LVTFan's Blog

Dr. McGlynn's Lesson from the 1886 New York City Election

What follows is one of three analyses of the 1886 Mayoral election in Manhattan, which appeared in the December, 1886, issue of North American Review (see https://www.jstor.org/stable/pdf/25101145.pdf) under the title "Lessons of the New York City Election."  The authors are listed as "A Republican, Edward McGlynn and S. S. Cox."

One might consider this a supplement to Post & Leubuscher's December 1886 book, Henry George's 1886 Campaign, online at 

II.
THE LABOR PARTY VIEW.

The late contest for the chief municipal office of New York marks an historical epoch. The movement to elect Henry George to that office has been something exceptional, in fact, unique, in its inception, in its growth, and in its results, in the character of its originators, in the sympathies it won, and in the opposition it evoked. It has had an unprecedented effect in confusing and disabling political plans and factions; and it has rendered inevitable, has, in fact, already begun, the disintegration and reconstruction of political parties. It is the beginning of a pacific revolution which is destined to have upon the whole world a more beneficent effect than our first Revolution and the great Declaration which gave it its justification and battle-cry.

All this was substantially said by me at the meeting in Chickering Hall a month before the election, and was then no doubt regarded by not a few as but a campaign extravagance — a mere rhapsody inspired by foolish hopefulness of the perfectibility of human society, and by a simple but absurdly enthusiastic hero-worship. Events, however, have largely justified tho declaration made at that meeting.

After our mighty civil struggle had ended, with a Union restored and a race emancipated; after the question of reconstruction had been settled, and a large part of the burdens of the war discharged; after its deepest wounds had been healed, and even their scars obliterated, everything might have seemed to promise a long period of unexampled national prosperity and contentment. Instead of this, a new sense of disappointment and discontent began to steal over the workers of the country. With increasing wealth, they felt the pressure of increasing want. Labor in mill and mine, on railroad and farm, became more and more conscious of a wrong, in the want of opportunity to employ itself, and in the inadequate share of the product of his toil which came back to the toiler. Maddened and blinded, the giant Labor too often struck out wildly to his own hurt, and eagerly snatched at such panaceas as “protection,” urged on him by the quacks, who found profit in his ignorance. Strikes, wasteful and sometimes violent; lock-outs, long and heartless, increased and multiplied. Waves of industrial depression followed each other with a regular periodicity which suggested a law of nature. The cry was heard everywhere, “the rich were becoming richer and the poor poorer.” “Hail, Columbia, happy land!” was no longer sung with the same heartiness as in the childhood of the nation, and even the Fourth of July seemed to have lost the freshness of its charm. In the reading of the magnificent assertion of the natural equality of man, and his inalienable rights to life, liberty, and the pursuit of happiness, there seemed to many an undertone of mockery. But deeply as the growing wrong was felt, there was a failure to clearly see its cause. Voices many were raised in complaint, but they were now the roar of a strong lion helpless in the toils, and now the wail of a child crying in the night. There was lacking the clear articulate speech of a man who, seeing a great truth, sounds a trumpet-call to all who would taste the fierce delight of battle against wrong.

But the hour came at last, and with it the man. The Duke of Argyll spoke better than he knew, when he sneeringly called Henry George the “Prophet of San Francisco.” No heart has sympathized more keenly with the sufferings of the toiler, no other pen has defined the wrong so clearly, and portrayed with such force and pathos the poverty that haunts progress like a spectre. No other voice has rung so loud and clear in calling men to take up the cross of a new crusade for justice, to proclaim the glad tidings of a new evangel to the poor, that shall relieve them from the degradation of want, and the deeper degradation of the fear of want. His cry rang forth, calling on the conscience of men to restore to the disinherited their equal share in the bounties of nature, and thus to fit their hearts and minds the better to receive and act out the old evangel of Him, who taught the universal Fatherhood of God and the equal Brotherhood of men. The common people of old heard the Christ gladly as He preached to them the blessedness of those that hunger and thirst after justice; and in the common people of today the same sure instinct responds to the call for social right-doing.

What gives to the late election its deep importance is that it marks the coming of a great principle into our politics; that it is a flashing into action of sentiments that have spread and are yet spreading wide and deep throughout the land and over the world. Henry George’s nomination was no accident. The working-people of New York, like their fellows throughout the country, have been reading and talking over his books, and are better acquainted with them, and have a keener appreciation of them, than most men of leisure and culture. They have learned from Henry George’s teachings an effectual and peaceful method of righting their wrongs, by the reformation of law on the lines of justice. They have got from him a new hope and courage; they have learned that the remedy must be political, since the wrong is political, proceeding from enactments that give to a few that which belongs to all. Henry George has taught them that it is not desirable nor possible to divide land equally; that the right of the individual is not to an equal division, but to an equal benefit from a common ownership. Henry George has shown that the beautiful economic law of rent suggests a simple and peaceful means of giving to every human being just what belongs to him of the common estate. He shows that rent is a good, not a bad, thing; that it is a gauge of the degree of progress from semi-barbaric, nomadic conditions up to conditions of the highest civilization. He shows that economic rent — that “unearned increment” which attaches to land by reason of the growth of population and the progress of civilization — is a value produced by the social aggregate, as distinguished from the value produced by the individual, and that thus is provided, by natural law, a common fund which may be drawn on for common needs without hampering capital or oppressing labor by taxes which check production and raise prices. He shows that it is just that he who is permitted to enjoy the advantage or privilege of occupying a larger or choicer portion of the common estate than is open to another, should pay the highest market price for this advantage: that is rent. The wrong is not in the payment of rent, but in its diversion from a common treasury into private pockets, and in the locking up of natural opportunities by the speculation which the possibility of appropriating this public revenue provokes. Henry George has taught that in this appropriation of rent by private persons, and in the forestalling which it engenders, is to be found the cause of that increasing poverty which is the dark side of progressing civilization, the true cause of the industrial depressions in which productive power is so enormously wasted, and in which willing hands cannot clothe the naked back, or feed the hungry stomach, because labor is shut out from natural opportunies for its employment by the speculation that holds land idle until it can get a blackmail price.

How this speculation in land grinds down the wages of labor, cuts down the profits of capital, and brings about these periodical industrial depressions, “Progress and Poverty” and “Social Problems” have taught the thousands on thousands who have read them. They have shown how the simple remedy of the appropriation of economic rent to its proper purpose, the public use, would destroy speculation in the elements of nature, and thus open to labor the natural opportunities which are required for the production of wealth; how in reality there is no conflict between labor and capital, but that the real conflict is between labor and monopoly. Workingmen have learned from Henry George that the simple reform which would thus give them the highest possible wages would make the cost of living much lower, since the enormous taxes which now fall with oppressive weight on the poor, and are a fruitful source of political corruption, could be entirely remitted, as no longer necessary. All the public needs that are now supplied by taxation, and many public conveniences and advantages which we have not yet become civilized enough to supply at public cost, could be provided for out of the common fund — the rent which individuals would pay to a community that included themselves.
When, therefore, organized labor, as represented in the Central Labor Union of New York City, determined to take political action, it was necessary and fitting that the doctrine of “the land for the people” — the doctrine that all are entitled to share in the benefits provided by their Creator, and the advantages which come with social growth and improvement — should be made, as it was, the chief principle of their platform, — a platform which, in its bold simplicity, is in inspiriting contrast to the straddling duplicities of the old party declarations. And it was equally fitting that they should call on Henry George to become their spokesman and standard-bearer. No other man could so well fit the platform.

When, some three or four months ago, members of the Central Labor Union began to talk among themselves of the propriety of political action, the most sanguine among them had little hope of doing more than making a small beginning. Mr. George from the first was spoken of as the candidate who could command the strongest following; yet the best they hoped for was that an independent Labor candidate might get some 15,000 votes. For they sadly remember how, a few years ago, a Labor candidate for Mayor polled only 87 votes. They knew by experience how strong were the political organizations of New York, how potent the “influences” on which these relied, and how general was the indisposition of men to "throw their votes away” on a candidate who had not a “regular” nomination. Mr. George’s own friends felt that his world-wide reputation, and the cause with which he, more than any other man, is identified, should not be subjected to the risk of being made ridiculous by a hopeless canvass. But pressed to accept the nomination, and anxious to maintain the dignity of his cause, and to inspire those disposed to vote for him with confidence in themselves, Mr. George conditioned his acceptance on a pledge from 30,000 voters, explaining the significance of the movement and of his candidacy in his now famous letter to the Secretary of the Labor Union Conference. That letter began the campaign. It infused into the movement a peculiar dignity and enthusiasm. Clergymen, lawyers, teachers, authors, business men of all kinds, joined the Labor men in requesting Mr. George to be a candidate, and crowded the meetings held to ratify his nomination.

The campaign is so recent that it would be useless to recount it here. Great as must have been the growth in economic and political education, in self-respect and self-restraint, in the ranks of organized labor to produce the astonishing result, yet it must be conceded that no other platform and no other candidate could have secured such a tremendous moral victory. It is the reputation of the candidate, his high genius and exalted character, his practical wisdom and masterly leadership, his tireless energy, the strange fascination his personality exerts, and the almost religious enthusiasm which he has been able to inspire by his presentation of the cause, that have given to the 68,000 men, who, in spite of all difficulties, voted for him, and to the thousands more in New York who are now prepared to join them, the consciousness of power, the conviction of duty, and the confidence of ultimate success. Thus has come to the front a new Land and Labor party, from henceforth utterly distinct from all other parties, prepared to go forth conquering and to conquer; and on the same platform and under the same leader to repeat, at the earliest possible moment, in the State and in the nation, this magnificent canvass, and to more than repeat the moral victory of the late municipal election in New York.

Edward McGlynn.

Terrence Powderly: On Earth Peace, Good Will Toward Men (Cosmopolitan, December, 1891)

 

"ON EARTH PEACE, GOOD WILL TOWARD MEN."

T. V. POWDERLY.

Terence V. Powderly was born January 22, 1849, at Carbondale, Pennsylvania. His parents were natives of Ireland and were honest hard-working people.The boy's school days ended at the age of thirteen.  At fourteen he was examiner for the Delaware and Hudson Canal company: at seventeen he was apprenticed in the Delaware, and Hudson shops to learn the trade of machinist; at twenty he was a machinist in the locomotive shops of the Lackawanna railway at Scranton, and in 1871 joined a labor organization.  Two years later, in spite of the fact that he was a Conservative, he was discharged from the shops because of his activity in the labor union.  He worked at his trade wherever he could find employment notwithstanding the "black list" until 1878, when he was elected Mayor of Scranton, an office he retained for six years. He has been a chief factor in organizing the Knights of Labor, whose General Master Workman he has been since 1879.

IT is easier to point out the wrong than rectify it, less difficult to find something to condemn or find fault with than praise or endorse; and in the field of industry, while the advance toward better conditions has been more rapid during the past decade than for centuries before, the results are not so apparent to the worker in the field as to the looker-on. The great danger which presented itself to the people fifteen years ago was the law. The poor were without friends: they were the recipients of denunciation from statesman, press and pulpit. It was considered rude to even hint that the man who soiled his hands in manual toil had a right to any consideration other than a patronizing kindness at the hands of his employer, and to suggest that others should take an interest in his welfare was to incur the displeasure of society. The law made it a crime to be idle and gave to employers the privilege of turning the workman away without protest. To be out of money and on "tramp" was an offense against the law: it is today, but is not punished so rigorously as it used to be.

Government and Revenue

Some governments are better than others, but there is not a really good government on the face of the earth that raises its revenues by indirect taxation. It is impossible. Such a government must rob one citizen of wealth to enrich another; it must impoverish millions of consumers to favor a few hundreds or thousands of producers. It cannot be just. The wit of man cannot devise a method by which a government can make one citizen a favorite without making other citizens victims. . . . 

We shall learn if we enquire: To whom does rent belong? We are speaking of economic rent solely—rent of land or other franchise or privilege. Most assuredly economic rent belongs to the general community which creates it. It cannot belong to the laborer. He has done no more to create it than any other man. And this is true of the capitalist, and it is just as true of the ground landlord. He has done no more to create rent value (site value) than has the tenant or any other man. The value, ground rent, is communal value, created solely by the community, and should be  appropriated by the community for public use. It is the natural revenue which nature provides; and when men first allowed this natural public revenue to be diverted into private hands they let loose a whole train of social evils on mankind.

It is easier to point out the economic errors into which past generations of mankind have strayed than to provide a proper remedy. That must be a work of time and thought and education and statesmanship. But the first absolutely necessary step to be taken is to learn and understand and acknowledge the error. When that is done statesmen will be confronted with the most important problem of the age — the introduction of a method of raising public revenues that shall be natural, unburdensome, impartial and just.

 

GOVERNMENT AND REVENUE

Notwithstanding the contentions of philosophical anarchists and extreme individualists some form of organized government is an absolute necessity of human society. No condition of human society, however perfect, can be imagined in which organized government would not be necessary. If government were no longer necessary for the suppression of crime, if every individual were a sincere altruist, an established authority would still be required to decide on the thousand etceteras of streets, roads, railways, bridges, schools, inheritances and many other things which could not possibly be left to individual initiative and control.

It is equally clear and equally true that government requires public revenue. Society could not exist without government, and government could not exist without revenue. The matter of taxation is the most important question that can engage the attention of citizens; and, more vitally than any other question, it concerns their material and social conditions.

A 1927 article on Taxation

TAXATION QUARTERLY October, 1927

TAXATION
Baltimore, Md, 10-7-1927.

It is impossible to talk taxes without talking government. One is justified is saying: No taxes, no government; no government, no taxes which is to say, if we had no taxes governments could not exist and if we had no governments no taxes would be necessary. All of us agree that society cannot exist without government, therefore taxes are a necessity. For just what food is to the human body, taxes are to government, and just as the human body can sustain life for a long time on poor food taken irregularly at wrong times and in wrong proportions, so government can be sustained for an indefinite period upon bad taxes that are oppressive, unjust, badly collected and in many respects injurious; but as bad food finally breaks down the health of the body so do bad taxes ultimately destroy the health and sometimes even the life of the body politic.

It is asserted that Rome owed its decline to bad systems of taxation as much as it did to slavery itself, for just at the time the 100 percenters were hollering the loudest the tax gatherers were so cruel and unjust in their efforts to squeeze the last cent out of the people that their morale was destroyed, their patriotism killed, and it became a matter of indifference to them under which taxing machine they lived. The same spirit was shown in our own country after this last war, when it was often said, “What's the use of trying to make money in your business when the government comes along and takes it away again?” Let this spirit become general and what happened to Rome will happen here. It only emphasizes the truth of the saying, THE POWER TO TAX IS THE POWER TO DESTROY. This power when used wrongly permits tyranny and robbery, all the more dangerous because they are carried on under the guise of law and because they are hidden.

U.S. Government Sells 400,000 Acres in Gulf

Why on earth would we-the-people sell assets such as this instead of leasing them, producing an income that would benefit future generations???   That would be Natural Public Revenue.

 

The value of that acreage will rise over time.  Why will that be private, or corporate, gain, rather than public gain??

 

U.S. Government Sells 400,000 Acres in Gulf

By THE ASSOCIATED PRESS  AUG. 20, 2014

The federal government has sold more than 400,000 acres in the Gulf of Mexico off the Texas coast for oil and gas exploration and development, an official with the Bureau of Ocean Energy Management said Wednesday. The acreage represents a small fraction of the 21.6 million acres the agency had offered as part of a five-year program to develop resources on the outer continental shelf. Offerings since 2012 in the western Gulf attracted buyers for about 60 million offshore acres, adding about $2.3 billion to the Treasury. Wednesday’s sales, if approved, will bring in about $110 million. BP submitted the largest number of high bids, winning 27 of the 81 tracts that sold. It was the first sale in the western Gulf for BP since it was barred from such auctions after the 2010 oil spill. Conoco Philips spent the most of the 93 bidders in the sale, paying about $61 million for a tract in the ultra-deep-water Alaminos Canyon area.

Shiller: Too Many Graduating Seniors Go Into Finance

One might be led to ask, how many is enough, and how we might go about encouraging our best and brightest into careers that serve others instead of rent-seeking.  Two generations ago, many became doctors, engineers and teachers.  

• What changes in public policy will reduce the returns now funneled so generously to the rent-seekers, leaving more for the folks who labor in the productive sectors of the economy?  
• Why do we pay so little attention to rent-seeking?  
• Why is rent-seeking taught to our MBAs, but the impacts of rent-seeking not taught to our liberal arts, social sciences, political science, public policy students?   
• D'ya think that the rent-seekers might really really like it this way??

Shiller: Too Many Graduating Seniors Go Into Finance

http://www.moneynews.com/Economy/Shiller-financial-field-speculative/2013/09/25/id/527558

Too many of the our brightest people may be choosing careers in finance, undertaking economically and socially useless — and even harmful — activities, Robert Shiller, a Yale University economics professor, writes in an article for Project Syndicate.

A survey of elite U.S. universities showed that 25 percent of Harvard graduating seniors, 24 percent of Yale graduating seniors and 46 percent of Princeton graduating seniors were going into financial services in 2006, notes Shiller, co-creator of the Case-Shiller home price index. 

While those proportions have fallen more recently, he explains that might only be a temporary effect of the financial crisis.

And more are going into speculative fields like investment banking rather than traditional finance such as lending, he says, citing a study by Thomas Philippon of the Stern School of Business, New York University and Ariell Reshef of the University of Virginia. 

We need some traders and speculators, Shiller concedes, as they provide some useful service — sorting through information about businesses and trying to judge their real worth.

"But these people's activities also impose costs on the rest of us," he explains. Much of their speculation and deal making is "pure rent-seeking." 

"In other words, it is wasteful activity that achieves nothing more than enabling the collection of rents on items that might otherwise be free."

Those working in speculative finance fields are like a feudal lord installing a chain across a river to charge fees on passing boats, he argues. Making no improvements to the river, the lord does nothing productive and helps no one but himself. Few people will use the river if enough lords put chains across it to collect fees. 

Those working in speculative fields, he says, "skim the best business deals, creating a 'negative externality' on those who are not party to them."

For example, they can reject bad assets, such as subprime mortgage securities, offloading them to less knowledgeable investors. 

The repeal of the Glass-Steagall Act, which blocked commercial banks from investment banking, allowed bankers to act more and more like those feudal lords collecting fees.

"In fact, the main advantages of the original Glass-Steagall Act," he says, "may have been more sociological than technical, changing the business culture and environment in subtle ways. By keeping the deal-making business separate, banks may have focused more on their traditional core business."

A paper by economists at Columbia University and Princeton published on the Social Science Research Network website showed that over-the-counter (OTC) traders allowed informed dealers to extract excessive rents and to undermine organized exchanges by "cream-skimming" the best deals. 

"The informational rents in OTC markets in turn attract too much talent to the financial industry, which would be more efficiently deployed as real-sector entrepreneurs," the paper asserts.

Plus, OTC dealers' rents tend to increase "as there are more informed dealers, because the greater cream-skimming by dealers worsens the terms entrepreneurs can get for their assets on the organized exchange, and therefore their bargaining power on OTC markets."

Edgar Guest: Taxes

Taxes

By Edgar A. Guest

When they become due I don't like them at all.
Taxes look large be they ever so small
Taxes are debts which I venture to say,
No man or no woman is happy to pay.
I grumble about them, as most of us do.
For it seems that with taxes I never am through.

But when I reflect on the city I love,
With its sewers below and its pavements above,
And its schools and its parks where children may play,
I can see what I get for the money I pay,
And I say to myself: "Little joy would we know
If we kept all our money and spent it alone".

I couldn't build streets and I couldn't fight fire.
Policemen to guard us I never could hire.
A water department I couldn't maintain.
Instead of a city we'd still have a plain.
Then I look at the bill for the taxes they charge,
And I say to myself: "Well, that isn't so large".

I walk through a hospital thronged with the ill
And I find that it shrivels the size of my bill.
As in beauty and splendor my home city grows,
It is easy to see where my tax money goes.
And I say to myself: "If we lived hit and miss
And gave up our taxes, we couldn't do this".

Ethics of Piracy

I wonder if Morgan the Pirate,
   When plunder had glutted his heart,
Gave part of the junk from his ships he had sunk
   To help some Museum of Art; 
If he gave up the role of "collector of toll"
   And became a Collector of Art?

I wonder if Genghis the Butcher,
   When he'd trampled down nations like grass.
Retired with his share when he'd lost all his hair,
   And started a Sunday school class;
If he turned his past under and used half his plunder
   In running a Sunday school class?

I wonder if Roger the Rover,
   When millions in looting he made,
Built libraries grand on the jolly mainland
   To honor Success and "free trade;"
If he founded a college of natural knowledge
    Where Pirates could study their trade?

I wonder, I wonder, I wonder,
     If Pirates were ever the same,
Ever trying to lend a respectable trend
   To the jaunty old buccaneer game;
Or is it because of our Piracy Laws
    That philanthropists enter the game?

—Wallace Irwin, in Life. -- reprinted in The Painter and Decorator, a union journal, 1907

The Earth-for-All Calendar: Undecimber 14 -- Rousseau

He who eats in idleness what he himself has not earned, steals; and the landholder whom the State pays for doing nothing does not differ from a brigand who lives at the expense of travelers.

— Rousseau.

Shearman: The Distribution of Wealth, Part III (1887)

This, the third and final instalment, appeared in The Standard, October 22, 1887:

THE DISTRIBUTION OF WEALTH.

BY THOMAS G. SHEARMAN.

III

 

Having reached the conclusion that indirect, or as the writer first called it five years ago, "crooked" taxation is certain to produce enormous inequality of wealth, that it is palpably and indisputably unjust, and that it inevitably leads to that worst form of inequality which involves the perpetual ownership of more than half of the wealth of a country by less than the one-hundredth part of its inhabitants, we are prepared to take up the next and final question in our series. 

What can be done to effect a more equal distribution of wealth, without diminishing its production?

Again let us waive the discussion of rent. Having purposely avoided all consideration of that tender subject, we will not take it up just now. Assuming that rent can rightfully be private property, and that the community is not to claim it, simply as rent — conceding all that the champions of private property in land claim — let us inquire what, nevertheless, remains to be done and ought to be done, in order to prevent the unjust use of government to the injury of the poor, and to check the artificial tendency toward the monopoly of wealth by a hundredth part of the population.

Hugh Pentecost, on the connection between crime and poverty

This excerpt from an 1890 article in The Arena seems relevant as we look at gun violence and other contemporary problems created by lack of employment and income -- and hope.

It would be far better for society if instead of speculating on the forms of punishment we turned our attention to the means of preventing the crimes for which we punish the offenders. It has been observed that most of the murders occur among the poor people, and upon the top floors of tenement houses; that is to say, among the poorest of the poor. The connection between poverty and the crime of murder, like the connection between poverty and all other crime, is demonstrably close. If we could cure the social disease of poverty, the seeds of crime would be destroyed. The people rarely think of this. They think it is our business to punish crime; but it is our best business to prevent it. Our present organization of society manufactures criminals faster than we can possibly take care of them. Poverty degrades men; it robs them of leisure, which is absolutely necessary for the development of mind, and the proper control of the passions; it keeps the people hungry and fierce; it imbrutes them; it makes Ishmaels of them — their hand is against society as the hand of society is against them. Plant a generation of paupers, and you will reap a crop of criminals.

If we are wise we will turn our attention to the most important problem of this or any age: how to so enrich the people that the temptations to crime will be minified to the last possible degree. The solution of the problem is as simple as it is important. For every millionaire we shall have a thousand tramps; for every monopolist we shall have a hundred burglars; for every woman who lives in idleness upon the fruit of others’ toil, filched from them under the name of interest or rent, we shall have a score of prostitutes; for every vacant land owner and money limiter — the twin man-starvers — we shall have a murderer. One is the seed from which the other grows. Eliminate your monopolists, the king of whom is the owner of vacant land, and your problem of crime is settled. With open opportunities for men to apply their labor to natural wealth productions, tenfold more wealth would be produced and equitably distributed; and with wealth many times multiplied and equitably distributed, a criminal would be more of a curiosity than the original three-toed horse.

If memory serves, Hugh Pentecost was an Episcopal priest, perhaps in Newark.  The title of the article from which these paragraphs come is "The Crime of Capital Punishment."

I like the word "minified."  Maybe there is a useful slogan there: Minify Taxation!  ("To make smaller or less significant; reduce.") We could collect the revenue we need with lower taxes were we to concentrate our taxes on land value, in all its manifestations.  And in the process, we would reduce poverty, reduce the cost of living, reduce wealth concentration, reverse sprawl, naturally create employment and self-employment opportunities, and stabilize our economy.  It seems to me that any one of these goals is worthy, and if this reform would move us closer to any of these goals, it is worth pursuing.  

And, importantly, with less need to rely on a social safety net, spending could be signficantly reduced.

The Earth-for-All Calendar: December 30 -- Dove

If, then, successive generations of men cannot have their fractional share of the actual soil (including mines, etc.) how can the division of the advantages of the natural earth be effected? By the division of its annual value or rent; that is, by making the rent of the soil the common property of the nation. That is (as the taxation is the common property of the State), by taking the whole of the taxes out of the rents of the soil, and thereby abolishing all other kinds of taxation whatever. And thus all industry would be absolutely emancipated from every burden.

— PATRICK EDWARD DOVE, Theory of Human Progression (1850), Chap. III., Sec. 3.

The Community is Entitled ...

It is not proposed to confiscate any value that has been created by human industry. This would be robbery. But when the community creates wealth it is entitled to it as much as the individual is to the wealth he creates.

-- from the first issue of The Standard, 1/8/1887.

The Earth-for-All Calendar: December 20 -- Blackstone

The ground was in common and no part of it was the permanent property of any man in particular; yet whoever was in occupation of any determined spot of it, for rest, for shade or the like, acquired for the time a sort of ownership, from which it would have been unjust and contrary to the law of nature to have driven him by force; but the instant that he quitted the use or occupation of it another might seize it without injustice.

— SIR WILLIAM BLACKSTONE, Commentaries, Book II., Chap. I, p. 3.

That acre in Manhattan

An article in the NYT a few weeks ago described some proposed changes in the zoning for midtown Manhattan.

Bloomberg Pushes a Plan to Let Midtown Soar

The accompanying map says, "Around Grand Central Terminal, towers could be up to twice the size now permitted.  Development could also take place along the Park Avenue corridor, where towers could be more than 40% larger. Elsewhere in the district, towers could be 20% larger."

But New York’s premier district, the 70-block area around Grand Central Terminal, has lagged, Bloomberg officials say, hampered by zoning rules, decades old, that have limited the height of buildings.

Mayor Michael R. Bloomberg wants to overhaul these rules so that buildings in Midtown Manhattan can soar as high as those elsewhere. New towers could eventually cast shadows over landmarks across the area, including St. Patrick’s Cathedral and the Waldorf-Astoria Hotel. They could rise above the 59-story MetLife Building and even the 77-story Chrysler Building.

Mr. Bloomberg’s proposal reflects his effort to put his stamp on the city well after his tenure ends in December 2013. Moving swiftly, he wants the City Council to adopt the new zoning, for what is being called Midtown East, by October 2013, with the first permits for new buildings granted four years later.

His administration says that without the changes, the neighborhood around Grand Central will not retain its reputation as “the best business address in the world” because 300 of its roughly 400 buildings are more than 50 years old. These structures also lack the large column-free spaces, tall ceilings and environmental features now sought by corporate tenants.

The rezoning — from 39th Street to 57th Street on the East Side — would make it easier to demolish aging buildings in order to make way for state of-the-art towers.

Without it, “the top Class A tenants who have been attracted to the area in the past would begin to look elsewhere for space,” the administration says in its proposal.

The plan has stirred criticism from some urban planners, community boards and City Council members, who have contended that the mayor has acted hastily. They said they were concerned about the impact of taller towers in an already dense district where buildings, public spaces, streets, sidewalks and subways have long remained unchanged.

Mr. Bloomberg has encouraged high-rise development in industrial neighborhoods, including the Far West Side of Manhattan, the waterfront in Williamsburg, Brooklyn, and in Long Island City, Queens. But with the proposal for Midtown, which is working its way through environmental and public reviews, he is tackling the city’s commercial heart.

“Unlocking the development potential in this area will generate historic opportunities for investment in New York City,” Deputy Mayor Robert K. Steel said.

The initiative would, in some cases, allow developers to build towers twice the size now permitted in the Grand Central area. The owner of the 19-story Roosevelt Hotel at Madison and 45th Street could replace it with a 58-story tower under the proposed rules. Current regulations permit no more than 30 floors.

See also http://lvtfan.typepad.com/lvtfans_blog/2008/03/hotel-roosevelt.html , which discusses this in terms of value of land per buildable square foot.

When zoning changes increase the value of land, who should reap the benefit?  The current landholder, or the community?    What did the landholder do to earn that windfall?  Do you think it comes out of thin air?  Do you think it is paid him by other rich people?

Or do you recognize that it is part of the structure which enriches a few and impoverishes the many?

It is easy to fix this one.  One just has to recognize the structure, and value the land correctly, and start collecting the lion's share of the land rent for the community.  If it is more than NYC can put to use -- and it will be -- then apply the excess to reducing our federal taxes on productive effort.  Use it to fund Social Security, or Medicare, or universal health insurance, or something else that will benefit the vast majority of us instead of an undeserving tiny privileged minority.  Don't throw it in the ocean, and don't leave it in private pockets, be they American or not. 

Collect   the   land   rent.    Repeat next year, and the next, and the next.  Natural Public Revenue.

Chrystia Freeland: Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else

Chrystia Freeland: Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else.

Henry George is the most famous American popular economist you've never heard of, a 19th century cross between Michael Lewis, Howard Dean and Ron Paul. Progress and Poverty, George's most important book, sold three million copies and was translated into German, French, Dutch, Swedish, Danish, Spanish, Russian, Hungarian, Hebrew and Mandarin. During his lifetime, George was probably the third best-known American, eclipsed only by Thomas Edison and Mark Twain. He was admired by the foreign luminaries of the age, too -- Leo Tolstoy, Sun-Yat Sen and Albert Einstein, who wrote that "men like Henry George are unfortunately rare. One cannot image a more beautiful combination of intellectual keenness, artistic form and fervent love of justice." George Bernard Shaw described his own thinking about the political economy as a continuation of the ideas of George, whom he had once heard deliver a speech.

Later, she writes,

What George found most mysterious about the economic consequences of the industrial revolution was that its failure to deliver economic prosperity was not uniform -- instead it had created a winner-take-all society: "Some get an infinitely better and easier living, but others find it hard to get a living at all. The 'tramp' comes with the locomotives, and almshouses and prisons are as surely the marks of 'material progress' as are costly dwellings, rich warehouses and magnificent churches. Upon streets lighted with gas and patrolled by uniformed policeman, beggars wait for the passer-by, and in the shadow of college, and library, and museum, are gathering the more hideous Huns and fiercer Vandals of whom Macaulay prophesied."

George's diagnosis was beguilingly simple -- the fruits of innovation weren't widely shared because they were going to the landlords. This was a very American indictment of industrial capitalism: at a time when Marx was responding to Europe's version of progress and poverty with a wholesale denunciation of private property, George was an enthusiastic supporter of industry, free trade and a limited role for government. His culprits were the rentier rich, the landowners who profited hugely from industrialization and urbanization, but did not contribute to it.

George had such tremendous popular appeal because he addressed the obvious inequity of 19th century American capitalism without disavowing capitalism itself. George wasn't trying to build a communist utopia. His campaign promise was to rescue America from the clutches of the robber barons and to return it to "the democracy of Thomas Jefferson." That ideal -- as much Tea Party as Occupy Wall Street -- won support not only among working class voters and their leaders, like Samuel Gompers, but also resonated with many small businessmen. Robert Ingersoll, a Republican orator, attorney and intellectual, was a George supporter. He urged his fellow Republicans to back his man and thereby "show that their sympathies are not given to bankers, corporations and millionaires."

 

 

I commend the entire post, adapted from Freeland's new book, Plutocrats.  It ends with these paragraphs:

"America today urgently needs a 21st century Henry George -- a thinker who embraces the wealth-creating power of capitalism, but squarely faces the inequity of its current manifestation. That kind of thinking is missing on the right, which is still relying on Reagan-era trickle-down economics and hopes complaints about income inequality can be silenced with accusations of class war. But the left isn't doing much better either, preferring nostalgia for the high-wage, medium-skill manufacturing jobs of the post-war era and China-bashing to a serious and original effort to figure out how to make 21st century capitalism work for the middle class.

Globalization and the technology revolution aren't going away -- and thank goodness for that. Industrialization didn't go away either. But between 1886, when George lost the mayoral race, and the presidency of FDR, American progressives invented, fought for and implemented a broad range of new social and political institutions to make capitalism serve the whole of society -- ranging from trust-busting, to the income tax, to the welfare state.

We are living in an era of comparably tumultuous economic change. The great challenge of our time is to devise the new social and political institutions we need to make the new economy work for everyone. So far, that is a historic task neither party is taking on with enough energy, honesty or originality."

Those looking for a starting point might look for Walt Rybeck's book, Re-Solving the Economic Puzzle.

Along the same lines, you might find interesting an earlier post here, an article by Thomas Shearman entitled "Henry George's Mistakes."  (He was a co-founder of Shearman & Sterling, and went on to write some excellent articles on plutocracy in The Standard, October, 1887.)

Born Yesterday

Well, not quite.  The film's a little older than I am.

Watched that film last night ... great quote:

Billie: Because when ya steal from the government, you're stealing from yourself, ya dumb ass.

And when we allow others to steal from the commons what rightly belongs to the community, what are we?   Some of that theft we all recognize as theft, and other kinds are perfectly legal, even honored, under our current laws.  I find the latter even more troubling than the former.

And when neither our economists nor our leaders even SEE it, it is fair to call that a corruption of what their businesses are supposed to be.

 

The Earth-for-All Calendar: October 5 -- Spencer

Equity, therefore, does not permit property in land.  For if one portion of the earth's surface may justly become the possession of an individual and may be held by him for his sole use and benefit as a thing to which he has an exclusive right, then other portions of the earth's surface may be so held; and eventually the whole of the earth's surface may be so held; and our planet may thus lapse into private hands.

— HERBERT SPENCER, in 1850, Social Statics, Chap. IX.

The Earth-for-All Calendar: October 3 -- Marmontel

Let us suppose that a people is excluded from the ownership of the land.  I say that this exclusion, even if followed by no other injustice (which I think impossible), by making a man a stranger to the commonwealth, makes him indifferent to the existence of the State.

— MARMONTEL, Address in Favor of the Peasants of the North (1757), Oeuvres, Vol X., p. 72.

On Wages, from an 1887 weekly ... and relevant in 2012 America

"The wages problem resolves itself into a very simple question, viz.: Which is the better for a community — to have 10,000,000 men earning $2.50 a day, with hours that enable them to read and rest and pass a fair proportion of their time with their families, and at the same time have no millionaires, or to have those 10,000,000 men working fifteen hours a day at $1.50, and have a few score millionaires?"

This was a bit of end-of-column filler from the January 29, 1887, issue of Henry George's weekly newspaper, The Standard, and is attributed to The San Francisco Reporter. 

The Standard was devoted to issues like this, and makes excellent reading in this decade and century.

It might be worth noting that in those days when one spoke of a millionaire, the reference was to someone whose assets totalled over $1 million.  Today, it is commonly used to refer to someone whose annual income is over $1 million.  But you'll notice what workmen's wages were in 1887 -- $1.50 a day is $468 per year*, and likely didn't leave much, if anything, for savings. [6 days a week.]

So which IS better for the community?  The families making $1.50 or $2.50 a day are spending nearly every penny of that, just in order to get by.  The millionaires can only spend so much on the necessities of daily life, plus some generous amount on luxuries.  The rest they will invest, one way or another, and the wise ones, in our current structure, will "invest" in land -- particularly choice urban sites -- and natural resources, since we as a society are so generous about letting the owners of these assets keep most of what those assets earn, despite them having nothing to do with having created those assets, and being in no position to create more in response to demand, which will naturally increase with population!! 

THAT is the problem with our current "generosity."

The spending of the 10 million on the necessities of daily life creates jobs for a lot of other people.  (The portion that goes to their landlords in payment for the right to occupy bits of urban -- or other -- land, DOESN'T create any jobs; it simply enriches the landlord.  I don't begrudge the landlord the portion that relates to the building, or to services he provides, such as, say, a doorman in the city.)

 

The Earth-for-All Calendar: September 30 -- Exodus and the Bishop of Meath

The land which the Lord thy God giveth thee.

— Exodus, XX., 12.

Any settlement of the land of a country that would exclude the humblest man in that country from his share of the common inheritance would be not only an injustice and a wrong to that man, but moreover would be an impious resistance to the benevolent intentions of the Creator. 

— BISHOP OF MEATH, Letter to Clergy and Laity, April 2, 1881.

Stiglitz: "Mitt Romney’s Fair Share"

a few excerpts from: "Mitt Romney’s Fair Share" by Joseph E. Stiglitz | Project Syndicate.

A major theme of the underlying political debate in the United States is the role of the state and the need for collective action. The private sector, while central in a modern economy, cannot ensure its success alone. For example, the financial crisis that began in 2008 demonstrated the need for adequate regulation.

Moreover, beyond effective regulation (including ensuring a level playing field for competition), modern economies are founded on technological innovation, which in turn presupposes basic research funded by government. This is an example of a public good – things from which we all benefit, but that would be undersupplied (or not supplied at all) were we to rely on the private sector.

Conservative politicians in the US underestimate the importance of publicly provided education, technology, and infrastructure. Economies in which government provides these public goods perform far better than those in which it does not.

But public goods must be paid for, and it is imperative that everyone pays their fair share. While there may be disagreement about what that entails, those at the top of the income distribution who pay 15% of their reported income (money accruing in tax shelters in the Cayman Islands and other tax havens may not be reported to US authorities) clearly are not paying their fair share. ...

I have to disagree with the second sentence of this next paragraph.  And I think Stiglitz knows better, if he stops to think about it:

Democracies rely on a spirit of trust and cooperation in paying taxes. If every individual devoted as much energy and resources as the rich do to avoiding their fair share of taxes, the tax system either would collapse, or would have to be replaced by a far more intrusive and coercive scheme. Both alternatives are unacceptable. 

We don't need intrusive or coercive; we just need to start collecting the lion's share of the rent!  Well, I suppose some rent-seekers would find this extremely intrusive -- it intrudes on their habit of self-enrichment by privatizing of what is rightly and logically our PUBLIC treasure, the logical way of financing PUBLIC goods.   And Professor Stiglitz is quite aware of the value of natural resources; he may not be quite as conscious of the value of urban and other well-situated land.   

Our national recordkeeping doesn't even collect the valuations of land and natural resources on any consistent basis! (One could reasonably argue that this failure-to-measure is a form of corruption!)  What we don't measure we can't do anything about.  And the powers that be are quite content with how we do things; the benefits accrue to them!  And several generations of college-educated people know nothing about the issue, which was well known and widely discussed 100 years ago.  (Look into the extensive Single Tax literature and the ideas of Henry George.)

Some more excerpts:

The billionaire investor Warren Buffett argues that he should pay only the taxes that he must, but that there is something fundamentally wrong with a system that taxes his income at a lower rate than his secretary is required to pay. He is right. Romney might be forgiven were he to take a similar position. Indeed, it might be a Nixon-in-China moment: a wealthy politician at the pinnacle of power advocating higher taxes for the rich could change the course of history.

Comments

But Romney has not chosen to do so. He evidently does not recognize that a system that taxes speculation at a lower rate than hard work distorts the economy. Indeed, much of the money that accrues to those at the top is what economists call rents, which arise not from increasing the size of the economic pie, but from grabbing a larger slice of the existing pie.

Those at the top include a disproportionate number of monopolists who increase their income by restricting production and engaging in anti-competitive practices; CEOs who exploit deficiencies in corporate-governance laws to grab a larger share of corporate revenues for themselves (leaving less for workers); and bankers who have engaged in predatory lending and abusive credit-card practices (often targeting poor and middle-class households). It is perhaps no accident that rent-seeking and inequality have increased as top tax rates have fallen, regulations have been eviscerated, and enforcement of existing rules has been weakened: the opportunity and returns from rent-seeking have increased. 

Today, a deficiency of aggregate demand afflicts almost all advanced countries, leading to high unemployment, lower wages, greater inequality, and – coming full, vicious circle – constrained consumption. There is now a growing recognition of the link between inequality and economic instability and weakness.

There is another vicious circle: Economic inequality translates into political inequality, which in turn reinforces the former, including through a tax system that allows people like Romney – who insists that he has been subject to an income-tax rate of “at least 13%” for the last ten years – not to pay their fair share. The resulting economic inequality – a result of politics as much as market forces – contributes to today’s overall economic weakness. 

The Earth-for-All Calendar: September 2 -- Gerrit Smith and Thomas Paine

The vacant land belongs to the landless.  The simple fact that the one is vacant and the other landless is of itself the highest proof that they should be allowed to come together.  Alas, what a crime against nature that they should be kept apart.

— GERRIT SMITH, Smith's Speeches in the U. S. Congress, p. 247 (1854). 

The earth in its natural uncultivated state was, and ever would have continued to be, the common property of the human race.

—THOMAS PAINE, Agrarian Justice (1797),  Paine's Writings, Vol. III,, p. 329.

A Right-to-Life Platform -- 125 years old

As I listen to the 2012 party platforms, I am reminded of what they ought to be focused on, embodied pretty well in this platform from 1886-87. 

PLATFORM OF THE UNITED PARTY.
Adopted at Syracuse August 19, 1887.

We, the delegates of the united labor party of New York, in state convention assembled, hereby reassert, as the fundamental platform of the party, and the basis on which we ask the co-operation of citizens of other states, the following declaration or principles adopted on September 23, 1886, by the convention of trade and labor associations of the city of New York, that resulted in the formation of the united labor party.   

"Holding that the corruptions of government and the impoverishment of labor result from neglect of the self-evident truths proclaimed by the founders of this republic that all men are created equal and are endowed by their Creator with unalienable rights, we aim at the abolition of a system which compels men to pay their fellow creatures for the use of God’s gifts to all, and permits monopolizers to deprive labor of natural opportunities for employment, thus filling the land with tramps and paupers and bringing about an unnatural competition which tends to reduce wages to starvation rates and to make the wealth producer the industrial slave of those who grow rich by his toil.

'“Holding, moreover, that the advantages arising from social growth and improvement belong to society at large, we aim at the abolition of the system which makes such beneficent inventions as the railroad and telegraph a means for the oppression of the people and the aggrandizement of an aristocracy of wealth and power. We declare the true purpose of government to be the maintenance of that sacred right of property which gives to every one opportunity to employ his labor, and security that he shall enjoy its fruits; to prevent the strong from oppressing the weak, and the unscrupulous from robbing the honest; and to do for the equal benefit of all such things as can be better done by organized society than by individuals; and we aim at the abolition of all laws which give to any class of citizens advantages, either judicial, financial, industrial or political, that are not equally shared by all others."

We call upon all who seek the emancipation of labor, and who would make the American union and its component states democratic commonwealths of really free and independent citizens, to ignore all minor differences and join with us in organizing a great national party on this broad platform of natural rights and equal justice. We do not aim at securing any forced equality in the distribution of wealth. We do not propose that the state shall attempt to control production, conduct distribution, or in any wise interfere with the freedom of the individual to use his labor or capital in any way that may seem proper to him and that will not interfere with the equal rights of others. Nor do we propose that the state shall take possession of land and either work it or rent it out. What we propose is not the disturbing of any man in his holding or title, but by abolishing all taxes on industry or its products, to leave to the producer the full fruits of his exertion and by the taxation of land values, exclusive or improvements, to devote to the common use and benefit those values, which, arising not from the exertion of the individual, but from the growth of society, belong justly to the community as a whole. This increased taxation of land, not according to its area, but according to its value, must, while relieving the working farmer and small homestead owner of the undue burdens now imposed upon them, make it unprofitable to hold land for speculation, and thus throw open abundant opportunities for the employment of labor and the building up of homes.

While thus simplifying government by doing away with the horde of officials required by the present system of taxation and with its incentives to fraud and corruption, we would further promote the common weal and further secure the equal rights of all, by placing under public control such agencies as are in their nature monopolies: We would have our municipalities supply their inhabitants with water, light and heat; we would have the general government issue all money, without the intervention of banks; we would add a postal telegraph system and postal savings banks to the postal service, and would assume public control and ownership of those iron roads which have become the highways of modern commerce.

While declaring the foregoing to be the fundamental principles and aims of the united labor party, and while conscious that no reform can give effectual and permanent relief to labor that does not involve the legal recognition of equal rights, to natural opportunities, we nevertheless, as measures of relief from some of the evil effects of ignoring those rights, favor such legislation as may tend to reduce the hours of labor, to prevent the employment of children of tender years, to avoid the competition of convict labor with honest industry, to secure the sanitary inspection of tenements, factories and mines, and to put an end to the abuse of conspiracy laws.

We desire also to so simplify the procedure of our courts and diminish the expense of legal proceedings, that the poor may be placed on an equality with the rich and the long delays winch now result in scandalous miscarriages of justice may be prevented.

And since the ballot is the only means by which in our Republic the redress of political and social grievances is to besought, we especially and emphatically declare for the adoption of what is known as the “Australian system of voting,” an order that the effectual secrecy of the ballot and the relief of candidates for public office from the heavy expenses now imposed upon them, may prevent bribery and intimidation, do away with practical discriminations in favor of the rich and unscrupulous, and lessen the pernicious influence of money in politics.

In support or these aims we solicit the co-operation of all patriotic citizens who, sick of the degradation of politics, desire by constitutional methods to establish justice, to preserve liberty, to extend the spirit of fraternity, and to elevate humanity.

Bankrupt in California

Has no one in California figured out that when the calf is deprived of mother's milk, starvation is inevitable?

It has taken 34 years, but it is coming about.

Feeding calves grain, or seaweed, or sunflower seeds isn't as smart as letting it consume its natural food.

Taxing wages, sales and buildings isn't as smart as collecting the lion's share -- calf's share, if you will -- of the land rent for public purposes.

Proposition 13 was designed to make sure that the cows' milk was kept for the Irvines, the big landowners, the commercial property owners, and the longtime homeowners, while providing a diminishing fifth of it to the calf and supplementing with grain, seaweed and sunflower seeds.

The calf's digestive system has blown up because it was deprived of its proper food, and "nourished" with stolen fake food.

 

1886 and 2012 -- what has changed?

"Our progressive and scheming civilization has developed new forms of speculation and new organizations to give power to capital. Corporations have already become more formidable than the government. Law has clothed them with artificial power without placing proper restriction on its selfish and unjust exercise. There is not adequate security against the frauds they perpetrate. Aggregated capital is managed by boards of directors or trustees whose first business is to advance their own individual interests, and then, so far as consistent with it, the interests of the stockholders."

William Phillips: Labor, Land and Law: A Search for the Missing Wealth of the Working Poor (1886), p. 23

 

The Rent of Land, and Government Expense

"The rent of land and government expenses are both caused by population. Let one pay the other."

--Henry Chase, M. D.

Resource Rentals for Revenue -- The 3 R's of fixing our economy

I came across an excellent site at http://www.resourcerentalsrevenue.org, and thought their FAQ page particularly worth sharing.   The links will take you to answers.

We don't HAVE to burden ourselves and our economy with taxes which throw a wet blanket on jobs, on production, on homes.  There is a better way to finance our common spending!

Resource Rentals for Revenue.

The following list comprises the most commonly asked questions about the concept of making land and resource rentals the source of revenue for government. As you continue this study, you will see the value from giving resources the respect they deserve and the benefits resulting from the freeing of labour, production and exchange from taxation. If you have any questions which are not covered here, or observations you would like to put to our panel, please feel free to do so by sending your question as an e-mail query and we will attempt to respond.

The inclusion of land and resources in the economic equation is central to any solution for revenue raising. A taxation solution which does not consider the nature of taxation itself and allows the continuing private monopolisation of community land and resources fails to recognise the essential role land plays in the economic equation and will not work. Land is the only element in the economic equation which is both fixed and finite. It can be monopolised. It is a unique class of asset which must be treated accordingly. If we were to wrest not the land itself, but its unimproved value from private monopolies and return the value to the community — whose very presence creates it — then we would have reduced many problems in one stroke with great benefit to production, to the environment and to the cause of individual freedom and justice.

On the subject of land and resource rents, Henry George said this:

The tax upon land values is the most just and equal of all taxes. It falls upon those who receive from society a peculiar and valuable benefit, and upon them in proportion to the benefit they receive. It is the taking by the community, for the use of the community, of that value which is the creation of the community. It is the application of the common property to common uses. When all rent is taken by taxation for the needs of the community, then will the equality ordained by nature be attained.

1.Understandings

• What’s with all the terminology?
• Won’t the site rent be passed on to the tenant?
• It sounds too simple
• What is the difference between Land Value and Land Price?
• What is meant by ‘unimproved’ value?
• Why is income from land ‘unearned’ income?
• There is no such thing as a free lunch.
• There is no unimproved land value!
• This tax, like a debits tax, ignores two of the basic principles of raising tax
• It’s incorrect to suggest that income derived from holding land or resources out of use is not a productive activity. It is, since it produces income for the owner.

2.Interest Groups

• Will I be better off with Resource Rentals?
• Are resource rentals fair?
• Wouldn’t the wealthy simply find some way of evading it?
• Wouldn’t the wealthy sell up and flee with their wealth?
• Won’t the poor get caught, while the rich escape as usual?
• Would farmers be able to afford the tax?
• How will it affect multinationals (MNC’s)?
• How will it affect lenders and borrowers?
• Entrepreneurs and Manufacturers?
• Exporters and Importers?
• Environmentalists?
• Won’t it fall harder on the prince in his mansion than on the pauper in his hovel?
• How would old age pensioners on valuable sites be able to pay the site rent as suggested?
• What happens to the self-funded or partly self-funded retiree?
• Unemployed adults - currently untaxed but perhaps owning their own home? Will they have to pay as well?
• The investor in a site has taken a risk, and tied up their capital – who else could possibly be entitled to their capital gain?

3.Implementation

• How would such a system be implemented?
• What would happen to Land Prices?
• If resource rentals are such a good idea, why don’t we have them?
• Why would anyone want to own land under this system?
• How do I buy a property?
• If site values fall, won’t revenue fall too?
• How will it curb unemployment?
• Wouldn’t we run out of space?
• Who wins; who loses?
• Will pensioners and retirees - currently untaxed but living in their own property, be liable for site rents? Will they be reimbursed for past taxes paid?
• New enterprises - yet to realise any profit but paying tax on the property from which they operate? If you tax them, won’t they fail?
• Why don’t we impose reciprocal import duties?
• What about anti-pollution tax rebates?
• What about a Debits Tax?
• Site Rent for Revenue is a crackpot idea.
• Why put the entire burden of taxation on one area of economic activity?

Good questions -- and good answers!

The Earth-for-All Calendar: June 13 -- Paine and Marmontel

Landed monopoly has dispossessed more than half the inhabitants of every nation of their natural inheritance.

— THOMAS PAINE, Agrarian Justice, Paine's Writings, Vol. III., p. 331.

In the country the more rich people there are, the less wealth there is.

— MARMONTEL, Address in Favor of the Peasants of the North (1757), Oeuvres, Vol. X., p. 70.

The Earth-for-All Calendar: April 23 -- Simon Newcomb

It is well known that these materials and agencies, as fast as they become available, are in the main appropriated by individuals, through the agency or consent of the government, and are then held as private property. Such is the case with the soil and the minerals beneath it. The owners of this property charge as much for the use of it as if it were their own creation, and not that of nature.

— PROF. SIMON NEWCOMB, The Labor Question, North American Review, July, 1870, p. 151.

a link and a longer except follow ...

 

The Earth-for-All Calendar: April 13 -- Jefferson

Wherever there is in any country uncultivated lands and unemployed poor, it is clear that the laws of property have been so far extended as to violate natural right. The earth is given as a common stock for man to labour and live on.

— THOMAS JEFFERSON (1785), Ford's Writings of Jefferson, Vol. VII., 36.

The Earth-for-All Calendar: April 1: Queen Elizabeth's Prayerbook

Thou, O Lord, providest enough for all men with Thy most liberal and bountiful hand, but whereas Thy gifts are, in respect of Thy goodness and free favour, made common to all men, we (through our naughtiness, niggardship and distrust), do make them private and peculiar. Correct Thou the thing which our inequity hath put out of order, and let Thy goodness supply that which our niggardliness hath plucked away.

— A Prayer for Them That Be in Poverty, from Queen Elizabeth's Private Prayer Book (1578).

The Earth-for-All Calendar: March 31 -- Adam Smith

A tax upon ground-rents would not raise the rent of houses. It would fall altogether upon the owner of the ground-rent, who acts always as a monopolist and exacts the greatest rent which can be got for the use of the ground.

— ADAM SMITH, Wealth of Nations (1776), Book V., Chap. 2, Art. I.

The Earth-for-All Calendar: March 30 -- Emperor Joseph II

Land, which nature has destined to man's sustenance, is the only source from which everything comes, and to which everything flows back, and the existence of which constantly remains in spite of all changes. From this unmistakable truth it results that land alone can furnish the wants of the state, and that in natural fairness no distinctions can be made in this.

— EMPEROR JOSEPH II., in Oestreichische Geschichte fur das Volk, Vol. XIV. (Vienna, 1867).

The Earth-for-All Calendar: March 27 -- Paine and Penn

Every proprietor, therefore, of cultivated land owes to the community a ground rent (for I know of no better term to express the idea) for the land which he holds.

— THOMAS PAINE, Agrarian Justice, Paine's Writings, Vol. III., p. 329 (1795-6).

If all men were so far tenants to the public that the superfluities of gain and expense were applied to the exigencies thereof, it would put an end to taxes, leave never a beggar and make the greatest bank for national trade in Europe.

— WILLIAM PENN, Reflections and Maxims, Sec. 222, Works V., pp. 190-1.

Developer Inks 99-Year Lease

The remarkable thing about this story, to my eye, is that the size of the lot isn't even mentioned!  It is worth $1 million land rent per year, and one might infer from the information provided that the lot is about 10,000 square feet, or less than 1/4 acre.

Capitalized at 5% (also known as "20 years' purchase") the lot would sell for about $20 million.

I assume that in addition to the land rent, the tenant pays the property tax on the land.  So the entire $1 million annual land rent flows out of NYC, to the property's owner, in Marshall, Virginia.

What, pray tell, has the land owner done to earn that land rent? 

Consider how many people's wage taxes and sales taxes could be lifted, and what that additional spending power could do for the local economy.  Consider what would happen if there were no taxes to be paid on the apartments or on people's condo structures.  

Or NYC can just keep letting the land rent leave the city, and even leave the country, continuing to flow into private pockets, just as if they'd rendered someone some service and earned it!

Land rent is natural public revenue, and we permit landlords to privatize it.  Aren't we generous with our patrimony?  (Leona told us the truth!)

Karl Fischer | Developer Inks 99-Year Lease | East Village.

The developer of a nine-story Karl Fischer rental apartment building planned for a corner site in the East Village signed a 99-year ground lease that requires payments each year of about $1 million.

The development company, YYY Third Avenue, signed the long-term lease for the vacant site at 74-84 Third Avenue, at 12th Street, April 27, 2011, however, a memorandum of the lease was not recorded in public records until last Wednesday, city property documents show.

A source citing city property records said the lease payment, which is not specifically recorded, could be inferred to be about $1 million per year. Prior to the document’s release, the annual lease cost was not known.

The prolific and controversial architect Fischer filed plans to build an 82,000-square-foot, nine-story residential building with 94 units, city Department of Buildings online records show. The permit has not been approved and is pending, DOB data indicate, and is to include nearly 9,511 square feet of retail, as well.

You might also be intrigued by the URL for the story ... I'm not sure what to make of it.

The Earth-for-All Calendar: March 23 - Voltaire

Each individual owns that part of the national territory and revenue which the laws secure to him, and no possession or enjoyment can at any time be withdrawn from the operation of the law.

— VOLTAIRE, Dictionnaire Philosophique, tit. Droit Canonique, Sec. 2,

Oeuvres, Vol. LIV., p. 138.

The Land Questions: #40: promoting urban housing for all who want it

40. Studies have confirmed the common wisdom that people who live in cities do more walking than those who live in suburban and rural areas, and tend to be in better shape.   What economic policies might help promote the kind of density that will encourage the development of affordable housing -- for people all across the income spectrum -- near the centers of activity?

A. Land value taxation, which will cause urban landholders to put their underused land to better use, replacing vacant lots and obsolete buildings with taller modern buildings, approaching the highest and best use for that land.

B. Land value taxation, which will capture the increases in value that are the result of public investment in new transportation systems: subway stops, bus stops, etc., instead of leaving it to raise the selling price of sites served.

C. Land value taxation, which produces the kind of density that makes public transportation systems feasible.

D. Land value taxation, which will allow people who would like to live closer to their work to afford housing there

E. LVT, which will bring down the selling price of land -- without reducing its value at all -- to make it appealing to developers who can put it to use

F. LVT, which will allow people to afford housing with smaller and shorter mortgages to live where they want to live.

G. Your suggestions?

The Earth-for-All Calendar: March 22 -- Sheldon Amos and Marmontel

The relation of a state to its territory, which in modern times enters into the essential conception of the state, implies that the land cannot be looked upon, even provisionally, as a true subject of permanent individual appropriation.

— PROF. SHELDON AMOS, Science of Law, Chap. VIII., p. 166 (1874)

 

Property in land is always conditional. Land is the source of the life of the state, and the state must exist at any cost.

— MARMONTEL, Address in Favor of the Peasants of the North (1757),

Oeuvres, Vol. X., p. 92.

The Land Questions: #38: Mining

38. Mining companies which mine on public lands pay far less to the Federal government than they pay on privately held lands. 

A.  That's fair, because the private landholders are better negotiators

B. That's fair, because the 1872 Mining Act set the price, and it wouldn't be fair to change the business environment after setting the rules.

C. That's fair.  Corporations need subsidies to create jobs.

D. That's unfair, and the federal government should be getting just as much from the miners as the private landholders are getting

E. That's unfair, and not only should the federal government be getting more from the mining companies, but the federal government should be collecting a significant portion of the royalties now privatized by private and corporate landholders, since we're all equally entitled to nature's bounty.  This would permit us to reduce other taxes on wages and production, and perhaps lead to a citizen's dividend, similar to the Alaska Permanent Fund

F. That's unfair, because the 1872 Mining Act was based on old prices and old mining technology.

G. Your reactions?

 

The Land Questions: #37

37.  Our ancestors bought or stole the land which the ancestors of some of those now identified as "Native Americans" relied on.  How should we and our children pay back them and their children?

A. By giving them the privilege of selling cigarettes without taxes, forgoing revenue that could help meet the health costs associated with smoking, both for smokers and for those who live with them.

B. By giving them the privilege of running casinos, even if a percentage of that revenue must be contributed to the state, and even if gambling is creates tremendous problems for some individuals in society, beyond those who actually gamble.

C. By collecting from everyone who owns land and natural resources the annual economic value, and giving everyone a per-capita share of those resources, every year, forever.  (Similar to the Alaska Permanent Fund)

D.  By collecting from everyone who owns land and natural resources the annual economic value, and giving everyone a per-capita share of those resources, every year, forever, and providing a double share to those who are starting from a disadvantaged position for some fixed number of years

E. By collecting from everyone who owns land and natural resources the annual economic value, paying the costs of government and common spending from that source, producing equal opportunity for all.

F. Your suggestions?

 

The Land Questions: #30 -- Public Lands

30. What should we do with our public lands?

A. Sell them off at the current price, about $5 per acre, per the 1872 Mining Act, even if they contain minerals worth billions of dollars.

B. Sell them off to the highest bidder, as soon as possible

C. Sell them off to any bidder, as soon as possible

D. Lease them for fixed terms, to the highest bidder, with future lease prices to be calculated with an eye to making it profitable for the tenant

E.  Lease them for fixed terms, to the highest bidder, and then repeat the auction in 10 years. Maintain extensive online databases so that the lease descriptions are visible to all, and the lease expirations are well advertised to all who might be interested in bidding.  Make it the landlord's business to get high quality unbiased appraisals of tenant improvements, so that tenants can make sensible improvements and be secure in them.  Use the revenue to reduce other taxes which burden the economy.

F. Lease them out, at market rates, with the proceeds used to generated a citizen's dividend.  If there is a monopoly or oligopoly, break it up so that there is a genuine market.

G. Keep renting them out at whatever price they're now receiving; we don't want to upset anyone's plans or privileges.

H. Your suggestions?

The Land Questions: #29 -- Selling the Toll Roads

29. The states need money.  Should they sell their toll roads to private companies? 

A. Sure!  That would provide a nice pot of money that would help with this year's budget and next year's, and after that, we can leave the problem to a future group of legislators and a new governor!

B. Sure! The private sector will take better care of them and turn a profit to boot!

C. No.  The taxpayers paid for those roads to be built, and have a right to more control over them than would exist after privatization.

D. No. The taxpayers own that land, a unique right of way, and selling it off forever is irresponsible and wrong!

E. No. Our society -- any society -- is highly dependent on our infrastructure, and control over it must remain in the public sector.

F. No. Those highways are built on land that was bought or taken from individual property owners for the public good.  To turn them over to the private sector, for profit, would be wrong.

G.  No.  Those highways will increase in value over the coming decades and centuries, and should not become anyone's private property, at any price.  Both their economic value and the control over them belongs in the common sector.

H. No.  Even if it looks as if it might make sense for our generation, what of future generations?  Should we permit the privatization of a common asset they will likely be dependent on?

I. No. Future taxpayers will build more highways intersecting with these current tollroads, and increase their value; were these to be privatized, it would be the private corporation who would reap the benefit of that future public investment.

J. Your suggestions?

The Land Questions: #27 -- Financing a New Subway Line

27. A new subway line costs $2 billion.  Suppose that its construction increases the surrounding land values by $2 billion. (Assume 5 miles long, 10 stations, 0.5 mile radius, average lot size of 0.10 acre.   How should the new subway line be financed?

A. Taxes on sales of groceries, clothing, etc. within those 1/2 mile radius areas

B. Taxes on sales of groceries, clothing, etc., all over the city the subway line connects to

C. Taxes on sales of services within those 1/2 mile radius areas

D. Taxes on sales of services of all kinds, all over the city the subway line connects to

E. Taxes on wages of those working in those 1/2 mile radius areas

F. Taxes on wages all over the city the subway line connects to

G. Taxes on wages of those living within the 1/2 mile radius areas

H. Taxes on capital gains and dividends of those living within the 1/2 mile radius areas

I. Taxes on capital gains and dividends of those with residence anywhere in the city

J. Taxes on all real estate within those 1/2 mile radius areas

K. Taxes on all real estate, all over the city the subway line connects to

L. Taxes on just the buildings within those 1/2 mile radius areas

M. Taxes on all the buildings, all over the city the subway line connects to

N. Taxes on the land value within those 1/2 mile radius areas

O. Taxes on the land value, all over the city the subway line connects to

P. Transfer taxes on either or both of buyers and sellers whenever a property within the 1/2 mile radius is sold

Q. Transfer taxes on either or both of buyers and sellers whenever a property anywhere within the city is sold

R. An inheritance tax when a house or commercial property is transferred from a decedent to a survivor.

S. Your suggestions?

 

The value of land is the day-to-day product of the community

The taxation of all property at a uniform rate is made necessary by the constitutions of about three-fourths of the States of the Union. The taxes on chattels, tools, implements, money, credits, etc., find their condemnation from the Single Taxer's point of view in those ethical considerations which differentiate private from public property. Where there arises a fund known as "land values," growing with the growth of the community and the need of public improvements, it is not only impolitic, it is a violation of the rights of property to tax individual earnings for public expenses.

The value of land is the day-to-day product of the presence and communal activity of the people. It is not a creation of the title-holder and should not be placed in the category of property. If population deserts a town or portions of a town, the value of land will fall; the land may become unsalable. When treated as private property the owner of land receives from day-to-day in ground rent a gift from the community; and justice requires that he should pay taxes to the community proportionate to that gift.

"Land value" or "ground rent" as the older economists termed it, is a tribute which economic law levies upon every occupant of land, however fleeting his stay, as the market price of all the advantages, natural and social, appertaining to that land, including necessarily his just share of the cost of government.

excerpt from The Single Tax Year Book (1917)

The Land Questions: #20 Affordable Housing

20. What is the best way to insure that affordable housing -- for people of all ages and stages, all income levels -- is available, both for ownership and for rental, both near the center of activities and, if needed after the desire for housing near the center of activities is satisfied, on the fringes?

A. Lotteries

B. Community Land Trusts

C. Affordable Housing Regulations that require that for every 10 new condos built, 1 must be affordable to people earning less than the local median household income

D. Rent control

E. Shame

F. Fundraisers

G. Habitat for Humanity

H. Relaxed mortgage lending rules and more private mortgage insurance

I. Land value taxation, to encourage the redevelopment of underused sites near the center of things

J. Your suggestions?

A 1938 NYT Letter to the Editor: Collecting Ground Rent

I came across this rather good letter to the editor, from 1938.  (Trinity Church Corporation, a major landlord in downtown Manhattan, was the subject of a NYT article this past week, as well as the subject of a major series in the NYT in December, 1894):

1938-09-03 Letters to The Times

Collecting Ground Rent
Single-Tax System Regarded as No Detriment to Building

TO THE EDITOR OF THE NEW YORK TIMES:

Fabian Franklin, in his letter to THE TIMES discussing the demolition of John D. Rockefeller's Harlem tenements in order to save taxes, writes:

"That objection is simply that virtual abolition of land ownership, which the single-tax plan is designed to effect, would make the building of houses in a city an extra-hazardous business, because, under the single-tax regime, in the great majority of cases the investment would result in a disastrous loss to the owner of the building.  I was neither blaming nor praising Mr. Rockefeller for the demolition of Harlem tenements."

What is the so-called single-tax system?  It is the collection by the government, through the taxing officials, of the entire economic or ground rent of land and the repeal of all taxes on buildings and other products of labor and capital.  That ground rent is estimated to be 9% of the capital value of the land.  New York City is now collecting one-third of this ground rent.  The market value of the lots is the remaining two-thirds, capitalized.  Dr. Franklin's thesis is that if the entire ground rent is collected no one would erect buildings, because "in the great majority of cases the investment would result in a disastrous loss to the owner of the building."

Some of the finest buildings in New York City are erected on leased land and the lessee pays the ground rent 100% besides a tax on the building.  There are hundreds of buildings erected by lessees of lots owned by Trinity Church, Astor estate, Rhinelander estate, Sailors Snug Harbor and others.  The lessees must pay all the taxes, both on land and building, amounting to 3% of the assessed value of both, and to the landlord 6% of the market value of the land.

Thus the entire ground rent is paid by the lessee, but only one-third to the government representing the people who made that value by their presence and activities, the remaining two-thirds to the landlord.  Notwithstanding that they are thus obliged to pay 100% of the economic rent, bankers and business men erect buildings costing millions.  Under the Henry George plan they would have to pay less, for the taxes on these costly structures will have been repealed.

Perhaps if Mr. Rockefeller had not been obliged to pay taxes on the buildings he might not have pulled them down; or, if he had, would have erected better buildings in their place in order to get a return on his investment in buildings.  The ones who will benefit most from the adoption of the Georgian philosophy are the owners of humble homes.  The average small homeowner's house is assessed for at least twice the assessed value of the lot.  If the house is relieved from taxation and the lot taxed the entire ground rent, his tax will be less than it is now.  The difference will be made up from vacant lots and lots that are worth more than the improvements.

After all, the building of houses is like any other business.  The builder takes the risk of lessened demand because of changes in fashion, obsolescence, competition.  It is estimated that 95% of new businesses ultimately fail. With the adoption, however, of the philosophy of Henry George, commonly called the single tax, failures in the housing and other businesses will be much fewer.  This is because neither houses nor goods nor anything else will be taxed.  The collection of the entire ground rent will not lessen the area of the surface of the earth one inch.  On the contrary, it will open to occupation and use land that is now held for speculation purposes. 

The taxation of any product of labor and capital will add the amount of the tax to the price, lessen demand and thus curtail production.  The result is unemployment and misery.

Frederic Cyrus Leubuscher
Essex Fells, N. J., Aug. 31, 1938

NYT Invitation to a Dialogue - A National Service Program

Invitation to a Dialogue - A National Service Program - NYTimes.com Published: February 14, 2012

To the Editor:

David Brooks suggested in a recent column that the country needs a national service program to unite the diverging classes in society. He’s right.

Not long ago, we had one that did so very well. It was the draft. Every young man — regrettably, only men — shared a potential obligation to his country.

Any serious discussion of comprehensive national service means talking about a draft. It’s hard to imagine the Supreme Court upholding nondefense conscription, but if civilian service were an alternative to military duty, the prospects would improve.

The all-volunteer military is exemplary for its professionalism, sacrifice, meritocracy and diversity. (I have a son with two college degrees who enlisted.) But the benefits and burdens need to be shared more widely. There have been too many multiple deployments of regulars and reserves, and if draftees were in the mix once again, perhaps there would be no more wars of choice.

Many domestic needs could be served by a comprehensive national service program. Like the Depression’s best idea, the Civilian Conservation Corps, it could involve people from all classes in repairing our parks, roads, bridges and other infrastructure. It could also bring fresh ideas and talent to teaching, law enforcement, social work and other underpaid public services. The benefits to our national character, as Mr. Brooks suggests, would be immense.

There are past and present models of a national service program in more than a dozen other nations. It is time we gave it a try.

MARTIN A. DYCKMAN
Waynesville, N.C., Feb. 14, 2012
The writer is a retired associate editor and columnist for The St. Petersburg Times.

Editors’ Note: We invite readers to respond to this letter for our Sunday Dialogue. We plan to publish responses and Mr. Dyckman’s rejoinder in the Sunday Review. E-mail: [email protected]

LVTfan's observation: Every investment in improved infrastructure creates land value.   Most projects that have value -- education, law enforcement, social work, improved public health -- will also increase land value.

A project is, by definition, worthwhile if it creates more in land value than it costs to do,* and, it could be argued that, when comparing two infrastructure projects that cost the same amount, say, $100 million, if one creates $200 million in land value and the other creates merely $150 million in incremental land value, the $200 million project should probably take priority, all other things being equal.

*which isn't to say that many public spending projects which don't create increased land value aren't worthwhile, too, for other reasons.

These projects, some will say, fall into the category of "pork" spending.

Pork barrel is the appropriation of government spending for localized projects secured solely or primarily to bring money to a representative's district. The usage originated in American English.^[1] In election campaigns, the term is used in derogatory fashion to attack opponents. Scholars, however, use it as a technical term regarding legislative control of local appropriations.^[2]

History

The term pork barrel politics usually refers to spending that is intended to benefit constituents of a politician in return for their political support, either in the form of campaign contributions or votes. In the popular 1863 story "The Children of the Public", Edward Everett Hale used the term pork barrel as a homely metaphor for any form of public spending to the citizenry.^[3] After the American Civil War, however, the term came to be used in a derogatory sense. The Oxford English Dictionary dates the modern sense of the term from 1873.^[4] By the 1870s, references to "pork" were common in Congress, and the term was further popularized by a 1919 article by Chester Collins Maxey in the National Municipal Review, which reported on certain legislative acts known to members of Congress as "pork barrel bills". He claimed that the phrase originated in a pre-Civil War practice of giving slaves a barrel of salt pork as a reward and requiring them to compete among themselves to get their share of the handout.^[5] More generally, a barrel of salt pork was a common larder item in 19th century households, and could be used as a measure of the family's financial well-being. For example, in his 1845 novel The Chainbearer, James Fenimore Cooper wrote, "I hold a family to be in a desperate way, when the mother can see the bottom of the pork barrel."^[6]

Definition

Typically, "pork" involves funding for government programs whose economic or service benefits are concentrated in a particular area but whose costs are spread among all taxpayers. Public works projects, certain national defense spending projects, and agricultural subsidies are the most commonly cited examples.

Citizens Against Government Waste^[7] outlines seven criteria by which spending can be classified as "pork":

1.  
   1. Requested by only one chamber of Congress;
   2. Not specifically authorized;
   3. Not competitively awarded;
   4. Not requested by the President;
   5. Greatly exceeds the President’s budget request or the previous year’s funding;
   6. Not the subject of congressional hearings; or
   7. Serves only a local or special interest.

The last of these seems as if it might be the most important one.

So here's the question: How should we finance these projects, if they are to be done?  How would we pay for a modern CCC? (Ah -- this sounds like The Land Questions ...)

A.  By a local tax on land value.  This would necessitate regular reassessment of the land value in every community in America, say, every 3 years, which could be done for well under $40 per parcel.  It would probably also require some state and/or federal oversight, checking values against transactions to verify that all municipalities or assessing units are doing high-quality market-based assessments. [In Maryland, they're already doing assessments every 3 years.  In Connecticut, assessments every 4 years are required.  In southern Delaware, the assessments are 30+ years old.  In California, the assessments are meaningless, due to Proposition 13.  It would take a few years for some of these entities to update their assessments.]

B. By a state tax on land value. [same issues apply]

C. By a national tax on land value.

D. Let's just use the federal income tax.  It's there.  It's easy.

E. Let's use a national sales tax.

F. Let's use a tax on imports.

G. Let's tax buildings.

H. Let's tax services.

It seems to me that a national service corps of some sort has a lot of merit.  It could promote a lot of highly desirable goals.  It could provide a lot of home-front protection in the event of natural disasters.  It could get some important projects done, including the maintenance of existing infrastructure currently under-maintained,and the provision of services we believe are important (particularly when we are the beneficiaries).

But the financial benefits ought not to fall into private or corporate pockets; they ought to accrue to all of us, and ease the burdens of financing other kinds of federal spending.  Land value taxation strikes me as the answer to so many of our supposedly intractible problems.

 

 

The Land Questions: #13 -- Electric Utilities

13. Electric utilities have long been regarded as "widows' and orphans'" stocks.  Safe, if not high income.  A few years ago, they were deregulated.  A recent study has shown that retail electricity prices have increased faster in states that adopted competitive pricing than in those where rates continue to be set by government agencies.  We all need reliable electricity.  Should we permit the licenses to generate and distribute electricity to be an opportunity to make a windfall profit?  (Or should we encourage municipal ownership of vital utilities?)

A.  Sure!  People and businesses are quite free to move from states without regulation to states with regulation if they choose.  They may not mind paying 20% more for their electricity, if other conditions are good. And didn't the utilities earn it?

B. Sure.  If local regulatory agencies decide that local best interests conflict with the interests of the corporate shareholders, they can re-regulate.  After all, the corporations don't vote.

C. No. Electricity is important and we ought to do what we can to keep the price down so that poor people can afford electricity and still have funds for other costs of living.

D. No.  Electricity is vital to the economy, and we ought to do what we can to keep it affordable to ordinary people, and not a source of corporate windfalls.

E. No.  Natural monopolies ought to be publicly owned, the prices kept low, and any excess revenue accrue to the public treasury, not to the benefit of private investors.

F. your suggestions?

 

The Land Questions: #12 -- Water Utilities

12.   Foreign corporations own the water utilities in parts of New England.  Often these companies came with significant acreage on picturesque reservoirs, some within easy commuting distance of New York City.  Water is a vital resource, and the infrastructure which supplies it and cleans it is vital to everyone.   In other places, including NYC, municipal utilities supply the water.   Is private ownership of the water supply acceptable?

A. Sure!  Why not?

B. As long as it is regulated by stong public utility commissions

C. No, this should be a public function.

D. Private ownership is fine, as long as it is American corporations.  They'll take care of us, and not overcharge us.

E. This is a natural monopoly situation, and rightly should be owned by the local, county or state government, or some local public entity.  Clean water is too important to leave to the private sector, even where the supply is abundant.

F.  Your suggestions?