the GDP (a flow) as of 2003 Q3 and that housing investment leads the price of residential land by three quarters. The 2007 version estimated the value of residences to be $24.1 trillion, or 1.43 times greater than the stock market. Using the building-replacement scheme, they still conclude land equals 46% of total property value. They also estimated farmland at a bit under one fifth of home sites.”

http://goo.gl/jLdfo

Next time any of you are in the Bay Area, give me a holler and we’ll chat about much, but chiefly LVT and the social philosophy that goes with it.

visit:  http://www.TheCommonsSF.org  and a cyber candidate for SF mayor:  http://www.LeonPhat.com

I came across the IEET via Edward Miller’s article. For nearly thirty years I have been building up a body of literature which explores the implications of introducing Henry George’s reform and also the consequences of ignoring them. I now call this list Ethical Economics since the work of Henry George and the classical economists before him has an ethical basis unlike modern
economics which regards itself as value free. We have a dedicated website for this list http://www.ethicaleconomics.org.uk.

I’m a little late to the party, but I can’t really see eye-to-eye with the poster who thinks it appropriate to quote Winston Churchill.  His speech is albeit a very important historical notion, however it does not tie-into our current state of affairs, sorry..

http://www.backonpoint.com

Well done, but where to implement first, the sea or Belize?

SLT (Single Land Tax, is what we used to call it back when) - has many interesting features and much worth exploring.  But its inherent weakness, as with all such economic schema is that it proposes that it solves all problems with a single stroke, is the answer to practically everything. Mr. Millers excellent introduction to the subject is no different, and like other Henry George literatures before it, suggest all will fall into place (environment, labor valuation, equitable wealth distribution, etc.) if only we ended land monopoly with a land value based tax.  I simply doesn’t happen that way and carries the same short view of things that the capitalist axiom of ‘trickle-down largess’ or the socialist axiom of ‘working-class wisdom’  does - vague illusions that evaporate in practice (or declare, “How can you know, we’ve never had our chance!”). 

In itself, LVT has much to commend.  But it was conceived at a time when the extent and complexity of the interdependent functions of lilfe (of which economy was only one subpart) were not as well understood. In its defense, such things as distinguishing between ‘real-valued’ and ‘market-valued’ holdings are solid observations that were much ahead of their time.  But it is also, despite promises of aiding other progressive agenda,  a form of laissez faire capitalism at least as subject to the abuses of corruption, power and wealth as we find ourselves mired in today.  Its potentials for aiding other agenda does not change that at all. 

Matters such as associating “taxes on improvements” as the sole or even principle cause of labor exploitation, are wildly short of the mark in practice. Indeed, from the employer’s point of view, wages are ‘taxes’ which it ever seeks to reduce to a bare minimum regardless of all other taxes that may be imposed upon it.  Relief from improvement taxes do nothing to improve that tendency - which derives from the ambition to maximize profit.

One of George’s greatest weaknesses (shared with other traditional economic proposals) is to concede their are only two players to be accounted for - the ‘state’ or ‘sovereign’, and the ‘owner’ or ‘producer’.  Government or private capital.  The actual member of society to whom all these schema are to be applied (presumably for their benefit) does not really appear in the calculus - is either relegated to the status of being an object (of government), or a dependent (of production).  Thinking outside of that box is prohibited by the universe in which George and other economic theories live.

Pan~‘s notion of land as a birthright ‘to have a place of personal shelter, a place to stand, is one interesting observation that suggests there is a fundamental difference between ‘land’ as a part of the engines of economy; and, ‘land’ as one of the essentials of personal survival.  This is not taken into account by Henry George. The worker remains an object beholden to secure the essentials of survival through his dependence on “productive employments” of land such that he earns wages and is thereby able to pay his “land tax”.  But it doesn’t take much thought to see that these two classes of land use are really quite distinct, and concessions to the one may impose severe exploitation on the other.

I think George and LVT has important application. But I think it more important to begin considering that the subpart of all economic universes, ‘the means of survival’ is really quite distinct from the ‘means of production’ and needs to be treated entirely separate and apart.  In addition to land as personal shelter, other essentials such as food, clothing, education, healthcare, information and transportation, in sufficient if modest amounts, are equally things which neither ‘state’ nor ‘private economies’ should be permitted to own or tax.  At best, the role of the state should more nearly be to insure and protect such essentials as the birthright of every member of a society.  Otherwise, what basis is there for a ‘social contract’ at all. If a society does not provide that much as its part of the bargain, why should one join it at all? LVT doesn’t solve such problems, and in some ways may tend to exaggerate them.

I’ve worked with this a little and have been able to come up with an imperfect model of an insulated and separate “means of survival” as a formal part of an economy. I’m guessing, if I can propose that much, others will be able to imagine even better models for a society in which poverty and welfare can disappear altogether, without being held hostage to the dominant general economic or political system of a society.

That proposal can be read at, https://www.facebook.com/note.php?note_id=162962670417237

“At best, the role of the state should more nearly be to insure and protect such essentials as the birthright of every member of a society”

I’m not sure the state should dictate essentials or directly provide them.

I’m not sure that the LVT proclaims to solve everything either.

@sean Henderson:  Sean,  Thanks for you comment.  I was being deliberate and careful when I used the phrase “at best”.  And I presume you draw some kind of line between ‘the state’ v. ‘private individuals’. The term you use,  ‘dicate’, is generally a red flag word used to indicate not only the source of authority in a matter, but to underscore its authority as compulsory or coercive.  I may be wrong, but I gather you fall a bit on the side of what is generally asserted as “choice” or “personal responsibility” theories of economics,  which you offer in opposition to “state” or “government” authority (as if they were the only options).

However, if you read my two closing paragraphs again, as well as the little screed I linked to,  you will see that I’ve suggest a third option might be possible; one that is neither the province of the state, acting as a government, nor private individuals acting as owners or managers.

I’ve separated out the subject of ‘survival’ and its economics and proposed the creation of a third preserve which belongs to neither of the principal players.  That one,  if you read my “National Service” proposal is created out of the voluntary ‘opt in’ consent of those who make an informed choice, in their adulthood, to belong to a society and accept its governing system as a part of an explicit and mutually agreed social contract. 

In that insulated part of a national economy, neither the state nor the private economy directly provide anything (with some important exceptions that must be negotiated between the state and the private economy).  In the main, that subpart of the economy is the sum total of each and every individual who agrees to the terms of the social contract. That is, it is result of both the choice of each and the totality of those choices (the membered community.)

Yes, there are significant difficulties in actually setting up and operating such a ‘insulated zone’.  And the formula for who and how things like definitions of ‘essentials for survival’ and ‘modest amounts’ get decided are subject to much debate and careful study.  However, I generally designate those matters as “administrative details”, not less important or problematic for that, but things to be assessed after general principles are agreed and accepted. What seems to be historically accurate is that, once principles are settled, a way can always be found to make those principles work - hence, “administrative details.”, things to be worked out.

On your final point - True, Miller doesn’t say LVT proclaims to solve “all problems” (and he does give some brief lip service to admitting that it does not solve everything) - but the overwhelming intertextual tone of his litany is one of LVT being the panacea for all people and all ideas (progressive, humanitarian, capitalist, progressive, blah, blah, this bunch of famous people or that…) is unmistakeable throughout the article. 

He spends a lot of words saying just that - how many diverse areas it relieves of their core issues and so forth.  I’m suggesting LVT not only doesn’t do that on close examination, but really applies to only one part of a very complex spread of issues - the dominant economy as a source of revenue for the dominant governing system.  Again, it pretty clearly offers relief from the fetters capitalism claims to be saddled with, but doesn’t really offer much relief for the ultimate reason for having an economic system in the first place - the flourishing of a society, all of it.  The LVT model remains the centerpiece of a society that primarily belongs to the “winners”; conscripts the “losers” to toil on its behalf, and sets the terms and conditions of that toil to its own advantage. 

In short, it really makes no difference whether the “landlord” is also the owner of a property or pays rent to a sovereign and continues to abuse their disproportionate power and wealth to define their own private, unaccountable view of a “flourishing society.”  That they can and do, under Henry George’s thesis as much as any other form of monolithic capitalism, remains firmly in place. It is still labor capitalism by any other name, and it still leaves the matter of who lives or dies, suffers or prospers up to the ambitions of an unaccountable few, to be adjusted to their own maximum benefit.

As I said, there are some good ideas in LVT, and they can have positive impact on other matters.  But that doesn’t make them any less dangerous in the wrong hands.  As with all forms capitalism,  when the “means of production” is the totality of the economic system, the wrong hands are always very close by.

This essay is an important contribution to the discussion of how to achieve real equality of opportunity in ours and any society.

I write to ask permission from the author to add the essay to the online library of materials at the School of Cooperative Individualism.

Yea, I actually release everything that I post on embraceunity.com as Creative Commons BY-SA.

http://creativecommons.org/licenses/by-sa/2.0/

red slider,

Thank you for taking the time to read my proposal, but I would just say that your grasp of the concept is flawed for two reasons. The first is that one can always opt-out of paying LVT by not acquiring a land title.

By leasing an apartment, you can avoid all the taxes. LVT cannot be passed on to tenants as specified by the Law of Rent

“A tax on rent would affect rent only; it would fall wholly on landlords, and could not be shifted to any class of consumers. The landlord could not raise his rent, because he would leave unaltered the difference between the produce obtained from the least productive land in cultivation, and that obtained from land of every quality.”

- David Ricardo, On the Principles of Political Economy and Taxation, Chapter 10


The second is that through a Citizen’s Dividend, it is quite possible for employment to become optional for all citizen’s under an LVT. A “basic income” funded by anything besides LVT would necessarily cause rents to rise, nullifying the vast majority of the expected benefits.

It is true, I am not advocating for a command economy, but any system which requires a centralized institution to snoop into every voluntary transaction is poorly conceived.

@Mr. Dodson - not sure if you were asking permission about reprinting Miller’s article, my notes here or my essay on ‘National Service”, or something else?  If it was addressed to me,  I suggest you go to my website, poems4change.org and email me from there.  We can discuss the matter further (please enclose the url of the site on which you would like to post my material, if that was the intent). 

@EmbraceUnity -  I wouldn’t bet on it.  The costs of land-taxes will always find a way to be passed on to the actual tenants, Laws of Rent or not. The fact is, the very need for such regulation underscores that someone (a ‘landord’ by any other name) will be permitted to hold someone else’s essentials of life (“means of survival”) in their keeping - do decide who gets it, and who does not, at what cost, and to what end.  In short, it only further exacerbates the problem of work-slavery and the ownership of people.  As long as the need to be beholden to someone else’s authority in order to survive exists,  the corruption based on the unequal distributions of wealth and a threat-based labor system remains.  Sleights-of-hand based upon terminologies that still support such pyramids of power don’t change a thing.

Moreover, if you actually look at the “Law of Rent’ it says nothing about leasing or subleasing tenants - it is only a theory about the value that accrues to the owner vis a vis improvements on the land.  If you consider that for a moment, it treats ‘subtenants’ (the landless who might live there and pay rent to the owner) as nothing more than ‘objects of improvement’).  Quaint and wishful thinking in 1879, perhaps. But won’t wash at all in today’s world. Sorry.

@Embraceunity - on your second point, “Citizens Dividend” - don’t bet on that either.  There are so many wrinkles and side-bars to that (who gets the dividend, in what portion, what prevents the argument - ‘only those who actually pay LVT are entitled to such dividents, etc. etc. ) that by the time you get to enforcement and distribution it will be a wonder if the landless aren’t expected to pay the entire dividend out of their own pockets, just for being “welfare recipients”!  Forget it. When the boat starts leaking in small places like those, its time to get another boat - a rising tide can’t save it.

redslider,

The entire concept of the Citizen’s Dividend is that it is apportioned equally to all citizens.

Your comments about the Law of Rent show no understanding of Political Economy. Have you thought about what rent is?

 

I suggest you stop using a patronizing tone in your remarks to me, Mr/Ms Embraceunity, or you will get no more discussion from me.

Fundamentally, I don’t believe ‘rent’ (for land) is something you’ve really thought much about.  If you had, then you know it is, at bedrock, the theory that everyone owes someone or something (a collective ‘someone’) for the right to stand on the earth (shelter, lay down, avoid exposure, conduct commerce, etc.).  That is true in all economic theory, not least with Henry George who assigns ‘rent’ to a sovereign that receives it in the form of taxes. 

That is ‘rent’, no frills, no word-games.  Now, think of what that means to a homeless person, or someone without the means (or who is dependent on some form of welfare/dividend apportionment - and therefore dependent on the ‘landlord’ or ‘sovereign’; it makes no difference to them) for the right to an essential of life - the right to stand somewhere on the planet.  Your fancy word-games really don’t mean much to them. Economic theory doesn’t change a thing about their plight; the accidental chance of having a generous and beneficent sovereign or a charitable landlord).

You seem to like to play games with “Political Economy”. Perhaps it is better you think about “not playing games” with peoples lives. The economic theory that might derive from that could astound you.

red slider et al.,

I come in peace.  😊

I will assume that everyone in this conversation certainly cares greatly about poverty and suffering. We all have valid perspectives, but we should not let our previous perspectives get in the way of understanding the perspective outlined in this article.Since we are talking about this article, I would say to red slider, with all due respect, that you should make an effort to just perceive what it is being said before jumping to conclusions.

I really don’t mean to be patronizing, but hear me out.  I think your views are in principle valid. Also, your difference of opinion is likely not a difference of principle, the principle that poverty is insufferable, and there is a great need to make systemic changes. However, there is a key point you are not aware of with respect to the Law of Rent.

You said “...it [the Law of Rent] is only a theory about the value that accrues to the owner vis a vis improvements on the land.” This is not what the Law of Rent deals with. The Law of Rent describes the rent of land, which is by definition income that accrues to the land owner above their opportunity cost. In other words, it is unearned income on land, income that accrues through no productive effort of the landlord. This is not income/ increased “value” from improvements, but from the increases in land value that the landlord keeps for themselves. It is truly the opposite of value that accrues from improvements; it is all the landlord’s income that comes from everything but improvements and other productive activity.

Let’s restart the discussion with a correct understanding of that critical point in mind.

Jake,

You were mostly right. But it is not quite over and above their opportunity cost, that would just be economic profit.

It is over and above the wages attainable at the margin of production.

Jacob - I’m sorry for the confusion, and I would have gone back and edited that sentence if we had an edit option. There are two sense in this those lines can be taken. The first is, as you say, ‘improvements’ being used for public revenues; and that would be exactly the opposite of what Henry George and LVT proposes - that ‘improvements’ are not to be the source of public revenues - hence a single land tax.  But the other sense, the one which I intended was that ‘improvements’ are ultimately the source of those revenues for which the land-tax is payed; i.e. that is source of wages paid to labor, profits made by owners, markets selling goods - their incomes and wealth come from those “untaxed” improvements, under Henry George.  Those ‘improvement’ revenues are then used to write checks to the government which it may then spend as public revenues.

So, that was the sense in which I was using ‘improvements’. It is where the pockets meet the demand for money - whether it be levied from a calculus of land value, or from the traditional ones of profit and income.  To the poor, it is still a pocket into which they must reach and for which they must deliver the goods or be left homeless, hungry, and deprived.  As I understand it, no one under LVT gets to put a handful of dirt in an envelope and send it to the state as payment of their land tax (If, that is, they have any land).

Sorry for the confusion. - red

My final post here (ahhh.) on the matter is that if anyone cares to slug it out in detail, they are welcome to do so by email (I provided the link in an earlier post) though my responses may be slower. Other than that, I studied Henry George rather intensively with a number of economists and others about 40 years ago. The conclusion, at that time, was that single land-tax was a thinly disguised form of removing even the modest constraints that were put on capitalism (back then) and of permitting it to run amuck. As we can all see, that’s pretty much what what capitalism has done anyway, but George would not have prevented that. Perhaps a slightly greater fraction of what is due and fair from our corporations might be collected, owing to the more direct way of observing and calculating what is owed.  But not by much. And a little more than zero is certainly not enough.  No doubt, our commercial enterprises would deal with LVT by finding more ways to amass wealth and power just as they have, perhaps by building their mile high skyscrapers on marginal land, paying little in taxes for very minimal parcels and having at it; or, stuffing themselves in yet-another-postal-box in the Cayman Is. that uses no U.S. land at all.  Life was simpler before 1886;  even business was less ruthless.

bottom line - it ain’t gonna happen any more than my ‘National Service Proposal’ - so I need to move on.  Some of you may wish to take a look at October2011.org .  Some may not. My best to all.

To red slider, the forecast of what would transpire under a system of public revenue based on the proposals of Henry George ignores the benefits that occur by the removal of monopoly privilege (of which the private appropriation of rents is one form). Our economic system cannot accurately be referred to as “capitalism” because only a small portion of the population earn income from the use of capital goods. There are some who embrace Henry George’s proposal who have great faith in markets when markets are truly competitive. I share this faith to a high degree but not without societal constraints and the effective enforcement of rules established under transparent and democratic processes.

@ Redliner

The bold is not intended to be aggressive. I just want to point out to you what the law of rent says and why the tax/collection would NOT BE PASSED ON TO TENANTS.

The Law of Rent states that the rent of a land site is equal to the economic advantage obtained by using the site in its most productive use, relative to the advantage obtained by using marginal (i.e., the best rent-free) land for the same purpose, given the same inputs of labor and capital[2]

This law has a number of important implications, perhaps the most important being its implication for wages. The Law of Rent implies that wages bear no systematic relationship to the productivity of labor, and are instead determined solely by its productivity on marginal land[3], as all production in excess of that amount will be appropriated by landowners in rent. This is not the notorious iron law of wages, which predated Ricardo and is most commonly associated with the writings of Thomas Malthus. Indeed, the Law of Rent explains why the Iron Law of Wages consistently fails to predict actual wages: if there are highly productive land sites available for free, wages will tend to be high, all things else being the same; if the only available free land yields little, wages will tend to be lower.

The Law of Rent makes it clear that the landowner has no role in setting land rents: he simply appropriates the additional production his more advantageous site makes possible, compared to marginal sites. The Law also implies that the landowner CANNOT PASS ON THE BURDEN OF ANY COST SUCH AS LAND VALUES TO HIS TENANTS, as long as such costs do not affect the relative productivity of his land and marginal land.

Jacob, would you mind clarifying two matters for me?

Under LVT (or whatever you wish to call it):

1.  If someone owns a piece of land (pays LVT on that land) and they build an improvement consisting of a building with apartments, who exactly sets the fee tenants who live there, but do not own the land, will be charged?

2.  If someone owns land and builds a factory on that land; who exactly gets to decide what wages they will pay those who work in that factory?

Skip all the detail, if you will, on relative market values and so forth. I’m only interested in who actually gets to decide what fees for non-owning tenancy and non-owning wages will be?

I have written a response, but it did not post. Excuse me for the delay.

Since a huge amount of land would not be speculatively held anymore, because of LVT, there would be alternative land (land would become more elastic in supply), and the market would determine what would be paid for land use. It would be a fair compromise between the landlord and the tenant. 

If you like directness and common parlance, I have written an article on this subject that you would find interesting. It’s got the same ideas, but it’s for a more general audience. http://www.shwartzlucas.com/?page_id=54

Maybe someone could direct me to a place to read more about the LVT but how on earth could this be put into place in a practical manner?  How much of a tax are we talking about?  Is it based on square footage?  Cubic feet? 

Wouldn’t that provide more incentive for people to build “up” rather than out?  Wouldn’t that also force centralization of property ownership ie, denser city populations which could potentially cause higher security risks?  I would think people would leave rural or suburban areas in favor of living in the city because of tax incentives… 

How would you calculate a LVT to bring in at least an equivalent level of federal income especially considering the potentiality of a flooded real estate market and value crash if a LVT was passed?  Wouldn’t this also dramatically reduce the taxable population which would in effect put a very large burden on very few people?  So many questions… But this is the first time I’ve read about an LVT.  😊  Thanks to anyone willing to stab at my questions or direct me somewhere for further reading.

Hi Matt, read this: http://www.shwartzlucas.com/?page_id=54

It addresses your questions simply.

We do still exist in a conscious environment of duality. Still it is sad to see dissension here.

While Georgist thinking is not itself new, it is new to many. They don’t teach it in most business schools and few who have studied economics are aware of it, which is tremendously sad to me.

Edward Miller has done an excellent job in this article of presenting Georgist concepts in a palatable way.

I was recently informed there is danger in examination of new teachings from the perspective of old knowledge. 

We are all conditioned by old knowledge, but as we become AWARE of our conditioning, we are able to take action.  Krishnamurti agreed, “When one gives total attention to conditioning you will be FREE from the past completely, naturally.”  In other words, awareness will set you free.

Try reading this article and looking at life and the opinions of others, first with an eye to the similarities. That is, the things with which you agree. This paves the way to later, when your heart, not your mind, but your heart-mind, can come in and do some critical analysis, ending up discerning (a much higher form of analysis than judging) the value of whatever concept or person’s opinions you may be exploring.

I personally believe this is one of the first and most important steps each of us can take in the process of shifting from the old way of thinking to retraining our minds and embracing consciousness of the Oneness of us all.

To the vast majority of us, Georgist thinking and the wisdom of James Quilligan are foreign terrain. Those who have an acquaintance with these rich and humane concepts have a huge job ahead of them.

Thank you, Edward Miller, for doing such an excellent job in expressing the tenor and beauty of The Commons, which provides all of us an opportunity to embrace an economic system based in the most important rule on earth, “doing unto others as we would have them do unto us.”

Georgist thinking is grounded in this rule and graces our consciousnesses with an opportunity to expand and take another step toward the return of common decency to Earth. I love this article!

Jacob,

Thank you so much for the reference!  However, it still did not provide real world numbers or how much of a tax would have to be levied in order to, at minimum, meet the current federal income if not exceed it slightly.

Until someone comes out with workable numbers to show at least an estimate of how much an LVT would be and the potential consequences of it, I’m afraid it will remain in the shadows of potential “fixes” to the current crisis.  Don’t get me wrong, I think it’s a great idea!  But every idea and every tax has consequences, intended or not.  The income tax is a scam, a consumption tax dampens the very thing we want people to do (consume), and imo a capital gains tax is disincentive for people to invest (at least it is for me…). 

I like the LVT because it takes land ownership out of the “most coveted” and “most important” investment classes but doing so would presumably result in an extremely sharp drop in property values when the market floods with property for sale.  People who have all their money invested in “the most secure” investment will lose their shorts.  Wouldn’t this mean there’s less value to tax??  Then when everyone freaks out that their property values drop like a rock, the LVT gets removed and whoever bought in on the land sale would be made extremely wealthy when suddenly everyone’s trying to buy land again.  So in a sense, the LVT *relies* on land remaining speculative but removes it from that pedestal which imho makes no practical sense.  This could all be me misunderstanding the method of taxation though.  😊

Matt,

Land prices would indeed drop as a result of the Land Value Tax, but the values themselves would not drop (and actually over time they would grow quicker than otherwise).

The new lower prices for land would have LVT built into the price, so it would already be factored in. The valuable-ness of the land wouldn’t change, just the selling price.

Since the thing which makes some locations more valuable than others is their natural features and all the local businesses, schools, roads, cops, etc etc… yet, the person being paid land rent to is responsible for none of that, so we are essentially subsidizing landholders who in their capacity as landholders are providing no service… yet we are *also* paying taxes to fund all the roads, schools, and the like.

Every time you tax land, you eliminate that subsidy to landlords, and eliminate the need for income taxes and the like. So really, it sharply reduces the burden of everyone who does not derive the majority of their revenue from that unjust privilege.

You are correct that many people have a good portion of their savings bound up with land, and perhaps that is an argument for a gradual transition or some temporary exemptions.

However, if we agree that the current land system an injustice then the only difference between those people and slaveholders is one of degree. Many good people, Thomas Jefferson included, had their wealth bound up in slavery, but slavery had to go. Simple as that.

Thank you for that clarification!  😊

What is the calculation difference between a land’s price and a land’s value?  Isn’t a land’s price a reflection of… how productive it is?  You buy a business for how much income it should bring in over the next 3-5 years… is that what the LVT would pull from only from land’s future rentable value?  Or the price increase in land over the following years?  Isn’t that… speculative? haha

I recognize the injustice inherent in the current system, but it appears that an LVT would almost exacerbate the problem further!  And then when land values drop, the government would have to increase the tax to maintain revenues which could compound the issue upon itself!  Eek! On the upside, people would necessarily invest their money in banks and stocks rather than land in order to grow it tax free (which would theoretically boost lending, and business of all nature).

Btw, what about other tangibles that increase in value, like gold?  Why aren’t we issuing tax forms with all gold purchases and levying a tax on any value increases when it’s sold?  People didn’t work to make the price of gold go up…  Why isn’t this principle applied across the board?  If we just levied a tax on all non production gains, wouldn’t we be able to take a smaller portion of each commodity to fill the government coffers rather than demolishing all profit in land alone?

I feel my questions are rooted in a misunderstanding of the method of taxation itself rather than a misunderstanding of why it’s needed though so respectfully, I think it’s time for me to shut up and look elsewhere for my answers.  Thank you for your time!

Matt,

> “Isn’t a land’s price a reflection of… how productive it is? You buy a business for how much income it should bring in over the next 3-5 years… is that what the LVT would pull from only from land’s future rentable value?”

Close. The rental value of the land vs the selling price of the land varies based on the interest rate. If the interest rate is 5%, then you can expect the annual rental value to be around 1/20th of the selling price.

It is all based on the potential productivity of the land, that part is correct.

> “when land values drop, the government would have to increase the tax to maintain revenues which could compound the issue upon itself!”

No, the selling prices drop, the land values remain the same… they just go to the community rather than the individuals. The community becomes the landlord, and collects the rent instead of taxing productive activity.

Thus, the land value is always there, it is just transferred to the community, and the selling price to individuals drops dramatically since there is little speculative gains from holding land itself.

> “On the upside, people would necessarily invest their money in banks and stocks rather than land in order to grow it tax free (which would theoretically boost lending, and business of all nature). “

Precisely. That is one reason why land values would indirectly increase over time, as a result of increased productivity. Yet, the land values are not directly affected.

> “Btw, what about other tangibles that increase in value, like gold? Why aren’t we issuing tax forms with all gold purchases and levying a tax on any value increases when it’s sold?”

Gold comes from the land, and land values, if properly assessed, ought to include the natural features of the property… including if any gold deposits exist. That would raise the assessed value and thereby raise the land value tax.

Gold that has already been extracted without any LVT has evaded that, unfortunately. Pragmatism is our only guide for dealing with those past abuses.


> “Why isn’t this principle applied across the board? If we just levied a tax on all non production gains, wouldn’t we be able to take a smaller portion of each commodity to fill the government coffers rather than demolishing all profit in land alone?”

It ought to be applied across the board, and I think most georgists would agree. There is a common saying, “tax bads, not goods,” and georgists generally agree with that. Though, LVT can be supported for all manner of reasons. Just like all sorts of struggles, be it civil rights or whatever, it is best to pick your battles and build the broadest possible coalitions.

My article attempted to show why land is the mother of all privilege, and must be attacked first, before other attacks on unearned privilege can make a dent.

Well Mr. Miller, I genuinely must thank you for enlightening me on this prospective solution.  I had no idea this was even out there and I feel like I’ve been struggling to figure out what would be fair for everyone for a long time!  The income tax is so extremely flawed.  The consumption tax inhibits people from doing what we want them to do (spend money!!).  And I could not for the life of me come up with a fair way to tax both the rich and middle class proportionately.  So again, from the bottom of my heart, thank you for this article as I feel it gave me a new road to trek down.

Something I feel would greatly improve the potential success of this idea would be a reform in education.  We need to be teaching kids from a young age not just to save, but to invest and have their money work for them.  I don’t know about you, but I did not learn any sort of financial literacy in high school.  Had I known better, I wouldn’t have saddled myself with thousands and thousands of dollars in student loans.  Had i known better, at a younger age, I could have invested earnings long ago and contributed to market growth.  Too many kids get out of school and spend all of their money on worthless crap because they don’t know any better and that’s what our role models on MTV do.  haha If I had known better, the $450 a month I’ve paid to student debt for the past three years could have been $20,400 in growing money by now.  Instead, it’s gone and I have barely made a dent in my debt. 

Anyways, thank you again for this article.  It’s not just a tax-code change that’s necessary though… It’s a mindset change.  The good news is there’s hope and if we act appropriately, we can create long lasting, sustainable growth for generations to come.

Wonderful to hear. I suggest you check out the work of Fred Harrison. He would probably be right up your alley.

http://amzn.com/0856832413

http://amzn.com/0856832731

Interesting that some of questioners on LVT come fro NM the land of NON-transparent real estate assessments and incredibly low taxes not keyed to value in the least?

Let us stamp out CORPORATE GREED and unfair stock trading.  Urge Congress to pass THE SHAREHOLDER EQUALITY ACT.  The law shall read as follows:  If Joe Average buys 1 share of Company X stock and Warren Buffett buys 1 share of Company X stock, then EVERY term and condition of those 2 shares SHALL be IDENTICAL.  No exceptions!  That plain, that simple!!!  Show your support and get your buttons today at http://www.cafepress.com/thedirtycloset.546802414 

LET EVERYONE KNOW WHAT YOU STAND FOR AND AGAINST!

There are such good comments and thoughts shared on this site - hey, Pellisier, the Quakers and the Syrian Christians most closely align with what J the Nazarene was really about…what he is still really about, as he guides so many of us here and now.

Wendell Fitzgerald, James Quilligan, Alanna Hartzok and others are scholars in the field of the new economics. Quilligan professes that the righteous indignation of the people will propel needed change - the activities on Wall Street bespeak the wisdom of his words. No violence though! Violence woulf dispell all the good being accomplished!

Alanna HArtzok will be our president some day in the future - another time, another generation, but what she shares here and now is to be honored!

Wendell Fitzgerald is the heart and soul all rolled into one of what Georgist thinking is about….

I like the idea of every person coming of age having land given to them, but the truth is that NO ONE owns the land… it is all of ours…. better to rent land via taxes on its use and be reimbursed for its improvements, be penalized for abuses to the land, water, air, resources. Keep everything sustainable and everything will keep us sustained!

And so it is and will be…

@pan~ 

I know I’ve been pegged as a harsh critic of George, & dismissed for the same reason, though I’m not really unsympathetic with his thesis. I simply feel that it doesn’t translate very well into what we know of 21st century processes and needs would require severe modification to do what its enthusiasts claim.

In any case, your brief focus on starting people off with something - a ‘grubstake’ in life is what I call it - caught my attention and I thought you might be interested in these two papers; and, perhaps, sharing a few ideas (I suspect you have a number of them on your table, as I do on mine).  These are merely ‘thought-experiments’ (rough and not too practical as they are) but perhaps provocative, nevertheless.  If you want to share ideas further, you are welcome to email me (link is at http://www.poems4change.org):


‘National Service Proposal’  -  Ending Poverty and Welfare with a Single Mechanism’
https://www.facebook.com/note.php?note_id=162962670417237

‘The 100% Death Tax’  - Towards An Equitable Distribution of Wealth
https://www.facebook.com/note.php?note_id=219704654743038

for every reform there are unintended consequences… giving land to every person will encourage breeders and discourage zero population growth ... if land is not farmed or used for an industry to support the owner, if it is not natural habitat for all life, how will we prevent abuse of the land?  perhaps we can learn some lessons from Cuba as Cubans have transitioned to rooftop organic gardening away from fossil fuel based agriculture .... poverty is not the lack of spending money, it is the isolation away from resources to sustain life, denied education, healthcare and protection from harsh environment called housing

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