We are Hanno Beck, Lindy Davies, Fred Foldvary, Mike O'Mara, Jeff Smith, and assorted volunteers, all dedicated to bringing you the news and views that make a difference in our species struggle to win justice, prosperity, and eco-librium.
A 2014 excerpt of the Financial Express (of Bangladesh), Mar 23.
1.0pc of people engaged in rent-seeking, control politics, BEA’s public lecture told
President of Bangladesh Economic Association (BEA) Abul Barkat said that Bangladesh is caught in the middle of poverty, inequality, and disparity due to an unholy alliance of one per cent people who are engaged in rent-seeking.
“This one per cent people controls politics, power, and all state machineries and gather wealth by not creating assets but taking away from the existing amount of wealth through embezzlement, misappropriation, lobbying, and many other improper means,” he said while presenting a public lecture at Dhaka University.
The Vice-Chancellor of Dhaka University Prof Dr Arefin Siddique said equal partnership of male and female can help a lot to remove disparities from the society.
Ed. Notes: You could be anywhere in the world and one thing would be the same: the few who are first to amass an extra bit of money use that to influence legislation in their favor. Those state favors make them more wealthy still and with the extra money from the favors they win still more favorable laws and rulings, round and round, until they become a nigh untouchable elite. So what do the rest of us do? We acknowledge the common wealth and demand our fair share. Winning our fair share will kick the underpinnings out from under the, now former, ruling elite.
This 2014 excerpt of Guardian Liberty Voice, Apr 12, is by Michael Cantrell.
As radical as it may sound, taxes are legalized theft that violates the right of property.
After a person trades their most precious commodity, that of time, to an employer in exchange for dollars, the money belongs to that individual and unless the person decides to give or exchange that money for products or services that improve the quality of life, no one has the right to deprive them of it. Yet this is exactly what government does, even deducting taxes before an employee receives their paycheck.
The government exists to serve the people and protect their rights and freedoms. All of the powers the government possesses are supposed to be from the consent of the governed. What if people today have not consented to a particular law or power granted to the government in generations past? Should that activity continue to be legal? More importantly, what gives the state the right to forcibly take someone’s property and give it to someone else? Are regular citizens allowed to participate in such an activity? If someone were to hold a neighbor at gun point, steal their property, and give it away, would that not be frowned upon in modern society?
While many attempt to justify taxation by stating that the money goes to programs to help the poor, forced charity is not charity at all. And while people living in poverty is a horrible reality, high taxes on business owners destroy jobs.
Government uses threats of imprisonment and other harsh consequences to force their hand into the pockets of the people and take their property. Why do people put up with it?
Ed. Notes: “Taxes are the price we pay for civilization,” you hear said by those who get to live off others paying taxes. But what’s so civilized about war and corporate bailouts? Could ending taxes end such bad behavior?
Of course governments do some decent things. But could they fund, say, police protection with membership dues? And fund roads by charging user fees (attached to the price of fuel)? And must government provide parks or could groups like the Nature Conservancy?
Taxes, and their mirror opposite — subsidies — have inherent flaws that come with the territory:
1) they distort price,
2) they require expensive bureaucracy,
3) they overly empower the recipients, and
4) they demean the payor.
Fortunately, however evil they may be, taxes are not necessary. Whenever society as a whole wants to take a collective action that needs funding, it can charge a fee — like a gas “tax” (a fee for polluting the air) — or require dues — like a land “tax” (owed by owners for displacing every other member of society from the site one claims).
So, yes, do feel abused when taxed, but take it one step further and replace them with charges that adhere to the justice of quid pro quo.
This 2014 excerpt of the Financial Times, Mar 23, is a review by Martin Sandbu of Fragile by Design: The Political Origins of Banking Crises and Scarce Credit, by Charles Calomiris and Stephen Haber.
In Fragile by Design, Charles Calomiris and Stephen Haber, say that one reason conventional economists did not see the financial crisis coming is that their models are free of politics.
This sweeping account of how banking and politics have always been intertwined spans three centuries and five countries: the UK, the US, Canada, Mexico, and Brazil.
Governments typically need banks when they are running out of money (historically, usually when they were fighting wars) and are forced to bargain with private financiers. These financiers obtain concessions in return for funding a bank to channel credit to the government: in the last US bubble, they consisted of allowing megabank mergers. Banking develops as a rent-seeking racket where the politically powerful divide with bankers the spoils extracted from those outside of this political “coalition”.
The 1930s reforms in the US — the New Deal’s adoption of deposit insurance, mortgage guarantees, and the Glass-Steagall act that split commercial and investment banking — are usually taken to have transformed banking. Haber and Calomiris instead see continuity.
They argue that the old, inefficient system was stable only while low inflation prevailed. As price rises gathered speed from the late 1960s on, a legal ceiling on deposit rates encouraged savers to opt for money market funds, undermining the funding of depositary unit banks.
Ed. Notes: Economists shy away from politics because the powerful, who get their riches from ownership, can make life difficult for anyone who wants to study who does the work and who gets the rewards in a rigorous, scientific way. The whole raison d’etre of government throughout history has been to funnel wealth from workers to owners. Indeed, up until relatively recently, landowners were the government, and still are indirectly (more direct in England where they still have a House of [Land]Lords). The few researchers who did study ownership and receivership of rents objectively had no trouble at all predicting the last recession. Our own Fred Foldvary gave a reliable forecast in these pages and even before that he did an academic journal. England’s Harrison and Australia’s Anderson also went out on a limb and were far more accurate than ones who get all the press. If only the Financial Times would write about them!
Our current targeted welfare system is no way to build a society which claims to value intimacy, honesty. and strong families.
The New Economics Party wanted an unconditional Citizens Dividend for all individuals that was not means tested, asset tested, or work tested. The benefits of the commons — land and the natural resources — should be shared equally.
New Zealand had three precedents for unconditional payouts.
In 1948 every household was given a dividend because we had a particularly good wool cheque that year.
The second was the Universal Family Benefit that existed from 1946 to 1991 when family support became targeted.
The third was in 1977 when the unconditional National superannuation was paid to all over 65 without asset or income testing.
Ed. Notes: Big changes come more easily from small countries. In a small country, it’s easier for the citizens to have a conversation. It’s also easier for a citizen to identify with their territory, the nature, the resources, and the economic value of the land. Perhaps New Zealand could lead the world!
This 2014 excerpt of Share The World’s Resources in London, Mar 21, is by Rajesh Makwana, their director.
There is a growing movement of people calling for a proportion of revenues from the use of land and natural resources to be shared among citizens. And countless campaigns for tax justice, an end to austerity, and the strengthening of social welfare are all predicated on the notion of sharing national resources more equitably.
This does not mean abandoning the goals of existing initiatives, but rather supporting the emergence of a common platform for change that can be explicated in the simplest terms and embraced by the greatest number of people.
With support for the principle of sharing rapidly growing across the globe, a united call for sharing the earth’s resources could ultimately hold the key to safeguarding human progress in the 21st Century.
Ed. Notes: Sharing our surplus is key. The revenue to be made from land and resources is a surplus because our spending for these gifts of nature does not reward anybody’s efforts since none of us made the ground or stuck oil and ores in it. We must pay for the useful parts of nature as a civilized way to allocate them. But pay to whom? While none of us made Earth all of us need her and all of us, via our needs and demands, generate the value of her.
Not only is such sharing needed and fair, it also makes possible a total reform of public revenue. With land dues, we could get rid of noxious taxes on our efforts, on our wages and purchases and buildings. With these “rent” shares, we could get rid of subsidies which mainly benefit insiders (corporate welfare).
Sharing Earth’s worth does not have to be justified by that fact that it’d help the poor, or spare the environment, or make life much more pleasant for all, because it’s already the moral thing to do.
This 2014 excerpt of the New York Times, Mar 20, is by David Gelles.
Robert D. Marcus became chief executive of Time Warner Cable at the start of the year. Less than two months later, he agreed to sell the company to its largest rival, Comcast, for $45 billion.
For that, he will receive nearly $80 million, once the FCC approves. That’s more than $1 million a day for six weeks.
The extraordinarily large exit package is another instance of corporate America rewarding executives with outsize sums for minimal amounts of work — and an example of income inequality in America.
Marcus’ payout will not be close to the largest golden parachutes of all time.
John Welch got from General Electric in 2001 more than $417 million.
Lee R. Raymond got from Exxon Mobil in 2005 $321 million.
William McGuire got from UnitedHealth Group in 2006 $286 million.
Dozens of executives got more than $150 million.
But Welch, Raymond, and McGuire had been at their companies for years. Marcus, 48, for such a short period.
Executives can receive golden parachutes not only when they sell their companies, but also when they retire, and even when they are fired.
Time Warner Cable shareholders can express their displeasure with the package when they vote on the deal. But it will not change a thing. Such votes are nonbinding.
Mr. Marcus will not be the only Time Warner Cable executive in line for a big payday. Arthur T. Minson Jr., the chief financial officer, will receive severance pay of $27 million. Michael L. LaJoie, the chief technology officer, will receive $16.3 million. And Philip G. Meeks, the chief operating officer, will take home $11.7 million.
Ed. Notes: Why is this not theft? Management did not earn those millions that they take from the company. The money belongs to shareholders.
Government needs to break from Big Business and side with the public and write laws that would lead to executives getting arrested and serving time when they steal via paying themselves from their companies.
Also, such fat payouts prove that government, were it truly in the people’s corner, could negotiate far higher “rent” payments for letting tele-comms use the airwaves or enjoy other monopolies in various regions. Government could use the revenue from granting such privileges to pay dividends to citizens, since corporations are not paying fair dividends to shareholders.
This excerpt of The Real News Network, Mar 22, is an interview by Essica Desvarieus of professors Jeffrey Sommers and Michael Hudson.
Essica Desvarieus: The IMF is lending the interim government in Ukraine a $15 billion IMF bailout package. The conditions include cuts to gas subsidies, pensions, public sector employment, as well as privatization of government assets.
Hudson: The UN and the World Bank put Ukraine next to Nigeria for the GINI coefficient of concentrated income. The Europeans have told the kleptocrats that run the country, we will give you a lot of IMF money, you transfer it into your banks and your bank accounts, you send it abroad to your offshore banking centers, and the Ukrainian people will owe it; you tax your people and make them pay.
Russia says that Ukraine owes $20 billion, dating back to the Soviet Union era in exchange for, in addition, to about $5 billion or $6 billion for the oil subsidies that it’s been given. Russia said it is going to charge Ukraine the normal oil price, not the subsidized price. So all the money that the IMF and the U.S. gives Russia says is immediately owed to it itself.
None of the money none of this money’s going to go to the Ukrainian economy any more than the IMF money went to the Irish economy or the Greek economy. It goes to the billionaires who run the countries and immediately send it back to the West so it’s a circular flow. It goes in and out of Ukraine in about 20 minutes.
The government has to pay the IMF loan by privatizing whatever remains in the public domain. The Westerners want to buy Ukrainian farmland. They want to buy the public utilities. They want to buy the roads. They want to buy the ports. And all of this is going to be sold at a very low price to the Westerners. It will pass into foreign ownership, just like it did in Russia and Latvia.
Many Ukrainians say they haven’t been paid for two months. In Russia in 1994, during the Yeltsin selloff, labor went ten or 12 months without being paid. You can’t pay labor and at the same time pay the IMF and pay the kleptocrats.
In Latvia, Greece, and Ireland, 20 percent of the population emigrated. Just like 20 years ago you had an influx of Polish plumbers into London, you’re now going to have millions of Ukrainian plumbers pouring into Western Europe.
Russia moved in to Sevastopol for military reasons. It couldn’t let NATO put hydrogen bombs 20 miles from Russia, because then somebody in the neocons would have said, hey, we’ll never have a better chance to blow up Russia than we have right now; let’s do it. So Russia’s decisions here are cultural and military.
Western Europe is drying up. Russia’s turning towards an economy that’s not destroying itself, towards China and other Asian economies. We’re seeing a vast shift.
Also there’s the Budapest Memorandum of 1994 that bans all foreign countries from interfering in the domestic politics of Ukraine. Russia pointed out that it was the West that had violated the Budapest memorandum; the U.S. and E.U. stated they no longer regard the legally elected head of state as a legitimate partner, unlike the new leaders appointed in the square.
Sommers: The Soviets felt that they were given assurances from the United States that NATO would not encroach upon the former Warsaw Pact nations. What does the United States do over the past two decades? They take in the Warsaw Pact, and then they move even into the former Soviet Republics themselves, the Baltic states, moving towards Georgia, and now tentatively towards Ukraine.
Ed. Notes: You see why you shouldn’t let politicians spend your money? Why you shouldn’t let bankers concentrate your savings and create your currency? Why you shouldn’t let your militaries try to “solve” problems much more complex than meets the eye while merely enriching military contractors? And why, most importantly, you should work for geonomics to create a model of economic justice that would spread worldwide?
This 2014 excerpt of TripleCrisis – global perspectives on finance, development, and environment – Mar 18, is by James K. Boyce.
Rent isn’t just the monthly check that tenants write to landlords. Economists use the term “rent seeking” to mean “using political and economic power to get a larger share of the national pie, rather than to grow the national pie.”
Two other types of rent originate in nature rather than in human investment. Extractive rent comes from nature as a source of raw materials. The difference between the selling price of crude oil and the cost of pumping it from the ground is an example.
Protective rent comes from nature as a sink for our wastes. In the northeastern states of the U.S., for example, the Regional Greenhouse Gas Initiative requires power plants to buy carbon permits at quarterly auctions. In this way, power companies pay rent to park CO2 emissions in the atmosphere. Similarly, green taxes on pollution now account for more than 5% of government revenue in a number of European countries. When polluters pay rent to use nature’s sinks, they use them less than when they’re free.
The current value of the world’s oil, coal, and natural gas reserves is estimated at $27 trillion. Much of this will have to be written off if we phase out fossil fuels. Fossil fuel corporations have shown themselves willing to fight hard to defend extractive rent.
Who should get protective rent? One possibility is to return it to the people via equal per capita dividends. Another option is to let the government keep the money, as in the case of Europe’s green taxes.
Dividends are based on the principle that the gifts of nature belong to everyone equally. Cap-and-giveaway is based on the premise that the same corporations that profit from extracting nature’s wealth ought to be paid to leave it in the ground.
The only way we’ll see a switch from extractive rents for corporations to protective rents for the public will be if ordinary people join together to make this happen. To change the rent we get from nature, we must change who gets it.
Ed. Notes: Of course people should pay for polluting, which would encourage them to find clean alternative fuels. But it’d also be a good idea to quit paying corporate welfare to polluters. And to de-tax wages and investments to facilitate tech-progress to clean fuels and engines.
Another crucial part of the puzzle is to charge people for merely occupying land; doing that would encourage owners to use land efficiently. In cities, they’d develop vacant lots, parking lots, abandoned buildings, and under-sized buildings — they’d infill. Compact metro regions have buildings side by side and shorter trip distances so they both consume fewer resources and emit fewer pollutants.
Cutting demand for fuel weakens the grip of oil companies while charging landowners is something localities can do; without waiting for federal action, cities and counties can shift their property tax off buildings, onto locations, and that would trigger the cascade of benefits for both people and planet. As does Aspen CO and Singapore, they could even generate a surplus and pay residents a dividend — way cool.
A growing number of American children are developing infections caused by antibiotic-resistant bacteria.
While still rare, the bacteria are being found more often in children of all ages, especially those who are 1 to 5 years old.
The prevalence of resistant-enzyme(ESBL)-producing bacteria rose from 0.28 percent in 1999 to 0.92 percent in 2011. Resistance to third-generation cephalosporins climbed from 1.4 percent to 3 percent.
ESBL-producing bacteria were found in children of all ages nationwide, but slightly more than half were found in youngsters 1 to 5 years old. About 74 percent of these bacteria were resistant to many types of antibiotics.
These antibiotic-resistant bacteria have traditionally been found in health care settings but are increasingly being found in the community, in people who have not had a significant history of health care exposure.
Ed. Notes: Is our “arms race” against single-cell life forms a battle humans can win? Or should we try to improve our immune systems in other ways, such as improving our medical system?
People catch most of these bugs in hospitals, which may soon see more patients as government tries to lower the costs that hospitals now charge patients. Perhaps government should instead make hospitals less needed and help people lead healthy lives.
Government could combat pollution and distribute the common wealth — the value of land and resources — two actions that’d take the stress out of our lives so we could feel and live healthier. To lower medical costs, government could permit more qualified competition. And to raise the bar for safety at hospitals, government could hold the doctors there liable.
This 2014 excerpt of ZMEscience, Mar 19, is by Mihai Andrei.
If you look at the global annual earnings of all time for all companies, the top 5 spots are all occupied by Exxon Mobil – the world’s largest private company. In 2008, they made $45.22 billion. More recently, in 2011 they made $41 billion. In the same year, Shell made over $31 billion. Chevron made almost $27 billion. So why in the world are these companies being subsidized?
Ed. Notes: For the above to ever happen, you have to get everyone you know to demand such a sensible policy. Of course, it might be more sensible to not let politicians invest in alternative energy and simply to de-tax it. But one must compromise in politics.
The German government has told European Union officials that it will try to block the inclusion of an investor-to-state dispute settlement (ISDS) clause in the proposed Transatlantic Trade and Investment Partnership (TTIP).
An ISDS clause is an arbitration mechanism which would allow private investors to sue governments if they believed that local laws were threatening their investments.
The proposal has won backing from businesses but has faced opposition from consumer and environmental groups who claim it could allow investors to challenge broader government policies – such as the ban on fracking currently in place in France.
From the perspective of the [German] federal government, US investors in the EU have sufficient legal protection in the national courts.
ISDS provisions have been common in trade agreements since the 1960s.
Ed. Notes: If German businesses don’t push for overruling local laws, it must mean that a big part of the German public has the power to defend their right to protect nature and consumer. The fact that businesses elsewhere can attack laws that prohibit pollution, etc — if that truly is the intent of global business — then that means the public in America and the rest of Europe lack the power to confront Big Business. Germany is a truer democracy; the other places are not.
To give business credit, at least they take the initiative to push their agenda, however selfish or not it may be, while their opponents waste time merely in opposition.
It’d be nicely ironic if business were to set a precedent that could come back and bite them. That is, it should not be too hard for an investor to show that some corporate welfare favors “hers” competitors, not “hermself”; and to show that taxes on wages, sales, and buildings hurts business while not taxing land and resources favors mere idle ownership. Indeed, rather than protest such clauses in trade treaties, wanna-be defenders of nature and justice could try to use the legal language to bring a “jujitsu” suit to court.
According to common wisdom, catch-up sleep repays one’s “sleep debt”. But chronic sleep loss may be more serious than previously thought and may even lead to irreversible physical damage to and loss of brain cells. The research is published today in The Journal of Neuroscience.
Ed. Notes: Can sleep-deprived people effectively agitate for economic justice? Whatever … once won, no one will ever have to lose sleep again due to their financial situation. So put all your surplus energy into winning geonomics!
“Science is the belief in the ignorance of experts,” said Richard Feynman in the 1960s.
The 500 major discoveries, almost all initiated before about 1970, challenged mainstream science and would probably be vetoed today.
Agencies claiming to support blue-skies research use peer review, of course, discouraging open-ended inquiries and serious challenges to prevailing orthodoxies.
Mavericks once played an essential role in research. Indeed, their work defined the 20th century.
We must relearn how to support them, and provide new options for an unforeseeable future, both social and economic. We need influential allies. Perhaps Guardian readers could help?
Donald W Braben University College London
John F Allen Queen Mary, University of London
William Amos University of Cambridge
Richard Ball University of Edinburgh
Tim Birkhead FRS University of Sheffield
Peter Cameron Queen Mary, University of London
Richard Cogdell FRS University of Glasgow
David Colquhoun FRS University College London
Rod Dowler Industry Forum, London
Irene Engle United States Naval Academy, Annapolis
Felipe Fernández-Armesto University of Notre Dame
Desmond Fitzgerald Materia Medica
Pat Heslop-Harrison University of Leicester
Dudley Herschbach Harvard University, Nobel Laureate
H Jeff Kimble Caltech, US National Academy of Sciences
Sir Harry Kroto FRS Florida State University, Tallahassee, Nobel Laureate
James Ladyman University of Bristol
Nick Lane University College London
Peter Lawrence FRS University of Cambridge
Angus MacIntyre FRS Queen Mary, University of London
John Mattick Garvan Institute of Medical Research, Sydney
Beatrice Pelloni University of Reading
Martyn Poliakoff FRS University of Nottingham
Douglas Randall University of Missouri
David Ray Bio Astral Limited
Sir Richard J Roberts FRS New England Biolabs, Nobel Laureate
Ken Seddon Queen’s University of Belfast
Colin Self University of Newcastle
Harry Swinney University of Texas, US National Academy of Sciences
Claudio Vita-Finzi FBA Natural History Museum
Ed. Notes: It’s funny that even forward-looking thinkers want to go backward to their good old days. Not knowing any other existence than living off the taxpayer, I suppose they can not envision one. But would their income depend on coercion in a just economy? Just like younger people crowd-source to fund a movie, couldn’t those academics cloistered in the ivory tower do the same thing? And in a geonomy — minus taxes and with a Citizen’s Dividend — how much would the researchers need?
This 2014 excerpt of Policymic, Mar 18, is by Tom McKay.
A study by researchers utilizing research tools developed for a separate NASA activity concludes we only have a few decades left before civilization collapses.
The report was written by applied mathematician Safa Motesharrei of the National Socio-Environmental Synthesis Center along with a team of natural and social scientists.
Analyzing five risk factors for societal collapse (population, climate, water, agriculture, and energy), the report says that the sudden downfall of complicated societal structures can follow when these factors converge to form two important criteria. All societal collapses over the past 5,000 years have involved both “the stretching of resources due to the strain placed on the ecological carrying capacity” and “the economic stratification of society into Elites [rich] and Masses (or “Commoners”) [poor].”
The two key solutions are to reduce economic inequality so as to ensure fairer distribution of resources, and to dramatically reduce resource consumption by relying on less intensive renewable resources and reducing population growth.
“Although the study is largely theoretical, a number of other more empirically-focused studies — by KPMG and the UK Government Office of Science for instance — have warned that the convergence of food, water, and energy crises could create a ‘perfect storm’ within about fifteen years.
Ed. Notes: Can we keep our civilization and our planet, too? I bet that economic justice would let us enjoy both. If we put geonomics into practice, we would waste much less. We’d also enable many more people to prosper, who then lower the birth rate. Whether it works or not, getting out from under taxes while sharing the worth of Earth sure would make life a lot more pleasant meanwhile.
This 2014 excerpt of Macrobusiness, Mar 11, is by Catherine Cashmore.
Rising property prices – the product of the plot of land that sits underneath the structure – are unashamedly promoted in most modern economies as the key driver to boost the privatised wealth of its nation, with the hope the payoff effect will feed other areas of consumption. They are no longer just ‘national’ affairs, but open to international speculation and investment, of which Australia is by no means immune.
None of this has assisted the home buying sector in America’s property market. Ownership rates continue to fall, and local buyers remain priced out. Yet Obama had no hesitation in boasting: ”Today, our housing market is healing!” (Healing!) “Home prices are rising at the fastest pace in 7 years…” (Faster even than incomes it seems, with first homebuyers at their lowest level since the crisis began.)
Premium localities in the cities of New York and London are openly marketed as ‘safe havens’ for the internationally wealthy. Isolated from the local economy, as local workers are forced out, and rumors of homes laying vacant for much of year provoke neighbourhood outrage. It’s now reported, for every minute you spend on the three Underground stops between Earls Court and Sloane Square, property prices rise by £96,647.
It’s not just the 1% of billionaires seeking out safe haven’s abroad, in what’s been termed the “largest and most rapid wealth migrations of our time.” But the rise of China’s ‘Consumer Class’ – ‘middle income’ individuals, discretionary spenders, whose wealth goes largely under-reported in a “grey economy” of illegal and quasi-legal activities. If trend continues, in a few years, China will become the world’s richest country, and India won’t be far in its wake.
The geographical location of land is fixed and limited in supply. Therefore we can’t all benefit from economic advantage gained from ownership of the best seats in town, without effective taxation of the resource that is.
A correctly administered broad-based land value tax (as explained here – reducing taxes on productivity) would not only encourage the ‘good’ utilisation of land, but if handled efficiently, gains could be fed back into the community to assist increased investment into infrastructure and social services.
This alone, would go a long way to reducing the wealth inequality currently experienced in our big cities.
a POV that Spain’s president might try. A few blocks from my room in Madrid at a book fair to promote literacy, Sr Zapatero, while giving autographs and high fives to kids, said books are very expensive and he’d see about getting the value added tax on them cut down to zero. (El Pais, June 4; see, politicians can grasp geo-logic.) But why do we raise the cost of any useful product? Why not tax useless products? Even more basic: is being better than a costly tax good enough? Our favorite replacement for any tax is no tax: instead, run government like a business and charge full market value for the permits it issues, such as everything from corporate charters to emission allowances to resource leases. These pieces of paper are immensely valuable, yet now our steward, the state, gives them away for nearly free, absolutely free in some cases. Government is sitting on its own assets and needs merely to cash in by doing what any rational entity in the economy does – negotiate the best deal. Then with this profit, rather than fund more waste, pay the stakeholders, we citizenry, a dividend. Thereby geonomics gets rid of two huge problems. It replaces taxes with full-value fees and replaces subsidies for special interests with a Citizens Dividend for people in general. Neither left nor right, this reform is what both nature lovers and liberty lovers need to promote, right now.
in part the Great Green Tax Shift maxed out. Economically, taxing pollution and depletion does reduce pollutants and extracts – and thus the tax base; plus such taxes are regressive, requiring a safety net. On the other hand, collecting site rent is progressive and generates a revenue surplus payable as a dividend to residents, which can serve as the safety net. Environmentally, taxes on waste and extraction do not drive efficient use of land, as does getting site rent.
the annoying habit of seeing the hand of land in almost all transactions. In geonomics we maintain the distinction between the items bearing exchange value that come into being via human effort — wealth — and those that don’t — land. Keeping this distinction in the forefront makes it obvious that speculating in land drives sprawl, that hoarding land retards Third World development, that borrowing to buy land plus buildings engorges banks, that much so-called “interest” is quasi-rent, that the cost of land inflates faster than the price of produced goods and services, that over half of corporate profit is from real estate (Urban Land Institute, 1999). Summing up these analyses, geonomists offer a Grand Unifying Theory, that the flow of rent pulls all other indicators in its wake. Geonomics differs from economics as chemistry from alchemy, as astronomy from astrology.
the study of the money we spend on the nature we use. When we pay that money to private owners, we reward both speculation and over-extraction. Robert Kiyosaki’s bestseller, Rich Dad’s Prophecy, says, “One of the reasons McDonald’s is such a rich company is not because it sells a lot of burgers but because it owns the land at some of the best intersections in the world. The main reason Kim and I invest in such properties is to own the land at the corner of the intersection. (p 200) My real estate advisor states that the rich either made their money in real estate or hold their money in real estate.” (p 141, via Greg Young) When government recovers the rents for natural advantages for everyone, it can save citizens millions. Ben Sevack, Montreal steel manufacturer, tells us (August 12) that Alberta, by leasing oil & gas fields, recovers enough revenue to be the only province in Canada to get by without a sales tax and to levy a flat provincial income tax. While running for re-election, provincial Premier Ralph Klein proposes to abolish their income tax and promises to eliminate medical insurance premiums and use resource revenue to pay for all medical expense for seniors. After all this planned tax-cutting and greater expense, they still expect a large budget surplus. Even places without oil and gas have high site values in their downtowns, and high values in their utility franchises. Recover the values of locations and privileges, displace the harmful taxes on sales, salaries, and structures, then use the revenue to fund basic government and pay residents a dividend, and you have geonomics in action.
the policy that the earth’s natural patterns suggests. Use the eco-system’s self-regulating feedback loops as a model. What then needs changing? Basically, the flow of money spent to own or use Earth (both sites and resources) must visit each of us. Our agent, government, exists to collect this natural rent via fees and to disburse the collected revenue via dividends. Doing this, we could forgo taxes on homes and earnings and subsidies of either the needy or the greedy. For more, see our web site, our pamphlet of the title above, or any of our other lit pieces; ask for our literature list.
about the money we spend on the nature we use. It flows torrentially yet invisibly, often submerged in the price of housing, food, fuel, and everything else. Flowing from the many to the few, natural rent distorts prices and rewards unjust and unsustainable choices. Redirected via dues and dividends to flow from each to all, “rent” payments would level the playing field and empower neighbors to shrink their workweek and expand their horizons. Modeled on nature’s feedback loops, earlier proposals to redirect rent found favor with Paine, Tolstoy, and Einstein. Wherever tried, to the degree tried, redirecting rent worked. One of today’s versions, the green tax shift, spreads out of Europe. Another, the Property Tax Shift, activists can win at the local level, building a world that works right for everyone.
one of many words I coined over 20 years ago: geoism, geonomics, geonomy, geocracy, etc – neologisms that later others came up with, too. CNBC once had a Geonomics Show, and Middlebury College has a Geonomics Institute. If “economy” is literally “management of the household”, then geonomy is “management of the planet”. The kind of management I had in mind is not what CNBC was thinking – top-down. My geonomics is not hands-on, interfering, but hands-off, organic. It’d strive to align policy with natural processes, similar to what holistic healing does in medicine, what organic farming does in agriculture. Geonomics attends to two key components: One, the crucial stuff to track is fat — or profit, especially profits without production, such as rent, or all the money we spend on the nature we use. Society’s surplus is the sine qua non for growth, needed to counter death – not merely more, but sustainable development, more from less. Two, the basic process to respect is the feedback loop. These let nature maintain balance automatically and could do the same for markets, if we let them. Letting them would turn our economies, now our masters, into a geonomy, our servant, providing us with prosperity, eco-librium (to coin a term) and leisure, time off — a hostile environment for economan but a cradle for a loving and creative humanity.
what you do when you see economies as part of the ecosystem, following feedback loops and storing up energy. Surplus energy – fat or profit – enables us to produce and reproduce. To recycle society’s surplus, the commonwealth, geonomics would replace taxes with land dues (charged to users of sites and resources, including the EM spectrum, and extra to polluters), and replace subsidies with rent dividends to citizens (a la Alaska’s oil dividend). Without taxes and subsidies to distort them, prices become precise, reflect accurately our costs and values; then, motivated by no more than the bottom line, both producers and consumers make sustainable choices. While no place uses geonomics in its entirety, some places use parts of it, most notably a shift of the property tax off buildings, onto locations. Shifting the property tax drives efficient use of land, in-fills cities, improves the housing stock, makes homes affordable, engenders jobs and investment opportunities, lowers crime, raises civic participation, etc – overall it makes cities more livable. Geonomics – a way to share the bounty of nature and society – is something we can work for locally, globally, and in between.
a way to connect the dots. Making the cyber rounds is “The Cavernous Divide” by Scott Klinger, from AlterNet (posted March 21): “As the number of billionaires in the world expands, so does the number of those in poverty.” Duh. The yawning income gap is not news. Nearly every issue of our quarterly digest carries a similar quote. Yet the connection was worked out long ago by one of America’s greatest thinkers, Henry George, who labeled his masterpiece, Progress and Poverty. Techno- and socio-advances always enrich few and impoverish many. Yet progress also pushes up location values – the geonomic insight (is Silicon Valley cheaper now or more expensive?). Instead of taxing income, sales, or buildings, society could collect those values of sites, resources, EM spectrum, and ecosystem services via fees and dues, which would lower the income ceiling, and instead of lavishing corporate welfare, pay out the recovered revenue via dividends, which would jack up the income floor. Dots connected.
a neologism for sharing “rent” or “social surplus” – the money we spend on the nature we use. When we buy land, such as the land beneath a home, we typically pay the wrong person – the homeowner. Instead, since land cost us nothing to make and is the common heri-tage of us all, rather than pay the owner, we should pay ourselves, our neighbors, our community. That is, we should all pay land dues to the public treasury, then our government would pay us land dividends from this collected revenue. It’s similar to the Alaska oil dividend, almost $2,000 last year. Indeed, the annual rental value of land, oil, all other natural resources, including the broadcast spectrum and other government-granted permits such as corporate charters, totals several trillion dollars each year. It’s so much that some could be spent on basic social services, the rest parceled out as a divi-dend, as Tom Paine suggested, and taxes (except any on natural rents) could be abolished, as Thomas Jeffer-son suggested. Were we sharing Earth by sharing her worth, territorial disputes would be fewer, less intense, and more resolvable.