Land Value Taxation: Rebuttals to Common Objections

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Offline Honor18

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #120 on: August 26, 2013, 01:53:28 PM »
I would ask anyone interested to go to you tube today and look at this video ... the title itself will tell you what it concerns but the video explains the inevitable destruction of the US dollar and therefore our way of life Titled

The Crash--Coming Financial Collapse of America 

When you look at the deficit which on "the books" say near 17 trillion id actually way above that when you do the research ...do you think there would ever be a time where America will be able to pay that ? Look at the value of Gold and Silver which has exploded over the last year or so it should tell you that the 1% is buying Gold and Silver now because it has worth to any nation in the world so instead of holding onto the "petro dollar" they are instead buying a tradable commodity that any nation would want and will have value.
     Look at what happened the last time we went through this aka the Great Depression ... I know its before most of our time however there is a lesson to be learned from the cycle that was started there ...
     Look at the NDAA law signed earlier this year .. do you think you are exempt from this law ?
Look at all the exercises going on throughout America concerning Martial Law aka Miami just last week ...Do you think they are doing these exercises here in the US for nothing ?
      Imagine going to sleep and waking up at 7am and finding out that the money you have in retirement or savings is now worth exactly 0 .... where will you get food to feed your family ?
       Could that be what the Fema camps are for ? Is there a reason other than the nut jobs that are killing people in schools for our Gov. to attempt to disarm the American public.
      The only way for us to save this nation is to stand up as the American people together and as one to take back this country from the Greedy corrupt Corporations that have effectively taken our way of life over ..from your everyday way of life to the supposed politicians that we put in office to look out for our way of life ... did you contribute to the 7 billion dollar campaign that just happened  ? No you did not companies like Microsoft and GM and the hundreds of others "corporations" got them elected by supplying them with millions of dollars to influence your vote.
     Twenty years ago this was conspiracy theory today in August 2013 its Reality ....My opinion and take it as you may but Reality is reality and the information is out there waiting on you to find it and use it to our advantage ... Big Government is hoping you ignore it or just do not act on it by repressing you with so may problems in your daily lives and the propaganda on air everyday in the so called media.
     This may seem a rant but its not its a wake up call that needs to be shared with everyone in America in the hope that we can change the balance of power back to the people of the United States

Offline Geolibertarian

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In New York, Having a Job, or 2, Doesn’t Mean Having a Home
« Reply #121 on: October 12, 2013, 10:59:47 AM »
http://www.nytimes.com/2013/09/18/nyregion/in-new-york-having-a-job-or-2-doesnt-mean-having-a-home.html?pagewanted=all&_r=0

In New York, Having a Job, or 2, Doesn’t Mean Having a Home

By MIREYA NAVARRO
The New York Times
September 17, 2013

On many days, Alpha Manzueta gets off from one job at 7 a.m., only to start her second at noon. In between she goes to a place she’s called home for the last three years — a homeless shelter.

“I feel stuck,” said Ms. Manzueta, 37, who has a 2 ½-year-old daughter and who, on a recent Wednesday, looked crisp in her security guard uniform, waving traffic away from the curb at Kennedy International Airport. “You try, you try and you try and you’re getting nowhere. I’m still in the shelter.”

With New York City’s homeless population in shelters at a record high of 50,000, a growing number of New Yorkers punch out of work and then sign in to a shelter, city officials and advocates for the homeless say. More than one out of four families in shelters, 28 percent, include at least one employed adult, city figures show, and 16 percent of single adults in shelters hold jobs.

Mostly female, they are engaged in a variety of low-wage jobs as security guards, bank tellers, sales clerks, computer instructors, home health aides and office support staff members. At work they present an image of adult responsibility, while in the shelter they must obey curfews and show evidence that they are actively looking for housing and saving part of their paycheck.

Advocates of affordable housing say that the employed homeless are proof of the widening gap between wages and rents — which rose in the city even during the latest recession — and, given the shortage of subsidized housing, of just how difficult it is to escape the shelter system, even for people with jobs.

“A one-bedroom in East New York or the South Bronx is still $1,000 a month,” said Patrick Markee, senior policy analyst with the Coalition for the Homeless, an advocacy and housing services group. “The jobs aren’t enough to get people out of homelessness.”

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #122 on: October 12, 2013, 05:48:39 PM »
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Re: In New York, Having a Job, or 2, Doesn’t Mean Having a Home
« Reply #123 on: October 16, 2013, 12:15:48 PM »
http://www.nytimes.com/2013/09/18/nyregion/in-new-york-having-a-job-or-2-doesnt-mean-having-a-home.html?pagewanted=all&_r=0

http://www.theonion.com/articles/bloodsoaked-mayor-bloomberg-announces-homelessness,34224/?ref=auto

Blood-Soaked Mayor Bloomberg Announces Homelessness No Longer A Problem In New York City

The Onion
October 15, 2013

NEW YORK—Drenched in drying blood and limping slightly, New York City mayor Michael Bloomberg triumphantly stated this morning that the city’s longstanding homeless problem had finally been solved. “Homelessness is over—it’s not a problem anymore,” a winded Bloomberg said to a City Hall press conference while gripping the lectern tightly to prevent his hands from shaking. “I fixed the problem. Problem solved.” When asked by reporters if permanent housing had been provided for the city’s 50,000 homeless, Bloomberg assured them the new lodgings were quite permanent.
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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London rents are so high it is now cheaper to live in BARCELONA and commute in
« Reply #124 on: October 28, 2013, 08:04:47 PM »
http://www.dailymail.co.uk/news/article-2477291/London-rents-high-cheaper-live-BARCELONA-commute-heres-.html

London rents are so high it is now cheaper to live in BARCELONA and commute in (and here’s how…)

*  Sam Cookney did the sums after becoming sick of rent prices in London
*  He found it would be cheaper live in Spain and fly to his job in the City
*  A four day commute from Europe worked out at £339 per-month cheaper


By AARON SHARP
The Daily Mail
October 26, 2013

Rent in London is so high that one young professional has worked out it would be cheaper live in Barcelona and fly to work.

Social Media manager Sam Cookney, 30, wanted a less expensive way of travelling to his office near Liverpool Street station.

What he found was an unlikely solution: it would be more cost effective to relocate to the sun-kissed coast of north east Spain, more than 700 miles away.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

EvadingGrid

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http://www.dailymail.co.uk/news/article-2477291/London-rents-high-cheaper-live-BARCELONA-commute-heres-.html

London rents are so high it is now cheaper to live in BARCELONA and commute in (and here’s how…)

*  Sam Cookney did the sums after becoming sick of rent prices in London
*  He found it would be cheaper live in Spain and fly to his job in the City
*  A four day commute from Europe worked out at £339 per-month cheaper


By AARON SHARP
The Daily Mail
October 26, 2013

Rent in London is so high that one young professional has worked out it would be cheaper live in Barcelona and fly to work.

Social Media manager Sam Cookney, 30, wanted a less expensive way of travelling to his office near Liverpool Street station.

What he found was an unlikely solution: it would be more cost effective to relocate to the sun-kissed coast of north east Spain, more than 700 miles away.

[Continued...]

I'm giving that one some thought.....

I wonder how the other typical costs compare, such as Electric.

Offline Geolibertarian

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This is what inevitably happens when you let either Keynesians or Austrians institute and impose an anti-Georgist tax system -- a system whereby publicly-generated land rent is left mostly if not entirely untaxed, thereby forcing governments to rely instead upon the privately-created values of labor and capital goods as the primary source of public revenue...

-------------------------------

Wall Street slumlords’ outrageous new scheme: How they could wreck the economy again

Remember mortgage-backed securities and the financial crisis they caused? This latest gambit will put you in shock

David Dayen
SALON
Nov. 6, 2013



You’d think that investors would run away from a new Wall Street innovation as fast as Congress runs away from a good idea. But instead, they’re flocking to the latest product peddled by large banking interests, even though they look almost exactly like the mortgage-backed securities that were a primary driver of the financial crisis. These new securities, backed by rental payments, also have real-world implications for millions of renters, who could end up turning in their monthly checks to Wall Street-based absentee slumlords.

Over the past couple of years, private equity firms and hedge funds have bought up over 200,000 single-family homes, mostly discounted foreclosed properties in communities wrecked by the housing crash, such as Phoenix, Atlanta, Tampa, Sacramento, Los Angeles and Riverside, Calif. They have spent billions to scoop up these vacant homes at fire-sale prices, renovate them, and rent them out, promising investors double-digit annual returns on the rental revenue. Private equity firms like Blackstone, which owns more than 40,000 single-family homes, think they can build an entirely new asset class out of this scheme, controlling the rental market for single-family homes. The irony is rich: Wall Street created the conditions for millions of foreclosures, then they sweep in to buy up the homes and rent them out, often to the same people they kicked onto the street.

In order for this to work, firms need cash to outbid the competition. So Blackstone teamed with Deutsche Bank, Credit Suisse and JPMorgan Chase to put together the first-ever rental revenue bond, named “Invitation Homes 2013-SFR1.” Basically, Blackstone took out mortgages with the banks on 3,207 of its rental properties, in exchange for $479 million in cash, and they will forward rental payments to the bondholders to pay back the loan.

[Continued...]

-------------------------------

^^  Have you heard either Wall Street Democrats OR "Tea Party" Republicans pledging to sponsor legislation to put a stop to this rent-seeking operation?

If so, what?

If not, why do you suppose that is? Aren't those two political groups supposed to be "opposites"?
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Faile Street: The Human Cost of Foreclosure
« Reply #127 on: November 19, 2013, 10:00:21 AM »
Yet another illustration of what happens as an inevitable consequence of an anti-Georgist tax system...

     https://www.youtube.com/watch?v=1QwtOF8Lwqk (Faile Street: The Human Cost of Foreclosure)
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Are You a Real Libertarian or a ROYAL Libertarian?
« Reply #128 on: November 20, 2013, 02:43:30 PM »
http://geolib.com/essays/sullivan.dan/royallib.html

Are you a Real Libertarian, or a
ROYAL
Libertarian?

"Queen Elizabeth II, head of state of the United Kingdom and of 31 other states and territories, is the legal owner of about 6,600 million acres of land, one sixth of the earth’s non ocean surface.

"She is the only person on earth who owns whole countries, and who owns countries that are not her own domestic territory. This land ownership is separate from her role as head of state and is different from other monarchies where no such claim is made – Norway, Belgium, Denmark etc.

"The value of her land holding. £17,600,000,000,000 (approx)."



              Pyramid of Royal Libertarian System



http://www.youtube.com/watch?v=lDMenqKCXdw (THE CORPORATION [10/23] Boundary Issues)

http://www.youtube.com/watch?v=4CdyezX3T08 (Webster Tarpley & Alex Jones: Royals and Obama)

http://www.youtube.com/watch?v=6ZkfmY1PMng (Ricardo's Law ~ The Great Tax Clawback Scam)


Are you starting to make the connection yet?
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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End the 1 percent’s free ride: Taxing land would solve America’s biggest problems

Want a real overhaul of the tax code? Here's an elegant way to reduce inequality and mitigate poverty -- in one tax

Jesse Myerson
SALON
November 22, 2013



Appealing to the overwhelming majority of Americans who believe the tax code is so complex that it needs “major changes or a complete overhaul,” Senate Finance Committee Chairman Max Baucus, D-Mont., and House Ways and Means Committee Chairman Dave Camp, R-Mich., have adorably started a joint Twitter handle: @simplertaxes. The bipartisan love fest is no doubt a heartfelt effort, but not very convincing from men who acquired the fancy titles by opening and maintaining loopholes for the ownership class. Baucus’ hot-off-the-presses tax reform proposals predictably simplify the code very little.

At present, neither party advocates the tax code so elegant it can reduce inequality, mitigate poverty, stimulate productivity, prevent asset price bubbles, stem community-shredding gentrification and drain the distended Wall Street cabal of its ill-gotten gains – in just one tax.

Land value. If we want a real overhaul/simplification of the tax code, the way to do it is to tax land value. It might be the only tax we need. No sales tax. No income tax. No payroll tax to fill a Social Security trust fund. No corporate income tax that, as we can plainly see, offshores profits. No need to tax labor and industry at all. Just tax the stuff that humans had nothing to do with creating, and therefore have no basis to claim ownership over at all. You’ll find that almost all of it is “owned” by the fabled 1 percent.

And boy are they sucking a lot of money out of it. By far the most valuable asset form in the U.S. is real estate, and the majority of that is the value of the land, as distinct from the value of the human-made buildings. Economist Michael Hudson has assessed that the land value of New York City alone exceeds that of all of the plant and equipment in the entire country, combined. No one put any enterprise or cost into producing the land’s value – they simply bought it when it was cheap, sold it when it was dear, and waited for the check. “They” are the Finance, Insurance and Real Estate (FIRE) sector, and they capture 40 percent of the United States’ profits, despite the complete passivity of their profit-accumulation method.

Not only would a land value tax (LVT) drastically shrink that Wall Street bloat, it would have prevented the housing bubble in the first place. Land, after all, was the speculative commodity at play, not the houses themselves, which, as “Arrested Development” incisively suggested, were a bunch of crap. With an LVT, the cookie-cutter McMansions in suburban housing developments would only be worth the cost of their cheap paneling, artificial marble and the rest of it. Without one, they were wrongly assessed as being worth the value of the land they stood upon, which speculators bid up and up and up.

An LVT would stimulate urban property development without incurring the socially catastrophic ethnic displacement pattern we call “gentrification.” As that noted far-left rag the Economist notes, “Property developers … would be less inclined to hoard undeveloped land if they had to pay an annual levy on it.” Despite this, the new developments wouldn’t push rents up throughout the rest of the neighborhood, because the increased land value would be taxed. The rest of the apartment buildings in the area didn’t get any nicer. So why should they cost more? Urban land, scarce by definition, is very valuable. There is no reason to let a small group of rich landlords extract its value, when what created the value are parks, subways, local restaurants and other things the landlords didn’t provide.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

EvadingGrid

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #130 on: November 23, 2013, 06:51:49 AM »
I really do understand, as our archery field and the football and cricket pitches have been sold off to large developers in what they call "Land Banking" deal. It stinks of corruption, as none of the residents want, what is a historic village dating back to the Doomsday Book being turned into a large urban blob.

However being honest, because the politicians are so, so corrupt, it would soon turn into a tax the poor, and loopholes for the rich. Property Developers would get immunity, but small family builders would be penalized. The endless lies and bribery would continue unabated. Politicians and Officials use laws drafted to protect the people as a means of extorting bigger bribes.

Which brings me to conclude, that there are many, many, remedies, but until we stop voting for lesser evils, and demand a fair just and honest governance, by the people for the people, we are pretty well stuffed.




Land banking
https://en.wikipedia.org/wiki/Land_banking


https://en.wikipedia.org/wiki/Land_banking

Offline Geolibertarian

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #131 on: November 23, 2013, 08:14:04 AM »
However being honest, because the politicians are so, so corrupt, it would soon turn into a tax the poor, and loopholes for the rich.

If you ever get a chance to read the following book, you'll find that that simply isn't the case...

     http://www.schalkenbach.org/store.php?crn=93&rn=387&action=show_detail

    

Your point obviously applies to the income tax, because even a minimum wage burger-flipper has an "income." But you'd be hard-pressed to find one who owns land. That's why landed aristocrats have always financed politicians who support taxing the value of labor (whether directly via income tax or indirectly via sales tax) instead of the value of land. Income can be hidden or moved offshore; land cannot.
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

EvadingGrid

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #132 on: November 23, 2013, 08:47:42 AM »
If you ever get a chance to read the following book, you'll find that that simply isn't the case...

     http://www.schalkenbach.org/store.php?crn=93&rn=387&action=show_detail

    

Your point obviously applies to the income tax, because even a minimum wage burger-flipper has an "income." But you'd be hard-pressed to find one who owns land. That's why landed aristocrats have always financed politicians who support taxing the value of labor (whether directly via income tax or indirectly via sales tax) instead of the value of land. Income can be hidden or moved offshore; land cannot.

I hear what your saying.

However, the ownership of land can, and is hidden by that pesky 1%. The middle classes, family farmers, and other nice people would stand 0% chance of avoiding a Land Tax.

I confidently predict that large scale property developers, speculating on land and driving the prices up would be exempt. Other nasties would hide the ownership using off shore trusts, bogus charities and all manner of shenanigans to avoid taxes.

The problem as I see it, is not the idea of taxation of land, but the implementation by the politicians.

Consider why income tax does not work, as it crucifies the poor and middle class, yet the elite who in theory should be paying the most walk away scot free.

Its the implementation that terrifies me, because the politicians are so awfully corrupt.

Exemptions would inevitably given to those who own millions of acres of

Forrest, ( to save the planet excuse )
Building Land, ( people need houses excuse )
Etc...

What I am saying is that it does not matter how noble, perfect or pure the idea proposed, that until we eliminate the corrupt politicians and hand power back to the people, all tax legislation ideas are doomed.

 

Offline Geolibertarian

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #133 on: November 23, 2013, 08:53:19 AM »
What I am saying is that it does not matter how noble, perfect or pure the idea proposed, that until we eliminate the corrupt politicians and hand power back to the people, all tax legislation ideas are doomed.

You're preaching to the choir, dude, that's why (nearly half a decade ago) I devoted an entire thread to election reform...

     http://forum.prisonplanet.com/index.php?topic=81509.0


8)
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

EvadingGrid

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #134 on: November 23, 2013, 08:59:17 AM »
You're preaching to the choir, dude, that's why (nearly half a decade ago) I devoted an entire thread to election reform...

     http://forum.prisonplanet.com/index.php?topic=81509.0


8)

I know, but there are still a ton of people around here that think that some professional bribe collector is gonna save them....... Seems like every five minutes some naive fool is asking us to support lesser paid shill as the solution or to vote for "sold out son" for president.


Offline Geolibertarian

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Land value tax – the best of all possible taxes
« Reply #135 on: November 29, 2013, 04:15:23 AM »
http://moneyweek.com/land-value-tax-best-possible-taxes/

Land value tax – the best of all possible taxes

By: Merryn Somerset Webb
MoneyWeek
10/10/2013

What gives a piece of land its value? Why is a 500 square-foot spot in London worth more than 500 acres of land in Angus? The answer is obviously its location.

The value of a bit of land is not in the land itself, but in the location of that land. And what gives the location value is what is going on around it. Think good transport links, good schools (a house in the UK by a good school is worth anything from 5 to 20% more than one near a bad school), hospitals and the infrastructure to provide jobs.

This brings us to the key question: who facilitates the provision of all these services? The answer to that, of course, is the taxpayer, via the state. But if it is the state that gives land some of its value (clearly there is also value in non-state provided things, such as beauty and mineral rights), why is it that all of that value generally accrues to individual landowners, rather than to the state?

That, in a nutshell, is the argument for land or location value tax (LVT).

An LVT is levied not on the value of a property but on the value of the land that property sits on. After all, it is not the actual bricks and mortar that make a flat in, for example, London’s One Hyde Park worth £6m-plus, it is the land on which it sits. So the LVT is just an attempt to collect tax on a regular basis on what economists used to call the ‘unearned betterment’ part of the value of a property – the part that is nothing to do with the actions of the owner and everything to do with the actions of the community.

In theory, it is not just an excellent tax, but the best of all possible taxes.

Once the initial valuations have been done, it is phenomenally easy to collect, and all but impossible to avoid. It also discourages speculation and stops in its tracks the endless cycle of investment in land and property purely to rent it out. It promises no more property boom and bust. But, as it is not collected on any improvements made to land or to buildings on land, it does not discourage productive activity. Instead, it encourages people to bring idle land into use, to improve land they own and to be as productive as possible (when you have a pure LVT, earned income isn’t taxed at all). The end result is, in theory at least, good for society, good for the state, good for equality and good for growth.

Most people these days have never heard of the idea of an LVT, but the idea that it is a perfect tax has been around for centuries. Adam Smith noted its efficiency; David Ricardo was all for it; and it was hugely promoted by the US newspaper editor Henry George in the US in the late 19th century. George believed that LVT should be a single tax – its efficiency and productivity-enhancing effects would be such that all other taxes could and should be done away with.

It was a hobbyhorse of Winston Churchill’s. He was convinced that “land differs from all other sorts of property” and put the LVT case like this: “Unearned increments in land are not the only form of unearned or undeserved profit, but they are the principal form of unearned increment, and they are derived from processes which are not merely not beneficial, but positively detrimental to the general public.”

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Rent is 50% of a Nation's Income. Time to Collect it?
« Reply #136 on: November 29, 2013, 04:57:43 AM »
http://www.opednews.com/articles/Rent-is-50-of-a-Nation-s-by-Fred-Harrison-Money_National-Debt_Reform_Taxes-131124-761.html

Rent is 50% of a Nation's Income. Time to Collect it?

By Fred Harrison
OpEdNews.com
11/24/2013

To create a modern society based on freedom we need a financial system built on a clear understanding of the borders between

- what the individual citizen may retain as private property, and

- what must be recognized as the property of society.

The tragedy of the West is that a few people (the feudal aristocracy) privatized the rents that people generated. This created confusion between two pricing mechanisms:

1.    the prices charged in markets for consumer goods, and

2.    the prices charged to fund public services.

By understanding the differences between these two pricing mechanisms, it is possible to make the public and private sectors work together to create maximum welfare for both the individual and society.

But how much rent is produced in the economy? There is no answer to this question in the economic literature, so we have to go back to the beginning to work out the facts.

ATCOR: the Taxing Math

More than 300 years ago, English philosopher John Locke explained in Some Considerations of the Lowering of Interest and the Raising the Value of Money (1691) that it would be "in vain" for a country to lay taxes on anything other than land, for "there at least it will terminate".

- The merchant won't bear taxes, and

- the laborer cannot bear it. So they pass taxes on in higher prices.

But someone must pay: who? Locke was emphatic: taxes ultimately come out of a nation's rents.

- Taxes, when added to wages and profits, reduce what is left: the net income is then paid as rent.

- The reciprocal relationship between rent and the tax burden does not diminish rent; rather, a proportion of total rent is disguised.

Today, Locke's thesis is most thoroughly documented by Mason Gaffney, the American professor. He formulated an acronym for Locke's thesis: ATCOR. All taxes come out of rent.

To calculate a nation's total rents, we must first establish the amount people pay as "taxes".

- In the US in 2013, tax revenue was $5.3tn (GDP: $16.2tn). Using the ATCOR formula, we conclude that, if America was a tax-free zone, this revenue would revert back to rent.

About one-third of US income is converted from rent into "wages" and "profits" through anti-democratic political and bureaucratic channels.

But if revenue collected by government is ultimately out of rent, why argue for the need to collect that revenue directly? One answer: this would raise the productive capacity of the population. Why? Because taxes inflict "deadweight losses" on society.

If rent revenue is collected in a direct way, productivity is raised by a significant margin.

Rents in Private Pockets

The next question is about the proportion of a nation's revenue that is visible as rent. This is rent that is not collected by government. Economists have no idea of how much rent is circulating in the modern economy.

For current practical purposes, the prudent estimate is that rents in private pockets amount to about 20% of national income.

- In the UK, researchers found that rent was 22% of national income in 1985, rising to 29% in 1989. But 1989 was a peak year in the property cycle, just before the recession of 1992. Allowing for the distortions caused by land speculation, the "normal" year estimate for the UK would be for 1987: 21.8%.

- In Australia, researchers -- armed with one of the best official data sets in the world -- calculated that rent in private hands in 2012 was 26% of GDP. Rents in that year were inflated by abnormally high urban and commodity prices (one of the ripple effects of trade with China).

Adding up the "Rents"

If we take a random selection of 10 rich nations, ranging from Australia through the US to Sweden, Germany and Japan, the average tax-take as a percent of GDP is 37%. In ATCOR terms, most of this is rent in its disguised form (collected as if they were "wages" and "profits"). If we add to this the rent that is not collected by government, of around 20%, we find that rent exceeds 50% of national income. This first approximation of rent needs to be adjusted for several reasons.

1.    Taxes distort total income. They encourage the

- Under-use of urban land (which artificially raises rents). and they

- motivate behavior that damages the environment, as when polluters do not have to pay for dumping waste into the atmosphere (which artificially reduces rents).

2.    A small part of tax revenue may actually fall on wage earners, rather than being shifted (ultimately) onto rent. People with no bargaining power are particularly vulnerable.

Such considerations add to, and subtract from, rent. Further assessment is required, but the outcome would not significantly modify the conservative estimate that rent is about 50% of total income. This is more than sufficient to cover existing government financial commitments.

Nicolaus Tideman, a professor at Virginia Tech and State University, in the US, estimates that, five years into the financial reform, the average American family would be better off by $6,300.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline iamc2

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #137 on: November 29, 2013, 07:26:43 PM »
ALL LAND TAX IS A SCAM BY GOVENMENTS---PERIOD!

 The Land Belongs to GOD; and then to those who respect and use it well.

 The Government with their BS LAWS own NOTHING!

 And UNTIL People Understand this simple notion---he will pay illegal Taxes to Criminals!  >:(
"When the Truth was murdered:
Common Sense ran away..."

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Re: Land Value Taxation: Rebuttals to Common Objections
« Reply #138 on: November 29, 2013, 08:15:17 PM »
The Land Belongs to GOD;

To whom, therefore, does the community-generated value of the land "belong" -- and on what basis?

*  To all human beings equally, on the basis of the earth on which all must live yet which none produced being that to which all have an equal right of access?

*  To a mere subset of the human population, on the basis of the earth being the exclusive "property" of that subset?

     http://www.wealthandwant.com/HG/Moses.html


"When men have equal rights to a thing, as for instance, to the rooms and appurtenances of a club of which they are members, each has a right to use all or any part of the thing that no other one of them is using. It is only where there is use or some indication of use by one of the others that even politeness dictates such a phrase as 'Allow me!' or 'If you please!'

"But where men have joint rights to a thing, as for instance, to a sum of money held to their joint credit, then the consent of all the others is required for the use of the thing or of any part of it, by any one of them.

"Now, the rights of men to the use of land are not joint rights; they are equal rights.

"Were there only one man on earth, he would have a right to the use of the whole earth or any part of the earth.

"When there is more than one man on earth, the right to the use of land that any one of them would have, were he alone, is not abrogated: it is only limited. The right of each to the use of land is still a direct, original right, which he holds of himself, and not by the gift or consent of the others; but it has become limited by the similar rights of the others, and is therefore an equal right. His right to the use of the earth still continues; but it has become, by reason of this limitation, not an absolute right to use any part of the earth, but (1) an absolute right to use any part of the earth as to which his use does not conflict with the equal rights of others (i.e., which no one else wants to use at the same time), and (2) a coequal right to the use of any part of the earth which he and others may want to use at the same time.

"It is, thus, only where two or more men want to use the same land at the same time that equal rights to the use of land come in conflict, and the adjustment of society becomes necessary.

"If we keep this idea of equal rights in mind--the idea, namely, that the rights are the first thing, and the equality merely their limitation--we shall have no difficulty. It is through forgetting this that Mr. [Herbert] Spencer has been led into confusion."

-- Henry George, A Perplexed Philosopher, pp. 27-28


"Men must have rights before they can have equal rights. Each man has a right to use the world....The equality of this right is merely a limitation arising from the presence of others with like rights. Society, in other words, does not grant, and cannot equitably withhold from any individual, the right to the use of land. That right exists before society and independently of society, belonging at birth to each individual, and ceasing only with his death. Society itself has no original right to the use of land....The function of society with regard to the use of land only begins where individual rights clash, and is to secure equality between these clashing rights of individuals."

-- Henry George, A Perplexed Philosopher, p. 30


"The dry superficial area of the earth being the only medium through which external nature becomes accessible to man; being not merely his only foothold and resting-place, but also the means through which he obtains access to all the matter which he, through the exercise of his faculties, changes into objects fit to satisfy his desires and maintain his life,--it follows that freedom to use the earth is the indispensable condition for the exercise of man's faculties and the maintenance of his life. Hence the right to the use of the earth is a natural right, the denial of which involves the denial of the right to the exercise of any faculty, that is, the denial of the right to live.

"The right of any one to the exercise of his faculties being limited only by the equal right of every one else, the exercise of any faculty being dependent upon the use of the earth, it follows that the right of any one to use the earth is limited only by the equal right of every one else. The natural right to the use of the earth, therefore, is an equal right, inherent in all. If there were only one man upon this earth he would obviously be free to use the whole earth; the right of any second man to do the like must be equal to that of the former. Nor can further multiplication bring about any change in this relation. Of all the millions inhabiting the earth to-day, each is free to use the whole earth or any part of it, provided he infringes not the equal right of any other man. And conversely, it is equally true that no one of them may so use the earth as to prevent any other from similarly using it. For to do so implies a claim to greater opportunities for the exercise of his faculties than others can enjoy....

"No arrangements made, even with the consent of all living men, can deprive any member of any future generation of his or her equal rights to the use of the earth. Likewise no arrangements made by past generations, even if all their members had consented to them, can deprive any one now living of his equal right. For every such arrangement, if enforced, would offend against the law of equal freedom, would deprive some of their right to an equal opportunity for the exercise of their faculties and the maintenance of their lives."

-- Max Hirsch, Democracy versus Socialism, pp. 228-9


"Place one hundred men on an island from which there is no escape, and whether you make one of these men the absolute owner of the other ninety-nine, or the absolute owner of the soil of the island, will make no difference either to him or to them.

"In the one case, as the other, the one will be the absolute master of the ninety-nine--his power extending even to life and death, for simply to refuse them permission to live upon the island would be to force them into the sea.

"Upon a larger scale, and through more complex relations, the same cause must operate in the same way and to the same end--the ultimate result, the enslavement of laborers, becoming apparent just as the pressure increases which compels them to live on and from land which is treated as the exclusive property of others. Take a country in which the soil is divided among a number of proprietors, instead of being in the hands of one, and in which, as in modern production, the capitalist has been specialized from the laborer, and manufacturers and exchange, in all their many branches, have been separated from agriculture. Though less direct and obvious, the relations between the owners of the soil and the laborers will, with the increase of population and the improvement of the arts, tend to the same absolute master on the one hand and the same abject helplessness on the other, as in the case of the island we have supposed. Rent will advance, while wages will fall."

-- Henry George, Progress and Poverty, pp. 347-8


"We do not propose to assert equal rights to land by keeping land common, letting any one use any part of it at any time. We do not propose the task, impossible in the present day of society, of dividing land in equal shares; still less the yet more impossible task of keeping it so divided.

"We propose--leaving land in the private possession of individuals, with full liberty on their part to give, sell or bequeath it--simply to levy on it for public uses a tax that shall equal the annual value of the land itself, irrespective of the use made of it or the improvements on it....We would accompany this tax on land values with the repeal of all taxes now levied on the products and processes of industry--which taxes, since they take from the earnings of labor, we hold to be infringements of the right of property."

-- Henry George, The Condition of Labor, p. 8
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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How Wall Street Has Turned Housing Into a Dangerous Get-Rich-Quick Scheme—Again
« Reply #139 on: December 04, 2013, 05:51:50 PM »
Wall Street slumlords’ outrageous new scheme: How they could wreck the economy again

Remember mortgage-backed securities and the financial crisis they caused? This latest gambit will put you in shock

David Dayen
SALON
Nov. 6, 2013

http://www.globalresearch.ca/how-wall-street-has-turned-housing-into-a-dangerous-get-rich-quick-scheme-again/5360077

How Wall Street Has Turned Housing Into a Dangerous Get-Rich-Quick Scheme — Again

By Laura Gottesdiener
Global Research, December 02, 2013
TomDispatch 26 November 2013



You can hardly turn on the television or open a newspaper without hearing about the nation’s impressive, much celebrated housing recovery. Home prices are rising! New construction has started! The crisis is over! Yet beneath the fanfare, a whole new get-rich-quick scheme is brewing.

Over the last year and a half, Wall Street hedge funds and private equity firms have quietly amassed an unprecedented rental empire, snapping up Queen Anne Victorians in Atlanta, brick-faced bungalows in Chicago, Spanish revivals in Phoenix. In total, these deep-pocketed investors have bought more than 200,000 cheap, mostly foreclosed houses in cities hardest hit by the economic meltdown.

Wall Street’s foreclosure crisis, which began in late 2007 and forced more than 10 million people from their homes, has created a paradoxical problem. Millions of evicted Americans need a safe place to live, even as millions of vacant, bank-owned houses are blighting neighborhoods and spurring a rise in crime. Lucky for us, Wall Street has devised a solution: It’s going to rent these foreclosed houses back to us. In the process, it’s devised a new form of securitization that could cause this whole plan to blow up — again.

Since the buying frenzy began, no company has picked up more houses than the Blackstone Group, the largest private equity firm in the world. Using a subsidiary company, Invitation Homes, Blackstone has grabbed houses at foreclosure auctions, through local brokers, and in bulk purchases directly from banks the same way a regular person might stock up on toilet paper from Costco.

In one move, it bought 1,400 houses in Atlanta in a single day. As of November, Blackstone had spent $7.5 billion to buy 40,000 mostly foreclosed houses across the country. That’s a spending rate of $100 million a week since October 2012. It recently announced plans to take the business international, beginning in foreclosure-ravaged Spain.

Few outside the finance industry have heard of Blackstone. Yet today, it’s the largest owner of single-family rental homes in the nation — and of a whole lot of other things, too. It owns part or all of the Hilton Hotel chain, Southern Cross Healthcare, Houghton Mifflin publishing house, the Weather Channel, Sea World, the arts and crafts chain Michael’s, Orangina, and dozens of other companies.

Blackstone manages more than $210 billion in assets, according to its 2012 Securities and Exchange Commission annual filing. It’s also a public company with a list of institutional owners that reads like a who’s who of companies recently implicated in lawsuits over the mortgage crisis, including Morgan Stanley, Citigroup, Deutsche Bank, UBS, Bank of America, Goldman Sachs, and of course JP Morgan Chase, which just settled a lawsuit with the Department of Justice over its risky and often illegal mortgage practices, agreeing to pay an unprecedented $13 billion fine.

In other words, if Blackstone makes money by capitalizing on the housing crisis, all these other Wall Street banks — generally regarded as the main culprits in creating the conditions that led to the foreclosure crisis in the first place — make money too.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Harvard Study Finds: The Rent Is Too Damn High
« Reply #140 on: December 09, 2013, 04:45:23 PM »
http://www.businessweek.com/articles/2013-12-09/harvard-study-finds-the-rent-is-too-damn-high

Harvard Study Finds: The Rent Is Too Damn High

By Peter Coy
Businessweek
December 09, 2013

If you can’t afford to own, you can rent. But what if you can’t afford to rent, either? Millions of Americans are in precisely that situation, according to a study released today by the Joint Center for Housing Studies of Harvard University. The availability of apartments, especially cheaper ones, hasn’t nearly kept up with demand, and the problem has worsened since the 2007-09 recession, the study says.

“In 1960, about one in four renters paid more than 30 percent of income for housing. Today, one in two are cost burdened,” according to the study, America’s Rental Housing.

“Cost-burdened” means you’re paying more than 30 percent of income for housing and “severely cost-burdened” means you’re paying more than half. “By 2011, 28 percent of renters paid more than half their incomes for housing, bringing the number with severe cost burdens up by 2.5 million in just four years, to 11.3 million,” according to the Harvard study, which was conducted with partial funding from the MacArthur Foundation.

The boom in housing prices made ownership unaffordable for many families, and the subsequent bust forced others into foreclosure. You would think that all of those foreclosed homes would make great rental properties, and they have. “Remarkably,” though, the study says, “soaring demand was more than enough to absorb the 2.7 million single-family homes that flooded into the rental market after 2007.”

The result of the spike in rental demand is a seller’s market: “From a record high of 10.6 percent in 2009, the vacancy rate turned down in 2010 and has continued to slide, averaging 8.4 percent in the first three quarters of 2013.”

As usual, the pinch is hardest on the poor, those with incomes under $15,000 a year who pay at least half their incomes on rent. “With little else in their already tight budgets to cut, these renters spend about $130 less on food—a reduction of nearly 40 percent relative to those without burdens.”

[Continued...]

--------------------------------

Next headline...

     Harvard Study Finds: It's Too Damn COLD!

Oh gee, ya think?
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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Why Not Tax Monopoly Rents?
« Reply #141 on: December 13, 2013, 03:00:46 PM »
http://bollier.org/blog/why-not-tax-monopoly-rents

Why Not Tax Monopoly Rents?

David Bollier
bollier.org
12/13/2013

Some interesting material coming out of Prosper Australia is a Melbourne-based organization and its partners, Earthsharing Australia and the Land Values Research Group.  A new report entitled “Total Resource Rents:  Harnessing the Power of Monopoly” (pdf file) finds that nearly one-quarter of Australia’s GDP comes from unearned income, not the 2% that neoclassical economists claim.

This means that ten times greater revenue could be raised through taxing unearned income from monopolies than previously thought.  It also means that nearly half of Australia’s government revenues could be raised through channeling revenues from the real estate boom to more productive purposes.  In the process, income, company and sales taxes – along with 122 other current taxes – could be eliminated.

Report author Karl Fitzgerald, “the Renegade Economist,” describes the implications of the findings of the report:

“Unearned incomes equate to 23.6% of GDP and could be taxed without pushing up pricing structures. Most economists dismiss economic rents at just 2% of GDP. This report finds the free lunch driving the wealth gap is ten times greater than mainstream economists acknowledge.

“Prices could fall by some 20% by reducing the number of taxes from 126 to 24” stated Fitzgerald. “The compliance and deadweight losses are a huge cost that fall disproportionately on small business.”  This reform offers a more efficient and equitable economic system, valuing productive over speculative activities.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

EvadingGrid

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Re: Why Not Tax Monopoly Rents?
« Reply #142 on: December 13, 2013, 03:18:24 PM »
Why Not Tax Monopoly Rents?

Because the landlords would simply pass on the cost to the tenants. The landlords income would slightly increase, as they would inevitably pass on the cost and add a little bit to pocket themselves.

Would it not be better to place reasonable limits on how much property a person can own, as decided by the people ?

I've nothing against little people owning a second property and charging rent, but I have everything against someone owning the planet.
 

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Re: Why Not Tax Monopoly Rents?
« Reply #143 on: December 13, 2013, 03:28:29 PM »
Because the landlords would simply pass on the cost to the tenants.

Sorry to have to respectfully disagree, my friend, but that simply isn't true...

"A tax on rent...would fall wholly on landlords, and could not be shifted to any class of consumers."



"A tax on rent falls wholly on the landlord. There are no means by which he can shift the burden upon any one else."



“The striking result is that a tax on rent will lead to no distortions or economic inefficiencies. Why not? Because a tax on pure economic rent does not change anyone's behavior. Demanders are unaffected because their price is unchanged. The behavior of suppliers is unaffected because the supply of land is fixed and cannot react. Hence, the economy operates after the tax exactly as it did before the tax--with no distortions or inefficiencies arising as a result of the land tax."

-- Paul A. Samuelson, Economics, 16th ed., p. 250


"At the opposite extreme of the claim that land value taxation is wrong because landholders would be the only ones paying taxes is the claim that landholders would be paying no taxes at all. It is claimed that they would merely raise their rents in proportion to the increase in taxes falling on their lands. But this is one thing all reputable economists agree can not be done. If site A (land only) in the heart of a city is worth $1,000 per month to whoever uses it, while site B (land only) on the outskirts of the city is worth only $100.00 per month, then site A is worth only $900.00 more per month than is site B. A change in the amount of taxes falling on these two landholders cannot affect the relative value of these sites. Suppose, for example, that an attempt were made to get $2,000 and $200.00 per month respectively for these two sites just because each landholder were required to pay taxes of $1,000 and $100.00 respectively to the city. Obviously, the tenants in site A would move to lower cost land. Site A is not worth $1,800 more per month than site B. If it were, the landholder would be getting it in today's market. Although a tax on land values affects the price of land, it cannot affect its rental value. There is no disagreement among professional economists on this point."

-- Robert De Fremery, Rights vs. Privileges, pp. 38-39


http://www.wealthandwant.com/HG/why_the_landowner_cannot_shift.html

Why The Landowner Cannot Shift The Tax on Land Values

By Henry George
An Editorial reprinted from The Standard, 1887

A very common objection to the proposition to concentrate all taxes on Land Values is that the landowner would add the increased tax on the value of his land to the rent that must be paid by his tenants. It is this notion that increased Taxation of Land Values would fall upon the users, not upon the owners of land, that more perhaps than anything else prevents men from seeing the far-reaching and beneficent effects of doing away with the taxes that now fall upon labor or the products of labor, and taking for public use those values that attach to land by reason of the growth and progress of society.

That taxes levied upon Land Values, or, to use the politico-economic term, taxes levied upon rent, do not fall upon the user of land, and cannot be transferred by the landlord to the tenant is conceded by all economists of reputation. However much they may dispute as to other things, there is no dispute upon this point. Whatever flimsy reasons any of them may have deemed it expedient to give why the tax on rent should not be more resorted to, they all admit that the taxation of rent merely diminishes the profits of the landowner, cannot be shifted on the user of land, cannot add to prices, nor check production.

Not to multiply authorities, it will be sufficient to quote John Stuart Mill. He says (Section 2, Chapter 3, Book 5, “Principles of Political Economy”) “A tax on rent falls wholly on the landlord. There are no means by which he can shift the burden upon anyone else. It does not affect the value or price of agricultural produce, for this is determined by the cost of production in the most unfavorable circumstances, and in those circumstances, as we have so often demonstrated, no rent is paid. A tax on rent, therefore, has no effect other than its obvious one. It merely takes so much from the landlord and transfers it to the State.”

The reason of this will be clear to everyone who has grasped the accepted theory of rent — that theory to which the name of Ricardo has been given, and which, as John Stuart Mill says, has but to be understood to be proved. And it will be clear to everyone who will consider a moment, even if he has never before thought of the cause and nature of rent. The rent of land represents a return to ownership over and above the return which is sufficient to induce use — it is a premium paid for permission to use. To take, in taxation, a part or the whole of this premium in no way affects the incentive to use or the return to use; in no way diminishes the amount of land there is to use, or makes it more difficult to obtain it for use. Thus there is no way in which a tax upon rent or Land Values can be transferred to the user. Whatever the State may demand of this premium simply diminishes the net amount which ownership can get for the use of land, or the price it can demand as purchase money, which is, of course, rent or the expectation of rent, capitalized.

Here, for instance, is a piece of land that has a value — let it be where it may. Its rent, or value, is the highest price that anyone will give for it — it is a bonus which the man who wants to use the land must pay to the man who owns the land for permission to use it. Nor, if a tax be levied on that rent or value, this in no wise adds to the willingness of anyone to pay more for the land than before; nor does it in any way add to the ability of the owner to demand more. To suppose, in fact, that such a tax could be thrown by landowners upon tenants is to suppose that the owners of land do not now get for their land all it will bring; is to suppose that, whenever they want to, they can put up prices as they please.

This is, of course, absurd. There could be no limit whatever to prices did the fixing of them rest entirely with the seller. To the price which will be given and received for anything, two wants or wills must concur — the want or the will of the buyer, and the want or will of the seller. The one wants to give as little as he can, the other to get as much as he can, and the point at which the exchange will take place is the point where these two desires come to a balance or effect a compromise. In other words, price is determined by the equation of supply and demand. And, evidently, taxation cannot affect price unless it affects the relative power of one or other of the elements of this equation. The mere wish of the seller to get more, the mere wish of the buyer to pay less, can neither raise nor lower prices. Nothing will raise prices unless it either decreases supply or increases demand. Nothing will lower prices unless it either increases supply or decreases demand. Now, the Taxation of Land Values, which is simply the taking by the State of a part of the premium which the landowner can get for the permission to use land, neither increases the demand for land nor decreases the supply of land, and therefore cannot increase the price that the landowner can get from the user. Thus it is impossible for landowners to throw such taxation on land users by raising rents. Other things being unaltered, rents would be no higher than before, while the selling price of land, which is determined by net rents, would be much diminished. Whoever purchased land outright would have to pay less to the seller, because he would thereafter be called on to pay more to the State.

But while the Taxation of Land Values cannot raise rents, it would, especially in a country like this, where there is so much valuable land unused, tend strongly to lower them. In all our cities, and through all the country, there is much land which is not used, or not put to its best use, because it is held at high prices by men who do not want to, or who cannot, use it themselves, but who are holding it in expectation of profiting by the increased value which the growth of population will give to it in the future. Now the effect of the Taxation of Land Values would be to compel these men to seek tenants or purchasers. Land upon which there is no taxation even a poor man can easily hold for higher prices, for land eats nothing. But put heavy taxation upon it, and even a rich man will be driven to seek purchasers or tenants, and to get them he will have to put down the price he asks, instead of putting it up; for it is by asking less, not by asking more, that those who have anything they are forced to dispose of must seek customers. Rather than continue to pay heavy taxes upon land yielding him nothing, and from the future increase in value of which he could have no expectation of profit, since increase in value would mean increased taxes, he would be glad to give it away or let it revert to the State. Thus the dogs in the manger, who all over the country are withholding land that they cannot use themselves from men who would be glad to use it, would be forced to let go their grasp. To tax Land Values up to anything like their full amount would be to utterly destroy speculative values, and to diminish all rents into which this speculative element enters. And how groundless it is to think that landlords who have tenants could shift a tax on Land Values upon their tenants can be readily seen from the effect upon landlords who have no tenants. It is when tenants seek for land, not when landlords seek for tenants, that rent goes up.

To put the matter in a form in which it can be easily understood, let us take two cases. The one, a country where the available land is all in use, and the competition of tenants has carried rents to a point at which the tenant pays the landlord all he can possibly earn save just enough to barely live. The other, a country where all the available land is not in use and the rent that the landlord can get from the tenant is limited by the terms on which the tenant can get access to unused land. How, in either case, if the tax were imposed upon Land Values (or rent), could the landlord compel the tenant to pay it?

It may be well to call attention to the fact that a tax on Land Values is not a tax on land. They are very different things, and the difference should be noted, because a confusion of thought as to them may lead to the assumption that a tax on Land Values would fall on the user. Barring such effect as it might have on speculation, a tax on land — that is to say, a tax of so much per acre or so much per foot on all land — would fall on the user. For such a tax, falling equally on all land — on the poorest and least advantageously situated as fully as on the richest and best situated land — would become a condition imposed on the use of any land, from which there could be no escape, and thus the owners of rentable land could add it to their rent. Its operation would be analogous to that of a tax on a producible commodity, and it would in effect reduce the supply of land sufficient to pay the tax. But a tax on economic rent or Land Values would not fall on all land. It would fall only on valuable land, and on that in proportion to its value. It would not have to be paid upon the poorest land in use (which always determines rent), and so would not become a condition of use, or restrict the amount of land that could be profitably used. Thus the landowners on whom it fell could not shift it on the users of land. This distinction, as to nature and effects, between a tax on land and a tax on Land Values, it is necessary to bear in mind.

It is also necessary to bear in mind that the value of land is something totally distinct from the value of improvements. It is a value which arises not from the exertion of any particular individual, but from the growth and progress of the community. A tax on Land Values, therefore, never lessens the reward of exertion or accumulation. It simply takes for the whole community that value which the whole community creates.

While it is not true that a tax on Land Values or rent falls on the user, and thus distributes itself through increased prices, it is true that the greater number of taxes by which our public revenues are raised do. Thus, speaking generally, taxes upon capital fall, not upon the owners of capital, but upon the users of capital, and are by them transferred to the consumers of whatever the capital is used to produce; taxes upon buildings or building materials must ultimately be paid in increased building rents or prices by the occupiers of buildings; imposts upon production or duties upon imports must finally fall upon the consumer of the commodities. This fact is far from being popularly appreciated, for, if it were, the masses would never consent to the system by which the greater part of our revenues is raised. But, nevertheless, it is the vague apprehension of this that leads by confusion of ideas to the notion that a tax on Land Values must add to rents. This notion will disappear if it be considered how it is that any tax gives to the person first called on to pay it the power of shifting it upon others by an increase of price.

A tax on matches, for instance, will, as we know by experience, enable the manufacturer or dealer in matches to get a higher price. How? Evidently by adding to the cost of producing matches for sale, thus checking the supply of matches that can be offered for sale until the price rises sufficiently to compensate for the tax. It is this knowledge that the tax will add to the cost of production, and thus, below a certain price, check competition in supply, that enables the dealer to mark up the price of his stock of matches as soon as the tax is imposed, or compels him to mark it down as soon as the tax is remitted.

But a tax on Land Values does not add to the cost of producing land. Land is not a thing of human production. Man does not produce land! He finds it already in existence when he comes into the world. Its price, therefore, is not fixed by the cost of production, but is always the highest price that anyone can give for the privilege of using a particular piece. Land, unlike things that must be constantly produced by labor, has no normal value based on the cost of production, but ranges in value from nothing at all to the enormous values that attach to choice sites in great cities, or to mineral deposits of superior richness, when the growth of population causes a demand for their use.

Hence a tax on Land Values, instead of enabling the holder of land to charge that much more for his land, gives him no power to charge an additional penny. On the contrary, by making it more costly to hold land idle, it tends to increase the amount of land which owners must strive to secure tenants or purchasers for. Thus the effect of a tax on Land Values is not to increase the rent that the tenant must pay the owner for the use of the land, but rather to reduce it. And since the tax must be paid out of what the land will yield the owner, its effect would be to reduce the price for which the land could be sold outright.

Here, let us say, is a lot on the principal select street of a city having an annual or rental value of $10,000. Such a lot would now command a selling price of some $250,000. An increased tax upon Land Values would not reduce its rental value, except as it might have an effect in forcing into use unoccupied land at a greater distance from the center of the city. But as less of this rental value could be retained by the owner, the selling price would be diminished. And if a tax on Land Values could be imposed with such theoretical perfection that the whole rental value would be taken by the community, the owner would lose both his income from its present value and any expectation of profit from its future increase in value. While it would be still worth as much as before to the user, it would be worth nothing at all to the mere owner. Instead of having a selling value of $250,000, it would not sell for anything, since what the user paid for the privilege of using it would go in full to the community. Under a tax of this kind, even though it could not be imposed with theoretical nicety, the mere owner of land would disappear. No one would care to own land unless he wanted to improve or use it.

The general principle which determines the incidence of taxation is this: A tax upon anything or upon the methods or means of production of anything, the price of which is kept down by the ability to produce increased supplies, will, by increasing the cost of production, check supply, and thus add to the price of that thing, and ultimately fall on the consumer. But a tax upon anything of which the supply is fixed or monopolized, and of which the cost of production is not therefore a determining element, since it has no effect in checking supply, does not increase prices, and falls entirely on the owner.

In view of the efforts that are made to befog the popular mind on this point, I have deemed it worth while to show why taxes on Land Values cannot be shifted by landlords upon their tenants. But the fact that such a tax cannot be so shifted is realized well enough by landowners. Else why the opposition to the Single Tax, and why the cry of “confiscation?” Our national experience, like the experience of every other country, proves that those who are called on to pay a tax that can be shifted on others, seldom or ever oppose it, but frequently favor it, and that when once imposed, they generally resist its abolition. But did anyone ever hear of landlords welcoming a tax on Land Values, or opposing the abolition of such a tax?

-----------------------------------

More on this at...

     http://www.wealthandwant.com/themes/Not_Passed_On.html

     http://kaalvtn.blogspot.co.uk/2013/01/g-lvt-would-benefit-rich-and-hurt-poor.html#1
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Homelessness in Silicon Valley
« Reply #144 on: December 20, 2013, 10:21:46 AM »
The difference between land and capital is huge, and explains why the cost of silicon chips goes down as demand goes up, while the cost of Silicon Valley goes up as demand goes up.

The anti-Georgist tax policy known as Proposition 13 continues to create the deepest levels of poverty precisely where wealth most abounds, proving once again that Henry George was right and that both his left-wing and right-wing critics were (and are) wrong...

http://www.alternet.org/hard-times-usa/jungle-thousands-homeless-people-live-shantytowns-epicenter-high-tech-super-rich

The Jungle: Thousands of Homeless People Live in Shantytowns at the Epicenter of High-Tech, Super-Rich Silicon Valley

Residents of Silicon Valley’s largest homeless encampment illustrate the widening divide between the nation’s haves and have-nots.

By Evelyn Nieves
AlterNet
December 15, 2013


Photo Credit: Evelyn Nieves

By mid-morning on Thursday, the sun was shining hard enough to dry wet blankets and the residents of the Jungle began surfacing, letting each other know they were still alive.

Six straight nights of freezing temperatures had tested their tenacity, not to mention their tarps and tents. It was so cold that the raccoons that raid the trash bins every night disappeared, a first. Ditto the crows, squirrels and feral cats. Life in the Jungle, 75 wooded acres off Interstate 101 in San Jose that comprises Silicon Valley’s largest homeless encampment, came to a standstill.

With the hard ground thawing, the Jungle looked as if spring had sprung. People strolled the dirt paths, rode their bikes and walked their dogs. Everyone in the Jungle—200 men and women, give or take—looked ready to celebrate surviving the earliest, coldest cold snap on record.

“We were lucky,” said Troy Feid, a former carpenter, squinting into the bright sky. “Not everyone was.”

Four homeless men in Silicon Valley did not make it through the season’s first bout of sub-freezing temperatures. Over the last two weeks, three of them froze to death on the streets of San Jose, not far from the Jungle.

That people live and die on the streets of Silicon Valley is no news to the poor, of course. With more than 6,500 tech companies in all, Santa Clara County is home to the biggest stars in the tech universe, including Google, Facebook, Yahoo, eBay and Apple. But the land of high-tech milk and honey is also a prime example of the widening divide between the nation’s haves and have-nots.

For all its stock-option millionaires, the San Jose/Santa Clara County region (pop. 1.8 million) also has the nation’s fifth largest population of homeless (after New York, Los Angeles, Seattle and San Diego), according to the U.S. Department of Housing and Urban Development. The main culprits? Budget cuts that have frayed the safety net and sky-high housing costs. These days, a three-bedroom, one-bath starter home in San Jose, the county seat and one of its most affordable cities, costs a cool million. Rents for a two-bedroom apartment go from $2,000 to $5,000 a month, and those on the low-end are scarce.

While homelessness remains off the radar of the Silicon Valley titans, it keeps getting worse, up 20 percent in two years. More than 7,600 people sleep on the streets every night. Dozens of encampments dot the landscape, and thousands of people live in temporary quarters—shelters, motels, friends’ homes. Several private and public organizations in Santa Clara County are dedicated to helping the unhoused receive medical care, supplies and assistance in finding shelter. But funds and available units to move homeless people into permanent housing are meager.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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What's All the Land in America Worth?
« Reply #145 on: December 21, 2013, 07:05:02 AM »
http://www.slate.com/blogs/moneybox/2013/12/20/value_of_all_land_in_the_united_states.html

What's All the Land in America Worth?

By Matthew Yglesias
Slate
12/20/2013



After yesterday's post on the aggregate value of all the housing in America, a couple of correspondents noted to me that for recent decades you can actually compute the value of all the land in America from the Federal Reserve's Flow of Funds report (PDF). The short answer is that all the privately owned land in America is worth about $14.488 trillion—which is a lot.

Here's how the math works. Table B.100 "Balance Sheet of Households and Nonprofit Organizations" has a line for real estate in its nonfinancial assets section. It tells us that households and nonprofits own $21.61 trillion in real estate. Then at the bottom on line 45 it tells us that the replacement cost of all the structures owned by households and nonprofits is $13.8 trillion. So all you need to do is subtract the replacement cost of the structures from the total value of the real estate to reach the conclusion that a little bit over one-third of the total real-estate value—about $7.812 trillion—is land.

Then you repeat the procedure for B.102 "Balance Sheet of Nonfinancial Corporate Business." Here we learn that corporate America owns $9.867 trillion of real estate and that the replacement value of the structures on it is about $8.109 trillion. Subtract and we conclude that there's $1.758 trillion* worth of land in the corporate sector.

Last we turn to noncorporate business, which owns $9.704 trillion in real estate and has a replacement cost of structures of $4.786 trillion, giving us $4.918 trillion in land.

Add it all up and you get $14.488 trillion in land value.

[Continued...]


http://www.earthrights.net/docs/fifteen.html

Sounding the Revenue Potential of Land: Fifteen Lost Elements

by Mason Gaffney

Text of an address delivered at the annual meeting of the Council of Georgist Organizations, held in Albuquerque, July 2004

ABRIDGED FOR USE IN GROUNDSWELL, October 2004


You see, my dear Watson, but you do not observe.” - Holmes

The revenue potential of land is greater than anyone thinks. This is a progress report on a study that finds, bares, and to some extent measures elements of enhanced revenue potential by using truer and more comprehensive measures of rent and land values. It should go without saying, but often does not, that the purpose of raising more land revenues is not to fatten vexatious bureaucrats. It is to replace vexatious taxes, to provide and maintain and operate needed public infrastructure and services (including a reasonable national defense), to pay off old public debts and avoid new ones, and to fund social dividends (including existing social dividends like Social Security and public schools).

There are at least fifteen elements of land’s taxable capacity that previous researchers have either slighted, or overlooked entirely.

*  Items 1-3 below correct for the downward bias in standard data.
*  Items 4-11 broaden the concepts of land and its rent.
*  Items 12-15 show how exempting production, trade and capital uncaps potential tax rates.

[Continued...]

--------------------------------

^^  Still think wages, sales, houses and capital goods can't all be exempt from taxation without having to eliminate or even cut essential government services in the process?

Note: "Essential government services" obviously do NOT include (a) imperialist wars of aggression, (b) domestic police state measures, (c) corporate welfare subsidies, (d) banker bailouts, nor (e) interest on the national debt (which can and must be eliminated via the implementation of a debt-free money system) -- the combined annual taxpayer cost of which easily exceeds $1 trillion.

You've been lied to, folks. The Austrians lied to you. The Keynesians lied to you. The Marxists lied to you.

We can reconcile the alleged and falsely perceived conflict between economic freedom, on the one hand, and social justice, on the other, simply by implementing both...

*  The NEED Act

     http://thomas.loc.gov/cgi-bin/query/z?c112:H.R.2990.IH:
     http://www.monetary.org/wp-content/uploads/2013/01/HR-2990.pdf
     http://www.huffingtonpost.com/stephen-zarlenga/sequesters-shutdowns-and-_b_4086071.html

*  The Single Tax

     http://schalkenbach.org/rsf-2/henry-george/the-single-tax/
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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Secret of the Tax-free Life
« Reply #146 on: December 25, 2013, 12:25:01 AM »
http://www.youtube.com/watch?v=vcK9PYGHz0I (Secret of the Tax-free Life)

"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline africknamerican

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End the 1 percent’s free ride: Taxing land would solve America’s biggest problems


sad news. Our friend Jesse has just published a piece in Rolling Stone advocating pretty much full communism.

Either he just doesn't get it -- ie, his research of George and  LVT did not teach him that land is vastly different from the other two factors -- or, he gets it all too well and, as a "communications gun for hire" (his Twitter self-description), he's been hired by some forces who really want to muddy the waters on this issue. It sure got Rolling Stone a lot of clicks, no doubt...

It's a pretty weaselly thing to do, but also (if we work it hard enough), another chance to turn evil into good and get the truth out.

Offline Geolibertarian

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sad news. Our friend Jesse has just published a piece in Rolling Stone advocating pretty much full communism.

Either he just doesn't get it -- ie, his research of George and  LVT did not teach him that land is vastly different from the other two factors -- or, he gets it all too well and, as a "communications gun for hire" (his Twitter self-description), he's been hired by some forces who really want to muddy the waters on this issue. It sure got Rolling Stone a lot of clicks, no doubt...

It's a pretty weaselly thing to do, but also (if we work it hard enough), another chance to turn evil into good and get the truth out.

Agreed. Henry George didn't just say to tax land values, but to literally "abolish all taxation save that upon land values" (emphasis added).

Big difference.

That's why I'm a fan of such slogans as "abolish taxes and share the rent," and "no taxes and a pension for everybody."

Generally speaking, socialists and quasi-socialists are always bending over backwards to de-emphasize the "abolition" aspect of the Single Tax. (Edit: although, in fairness to Jesse Myerson, he did say, "No sales tax. No income tax. No payroll tax to fill a Social Security trust fund. No corporate income tax...". Perhaps his attack of philosophical clarity was only temporary.) They were doing so a century ago, and are still doing it now. An obvious case in point is their love affair with the ridiculous "carbon tax" scheme.

When they speak, they speak for themselves, not for me.
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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Economic Growth and Income Distribution
« Reply #149 on: January 13, 2014, 11:37:00 PM »
http://www.progress.org/views/editorials/economic-growth-income-distribution/

Economic Growth and Income Distribution

Fred Foldvary
The Progress Report
January 12, 2014

One of the topics that has not received enough attention in economics is the effect of economic growth on the distribution of income. So if you want to understand it, you should get a piece of paper. I’ll wait until you have it …

Now on the lower left side, draw a rectangle with a height longer than the width. The top half of the paper should still be blank. We will use an agricultural model with one product, corn. At first, the only factors are land and labor. Now draw small circles of equal size in the rectangle. These are farms of equal size. The yield is ten bushels of corn per farm per period of production. As long as there is free land available, land rent is zero, and the entire yield of ten goes to wages.

Now draw another rectangle to the right of the first one, three-fifths as high. Label this “six,” because the output in that land is six bushels of corn. All the farm workers are equally skilled and work the same number of hours, so the lower yield is due to its being less productive land. With rent at zero because there is free land, the wage is six. The wage in the ten-bushel land has now fallen to six, because workers are mobile and equally skilled. The extra four bushels in the ten-bushel farms are now land rent.

For rent and wages, it does not matter whether the owner is also the worker, or whether he hires labor at six bushels, or whether he rents out the land to a tenant at four bushels. The economic rent is the difference in the productivity of the two lands, regardless of who are the owners, tenants, and workers. If the landlord happens to charge only three bushels from a tenant, the economic rent is still four: three go to the landlord, while one bushel is the yield as rent kept by the tenant.

In classical economics, the least productive land in use is called the “margin of production.” There is a “law of wages,” which states that the wage level for the economy is the wage at the margin of production. There is a “law of rent” which states that the rent of a plot of land is its output minus the normal costs of labor and capital goods, such as, in our simple model, the difference between the output of the lands yielding ten and six.

Now add a third rectangle to the right of the six-bushel land, and label this “four,” because this is the new margin of production yielding four bushels. Wages there are four, making the wage also four at the lands yielding ten and six. Now rent in the ten-bushel land has risen from four to six, and rent at the six-bushel land has risen from zero to two. You can see that as the margin of production moves to less productive land, wages fall and rent rises.

Now let us introduce a plow, which represents both more capital goods and better technology. The plow costs two bushels and completely depreciates each period, requiring a new plow for the next period. The plow doubles production at each plot of land. So on the rightmost rectangle, draw another rectangle just above the first one, attached to it, with an equal size, representing the doubling of output.

Is it worth buying the plow? Yes! The farms at the margin, having yielded four, now yield eight. After paying for the capital good, the plow, the output is six, which all goes to wages. Wages there have risen by 50 percent. By the law of wages, wages in the other farms have risen to six.

With the plow, the farms that yielded six now yield twelve. Draw a rectangle above the middle one, with equal size. Now the distribution of the twelve-bushel output is two to capital goods, six to wages, and the remainder, four bushels, to rent. Rent there doubled from two to four bushels.

Now do the same for what was the ten-bushel land, which now yields twenty. The distribution is two to capital goods, six to wages, and the remainder, twelve bushels, to rent. Rent there also doubled, from six to twelve bushels. (A similar graph of the factors).

Now we can see the effect of the economic growth caused by more and better capital goods. Wages have risen by fifty percent, while rent doubled. We can calculate this in bushels. Suppose there were ten farms in each grade of land. Write this down: before the plow, for the three lands, output was 100 + 60 + 40 = 200. Wages were 40 times 3 = 120. Rent was 60 + 20 = 80. So wages were 60 percent and rent was 40 percent of income.

With the plow, output doubles to 200 + 120 + 80 = 400. Are you writing this down? Wages are now 60 times 3 = 180. Capital yields are 2 bushels per plow times 30 farms = 60 bushels. Land rent is 120 + 40 = 160. Wages are now 180/400 = 45 percent of income. Capital yields = 60/400 = 15 percent of income. Rent = 40 percent of income. Wages rose by 60 bushels, while rent has risen by 80 bushels.

The portion of income going to wages has fallen from 60 to 45 percent, but the portion of rent stayed the same, 40 percent. The doubling of output doubled the rent, but because the plow has a cost, wages could not double, but they did rise by 50 percent. Labor benefits from the greater productivity, but landowners benefit more. If new technology and capital goods were to similarly double production again, the distribution of income would keep the same proportions.

If the ownership of the land value is concentrated, then much of the gains from economic expansion is distributed to a few landowners. The greater rent going to a few owners explains much of the inequality of income today throughout the world. These landowners do nothing to generate the growth. Usually, better capital goods also requires better human capital, greater skills. So the economic growth and development is caused by entrepreneurship and investment in capital goods and human capital, and the yields properly go to a return on the capital goods, the capital yield, and to greater wages, including the gains to the entrepreneurs. But the greater rent is a surplus windfall to the owners of land that obtain the rent just by holding title.

If we believe in human equality, the land rent should be distributed to all the people equally. Then all the people would equally benefit from the greater productivity. The effect of greater productivity on the input-factor distribution of income has been neglected, so this model should be taught in all courses on the principles of economics.
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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These 10 People Collectively Own 33 Million Acres, Or 1.5% Of All US Land
« Reply #150 on: January 15, 2014, 10:24:22 AM »
Unsurprisingly, what Zero Hedge (ZH) doesn't tell you in the following article is that, since land is fixed in both supply and location, absentee landlordship of this magnitude is the inevitable consequence of not using publicly-generated land values as the primary if not sole source of public revenue. And the reason ZH doesn't tell you this is that it knows all too well that, if the Austrian School had its way, land values would be even more privatized than they already are. The end result? More rent-seeking, not less.

http://www.prisonplanet.com/these-10-people-collectively-own-33-million-acres-or-1-5-of-all-us-land.html

These 10 People Collectively Own 33 Million Acres, Or 1.5% Of All US Land

Zero Hedge
January 15, 2014

It is a well-known fact that when it comes to ownership of rental properties in the US, Wall Street, and particularly Blackstone, has become the single largest landlord in the country. But what about undeveloped land? As summarized by Vizual-statistix, according to The Land Report published by Fay Ranches, the top 100 owners of US land collectively have 33 million acres in their private holdings. This equates to about 1.5% of all USA land – that may seem like a small percentage, but it’s actually a massive area.  The chart below lays out the top 10 largest private landowners with the areas of Puerto Rico, Delaware, Rhode Island, and Washington, D.C. included for scale. As can be seen, all of the top 10 own a piece of the USA that is bigger than Rhode Island, and five have a piece that is at least as big as Delaware. John Malone, who is the largest land owner in the country with 2.2 million acres, owns private property the size of Puerto Rico.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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The left and an anti-rentier agenda
« Reply #151 on: February 02, 2014, 04:56:35 PM »
http://henrygeorgedevon.wordpress.com/2014/02/02/the-left-and-an-anti-rentier-agenda/

The left and an anti-rentier agenda

The Henry George Society of Devon
February 02, 2014

In a series of articles appearing on Salon last year Michael Lind argued that left and right alike are confused by a failure to distinguish productive businesses that sell innovative goods and services from “rentier” interests — landlords, lenders, copyright holders and others — which use their natural or artificial monopoly power to extract excessive tolls, fees and other recurrent payments from the rest of society, including productive businesses. Lind made the case that the fees or rents extracted by these interests constitute a kind of “private taxation” and that this is the greatest threat facing the productive economy.

This line of thinking is essentially a Georgist one and it doesn’t sit easily on the tired old left-right spectrum that dominates mainstream political discourse today. Many on those who identify with the left, worried that growing wealth inequality is leading to complete domination of society by big moneyed interests, denounce “capitalism” and reach for socialist answers. Take for example the following policy statement from the newly formed LeftUnity Party in the UK:

    “We are socialist because our aim is to end capitalism. We will pursue a society where the meeting of human needs is paramount, not one which is driven by the quest for private profit and the enrichment of a few. The natural wealth, and the means of production, distribution and exchange will be owned in common and democratically run by and for the people as a whole, rather than being owned and controlled by a small minority to enrich themselves.”

This approach is born out of a flawed understanding of fundamental economic principles, namely the conflation of land with capital and the mistaken belief that privilege stems from ownership of the latter rather than the former.

There is nothing wrong with wealth per se – after all we all want it! A top footballer or movie star who earns astronomical amounts by virtue of their unique talent isn’t preventing anyone else from prospering, so good luck to them I say! Similarly, creative go-getting entrepreneurs who make their money satisfying others needs in the market place should be free to enjoy the wealth they have created. Stealing their income and redistributing it to others smacks of envy.

The problem with wealth arises when it is possible to use it to buy monopoly privilege including control of natural resources, thus depriving others of access to the opportunities they need to get ahead unless they meet the payment terms of the owner. So in the aforementioned examples, the movie star and the entrepreneur who go on to invest their wealth in speculative real estate or shares in an exploitative oil company have crossed the line from wealth creator to parasite. In essence the Georgist solution is to cut off this possibility in a very simple and efficient way, leaving the economy to function as a true free market that benefits all.

I believe the best way to undermine the powerful elite vested interests that exploit the wealth of society and the planet is to drive a wedge between them and genuine wealth creators i.e. the industrious hardworking people that actually provide the goods and services in the economy. This includes lowly wage workers and high flying individuals who should be allies in this struggle. It won’t be done with socialist rhetoric which unhelpfully perpetuates the sterile socialist-capitalist dichotomy and precludes the possibility of a broader anti-rentier agenda from taking shape thus playing into the hands of establishment interests that want to maintain the status quo. Clearly much needs to be done to reshape the political debate in order to form a genuine coalition for change that works for everyone. Georgist education of economic principles has an absolutely vital role to play in this process of realignment.
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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Housing crisis taking toll with no-fault evictions
« Reply #152 on: February 03, 2014, 09:56:29 AM »
Of the millions of "little old ladies" who -- due to the land speculation-driven high cost of housing -- are forced to "rent" instead of "own," how many have fallen prey to this worsening trend?

--------------------------------

http://www.sfgate.com/bayarea/article/Housing-crisis-taking-toll-with-no-fault-evictions-4988391.php

Housing crisis taking toll with no-fault evictions

Marisa Lagos and John Coté
SFGate
November 16, 2013

Jennifer Mieuli Jameson isn't the kind of person you would expect to be losing her home.

The middle-class, 48-year-old Sunset District resident has manicured nails, well-coiffed hair and neat clothing. A paralegal who was laid off during the economic downturn, she now runs a nonprofit dog rescue organization. Her husband works in information technology for a law firm. She is not elderly or disabled. She has not lived in her rental for decades.

And when she and her husband are forced out of their Sunset District home because their rent is doubling, they will not be counted among the city's evictions.

[Continued...]

--------------------------------

In light of what was already being reported on (see the link below) several years before the 2008 derivatives-caused financial crisis, is it safe to assume that more than a few have?

     http://www.elderlawanswers.com/elderly-renters-are-facing-an-epidemic-of-evictions-3197

And have you noticed that those who profess so much concern for the plight of "little old ladies" either start hemming and hawing or become mysteriously silent whenever someone brings up the issue of tenants being evicted from their homes at gunpoint as a consequence of the poverty-in-the-midst-of-plenty-creating rent-wage gap?

Why the apparent double standard?

Could it have something to do with intuitive awareness of the fact that this issue can't be candidly addressed without running the risk of drawing attention to the anti-Georgist tax policy that gave rise to said "gap" in the first place -- and of thereby validating the Single Tax remedy?

Such questions cannot be answered by continually begging them.

"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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Why is the rent so high?
« Reply #153 on: February 21, 2014, 09:28:38 AM »
An excellent introduction to the Law of Rent...

     http://www.youtube.com/watch?v=7HZANYxnkWk (Why is the rent so high?)
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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Georgism in 300 words
« Reply #154 on: February 27, 2014, 04:34:27 AM »
http://mickanomics.blogspot.com/2014/02/georgism-in-300-words.html

Georgism in 300 words

MICKANOMICS
February 26, 2014

Imagine that in the distant past, a ship ran into rocks off a desert island and started sinking.  Everyone jumped overboard and started swimming towards the nearest beach. Imagine a guy armed with a gun got to the island first, and then upon everyone else's arrival, the guy said, “I got here first, so this island is mine. You can't live here unless you pay me rent for using my land”. The swimmers have no choice and have to give the “landowner” part of their income forever more.  This situation obviously stinks. If you were one of the people having to pay rent you would be angry as hell, you’d protest at every opportunity. Who could possibly defend such system?

Now imagine that at some later time, a rich islander purchased the island from the gunman for a large sum of money. The rich man announced to the rest of the islanders, “That nasty gunman was evil and grabbed the island unjustly. He had no right to claim rent from you all. But I purchased the land with my own money and without violence. Therefore this island is rightfully mine, and now you should all quit protesting and pay me rent!”.

If you were an islander, would you be happy with the situation now?

By the way, this is essentially the way the world works today. How do you think the first owners of the land you're living on got to own the land? (Usual answer: they took it by force) Personally, I have no idea why people are not marching in the streets demanding a better system.

Is there a more just way of distributing land? Yes. An idea known as Georgism. The fact that houses get built on land makes the potential solutions more complex, but almost any system based on Georgist ideals would be better than what we have today… unless you’re a landlord that is.

Georgism: - look into it.

"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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Monopoly Is Theft
« Reply #155 on: March 02, 2014, 09:28:40 AM »
http://harpers.org/blog/2012/10/monopoly-is-theft/?single=1

Monopoly Is Theft

The antimonopolist history of the world’s most popular board game

By Christopher Ketcham
Harper's Magazine
October 19, 2012

The players at Table 25 fought first over the choice of pawns. Doug Herold, a forty-four-year-old real estate appraiser, settled on the car. The player across from him, a shark-eyed IT recruiter named Billy, opted for the ship and took a pull from a can of Coors. The shoe was taken by a goateed toxic-tort litigator named Eric, who periodically distracted himself from the game on a BlackBerry so that he “could get billable hours out of this.” The dog was taken by a doughy computer technician named Trevis, who had driven from Canton, Ohio, as a “good deed” to help the National Kidney Foundation, sponsor of the 25th Annual Corporate Monopoly Tournament, which is held each year in the lobby of the U.S. Steel Tower in downtown Pittsburgh. On hand for the event, which had attracted 112 players, divided into twenty-eight tables of four, were the Pittsburgh Steelers’ mascot, Steely McBeam, who hopped around the lobby grunting and huzzahing with a giant foam I beam under his arm; three referees dressed in stripes, with whistles around their necks; and a sleepy-looking man, attired in a long judges’ robe and carrying a two-foot-long oaken gavel, who was in fact a civil-court judge for Allegheny County donating his time “to make sure these people follow the rules.”

I had spoken the night before with Doug, who won the previous year’s tournament, about his strategy for victory. “Well, last year I managed to get Boardwalk and Park Place, and then everybody landed on them,” he explained, chalking his success up to dumb luck. “What you have to do,” he said, “is get a monopoly, any monopoly, as quickly as you can.” I asked him if he knew the secret history of the game. He confessed that he did not.

The official history of Monopoly, as told by Hasbro, which owns the brand, states that the board game was invented in 1933 by an unemployed steam-radiator repairman and part-time dog walker from Philadelphia named Charles Darrow. Darrow had dreamed up what he described as a real estate trading game whose property names were taken from Atlantic City, the resort town where he’d summered as a child. Patented in 1935 by Darrow and the corporate game maker Parker Brothers, Monopoly sold just over 2 million copies in its first two years of production, making Darrow a rich man and likely saving Parker Brothers from bankruptcy. It would go on to become the world’s best-selling proprietary board game. At least 1 billion people in 111 countries speaking forty-three languages have played it, with an estimated 6 billion little green houses manufactured to date. Monopoly boards have been created using the streets of almost every major American city; they’ve been branded around financiers (Berkshire Hathaway Monopoly), sports teams (Chicago Bears Monopoly), television shows (The Simpsons Monopoly), automobiles (Corvette Monopoly), and farm equipment (John Deere Monopoly).

The game’s true origins, however, go unmentioned in the official literature. Three decades before Darrow’s patent, in 1903, a Maryland actress named Lizzie Magie created a proto-Monopoly as a tool for teaching the philosophy of Henry George, a nineteenth-century writer who had popularized the notion that no single person could claim to “own” land. In his book Progress and Poverty (1879), George called private land ownership an “erroneous and destructive principle” and argued that land should be held in common, with members of society acting collectively as “the general landlord.”

Magie called her invention The Landlord’s Game, and when it was released in 1906 it looked remarkably similar to what we know today as Monopoly. It featured a continuous track along each side of a square board; the track was divided into blocks, each marked with the name of a property, its purchase price, and its rental value. The game was played with dice and scrip cash, and players moved pawns around the track. It had railroads and public utilities—the Soakum Lighting System, the Slambang Trolley—and a “luxury tax” of $75. It also had Chance cards with quotes attributed to Thomas Jefferson (“The earth belongs in usufruct to the living”), John Ruskin (“It begins to be asked on many sides how the possessors of the land became possessed of it”), and Andrew Carnegie (“The greatest astonishment of my life was the discovery that the man who does the work is not the man who gets rich”). The game’s most expensive properties to buy, and those most remunerative to own, were New York City’s Broadway, Fifth Avenue, and Wall Street. In place of Monopoly’s “Go!” was a box marked “Labor Upon Mother Earth Produces Wages.” The Landlord Game’s chief entertainment was the same as in Monopoly: competitors were to be saddled with debt and ultimately reduced to financial ruin, and only one person, the supermonopolist, would stand tall in the end. The players could, however, vote to do something not officially allowed in Monopoly: cooperate. Under this alternative rule set, they would pay land rent not to a property’s title holder but into a common pot—the rent effectively socialized so that, as Magie later wrote, “Prosperity is achieved.”

For close to thirty years after Magie fashioned her first board on an old piece of pressed wood, The Landlord’s Game was played in various forms and under different names—“Monopoly,” “Finance,” “Auction.” It was especially popular among Quaker communities in Atlantic City and Philadelphia, as well as among economics professors and university students who’d taken an interest in socialism. Shared freely as an invention in the public domain, as much a part of the cultural commons as chess or checkers, The Landlord’s Game was, in effect, the property of anyone who learned how to play it.

Thousands of Monopoly tournaments are held in the United States each year: county tournaments, school tournaments, church tournaments, corporate tournaments, tournaments in basements, in boardrooms, in lunchrooms, in public libraries, and online. Every four or five years there are the big officiated tournaments—the U.S. Championship and the World Championship—sponsored by Hasbro, which hands out $20,580 pots to the winners of each. I missed the big tournaments—both were last held in 2009—and instead ended up in the lobby of U.S. Steel. I thought the venue fitting, as the corporation was the brainchild of supermonopolists Andrew Carnegie and J. P. Morgan, the latter being the inspiration for Monopoly’s top-hatted, monocled, tails-wearing mascot, Rich Uncle Pennybags.

The emcee called the lobby to order, shouting into his microphone, “You have ninety minutes. Let’s play Monopoly!” Immediately, the men at Table 25 began rolling dice and frantically buying property as they rounded the board. Doug snagged Pacific Avenue (an expensive investment at $300), two yellow parcels, and several slummier properties. Trevis’s portfolio included two railroads and Marvin Gardens, the most expensive property in the yellow group. Billy held the ultrachic Boardwalk ($400). Eric got Tennessee Avenue and St. James Place ($180 each). These last are among the properties most coveted by competitors, because they are relatively cheap and frequently landed on, along with the other properties that sit directly downboard of the jail, where odds are the players will spend a lot of time.

Sixteen minutes into the game Doug offered Billy a trade. (“The propensity to truck, barter, and exchange one thing for another,” writes Adam Smith in The Wealth of Nations, “is common to all men, and to be found in no other race of animals.”) Land was already growing scarce, and as land becomes scarce in Monopoly—as in the real world—its market value rises, often beyond its nominal value. “This,” said Doug, holding up one of his yellow deeds, “for that,” pointing at one of Billy’s slum deeds, “plus three hundred bucks.”

Billy was unimpressed. “No, you give me three hundred bucks.”

“Give you three hundred bucks?”

“Cash is king!”

This in turn inspired Trevis and Eric to start haggling, with Billy and Doug interjecting to gum up the talks when their own interests were threatened. The table got loud. The parties offered, counteroffered, rejected all offers, sweetened the original offers, rejected the sweetened deals with greater aplomb. Doug heaved a great sigh. “We’re just gonna go around the board and around the board,” he said, “and collect our little money.”

“It’s gotta make sense for me,” said Trevis.

“This guy wants my left testicle,” Doug replied.

In what amounted to open conspiracy, Billy then told Eric that if they made a trade and each received a monopoly as a result, they’d share a “free ride”—no rent would be charged—when they landed on one another’s monopolies: a corrupt duopoly, in effect, targeting Doug and Trevis.

Doug shrugged as Eric pondered the deal, but Trevis was aghast. “You can’t do that—it’s against the rules.”

“Rules!” said Billy. “I’m gonna set my price.”

“Bullshit!”

“Ref!”

A referee, whistle around his neck, hurried over—the judge with the gavel had disappeared—to decide on the matter as the players barked at each other. “You can’t do that,” he said finally.

A few weeks before the tournament, I’d had a conversation with Richard Marinaccio, the 2009 U.S. national Monopoly champion. “Monopoly players around the kitchen table”—which is to say, most people—“think the game is all about accumulation,” he said. “You know, making a lot of money. But the real object is to bankrupt your opponents as quickly as possible. To have just enough so that everybody else has nothing.” In this view, Monopoly is not about unleashing creativity and innovation among many competing parties, nor is it about opening markets and expanding trade or creating wealth through hard work and enlightened self-interest, the virtues Adam Smith thought of as the invisible hands that would produce a dynamic and prosperous society. It’s about shutting down the marketplace. All the players have to do is sit on their land and wait for the suckers to roll the dice.

Smith described such monopolist rent-seekers, who in his day were typified by the landed gentry of England, as the great parasites in the capitalist order. They avoided productive labor, innovated nothing, created nothing—the land was already there—and made a great deal of money while bleeding those who had to pay rent. The initial phase of competition in Monopoly, the free-trade phase that happens to be the most exciting part of the game to watch, is really about ending free trade and nixing competition in order to replace it with rent-seeking.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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How a Progressive Tax System Made Detroit a Powerhouse (and Could Again)
« Reply #156 on: April 19, 2014, 02:34:07 PM »
http://inequality.org/progressive-tax-system-detroit-powerhouse/

How a Progressive Tax System Made Detroit a Powerhouse (and Could Again)

Detroit’s property tax base, diminished and badly-assessed, could still fund a renewal if Michigan would only read its history and find the political will.

By Mason Gaffney and Polly Cleveland
Inequality.org
August 9, 2013

In 1995, we encountered a group of economic advisors to Governor John Engler of Michigan, intent on cutting property taxes. We reminded them of California’s 1979 Proposition 13. After Prop. 13 rolled back and froze property taxes, sales taxes reached crushing levels, budget crises became routine, local services collapsed, and public schools fell from the best in the nation to among the worst. But Engler was determined.

From 1890-1930, Detroit’s population boomed from 205,000 to 1,569,000, the fastest growth of any US city. The auto industry did it, but why Detroit? Detroit had produced horse-drawn carriages from hardwood lumber, but so had other places. It was not low wages; Detroit paid better than most—that’s why so many people rushed in. It was not business-dominated politics; Michigan was a Progressive, Bull Moose Teddy Roosevelt state. It was not low taxes on wealthy “job-creators”; Michigan relied on high state and local property taxes. As most people recognized in those days, (and as we have documented here and here), property taxes are wealth taxes, dramatically more progressive than income taxes.

Detroit Mayor Hazen Pingree, 1889-1897, was an early Georgist Progressive. He supported the idea of American economist and reformer Henry George (1839-1897) that all taxes should be shifted onto land and other natural resources. Today, Nobel-Prize-winner Joseph Stiglitz advocates this as the “Henry George principle.” Applied to cities, it means raising property tax rates on land and lowering them on buildings. In cities, poor renters own no land, heavily-mortgaged middle classes own very little. So shifting taxes to land turns property taxes into wealth taxes on steroids. Better yet, taxing land discourages rich speculators from holding valuable property out of use. Mayor Pingree was a mentor to and model for the Georgist soon-to-be Mayors Tom Johnson and Newton Baker of Cleveland, and Samuel Jones and Brand Whitlock of Toledo.

The crash of 1893 hit Detroit soon after Pingree’s election. The city was riddled with vacant lots held by land speculators; Pingree arranged for the unemployed to plant vegetables. “Pingree’s Potato Patches” inspired other cities to follow. Meanwhile, he had campaigned for “higher taxes on the vast landed estates of the city”; when big industries threatened to leave town, he responded by raising just the land assessments. This won the support of small business.

The Georgist Progressive movement supported cheap mass transit on trolley cars. With fixed costs funded by property taxes, fares stayed low. Property taxes also paid for public education, public health, public parks, water, sanitation, welfare—all the public services that make a big city livable, and its small industries viable. Property tax rates of 2.5% of market value were normal; there were no sales taxes, business taxes, or income taxes. Detroit’s private sector was a big collection of small machine shops, little businesses and services. That’s what attracted Henry Ford, the Dodge brothers and other young tinkerers to Detroit. In one of history’s ironies, trolley cars nursed the auto industry that later rose up to slay them.

In 1897 Pingree became governor. He centralized the assessment of property taxes, and had the State Board of Tax Commissioners revalue all property. They found so much untaxed land, especially railroad holdings, that they actually lowered tax rates even as they raised more taxes.

During the “Dirty Thirties,” Detroit grew while many cities shrank. Walter Reuther’s UAW pioneered the sit-down strike at the GM plant in Flint. Former Detroit Mayor and now Governor Frank Murphy negotiated a settlement that legitimized the UAW, using the new national Wagner Act. It was “The strike heard round the world.” UAW membership exploded from 30,000 to 500,000.

After Pearl Harbor, FDR naturally turned to Detroit to convert its assembly lines to war production. This was the age of Rosie the Riveter, and Rosie loved Detroit. From 1930 to 1950, Detroit’s population grew 18%, to 1,850,000.

Yet after 1950, Detroit began to shrink, the first break in its sensational upward trajectory. What happened? Some blamed the end of the war, but America was pouring billions into the Interstate Highway System. The world wanted American cars and trucks. The causes of decline must have been internal.

Governor G. Mennen “Soapy” Williams, 1949-1960, introduced the Business Activities Tax (BAT), a kind of sales tax. The BAT was replaced by a corporate income tax in 1967 and by the Single Business Tax (SBT) in 1975. The SBT allowed the deduction of inputs—including real estate purchases!—but not labor. Easy for big corporations to evade, the SBT fitted concrete boots on small unincorporated businesses.

Governor George Romney, 1962-68, introduced a personal income tax to provide “property tax relief,” a new catchword. Meantime in Michigan and nationwide, the property tax itself was degenerating; effective rates were falling, especially on land. Its Georgist heritage forgotten, Detroit was valuing land at next to nil, using assessments dating from the Great Depression. In 1967, a police raid on an unlicensed late-night drinking club in a black neighborhood triggered Detroit’s notorious 12th Street riots, which destroyed over 2000 buildings. Detroit never recovered.

While Detroit hollowed out, its suburb Southfield boomed. From 1950-70 it grew from 19,000 to 69,000 people. It had a Georgist Mayor, James Clarkson, who aggressively raised land assessments and lowered building assessments. Southfield’s tax base actually rose by 20% per year under Clarkson, funding good utilities and public services. The lesson went unnoticed.

In 1995, despite our warnings to his staff, Governor John Engler took Michigan’s public schools off local property taxes and onto a state sales tax. That sealed Detroit’s fate. Out-migration of people and industry accelerated into the 2008 crash. Detroit’s current population of some 700,000 is the lowest since 1914. In another of history’s ironies, Detroiters today grow food in vacant lots—“Pingree’s Potato Patches” again, 105 years later. Bankruptcy seems inevitable.

And yet… Detroit’s property tax base remains. Though diminished and badly-assessed, it could still fund a renewal if Michigan reads its history and finds the political will.

For the full story, see Mason Gaffney’s New Life in Old Cities (2006) and What’s the Matter with Michigan? (2008)
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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"Trading one form of slavery for another," indeed!
« Reply #157 on: April 26, 2014, 01:37:25 PM »
Contrary to popular myth, the phenomenon of one form of slavery being traded for another long predates 1913...

http://www.wealthandwant.com/docs/ajo_slavery.html

SLAVERY

By Arthur J. Ogilvy

THE SLAVER

Suppose I own a sugar estate and 100 slaves, all the land about being held in the same way by people of the same class as myself.

It is a profitable business, but there are many expenses and annoyances attached to it.

I must keep up my supply of slaves either by buying or breeding them.

I must pay an overseer to keep them continually to their work with a lash. I must keep them in a state of brutish ignorance (to the detriment of their efficiency), for fear they should learn their rights and their power, and become dangerous.

I must tend them in sickness and when past work.

And the slaves have all the vices and defects that slavery engenders; they have no self-respect or moral sense; they lie, they steal, they are lazy, shirking work whenever they dare; they do not care what mischief their carelessness occasions me so long as it is not found out; their labor is obtained by force, and given grudgingly; they have no heart in it.

All these things worry me.

FLASH! ....

Suddenly a brilliant idea strikes me. I reflect that there is no unoccupied land in the neighbourhood, so that if my laborers were free they would still have to look to me for work somehow.

So one day I announce to them that they are all free, intimating at the same time I will be ready to employ as many as I may require on such terms as we may mutually and independently agree.

What could be fairer? They are overjoyed, and falling on their knees, bless me as their benefactor. Then they go away and have a jollification, and next day come back to me to arrange the new terms.

THEY BELIEVE ...

Most of them think they would like to have a piece of land and work it for themselves, and be their own masters. All they want is a few tools they have been accustomed to use, and some seed, and these they are ready to buy from me, undertaking to pay me with reasonable interest when the first crop comes in, offering the crop as security. As for their keep, they can easily earn that by working a few weeks on and off on any of the plantations, or by taking a job clearing or fencing, or such like. This will keep them going for the first year, and after that they will be better able to take care of themselves.

HOLD ON, NOW!

"But," softly I observe, "you are going too fast. Your proposals about the tools and seed and your maintenance are all right enough, but the land, you remember, belongs to me. You cannot expect me to give you your liberty and my own land for nothing. That would not be reasonable, would it?" They agree it would not, and begin to propose terms.

A fancies this bit of land, and B that. But it soon appears that I want this bit of land for my next year's clearing, and that for my cows, and another is too close to my house and would interfere with my privacy, and another is thick forest or swamps, and would require too long and costly preparation for me who must have quick returns in order to live, and in short that there is no land suitable that I care to part with.

THE BENEFACTOR

Still I am ready to do what I promised — "to employ as many as I may require, on such terms as we may mutually and independently agree." But as I have now got to pay them wages instead of getting their work for nothing. I cannot of course employ all of them. I can find work for ninety of them, however, and with these I am prepared to discuss terms.

At once a number volunteered their services at such wages as their imagination had been picturing to them. I tell the ninety whose demands are most reasonable to stand on one side. The remaining ten look blank, and seeing that since I won't let them have any of the land, it is a question of hired employment or starvation, they offer to come for a little less than the others. I tell these now to stand aside, and ten others to stand out instead. These look blank now, and offer to work for less still, and so the "mutual and voluntary" settlement of terms proceeds.

But, meanwhile, I have been making a little calculation in my head, and have reckoned up what the cost of keeping a slave, with his food and clothes, and a trifle over to keep him contented, would come to, and I offer that.

They won't hear of it, but as I know they can't help themselves, I say nothing, and presently first one and then another gives in, till I have got my ninety, and still there are ten left out, and very blank indeed they look. Whereupon, the terms being settled, I graciously announce that though I don't really want any more men, still I am willing, in my benevolence, to take the ten, too, on the same terms, which they promptly accept, and again hail me as their benefactor, only not quite so rapturously as before.

WAGE SLAVES? ...

So they all set to at the old work at the old place, and on the old terms, only a little differently administered; that is, that whereas I formerly supplied them with food, clothes, etc., direct from my stores, I now give them a weekly wage representing the value of those articles, which they will henceforth have to buy for themselves.

There is a difference, too, in some other respects, indicating a moral improvement in our relations. I can no longer curse and flog them. But then I don't want to; it's no longer necessary; the threat of dismissal is quite as effective, even more so; and much pleasanter for me.

I can no longer separate husband from wife, parent from child. But then again, I don't want to. There would be no profit in it; leaving them their wives and children has the double advantage of making them more contented with their lot, and giving me greater power over them, for they have now got to keep these wives and children out of their own earnings.

My men are now as eager as ever to come to me to work as they formerly were to run away from work. I have neither to buy or breed them; and if any suddenly leave me, instead of letting loose the bloodhounds, I have merely to hold up a finger or advertise, and I have plenty of others offering to take their place. I am saved the expense and worry of incessant watching and driving. I have no sick to attend, or worn-out pensioners to maintain. If a man falls ill there is nothing but my good nature to prevent my turning him off at once; the whole affair is a purely commercial transaction — so much wages for so much work. The patriarchal relation of slave-owner and slave is gone, and no other has taken its place. When the man is worn out with long service I can turn him out with a clear business conscience, knowing that the State will see that he does not starve.

Instead of being forced to keep my men in brutish ignorance, I find public schools established at other people's expense to stimulate their intelligence and improve their minds, to my great advantage, and their children compelled to attend these schools. The service I get, too, being now voluntarily rendered (or apparently so) is much improved in quality. In short, the arrangement pays me better in many ways.

REJOICE! I AM CAPITAL AND I EMPLOY PEOPLE!

But I gain in other ways besides pecuniary benefit. I have lost the stigma of being a slave driver, and have, acquired instead the character of a man of energy and enterprise, of justice and benevolence. I am a "large employer of labour," to whom the whole country, and the labourer especially, is greatly indebted, and people say, "See the power of capital! These poor labourers, having no capital, could not use the land if they had it, so this great and far-seeing man wisely refuses to let them have it, and keeps it all for himself, but by providing them with employment his capital saves them from pauperism, and enables him to build up the wealth of the country, and his own fortune together."

Whereas it is not my capital that does any of these things. lt is not my capital but the labourer's toil that builds up my fortune and the wealth of the country.

It is not my employment that keeps him from pauperism, but my monopoly of the land forcing him into my employment that keeps him on the brink of it. It is not want of capital that keeps the labourer from using the land, but my refusing him the use of the land that prevents him from acquiring capital. All the capital he wants to begin with is an axe and a spade, which a week's earnings would buy him, and for his maintenance during the first year, and at any subsequent time, he could work for me or for others, turnabout, with his work on his own land. Henceforth with every year his capital would grow of itself, and his independence with it, and that this is no fancy sketch, anyone can see for himself by taking a trip into the country, where he will find well-to-do farmers who began with nothing but a spade and an axe (so to speak) and worked their way up in the manner described.

ENTER THE LANDLORD ....

But now another thought strikes me. Instead of paying an overseer to work these men for me, I will make him pay me for the privilege of doing it. I will let the land as it stands to him or to another — to whomsoever will give the most for the billet. He shall be called my tenant instead of my overseer, but the things he shall do for me are essentially the same, only done by contract instead of for yearly pay. He, not I, shall find all the capital, take all the risk, and engage and supervise the men, paying me a lump sum, called rent, out of the proceeds of their toil, and make what he can for himself out of the surplus.

The competition is as keen in its way for the land, among people of his class, as it is among the labourers for employment, only that as they are all possessed of some little means (else they could not compete) they are in no danger of immediate want, and can stand out for rather better terms than the labourers, who are forced by necessity to take what terms they can get.

The minimum in each case amounts practically to a "mere living", but the mere living they insist on is one of a rather higher standard than the labourers'; it means a rather more abundant supply and better quality of those little comforts which are next door to necessaries. It means, in short, a living of a kind to which people of that class are accustomed.

For a moderate reduction in my profits, then — a reduction equal to the tenant's narrow margin of profit — I have all the toil and worry of management taken off my hands, and the risk too, for be the season good or bad, the rent is bound to be forthcoming, and I can sell him up to the last rag if he fails of the full amount, no matter for what reason; and my rent takes precedence of all other debts.

All my capital is set free for investment elsewhere, and I am freed from the odium of a slave owner, notwithstanding that the men still toil for my enrichment as when they were slaves, and that I get more out of them than ever.

If I wax rich while they toil from hand to mouth, and in depressed seasons find it hard to get work at all; it is not, to all appearances, my doing, but merely the force of circumstances, the law of nature, the state of the labour market — fine sounding names that hide the ugly reality.

If wages are forced down it is not I that do it; it is that greedy and merciless man the employer (my tenant) who does it. I am a lofty and superior being, dwelling apart and above such sordid considerations. I would never dream of grinding these poor labourers, not I! I have nothing to do with them at all; I only want my rent -- and get it. Like the lilies of the field, I toil not, neither do I spin, and yet (so kind is Providence!) my daily bread (well buttered) comes to me of itself. Nay, people bid against each other for the privilege of finding it for me; and no one seems to realise that the comfortable income that falls to me like the refreshing dew is dew indeed; but it is the dew of sweat wrung from the labourers' toil. It is the fruit of their labour which they ought to have; which they would have if I did not take it from them.

This sketch illustrates the fact that chattel slavery is not the only nor even the worst form of bondage. When the use of the earth — the sole source of our daily bread — is denied unless one pays a fellow creature for permission to use it, people are bereft of economic freedom. The only way to regain that freedom is to collect the rent of land instead of taxes for the public domain.

Once upon a time, labour leaders in the USA, the UK and Australia understood these facts. The labour movements of those countries were filled with people who fought for the principles of 'the single tax' on land at the turn of the twentieth century. But since then, it has been ridiculed, and they have gradually yielded to the forces of privilege and power — captives of the current hegemony — daring no longer to come to grips with this fundamental question, lest they, too, become ridiculed.

And so the world continues to wallow in this particular ignorance — and in its ensuing poverty and debt.
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Geolibertarian

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The Ultimate Tax Reform: Public Revenue from Land Rent
« Reply #158 on: May 05, 2014, 05:04:55 PM »
Since neither Porter Stansberry nor those of a similar ideological bent will ever mention the following when singing praises about Singapore, I thought I would:

http://heartland.org/policy-documents/ultimate-tax-reform-public-revenue-land-rent-summary-html

The Ultimate Tax Reform: Public Revenue from Land Rent

Fred E. Foldvary
The Heartland Institute
January 1, 2006

This analysis explains why land value taxation is, as Milton Friedman once put it, the “least bad” tax. An ideal tax system respects a person’s right to privacy, does not discourage work or savings, and does not induce dishonesty. While income, sales, and value-added taxes fall woefully short of this ideal, land value taxation meets each requirement. The supply of land is fixed, immobile, and inherently visible. If land value is taxed, the land will not flee, shrink, or hide. Once citizens, taxpayers, consumers, and voters understand the option of obtaining public revenue from land value or rent, then the logic of getting both greater efficiency and greater justice may prevail.

1. The U.S. tax system needs reform.

The U.S. tax system is widely perceived as too complex, too intrusive, and too demanding of workers’ paychecks. Taxes today claim a greater share of the average family’s budget than food, clothing, housing, and transportation combined. In 2005, the average American had to work 107 days just to pay taxes, compared to 44 days in 1930.

The “least bad” tax policy is one that does not violate a citizen’s right to the fruits of his labor or his privacy; does not distort incentives to work and save; and minimizes the costs of compliance and administration. Taxes on income, sales, capital gains, and real property fail this test. Compliance with the income tax consumes 5 billion hours each year in the U.S., the equivalent of two million people working full time just to process the income tax. Sales taxes discourage production of some goods and distort consumer choices. The collection of sales and income taxes require that government collect information and invade people’s privacy.

Some economists and institutes have proposed reforms to flatten and simplify the income tax, or to replace it entirely with a national sales or consumption tax or value-added tax. These would be an improvement, but if the goal is to fundamentally reform the tax system, then moving to an entirely different kind of tax land value taxes needs to be on the table.

2. What is land value taxation?

Land value taxation is a tax on land, not the buildings, homes, or other structures that might occupy the land. The proposal here is to replace some or even all of the revenue produced by other taxes with a tax on land value.

What makes land value taxation so different from other forms of taxation is that the supply of land is fixed, immobile, and inherently visible. Public revenue from land values is the most complete application of “supply-side” economic policy. Supply-side policy attempts to increase production and the supply of goods by decreasing costs, such as by lowering taxes and eliminating excessive regulations and barriers to trade. A complete tax shift away from taxing production to taxing land values would be the ultimate supply-side policy, since it removes the excess economic burden of taxation.

Unless you own a valuable vacant lot, land value taxation would most likely reduce your total tax bill, since it could abolish taxes on your earnings and spending as well as the portion of real property taxes that falls on buildings and other improvements.

3. Land value taxation compares favorably to other taxes.

Impact on production. When something is taxed, we get less of it. Income taxation discourages work, sales and value-added taxes discourage consumption, capital gains taxes discourage investment, and real property taxes discourage building and improving property. Since the supply of land is fixed, taxing it does not reduce its supply. Consequently, land value taxation is pro-economic growth.

Impact on behavior. Income taxes impose administrative costs on government and compliance costs on taxpayers. Income taxes punish savings, while sales taxes punish borrowing and consuming. Tapping land value, by contrast, does not distort an individual’s choice to save or borrow, consume or invest. Human action would be liberated from the disincentives currently imposed by other taxes.

Least opportunity for tyranny and evasion. Income taxes require tax audits, bank account seizures, and fear-inspiring letters from the IRS requesting information or additional payments or imposing interest and penalties. Such threats to liberty would greatly diminish, if not entirely disappear, under a land value tax. Land value taxation involves less invasion of privacy than taxing the whole property, since land value assessors do not need to enter the property to assess the new pipes, the expanded wiring, the renovated kitchen, or the new cottage in the back.

4. Land value taxation is not a new idea.

The concept of taxing land values for public finance is ancient. The Bible declares “the profit of the Earth is for all” (Ecclesiastes 5:9). Land rent financed government in England during the Middle Ages. Land value taxation was viewed favorably by classical economists, starting with Adam Smith, who wrote, “Ground-rents, and the ordinary rent of land, are, therefore, perhaps, the species of revenue which can best bear to have a particular tax imposed upon them. Ground-rents seem, in this respect, a more proper subject of particular taxation than even the ordinary rent of land.”

Thomas Jefferson believed “the Earth is given as a common stock for men to labour and live on.” In 1797, he suggested “a land tax supply the means by which the individual States were to contribute their quotas of revenue to the Federal Government.”

Contemporary economists who have recognized and supported land value taxation include Leon Walras, Knut Wicksell, Kris Feder, Mason Gaffney, C. Lowell Harris, Fred Harrison, Nicolaus Tideman, and the late William Vickrey (winner of the 1996 Nobel Prize in economics). Milton Friedman, a world-famous free-market economist, once stated, “the least bad tax is the property tax on the unimproved value of land, the Henry George argument of many, many years ago.”

5. Land value taxation works in practice.

Taiwan, Hong Kong, and Singapore became major commercial centers in large part because much of their public finance is based on taxing land values, rather than taxing trade and commerce. Many private communities implement what amounts to land value taxation as a fee or assessment. A condominium owner owns his unit and a share of the “common elements” such as building exteriors, landscaping, and recreation facilities. Similarly, guests in a hotel pay a rental for one room and receive hotel amenities such as transportation (elevators), the lobby, hallways, and swimming pool. Owners of mobile homes pay rent for sites along with services, and boat owners similarly pay for a space along with amenities.

[...]

Johannesburg, South Africa and Sydney, Australia have levied real estate taxes on land values only.

Some cities in Pennsylvania have had a two-rate system, where land values are taxed at a rate higher than the tax on improvements. In Arden, Delaware, all residential land is owned by a trust. It leases the land to the residents, who pay rent only on their leaseholds. The trust itself pays property taxes to the county.

6. Land value taxation would reduce the size and cost of government.

A tax on land value in the U.S. would provide about 60 percent of the entire current tax revenues of the federal, state, and local governments, allowing all other existing taxes to be abolished. The revenue would be more than adequate to finance existing government spending on everything other than transfer payments. But even if land value taxation did not yield as much revenue as all other taxes now collectively raise, this is no argument against shifting as much public revenue as possible to rent-based sources.

Land value taxation also would result in a substantial reduction in the cost of government. The administrative cost of land value taxes would be less than that of existing property taxes (which require a greater inspection of buildings and improvements), and the cost of enforcing income and sales taxes would be eliminated. By improving economic growth and allowing workers to keep all the money they earn, land value taxation would result in higher incomes, reducing the demand for government welfare programs.

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0

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San Francisco Landlord Tells Tenants: Make $100K, Have 725 Credit Score
« Reply #159 on: May 08, 2014, 05:11:41 PM »
And what's the Austrian School "solution" to the following? Make publicly-generated land values even more privatized than they already are.  ::)

http://abcnews.go.com/Business/san-francisco-landlord-tells-tenants-make-100k/story?id=23611110

San Francisco Landlord Tells Tenants: Make $100K, Have 725 Credit Score

By Alan Farnham
ABC News
May 06, 2014

[Video clip omitted - see original article]

How tight is San Francisco’s housing market? So tight that the landlord of a rent-controlled apartment building at 312 Fillmore Street has sent a memo to his existing tenants, telling them they must show they have an annual income of at least $100,000 and a FICO credit score of at least 725.

Or else...what? The memo (which describes itself as “informational”) doesn't say.

When ABC News phoned landlord Robert Shelton to ask, he hung up. When an ABC News reporter knocked on his door, Shelton slammed it in her face.

Local housing and tenants’ rights experts tell ABC News they are in no doubt what such memos are meant to accomplish: They’re supposed to scare the heck out of tenants, on the chance that ones unaware of their rights will vacate.

Landlords want old tenants out so that they charge new ones higher rent, explains Delene Wolf, executive director of the San Francisco Rent Board. She tells ABC News she has specialized in local rent control issues for 30 years. But, she says, “I have never seen rents like this--not even during the dotcom boom. A teeny 1-bedroom can go for $4,000 a month.” The bidding-up of rents she calls a frenzy. The market, she says, "is amazing--but not in a good way.”

[Continued...]
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://schalkenbach.org
http://www.monetary.org
http://forum.prisonplanet.com/index.php?topic=203330.0