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This 2014 excerpt of The Intercept, Oct 20, is by Murtaza Hussain.
The head the NSA’s Signals Intelligence Directorate, Teresa O’Shea, is married to the Vice President of DRS Signal Solutions – a company which circumstantial evidence suggests was the beneficiary of significant contracting work from the agency.
In addition to her work at the NSA, O’Shea might be a successful businessperson in her own right: Another company is based at the Shea residence, called Oplnet LLC.
If top NSA officials are apparently spending their time running secret side-businesses, it’s going to be difficult for them to focus on their day jobs … unless the two jobs are one and the same.
Ed. Notes: The NSA can not spy on citizens or do anything at all without money, money it gets from Congress, money that Congress gets from taxpayers. To end this gravy train, we could deprive Congress of both discretionary spending and discretionary taxing. Replace most spending with a Citizen’s Dividend and replace most taxes with fees for services, leases of public resources, and dues for membership in society. Without the power to tax and spend any way they want, no longer able to grant favors to insiders, politicians will walk away from their jobs of governing everyone else, making room for true statesmen who could pass policies that benefit all.
This 2014 excerpt of the Daily Mail, Oct 14, is by Harriet Arkell.
In London’s Mayfair, one of the capital’s most exclusive, and expensive, districts, eight parking spaces go on sale for £2.25m – making each one more expensive than the average UK home.
Price equates to £281,000 per space — eight, as long as they are not for the billionaire’s favourite Maybachs. One space goes for more than £274,000, the price for an average house.
The spaces are on a tarmac-covered forecourt under a block of flats. The forecourt is open to the elements. They don’t offer much in the way of security for any expensive cars parked there – there is just a metal chain skirting the forecourt’s boundary.
The spaces are close to the heavily-guarded US Embassy and Berkeley Square.
Estate agent Carter Jonas is selling a 900-year lease on the outdoor parking spaces. And given that it is merely a lease on the parking spaces that is being sold, the new owner will still have to pay £100 a year in ground rent.
Ed. Notes: Extremely pricey land in a world capital is to be expected. What would make this phenomenon perfect would be if the surrounding society were to be the one to receive the payment for the land. Nobody makes land, everybody needs land, and the population density is what makes the land valuable. Sharing this surplus, all members of society could benefit from the boom in location value — benefit so much that it should be possible to “geonomize”, to lose most taxes and subsidies.
This 2014 excerpt of the Daily Beat, Oct 19, is by Jamie Dettmer.
While U.S. warplanes strike at the militants of the so-called Islamic State in both Syria and Iraq, truckloads of U.S. and Western aid has been flowing into territory controlled by the jihadists, assisting them to build their terror-inspiring “caliphate.”
The aid—mainly food and medical equipment—is meant for Syrians displaced from their hometowns, and for hungry civilians. It is funded by the U.S. Agency for International Development, European donors, and the United Nations.
The aid convoys have to pay off ISIS emirs (leaders) for the convoys to enter the eastern Syrian extremist strongholds of Raqqa and Deir ez-Zor. The kickbacks are either paid by foreign or local nongovernmental organizations tasked with distributing the aid, or by the Turkish or Syrian transportation companies contracted to deliver it, providing yet another income stream for ISIS militants, who are funding themselves from oil smuggling, extortion, and the sale of whatever they can loot, including rare antiquities from museums and archaeological sites.
Some aid is sold off on the black market or used by ISIS to win hearts and minds by feeding its fighters and its subjects. At a minimum, the aid means ISIS doesn’t have to divert cash from its war budget to help feed the local population or the displaced persons, allowing it to focus its resources exclusively on fighters and war-making.
“There is always at least one ISIS person on the payroll; they force people on us,” says an aid coordinator. “And when a convoy is being prepared, the negotiations go through them about whether the convoy can proceed. They contact their emirs and a price is worked out. We don’t have to wrangle with individual ISIS field commanders once approval is given to get the convoy in, as the militants are highly hierarchical.” He adds: “None of the fighters will dare touch it, if an emir has given permission.”
That isn’t the case with other Syrian rebel groups, where arguments over convoys can erupt at checkpoints at main entry points into Syria, where aid is unloaded from Turkish tractor-trailers and re-loaded into Syrian ones.
While aid is still going into ISIS-controlled areas, only a little is going into Kurdish areas in northeast Syria.
Ed. Notes: Do you really want the people with cushy government jobs spending your hard earned money? If so, it should come immediately from federal income taxes, not one penny from borrowing, so pro-war people can feel the cost and so all taxpayers can consider if another war is worth it.
This 2014 excerpt of Gates Notes, Oct 13, is by Bill Gates, the richest private person on Earth.
I Skyped Thomas Piketty, author of Capital in the Twenty-First Century. I agree with his most important conclusions and hope more smart people will study wealth and income inequality because the more we understand about the causes and cures, the better.
High levels of inequality are a problem, messing up economic incentives, tilting democracies in favor of powerful interests, and undercutting the ideal that all people are created equal.
Capitalism does not self-correct toward greater equality —- that is, excess wealth concentration can have a snowball effect if left unchecked.
Governments can play a constructive role in offsetting the snowballing tendencies if and when they choose to do so.
I fully agree that we don’t want to live in an aristocratic society in which already-wealthy families get richer simply by sitting on their laurels and collecting “rentier income”: the returns people receive when they let others use their money, land, or other property.
I agree that taxation should shift away from taxing labor. Taxing labor will make even less sense in the coming years, as robots and other forms of automation come to perform more and more of the skills that human laborers do today. But rather than move to a progressive tax on capital, as Piketty would like, I think we’d be best off with a progressive tax on consumption.
Philanthropy also can be an important part of the solution set.
Ed. Notes: According to another Bill — Domhoff at UC Santa Cruz — America too endures an aristocracy, just like everywhere else. Rockefeller oil money founded the Council on Foreign Relations, which provides the US with its foreign policy, helped fund the U of Chicago which provides the US with its neoliberalism, etc. The Ford Foundation has not been idle, either.
And philanthropy is not giving money away but giving it to friends and associates who do with it as directed … for a pretty tax write-off, too.
Bill Gates adding his voice to the call to de-tax labor helps win that goal. But hopefully it’ll backfire on winning more sales taxes or a VAT. The consumption to tax — or to fine or fee — is not downstream, not a good or service, but well upstream.
One set is natural: land, natural resources, EM spectrum, ecosystem services such as the atmosphere performs, etc. The other set is political: utility franchises (enriching telecomms unduly), patents and copyrights offered for the same fee no matter the value of the idea protected (imagine an insurance company doing that!), corporate charters and other limits on liability, such as the special act of Congress, a gift to Gates, when Y2K was a scare, banking charters that legalize counterfeiting by the (not really) Federal Reserve, etc.
Run government like a business. Get full market value for all these little pieces of paper that government grants. Then you can forget about taxing either labor or capital, luxuries (as phones initially were) or waste. Just recover the values that society generates without anyone’s labor or capital involved — the values of earth and of privilege. Inequality will be slashed to human-scale.
These six excerpts on the very rich owning very muchly desired land are from two different years. In 2012, (1) Forbes, Nov 29, on Kroenke by Morgan Brennan; (2) Billings Gazette, Dec 13, on Wilks by Brett French. In 2014, (3) Pacific Business News, Jan 10, on Kelley by Duane Shimogawa; (4) CNN, May 13, on Khosla; (5) Pacific Business News, Spt 26, on Zuckerber, by Duane Shimogawa; and (6) Wall St Jrnl, Oct 8, on Gates, by Candace Taylor.
Billionaire Stan Kroenke Buys $132.5 Million Broken O Ranch
Stanley Kroenke, a real estate mogul worth $4 billion, bought Broken O Ranch for an undisclosed price. Asking price was $132.5 million. Kroenke is owner of the NBA’s Denver Nuggets, the NHL’s Colorado Avalanche, the NFL’s St. Louis Rams, and the Premier League soccer club Arsenal. His wife Ann is daughter of Bud Walton, co-founder of Wal-Mart; she has her own $4.5 billion. Wal-Marts anchor Kroenke’s shopping centers. He and Ann primarily reside in Columbia, Mo.
The 124,000 acre Montana farm was assembled over the course of nearly 25 years by the late founders of the Kelly-Moore Paint Company. It stretches 20 miles along the Sun River and spans three counties. It’s the largest irrigated farm in the state of Montana, boasting extensive water rights. Annually, it produces 700,000 bushels of small-grain crops and 25,000 tons of alfalfa hay. One of the top commercial cattle operations in the Rocky Mountains, its livestock includes 3,500 “mother” cows, 800 replacement heifers and 175 range bulls.
There’s a 10,000-square-foot main house that overlooks the river and the Rocky Mountains. It has an indoor swimming pool. Recreational activities on the sprawling compound include trout fishing, hunting and wildlife viewing.
In most states, fully-operational ranches like Broken O have welcomed double-digit appreciation every year, save 2009.
Prior to this purchase, Kroenke’s personal portfolio held an estimated 740,000 acres’ worth of U.S. real estate, making him the 10th largest landowner in America. With the addition of Broken O’, he is now the eighth largest in the country. At 864,000 acres, his holdings still trail million-plus-acre owners like John Malone, Brad Kelley (below), and Ted Turner.
Two Texas billionaire brothers have quietly collected more than 177,000 acres of ranch land in the last two years. They are now the second-largest landowner in Idaho County. On a bluff across Flatwillow Creek from their new N Bar Ranch headquarters, they are building a 6,000-foot asphalt airstrip.
The BLM owns about 2,500 acres in the Durfee Hills that are landlocked within the N Bar with no road access.
N Bar is only a portion of the property that Farris, 60, and Dan Wilks, 56, have accumulated in Montana. In all, they own more than 276,000 acres in seven counties in the eastern half of the state. That’s 431 square miles.
Another landowner the Wilks brothers have bought out is Theodore Roosevelt IV, who had a log lodge, timber and grazing land between the south and north forks of Flatwillow Creek. They also bought property from the Sunlight Ranch Co., owned by Earl Holding of Sinclair Oil.
In 2002, Dan and Farris Wilks started Frac Tech; fracking is a way to recover oil by injecting fluids underground under high pressure. They sold their interest in 2011 for $3.2 billion. They landed on the Forbes magazine list of little-known billionaires, ranking 312 out of 400 on the list.
The brothers may be looking for their next oil play in central Montana. Or like other wealthy individuals, they are parking their money in a safe investment during a volatile time in the stock market.
Wilks brothers own land in Wyoming, Kansas, Texas, and Idaho. In Colorado, Farris Wilks paid $16 million for the most expensive ski-accessible home in Snowmass Village — a seven-bedroom home on five acres in the ski town.
Tennessee Billionaire Buys 1000s of Acres on Kauai
Billionaire Brad Kelley purchased “thousands of acres” of agricultural land in Hawaii on the island of Kauai from landowner Grove Farm, which is owned by AOL founder Steve Case.
One of the largest private landowners in the United States, Kelley has more than 1.5 million acres of ranch lands in Kentucky, Tennessee, New Mexico, Florida, and Texas. His massive landholdings amount to about 1,600 square miles, more than the entire land area of Rhode Island and not that much less than the state of Delaware.
The 57-year-old Kentucky native, who has a net worth of $2 billion, ranking him at No. 273 on the Forbes 400 list, gained such wealth by starting discount cigarette brands Bull Durham and USA Gold, eventually selling the business for $1 billion in 2001.
Additionally, Kelley, who lives in Franklin, Tenn., south of Bowling Green, Ky., purchased the well-known Calumet Farm in Kentucky about two years ago, which produced the 2013 winner of the Preakness, Oxbow.
Grove Farm, the 10th largest landowner in Hawaii and third largest on Kauai with 33,294 acres, recently partnered with eBay founder and billionaire Pierre Omidyar’s Ulupono Initiative to build a grass-fed dairy farm on the south side of the Garden Isle on 583 acres of pasture land that it owns.
Kelley’s purchase marks a similar transaction by another billionaire — Oracle Corp. CEO Larry Ellison — who in 2012 bought the majority of the island of Lanai, which amounts to about 87,700 acres.
Is Facebook’s Mark Zuckerberg Buying a Hawaii Beachfront Estate?
Facebook founder and CEO Mark Zuckerberg is the likely buyer of a 357-acre beachfront estate on the Hawaiian Island of Kauai’s North Shore. The likely sales price is $66 million. It is fully entitled for 80 homesites with approved roads.
Zuckerberg, who has a net worth of $34.7 billion, is the 13th richest man in the world, according to Forbes.
Zuckerberg has had an appetite for Hawaii real estate with the apparent purchase of several multi-million-dollar units in a 23-story ultra-luxury condominium under development called ONE Ala Moana. This happened after both Zuckerberg, 30, and his wife, Priscilla Chan, were photographed over the 2012 holidays in Hawaii, walking around town, eating hamburgers, and surfing.
Bill Gates Buys Jenny Craig’s California Horse Farm for $18 Million
Bill Gates, the Microsoft co-founder, has purchased weight-loss guru Jenny Craig ’s Rancho Santa Fe, Calif., equestrian estate. Known as Rancho Paseana, the approximately 228-acre property is about 20 minutes north of San Diego. The price was $18 million.
The Gates family has enjoyed visiting the San Diego area with friends and family for many years. Gates’ daughter Jennifer is active in horseback riding. The ranch includes a ¾-mile racetrack, a guesthouse and an office, an olive orchard, five barns and a veterinarian’s suite.
The property took long to sell because Craig wanted a buyer who would keep it as a horse facility, though she received many offers from potential purchasers who wanted to develop the land.
Ed. Notes: Like others above, Gates also owns an island, Grand Bugue Island, the largest in the republic of Belize. Even more than do rich businessmen, many American entertainers also own islands, such as Eddie Murphy. Is it to get away from the paparazzi?
Note Kroenke got help from someone already rich. Wilks got theirs from our addiction to oil, a natural resource created by none of us, needed by all of us, at least until we get over our addiction and go solar. Kelley got his from our addiction to tobacco, grown on vastly subsidized farmland. Vinod Khosla, Zuckerberg, and Gates got theirs in IT where government-granted patents on monopolies are embarrassingly cheap (no business would sell its services so cheaply) and where government contracts proliferate, paying well above market rates. As is true with all fortunes, some of it is earned, most of it is not. There is simply no way that any individual can work hard enough or invest smart enough to own more than the value of the possessions of millions of other people also working hard and saving diligently.
However, it’d be OK if one person owned all the Earth — as long as s/he paid everyone else all the rent.
This 2014 excerpt of Forbes, Mar 4, is by Erin Carlyle.
The value of locations [the three most important things in real estate] are rising globally, creating new billionaires across the planet. Dubai, China, and Hong Kong saw the greatest annual rise in home+site prices, up 28.5%, 21.6% and 16.1% respectively. The total number of property tycoons on the FORBES Billionaires List [268 lucky individuals] rose to 135.
Fourteen of the top 20 hail from Asian-Pacific nations. Seven are from Hong Kong (three from the same family), four from China, two from Singapore, and one from Australia. Only six of the richest real estate 20 are Westerners: three each from the U.S. and the U.K.
Asian-Pacific countries are leading the world in terms of property fortunes, with 72. The U.S. ranks second with 29, the most of any country. Europe has the third-greatest number, with 21. Among individual nations, China has the second highest number at 21, followed closely by Hong Kong, with 18.
The wealthiest is Hong Kong’s Lee Shau Kee, ranking No. 35 among all billionaires with a fortune of $19.6 billion. His Henderson Land Development has a stake in Hong Kong’s iconic International Financial Center. His fortune dropped over the past year after the city’s hike in property taxes.
China’s richest landlord, Wang Jianlin, 59, is the third-richest person in China (No. 64 overall with a net worth of $14.8 billion). He is the oldest of five brothers born to a military family in western China’s Sichuan province, near the border with Tibet. His father fought for Mao Zedong’s Red Army during the Long March campaign in the 1930s, and later against the Japanese in World War II. Wang joined the People’s Liberation Army as a teenager and served for 16 years. He became chairman of the then-government-run Wanda in 1989, when he was just 35. Today he is chairman of China’s largest commercial real estate developer, Dalian Wanda Group.
He won the bid, beating more than 10 others, for a piece of land in Los Angeles, a 344,320 square foot plot in Beverly Hills, in order to enter Hollywood’s film industry. In 2012 Wanda bought the second-largest U.S. cinema chain, AMC Entertainment, for $2.6 billion. Like other Chinese companies, Wanda seeks to gain foreign expertise, brands, and technology.
America’s richest land baron is Donald Bren, No. 69 overall on the FORBES Billionaires list and the 4th-wealthiest property magnate with a net worth of $14.4 billion, mostly in California real estate. His Irvine Co. preserved half of the original 93,000-acre Irvine Ranch between Los Angeles and San Diego as permanent open space.
Ed. Notes: Note the role of government, how the Chinese army created a landholding company that an officer managed to take over. And the role of location, the need to be in LA to be in the movies. Also, as Hong Kong’s tax on land (and buildings) rose, the price of value of land there fell. That’s how a land tax or land dues makes land affordable — and of course anything built upon it.
It seems land is not irrelevant as some modern people believe. It still creates fortunes and political power. Expand the definition of land to include all natural resources, not just the planet’s surface, and you’d include the oil billionaires; the number of nature-related tycoons would grow.
Two things make land so profitable. One is we can’t do without it. Two is it costs nothing to make. Those two attributes are what land titles have in common with knowledge patents.
First, dependency. Once a piece of software becomes an institution — Microsoft, Facebook, for example — it’s hard to get by without it. The quandary is like when the width of railroad tracks became standardized, then any train with wheels of a different width was fenced out.
Second, cost. The fee for a patent on software that has become a standard and worth hundreds of billions is set by the government at the same amount as the fee on a patent for a new way of sending smoke signals.
In these two regards, IT billionaires are like landlords, and the number of moguls whose wealth is due to government assistance — not merely to clever investing of time or money — grows yet again.
If government did charge full market value for the patents and deeds it issues, fortunes would be much smaller, human-scale, reflecting actual work and wisdom contributed, while public treasuries would be filled with enough to pay citizens a dividend, as Singapore already does, despite putting two billionaires on the list above.
This 2014 excerpt of Computerworld, Oct 6, is by Patrick Thibodeau.
Gartner, a global leader in IT research and consulting, sees things like software, robots, and drones replacing a third of all workers by 2025.
Peter Sondergaard, Gartner’s research director, said in five years drones will be a standard part of operations in many industries, used in agriculture, geographical surveys, and oil and gas pipeline inspections.
Cognitive capability in software will extend to financial analysis, medical diagnostics, and data analytic jobs of all sorts.
For human workers, IT is a shift to new types of jobs.
CIOs have been steadily gaining authority, and 41% of 2,810 CIOs globally now report to the CEO, a record level.
Ed. Notes: Is this the right time to extend vacations and shorten the workweek? To achieve those goals, people better figure out how to receive an income apart from their work. And the way to do that is to get a share of society’s surplus.
What’s that? It’s all our spending for land and resources, which grow more costly as technology advances — see Silicon Valley. Land and resources do not require any labor to exist so there is no producer to compensate. People can pay for sites and resources to their community and the sites and resources will still be there, growing in value.
At the same time that government, on behalf of society, recovers the socially-generated value of land, it should also de-tax people’s efforts, to be fair. Out from under, while getting a Citizen’s Dividend, people will prosper quite nicely with robots doing much of the work.
This 2014 excerpt of Reader Supported News, Oct 10, is by Aaron Glantz of the Center for Investigative Reporting.
An internal Department of Education analysis obtained by The Center for Investigative Reporting, which was completed this summer but never publicly released, found:
In 2012, 133 small proprietary trade schools, ranging from Trendsetters of Florida School of Beauty & Barbering in Jacksonville to for-profit giants owned by publicly traded companies, including the University of Phoenix, Ashford University, Strayer University, and Colorado Technical University, received 92.5 percent of their revenue from taxpayers.
Taxpayers paid $9.5 billion to these for-profit colleges in 2012, including $8.8 billion from Pell Grants, Stafford Loans, and other financial aid programs administered by the Department of Education; $90 million from military tuition assistance; and $636 million from the Department of Veterans Affairs.
The University of Phoenix got $3.7 billion from taxpayers, accounting for more than a third of the $9.5 billion total. The for-profit college chain received $3.4 billion from the Department of Education, along with $32 million from the military and $206 million from the VA. The University of Phoenix is the largest recipient of taxpayer money under the post-9/11 GI Bill. Its San Diego campus alone got $95 million in GI Bill money, more than the entire University of California system and UC extension programs combined.
The school’s overall graduation rate is under 15 percent, and more than a quarter of students default on their loans within three years of leaving school.
In Congress, Rep. John Kline, R-Minn., the chairman of the House Committee on the Education and the Workforce, killed bills that would have turned off the spigot. Since he became chairman of the committee in 2011, the University of Phoenix’s parent company has been Kline’s largest campaign contributor. During that time, he has received $57,000 from the Apollo Education Group, more than any other member of Congress.
The Department of Education audit also found 292 proprietary schools were getting 85 to 90 percent of their revenue from taxpayers in fiscal 2012. Collectively those schools took in $6 billion from the Department of Education, the military, and the VA.
Ed. Notes: There is a big disconnect between getting a so-called education and later making a lot of money, and the gap is getting wider each year. The government subsidies only worsen the situation, by keeping alive both (a) courses that do not lead to the salaries graduates want and (b) methods of instruction that merely bore students to tears. Money is very powerful wherever it gets spent.
What if we end the statist distortion of passing on knowledge? I bet that students and teachers could find the most effective and individually tailored ways to figure out what one wants to know. The savings would come from eliminating the overhead of administration and the expense of constructing buildings that are half empty most of the time.
And of course, ending the tax exemption for campuses would help, too, forcing schools to live in the real economy, too, just like everyone else.
This 2014 excerpt of the Weekly Wastebasket, Oct 3, is by Taxpayers for Common Sense.
The U.S. Department of Agriculture (USDA) “resolved” a trade dispute with Brazil. The resolution? U.S. taxpayers will pay Brazilian cotton growers $300 million.
Because the US subsidizes cotton growers — even those that simply owned land that once grew cotton — the World Trade Organization (WTO) granted Brazil the right to levy restrictions and tariffs on U.S. products, including on intellectual property and other high value goods – not agriculture products. To avoid such retaliation, and to continue subsidizing U.S. cotton farmers, the US made its deal with Brazil.
The USDA is requiring taxpayers to fork over $300 million to Brazilian cotton growers in order to squander nearly $4 billion on US cotton farmers.
The nearly trillion dollar farm bill passed into law this spring creates new subsidy programs for dozens of crops from corn and soybeans to chickpeas and mustard seeds. This is on top of the billions we spend each year subsidizing crop insurance policies for 130 different crops, still more shallow loss programs, government-set price supports, marketing loans, quotas, import restrictions, and sweetheart deals for sugar.
Any other country with a significant cotton industry, say India, or other crop that the US subsidizes, could be next in line for a handout.
Ed. Notes: Landowners have such an easy time wringing subsidies from politicians! Ironically, that’s exactly the opposite of what government should be doing: which is recover the socially-generated land values from land owners. And then share them out among citizens while not taxing the earnings, purchases, and buildings of citizens.
This 2014 excerpt of Common Dreams, Oct 2, is by Deirdre Fulton.
Global income inequality has returned to levels recorded in the 1820s —- when the Industrial Revolution produced sizable wealth gaps between the rich and poor —- according to a new report released by the Organization for Economic Cooperation and Development (OECD).
“How Was Life? Global Well-Being Since 1820″ affirms great strides have been made in some areas such as literacy, life expectancy, and gender inequality. Income inequality began falling at the end of the 19th century.
Around 1970, it began to rise markedly. The number of those living in households without any income from work has doubled in Greece, Ireland, and Spain.
Ed. Notes: Obviously, machines and factories produced more wealth and more income for more people. But that extra money in the pocket let people bid up the price of land. That’s how success sows the seeds of its own failure; as spending for land goes up, spending for goods and services must go down.
It might take a while for the improvement in distribution to peter out — almost 200 years — but from here on out it will only get worse.
That is, until people wise up and share the value of land, sort of like what Alaskans do with oil revenue and what Singapore does with the surplus revenue generated by keeping taxes on people’s efforts low and taxes that recover rents high. Nobody has to wait for a national government to recover location value; geonomics is something reformers can do with their local government’s cooperation.
This 2014 of Guardian Liberty Voice, Spt 26, is by Carolette Wright.
Rate tables released by the Organization for Economic Corporation & Development (OECD) shows the US has the “highest burden” of corporate taxes than any other leading country. The top corporate rate is 39.1 percent. “High” is relative; many countries are contenders.
The OECD, founded in 1961, is the organization for industrialized governments whose mission is to advise on foreign taxation policies. The OECD also brings a resolution for issues such as tax competition with economies not affiliated with OECD, as well as cases of tax evasion tax proceedings on environmental issues.
Worldwide Tax Summaries published by the PwC, a tax consultancy, lists the 34 countries in the organization that make up the industrialized world; four countries were recently added in 2010, among them were Israel, Chile, Estonia, and Slovenia.
Ed. Notes: To avoid this rate, big rich US corporations re-incorporate in the Cayman Islands and other tax havens where the rate is lower. Plus, there are other ways US corporations avoid this rate so that few if any actually pay such a high rate. Indeed, each year the magazine Business Week lists all the businesses that not only totally dodged taxes but actually got multi-million dollar checks back from the US Treasury.
Better than trying to take profit from successful companies would be to not give them so much money in the first place. That means an end to corporate welfare. That also means an end to most taxes as we know them, since they tilt the playing field in ways that favor Big Business. For example, the tax on wages helps make hiring employees less affordable. So jobs are fewer and workers more desperate, too desperate to negotiate higher wages.
Conversely, the absence of a tax on land, or of land dues, lets owners and speculators and lenders do things like withhold prime sites from use and flip buildings and collusively bid up their prices. A tax on land, or land dues, would wipe out these practices and spur owners to put and keep prime locations at best use, which would also require work, generate jobs, and raise wages. Thus as labor got a bigger share of the pie, capital would get a smaller share and would not be such big targets of envious taxists.
Further, much profit is not exactly a return to capital but a return to land or to privilege. McDonald’s, for example, does not make its fortune from selling hamburgers but by leasing franchises to fast-food restauranteurs at busy locations. Thus most of McDonald’s income is actually land rent. Other companies gain not by beating their competition with a better mousetrap but by using patents and regulations to prevent other companies from competing with them at all. Governments need to get out of the business of granting such favors to so-called rent-seekers.
One more factor: Presently, since land is not taxed much nor are there land dues, individual and corporate owners can use land as collateral and qualify for fat loans. Not only does their borrowing awash the economy in debt and de-stabilize the economy with the boom/bust cycle, it also creates this “heads I win, tails you lose” phenomenon whereby they rake in inflated profits during booms and rake in massive bailouts during busts. It’s these unearned gains that corporations shelter and taxists target.
All these problems become non-issues in a just economy. Simply repeal counterproductive and taxes and replace them with land dues and other user fees. Abolish biased subsidies and replace them with dividends to citizens.
Putting geonomics into practice means government, business, workers, and even those beyond the economy would be pulling on the same end of the rope.
This 2014 excerpt of Open Secrets, Spt 25, is by Lalita Clozel.
As of mid-2014, the wealthiest American towns had spent about $14 million on the midterms, while benefiting Democrats and Republicans almost equally.
They were more willing to open their checkbooks during the presidential election, spending $36 million in 2012 compared to $19 million in the 2010 cycle.
Unlike the midterms, they veered conservative during the 2012 presidential election cycle; they spent $14 million on Democrats and close to $20 million on Republicans, or about 43 percent more.
It’s important to note, though, that these statistics are not necessarily representative of the states’ political climates. Many of these towns are very small.
Arizona’s most affluent town by these metrics is Paradise Valley, with a median income of almost $140,000. It counts among its residents Barbara Barrett, a former U.S. ambassador to Finland under President George W. Bush; her husband Craig, a former CEO of Intel Corporation; and former Republican Vice President Dan Quayle.
Ed. Notes: Why do the rich give lots to presidential races and little to midterm Congressional races? Probably because twice as many people vote for a president, even more, than during midterms, so there are more people to influence. It’s probably not that the president has more power than Congress; both are subservient to the prevailing plutocracy. It’s more likely that the presidential election sets the tone, attitude, and worldview of the American sheeple.
The solution is to not try to legislate money out of politics so much as it is to learn how to sway people in the face of so much spending. Another part is to quit giving so much money to one’s opponents. That involves not just boycotts but much more so local tax reform, especially shifting the property tax.
By shifting the property tax off buildings, onto land — something Pittsburgh did from 1980 to 2000 and enjoyed affordable housing — localities can shrink mortgages. Smaller mortgages will shrink the life-support system engorging Wall Street. And local races are much easier to win than federal ones.
This 2014 excerpt of the UK’s Telegraph, Oct 9, is by Nick Allen.
Drones deployed by tax inspectors over an upper class area of Buenos Aires found 200 mansions and 100 swimming pools that hadn’t been declared.
The evasions found by the drones amounted to missing tax payments of more than $2 million and owners of the properties have been warned they now face large fines.
Use of drones has been expanding in Argentina and the rest of South America with the unmanned vehicles being deployed for purposes as diverse as locating drug smuggling routes, monitoring farm crops, and looking for archaeological sites.
Most of the drone technology being sold to South American governments and companies – $500 million worth between 2005 and 2012 – comes from Israel, but drones are also being produced cheaply in Mexico.
Ed. Notes: Usually the rich in corrupt countries do not have to worry about tax collectors. Perhaps these are the nouveau riche who have not yet formed close ties with government officials. Governments really do not have the right to punish people for having mansions and pools anyway.
Maybe this invasion of the privacy of tax evaders will push them to support replacing taxes on property with a tax or fee or dues on the value of locations. Then landowners can build all the mansions and pools they want and still not pay any greater amount to government. And drones are not needed to assess or appraise the annual rental value of locations — that can be done from the street and government can save its millions for something else.
In a corrupt country, it is likely the rich acquired their wealth by corrupt means. However, rather than demand a cut later, government should quit being corrupt, keep its hands of private property, and instead recover the socially-generated value of land and resources. All parties need to get clear on what’s mine, what’s yours, and what’s ours.
This 2014 excerpt of Reuters, Spt 24, is by Steve Gorman.
The Obama administration has agreed to pay the Navajo Nation a record $554 million to settle longstanding claims by America’s largest Indian tribe that its funds and natural resources were mishandled for decades by the U.S. government.
The accord, resolving claims that date back as far as 50 years and marking the biggest U.S. legal settlement with a single tribe, will be formally signed at a ceremony in Window Rock, Arizona, the capital of the sprawling Navajo reservation.
The deal stems from litigation accusing the government of mismanaging Navajo trust accounts and resources on more than 14 million acres (5.7 million hectares) of land held in trust for the tribe and leased for such purposes as farming, energy development, logging and mining.
The deal does not preclude the tribe from pursuing future trust claims, or any separate claims over water and uranium pollution on its reservation.
The Navajo Nation is the most populous American Indian tribe, with more than 300,000 members, and the largest by land mass, occupying 27,000 square miles (70,000 sq km) across Arizona, New Mexico, and Utah.
Ed. Notes: Tho’ this settlement can not make up for centuries of cheating, it is good to see the worth of Earth going to more people instead of fewer — indirectly. The US probably won’t pay the Indians actual resource rent but instead merely pay out newly minted money and add to the US debt. That aside, who should receive society’s stream of spending for natural resources? Owners? Residents? Within what borders? Theoretically, Earth’s worth belongs to all Earthlings, but practically, some boundaries must be drawn.
This 2014 excerpt of the UK’s Financial Times, Spt 24, is by Robin Harding.
For almost two centuries, economists on the left and right have regarded the levy on land value as the best of all possible taxes, with almost magical powers of equity and efficiency. It was conservative hero Milton Friedman’s favorite tax, yet promoted just as often by socialists, with the latest echo in this week’s Labour party proposals for a “mansion tax” in the UK.
During the past decade, Altoona Pennsylvania has become the only city in the US to fully adopt LVT. In Altoona, only land – not the buildings standing on it or the people inside them – attracts a tax bill. You can put $175k into making an apartment building nice and you’re not going to see a rise in tax.
As site prices soar in big cities, they create much of the wealth documented by French economist Thomas Piketty. The tax on land creates a powerful incentive to use land to the full. That boosts the supply of houses.
Efficiency is not the only argument for LVT. In 1879, the American journalist and campaigner Henry George wrote Poverty and Progress, . George explained that nobody made the land; land becomes valuable only when a community turns it to productive use, so its earnings should go to society in place of all other taxes.
The great classical economists Adam Smith and David Ricardo also focused on land. Ricardo not only made a fortune by holding British government bonds when Napoleon lost at Waterloo but also invented chunks of economic theory.
Yet LVT is still little used after 200 years. And land taxes rarely last. Altoona began phasing in its tax in 2002, but is already debating whether to repeal or roll it back, like other jurisdictions – from New Zealand to Pittsburgh – where the idea has been tried.
The big political problem is that households do not notice they pay less under the LVT than they otherwise would, but commercial landowners, such as car dealers, feel the tax acutely.
Ed. Notes: Because a tax on your land can make you landless and thus houseless, it is rational for people to not exactly warm up to it. So how to make land taxes or land dues more palatable to land owners? A couple of things.
One, repeal stupid taxes on our efforts so owners have more wherewithal to pay the tax or dues.
And two, disburse the raised revenue back to citizens as a dividend.
Most people — not owning any downtown blocks or oil fields — will come out way ahead.
Not only that, but any good that making people pay rent to their community can do, sharing those recovered rents with everyone can do better. It’s fairer; government does not create land value, community does. And it’s more efficient, enabling people to leave pristine sites alone and to live in small towns if so inclined.
So put the horse before the cart and promote land dividends; land dues will come along automatically.
suitable for framing by Green Parties. When Greens began in Germany two decades ago, they defined themselves as neither left nor right but in front. Geonomics fits that description. The Green Parties have their Four Pillars; geonomists have four ways to apply them:
Ecological Wisdom. Want people to use the eco-system wisely? Charge them Rent and, to end corporate license, add surcharges. To minimize these costs, people will use less Earth.
Nonviolence. Want people to settle disputes nonviolently? Set a good example; don’t levy taxes, which rely on the threat of incarceration, to take people’s money. Try quid pro quo fees and dues.
Social Responsibility. Want people to be responsible for their actions? Don’t make basic choices for them by subsidizing services, addicting them to a caretaker state. Let people spend shares of social surplus.
Grassroots Democracy. Better have grassroots prosperity. Remember, political power follows economic. Pay people a Citizens Dividend; to keep it, they’ll show up at the polls, public hearings, and conventions.
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.
not exactly Georgism, the Single Tax on land value proposed by Henry George. He did, tho’, inspire most of the real-world implementations of the land tax that some jurisdictions enjoy today, and modern thinkers to craft geonomics. While his name and our remedy both begin with “geo” since both words refer to “Earth”, the two have their differences. (a) George pegs land monopoly as the fundamental flaw while geonomics faults Rent retention. (b) To fix the flaw, George was content to use a tax, while geonomics jettisons them in favor of price-like fees. (c) George focused on the taking while geonomics headlines the sharing. George envisioned an enlightened state judiciously spending the collected Rent while geonomics would turn the lion’s share over to the citizens via a dividend. (d) And George, as was everyone in his era, was pro-growth while geonomics sees economies as alive, growing, maturing, and stabilizing. Despite these differences, George should be recognized as great an economist as Euclid was a geometrician.
a study of a phenomenon David Ricardo noted going on two centuries ago. When wine grapes rise to $10,000 a ton from the very best land (last year, cabernet sauvignon commanded an average of $4,021 a ton in the Napa Valley), then vineyard prices soar from $18,000 an acre in the 1980′s to $100,000 an acre five years ago and now for a top pedigree up to $300,000 an acre (The New York Times, April 9, via Wyn Achenbaum). Pricey land does not make wine pricey; spendy wine makes land spendy. While vintners make their wine tasty, nature and society in general – not any lone owner – make land desireable. Steve Kerch of CBS’s MarketWatch (April 5) notes that much of what a home sells for on the open market is a reflection of intangible factors such as what school district the house sits in. The price the builder has to pay for the land also tends to be driven by the same intangibles. Because the value of land comes from society, and because one’s use excludes the rest of society, each user owes all others compensation, and is owed compensation by everyone else. Sharing land’s value, instead of taxing one’s efforts, is the policy of geonomics.
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 way to have everybody pulling on the same end of the rope. Last summer’s expansive forest fires shed light on growing class resentment in the West. Old log-gers and ranchers rankled at the new urgency to stamp out the blazes that threatened the recent Aspenesque settlers. The newcomers expected working class firemen to make protecting their expensive homes top priority. (Chr Sci Mntr, Spt 7) The tinder for this envy? Rich people moving in bid up the price of land, making it hard to afford by people on the margin. The fault really lies with our system of privatizing land value. If this rising value were collected by land dues and shared by rent dividends – the essence of geonomic policy – who’d complain? The more people move in, the higher the land value, and the fatter the dividend paid to residents. Then people on the margin might go out of their way to invite rich outsiders in.
an economic policy based on the earth’s natural patterns. Eco-systems self-regulate by using feedback loops to keep balance. Can economies do likewise? Why don’t they now produce efficiently and distribute fairly? The answers lie in the money we spend on the earth we use. To attain people/planet harmony, that financial flow from sites and resources must visit each of us. Our agent, government, must collect this natural rent via fees and disburse the collected revenue via dividends. And, it must forgo taxes on homes and earnings, and quit subsidies of either the needy or the greedy. As our steward, government must also collect Ecology Security Deposits, require Restoration Insurance, and auction off the occasional Emissions Permit. And that’s about it – were nature our model.
a new field of study offered in place of economics, as astronomy replaced astrology and chemistry replaced alchemy. Conventional economics, in which GNP can do well while people suffer, is a bit too superstitious for my renaissance upbringing. If I’m to propitiate unseen forces, it won’t be inflation or “the market”; let it be theEgyptian cat goddess. At least then we’d have fewer rats. Meanwhile, believing in reason leads to a new policy, also christened geonomics. That’s the proposal to share (a kind of management, the “nomics” part) the worth of Mother Earth (the “geo” part). If our economies are to work right, people need to see prices that tell the truth. Now taxes and subsidies distort prices, tricking people into squandering the planet. Using land dues and rent dividends instead lets prices be precise, guiding people to get more from less and thereby shrink their workweek. More free time ought to make us happy enough to evolve beyond economics, except when nostalgic for superstition.
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.
Think of all the beauty still left around you and be happy.
To err is human; to forgive, divine.
Why is the man who invests all your money called a broker?
When a man wants to murder a tiger he calls it sport; when a tiger wants to murder him he calls it ferocity.
George Bernard Shaw
What is faith worth if it is not translated into action?
Mohandas K. Gandhi
Half the lies they tell about me aren’t true.
When in doubt, tell the truth.
We hang the petty thieves and appoint the great ones to public office.
The equal right of all men and women to the use of land is as clear as their equal right to breathe the air. It is a right proclaimed by the fact of their existence. For we cannot suppose that some men and women have a right to be in this world and others do not.
A man must not deny his manifest abilities, for that is to evade his obligations.