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This 2014 excerpt of IDG News Service, May 14, by Loek Essers.
Samsung offered its “sincerest apology” for the sickness and deaths of some of its workers, vowing to compensate those affected and their families.
Samsung’s apology came in response to a proposal by families and the Supporters for the Health And Rights of People in the Semiconductor Industry (SHARPS) group.
So far there have been 26 victims of blood cancers (leukemia and lymphoma) reported to SHARPS, who worked in Samsung’s Gi-Heung and On-Yang semiconductor plants. Ten have died, the group said on it site.
Other alleged workplace-related illnesses reported to SHARPS include miscarriages, infertility, irregular menstruation, loss of hair, blood disorders, kidney troubles, and liver disease.
Thousands of chemicals that are used for the manufacturing of chips aren’t disclosed to the workers. Cleanrooms in the factories don’t filter toxic gases and are designed to protect the wafers rather than the workers. Workers are also often forced to turn off recently installed protective devices to keep up with the production rate.
Ed. Notes: Until robots perform the lethal jobs, employees die and employers grow rich. The bosses who decide to put their profit above their workers’ lives don’t suffer. The money for the compensation comes from the company, not from the managers, from stockholders not from those culpable. That must change. The liability of managers should not be limited. Indeed, they should work in the same environment that their assemblers do — good for the goose, good for the gander. Then those in charge would likely keep the factory clean and safe.
It would also help if employees had more say in job-place conditions. Workers could negotiate a greater say if they had more leverage. They could get that needed leverage if the corporation no longer were to receive corporate welfare and if the general public were to receive a Citizen’s Dividend. Then potential employees would not be so desperate to accept anything while companies would not exactly become desperate but would lose some political clout for hiding crimes.
What would be the source of funds for the Citizen’s Dividend? It’d be the value of sites and resources, which is the money that society spends for the land and nature it uses. Government would use its taxes or fees or leases or dues to redirect our spending so that it would not land in the pockets of sellers and lenders but in the public treasury. From there, government would pay a dividend a la Alaska’s oil share. Receiving it would give workers the leverage they need … until robots take over.
This 2014 excerpt of Thom’s Blog, May 12 is by Thom Hartmann.
Prior to a large and illegal ATV – or All Terrain Vehicle (something none of the riders invented, nor their rifles, nor the sewing machines that made their cowboy outfits) – ride through Recapture Canyon in Utah, there had been a great deal of criticism and concern from the Navajo Nation. The ride through Recapture Canyon would put thousands of years of cultural resources for Native Americans at risk, not to mention that the ride also went over an ancient and sacred Native American burial ground. But the riders ignored federal law and religious rights.
Some of the ATV-riding law breakers in Utah this weekend were members of the Cliven Bundy camp. In an email blast to his “followers,” Bundy wrote that, “We need to help the people of Blanding re-establish who is in control of the land. This is your next stand. Will you be there to help them like you helped us?”
While Bundy’s call to his followers to illegally ride on government land and put thousands of years’ worth of history and culture at risk is deplorable, it’s a symptom of a much larger problem in America, a problem which has been around since Columbus first sailed the ocean blue. If the culture isn’t White and European-based, much of white America pretty much doesn’t give a damn about it.
Ed. Notes: First Bundy and his followers refused to respect public land, next was sacred land. They still believe that might makes right and land is there for the taking. While they are petty and selfish and threaten violence, they are not much different from land-greedy groups elsewhere in America, everywhere on the planet, and all through human history.
While they are in the wrong, part of the blame falls on conventional society for not making clear the nature of property. Land becomes property only when the occupant or wannabe owner compensates those whom he excludes — his nearby neighbors. All of us have an equal right to life, none of us can live without land, so we all have an equal right to Earth.
Bundy, his followers, and many others despise this notion of paying rent to their community. But they shouldn’t. Not just because morally we all are obliged to compensate those whom we exclude from a part of Earth. But also because, bottom line, they can’t lose. As members of the community, they’ll be getting compensated, too. Everybody would pay land dues into the public treasury and get rent dividends back. Owners of land of average value or less — as are most of Bundy’s followers — would get back more than they pay. With a happy wallet, all they’d have to mollify is their egos about being renters to their neighbors.
This 2014 excerpt of Reuters, May 9, is by Philip Pullella.
Pope Francis told U.N. Secretary General Ban Ki-moon that the world body must do more to help the poor and should encourage the “legitimate redistribution of economic benefits by the State.”
Since his election last year, Francis has often called for significant changes to economic systems.
“An important part of humanity does not share in the benefits of progress and is in fact relegated to the status of second-class citizens,” Francis said.
Francis, an Argentine, is the first non-European pope in 1,300 years and the first-ever Latin American pontiff. He has consistently used his meetings with world leaders, including U.S. President Barack Obama in March, to champion the cause of the world’s have-nots.
He told the U.N. officials that while there had been a welcome decrease in extreme poverty and improvements in education “the world’s peoples deserve and expect even greater results.”
An awareness of everyone’s human dignity should encourage everyone “to share with complete freedom the goods which God’s providence has placed in our hands,” Francis said.
He told the United Nations leaders that the organization must have “a real impact on the structural causes of poverty and hunger”.
Ed. Notes: If the Pope, or anyone, is serious about sharing God’s providence and correcting the structural causes of poverty, then one has to institute the distribution of “natural rents” to everyone. These “rents” for use of parts of nature total the biggest part of GDP. Members of society spend (often indirectly) about half their income for land under their homes (whether a mortgage or a lease), for land growing the food they eat, for resources like oil that becomes fuel for cars and furnaces, for bandwidth in the EM spectrum when buying products advertised on radio or TV, etc.
Presently, only a few people capture this massive spending. They own the land or lending banks or other corporations. The immense stream they now corral could be redirected from the few to society at large if government were to charge taxes or fees or dues on occupation of locations, extraction of resources, and pollution of the environment. Once the funds are in the public treasury, then the government could pay citizens a dividend a la Alaska’s oil dividend, which is not redistribution but mere distribution.
Since most people are not now on the receiving end of society’s spending for Earth, nor do a good number of people own land (never mind an oil field), those people must work for others … when they can find land at all. To avoid poverty, people need land, a share of their region’s land value, and to be able to keep their earnings for themselves untaxed. It’s good that the Pope speaks about these topics, however vaguely, but it’d be great if he’d specify land as God’s providence and society’s failure to share Earth’s worth as the structural cause of poverty.
This 2014 excerpt of News Alert, May 11, is by David Stockman.
The auto bailouts did not save or create a single new auto job. They just shifted 25,000-50,000 assembly plant and supplier jobs from south of the Mason-Dixon Line to the rust belt in Ohio, Michigan, Wisconsin, and Illinois. That is, the North American and global auto industries were drowning in excess capacity on the eve of the crisis, and the only question was whether consumer demand for new cars would be satisfied by the efficient foreign transplant suppliers located in Alabama or high-cost, long-in-the-tooth UAW dominated plants in the north.
Thus, the political decision of the Bush and Obama Administrations to allocate auto jobs based on electoral politics and crony capitalist coddling of the UAW and the Chrysler/GM business complexes did not add a dollar to GDP; it just reshuffled the given level of consumer spending on new cars among regions. And the ultimate result is that the free market was blocked from doing its job of liquidating excess investment and uncompetitive suppliers and plants. In short, true national wealth was reduced by the auto bailouts.
Yet the damage goes beyond dollars and cents. The bailouts have also enabled the rise of a whole generation of soap-salesmen CEOs who tout miracle “recovery” stories, thereby reinforcing the “all fixed” meme. Fiat-Chrysler is a standout case of the latter, and its CEO, Sergio Marchionne, is a bubble illusion merchant of the first rank.
Ed. Notes: Getting bailed out is just one of many subsidies that car makers get. They also get subsidies for “research” and tariffs on imports and exemptions on pollution. If it weren’t for these favors from taxpayers, Detroit probably could not sell one more car — unless they made it non-polluting and fuel-efficient. If they can’t, they should lose market share to those who can. That’s how the market would deliver techno-progress, and how such progress would deliver clean air. And that’s why economic policy should be off limits to politicians of any stripe.
This 2014 excerpt of the Associated Press, May 11, is by Jack Chang.
A protest in eastern China over a plan to build a waste incinerator turned violent, with state media reporting that at least 10 demonstrators and 29 police officers were injured in clashes.
Thousands of people turned out for the protest, which followed government assurances that the project would not pose a health threat, and blocked a highway.
Environmental protests have been on the rise in China, with the public becoming increasingly critical of pollution and health hazards from industry.
“People are losing confidence in the way the government is handling these projects,” said Wu Yixiu, head of environmental group Greenpeace’s toxics campaign in East Asia. “There’s more of a perception that people are not willing to sacrifice the environment and health in exchange for development.”
District government said construction on the incinerator would not begin until the project had won public support. Hangzhou law enforcement authorities also said that protesters could receive more lenient punishment.
Ed. Notes: Pollution is not deadly only in China. People should demand an end to it everywhere. It’s not like there aren’t any solutions. Most waste can be recycled. Even toxic waste can either be neutralized or not used in the first place as there are usually non-toxic alternatives. It seems China and other developing nations are determined to mimic both the West’s good ideas and the bad. If only one Western nation were enlightened enough to geonomize — to defend rights, especially our rights to a healthy environment, to a share of the common wealth, and to our own earning untaxed — then other nations could copy that successful model and their societies could conserve and prosper both. After those newly growing nations geonomize, then the older industrial countries would be the ones to have to play catch up!
This 2014 excerpt of the New York Times, May 9, is by Edward Alden and Rebecca Strauss of the Council on Foreign Relations.
Each year, state and local governments in the United States spend more than $80 billion, or roughly 7 percent of their total budgets, on tax breaks and subsidies to attract investments from auto companies, movie producers, aircraft makers, and other industries.
State governments would be better off if they collectively ended the handouts and competed for business in other ways, such as making investments in infrastructure or education or offering lower overall tax rates.
The World Trade Organization has rules that restrict government subsidies. The Organization for Economic Cooperation and Development has a longstanding arrangement to limit financing subsidies to exporters. These international models should be adapted to our states. Kansas and Missouri are trying to reach a truce to stop bribing businesses to move from one side of the Kansas City area to the other.
Ed. Notes: It’s not just when state politicians compete that opening loopholes is bad; it’s always bad. Either everybody pays or nobody pays; fair is fair. If any state or locality or nation wants to be a haven for business — as are Singapore or Hong Kong — all it has to do is geonomize — as did Singapore and Hong Kong. That is, cut taxes on people’s efforts — even eliminate them. Instead, recover the rental value of land. Land is something that a new business moving in has to pay for anyway, so if the local government gets the payment, it’s only sellers and lenders who’d lose, and the value of land is not theirs anyway.
The value of land is created by the presence of community while land itself is created by nobody. Ground rent makes the perfect common wealth. It’s our earnings and purchases and buildings — private wealth — that should never be taxed.
And if we did not tax what we should not in the first place, we’d have no excuse to open loopholes for favored insiders.
This 2014 excerpt of the Los Angeles Times, May 5, by Amina Khan.
Looks like good news may come in threes. The teenage pregnancy rate, birth rate and abortion rate have all dropped sharply since their respective peaks in the 1990s. Fewer teens are getting pregnant in the first place.
The teenage pregnancy rate dropped 51% between 1990 and 2010. The 2010 rate of 57.4 pregnancies per 1,000 teenage girls and women 15-19 also represents a drop of 15% since 2008 alone.
The teen birthrate also declined by 44%, from its peak in 1991 of 61.8 to 34.4 births per 1,000. The teen abortion rate experienced the steepest drop of 66%, from 43.5 abortions per 1,000 at its 1988 peak to just 14.7 per 1,000.
The declines were seen across racial and ethnic groups, declining 56% among white teenagers (from 86.6 to 37.8 per 1,000), 56% among black teenagers (from 223.8 to 99.5 per 1,000) and 51% among Latino teenagers (from 169.7 to 83.5 per 1,000).
Progress from state to state was uneven. New Mexico had the highest rate, with 80 pregnancies per 1,000, and New Hampshire had the lowest, with 28 per 1,000.
Ed. Notes: Nobody in-the-know knows why today’s teens are not playing Juno, altho’ perhaps a teen does. It amazes me that society can change so much yet sociologists haven’t got a clue, really; maybe it’s not hearing “education” from adults but seeing older sisters lose their fun time.
BTW, if someone could figure why and how society changes, then perhaps they could create the conditions to guide society to make positive changes for the good of all … and if they could predict a fad or fashion, they could probably make a fortune!
Meanwhile, having kids later should be better for the kid, the mom, and the planet which might need a breather from humanitis. More at Progress.org.
This 2014 excerpt of Vox, May 5, is by Matthew Yglesias.
Dentists’ participation in Medicaid means dentists see more publicly insured patients without decreasing the number of visits provided to privately insured patients. Dentists manage to pull this off without increasing the number of hours per week that they work. Dentists don’t do much work in a typical dental visit; dental hygienists are the people who do the vast majority of the work in a dental office — and as a result, more patients increase not dentists’ work time but their incomes.
Waiting times for patients waiting to get in to see a dentist go up modestly. The increased wait times are concentrated in states with relatively restrictive “scope of practice” laws. In some states, hygienists can clean teeth with considerable autonomy from dentists whereas in other states a hygienist can only clean teeth if she’s employed by a dentist.
An essentially parallel situation exists in mainstream medical care. Some states allow certified nurse-practitioners to evaluate patients, diagnose, order and interpret diagnostic tests, initiate and manage treatments. People with serious medical conditions still need to see doctors. But patients with routine care needs can get them taken care of by nurses. Other states, by contrast, create more of a financial windfall for MDs.
Proponents of restrictive licensing say that the issue is patient safety and not greed. But research says otherwise. As Health Affairs has noted, “studies comparing the quality of care provided by physicians and nurse practitioners have found that clinical outcomes are similar” while subjective measures of patient satisfaction indicate that nurse practitioners do better than MDs.
As the number of people with insurance rises thanks to Obamacare, that’s great news for doctors but a much worse result for patients than we could achieve if we changed these laws.
Ed. Notes: Competition among competent providers is one main way that markets are efficient and why they need to be free of statist interference. Let government handle cases of fraud. The law need not create oligopolies and monopolies but instead defend our rights.
Four newspapers last month recommended that the public recover the rental value of land. The reform might lack intuitive appeal — people don’t like taxes and do love land — but it is fair, since site value is generated by the surrounding populace, and it is efficient, since it prompts owners to quit speculating and build. These four 2014 excerpts are from: (1) The Independent, May 4, by Patrick Diamond, a former Downing Street adviser to Tony Blair and Gordon Brown; (2) The Guardian, May 19, by George Monbiot; (3) The Washington Post, May 20, by Emily Badger; (4) The Economist, May 24.
We Need a Radical Reform of the Tax System
Progressives should focus on shifting the burden of tax from incomes to land values, unearned capital receipts, and property.
After 15 years of devolution, Scotland, the nation with the rich world’s greatest concentration of land ownership remains as inequitable as ever.
Fifty per cent of the private land in Scotland is in the hands of 432 people – but who are they? Many of the large estates are registered in the names of made-up companies in the Caribbean.
Landowners seek to justify their grip on the United Kingdom by rebranding themselves as business owners. The Country Landowners’ Association has renamed itself the Country Land and Business Association. So why do they not pay business rates on their land? Tax exemptions inflate the cost of land, making it impossible for communities to buy.
Though the estates pay next to nothing to the exchequer, and though they practice little that resembles farming, they receive millions in farm subsidies.
It should list all the beneficial owners of the land; impose the taxes Westminster refuses to levy.
Investors Make Housing Expensive. OK to Tax Them For It?
Increasingly, the wealthy in Latin America are buying homes in Miami. Canadians are buying homes in Arizona. Seemingly everyone but Londoners is buying a home in London — and then leaving it empty. And the Chinese are flocking to Vancouver (or, at least, their money is). Vancouver’s real-estate market is tightly connected to what happens in the Chinese economy.
For many of them, property in Vancouver or Seattle is a safer place to put money than property at home.
We expect housing prices to reflect local fundamentals — above all, how much people earn. In a global market, that may not be the case. If there are enough rich people in China who want property in Vancouver, prices can float out of reach of the people who live and work there.
Absentee homeowners can price out people who are actually living in the area.
Urban Planner Andy Yan suggests: Make foreigners pay a premium to buy up local housing. Tax them for the privilege — beyond existing property taxes.
Having risen by 8% in the past year, British house prices are almost back to the double-digit pace that preceded the financial crisis.
Britons are stretching to meet ever-rising prices by borrowing more. Average loan-to-income ratios have passed their 2007 peak. With more pay devoted to mortgage repayments, consumption is bound to fall. That is bad news for firms, and, in turn, workers. Household debt also reduces the funds that could be channelled towards productive investment.
Shifting the burden of tax from income to property would reduce the flood of foreign cash. Taxing land rather than buildings would encourage speculative construction and would push those sitting on large stocks to build or sell up.
Ed. Notes: Three of the four newspapers were British. When will the rest of the world catch up to the United Kingdom? If we’re serious about solving our problems, we need to adopt these good ideas that work right now.
Ed. Notes: Wouldn’t it be nice if outsider critics could improve the performance of those who get criticized? For me, the worst abuse in the US is the cost of housing which is the cost of land. If Americans shared the value of land, life would be so much better in all the aspects noted above.
Everyone is reading Piketty wrong — including Piketty! Want to really shut down the chief engine generating inequality? Forget the author’s solution and do this instead.
This 2014 excerpt of Salon, May 1, is by Jesse Myerson.
Thomas Piketty’s 700-page economics tome “Capital in the 21st Century” is beating out Colton Burpo on Amazon.
He shows that the rate (r) of return (profits, dividends, interest, rents, royalties, etc.), to the people who own capital assets (stocks, bonds, real estate, land, patents, etc.) outpaces the growth of the full economy (g).
The liberal response to this conundrum (including Piketty’s) is to try to grow g through more egalitarian taxation and stimulus and whatnot.
But we can actually solve the conundrum.
It is not necessary for everybody to keep bending over backward to grow the economy, just in order to help one another survive. Instead …
Make sure the people who capture r is: everybody. If the stream of wealth flows to everyone, rather than Donald Trump and Mitt Romney, then the pressure’s off g to keep pace with r.
We can let r exceed g and focus on more meaningful things than sales (which GDP, i.e. “growth,” reflects) – things like availing ourselves of our inalienable right to the pursuit of happiness.
Stocks and bonds can be held by a sovereign wealth fund just as easily as by a hedge, trust, mutual, pension or any other kind of fund. The only difference is that instead of heirs and speculators, the people getting the dividends, profits and interest is everybody.
Rent and real estate value can flow to everyone by taxing (especially urban) land value.
By liberalizing the intellectual property regime (i.e. stopping handing out all these monopolies), and moving to a Creative Commons structure, we can make sure that our society’s ideas and artworks aren’t just a source of cash for pharmaceutical companies, media conglomerates, and litigious vultures.
Ed. Notes: Actually, you don’t have to take over ownership of stocks and bonds if you recover rents (both for nature and for privilege). Most of the value in a corporate stock or bond is not in the factory or product but in the facilities’ locations and in the products’ patents and copyrights. So, if you institute land dues (or land taxes) and charge full market value for monopolies on new ideas (p&c), then you can ignore capital (s&b) and still recover all of society’s surplus — which is plenty of money for paying all citizens a decent dividend.
If people got a share of all the rents we all now pay for the land and government-granted privileges we use, instead of that immense flow going mostly to the 1%, and if the 1% no longer got corporate welfare, and if taxes were removed from our earnings and morphed into fees for pollution and depletion, which would hit the 1%’s dirty and wasteful corporations especially hard, then everybody’s income would be much closer together, the extreme highs and lows would not be so extreme, and the gaps in wealth and income would become of human-scale.
The principle to follow is really quite simple. Respect private property (human-made stocks, buildings, purchases, etc) and don’t tax it. Respect common wealth (the value of nature and privilege, neither one being the result of human exertion) and do share it — land dues in, rent dividends back out. Doing so is not leftist, not rightist, but geoist. And wherever geonomics has been employed, it has worked. Try and top that!
This 2014 excerpt of Business Insider, May 1, is by Bryant Jordan.
Thirty retired generals are urging President Obama to declassify the Senate Intelligence Committee’s report on CIA torture, arguing that without accountability and transparency the practice could be resumed.
“After taking office, you showed decisive leadership by issuing an executive order banning torture and other forms of abusive interrogation,” the retirees say in an open letter.
But with former government officials claiming that so-called “enhanced interrogation” techniques were effective, a future president could rescind the ban unless facts in the committee report are known, the generals wrote.
The signees include retired Marine Gens. Joseph Hoar and Charles Krulak, Army Gen. David Maddox and Army Maj. Gen. Paul Eaton. All the signees are part of a larger nonpartisan group of retired generals and admirals who work with the organization to oppose torture and promote prisoner treatment policies consistent with the Geneva Conventions.
“As retired flag officers of the United States Armed Forces, we believe that our nation is on its strongest footing when our defense and security policies adhere to our values and obligations under domestic and international law,” the group said in the letter.
The Senate Intelligence Committee voted in early April to release its abbreviated — nearly 500-page — declassified report on the CIA program. The full report, which is more than 6,000 pages, is being held pending redaction and declassification. That process itself has come under criticism since it is the CIA that would be doing the redacting.
It is a conflict of interest to allow the CIA to redact a report that alleges its own officials, including some still on the job, “authorized [the] brutal interrogation methods and systematically misled the White House, Congress, Department of Justice, and American people about the facts and consequences of using those methods.”
The “best chance” of avoiding a scenario in which a future president rescinds Obama’s executive order banning torture, the group says, “is for the Intelligence Committee’s report — which calls into question the morality, legality, and effectiveness of the CIA program — to be made public with minimal redactions.”
The Senate report panned the CIA program and said the information gathered through torture could have been gotten through other means from the 20 cases it investigated.
Ed. Notes: Are Americans losing their traditional concept of human rights? Once that goes, will Americans be able to see at all their right to a healthy Earth and a fair share of her worth? Is loss of self-esteem what makes possible the loss of political rights? If so, Americans had better regain some moral fortitude, and demand equal rights for all.
This 2014 excerpt of South China Morning Post, Apr 26, is by their editors.
Law-enforcement bodies are likely to ignore violations if polluters have the right connections. When they do prosecute, fines are capped at a level that is an acceptable cost against gains to be made.
Those caps on penalties are lifted in a sweeping revision passed this week. The amendments, effective on 2015 January 1, are a legal landmark in Beijing’s declared war on pollution and follow a pledge to abandon a growth-at-all-costs economic model that has spoiled much of China’s water, air, and soil.
Toxic, heavy metals contaminate 16.1 per cent of China’s soil and 19.1 per cent of arable land.
The new rules:
introduce an ecological “red line” that will declare certain regions off limits to polluting industries,
loosened a ban on most environmental non-government organisations filing lawsuits against polluters,
ensure that information on environmental monitoring and impact assessments are made public,
formalise a system for assessing local officials on their environmental record, and
give the Ministry for Environmental Protection the authority to take stronger punitive action, such as shutting down persistent or serious polluters and confiscating their assets.
That said, the key still lies in effective enforcement, amid fears that it will still be patchy, and in respect for the environment ministry’s new powers, which need unequivocal backing from the highest level.
This 2014 excerpt of FutureSpeak, Apr 24, is by Futurist Thomas Frey.
China’s WinSun Decoration Design Engineering Company not only printed a house in a day, they completed 10 houses in a single day using a massive printer that was 490 feet long, 33 feet wide, and 20 feet deep.
The ‘ink’ used was made of recycled construction materials, industrial waste and tailings.
Each of these homes cost around $4,800.
These houses can be ground up a second, third, or fourth time, and be reprinted as an entirely new home. They are, in fact, disposable houses.
WinSun also printed its own headquarters building, a 10,000 sq meter facility that was printed a few months earlier and took 30 days to create.
With a little refinement, future houses may be printed in less than an hour, reducing labor costs to almost nothing. With a little engineering work, everything from fixtures, cabinetry, plumbing, electricity, and heating/air conditioning can be modularized and rapidly installed into houses much like the Plug-n-Play hardware systems of the of the PC era. Ductwork, plumbing, and wiring channels can be printed into the structure, and adding water, power, and heaters may become as easy as working with Legos.
Once we are able to remove the transaction costs from housing, our populations become infinitely more fluid. A fluid population is a fickle one, often moving on a whim, rather than the long drawn out process that it is today. City populations will expand and contract in dramatic fashion, often reflecting people’s changing attitudes associated with political decisions, local elections, increased criminal activity, changing tax rates, and much more.
Ed. Notes: Funny how some think they can see the future when they can’t yet see the land. There’s already fast, cheap housing — rammed earth, straw bale, etc — even free housing in places like Detroit and the rest of the Rust Belt. What a 3D printer can not fabricate is a location, and that is the stumbling block to affordable housing.
How do you make locations or land affordable? Counter-intuitively, you tax them or otherwise collect their rental value for public benefit. Levying a tax or deed fee or land dues removes the value of the land from the mortgage and puts it into the public treasury. Thus mortgages for buildings become far more affordable. And poor people are already paying the value of their location in the monthly apartment rent that they pay.
Choosing to build on a cheap location is no solution, either. As other people follow suit, the price goes up. That’s what happens in every city where the hip, artistic young people congregate in a certain neighborhood. Once its reputation gets established, its site values skyrocket. And all the hip people are back to square one. No, there really is no way to avoid paying for land. The best that people can do is pay each other. That is, pay land dues in and get rent dividends back.
This 2014 excerpt of Occupy, Apr 25, is by Ellen Brown.
How to get Wall Street banks before a California jury? How about charging them with common law fraud and breach of contract? That’s what the FDIC just did in its massive 24-count civil suit for damages for LIBOR manipulation, filed in March 2014 against sixteen of the world’s largest banks, including the three largest US banks – JP Morgan Chase, Bank of America, and Citigroup.
LIBOR (the London Interbank Offering Rate) is the benchmark rate at which banks themselves can borrow. It is a crucial rate involved in over $400 trillion in derivatives called interest-rate swaps, and it is set by the sixteen private megabanks behind closed doors.
The biggest victims of interest-rate swaps have been local governments, universities, pension funds, and other public entities. The banks have made renegotiating these deals prohibitively expensive, and renegotiation itself is an inadequate remedy. It is the equivalent of the grocer giving you an extra potato when you catch him cheating on the scales. A legal action for fraud is a more fitting and effective remedy. Fraud is grounds both for rescission (calling off the deal) as well as restitution (damages), and in appropriate cases punitive damages.
Banks are estimated to have collected as much as $28 billion in termination fees alone from state and local governments over the past two years. This does not even begin to account for the outsized net payments that state and local governments are now making to the banks…
Interest-rate swaps are sold to parties who have taken out loans at variable interest rates, as insurance against rising rates. The most common swap is one where counterparty A (a university, municipal government, etc.) pays a fixed rate to counterparty B (the bank), while receiving from B a floating rate indexed to a reference rate such as LIBOR.
If interest rates go up, the municipality gets paid more on the swap contract, offsetting its rising borrowing costs. If interest rates go down, the municipality owes money to the bank on the swap, but that extra charge is offset by the falling interest rate on its variable rate loan. The result is to fix borrowing costs at the lower variable rate.
The catch is that the swap is a separate financial agreement – essentially an ongoing bet on interest rates. The borrower owes both the interest on its variable rate loan and what it must pay on its separate swap deal. And the benchmarks for the two rates don’t necessarily track each other. The rate owed on the debt is based on something called the SIFMA municipal bond index. The rate owed by the bank is based on the privately-fixed LIBOR rate.
Public entities wound up paying substantially more than the fixed rate they had bargained for – a failure of consideration constituting breach of contract. Breach of contract is grounds for rescission and damages.
A sampling of swaps within California, involving ten cities and counties, one community college district, one utility district, one transportation authority, and the state itself, the collective tab was $365 million in swap payments annually, with total termination fees exceeding $1 billion.
Requiring UC Davis to pay $9 million in termination fees and other costs to several banks would have covered the tuition and fees of 682 undergraduates for a year.
Why has UC’s management not tried to renegotiate the deals? The revolving door between management and Wall Street. Current and former business and finance executives play a prominent role on the UC Board of Regents.
Why do our state and local governments continue to do business with a corrupt global banking cartel?
They could set up their own publicly-owned banks, on the model of the state-owned Bank of North Dakota.
Ed. Notes: Rather than establish yet another bureaucracy, why not just expand the powers of public treasuries so they can act like banks? Let them accept savers and lend to borrowers.
Bigger picture, why let so much money be concentrated into one entity, whether a big bank or any government? A lot of the money that banks are stealing legally are “rents” or the money that the members of society spend for land and resources and privileges like corporate charters. That spending could be re-directed — using taxes and/or fees — into public treasuries then back out again as dividends to those members of society (a la Alaska’s oil share). Thereby the “rents” would not be left lying around for unscrupulous bankers or politicians.
Further, if you got a Citizen’s Dividend — your share of society’s surplus — then you would not need to save so much for the future, nor would you need to borrow so much or accept investments to start a business. Plus, you’d not need to save or borrow so much if you didn’t have to pay taxes on your earnings, your purchases, and your buildings. Thus, the whole rationale for having a banking “industry” could be reduced to a negligible aspect of the economy and of society.
as unfamiliar as geo-economics. The latter is a course some universities offer that combines geography and economics. A UN newsletter, Go Between (57, Apr/May ’96; thanks, Pat Aller), cited an Asian conference on geopolitics and “geoeconomics”. The abbreviated term ‘geonomics” is the name of an institute on Middlebury College campus and of a show on CNBC. Both entities use the neologism to mean “global economics”, in particular world trade. We use geonomics entirely differently, to refer to the money people spend on the nature they use, how letting this flow collect in a few pockets creates class and poverty and assaults upon the environment, and how, on the other hand, sharing this rental flow creates equality, prosperity, and a people/planet harmony. This flow of natural rent, several trillions dollars in the US each year, shapes society and belongs to society.
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.
an alternative to conventional land trusts. Just as it seems some functions should not be left to the market – private courts and cops invite corruption (while private mediation is fine) – just so some land should not be left in the market. That said, sacred sites do not make much of a model for treating the vast acreage of land that we need to use. So the usual trust model, which is anti-use and counter-market, can not apply where it’s needed most. Trust proponents worry about ownership and control – two very human ambitions – but they’re not central. Supposedly, we the people own millions acres – acres that private corporations treat as private fiefdoms – and conversely, the Nature Conservancy owns wilderness the public can some places use as parks. So, the issue is not who owns but who gets the rent – ideally, all of us.
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.
a way to redirect all the money we spend on the nature we use – trillions of dollars annually. We can’t pay the Creator of sites and resources and are mistaken to pay their owners this biggest stream in our economy. Instead, as owners we should pay our neighbors for respecting our claims to land. Owners could pay in land dues to the public treasury, a la Sydney Australia’s land tax, and residents could get back a “rent” dividend, a la Alaska’s oil dividend. We’d pay for owning sites, resources, EM spectrum, or emitting pollutants into the ecosphere, then get a fair share of the recovered revenue. The economy would finally have a thermostat, the dividend. When it’s small, people would work more; when it’s big, they’d work less. Sharing Earth’s worth, we could jettison counterproductive taxes and addictive subsidies. Prices would become precise; things like sprawl, sprayed food, gasoline engines, coal-burning plants would no longer seem cheap; things like compact towns, organic foods, fuel cells, and solar powers would become affordable. Getting shares, people could spend their expanded leisure socializing, making art, enjoying nature, or just chilling. Economies let us produce wealth efficiently; geonomics lets us share it fairly.
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.
more transformation than reform; it’s a step ahead. Harvard economics students this year did petition to change the curriculum, in the wake of the English who caught the dissension from across The Channel. French reformers, who fault conventional economics for conjuring mathematical models of little empirical relevance and being closed to critical and reflective thought, reject this “autism” – or detachment from reality – and dub their offering “post-autistic economics”. Not a bad name, but again, academics define themselves by what they’re not, not by what they are, unlike geonomists. We track rent – the money we spend on the nature we use – and watch it pull all the other economic indicators in its wake. We see economies as part and parcel of the ecosystem, similarly following natural patterns and able to self-regulate more so than allowed, once we quit distorting prices. To align people and planet, we’d replace taxes and subsidies with recovering and sharing rents.
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 scientific look at how we divvy up the work and the wealth, how some of us end up with too much or too little effort or reward. That’s partly due to Ricardo’s Law of Rent, showing how wasteful use of Earth cuts wages. And it’s partly due to how a society’s elite runs government around like water boys, dishing out subsidies and tax breaks. While geonomists look political reality right in the eye, without blinking, conventional economists flinch. When Paul Volcker, ex-chief of the Federal Reserve, moved on to a cushy professorship at Princeton cum book contract, the crush of deadlines bore down. So Volcker asked a junior associate to help with the book. The guy refused, explaining that giving serious consideration to policy would ruin his academic career. The ex-Fed chief couldn’t believe it and asked the department chair if truly that were the case. That head honcho pondered the question then replied no, not if he only does it once. And economics was AKA political economy!
of interest to Dave Lakhani, President Bold Approach (Mar 8) and Matt Ozga (Jan 29): “I write for the Washington Square News, the student run newspaper out of New York University. Geonomics seems like it has great significance, especially in this area. When was geonomics developed, and by whom?”
About 1982 I began. Two years later, Chilean Dr Manfred Max-Neef offered the term geonomics for Earth-friendly economics. In the mid-80s, a millionaire founded a Geonomics Institute on Middlebury College campus in Vermont re global trade. In the 1990s, CNBC cablecast a show, Geonomics, on world trade as it benefits world traders. My version of geonomics draws heavily from the American Henry George who wrote Progress & Poverty (1879) and won the mayoralty of New York but was denied his victory by Tammany Hall (1886). He in turn got lots from Brits David Ricardo, Adam Smith, and the French physiocrats of the 1700s. My version differs by focusing not on taxation but on the flow of rents for sites, resources, sinks, and government-granted privileges. Forgoing these trillions, we instead tax and subsidize, making waste cheap and sustainability expensive. To quit distorting price, replace taxes with “land dues” and replace subsidies with a Citizens Dividend.
Matt: “This idea of sharing rents sounds, if not explicitly socialist, at least at odds with some capitalist values (only the strong survive & prosper, etc). Is it fair to say that geonomics has some basis in socialist theory?”
A closer descriptor would be Christian. Beyond ethics into praxis, Alaska shares oil rent with residents, and they’re more libertarian than socialist. While individuals provide labor and capital, no one provides land while society generates its value. Rent is not private property but public property. Sharing Rent is predistribution, sharing it before an elite or state has a chance to get and misspend it, like a public REIT (Real Estate Investment Trust) paying dividends to its stakeholders – a perfectly capitalist model. What we should leave untaxed are our sales, salaries, and structures, things we do produce.