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.
The U.S. has a high tolerance for inequality, it is said, because so many Americans expect to be rich someday. But that hope is fast becoming a fantasy, according to Business Week’s Aaron Bernstein. In “Waking Up From The American Dream: Dead-end jobs and the high cost of college could be choking off upward mobility,” Bernstein portrays a nation that, as much it might like to see itself as a land of opportunity, has become significantly more stratified in recent years.
“Even as the U.S. economy was bursting with wealth in the 1990s, minting dot-com millionaires by the thousands, conventional companies were cutting the middle out of career ladders,” Bernstein writes, “leaving fewer people able to better their economic position over the decade.”
Citing the research of Bureau of Labor Statistics economists Jonathan D. Fisher and David S. Johnson, Bernstein reports that one common measure of relative mobility — the share of the population moving from one income quintile to another — fell by two percentage points, to 62%, during the 1990s. In a decade of strong economic growth, mobility should have increased rather than decreased, Bernstein says.
The December, 2003 Business Week story also draws on a Federal Reserve Bank of Boston analysis of family income, which shows that “the number of people who stayed stuck in the same income bracket — be it at the bottom or at the top — over the course of a decade actually increased in the 1990s. So, though the boom lifted pay rates for janitors and clerks by as much as 5% to 10% in the late 1990s, more of them remained janitors or clerks; fewer worked their way into better-paying positions.”
In the 1980s and 90s, American employers shipped vast numbers of blue-collar jobs abroad. Now this practice is rapidly being extended to white-collar jobs as well — a phenomenon exemplified by an unconfirmed report in the December 15, 2003 Wall Street Journal that 4,700 high-paying software engineering positions at IBM will be gradually transferred to India and China.
Business Week tells the story of Imelda Roman, a 33-year-old single mother employed as a counselor at a nonprofit social service agency in Milwaukee. Adjusted for inflation, Roman’s current salary of about $30,000 a year is almost identical to what she earned as a schoolbus driver more than a decade ago. “It’s hard to find a job with a career ladder these days,” Roman observes.
“The changing dynamic of the U.S. economy clearly has the most impact on those at the bottom,” Bernstein writes. “Some 49% of families who started the 1970s in poverty were still stuck there at the end of that decade, the Boston Fed study found. During the 1990s, the figure had jumped to 53%, even after accounting for two-earner families. A key reason lies with the creation of millions of jobs that pay less than a poverty-line wage of $8.70 an hour ”
In today’s economy, “upward mobility is determined increasingly by a college degree that’s attainable mostly by those whose parents already have money or education,” Bernstein continues.
“Although college enrollment has soared for higher-income students,” he notes, “more children from poor families can only afford to go to community colleges, which typically don’t offer bachelor’s degrees. The number of poor students who get a degree — fewer than 5% in 2001 — has barely budged in 30 years…”
Bernstein cites a recent update of a classic 1978 study that looked at how sons fared according to the social and economic class of their fathers, defining class by education, income, and occupation. Sons from the bottom three-quarters of the socioeconomic scale were less likely to move up in the 1990s than they had been in the 1960s. only 10% of sons whose fathers were in the bottom quarter had made it to the top quarter by 1998, the authors found.
“By contrast, 23% of lower-class sons had done so by 1973, according to the earlier study. Similarly, only 51% of sons whose fathers belonged to the second-highest quarter equaled or surpassed the economic standing of their parents in the 1990s. In the 1960s, 63% did.”
Immigrants, once symbols of U.S. mobility, are in the same boat. Compared with immigrants in the 1960s and ’70s, a larger share of newcomers today are high school dropouts, including hundreds of thousands of poor Mexicans. The job market here pays better than the one they left behind , but there are now fewer opportunities for higher education or for a middle-class lifestyle.
FDA Abandons Safety, Looks to Lobbyists Instead of Science
Below is a part of a recent Reuters news report on the corrupt Food and Drug Administration.
The editor of a top medical journal on Friday accused the U.S. Food and Drug Administration, the world’s most powerful drug watchdog, of endangering people’s lives.
Richard Horton of The Lancet said the FDA, which supposedly safeguards the health of 274 million people and regulates over $1 trillion worth of products, was compromised by funding [bribery] from the drugs industry and pressure from Congress.
In an editorial in the Lancet, he slammed the FDA for its handling of GlaxoSmithKline Plc’s controversial drug Lotronex. The FDA approved Lotronex in February 2000, but the company had to withdraw it on its own from the market nine months later after the deaths of five patients who had been taking it.
That’s bad enough. Now senior FDA officials are now trying to reintroduce it, Horton said.
“This story reveals not only dangerous failings in a single drug’s approval and review process but also the extent to which the FDA, its Center for Drug Evaluation and Research (CDER) in particular, has become a servant of the industry,” he wrote in an editorial in the journal.
According to Horton, serious side effects were evident during the pre-approval process and shortly afterwards but the FDA kept the product on the market. “The decision was to prove fatal,” said Horton.
The Lancet said scientists within the FDA who raised concerns about the drug’s safety were sidelined and excluded from future discussions. An independent review of research found serious flaws but calls for more studies were ignored.
The agency is supposed to monitor the safety, labeling, import, transport, storage and sale of food ingredients, drugs, cosmetics and surgical supplies.
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A politician is an artist in the art of following the wind of public opinion. He who follows the wind of public opinion does not follow his own judgment. And he who does not follow his own judgment cannot lead people out of the beaten path. He is like the tail end of the dog trying to lead the head. When people stand back of politicians and politicians stand back of the people People and politicians go around in a circle and get nowhere.
Peter Maurin, along with Dorothy Day, founded the Catholic Worker movement in 1933. They were great leaders of the nonsocialist left. We have great esteem for this movement, which continues to flourish. There are many Web sites that can tell you more — our favorite is the Houston Catholic Worker site.
Thousands of people are demonstrating world-wide against the war in Iraq. They cry out, “No War!” They block traffic. They march back and forth across the street. They hold up anti-Israel signs showing swastikas. They smash car windows. They shake their fists.
Their opposition to the war seems to be that they think the U.S. chiefs are imperialist bullies, or they just seek to control and profit from oil, or that the U.S. chiefs have just gone berserk. I don’t know where people go to get brainwashed, but wherever it was, the propaganda has been brilliantly effective. There is almost no intellectual content to the war opposition.
The true reasons why the U.S. chiefs have chosen war are strategic. The U.S. was viciously attacked on September 11, 2001. The attackers claim this was in response to American acts against Muslims, mainly the blockage of trade with Iraq, which has resulted in many deaths and sickness, and the U.S. military base on the holy Islamic ground of Saudi Arabia.
The U.S. could simply abandon that military base and end the trade restrictions. But that would be bad strategy. First, it would be seen as giving in to terror. Second, this would strengthen the military capability of Iraq, which is an aggressive threat to the region. Also, the Israeli-Palestinian conflict, another grievance of the anti-US terrorists, is impossible to solve while the current regime of Iraq is in place. The Iraqi regime pays Palestinian terrorists to murder Israelis.
Iraq thus presents an intolerable situation. There are great benefits from ending the Iraqi regime, not the least being the ending of the torture that some Iraqis suffer from. The U.S. chiefs have decided that these benefits are greater than the cost of the war. I believe that the costs of this war are greater than the benefits. There are more direct ways to resolve the Israeli-Palestinian conflict, and the U.N. inspectors could have kept Iraq from continuing their weapons program.
These alternative solutions confront the reasons for the war. This analysis also explains why the U.S. has chosen to wage war against Iraq but not North Korea. Clearly, much of the talk coming from the U.S. chiefs in Washington DC is propaganda unrelated to the true reasons. That Iraq has or may have weapons is not the real reason, since North Korea and Iran also have these. That Iraq has defied the U.N. is not the real reason, since many countries defy the U.N. That the Iraqi regime treats the people horribly is not a real reason.
But the U.S. chiefs are in a bind. They dare not articulate the true reasons. They cannot admit that an aim is to get out of the base in Arabia and end the trade blockage that fuels the resentment of Muslims and promotes terror. They cannot be seen to be meeting the political goals of the terrorists. That is why they talk about weapons of mass destruction instead.
So this war on Iraq is really part of a defensive war against Al Qaida, seeking to eliminate the grievances that allegedly fuels the hatred of America. While Muslims and Arabs may get aroused in the short run against America for what seems to be an attack on Arabs and Muslims, once America establishes a democracy in Iraq, so think the US chiefs, then the Muslims will see that this action was meant to help the Iraqis, not hurt them.
There are good reasons to oppose this war, but the protestors are not grasping them. They seem to have been manipulated to think that the U.S. chiefs are just evil aggressors seeking loot and power. Decades of Soviet and extremist propaganda seem to be paying off. People are easily swayed by superficial ideas that sound good. Truth is often complex, strategic, and requires a penetration beneath the surface. And most folks just don’t want to think.
“Think for yourself” said Henry George. Don’t believe anything anyone says until you have analyzed it for logic and evidence. That includes what I have said here. If the protestors really seek peace, they need to confront the strategic reasons for the war, because otherwise their tactics, rituals, marches and slogans will be as empty of effects as they are of thought.
Copyright 2003 by Fred E. Foldvary. All rights reserved. No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, which includes but is not limited to facsimile transmission, photocopying, recording, rekeying, or using any information storage or retrieval system, without giving full credit to Fred Foldvary and The Progress Report.
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Perhaps this will be but a minor note in the annals of history, but on January 22, 2004, a man completed a naked hike from the southern tip of Great Britain to its northern end.
Stephen Gough, age 44, began his nude hike at Land’s End in southwest England in June 2003 and walked 847 miles (1,450 kilometres) to John O’Groats in Scotland. It took him seven months, five of them spent in prison. Government operatives repeatedly sought to block his journey by arresting him, putting him on trail, and jailing him, but he persevered and stuck to his naked principle. His victorious arrival at John O’Groats was celebrated by a group of local folk who cheered and welcomed him. The media was also there to record this triumph of the human will against the forces of the state.
The “naked rambler,” as he came to be called, was not completely bare, as he wore socks, boots, and a hat, and carried a backpack. Nudists like him do not completely reject clothing, but accept what is needed for health and safety. The hat offered protection from solar radiation, and the socks and boots prevented injury to his feet. He saw no need for other textile coverings, so he wore none. This was all quite rational, as far as he was concerned. Gough sought to promote the idea that the human body is not an evil thing, and that human beings have a natural right to be their pure selves. “My body,” he said, “is who I am.”
But the British Empire struck back at Gough. Some British subjects were offended. They complained to the authorities. But if it is properly a crime to offend others, then there is no free speech, no freedom of religion, no liberty to express one’s culture. This effectively gives those who control government the authority to impose their particular values on all others. This is not liberty but supremacism. The proper way to avoid being visually offended in a free society is to be in a community of property owners who do not allow such sights on their own property. But instead, these British subjects sought to harness the might of the Kingdom to impose their values everywhere.
Sixteen times, British officials arrested this man, even though there is no law specifically prohibiting public nakedness in Great Britain. The United Kingdom’s law prohibiting indecent exposure applies not to mere nudity but to sexual exposure or the intent to harass others. Gough was convicted of behaving in a “disorderly manner” and “committing a breach of the peace.” He had to appear in court several times, and was put in prison twice.
Gough refused to cover himself with clothes when he appeared in court before their royal honors, the judges of Great Britain. The court authorities would wrap him in a prison blanket.
As he climbed the Scottish highlands in the winter, the temperature became cold Had he been allowed to walk unhindered from the beginning, it would still have been summer when he took the high road. The Great British Empire, with all its majestic laws and royal officials and prison dungeons, was powerful enough to delay him, but the Empire of law and government force could not defeat this one single human being who had no weapons except his naked body and his will power. Having been forced to trek the Scottish highlands during winter, if he had surrendered to circumstances and donned clothing, the Empire would have won. He stuck to naked principle and refused to dress. The human will of one man thus triumphed over all the forces of the mighty Kingdom.
This is not merely the story of one man’s perhaps odd ambition to hike naked from one end of Great Britain to the other. Steve Gough symbolically represents the bare human being with just his body and will. The royal British authorities represent all the forces of the state, with all their kingly laws, weapons, prisons, and cultural prejudices. By refusing to yield, this single man was victorious against the regal power of the state.
To be sure, in a more vicious state, the authorities would have simply killed him. That Gough was not just shot and dumped in the ocean demonstrates the underlying rule of law rather than whim in the U.K. Nevertheless, the Empire tried to stop him, and the Empire lost that battle. So in his perhaps odd way, Steve Gough showed that peaceful civil disobedience, even by one single naked man, can triumph over governmental force. Had Gough resorted to violence, his goal would have been discredited and defeated. The lesson here for those who seek to change society and government policy is that taught by Thoreau, Gandhi, and Martin Luther King Jr., that determined, persistent civil disobedience works.
Copyright 2004 by Fred E. Foldvary. All rights reserved. No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, which includes but is not limited to facsimile transmission, photocopying, recording, rekeying, or using any information storage or retrieval system, without giving full credit to Fred Foldvary and The Progress Report.
Bush Administration’s Fake Democracy Is Not Good Enough
Al-Sistani’s Call for Democratic Elections
In response to U.S. plans to avoid democracy in Iraq while claiming to establish it, some leaders with a stronger sense of democracy have proposed genuine elections. Now the Bush administration is in the embarrassing position of opposing democratic elections, much as the Reagan administration opposed democratic elections in South Africa.
by Erich Marquardt
In an effort to limit the perception that the United States is occupying Iraq, Washington plans on transferring power to an Iraqi provisional government by mid-2004. As part of the Bush administration’s power transfer plan, U.S. and Iraqi Governing Council officials would appoint caucus members from each of Iraq’s 18 provinces who would be responsible for electing individuals to sit in the country’s new national assembly.
The national assembly would elect a provisional government to take power from the U.S.-led coalition on July 1. This provisional government would then draft a new constitution to be ready for national elections sometime in 2005. This plan virtually ensures that U.S. officials and their handpicked Iraqi Governing Council members would be able to shape future political developments in Iraq by having input on the makeup of the national assembly and the provisional government. However, in recent weeks, Washington’s plans for the future transfer of power in Iraq have encountered a wave of resistance.
The most significant resistance to this plan was offered in a recent edict delivered by Grand Ayatollah Ali al-Sistani, the most prominent Shi’a religious leader in Iraq. Al-Sistani does not accept the proposition that U.S. and Iraqi Governing Council members should have such strong influence over the makeup of the national assembly. Al-Sistani said, “No one has the right to appoint the members of the constitutional assembly. We see no alternative but to go back to the people for choosing their representatives.”
Much to the dismay of U.S. officials, al-Sistani’s demand for democratic elections to decide who will sit on the national assembly is an effort to give more power to Iraq’s large Shi’a Muslim community and less power to the U.S.-led coalition. Iraqi Shi’a make up 60 percent of the country’s population, yet they have always been marginalized by Iraq’s Sunni population who have functioned historically as the ruling class.
Al-Sistani is certainly aware that the best possible outcome for Iraq’s Shi’a majority would be if general elections were held to decide major political issues, such as the makeup of the national assembly; this would ensure significant Shi’a influence over substantive content of Iraq’s constitution. Abdul Aziz al-Hakim, a Shi’a cleric and member of the Iraqi Governing Council, agreed with al-Sistani’s concerns, arguing that current U.S. plans diminish “the role of the Iraqi people in the process of transferring authority to Iraqis.”
Al-Sistani’s disagreement over U.S. plans is causing a serious dilemma for Bush administration policymakers. The difficulty with complying with al-Sistani’s demands is that if Iraq were allowed to follow a thoroughly democratic path, it is likely that the new government would run counter to U.S. interests. On the other hand, al-Sistani is too influential of a figure to ignore. Since he is the religious leader of Iraq’s 15 million Shi’a, he has the ability to completely disrupt civil society by simply calling his religious community to action.
Al-Sistani also has the support of other influential Shi’a leaders in Iraq; in addition to al-Hakim, Grand Ayatollah Mohammed Taqi al-Modaresi, who is based in Karbala, argued on Tuesday that the national assembly should be elected through national elections rather than through regional caucuses. Al-Modaresi gave a strong message to the U.S.-led coalition: “I am concerned about increasing frustration among Iraqis and I am telling everyone that they are a peaceful people. But it will be a different story if they run out of patience. I fear sedition.”
Al-Modaresi’s warning should be heeded. Iraqi Shi’a have largely accepted the U.S.-led occupation thus far. Their acceptance stems from the fact that if Iraq were to have democratic elections, Shi’a leaders would take power simply because of their majority status. If U.S. officials try to avoid this outcome — such as by rejecting al-Sistani’s and other Shi’a leaders’ recent demands for democracy — the Shi’a community could quickly resort to violence, fearing a return to political disenfranchisement. Needless to say, if the huge Iraqi Shi’a population were to revolt, it would cause the situation on the ground to deteriorate rapidly for U.S.-led military forces.
It seems then that Washington must acquiesce or at least seriously consider al-Sistani’s demands. Washington really has no alternative Shi’a leader to turn to. The Shi’a leader seemingly most in line with Washington’s desires was the head of the Supreme Council for Islamic Revolution in Iraq, Muhammad Baqir al-Hakim, who was killed in a bombing in Najaf on August 29, 2003.
Another powerful Shi’a leader in Iraq is Moqtada al-Sadr, an outspoken critic of the U.S. occupation and son of Ayatollah Muhammad Sadiq al-Sadr, a highly venerated cleric assassinated in 1999. Moqtada al-Sadr, whose base is the al-Kufa mosque in Najaf, has been urging the creation of a Shi’a guerrilla army. If the Americans are faced with a decision of choosing to support either al-Sistani or al-Sadr, they will have to turn to the former.
Yet if Washington is willing to support al-Sistani’s calls for democratic elections, it could lead to a constitution with strong religious undertones, possibly threatening the secularism of Iraqi society. Shi’a leaders may also ease diplomatic relations with neighboring Iran, a country ruled and populated by Shi’a. If Iraq and Iran were to greatly improve relations, it could threaten to destabilize the current balance of power in the Middle East. The Bush administration may consider this result untenable. William Beeman, the Director of Middle East Studies at Brown University in Rhode Island, recently warned, “Washington may consider it untenable, but Washington will be unable to prevent such a development if they support true democracy in Iraq.”
There still is hope in Washington that al-Sistani will remain an acceptable figurehead. Al-Sistani recently assured Washington that his proposed version of a new government in Iraq would not model the theocracy found in neighboring Iran, but that “authority [in Iraq] will be for the people who will get the majority of votes.” If the Bush administration wants to create an Iraqi government in line with U.S. interests, it will have to work with al-Sistani and consider his demands.
Thanks to our friends at www.pinr.com for permission to reprint this report.
Cellular telephones allow people to carry portable phones with them almost wherever they go. They make people more productive by reducing wasted time. But they can also be a negative externality, a hazard and a nuisance to others.
Cellular phones have been recognized as one of the key innovations of the 1990s. The USA has been issuing stamps for a “celebrate the century” series, with stamps showing the key cultural, historical, and scientific landmarks of each decade. The last of the series was issued on May 2, 2000, for the 1990s. One of the stamps shows a man using a cellular phone.
The United States Postal Service press release of April 14, 2000, states: “The popularity of cellular phones skyrocketed as the phones became smaller and cheaper, sound quality improved, and service became more widely available. In 1999, more than 78 million Americans had cellular service.”
This new technology comes at a price to society, and it involves land rent. Cell phone users are carrying their talkies into restaurants, coffee shops, concerts, class room, and even church services. When the phone rings, it disrupts the performance or reading or whatever activity in going in that area. Then when the user talks on the cell phone, it is often in a loud voice, with a greater volume than normal in a coffee shop or restaurant.
Users are thus imposing a negative external effect on others, without any compensation. Others have paid to use that space, but are not fully getting the benefits they paid for. The phone user, or abuser, is expropriating these benefits, and the rentals paid by others!
Cell fawners are also driving while talking, and so not fully paying attention to the road. Normally, one can drive and hold a phone, but one never knows when there will be an unexpected object on the road or the car ahead will brake suddenly, requiring the full attention of the driver and the use of both hands.
The remedy needs to involve both governmental and private responses. It would not violate liberty for the traffic laws to prohibit and penalize holding a phone with one hand while driving or using a cell phone at all during hazardous driving conditions.
As to disruptive telephone usage indoors, some firms such as restaurants have already started to prohibit them in the premises. Concerts, churches, and coffee shops can post a notice on the door stating that cell phone usage is not allowed. Those who wish to use them can then join the smokers outside.
Another possibility is to have a cell-phone usage fee. This fee would then compensate others for decreasing the value of the space. It could lower the price of entry or of the goods. You would buy your coffee for 25c less, while the cell phone user pays extra.
Perhaps better technology will eventually solve the externality problem. Virtual reality now mostly involves virtual inputs, but physical outputs. It provides visual inputs via screens and audial inputs via earphones. But if you want to provide output, such as talking to the virtuality machine, everyone else can hear it too. We need a way for people to talk without being heard. It’s not the talking that is the problem, but the involuntary hearing.
We need virtual talking – for someone to talk and not be heard. For that, the sound waves will need to be blocked. The technology for hiding or blocking sound as well as light waves is still in the future. If that technology is ever developed, people will be able to make themselves invisible and inaudible.
Meanwhile, for today, we need better policies for sound intrusion. We need for society to recognize that cellular phone sound pollution is a social cost that is paid by somebody. Ideally, the cost of pollution should be paid by the polluter. When it comes to sound waves, so long as hearing is involuntary, air is not free.
What is your opinion? Share it with The Progress Report! Copyright 2000 by Fred E. Foldvary. All rights reserved. No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, which includes but is not limited to facsimile transmission, photocopying, recording, rekeying, or using any information storage or retrieval system, without giving full credit to Fred Foldvary and The Progress Report.
When we say we believe in democracy, what exactly are we saying? Is “democracy” a specific list of conditions, or is it more like a feeling? Is the faith that we place in democracy a religious faith?
by Schuyler Lake
The question of whether al-Sistani’s idea for democracy in Iraq is any better than the U.S. coalition proposal, begs a deeper question — what do we mean when we speak of democracy? Democracy is an ancient ideal of wide appeal which has become plastic and ambiguous. Today it is associated with a variety of schemes and ambitions which have little or nothing to do with any specific meaning of the term. I love democracy, you love democracy, Pat Buchanan loves democracy, and I wouldn’t be surprised if Robert Mugabe loves democracy too.
The 18th and 19th centuries were a heyday for democracy. In those times, democracy really earned and deserved its capital D. But even then it was badly mixed up with other ideals like Liberty, Equality, Fraternity, and Prosperity. Then came the horribly bloody, ruinously divisive 20th century, which challenged the validity of all political idealism, democracy included. If one assumes that America came out of WWII morally unscathed, one is sadly mistaken, and has not bothered to heed post-war art. But thanks to our mass media (and a special thanks to Walt Disney), many, if not most Americans now equate democracy with material comfort, security, and even luxury. As if the one were a corollary of the other.
So we have a problem. The problem is not that some interpretation of democracy won’t prove completely valid and practicable, nor that the human longing for true community implicit in the democratic ideal is somehow outmoded, but rather that the word “democracy” itself has been damaged and debased beyond repair. Much as the word “god” has been.
Fred Foldvary’s proposals for a “cellular democracy” in Iraq are brilliant, absolutely brilliant — and might be very effective, were they ever to be implemented. However the chances of that happening are exactly nil. Those who hold power in Iraq (as elsewhere), are jealous of their power. Given the immediacy and the extent of the threats confronting them, both immanent and percieved, they can hardly be blamed for their possessiveness. Fear is their motivating power, ahead of idealism. Meanwhile, George Bush and his corporate bullies are doing all they can to increase the fear factor, rather than diminish it. Anyone who still thinks that Bush’s prime concern is for democracy and freedom needs a lot of strong coffee. In this environment, the ideal of “democracy” becomes not only irrelevant, but positively misleading.
As the ideal of “communism” has also become irrelevant, for the world at large. For better or for worse, and for whatever reason, the days of the Internationale are long gone. We can clearly see the three great Idealisms of the 20th century — Communism, Fascism, and Democracy, in ruins about our feet. Apparently what Western thinkers are doing in response to this dilemma, is abandoning the field to corporate hegemony, and unbridled opportunism. There are disturbing parallells to the Vandals sacking Rome. The executive officers of Halliburton for instance laugh — I mean literally laugh — at the Green Party.
Liberal humanists in general, by adhering to a long-lost, ill-defined, and much-disputed ideal of “democracy”, as if it were their guiding light, have failed to define their actual objectives… objectives which, I contend, are religious in nature rather than political.
What the Progress Report is doing (and doing very well) and what myriad other progressive sites are doing, more or less well, is essentially religious, rather than political in nature. The very idea of open debate and freedom of individual expression is a religious ideal… albeit an open-ended and anti-authoritarian one. I don’t deny that democracy, as a system (or rather various systems) of collecting and tabulating votes, is related to this ideal — but it is not essential to it.
Communism too, was a religious movement, though its god was man-made rather than pre-existing from above. What made Communism religious is the fact that people really believed in it. Lots of people, not just a few. Millions. That’s what made it powerful — the fact that so many people were able to believe in it. It was not the inherent logicalness of Marxism that made it powerful and dangerous, but rather the fact that it was able to harness the hopes of so many humans. It made sense. Communism might indeed have taken over the world, had it not made the essential and disastrous mistake of denying God. But apparently, Communists had no idea that their advocacy for the disadvantaged had anything to do with God. They were so accustomed to fighting the Church/State, so long bitterly opposed to a particular God, and so myopic as to believe that they had invented the idea. Or maybe in many cases, they knew the truth but chose to remain silent.
The remnants of the ideals of democracy today will be able to do no such thing. Neither will the bogus promises of global corporatization, as it rapes the planet for selective benefit, and consigns millions to misery, without recourse to any ideology whatsoever, save that of a victor enjoying its spoils. Innumerable devout Muslims see this world differently — it’s no wonder that they do, and I for one am very glad that they do. They still believe that God (as they percieve Him/Her/It?) has a central place in daily affairs, which is inseparable from politics. Who’s to say that they are wrong, and that the Cheney/Wolfowitz cabal is right? Only a self-serving fool like Bush, or his unthinking “Christian” supporters would presume to make such a judgement, denying Muslims the right to interpret God as they see fit. The fact is, that most neo-religious movements the world over are also neo-fascist. And that all of them implicitly advocate, or at least condone war.
In conclusion: that religion is essential to human community, whether that religion be organized and strictly defined, or not. Also, that “democracy”, no matter how one might define it, is insufficient as a religious ideology for liberal humanism. Even more, it is positively misleading.
Schuyler Lake lives in New Mexico, and has spent much time in Europe and Canada. He works as a painter of houses and “very odd and almost completely unsaleable canvases.” Lake observes that patriotism and a sense of global brotherhood are not at all incompatible.
Under the old regime, Iraq taxed up to 60 percent of individual and corporate incomes under its Tax Law No. 113 of 1982, with exemptions for foreign-company development projects. In practice, however, many ordinary Iraqis did not pay any tax on their small incomes. After the U.S. invasion and the collapse of the old regime, Iraq became in effect tax-free. This brief period of tax freedom has come to an end.
On Sept. 15, 2003, the U.S. military administration of Iraq imposed an income tax of 15 percent on Iraq, starting in January 2004. While a flat 15-percent rate may seem low relative to taxation in the rest of the world, the tax adds an unnecessary hardship on the struggling economy of Iraq. Many of the countries along the Persian Gulf have no income taxes, so this tax, in addition to the danger of violence, creates a major comparative disadvantage for Iraq.
L. Paul Bremer, the administrator in Baghdad, stated in Coalition Provisional Authority Order Number 37, “Tax Strategy for 2003,” that “The highest individual and corporate income tax rates for 2004 and subsequent years shall not exceed 15 percent.” Bremer exempted the coalition authority, the armed forces, their contractors and humanitarian organizations from taxes.
Some U.S. conservatives are rejoicing. “It’s extremely good news,” said Grover Norquist, head of Americans for Tax Reform. “It might be a hint to the rest of us.” Proponents of a flat-rate income tax have for many years been advocating changing the U.S. tax system from rates which rise with higher income to one flat rate for all or most income. They point to several countries, including Russia, which have implemented a flat tax.
A flat-rate income tax is indeed less of an economic burden than the current U.S. system, but any general income tax still imposes an excess burden on the economy, reducing production and investment. The burden is unnecessary because the use of land rent for public revenue has no excess burden. An opportunity to truly liberate Iraq’s fiscal policy has been squandered. Oil revenues could finance the national government of Iraq, and the tapping of land value or land rent could finance local government, with no need to tax income or sales.
Supply-side economics is the policy of reducing taxes and regulations to stimulate a greater supply of production and investment. A complete supply-side policy is a marginal tax rate of zero, i.e. no tax on any income from productive activity. The tapping of land rent acts like a fixed annual cost, with no tax penalty on wages, profits, and investment returns. Those who call themselves “supply-siders,” but who reject taxing land value in favor of instead taxing income, are either woefully ignorant or else they are, well, disingenuous.
This tax decree is opposed by most of the members of the U.S.-appointed Iraqi Governing Council. This tax will not endear the military occupation to workers and entrepreneurs in Iraq. The tax will have to be enforced, and a flat income tax can be evaded just a graduated one can. There will have to be files on all taxpayers, creating a massive bureaucracy. There will have to be intrusive tax audits, snooping, confiscation of assets, and imprisonment of Iraqi non-taxpayers and tax resisters. The tax will create even more enemies against the U.S., especially since the U.S. military occupiers and contractors are exempt!
Imagine a tenant farmer in Iraq who has to struggle with contaminated water, insects, and theft of his equipment. On the way to market he has to pass through U.S. checkpoints, where he is delayed, quizzed and groped for guns. After paying for rent and supplies, he manages to make a profit just enough to feed his family and buy seeds and gasoline, but now, down comes the U.S. tax collector to take way some of his gains. The tax is 15 percent of his income, but what is the profit? He has to prove how much his crop revenue is, and what his expenses are. Does he have receipts? Are they genuine? Is he selling crops for cash? What about food the family grows for itself? Is he sophisticated enough to include depreciation as an expense?
The Iraqi tax collector working for the military occupation has to guess at what the right income is and whether the farmer is telling the truth. Maybe if the farmer gives him a dinner and some cash and a chicken as gifts, the tax collector will be amenable to a lower tax estimate. Or maybe this farmer is unpopular, and tax evasion would be a good excuse to lock him up in prison.
Can you see the implications? Do we really want to sow more corruption and oppression? Just because a flat tax works OK in Estonia does not imply it will go smoothly in Iraq. This tax will be a nightmare and another excuse for U.S.-hating terrorists to do violence. This is just one more example of the incredibly inept and incomprehensively foolish U.S. policy in Iraq.
Copyright 2004 by Fred E. Foldvary. All rights reserved. No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, which includes but is not limited to facsimile transmission, photocopying, recording, rekeying, or using any information storage or retrieval system, without giving full credit to Fred Foldvary and The Progress Report.What are your views? Share your opinion with The Progress Report!
Logging Scandal — Corporate Welfare Queens Get Paid to Seize Public Resources
Here is a news update from Taxpayers for Common Sense. TCS is the best organization that monitors excessive government spending, corruption and corporate welfare.
WRONG AXE, MR. PRESIDENT
For three years straight, we have been hootin’ and hollerin’ about how important it is for President Bush to pull out the budget axe and cut wasteful spending. Well, on the eve of Christmas Eve, the administration decided to use an axe; but it was the wrong one.
Late on December 23rd, while the majority of American’s were focused on last minute gift buying and spreading the holiday joy, the Department of Agriculture announced that 300,000 acres of the Tongass National Forest would be exempted from the federal rule limiting taxpayer subsidies for private logging-road-building in national forests. Two things can be surmised from the timing of this announcement:
The administration wanted to give the timber industry a little Christmas bonus, courtesy of the American taxpayers.
When the Department of Agriculture felled this tree in the forest, they wanted to guarantee that no one would hear it.
The practice of releasing controversial decisions during media downtimes such as late Friday afternoon or the eve of a holiday has become commonplace. It’s probably the simplest way to pull the wool over our eyes, keep the issue off the media’s radar screen, and thereby lessen the chances of public outrage.
But, the folks at the United States Department of Agriculture took extra care to obscure the Tongass announcement. In an obvious attempt to further distract the American public, they buried it at the very end of the press release announcing the first case of Mad Cow disease in our nation. Get Americans to freak out about a scary brain wasting disease and surely they won’t care about paying tens of millions of dollars to pave the timber industry’s way through the forest.
Pardon the pun, but our beef with the Tongass decision is that taxpayers are already paying and will continue to pay timber companies to relieve us of the most valuable and profitable trees in the nation. Subsidies to timber companies defy every principle of fiscal responsibility, yet the Bush administration wants to keep squandering millions on the biggest money-losing forest in the nation.
A recent study found that the Forest Service lost more than $34.8 million on the Tongass timber program in 2002, collecting revenues of just $1.2 million from the forest companies. Road building subsidies alone in this forest cost taxpayers $23 million between 1998 and 2001, creating an infrastructure that has 10 times more miles than the Indy 500 and a maintenance backlog that will cost us more than $800 million.
This fiscally misguided decision further demonstrates that this administration will put the political will and financial interests of the timber industry, Alaska’s governor, and Sen. Ted Stevens (chairman of the Senate appropriations committee) in front of the financial well-being of U.S. taxpayers. This decision to exempt the Tongass from the Roadless rule guarantees that this forest will remain the biggest giveaway to timber companies in the nation.
It looks as if our spell to get the President to cut the budget deficit has conjured up the wrong axe. Instead of relieving our long-term deficit woes, this axe is going to increase them!
For more information, contact Keith Ashdown at (202)-546-8500 ext. 110 or by email at firstname.lastname@example.org TCS is at www.taxpayer.net
Doesn’t the U.S. government have a budget deficit? Why is it giving away public timber resources at below market value, and even below break-even? That anti-American policy should be stopped. Share your views with The Progress Report!
Here are highlights from a recent latinamericapress.org article circulated by oneworld.net
by Barbara J. Fraser
It took José Dispupidiwa Wasi a week to travel from his community to Lima, Peru’s capital. Dispupidiwa Wasi is the curaca or traditional chief of the Nahua community of Serjali, deep in the jungle of southeastern Peru. With four other community authorities, he made the journey about five days by river and two over the Andes on a bus to seek government-recognized title to his peoples ancestral lands.
The trip follows up letters that the Nahua leaders sent to government officials earlier. We waited and waited for a reply, but it never came, said Jader Flore Gómez, president of the community of Serjali.
While the Nahua and other semi-nomadic groups are often referred to as being uncontacted, the word is a misnomer. Most have had some contact with the outside world, particularly with loggers or oil company workers. Abused or ill from diseases to which they had no resistance, they have fled deeper into the forest, their lives ever more precarious.
Because they shun contact with outsiders, there are no completely reliable statistics about these groups. But based on reports by anthropologists and health workers, as well as information from loggers and others who have had encounters with them, there are an estimated 10 to 15 groups in several parts of the Peruvian rainforest.
Even their isolation is relative, however. During the rubber boom of the early 1900s, many indigenous people in the Amazon were enslaved by adventurers and rubber barons.
When the oil giant Shell began working in Camisea, near the Urubamba River, in the 1980s, its workers reported contact with nomadic indigenous people. Roads and paths built by the company also allowed illegal loggers and speculators to enter the area, bringing diseases some as simple as the flu or a cold to which the Nahua people, also known as the Yora, had no resistance.
The result, according to Vladimir Pinto of the Pro Human Rights Association of Lima, was practically a genocide. Experts estimate that between 40 percent and 70 percent of the Nahua died.
In an effort to avoid similar disasters, in 1990 the government established the Kugapakori-Nahua Reserve to protect nomadic people living in isolation and those who were in the initial stages of contact. With their family groups decimated, many of the surviving Nahua settled down, establishing the community of Serjali on the river of the same name in Ucayali Department in central-eastern Peru.
The reserve, which is administered by the government, was originally meant to be temporary, providing protection until the indigenous groups living within its boundaries established settlements and claimed title to their own territories.
The 260 families living in Serjali are the first to do so. During their visit to Lima in mid-November, the community leaders asked for title to 180,000 hectares, almost 40 percent of the 457,435-hectare reserve. That in itself creates a dilemma.
What worries us is that this might mean dissolving the reserve at a very critical moment, when there various types of pressure are being brought to bear on the indigenous people living there, Pinto said.
Several other groups including other Nahua, some Nanti and possibly a group of Machiguenga families still live a nomadic life within the reserve. It is not clear whether their wanderings take them into the land that the residents of Serjali are claiming, Pinto said. If they do, titling the land could constitute an infringement of their rights.
The Nahuas situation is very unusual and comes after a traumatic process of contact. We cant forget that and simply say theyre a community that wants a land title. Thats their right but it needs to be done in such a way that the rest of the peoples in the reserve are not affected, Pinto says.
Peru has set aside five reserves for nomadic indigenous people. Because they are protected, they often contain the last stands of valuable mahogany. As a result, they are attractive to loggers who enter the areas illegally. As of August 2001, 16 groups of illegal loggers were reported to be working inside the land the Nahua are claiming as their territory. By June 2002, they had cut 600,000 cubic feet of mahogany and cedar, according to Shinai Serjali, a non-governmental organization that works with the Nahua of Serjali.
Another difficult issue is the Nahua request to be allowed to selectively cut trees inside the reserve on the land they claim as their territory. Except for Camisea, commercial use of natural resources in the reserve is currently prohibited. Some observers worry that if the Nahua are allowed to cut and sell timber, it could set a precedent for illegal seizure of resources in other protected areas.
The Nahua argue that since disease and decimation forced them to settle in Serjali, contact with the outside world has created a series of new needs, some of which must be met with cash.
My community needs everything there are no notebooks or pencils for the children, no machetes, axes, pots or pans, Dispupidiwa Wasi says.
Logging is not the only threat. Three of the wells in the Camisea gas field lie inside the Nahua-Kugapakori Reserve and the petroleum concession known as Lot 57, which is currently open for bids, overlaps the protected area. The indigenous leaders who visited Lima won a promise from the government to exclude the reserve from Lot 57. If the community gains its title, that would mean it would no longer fall within the reserve. In that case, Pinto said, the territory may once again fall within the lot.
Theyd be the owners of their territory, and they could negotiate with the company that takes over Lot 57, but we know how that has gone in other parts of the Peruvian and Ecuadoran Amazon, Pinto says.
What a mess! The Western concept of land ownership seems to push some plain, simple human beings into a thicket of complications. And it’s not their fault. What do you think is the best way forward out of this situation? Tell your views to The Progress Report!
Thanks to our friends at evworld.com for announcing this article, which appeared originally in the Corvallis Gazette-Times of Oregon.
by Paul F. deLespinasse
Nobody knows exactly how much the United States has spent so far on the war. [But try http://costofwar.com for the best, most careful research on this.] Meanwhile, it is a fact that Congress recently appropriated an extra $87 billion to support military operations for another year and rebuild Iraqi infrastructure.
Much of this money is now “sunk costs,” and we can’t “unspend” it. But the question naturally arises whether there might have been alternate projects on which this money could be spent, and whether these projects might have contributed more to U.S. national security than overturning Saddam Hussein will do. Our answers to these questions might provide guidance in deciding on future U.S. foreign policy.
News reports about a projected wind farm in northeastern Oregon illustrate one interesting possibility here. Officials at Alpine Power Co. of Roseburg want to spend $23 million to install 51 windmills near La Grande. Altogether, these windmills would generate some 92 megawatts of electricity. Assuming that they could be run about one third of the time (full windpower is not always available), each windmill would produce about 5265 megawatt-hours of electricity per year.
How many windmills could we have built and how much pollution-free electricity could be generated by those windmills if we could have used just the extra $87 billion that was recently appropriated for Iraq?
At the costs projected by Alpine Power Co, $87 billion would buy 192,904 windmills. The total resulting electricity production, again assuming each windmill can run one third of the time, would come to more than 1,015 billion kilowatt-hours per year. This amounts to more than a quarter of all U.S. electricity consumption in 2000.
In 2000, burning coal generated 52 percent of our electricity. More than18 percent came from oil and natural gas, and about 20 percent came from atomic power stations. Burning coal, oil and gas puts carbon dioxide into the atmosphere, which may contribute to potentially catastrophic global warming.
Atomic power stations pose their own problems (including the need for long-term storage of atomic waste) and may be attractive targets for terrorists.
Imported oil swells the U.S. balance of payments problems, puts large sums into the hands of dubious foreign regimes and some of the money even gets diverted to supporting terrorist organizations.
Energy produced by one method often can substitute for energy from other sources. A great increase in electricity produced by windmills could reduce our dependency on hydrocarbon fuels and imports and increase our economic, military and environmental security.
Taking the world as a whole, windmill-generated electricity has been going up about 30 percent each year since 1995. It is beginning to become a serious business in many countries including the United States. But investing an extra $87 billion now and then could accelerate this desirable process considerably.
The fictional hero Don Quixote went around Europe “tilting at windmills,” a phrase that has become synonymous with engaging in noble but unrealistic efforts. However, building real windmills just might be worth thinking about. As we consider the opportunity, compare it to the cost of attacking and occupying Iraq, and the uses to which we could otherwise have put that money.
Paul F. deLespinasse of Corvallis is professor emeritus of political science at Adrian College in Michigan.
Some politicians still have not learned the most important lesson of 9/11 — that the U.S. must shift away from dependence on foreign oil. Share your views with The Progress Report!
My forecast is a severe depression at the end of this decade.
Economies experience fluctuations of different causes and duration. There are random shocks that cause national output to rise and fall irregularly. But there are also regularities that create business cycles with similar patterns.
The recession of 2001 had four causes. First, there was the technology boom of the 1990s, which got carried to unsustainable speculative heights. Second, there was a gush of money created by the Federal Reserve Fund which became channeled into higher asset prices (stocks and real estate) rather than the price of consumer goods. Third was the fraud and abuse of corporations, stock brokers, mutual fund companies, and stock exchanges, a systematic corruption of the financial markets rather than merely isolated cases. Fourth was the September 11 attacks, with its devastating losses, followed by the costly War on Terror.
While some industries such as airlines sharply declined, the economy as a whole did not suffer that much. Stock prices fell, but were still historically high. Unemployment fell, but not as much as in some previous depressions. One main reason why the economy was able to keep chugging along was the booming real estate market, which kept on rolling despite all these troubles. Another reason was that the Federal Reserve flooded the financial markets with money in order to keep short-term interest rates at historically low levels. The federal tax cuts also helped the economic recovery, stimulating labor, enterprise, and investment. The huge federal budget deficit also provides short-term stimulation of demand by borrowing money from abroad.
Now that the economy is recovering and growing, what lies ahead? To see what is coming, we need to understand the most important cycle in the economy, the real estate cycle. Historically, the United States has experienced a real estate cycle with a period of about 18 years. Real estate prices and construction have peaked before the general downturn in the economy. As the economy booms, speculators buy real estate expecting even higher prices later, until real estate becomes priced too high for current uses. Investment therefore falls, leading to a recession.
The real estate cycle is fueled by money expansion. During the depression, the bottom of the cycle, the Federal Reserve system targets low interest rates, which requires a large expansion of the money supply. This artificial stimulation is unsustainable because they make large-scale projects such as shopping centers and office buildings look profitable, but later, prices and interest rates rise due to the monetary expansion, and many projects turn out to be losers.
Excessive monetary expansion creates long-term distortions that lead to bad investments and higher prices that later choke the economy and cause it to crash. Borrowers default on loans, leading to bank failures and a financial crisis. Less investment and financial failures result in layoffs that then reduce overall demand and lead to more contraction, and down we go.
The last real-estate-related recession started in 1990. Count 18 years forward, and we get to 2008, but because of the 9/11 attacks which made the 2001 recession worse, the next recession could start a bit later, such as 2009 or 2010. The exact year of the next depression cannot be predicted, but the economy today is following the typical pattern of real estate cycles, so we are very likely to have the recession in the last years of this decade, sometime from 2008 to 2010.
As the economy expands, inflation is likely to return, and interest rates will also rise. Rising interest rates and prices, especially for real estate, will choke investment, and the recession follows. Investment drives the cycle, and real estate drives most of investment. Meanwhile, there is a colossal trade deficit, paid for by selling US assets, including treasury bonds. If foreigners slow their buying of US debt, that will jack up interest rates even higher. The US federal budget deficits, at astonishingly record levels, are unsustainable and will do long-term damage as Americans get drained of funds and resources to pay the interest to foreigners.
Towards the end of the ozos (the 2000 decade) the baby boomers will begin to retire. Those born in 1946 turn 65 in 2011. This is an inevitable demographic financial calamity, as there will be more and more folks retiring in the next decade, collecting social security and medicare, with proportionately fewer workers to finance it. The day of reckoning will be unpleasant – whether from sharply higher taxes, truncated benefits, default, or high inflation. This will become ever more visible as we come to the end of the decade, deepening the depression of 2008-2010.
The only effective remedy is politically impossible, because not one person in a hundred has any clue about the economic realities. The remedy is to tap the land rent of the country for public revenue. That would halt the speculative escalation of land prices. It would finance the baby boomer demographic transition. It would eliminate the federal budget deficit. It would prevent interest rates from rising too high, and reduce the demand for excessive monetary expansion.
Land does not get produced, and its value comes from nature and community and public works, so tapping it for government revenue does not hurt enterprise, unlike taxes on wages and sales. No constitutional changes are needed; indeed the federal government several times taxed real estate as a direct tax prior to the civil war. The US federal government paid for the War of 1812 mostly by taxing land value. They could do it again, to avert the fiscal and economic crisis.
But they wont. The public is not demanding it. We are dancing on the Titanic. The economic ship is now full steam ahead. Few see the waterfall beyond the immediate horizon. Even most economists are clueless. You have now been warned, but most who read this will not really believe it. Most of those who believe it will do nothing about it. Thats why the cycle will run its course, and it may be a worse economic disaster than the Great Depression of the 1930s.
Copyright 2004 by Fred E. Foldvary. All rights reserved. No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, which includes but is not limited to facsimile transmission, photocopying, recording, rekeying, or using any information storage or retrieval system, without giving full credit to Fred Foldvary and The Progress Report.
Thanks to our friends at evworld.com for circulating this information.
In the December 2003 issue of Scientific American, John P. Holden reviews Vijay Vaitheeswaran’s new book, “Power To The People.” If you’re short on time, here’s a quick synopsis that Holden considers, “the critically important points” developed in the book.
Civilization is in no immediate danger of running out of energy or even just out of oil. But we are running out of environment — that is, out of the capacity of the environment to absorb energy’s impacts without risk of intolerable disruption — and our heavy dependence on oil in particular entails not only environmental but also economic and political liabilities.
Choices that countries make about energy supply commit them to those choices for decades, because power plants and other energy facilities typically last for 40 years or more and are too costly to replace before they wear out. This is one of the reasons it is imprudent in the extreme to wait for even more evidence than we already have before letting climate-change risks start to influence which energy options we choose.
Energy technologies that exist or are under development could greatly increase energy efficiency in residences and businesses, reduce dependence on oil, accelerate the provision of energy services to the world’s poor, increase the reliability and resilience of electricity grids, and shrink the impacts of energy supply on climate and other environmental values. The most promising of these options include renewable sources of a variety of types, advanced fossil-fuel technologies that can capture and sequester carbon, and hydrogen-powered fuel cells for vehicle propulsion and dispersed electricity generation.
These prosperity-building, stability-enhancing and environment-sparing options will not materialize in quantity matching the need unless and until three conditions are met: The massive subsidies favoring continuation of energy business as usual must be ended. The massive risks of greenhouse gas-induced climate change must be at least partly internalized with a carbon tax or its equivalent. And the industrial nations must commit to helping the developing ones “leapfrog” past the inefficient and dirty-energy technologies that fueled the industrialization of the former but mortgaged the environment in the process.
The author also has his own web site at http://www.vijaytothepeople.com.
Will politicians understand how to make long-term decisions and shift away from dependence on oil? How many current politicians “get it”? Share your views with The Progress Report!
I keep mentioning Waldo County. Perhaps it’s time to tell you a bit about the place. We live in Central Maine, in a little township called Jackson. It used to have a school, a post office and a mill; it has none of those things now, but the mill pond survives, at any rate, and provides a lovely spot for a flock of Canada geese to return to each year (a roadside sign emerges each spring: SLOW: WILD GEESE). Jackson’s population has been essentially stable since its founding around the turn of the nineteenth century. It just won’t really support any more people, and folks are fine with that — new residences are to be built on plots of no less than two acres. Along a mile-long stretch of Hadley Mill Road there are junkyards, logging operations, trailers, horse farms and nice new homes.
The land here is rolling and rocky. It is exquisite in the fall (as you can see from the logo, above: those sugar maples are right here on our farm). The spring is nice, too, when it finally comes — except that the month of May is given over to blackflies. (Unlike the silly Europeans who must plant gardens, the native Wabanakis didn’t put up with such nonsense. They waited out blackfly season at the seashore, dining on copious blooms of shellfish.) When the growing season finally comes along, there is a headlong rush of green things trying to get their growing in before the freeze returns. The farmable land is being farmed, but it is exceedingly difficult to make a living by farming around here; to do it one must have the best land, plenty of capital and be willing to work in the cold.
For, friends, it does get cold in Maine. I’m not born and raised here, but my kids are, and I’m constantly telling them to at least put on shoes, before going out to run across the frost-crispy grass. I have come to treasure Garrison Keillor’s tales of the plucky fatalism of Minnesotans as they beat their weary way through beastly cold, year after year — it’s like that around here, too. It’s cold. There’s a great deal of snow. The days are very, very short; the nights are long, and we survive it however we can, and feel better, tougher, more in touch, for its being that way.
My wife’s parents bought this farm about twenty years ago. They took what money they had, and kept driving north and west until they found a farm they could afford. They raised sheep on it for most of that time. It was never enough to make a living (property taxes and medical bills were their major stumbling blocks), but their local farmers’ market income supplemented their pensions and made them some good friends. When we started a family, they offered us a piece of land — free land! — to build on. Well, we enjoyed life in New York City — but we could see right away that we weren’t going to enjoy the two full-time jobs we would need, as a family in NYC, to make ends meet. So, when our son was two months old, we packed up and set out for the Margin.
I use that term, because for many years I’ve been a student and teacher of Georgist political economy, and in that, “the margin of production” — the best land that is available for free — is a very important concept. The “Margin” is where — to make a long story short — unskilled workers can go to make a living for themselves. Whatever they can earn there, working for themselves, becomes the lowest wage they will accept to work for anyone else.
However, to most people who study economics today, this “Margin” is only a concept — for where is this free land on which workers can make a living? There’s none, anywhere! Even a rugged place like ours demands a mortgage to acquire it, and annual tax payments to retain it — not to mention the tax burdens imposed on everything we buy, sell or build. (A number of the homes in Jackson have been lived in comfortably for years, without being sided, to avoid the local tax increase when the home becomes “finished”.) Nowadays the notion of “free land” is nothing more than a bygone, romantic notion.
Or is it?
The Georgist “Remedy” — getting public revenue from the rental value of land and natural resources, and abolishing all other taxes — promises to create a healthy incentive to put valuable land to use. It would reverse the process or urban sprawl, leading to “infilling” and efficient resource use. Among other benefits, the resulting drop in overall vehicle-miles would be very good for the environment. And, applied to its full extent, the Georgist remedy (also known as the “Single Tax”) would do one more thing, which may be the most important of all. It would create free land. That might not seem possible where you are — but, from my vantage point in Waldo County, it’s as plain as the nose on your face.
Look at the unused or grossly under-used land in every city today. How many people could live and work on those plots of land? They are already provided, after all, with streets, sewers, police and fire protection, public transit and schools. Look at all the egregious waste of land in every suburban community, look at all the acres upon acres covered by the roads the soccer moms must travel on in their SUVs. Look at the farmland being gobbled up by new suburban sprawl.
Now. Imagine that process being reversed. Cities efficiently used, people moving via clean, green public transportation, the sprawl-plague halted, inner cities no longer places of fear and loathing, farms on the cities’ edges no longer gobbled up by subdividers.
But even in such a society, rugged individualists like my in-laws might want to chuck the rat race and settle on a sheep farm in a stoic place that makes them feel better, tougher, more in touch, for its being that way. Well, here’s the good news, folks: in an efficient, fair Georgist economy, rugged land like ours would have no market value. None. It would be free for the taking.
Can you imagine? But now, you may ask, wait a minute, what about the infrastructure that we pay for now out of our property taxes? Well, you could look at the question in two ways. On the one hand, folks who lived in such places might voluntarily pool their resources to get such jobs done, as people have always done in frontier communities.
On the other hand, though, I don’t think that is how it would go down in today’s world. After all, we’re not talking about a frontier community in the untamed wilderness, lacking all the benefits of human community. Not at all. I mean, as rugged as I claim it to be, we do have power, phone, internet access, shopping malls, washer’n’dryers, public schools, y’know, that kind of stuff. What I’m envisioning here is a frontier community being reclaimed out of the existing overburdened, overtaxed civilization. And that would create so many advantages, in so many ways, for the overall economy, that it would benefit everyone to provide for the meager public needs of us folks out in the sticks.
I mean, look at it this way: right now, we’re already paying for rural infrastructure. But we’re also paying, in all manner of expensive, indirect and clumsy ways, the social costs of poverty. Hey! Suppose poor people could have free land in Jackson, Maine, and a thousand other rugged communities like it, across this huge land of ours! Just chipping in for a few rural schools, highways and snowplows would be a heck of a cost-effective anti-poverty program.
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 heritage 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 dividend, as Tom Paine suggested, and taxes (except any on natural rents) could be abolished, as Thomas Jefferson suggested. Were we sharing Earth by sharing her worth, territorial disputes would be fewer, less intense, and more resolvable.
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. Better settlement patterns do reduce extraction upstream and pollution downstream.
Politically, green fees have less impact if applied locally; local is where grassroots movements have more impact. Yet getting rent usually entails shifting the property tax (or charging user fees), the province of local jurisdictions; both mayors and city voters have been known to adopt a site-value tax.
Ethically, putting into practice “tax bads, not goods” skirts the issue of sharing Mother Earth which collecting rent confronts head on. Since nothing is fixed until it’s fixed right, ultimately, greens must lead humanity into geotopia where we all share the worth of Mother Earth.
a discipline that, compared to economics, is as obscure as Warren Buffett’s investment strategy, compared to conventional investment theory, about which Buffett said, “You couldn’t advance in a finance department in this country unless you taught that the world was flat.” (The New York Times, Oct 29). The writer wondered, “But why? If it works, why don’t more investors use it?”
Good question. Geonomics works, too. Every place that has used it has prospered while conserving resources. Yet it remains off the radar of many wanna-be reformers. Gradually, tho’, that’s changing. More are becoming aware of what geonomics studies – all the money we spend on the nature we use. Geonomics (1) as an alternative worldview to the anthropocentric, sees human economies as part of the embracing ecosystem with natural feedback loops seeking balance in both systems. (2) As an alternative to worker vs. investor, it sees our need for sites and resources making those who own land into landlords. (3)As an alternative to economics, it tracks the trillions of “rent” as it drives the “housing” bubble and all other indicators. And (4) as an alternative to left or right, it suggests we not tax ourselves then subsidize our favorites but recover and share society’s surplus, paying in land dues and getting back “rent” dividends, a la Alaska’s oil dividend. Letting rent go to the wrong pockets wreaks havoc, while redirecting it to everyone would solve our economic ills and the ills downstream from them.
People must learn to stop whining so much and feel enough self-esteem to demand a fair share of rent, society’s surplus, the commonwealth.
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!
a manual. The world did not come without a way for people to prosper, and the planet to heal and stay well; that way is geonomics. Economies are part of the ecosystem. Both generate surpluses and follow self-regulating feedback loops. A cycle like the Law of Supply and Demand is one of the economy’s on/off loops. Our spending for land and resources – things that nobody made and everybody needs – constitutes our society’s surplus. Those profits without production (remember, nobody produced Earth) can become our commonwealth. To share it, we could pay land dues in to the public treasury (wouldn’t oil companies love that?) and get rent dividends back, a la Alaska’s oil dividend. Doing so let’s us axe taxes and jettison subsidies. Taxes and subsidies distort price (the DNA of exchange), violate quid pro quo by benefiting the well-connected more than anyone else, reinforce hierarchy of state over citizen, and are costly to administer (you don’t really need so much bureaucracy, do you?). Conversely, land dues motivate people to not waste sites, resources, and the ecosystem while rent dividends motivate people to not waste themselves. Receiving this income supplement – a Citizens Dividend – people can invest in their favorite technology or outgrow being “economan” and shrink their overbearing workweek in order to enjoy more time with family, friends, community, and nature. Then in all that free time, maybe we could figure out just what we are here for.
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.
shaped by reality. In the 1980′s, the Swedish government doubled its stock transfer tax. Tax receipts, however, rose only 15%, since traders simply fled to London exchanges. Fearing a further exodus, the Swedish government quickly rescinded the tax altogether. (The New York Times, April 20) That willingness to tax anything leads us astray. Pushing us astray is that unwillingness to pay what we owe: rent for land, our common heritage. Assuming land value is up for grabs, we speculate. We cap the property tax on both land and buildings and the rate at which assessments can go up; while real market values rise quicker, assessments can never catch up. Our stewards, the Bureau of Land Management, routinely sell and lease sites below market value, often to insiders, says the Government Accounting Office. Once we grasp that rent is ours to share, we’ll collect it all, rather than let it enrich a few, and quit taxing earnings, which do belong to the individual earner. That shift is geonomic policy.
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, in-cluding 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 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.
an answer for Jonathan of the Green Party (Nov 7): “What does ‘share our surplus’ mean?”
Our surplus is the values that society generates synergistically. It’s the money we spend on the nature we use: on land sites, natural resources, EM spectrum, ecosystem services (assimilating pollutants). It’s also the money we pay to holders of government-granted privileges like corporate charters. We could share it by paying for the nature we use and privileges we hold to the public treasury then getting back a fair share of the recovered revenue. Used to be, owners did owe rent (“own” and “owe” used to be one word). And presently, some lucky residents do get back periodic dividends: Alaska’s oil dividend and Aspen Colorado’s housing assistance. Doing that, instead of subsidizing bads while taxing goods, is the essence of geonomics.
Jonathan: “Is local currency what you mean?”
Editor: It’s not. Community currency is a good reform, but every good reform pushes up site values. That makes land an even more tempting object of speculation. Now, any good will eventually do bad by widening the income gap – until you share land values.