A Fool’s Paradise - NYTimes.com.
The article describes the fact that wages have stagnated for most of us, and that a series of events, including the entrance of wives and mothers into the workplace, and the increasing tolerance for debt, have been what has kept the bottom three quarters of the income spectrum afloat. It ends,
And that won’t begin to happen until we roll up our sleeves and begin the immensely hard and expensive work of rebuilding a nation that unconscionably was allowed to slip into a precipitous state of decline. We’ll end up spending trillions for the wars in Iraq and Afghanistan and another trillion, at least, to clean up after the madmen on Wall Street.
Now we need to find the money and the will to put Americans to work rebuilding the nation’s deteriorating infrastructure, revitalizing its public school system, creating a new dawn of energy self-sufficiency and rethinking our approach to an economy that remains tilted wildly in favor of the rich.
So how do we do that? Herbert's answer is "That's what the presidential campaign should be about."
But I'll submit that neither of the major party candidates, and, likely, none of the third party candidates, have the answer. That isn't to say there isn't an answer. We just haven't heard anything about it yet from any of these candidates.
I think the answer lies in the observations of Henry George, and that the Remedy he laid out in his landmark book, Progress and Poverty (1879). The subtitle to that book, An inquiry into the cause of industrial depressions and of increase of want with increase of wealth ... The Remedy," seems pretty timely.
Herbert's final paragraph, suggesting that we spend on infrastructure, is a good idea, despite the fact that Herbert has no notion how such spending ought to be funded.
- It shouldn't be funded by borrowing -- funds that our children and grandchildren must repay to lenders.
- It shouldn't be funded by taxing wages, or corporate profits.
- It shouldn't be funded by taxing sales or other transactions.
- Rather, it should be funded by a tax on that which is enhanced by good infrastructure, and which exists in significant part BECAUSE of the existence of good infrastructure: Land Value. Why should the value we create by our initial investment in creating infrastructure or our subsequent investment in keeping it well maintained be paid for from any tax base other than the value that investment creates?
And when we utilize that tax on land value, one of the effects will be a reduction of the energy we utilize. Why? Because well-located land -- that is, land close to amenities people value, land well-served by infrastructure -- will be used more intensively. Its owners will simply not be able to afford to keep it underused for long! Their incentives would be to put it to good use, both because we would remove the tax on the buildings we create and because they would need to meet market wants in order to pay their land tax. That might be for commercial space, or housing, or whatever the market is calling for. Some of us will still prefer to have an acre in the suburbs, with a longish commute. But many more of us might be very content with a comfortable, affordable, modern, well-insulated home within a short commute of our work, if we are confident in our schools' ability and commitment to educating our children well. And if we can create a society where there is housing for all, at a price people can afford, many more of us will be able to provide our children what they need. And society will be in a position to help the rest.
I hope that Bob Herbert and those who are planning the next administration -- in both parties -- will take the time to acquaint themselves with the ideas of Henry George. They are the single best approach to what are otherwise unsolvable problems. His diagnosis and his remedy should be required reading, for all who seek a better place for all of us to live.
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