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The Triple Dividend: Climate Change Mitigation, Justice, and Investing in Capabilities
This 2013 excerpt of a slide show was presented by Prof. Dr. Ottmar Edenhofer Jun 26 at Financing Global Public Goods, Workshop at MCC.
Rents can be used for distributive purposes like the reduction of poverty, or public investment!
• Conventional economic wisdom perceives rent taxation as neutral. Therefore, this „just“ tax has the largest potential to overcome the trade‐off between justice and efficiency. Additionally, only reproducible factors in production should earn income (labor and capital).
• The taxation of rents is perceived as a way to „socialise“ the commons even with private property rights.
• However, the potential of rent taxation is not neutral. Therefore, the potential for reaping a triple dividend is widely underestimated:
Rent taxation can be combined with intergenerational transfer schemes in which the newborn are endowed with assets financed by rents.
Additionally, rent taxation can be used to finance public infrastructure. Infrastructure can be seen as an investment in capabilities for the reduction of poverty.
Climate policy enhances the „Climate Rent“ which does not only mitigate climate change but also provides additional sources for infrastructure investments and intergenerational transfer schemes.
• The triple dividend might become the main motivation for climate policy.
This 2013 excerpt of USA Today, Nov 21, is by Oliver Stone.
Although polls from 1964 on clearly signal the public’s distrust of the official story, the mainstream media have never given up telling us how superstitious or illogical the common people are in this belief.
The single bullet theory allows for one bullet, fired from the sixth floor, on a downward trajectory, to enter Kennedy’s back and then move upward, out his throat and into Texas Gov. John Connally to his front, where it zigs and zags breaking two bones and creating seven wounds. Now, I’ve been in the infantry and I’ve seen enough combat to tell you that in all the craziness of war, this “Alice in Wonderland” scenario defies physics and common sense. JFK should be going forward when he receives that shot.
More than 50 witnesses testified at the time to the Warren Commission that they heard or saw a shot coming from that fence area to the front of the president.
The Assassination Records Review Board (1994-1998) found that over 40 witnesses in two locations saw a large avulsive (i.e. penetrating outward) wound in the rear of JFK’s skull. This wound again indicates an exit wound from a shot to the front. Conclusion: The president was shot from at least two sides, front and back — not one location.
An accidental film made that day, the Zapruder film, shows a sequence of motions that indicate five, probably six shots fired. It also shows that when the president is shot in the back by the “single bullet,” that he’s moving forward while Connally is still holding his Stetson hat, which is impossible if Connally was hit by the same bullet in his right wrist. The governor himself said he was not hit by the same bullet as Kennedy and added, “I do not for one second believe the conclusions of the Warren Commission.”
Is denial some form of American exceptionalism, by which our politics are unflawed by such corruption? Is this why the media, with very few exceptions, have not allowed any serious presentation of the evidence against their official story from qualified pathologists, scientists, photographic and ballistics experts, and doctors who disagree?
As Friday approaches, please take a moment to remember that no professional marksman has replicated the Warren Commission scenario with Oswald’s flawed rifle. To my knowledge, there have been at least four attempts with professionals to simulate the shooting without that rifle. No person ever achieved what the commission said Oswald did on the first try, i.e., attain two of three direct hits in the head and shoulder area to Kennedy in six seconds. This alleged shooting has been achieved only with computer simulations.
Ed. Notes: If the government were not afraid of the truth, why weren’t neutral investigators put in charge of the investigation? Why did their Navy doctor destroy evidence? And why did private investigators have to be the ones to release the Zapruder film?
This 2013 excerpt of CNBC, Aug 19, is by Matt Clinch.
Virtual currency bitcoin has been recognized by the German Finance Ministry as a “unit of account”. Does that mean it can be used for tax and trading purposes in the country?
Bitcoin is not classified as e-money or a foreign currency, the Finance Ministry said in a statement, but is rather a financial instrument under German banking rules. It is more akin to “private money” that can be used in “multilateral clearing circles”, the Ministry said.
“We should have competition in the production of money. I have long been a proponent of Friedrich August von Hayek scheme to denationalize money. Bitcoins are a first step in this direction,”said Frank Schaeffler, a member of the German parliament’s Finance Committee, who has pushed for legal classification of bitcoins.
Bitcoin is a virtual currency that allows users to exchange online credits for goods and services. While there is no central bank that issues them, bitcoins can be created online by using a computer to complete difficult tasks, a process known as mining. Currently one bitcoin is worth just over $119.
Legal classification of bitcoin means that commercial profits that stem from using the currency may be taxable. Classification by the German government gave bitcoin legitimacy to be used as a settlement currency in one of the world’s largest economies. This was a big step forward for the bitcoin movement.
Bitcoin could become an alternative to the euro if the single currency ever ceased to exist. Success for bitcoin rests on regulatory fair-treatment and the existence of a level playing field with other currencies.
“A free country should resist and not intervene in citizen’s private choice of money. In my opinion the production of money is none of the government’s business,” Schaeffler said.
Update 1 (Nov 21): The University of Nicosia has begun accepting bitcoins as payment for its courses, as well as launching a Master of Science degree focusing on digital currencies. The suggestion that we here at the Progress Report accept them, too, sounds good.
Update 2 (Nov 5): Reader Simon Lelieveldt says: “The legal tender qualification of the CNBC article was incorrect and has been taken off-line. See also my blog, further presenting the analysis and source documents: http://moneyandpayments.simonl.org/2013/08/bitcoin-legal-classification-in-germany.html”
Ed. Notes: What government should do is not monopolize legal tender but merely set the standards that any currency must reach — number of users, retaining its value — in order to be accepted as legal tender. Ironically, the currency of the Federal Reserve (which Congress allowed to replace US Notes) could not meet the second criterion for sound money. Could that be why the state and elite in America resist competition?
This 2013 excerpt of CNN, Nov 6, is by Karla Cripps.
Large schools of giant Nomura’s jellyfish, which have bodies ranging one to 1.5 meters in diameter, drift into Japanese waters in autumn and damage coastal fisheries. At the beginning of October, a large amount of jellyfish inhabiting a cooling-water intake at a Swedish nuclear plant caused operators to manually shut down production at its largest reactor. In Ireland, a jellyfish bloom reportedly killed thousands of farmed salmon.
This past summer, southern Europe experienced one of its worst jellyfish infestations ever. Experts there have been reporting a steady increase in the number of jellyfish in the Mediterranean Sea for years. The situation in the Mediterranean was dire enough to prompt Britain’s foreign office to issue a warning to its citizens vacationing along Europe’s southern coast to watch out for jellyfish.
Many of the world’s deadliest jellyfish are box jellyfish, which refers to the species’ cube-shaped meduae. There are several species of big box jellyfish that have caused many deaths — these include chironex fleckeri in Australia, chironex quadrigatus in Japan and related species in Thailand, Papua New Guinea and Indonesia.
Also known as the sea wasp and the northern Australian box jellyfish, the chironex fleckeri is possibly the worlds most venomous animal. Its tentacles can reach lengths of up to three meters long, while its bell is about the size of a human head. It can be found throughout the tropical waters of the Indo-Pacific. A close cousin and fellow contender for the “world’s most venomous” cup is the Irukandji, which is the size of a thimble. Good luck scanning the waters for that one before you leap in.
Just the lightest brush — you don’t even feel it — and then, whammo, you’re in more pain than you ever could have imagined, and you are struggling to breathe and you can’t move your limbs and you can’t stop vomiting and your blood pressure just keeps going up and up.
Tourists who avoid an area because of the known risk may alter their plans to hit a “safe” beach whose officials are merely less up front about the jellyfish situation, putting themselves more at risk. A common misconception is that places such as Indonesia, Thailand, Malaysia, and the Philippines are free of dangerous jellyfish.
The explosion in jellyfish populations is a visible indicator that life in the oceans is out of balance. So many species are in such low numbers, and habitats are so badly damaged, that restoring them to their original splendor is difficult.
Ed. Notes: Do you care? If so, use every tool in our arsenal. Not just better technologies. Not just better lifestyles. Not just better laws. But also, most importantly, use economic justice. Why? Because people ruin the planet not intentionally but as an untended consequence of making a living. So make making a living easier, less wasteful, and more just. Use geonomics.
This 2013 excerpt of Other Worlds, Aug 18, is by Tory Field and Beverly Bell.
Miriam Miranda is a leader of the Honduran Black Fraternal Organization (OFRANEH), which works with the 46 communities of the Afro-indigenous Garífuna of Honduras, to defend their territories, natural resources, identity, and rights. Miriam’s narrative below is from an interview with Beverly Bell.
We live on the Atlantic coast of Honduras. We are a mix of African descendants and indigenous peoples who came about more than 200 years ago in the island of San Vicente. Without our land, we cease to be a people. Our lands and identities are critical to our lives, our waters, our forests, our culture, our global commons, our territories.
If you map out the conflicts that are threatening our country, you’ll see they reflect exactly where transnational capital is trying to take more resources from indigenous peoples. Maybe you believe that president Mel Zelaya was ousted in a coup d’état [in 2009] because he was a leftist. No. It was because [those with wealth] wanted to take land and resources, which they are now doing.
In Honduras, they’re taking land that we were using to grow beans and rice so they can grow African palm for bio-fuel. The intention is to stop the production of food that humans need so they can produce fuel that cars need. The more food scarcity that exists, the more expensive food will become. The mono-cultivation of some of these crops [for bio-fuel] requires thousands of millions of acres of land. Food sovereignty is being threatened everywhere.
The Atlantic Coast of Honduras is the main narco-trafficking route. Almost 90% of the drugs that are going to the North pass through Honduras. We’re exactly in the way of the trafficking and we’re so vulnerable. Honduras has one of the highest levels of crime and violence [per capita] of any country that is not actually at war.
We live almost on the sea, right on the beach. It’s a blessing but recently it’s also become a curse, because of course all those with power want to have a place on the beach. The Honduran government has started on some tourism mega-projects. The displacement of communities and the loss of cultures that come with the development of tourism [is increasing].
We have created our own media, a community radio station for the Garífuna. In response to mass media trying to block the protection of our indigenous territories, we have created alliances with the four other community radios, and have started – together with COPINH [Civic Council of Popular and Indigenous Organizations of Honduras] a Mesoamerica Network of Community Radio.
Everywhere throughout Honduras, like in all of Latin America, Africa, Asia, women, many of them elders, are at the forefront of the struggles for our rights, against racial discrimination, for the defense of our commons and our survival. We’re at the front not only with our bodies but also with our force, our ideas, our proposals. We don’t only birth children, but ideas and actions as well.
Ed. Notes: People disagreeing over who gets to use which land for which purpose is ongoing, as long as people move around, population grows, and technology advances. But is it fair for one side to always win such disputes? How could the competition be settled fairly and peacefully?
One key component is to make the two sides more equal. Right now, it’s like the New York Yankees vs. a Little League team — nothing fair about that at all. To make the debate fair, both sides need roughly equal power, and since political power comes from economic power, there can’t be such a huge gulf in the income and wealth of the two sides.
The way to close the gulf is not by redistribution from the haves to the have-nots but by predistribution, by distributing the worth of Earth before an elite or state can keep such natural value for themselves. That means residents would pay in to the public treasury land taxes or Land Dues equal to the annual rental value of their location — and sites vary widely in their value — and residents would get back shares of the recovered rents in equal amounts, no citizen getting any more than anyone else. It’s sort of like what Alaska does with oil revenue and Singapore with land revenue. Then, on such a level playing field, disputants could reach an agreement fair for both people and planet — besides raising the indigenous up out of poverty, into a more comfortable, equitable, and admirable life.
Food Stamps Are Affordable; Corporate Welfare Is Not
This 2013 excerpt of Truthout, Nov 5, is by Thom Hartmann’s Daily Take Program.
In 2012, the average American taxpayer making $50,000 per year paid just $36 towards the food stamps program. That’s just ten cents a day! That’s less than the cost of a gumball.
When it comes to funding the rest of America’s social safety net programs, the average American taxpayer making $50,000 a year pays just over six dollars a year.
But the American taxpayer is paying a lot for the billions of dollars the U.S. government gives to corporate America each year. The average American family pays a staggering $6,000 a year in subsidies to big business.
Where does some of that $6,000 every year actually go? For starters, $870 of it goes to direct subsidies and grants for corporations. This includes money for subsidies to Big Oil companies that are polluting our skies and fueling climate change.
An additional $870 goes to corporate tax [loopholes that other taxpayers end up paying for] — or twice as much; Citizens for Tax Justice found that the U.S. Treasury lost $181 billion in corporate tax subsidies, which means the average American family could be out as much as $1,600 per year.
Of that $6,000 for corporations each year, $1,231 of it goes to making up for revenue losses from corporate tax havens. This money goes to recouping losses from giant transnational corporations like Apple and GE that hide their money overseas to boost profits and avoid paying income taxes.
In the past decade alone, corporations have doubled their profits. What we really can’t afford is doling out $100 billion each year to corporations that don’t need it. We can afford to help the poor in this country.
Ed. Notes: Actually, the subsidy to corporations is not tax loopholes. Government should not be taxing anyone’s earnings. And critics should not confuse corporate income with true earnings. Logically, if you don’t want corporations to have so much money, don’t give it to them in the first place.
The actual subsidy to corporations occurs when government grants privileges to businesses at pennies on the dollar. Companies pay pennies for limits on their liability, so do banks for the power to create new money, so does hi-tech for patents and copyrights, so do utilities for franchises, on and on. Each one of those little pieces of paper from the state is worth billions to the lucky insiders who get them.
So if we’re to grant such privileges, let’s charge full-market value for them, just as a business charges whatever the market will bear for its products and services — like weapons and insurance.
Even better, let’s stop politicians from spending our money and let’s spend it ourselves. That means we’d recover all of society’s surplus — all our spending for nature and privilege — and make it our common wealth by using it to fund a dividend to citizens. Doing that let’s us get rid of both counterproductive taxes and wasteful, addictive subsidies. We’d earn what we get, keep what we earn, and get an equitable share of the worth of Earth.
It’s the geonomic recipe for fairness and efficiency, and it has worked wherever tried, to the degree tried.
This 2013 of Moyers & Company, Aug 18, is by Michael Winship.
One of the plushest places at the table in the capitol is a seat on the House Financial Services Committee, the one that allegedly regulates the banks and Wall Street. In the first half of this year, political action committees “set up by lobbying firms, unions, corporations, and other groups trying to push their agenda in Congress” have given more money to its members — nearly nine and a half million dollars — than any other committee.
So many members are clamoring for a seat at the trough that extra chairs had to be installed in the committee room.
In 1974, 3 percent of retiring Congressmen became lobbyists. Now it’s 50 percent of Senators, 42 percent of House members.
Ed. Notes: Of course it’d help to classify campaign contributions as advance bribes, make them illegal, and throw in jail both the bribers and the bribees. Of course, then tax dollars would have to fund the election campaigns of candidates, but that’d be much cheaper than the current corrupt system. Plus, the government could make some TV time free, since it owns the airwaves, and get a deal from the Post Office, since it subsidizes that business.
More fundamentally, we must take the power of discretionary spending and wayward taxing away from politicians, so lawmakers then have nothing to offer for sale to businesses. Instead of taxing anything that moves and granting loopholes, the government would be limited to recovering the socially-generated values that attach to locations in nature and to privileges granted to businesses, such as the banking charter. Instead of subsidizing favorite insiders, government would be limited to disbursing public revenue to the citizenry as a monthly dividend. With nothing for sale, there’d be nothing to sell out for.
Money is where the rubber meets the road so revenue reform is key to solving many other issues, too.
See which sector wrote the biggest checks to political campaigns in your state in 2012.
This 2013 excerpt of Mother Jones, Nov 5, is by Alex Park and Tasneem Raja.
Just like in federal elections, big business has been writing big checks to campaigns in state and local elections.
Using data from www.FollowTheMoney.org, we mapped which industries gave the most to state-level campaign donors for the 2012 election (ballot initiatives and party PACs excluded) and limited our search to the top business in each state.
To follow the money in your state, see which industry topped the list of campaign contributions in the last election cycle:
Ed. Notes: Guess where the contributors got their money from? About two thirds of them got it directly from society’s spending for land and natural resources, things that nobody made and everybody makes valuable, the other third got theirs from society spending to meet the prices set by oligopolies in tech and medical attention. Most critics can’t see the source and hence miss the solution. The solution is to redirect such spending into public treasuries then back out as dividends. Once government recovers the socially-generated values of nature and privilege, it could repeal counterproductive taxes. Once it disburses dividends to the citizenry it could abolish wasteful and addictive subsidies. It’s called geonomics and it has always worked.
A massive industry led by ex-government officials profits off the government-induced fear of terrorism.
This 2013 excerpt of AlterNet, Aug 16, by Alex Kane.
Post-9/11 America has witnessed a boom in private firms dedicated to the hyped-up threat of terrorism. The drive to privatize America’s national security apparatus accelerated in the aftermath of the terrorist attacks, and it’s gotten to the point where 70 percent of the national intelligence budget is now spent on private contractors. The private intelligence contractors have profited to the tune of at least $6 billion a year. There are 1,931 private firms across the country dedicated to fighting terrorism.
What it all adds up to is a massive industry profiting off government-induced fear of terrorism, even though Americans are more likely to be killed by a car crash or their own furniture than a terror attack.
Former NSA head Michael Hayden, the man at the center of the Bush administration’s 2005 surveillance scandal, was defending his former agency on CBS News in the wake of the latest NSA spying scandal. Former Homeland Security chief Michael Chertoff had a similar message when he appeared on ABC News. CBS and ABC did not see fit to inform viewers that both Hayden and Chertoff are employees of the Chertoff Group, a private firm created in 2009 that companies hire to consult on best practices for security and combatting terrorism. Some of the companies the firm advises go on to win government contracts. Chertoff is the founder and chairman of the group, while Hayden serves as a principal. So they profit off a war on terror they say is crucial to keeping Americans safe. The TSA ordered 300 body scanners by Rapiscan, one of the Chertoff Group’s clients. The Huffington Post reported that Rapiscan made $118 million from the government between 2009-2010.
Booz Allen Hamilton wins massive government contracts. Its vice president is the former director of national intelligence, while the current director of national intelligence is a former employee of Booz Allen. Booz Allen Hamiltion made over $5 billion last fiscal year. The company announced that it had won a contract with the Defense Department that’s worth up to $5.6 billion.
Formerly California-based Science Applications International Corporation (SAIC), sometimes referred to as “NSA West” because so many former NSA employees go on to work for them, this firm makes a ton of cash off government contracts. When John P. Jumper, the current CEO of SAIC, was an Air Force general, he said the threat of terrorism is “greater than Nazism, greater than communism.” SAIC boasts 42,000 employees —- 20,000 of whom hold U.S. government security clearances. It is the NSA’s largest contractor. Last year it reported a net income of $525 million.
Through Homeland Security grant programs, the federal government has doled out over billions of dollars to private companies to provide education and training to members of the U.S. national security community, including law enforcement agencies. One of these companies is called the Center for Counterintelligence and Security Studies. Staff members include former FBI, CIA and Defense Department personnel. A five-day course for government employees on the “Global Jihadist Threat Doctrine” costs $39,280.
Security Solutions International is another private firm hawking anti-Muslim training to law enforcement. This Miami-based company founded in 2004 uses its Israeli security connections to boost its standing in the market. They use Israeli security trainers in their courses and their president, Henry Morgenstern, is a dual Israeli-U.S. citizen who says he “developed excellent high level contacts with the Security Establishment [in Israel], making SSI the premiere training company for counter-terror related subjects.”
Ed. Notes: The runaway spending by politicians on insiders, such as these ex-government employees in the war machine, is contributing to the bankrupting of the US. Is the high cost worth it? One way to find out just how threatening the suicidal bombers really are is to make the state response to them totally non-profitable. Make our fighting totally “patriotic”. Pay these contractors no more than how much we pay low-ranking GIs. If those insiders could not rake in billions, I bet they’d have nothing to say about the threat.
So that citizens could feel exactly how expensive all its various wars are, make the income tax fund one thing and one thing only and that is the violent response to threats. All the rest of the Federal budget, either fund by charging user fees or eliminate the subsidized programs and replace with a Citizens Dividend funded by recovered rents, by all of society’s spending for land and resources.
A bonus! As this model spreads to other nations, they’d prosper and produce fewer disgruntled citizens, so the threat of attacks would drop to nearly nil. At much less cost, the world could enjoy security, prosperity, and freedom. Start geonomizing today!
Settlements in East Jerusalem are considered illegal under international law
A 2013 excerpt of the BBC, Oct 30.
Israel has announced plans to build new homes in a Jewish settlement in occupied East Jerusalem, hours after freeing 26 Palestinian prisoners.
Officials said the construction of 1,500 housing units at Ramat Shlomo was one of four projects given approval.
The Palestinian Authority said the move was “destructive to peace efforts” and might kill the two states vision which they see for the land.
It is believed to be an attempt by Prime Minister Benjamin Netanyahu to assuage anger in Israel at the release of the long-term prisoners overnight.
The convicted killers were freed as part of a US-brokered agreement to resume direct Israeli-Palestinian peace talks after a three-year hiatus.
The men – the second of four groups to be released over nine months – were welcomed by thousands of people in the Gaza Strip and West Bank, including Palestinian Authority President Mahmoud Abbas.
An estimated 200,000 settlers currently live in East Jerusalem, alongside 370,000 Palestinians.
Israel captured East Jerusalem from Jordan in the 1967 Middle East war and formally annexed the area in 1980. Settlements built there and elsewhere in the occupied West Bank are considered illegal under international law, though Israel disputes this.
Ed. Notes: The “salem” part of the name of the city means peace; why not aim for that? Peace can only follow tolerance and acceptance of others. Perhaps the city could belong to neither side but become an international city, governed by impartial outsiders who love the relevant part of history.
A peace plan for the whole region would depend on economic equality and opportunity, so anyone can bid for land and not be at a disadvantage to others more wealthy. For the Palestinians to catch up, they’d probably have to raise the status of women, not just so women could become better educated and join the workforce but also to reduce machismo and hierarchy in Arab society. Regarding unfounded stature so seriously creates a mindset diametrically opposed to the mindset needed to be an entrepreneur or inventor or investor in cutting-edge ideas.
Another plank for peace would be geonomics, in which people pay in Land Dues and get back Rent Dividends. Jews would pay in more than Moslems, since the Israelis are more prosperous and live and work on more valuable locations. But all residents would get back an equal share, so not only would Israelies and Palestinians be treated equally as co-inhabitants of the land but the Arabs would see a relative gain, since the money would more widely exceed their land dues and cover more of their cost of living.
Another key would be to de-tax labor and capital and abolishing wasteful and corrupt subsidies. These four geonomic steps — de-tax, de-subsidize, recover all “rents”, and pay dividends — would make the region into a fabulous enterprise zone that other strife-torn regions would try to copy.
Once people start prospering together, wouldn’t they be able to live together as do the Swiss, a nation of Germans, French, and Italians?
This 2013 excerpt of ProPublica, Aug 13, is by Abrahm Lustgarten.
In 1982, in a landmark effort to keep people from being fleeced by the oil industry, the federal government passed a law establishing that royalty payments to landowners would be no less than 12.5 percent of the oil and gas sales from their leases.
From Pennsylvania to North Dakota, a powerful argument for allowing extensive new drilling has been that royalty payments would enrich local landowners, lifting the economies of heartland and rural America. The boom was also supposed to fill the government’s coffers, since roughly 30 percent of the nation’s drilling takes place on federal land.
Over the last decade, an untold number of leases were signed, and hundreds of thousands of wells have been sunk into new energy deposits across the country.
But manipulation of costs and other data by oil companies is keeping billions of dollars in royalties out of the hands of private and government landholders, an investigation by ProPublica has found. In some cases, they are being paid virtually nothing at all.
Some companies deduct expenses for transporting and processing natural gas, even when leases contain clauses explicitly prohibiting such deductions.
Significant amounts of fuel are never sold at all – companies use it themselves. Chesapeake Energy deducted marketing fees from payments to a landowner even though the fees went to its own subsidiary. A court ruled that the company was entitled to charge the fees.
Over the last three decades, the government has recouped more than $4 billion in unpaid fees from cheating extractors.
Ed. Notes: While the little guys getting a slice is better than the big guys hogging it all, who really deserves the surplus value of oil in the ground? Nobody put it there. And everybody makes it valuable (by buying so much gasoline, mainly, and some heating fuel, etc). At least Alaska pays residents an oil dividend. And Norway funds a generous government. To know how much of the profit represents the rental value of oil in the ground, perhaps governments should buy stock in oil companies, attend stockholder meetings, get on the boards of directors, and examine the books closely. That’s spell an end to our oiligarchy now ruling the world, and get us closer to a democracy, secure on economic justice.
Are private property rights under siege by a government program called Rails to Trails?
This 2013 excerpt of Reason, Oct 27, is by Kathryn Ciano.
Rails to Trails is a government program to convert abandoned railroad tracks to recreational trails. Sounds great, except that the tracks run over private property, and the private landowners haven’t been paid for this permanent land grab. A case before the Supreme Court this term, Brandt v. United States, demonstrates the program’s problems.
In 1988, a century after contracts were signed, the federal government passed a “Railbanking” law to preserve its possession and establish its right to turn abandoned railroad tracks into recreational parks. This was not what landowners had agreed to and was not within the terms of the government’s limited right to use others’ land.
Converting the tracks into a trail makes the government’s use of the land permanent rather than temporary and conditional on the railroad’s use. It also changes the nature of how the government plans to use the land. If the government wants to convert the expired railroad easement into a recreational trail, it should pay compensation for this new, permanent taking.
The Pacific Legal Foundation filed an amicus brief on landowners’ behalf.
In 1875 the government paid landowners minuscule sums of money for the right to run tracks on private property. The government never attempted to make a clean purchase or negotiate permanent takings under the doctrine of eminent domain.
Assistant Attorney General Thomas L. Sansonetti warned Congress that then-pending rails-to-trails cases across the country involved 4,550 private property owners and exposed the government to over $57 million in constitutionally-required compensation for these takings.
Property rights are one of the more fundamental principles of free society. The government cannot avoid the Constitution by avoiding the most basic principles of ownership. The Supreme Court should respect landowners’ common law rights and expectations and grant quiet title to the Brandts, or else require the government to pay just compensation for taking the Brandts’ land.
Ed. Note: Would owners be so eager to get back land they’re not using if they (and everyone) had to pay Land Dues or a land tax? Talk about compensation, shouldn’t owners compensate those whom they exclude from some Earth, the planet being our mutual heritage? And why call the property “private” since the privacy of the owners — far removed from remote trails — is not in question?
Owning land does convey benefits and rights but also duties. The rental value of land belongs not to the owner but is owed by the owner to their community. That’s because owners did not create the land nor buy it from any creator and the community as a whole generates the land’s rental value.
Yet owners can wear a happy face and need not worry. Since all owners would be paying in dues and all residents would be getting back dividends, an equal share of the recovered rents. While sharing makes materialists feel threatened and raises their hackles, the very same people cite Singapore as one of the freest places in the world. Ironically, that Asian city uses a system very much like this geonomic one herein described.
This 2013 excerpt of The Ecologist, Jly 24, is by Kevin Grandia.
Enforcement of environmental infractions by companies in the Alberta oil sands are 17 times lower than similar infractions reported to the United State’s Environmental Protection Agency (EPA).
Of the more than 4,000 infractions reported, less than 1 percent (.09 to be exact) received an enforcement action (that would be less than 40 of 4,000). Compare this the EPA, who has an enforcement rate of 16 percent for similar infractions by companies under the Clean Water Act.
The median fine for environmental infractions in the oil sands over the past 16 years was $4,500. If you were an oil-sands player like ExxonMobil, who reported a profit last year of $44.9 billion, would you change your ways over a $4,500 fine?
Royal Dutch Shell Oil’s CEO, another big player in the oil sands, probably spent $4,500 on golf and dinner yesterday.
TransCanada, the company trying to convince President Obama to approve the construction of the Keystone XL pipeline, asks whether the U.S. wants to source its heavy oil from Canada, a friendly and stable ally with strict environmental standards, or from other suppliers whose interests are not aligned with those of the United States and have limited or no environmental standards.
Ed. Notes: Exploit Earth, you’re in the suites. Love Earth, you’re in the streets. If only protestors could see what matters to oil executives the most, and that’s limited liability, which protects those in management making decisions to impose damage on others, instead of having fines for infractions coming out of their own pockets. Hit’em where it hurts; that’s the kind of reform that’ll make a difference.
This 2013 excerpt of Dissident Voice, Aug 12, is by Stuart Jeanne Bramhall.
Why do American children study Karl Marx, the villain we love to hate, in school? Yet Henry George, whose views on land and tax reform gave rise to the Progressive and Populist movements of the 1900s, is totally absent from US history books. During the 1890s George, author of the 1879 bestseller Progress and Poverty, was the third most famous American, after Mark Twain and Thomas Edison. In 1896 he outpolled Teddy Roosevelt and was nearly elected mayor of New York.
In Neo-classical Economics as a Stratagem Against Henry George (2007), University of California economist Mason Gaffney argues that George and his Land Value Tax pose a far greater threat than Marx to America’s corporate elite. America’s enormous concentration of wealth has always depended on the inherent right of the wealthy elite to seize and monopolize vast quantities of land and natural resources (oil, gas, forests, water, minerals, etc) for personal profit. Adopting a Land Value Tax (LVT), which is far easier than launching a violent revolution, would essentially negate that right. What’s more, every jurisdiction that has ever implemented an LVT finds it works exactly the way George predicted it would. Productivity, prosperity, and social wellbeing flourish, while inflation, wealth inequality, and boom and bust recessions and depressions virtually vanish.
Gaffney believes neoclassical economic theory undermines George’s arguments for a single Land Value Tax in two basic ways: 1) by claiming that land is no different from other capital (ironically Marx made the identical argument) and 2) by portraying the science of economics as a series of hard choices and sacrifices that low and middle income people must make.
Gaffney also identifies the robber barons whose fortunes financed the economics departments of the major universities who went on to substitute neooclassical economics for classical economic theory. At the top of this list were:
Ezra Cornell (owner of both Western Union and Associated Press) – founder of Cornell University
John D Rockefeller – helped fund the University of Chicago and installed his cronies in its economics department.
J. P Morgan – investment banker and early funder of Columbia University
B&O Railroad – John Hopkins University
Southern Pacific Railroad – Stanford University
The final section of Gaffney’s book lays out the tragic economic, political, and social consequences of allowing the Red Scare and neoclassical economics to stifle America’s movement for a single Land Value Tax.
Exhaustive Survey of Nearly 2,000 Markets and 52,000 Listings Shows More Than $2 Million Difference in Price Between Malibu and Cleveland.
This 2013 excerpt of Coldwell Banker, Nov 6, is by Heather Roberts and Katy Hendricks.
The glitz, glamour and white sandy beaches of Malibu, Calif., have attracted the rich and famous to this premier destination for years. Malibu is the most expensive place to live in the United States. An apples-to-apples comparison of four-bedroom, two-bathroom homes in more than 1,900 real estate markets across the United States, a sample-sized home in the affluent beach community of Malibu lists for $2.15 million, compared to $63,729 in Cleveland, Ohio.
What are the three most important things in real estate? Location, location, location. Part of Los Angeles, it is situated on the Southern California coast with beautiful homes and even more stunning views. Cleveland, Ohio, has mansions, too, but views only of Lake Erie and harsh weather.
This year’s report identified 20 markets where a four-bedroom, two-bathroom home costs more than $1 million, whereas in eight markets a similar home lists for less than $100,000.
The average listing price of a four-bedroom, two-bathroom home in the survey of more than 1,900 markets and 52,000 listings was $301,414.
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.
about the money we spend on the nature we use. It flows torrentially yet invisibly, often submerged in the price of housing, food, fuel, and everything else. Flowing from the many to the few, natural rent distorts prices and rewards unjust and unsustainable choices. Redirected via dues and dividends to flow from each to all, “rent” payments would level the playing field and empower neighbors to shrink their workweek and expand their horizons. Modeled on nature’s feedback loops, earlier proposals to redirect rent found favor with Paine, Tolstoy, and Einstein. Wherever tried, to the degree tried, redirecting rent worked. One of today’s versions, the green tax shift, spreads out of Europe. Another, the Property Tax Shift, activists can win at the local level, building a world that works right for everyone.
close to the policy of the Garden Cities in England. Founded by Ebenezer Howard over a century ago, residents own the land in common and run the town as a business. Letchworth, the oldest of the model towns, serves residents grandly from bucketfuls of collected land rent (as does the Canadian Province of Alberta from oil royalty). A geonomic town would pay the rent to residents, letting them freely choose personalized services, and also ax taxes. Both geonomics and Howard were inspired by American proto-geonomist Henry George. The movement launched by Howard today in the UK advances the shift of taxes from buildings to locations. A recent report from the Town and Country Planning Association proposes this Property Tax Shift and their journal published research in the potential of land value taxation by Tony Vickers (Vol. 69, Part 5, 2000). (Thanks to James Robertson)
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 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 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.
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 neologism for sharing “rent” or “social surplus” – the money we spend on the nature we use. When we buy land, such as the land beneath a home, we typically pay the wrong person – the homeowner. Instead, since land cost us nothing to make and is the common heri-tage of us all, rather than pay the owner, we should pay ourselves, our neighbors, our community. That is, we should all pay land dues to the public treasury, then our government would pay us land dividends from this collected revenue. It’s similar to the Alaska oil dividend, almost $2,000 last year. Indeed, the annual rental value of land, oil, all other natural resources, including the broadcast spectrum and other government-granted permits such as corporate charters, totals several trillion dollars each year. It’s so much that some could be spent on basic social services, the rest parceled out as a divi-dend, as Tom Paine suggested, and taxes (except any on natural rents) could be abolished, as Thomas Jeffer-son suggested. Were we sharing Earth by sharing her worth, territorial disputes would be fewer, less intense, and more resolvable.
of interest to Dave Lakhani, President Bold Approach (Mar 8) and Matt Ozga (Jan 29): “I write for the Washington Square News, the student run newspaper out of New York University. Geonomics seems like it has great significance, especially in this area. When was geonomics developed, and by whom?”
About 1982 I began. Two years later, Chilean Dr Manfred Max-Neef offered the term geonomics for Earth-friendly economics. In the mid-80s, a millionaire founded a Geonomics Institute on Middlebury College campus in Vermont re global trade. In the 1990s, CNBC cablecast a show, Geonomics, on world trade as it benefits world traders. My version of geonomics draws heavily from the American Henry George who wrote Progress & Poverty (1879) and won the mayoralty of New York but was denied his victory by Tammany Hall (1886). He in turn got lots from Brits David Ricardo, Adam Smith, and the French physiocrats of the 1700s. My version differs by focusing not on taxation but on the flow of rents for sites, resources, sinks, and government-granted privileges. Forgoing these trillions, we instead tax and subsidize, making waste cheap and sustainability expensive. To quit distorting price, replace taxes with “land dues” and replace subsidies with a Citizens Dividend.
Matt: “This idea of sharing rents sounds, if not explicitly socialist, at least at odds with some capitalist values (only the strong survive & prosper, etc). Is it fair to say that geonomics has some basis in socialist theory?”
A closer descriptor would be Christian. Beyond ethics into praxis, Alaska shares oil rent with residents, and they’re more libertarian than socialist. While individuals provide labor and capital, no one provides land while society generates its value. Rent is not private property but public property. Sharing Rent is predistribution, sharing it before an elite or state has a chance to get and misspend it, like a public REIT (Real Estate Investment Trust) paying dividends to its stakeholders – a perfectly capitalist model. What we should leave untaxed are our sales, salaries, and structures, things we do produce.
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 we have to do is to be forever curiously testing new opinions and courting new impressions.
You’ll never have a quiet world till you knock the patriotism out of the human race.
George Bernard Shaw
The important thing is not to stop questioning.
High achievement always takes place in the framework of high expectation.
You may be disappointed if you fail, but you are doomed if you don’t try.
I would no more teach children military training than teach them arson, robbery, or assassination.
Eugene V. Debs
I want to be thoroughly used up when I die, for the harder I work the more I live. I rejoice in life for its own sake. Life is no brief candle to me. It is a sort of splendid torch which I have gotten hold of for the moment and I want to make it burn as brightly as possible before passing it to future generations.
George Bernard Shaw
The coldest winter I ever spent was a summer in San Francisco.
If we did all the things we are capable of, we would literally astound ourselves.
Thomas A. Edison
Everything should be made as simple as possible, but not one bit simpler.