New Book: The Quest to Know Earth’s Worth
Fill in the blindspot re social surplus, its role in economies and politics; you'll never see mortgages the same way again.
March 5, 2021
Jeffery J. Smith

Counting Bounty: the quest to know the worth of Earth

Blindspot. It’s true. Something can be in the eye’s field of vision yet the brain does not register it. One recent example is the gorilla experiment in which a guy in a gorilla suit strolled through a group of people focused on bouncing a basketball to each other. About half the bouncers never noticed the gorilla. It’s not just physical objects that the brain misses. It’s also some basic truths. Like land.

What would it mean to fill in that particular blindspot, to see the world completely, to see land’s value? And to see the sum precisely?
* You’d see the size of social surplus which the mere presence of society produces.
* You’d see its fluctuations leading the business cycle, and be ready to time your big buys and your big sales. And …
* You’d see that the traditional labor-capital conflict has its roots in another blindspot—the ordinary transaction of rentier charging rent-payer.
That stat would add hugely to your storehouse of useful knowledge.

Despite the utility of a sum for how much we as society spend on the nature we use, you can’t look it up. No public agency tracks it. Nor does any academic institute or think tank. The three most important things in real estate do not exist in mainstream economics. For conventional economists, rent is anathema. Despite the fact the public funds public agencies and universities, they keep from the public a stat everyone needs to know—the value of sites, natural resources, plus the EM spectrum.

It’s not that they keep it hidden (as far as we know). Rather, they don’t bother to figure it out. Like when you see workers leaning on their shovels at a road repair site—your tax dollars at work.

Taboo Total

Actually, occasionally, a credentialed economist safely in an academic sinecure does get carried away by curiosity and does publish an estimate of land value. Not a very accurate estimate, so not all that useful, and worse, it creates a false worldview in the mind of any innocent reader. Typically, the author leaves out something, like rural land, or uses figures not based on transactions but on, say, estimates by owners or businesses who have a vested interest not in accuracy but in avoiding taxes or attracting buyers or whatever.

You can’t hardly find a figure and what you can find is distorted. Another trick academics use is to calculate land value by subtracting from the total property value (land plus building) the cost of a brand new hypothetical house for that site. That’s like calculating the value of a driveway by subtracting the value of a brand-new Camry. Crazy. It’s like the “experts” intentionally belittle the value of land, like they want people to keep ignoring it. Why?

And it gets ever harder to even look for a decent number. Used to be, you could turn to somebody. No longer. Agencies that have quit tallying rent run the gamut from private appraisers and public assessors to the Census Bureau, GAO, OMB, Federal Reserve, the Lincoln Institute, and now the American Bankers Association, besides Zillow. Why this retreat? It’s as if a total for land value were kryptonite.

You can guess why. Rent raises fortunes and rentiers rule. It’s in their interest to downplay the fact that the worth of Earth—something they did not make nor purchase from its maker—is generated by the presence of society. Yet this something for nothing makes only a few members of society, not all, exquisitely rich, generation after generation.

One of their institutions rules the discipline—the Federal Reserve, which is neither federal nor a reserve. However, they are the biggest employer of economists and control the major journals. If you expect a paycheck for doing economics, with very few exceptions, you toe the line and turn a blind eye to Earth’s worth.

A Parched Field of Knowledge

But look what damage their high-handedness has wrought. Not knowing the size or flow of all rents, economists can neither predict—which is the essence of science—while geonomists (rent-trackers) can and regularly do. While traditionalists who’re more cautious than curious well manage to keep themselves in the happy middle class, none offer the public any functional policies. Especially taboo is the public recovery (and subsequent disbursal to the citizenry) of socially-generated location value, the fat that makes mortgages so remunerative to banks.

Conventional economists offer a ton of different indicators, but none for surplus, none for leisure which is supposed to be the whole point of progress. The number they leave out—land value—could handle all of that and more.

Overlooking a grand portion of how economies actually work, sometimes fail, and what would successfully address the problem may be why economists suffer physics envy, over-mathematize their arcane theories, call their flimsy statistics “data”, and why even insiders critique their own discipline.

If the study of who does the work and who gets the wealth is ever to become a science, then, just as alchemy became chemistry and astrology became astronomy, economics must graduate to geonomics. As all great paradigm shifts came from outsiders, Kuhn famously noted, so it must be up to a gadfly outsider to put the study of production, distribution, consumption, and protection on a sound footing. Probably some embarrassed economists are longing for the dawn of just such a new day.

Say we knew and regularly updated a tally for the worth of all Earth in America. Other than investors, who else could put that total to good use?
* Environmentalists could show the difference in value between regions, where ecosystems are well treated versus not.
* Urban advocates could show what actually causes unaffordable housing is what houses sit on.
* Laborists could show what widens the gap between wages and profits.
* Reformers could show where corruption is greatest versus where prosperity is widespread.
It’d be a handy number to have.

A Derived Reform

To count it all, you’d get the annual rental value of all lands including commercial, residential, agricultural, sylvan, mineral, even spectral (the electromagnetic spectrum) and geo-synchronous orbits. And if you want all the value of all assets never produced by anyone’s labor or capital, then you’d also measure government granted privileges like corporate charters, utility franchises, monopoly patents, and the like. Those require no more labor than lobbying, no more capital than campaign contributions.

Even without knowing an accurate stat for all the rents in their region, some jurisdictions, due to historical accident, have gone ahead and tapped into it. That is, they shifted their property tax off buildings, onto locations. Interestingly, unlike other tax reforms, gathering up site value did not shrink its tax base but expanded it.

Further, every single one of those jurisdictions did well. To various degrees, they filled in vacant lots, beautified the town, generated jobs, upped wages, reversed inflation, attracted investment, improved the land use pattern. What’s not to like?

Some, like Singapore, even paid dividends. Rent shares paid to all residents vastly beat the much talked about Basic Income, which does not exist anywhere while rent dividends do, such as the Alaska oil dividend. The sum of all rents in a region—both natural and governmental—is so great that the dividend becomes mightily huger than an assistance to help meet basic needs. Nor is it a budget expenditure. It’s a dividend, a share of a surplus. And while it solves poverty, it’s not charity but an actualization of justice; we’d reap as together we (unknowingly) sow. We’d stop serving the economy and let it serve us, lose the identity of worker (peon in the past) and gain the identity of player, move on from the Protest Work Ethic and adopt the Polynesian Play Ethic, lock the hood on the economy (and polity) and finally become fully human.

Not a bad outcome for toting up the worth of Earth in America. How much would it be this year? Check it out at Counting Bounty with its 900 references at Oregon publisher Trine Day—and fill in that darn unconscious blindspot. Your future awaits you.

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Jeffery J. Smith

JEFFERY J. SMITH published The Geonomist, which won a California GreenLight Award, has appeared in both the popular press (e.g.,TruthOut) and academic journals (e.g., USC's “Planning and Markets”), been interviewed on radio and TV, lobbied officials, testified before the Russian Duma, conducted research (e.g., for Portland's mass transit agency), and recruited activists and academics to A member of the International Society for Ecological Economics and of Mensa, he lives in Mexico. Jeffery formerly was Chief Editor at