We are Hanno Beck, Lindy Davies, Fred Foldvary, Mike O'Mara, Jeff Smith, and assorted volunteers, all dedicated to bringing you the news and views that make a difference in our species struggle to win justice, prosperity, and eco-librium.
Ed. Notes: Why should anyone fund Ukraine? Its government is deep in debt because it’s corrupt. Why does the US always choose corrupt rulers to give Americans’ money to? Better than all this macho posturing would be to shut down US bases in Europe and admit Russia into NATO — then shut down NATO, too.
The main reason that power-grabbing individuals want their own country is so that they can rip off their own people. The reason that vast numbers want their own country is so they can be ruled by individuals who belong to the same ethnic group that the people identify with. Both are shallow reasons and make the notion of country appear shallow, too.
If the world went geonomic, these disagreements would become non issue. Who cares who’s in power if they have no power to tax your labor or capital or subsidize their cronies? Who cares where the border is drawn if there’s free trade, free travel, and global Earthling dividends? It’s hard for most people to see beyond the imposed framing on current conflicts but once you do, you see the solutions that work right for everybody.
These two 2014 excerpts are from (1) Future Cities, Mar 3, by Walter Fieuw, and (2) Policy Scotland, Mar 4, by Ken Gibb of University of Glasgow.
How to Fund City Growth? Value Capture
Land value tax dates back to the early roots of modern cities, and it could end up financing our future.
Land value tax is leveraged against unimproved land value. “Land” is the unimproved site, not counting infrastructure or buildings; “Value” refers to the increased market value after public investment; and “Tax” is the payment due for exclusive occupation of the site.
The idea to capture value was first popularized by economist and social reformer Henry George (1839–1897) who was convinced that revenue generated from nature and land belonged to society. In his seminal work, Progress and Poverty, George argued that taxing land value deters speculative land holding.
Paul Romer, director of NYU Stern Urbanization Project, shares the view that strong, principled city charters based on value capture will change power relations in cities:
Building great cities requires brave leadership. Value capture can be a cornerstone of a new system for land taxation and progressive development financing. For, as Henry George taught us, the economic return of land should be shared equally, and not held in the grips of private owners.
Going back to Tom Payne’s use of John Locke’s property rights arguments to justify taxing land, through Ricardo’s attack on unproductive economic rent from monopoly land owners and on to Henry George and the ‘crank’ idea to have a single tax through taxing land. Lloyd George, supported by Churchill, twice proposed an LVT for the UK prior to the First World War. After the Second World War, legislation was supposed to combine the granting of planning permission with some form of land development or betterment tax – four successive attempts subsequently to introduce and make work such taxation abjectly failed.
The core idea is taxing unproductive economic rent derived from land ownership. Taxing the economic rent in land values but leaving the structures untaxed should allow ‘society’ to capture a proportion of the gains landowners receive in uplift in values as a result of planning permission and the benefits of public infrastructure support. Thus, landowners with planning permission have an incentive to build and there is no tax disincentive to make the land productive.
It would be good to get a discussion going about how to make progress on rational tax reform.
Ed. Notes: If you’re going to tax people, it’s makes good sense to put location values into your tax base and boot other values out. Ethically, nobody made land and everybody (the presence of the populace) makes land valuable. Economically, the levy drives efficient land use and raises wages. What’s not to like? Plenty. People just are not interested. How to interest them? Probably downplay the tax. Instead, convert the recovered ground rent revenue into a resident’s dividend and up-play that — money in the pocket!
Ed. Notes: The author calls for the usual higher minimum wage, stronger unions, restricting international exchange, etc. Yet in the past when we had those policies and more, we still had widespread poverty. Shouldn’t we be trying something else?
How about if we try what works? Any place that has used any aspect of geonomimcs has benefitted: de-tax wages, de-fund corporate welfare, enforce environmental standards, recover the socially-generated value of sites and resources, and pay people a dividend from the resultant surplus public revenue, a la the dividend of Alaska or Singapore, for example.
Of those, the most potent and maybe the hardest to implement is the public recovery of publicly-generated land values. It works because it spurs owners to use prime locations most efficiently, which creates jobs and attracts investments. It’s fair because we didn’t create land, we all need land, and paying land dues is a way of compensating our neighbors, those whom we exclude (as long as the government pays a dividend or provides universally desired social services). Land dues run up against land speculation but they are what make geonomics tick.
This 2014 excerpt of The Guardian, Mar 3 is by George Monbiot.
The biggest 174 landowners in England take £120m between them. A €300,000 cap would have saved about £70m. If farmers were subject to the benefits cap that applies to everyone else (£26,000), the saving would amount to about £1bn.
First we give rich landowners our money – vast amounts of it, uncapped and almost unconditional. Then we pay for the costs they kindly dump on us: the floods, the extra water purification necessitated by the pollution they cause, the loss of so many precious and beautiful places, the decline of wildlife that enchants and enraptures. Expensive, irrational, destructive, counter-productive: this scarcely begins to describe our farming policies.
But it need not be this way. Change the rules, change the incentives, support impoverished farmers to do the right thing, stop support for the rich farmers altogether, and everything else can follow.
Turn the rivers flowing into the lowlands into “blue belts” or “wild ways”. For 50 metres on either side, the land would be left unfarmed, allowing trees and bogs to return and creating continuous wildlife corridors. Bogs and forests trap the floodwaters, helping to protect the towns downstream. They catch the soil washing off the fields and filter out some of the chemicals which would otherwise find their way into the rivers. A few of us are now in the process of setting up a rewilding group in Britain, which would seek to catalyse some of these changes.
We must insert a political crowbar to prise the government away from the industry it is supposed to regulate.
Ed. Notes: We humans could do a much better job of extracting our livelihood from the earth sustainably. We humans might feel a stronger motive to do a better job if we practiced geonomics. If we all paid land dues and got back rent dividends, we would be connected to Mother Earth financially. She’d become our commons. If she lost value, making our dividend shrink, we’d sit up and take notice and if for no other reason than the bottom line, we’d make the necessary corrections so that none of us could get away with doing environmental harm, since that also lowers land value. After doing the right thing for maybe not the right reason for a while, probably we’d internalize the values of stewardship and treat the natural world sustainably because we’d see ourselves as part of it.
NBC News, Feb. 17, 2014: ‘Bizarre’ Cluster of Severe Birth Defects Haunts Health Experts
A mysterious cluster of severe birth defects in rural Washington state [and] reports of new cases continue to climb. Federal and state officials won’t say how many women in a three-county area near Yakima, Wash., have had babies with anencephaly — born missing parts of the brain or skull. And they admit they haven’t interviewed any of the women in question, or told the mothers there’s a potentially widespread problem.
[...] nearly two dozen cases in three years, a rate four times the national average
[...] CDC and state officials refused to tell NBC News how many new cases they’d received in 2013
[...] Allison Ashley-Koch, professor at the Duke University Medical Center for Human Genetics: “Any time you see a geographic cluster of a pretty severe birth defect, it does make you wonder if there is a common exposure
[...] If you could find a way to stop this from happening, why wouldn’t you want to do that? Why would you not want to tell people?”
NBC’s report failed to mention the cluster’s proximity to Hanford, the most contaminated area in Western Hemisphere.
Ed. Notes: Polluters are both businesses and governments. Presently, we can hold business people accountable, especially if we quit letting them hide behind limited liability. But how can we hold elected officials and bureaucrats accountable?
Maybe we can’t and so we should not let government wield so much power in the first place. How? Rather than let politicians spend public money to fund their grandiose ideas such as dump sites, force them to raise the money by selling bonds. Bond buyers are more cautious, since they don’t want to lose their investment or become liable for hazardous projects. Governments would not be able to sell enough bonds to fund something as hazardous as a nuclear dump.
This is an economic solution, not a political solution such as trying to persuade government to clean up this one site while leaving the power of spending in the hands of government. Since money matters, this economic solution should work.
These three 2014 excerpts are of: (1) The View from Cullingworth, Mar 2, by Simon Cooke (the village’s Conservative Councillor); (2) The Age, Mar 3, by Ross Gittins (Sydney Morning Herald’s Economics Editor; and (3) Macrobusiness, Mar 3, by Houses and Holes in Australian Economy.
Rent-seeking at Work
New York held an auction for individual yellow-cab medallions that give drivers the right to operate a taxi and pick up street hails. Winning bidders paid as much as $965,000 for the latest batch of medallions. You pay nearly a million dollars for the right to drive a cab in New York. This suggests that not only are there not enough taxis but that, as a result, the price of a taxi fare is higher.
What gets me is how blatantly self-seeking our lobby groups have become.
These days far more people make their living lobbying for interest groups than did so in the 1980s.
Too many politicians, private office advisers and bureaucrats retire as gamekeepers to become poachers. The fact that ex-Coalition lobbyists do better under Coalition governments, while ex-Labor people do better under Labor governments is a sign that this is not an innocent, arms-length, information-gathering exercise.
The big miners, the financial services sector, the hotels and the registered clubs have the most money to invest (and I do mean invest) in rent-seeking.
Giving in to rent-seekers doesn’t make you any friends, it just makes things worse. Yielding to my pressure for a concession never satisfies me, it just shows me you’re an easy touch and prompts me to think of something else I want. Meanwhile, giving me a lolly just makes my rivals envious and prompts them to demand theirs. Bad inevitably leads to worse.
I very much agree with Mr Gittins about the problem he describes. Trouble is, I see him as one of the worst rent-seekers of all.
If rent-seeking prevents the most efficient flow of capital for productive purposes, and thus the rise of national wealth and with it the common good, then why does Mr Gittins spend so much of his time defending an economic model in which [financial] “services” and mining are seen as the natural evolution of the economy?
As more and more capital is sucked into the unproductive venture of mortgages, productivity starts to fall. That is where the Australian economy is today, with our banks pouring far larger proportions of the nation’s capital into mortgages than at time since records were kept. A considerable slice of Australia’s declining multi-factor productivity has resulted directly from escalating land prices.
“Holding gains and losses accrue to the owners of assets and liabilities purely as a result of holding the assets or liabilities over time, without transforming them in any way”. In economic terms, they are pure rents.
As Fairfax Media [Gittins employer] dies its slow death, it is being eaten by its own real estate businesses, which now constitute almost half the firm’s value.
Ed. Notes: The third critic makes a good point. Rent-seeking is not only the newer versions performed by taxicab owners and big businesses. Those extractions pale beside the classic seeking — and winning — of rents spent for land.
To halt the classic rent-winners, it’s not a matter of government quitting subsidizing insiders and leniently enforcing rights. It’s a matter of government being proactive and using its power of charging fees or levying taxes, or even of instituting dues, to redirect our spending for land from sellers and lenders into the public treasury then out again as dividends to everyone. That’d stymy the classic rent-seekers, whittle them down to size, making it much easier to halt the neo-rent-seekers and repeal corporate welfare and regulatory favoritism.
It’d also help greatly if people could see government as steward rather than as Santa Claus.
This 2014 excerpt of The Guardian, Mar 2 is by Dave Hill.
Some insist that the land banking problem is overstated but the GLA/Molior report argued that if work on every site for which planning permission had been obtained at that time began immediately “somewhere between 50,000 and 70,000″ homes would be completed for each of the ensuing three years.
If “use it or lose it” could help bring about even the lower of those two figures in London it would be a big boost.
Meanwhile calls from across the political spectrum and elsewhere continue for the introduction of another measure to lessen landbanking – a land value tax, something both Darren Johnson and Stephen Knight strongly endorse. Conservatives might reflect that Winston Churchill was pretty keen on the idea too.
Ed. Notes: Land banking is polite for land speculation. It results in wasteful use of metro land, making it a selfish, anti-social practice. The cure that’s always worked before is to charge owners a rent for their land, no matter how they’re using it. To pay the rent (or tax), they use their land well. To make the charge fair, it’d be good to at the same time lower or remove other taxes, especially on buildings. Going one step further, it’d be great to return the recovered rents as a dividend to residents, sort of like what Singapore does. You get better land use, you get more affordable housing, and you get economic justice, all in one (the one of geonomics).
This 2014 excerpt of Nature, Feb 24, is by Richard Van Noorden.
The publishers Springer and IEEE are removing more than 120 papers from their subscription services after a French researcher discovered that the works were computer-generated nonsense.
Labbé developed a way to automatically detect manuscripts composed by a piece of software called SCIgen, which randomly combines strings of words to produce fake computer-science papers. SCIgen was invented in 2005 by researchers at the Massachusetts Institute of Technology (MIT) in Cambridge to prove that conferences would accept meaningless papers.
SCIgen is free to download and use, and it is unclear how many people have done so. SCIgen’s output has occasionally popped up at conferences, when researchers have submitted nonsense papers and then revealed the trick.
Labbé showed how easy it was to add these fake papers to the Google Scholar database, boosting a fake scholar’s h-index, a measure of published output, to 94 — at the time, making him the world’s 21st most highly cited scientist.
There is a long history of journalists and researchers getting spoof papers accepted in conferences or by journals to reveal weaknesses in academic quality controls — from a fake paper published by physicist Alan Sokal of New York University in the journal Social Text in 1996, to a sting operation by US reporter John Bohannon published in Science in 2013, in which he got more than 150 open-access journals to accept a deliberately flawed study for publication.
This 2014 excerpt of Guardian LV, Feb 28, is by Grace Stephen.
Food wastage globally is at an all-time high. Americans are perhaps the most wasteful people in the planet’s history and also one of the most gluttonous. Over 35 percent of Americans can be classified as officially obese.
Within the United States one third of the 430 billion pounds of food produced annually is thrown away. The wastage was caused by spoilage, inadequate or incorrect cooking, or suffered natural shrinkage because of the loss of moisture. A large chunk of the wastage was also caused by people who did not like the food they bought and therefore simply threw it away.
Meanwhile, laws have been put into place that ban the feeding of homeless people in every city of the country.
After the drought in California, the region is unable to produce the usual amount of food; prices are set to skyrocket.
Ed. Notes: Food waste with widespread hunger must be the height of irony. It shows once again that our economic problem is not a matter of production but a matter of distribution. Get rid of subsidies and taxes and individual capture of natural values. Then everyone will have enough opportunity to prosper and avoid hunger. As for the already prosperous, maybe they need to pay more to have their wastes picked up from their curbside.
This 2014 excerpt of Global Research, Feb 28, is by Ezili Dantò.
Last May 10, Martelly-Lamothe, the US-picked Haiti president decreed the island of Ilavach to be property of the state. Konbit peyizan Ilavach (KOPI), the organization put together by the people of Ilavach to secure their interests say the taking of their lands is illegal and any development is not intended to benefit the island residents but foreigners. Residents would rather continue to eat yams, fresh fish, fruits, vegetables off his own ancestral land than have to get a wage job on the Island to service Northern tourists.
The Ilavach folks have no local representation. There has been no local elections, no parliamentary elections in Haiti since Michel Martelly took office with only 17% of the population voting. The Martelly-Lamothe government, instead of organizing required elections, has constantly postponed local and national elections.
Martelly created the local position – Ajan Egzekitif Enterimè or Interim Executive agent — and appointed the person to this position. This man points out people for intimidation, imprisonment, and even death.
Ed. Notes: Such displacement happens in many places, even close to the US. All for the profit from land. Yet land is our common heritage, and the rents it can command are our common wealth; they should not be low hanging fruits for the greedy and grasping. Never miss an opportunity to help resurrect the understanding Mother Earth is to benefit everyone equally.
This 2014 excerpt of MacroBusiness, Feb 27, is by Catherine Cashmore
The correct way to fund local schools would be via broad based and effectively administered land value taxation, which in its purest form – as advocated by the Classical Economist, Henry George – would result in a single tax on the unimproved value of land to replace all other taxes, which hamper productivity – significantly income tax.
The Henry Tax Review commissioned by the Government under Kevin Rudd in 2008 concluded that “economic growth would be higher if governments raised more revenue from land and less revenue from other tax bases” proposing that stamp duty (which is an inconsistent and inequitable source of revenue) be replaced by a broad based land tax, levied on a per-square-metre and per land holding basis, rather than retaining present land tax arrangements.
Therefore – when times comes that the ‘chatter’ around affordability, finally evolves into ‘real’ action – a broad based LVT should form an important part of both the debate, and solution.
This 2014 excerpt of USA Today, Feb 26, is by Hannah Hetzer.
It is a mistake to believe that the capture of drug lord, Joaquín “El Chapo” Guzmán Loera, will lead to a decrease in violence. Guzmán’s arrest will not dismantle the criminal networks involved in drug trafficking.
40 years of the war on drugs has not led to a decrease in drug consumption or supply on a global scale, yet it has led to the proliferation of drug cartels and crime associated with the underground market.
As long as there is an illicit market for drugs, there will be violent cartels to supply it. Ultimately, we need to depart from the repressive, militarized, and punitive methods of the past and get to the heart of tackling organized crime, with initiatives such as legal regulation, being spearheaded by Uruguay, Washington, and Colorado.
This 2014 excerpt of The Independent, Feb 25, is by Ben Chu.
Best of all would be a land value tax, requiring property owners to pay an annual levy based on the market value of the plot of earth beneath their home. This could potentially replace stamp duty, council tax, and even business rates. It would encourage more housebuilding by discouraging land hoarding, penalize those who leave properties empty, and ensure people paid for windfalls to their home values from new transport links etc. Sensible politicians should be all over it.
Ed. Notes: If you have to pay a tax, it’d be hard to pay a better one than the one on locations. It’s fair, because the value of locations is created by the surrounding society, and because we each owe compensation to our neighbors for excluding them from a part of Earth — to which we all have an equal right — just as our neighbors owe compensation to us. We should all pay land dues in and get rent dividends back.
Happily, paying land dues makes it possible to get rid of the counterproductive taxes on labor land capital, and getting rent dividends makes it possible to get rid of the wasteful and addictive subsidies to special interests.
So it’s great that the British press promotes this vital part of geonomics. May the press of other nations catch up!
A class of insecticides known as pyrethroids is increasingly found in the human body.
Children in particular are still widely exposed to an insecticide that was banned for household use over a decade ago—chlorpyrifos.
Pyrethroids are sprinkled over lawns, soaped onto pets, sprayed on offending vermin, and applied to our own persons in the form of lice-killing shampoos or mosquito repellents. They’re also used in fumigating drives against mosquitoes and in agricultural crops and nurseries.
Over 60 percent of people examined in the study tested positive for having pyrethroids in their system.
A possible health effect is endocrine disruption and autism; mothers of autistic children had shampooed their pets with antiflea and antitick shampoos during pregnancy.
Ed. Notes: Of course manufacturers should have to prove their products are safe, not toxic chemicals, before selling them, something they now don’t have to do adequately. In fact, the entire cozy relationship between business and government should be broken up. All society should raise the bar for moral behavior.
We should consense on paying land dues, rather than mortgages, and pay our neighbors or community, rather than sellers or banks. With such dues in place along with fees for social services, we should then abolish taxes. Taxes make us feel like serfs, like people who do not deserve justice, including the justice of safe, healthy products. And businesses will be in no position to complain, since they won’t have to pay taxes on their fair earnings, their employees, or their material goods.
Let’s replace this selfish outlook of profit at any cost with a fair return for honest effort.
This 2014 excerpt of Dirt Diggers Digest, Feb 25, is by Phil Mattera.
At least 75 percent of cumulative disclosed subsidy dollars for “economic development” have gone to just 965 large corporations, even though these companies account for only about 10 percent of the number of announced awards.
In dollar terms, the biggest recipient by far is Boeing, with a total of more than $13 billion, reflecting the giant deals it has gotten in Washington and South Carolina as well as more than 130 smaller deals around the country. The others at the top of the cumulative subsidy dollar list are: Alcoa ($5.6 billion), Intel ($3.9 billion), General Motors ($3.5 billion), and Ford Motor ($2.5 billion). A total of 17 companies have received cumulative subsidy awards worth more than $1 billion; 182 have received awards of $100 million or more.
The company with the largest number of awards is Dow Chemical, with 416. Following it are Berkshire Hathaway (310), General Motors (307), Wal-Mart Stores (261), General Electric (255), Walgreen (225), and FedEx (222). Forty-eight companies have received more than 100 individual awards.
The parent companies on the Fortune 500 alone account for more than 16,000 subsidy awards worth $63 billion.
Foreign-based corporations are three in the top ten (Fiat, Royal Dutch Shell, and Nissan) and another five in the next 15.
Ed. Notes: Is it wrong for politicians to give your money to people who don’t need it? Or is it wrong for us to give away the power to spend public money to politicians? Perhaps we should put the budget on the ballot. Or better yet, pay ourselves a citizen’s dividend from surplus common wealth. Then we could get rid of not just subsidies but taxes, too, and just levy fees and dues — the geonomic solution.
the annoying habit of seeing the hand of land in almost all transactions. In geonomics we maintain the distinction between the items bearing exchange value that come into being via human effort — wealth — and those that don’t — land. Keeping this distinction in the forefront makes it obvious that speculating in land drives sprawl, that hoarding land retards Third World development, that borrowing to buy land plus buildings engorges banks, that much so-called “interest” is quasi-rent, that the cost of land inflates faster than the price of produced goods and services, that over half of corporate profit is from real estate (Urban Land Institute, 1999). Summing up these analyses, geonomists offer a Grand Unifying Theory, that the flow of rent pulls all other indicators in its wake. Geonomics differs from economics as chemistry from alchemy, as astronomy from astrology.
a way to connect the dots. Making the cyber rounds is “The Cavernous Divide” by Scott Klinger, from AlterNet (posted March 21): “As the number of billionaires in the world expands, so does the number of those in poverty.” Duh. The yawning income gap is not news. Nearly every issue of our quarterly digest carries a similar quote. Yet the connection was worked out long ago by one of America’s greatest thinkers, Henry George, who labeled his masterpiece, Progress and Poverty. Techno- and socio-advances always enrich few and impoverish many. Yet progress also pushes up location values – the geonomic insight (is Silicon Valley cheaper now or more expensive?). Instead of taxing income, sales, or buildings, society could collect those values of sites, resources, EM spectrum, and ecosystem services via fees and dues, which would lower the income ceiling, and instead of lavishing corporate welfare, pay out the recovered revenue via dividends, which would jack up the income floor. Dots connected.
the study of the money we spend on the nature we use. When we pay that money to private owners, we reward both speculation and over-extraction. Robert Kiyosaki’s bestseller, Rich Dad’s Prophecy, says, “One of the reasons McDonald’s is such a rich company is not because it sells a lot of burgers but because it owns the land at some of the best intersections in the world. The main reason Kim and I invest in such properties is to own the land at the corner of the intersection. (p 200) My real estate advisor states that the rich either made their money in real estate or hold their money in real estate.” (p 141, via Greg Young) When government recovers the rents for natural advantages for everyone, it can save citizens millions. Ben Sevack, Montreal steel manufacturer, tells us (August 12) that Alberta, by leasing oil & gas fields, recovers enough revenue to be the only province in Canada to get by without a sales tax and to levy a flat provincial income tax. While running for re-election, provincial Premier Ralph Klein proposes to abolish their income tax and promises to eliminate medical insurance premiums and use resource revenue to pay for all medical expense for seniors. After all this planned tax-cutting and greater expense, they still expect a large budget surplus. Even places without oil and gas have high site values in their downtowns, and high values in their utility franchises. Recover the values of locations and privileges, displace the harmful taxes on sales, salaries, and structures, then use the revenue to fund basic government and pay residents a dividend, and you have geonomics in action.
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.
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.
one of many words I coined over 20 years ago: geoism, geonomics, geonomy, geocracy, etc – neologisms that later others came up with, too. CNBC once had a Geonomics Show, and Middlebury College has a Geonomics Institute. If “economy” is literally “management of the household”, then geonomy is “management of the planet”. The kind of management I had in mind is not what CNBC was thinking – top-down. My geonomics is not hands-on, interfering, but hands-off, organic. It’d strive to align policy with natural processes, similar to what holistic healing does in medicine, what organic farming does in agriculture. Geonomics attends to two key components: One, the crucial stuff to track is fat – or profit, especially profits without production, such as rent, or all the money we spend on the nature we use. Society’s surplus is the sine qua non for growth, needed to counter death – not merely more, but sustainable development, more from less. Two, the basic process to respect is the feedback loop. These let nature maintain balance automatically and could do the same for markets, if we let them. Letting them would turn our economies, now our masters, into a geonomy, our servant, providing us with prosperity, eco-librium (to coin a term) and leisure, time off – a hostile environment for economan but a cradle for a loving and creative humanity.
more transformation than reform; it’s a step ahead. Harvard economics students this year did petition to change the curriculum, in the wake of the English who caught the dissension from across The Channel. French reformers, who fault conventional economics for conjuring mathematical models of little empirical relevance and being closed to critical and reflective thought, reject this “autism” – or detachment from reality – and dub their offering “post-autistic economics”. Not a bad name, but again, academics define themselves by what they’re not, not by what they are, unlike geonomists. We track rent – the money we spend on the nature we use – and watch it pull all the other economic indicators in its wake. We see economies as part of the ecosystem, similarly following natural patterns and able to self-regulate more so than allowed, once we quit distorting prices. To align people and planet, we’d replace taxes and subsidies with recovering and sharing rents.
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 discipline that, compared to economics, is as obscure as Warren Buffett’s investment strategy, compared to conventional investment theory, about which Buffett said, “You couldn’t advance in a finance department in this country unless you taught that the world was flat.” (The New York Times, Oct 29). The writer wondered, “But why? If it works, why don’t more investors use it?”
Good question. Geonomics works, too. Every place that has used it has prospered while conserving resources. Yet it remains off the radar of many wanna-be reformers. Gradually, tho’, that’s changing. More are becoming aware of what geonomics studies – all the money we spend on the nature we use. Geonomics (1) as an alternative worldview to the anthropocentric, sees human economies as part of the embracing ecosystem with natural feedback loops seeking balance in both systems. (2) As an alternative to worker vs. investor, it sees our need for sites and resources making those who own land into landlords. (3)As an alternative to economics, it tracks the trillions of “rent” as it drives the “housing” bubble and all other indicators. And (4) as an alternative to left or right, it suggests we not tax ourselves then subsidize our favorites but recover and share society’s surplus, paying in land dues and getting back “rent” dividends, a la Alaska’s oil dividend. Letting rent go to the wrong pockets wreaks havoc, while redirecting it to everyone would solve our economic ills and the ills downstream from them.
People must learn to stop whining so much and feel enough self-esteem to demand a fair share of rent, society’s surplus, the commonwealth.