Here's an issue we shouldn't lose sight of. There are many reasons for supporting a tax on land, and there are noises from various quarters that suggest such a policy might be gaining the sort of support it needs to receive serious political attention.Well, yes, I know you are not going to take me seriously if I follow up that enthusiastic opening by telling you that Land Value Tax is to be debated at the Liberal Democrats annual conference this year. But it is fairly historic that a government party should debate in public this very radical approach to taxation.
Of course there are many variants of how a tax on land might work and why it might be useful. To liberal economists, those who live from rents are not economically productive, so land tax encourages them to put their land to the most productive use and is thus a stimulus to economic growth. To more redistributively minded conventional economists, the windfall gains from planning decisions should not be privatised to developers but shared with the community: a tax on land values enables this.
But the reason I like land value tax is that I believe it would operate like a transitional demand. While it could be seen to be part of a market approach to the economy, in fact land ownership enables people to escape the market system and meet their needs directly from the land. Hence any move that suggests that land is a public resource, rather than a private one, and implies the value of land as a part of the common wealth moves us towards the non-market society that will maximise human happineess and protect the planet.
If this debate is new to you, you might like to read a special issue of the newsletter Tax Justice Forum which focused on the issue. If you're in the mood for something a bit more rousing and rhetorical you can check out a short speech I gave at the House of Commons during a meeting on the same theme several years ago.
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In a true Gaian economics, land wouldn't be owned at all!
ReplyDelete102 years after Lloyd George's budget - still better late than never. The Lib Dems can sing their Land Song truthfully now. "Make them pay their taxes on the land just like the rest"
ReplyDeletehttp://www.historyworkshop.org.uk/the-land-song/
The penultimate paragraph is quite scary.
ReplyDeleteA true free market * is the most social activity known to mankind. I'm astonished the author cannot see this.
What thing brings people into association more than any other thing? Trade and exchange. Both sides come together willingly because both sides win.
A world without a market would be the most anti social scenario I could ever think of. Besides its an impossible scenario. Can anyone imagine life without trade and exchange. Even 2 people on a desert island do it by nature.
The problem with half understanding the principles of LVT is that the thinker remains in the belief that there will still be losers. But the whole point is everyone will win. All wages go to the producer and worker. All rents go to supporting society. That's it.
* Which has yet to exist, but would be the exact effect of collecting all rents for public revenue and abolishing all taxes. Today we do the exact opposite, exactly to protect private property in land. The worlds primary social organisation. We all vote for it. Banks being the biggest land lords ever. Mortgages. We pay them rent in the true economic sense. Root cause of poverty, economic paroxism... and now climate change. People in fear of rents persistently rising faster than wages do not use the most clean energy. They use the cheapest dirtiest energy. Its wrong but they want to keep feeding their family right?
A true free market *
ReplyDelete* Which has yet to exist,
That's the whole point isn't it? A Free Market enables those with the power/resources to manipulate it for their own benefit at the expense of others.
Do you see an alternative?
To the author, I'm not sure I'd agree with all your proposals throughout the various articles I've read, but some are very imaginative and well worth exploring. I appreciate the diversity of thought you bring to the wider discussion. I suppose it wouldn't be too interesting a world if everyone agreed on everything.
ReplyDeleteTo the last commentor, I'm truely saddened that one could think that market exchange is the most fundamental expression of human social interaction. Most individual interaction with the corporate world is highly impersonal - whether it be the contract and direct debit of the insurance transaction or the impersonal contact at a large supermarket where we buy the necessities in order to survive. Hell, even the check out person is being replaced by a machine at the "advanced" and super "efficient" coal face of modern business. The bureaucracy of the private sector is souless, humanly inefficient and unsatisfying beyond description.
The reduction of all human activity to the common denominator of the transaction, a calculated numeracy of debit and credit that is based solely on the criteria of money, is hardly satisifying. It is so unsatisfying that people feel the need to continually buy stuff just to get a temporary buzz from purchasing, but buying stuff hardly fills the social void that is so apparent in modern socities that have modeled themselves upon some idealised notion of a corporate state.
This is hardly the win-win situation you try to argue for in your commentary. Also, the globalised economy has created many losers across many socities. To argue otherwise would be disingenuous.
I get far greater satisfaction from the human contact that comes from swapping jam for honey, or indeed plucking a cabbage from my front garden and giving it to a neighbor. The gratis transaction may have a debit and credit quality, but it is a quality not bounded by money. It is a quality that goes deeper in creating bonds in the community. Money can't buy it.
I suppose what is scary is that there are so many people in our society who hold your opinion,
as you rightly point out. The notion that our brief sojourn on this planet is one whereby those who collect more material assets are deemed more worthy speaks volumes in itself. It is a culture that seems to be resulting in a nihilistic social temperament.
But I suppose the truely scary results, as I've witnessed first hand on Wall Street as a risk analyst, was how people become so used to treating all relationships as transactions when adopting the notion that life is merely a reflection of the market or some business model - spanning relationships from friendship to deeper intimacy. The marketisation of relationship as a transaction creates no meaning but rather trivialises human interaction. It debases relationships.
from: Make Do and Mend
weggis
ReplyDeleteA market is either free, or it is not free. Which one are you talking about?
One that is free is inherently just. What else could it possibly be?
What we actually have today is a fully monopolised market, which we have been brainwashed into thinking is free, but clearly is not at all.
The largest monopoly enslaving the entire civilised world is private property in land. Protected fully by taxation on the labour and enterprise of the worker and producer. A kind of modern day Roman slavery.
The Robin Smith Institute: A slave who buys freedom is like a person who buys a house
The worker and true capitalist(not landowner) should be joining forces and taking the fight to the landowners(banks). Instead of fighting a futile battle against each other while the real enemy smokes cigars and laughs at our ignorance.
The alternative is simple and radical:
1) Abolish private property in land (LVT)
2) Abolish all taxation
The result is freedom and equality, finally.
The problem is this is political dynamite because the most powerful class owns ALL the land(banks). And we the people allow our votes to be bought cheaply by them.
Only the people have the power to overwhelm them. But evidently the people do not aspire to freedom.
I like the title of this blog:
ReplyDelete"without tackling the economic system and its ideological defenders"
Does that include climate change idealogues? I'm a believer too.
"Economics is only dismal because"
... of 3 false idealogical economic theories shared by both left and right wing politics, in fact it unites them unfortunately:
1) that population is larger than we can provide for, or we are running out of things
2) that poverty, vice, and misery are the result of natural laws and are actually the means by which civilization advances
3) that human progress occurs through slow genetic changes
THESE are why we are unable to get anywhere... at the root.
We are not running out of anything at all. There is more now than ever. The more people, the more wealth
Root cause of climate change is fear of poverty. So we should be dealing with poverty to resolve climate change. Climate change is an effect of a deeper cause
The idea that the life of the species is more important than the individual means moral values of utterly lost on us. The individual is enslaved by the false battle between left and right, when it is oligarchy and kleptocracy, unjust social organsiation that are at the root.
Can you see this?
@ Robin Smith
ReplyDeleteOne that is free is inherently just. What else could it possibly be?
UNJUST! The law of the Jungle? That's what they mean by Free.
But if you get to impose your model and rules (abolish tax and land ownership) you will have restricted its ability to operate freely. It might be a better system, fairer and more equitable, but it would not be "free".