This Forum is Closed

The Economy => Taxation => Topic started by: Geolibertarian on August 23, 2010, 03:56:15 pm

Title: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on August 23, 2010, 03:56:15 pm
For those unfamiliar with the issue of land value taxation, please see the following two introductory articles:

------------------------------------ (

What is Land Value Taxation [LVT]?

Land Value Taxation is a method of raising public revenue by means of an annual tax on the rental value of land. It would replace, not add to, existing taxes. Properly applied, Land Value Tax would support a whole range of social and economic initiatives, including housing, transport and other infrastructural investments. It is an elementary fiscal measure that would go far towards correcting fundamental economic and social ills.

The value of every parcel of land in Britain [or in whichever country LVT is applied] would be assessed regularly and the land value tax levied as a percentage of those assessed values.

"Land" means the site alone, not counting any improvements. The value of buildings, crops, drainage or any other works which people have erected or carried out on each plot of land would be ignored, but it would be assumed that all neighbouring properties were developed as at the time of the valuation; other things being equal, a vacant site in a row of houses would be assessed at the same value as the adjacent sites occupied by houses.

The valuation would be based on market evidence, in accordance with the optimum use of the land within the planning regulations. If the current planning restrictions on the use were altered, the site would be reassessed.

The advantages...

A NATURAL SOURCE OF PUBLIC REVENUE. All land makes its full contribution to the Exchequer, allowing reductions in existing taxes on labour and enterprise.

A STRONGER ECONOMY. If we tax labour, buildings or machinery and plant, we discourage people from constructive and beneficial activities and penalise enterprise and efficiency. The reverse is the case with a tax on land values, which is payable regardless of whether or how well the land is actually used. It is a payment, based on current market value, for the exclusive occupation of a piece of land. In the longer term, this fundamentally new and different approach to revenue raising will stimulate new business and new employment, reducing the need for costly government welfare.

MARGINAL AREAS REVITALISED. Economic actitivities are handicapped by distance from the major centres of population. Conventional taxes such as VAT and those on transport fuels cause particular damage to the remoter areas of the country. Land Value Tax, by definition, bears lightly or not at all where land has little or no value, thereby stimulating economic activity away from the centre - it creates what are in effect tax havens exactly where they are most needed.

A MORE EFFICIENT LAND MARKET. The necessity to pay the tax obliges landowners to develop vacant and under-used land properly or to make way for others who will.

LESS URBAN SPRAWL. Land Value Taxation deters speculative land holding. Thus dilapidated inner-city areas are returned to good use, reducing the pressure for building on green-field sites.

LESS BUREAUCRACY. The complexities of Income Tax, Inheritance Tax, Capital Gains Tax and VAT are well known. By contrast, Land Value Tax is straightforward. Once the system has settled down, landholders will not be faced with complicated forms and demands for information. Revaluation will become relatively simple.

NO AVOIDANCE OR EVASION. Land cannot be hidden, removed to a tax haven or concealed in an electronic data system.

AN END TO BOOM-SLUMP CYCLES. Speculation in land value - frequently misrepresented and disguised as "property" or "asset" speculation - is the root cause of unsustainable booms which result periodically in damaging corrective slumps. Land Value Taxation, fully and properly applied, knocks the speculative element out of land pricing.

IMPOSSIBLE TO PASS ON IN HIGHER PRICES, LOWER WAGES OR HIGHER RENTS. Competition makes it impossible for a business producing goods on a valuable site to charge more per item than one producing similar goods on less valuable land - after all, producers and traders at different locations are paying different rents to landlords now, yet like goods generally sell for much the same price and employers pay their workers comparable wages. The tax cannot be passed on to a tenant who is already paying the full market rent.

[Continued… (] (

The Single Tax: What It Is and Why We Urge It

by Henry George

An article published in The Christian Advocate in 1890 and thereafter reprinted in various magazines in the United Stated and England.

I shall briefly state the fundamental principles of what we who advocate it call the Single Tax.

We propose to abolish all taxes save one single tax levied on the value of land, irrespective of the value of the improvements in or on it.

What we propose is not a tax on real estate, for real estate includes improvements. Nor is it a tax on land, for we would not tax all land, but only land having a vaue irrespective of its improvements, and would tax that in proportion to that value.

Our plan involves the imposition of no new tax, since we already tax land values in taxing real estate. To carry it out we have only to abolish all taxes save the tax on real estate, and to abolish all of that which now falls on buildings or improvements, leaving only that part of it which now falls on the value of the bare land, increasing that so as to take as nearly as may be the whole of economic rent (, or what is sometimes styled the “unearned increment of land values.”

That the value of the land alone would suffice to provide all needed public revenues—municipal, county, State, and national—there is no doubt.

To show briefly why we urge this change, let me treat (1) of its expediency, and (2) of its justice.

[Continued… (]


Below, in no particular order, are common objections to land value taxation, with rebuttals by me to each one:

Isn't land ownership the foundation of property rights, and thus of a free society?

No, self-ownership is. That is to say, the foundation of property rights (and the freedom which flows from those rights) is the property each person has in himself and, by extension, in the fruits his labor.

    "Though the earth, and all inferior creatures be common to all men, yet every man has a property in his own person. This nobody has any right to but himself."

-- John Locke, 2nd Treatise of Government, Ch. 5

    "The property which every man has in his own labour, as it is the original foundation of all other property, so it is the most sacred and inviolable."

-- Adam Smith, The Wealth of Nations, Bk 1, Ch. 10, Pt 2

    "The property rights that each citizen has in himself are the foundation of a free society."

-- James Bovard, Freedom In Chains, p. 86

    "Libertarianism begins with self ownership."

-- David Bergland, Libertarianism In One Lesson, 7th ed., p. 35

    "There is only one fundamental right (all others are its consequences or corollaries): a man's right to his own life. Life is a process of self-sustaining and self-generated action; the right to life means the right to engage in self-sustaining and self-generated action--which means: the freedom to take all the actions required by the nature of a rational being for the support, the furtherance, the fulfillment and the enjoyment of his own life…Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means to sustain his life."

-- Ayn Rand, Capitalism: The Unknown Ideal, pp. 321-2

    "The right of life and liberty--that is to say, the right of the man to himself--is not really one right and the right of property another right. They are two aspects of the same perception--the right of property being but another side, a differently stated expression, of the right of man to himself. The right of life and liberty, and the right of the individual to himself, presupposes and involves the right of property, which is the exclusive right of the individual to the things his exertion has produced."

-- Henry George, A Perplexed Philosopher, p. 210

Won’t the land value tax (LVT) make all land the "property" of the government (and thereby make us all "serfs" of the government)?

No, because the government will have no authority to dictate when, how, or by whom land itself is used; it will have only the authority to ensure that the rent ( of land goes to everyone on an equal basis, since all individuals have an equal right ( of access to land.

Henry George puts it this way on page 8 of The Condition of Labor (

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

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

The only alternative to George's proposal is to treat land as the unconditional property of a mere subset of the population. The problem with this alternative is that, when taken to its logical conclusion, we find that the fruits of individual labor must inevitably be treated as conditional property for everyone else. Why? Because no one can produce wealth in the first place unless he or she first has access to land. Consequently, since all land is legally occupied, and since producing more land isn't an option, those who don't have titles to land cannot legally access the earth -- and thus cannot legally sustain their own lives -- unless they first "consent (" to pay a portion of their earnings to those who do have titles to land. (This is why geolibertarians regard landed property as the “mother of all entitlements.”)

Land itself does not originate from labor; thus, "property" in land does not originate from labor, but from the law that confers ownership to an individual or group. Landed property is therefore -- in the words of Albert Jay Nock ( -- “law-made property,” and hence fundamentally distinct from “labor-made property.”

To compel a non-privileged subset of the population to pay rent to a privileged (http://) subset for mere access to the earth is therefore to elevate law-made property above labor-made property. And since the latter is an extension of self-ownership, to elevate the former above the latter is to strike a blow at the very foundation of property rights:

    "Disregard of the equal right to land necessarily involves violations of the unequal right to wealth."

-- Max Hirsch, Democracy vs. Socialism (, p. 372

To this some might object that the LVT does just that -- compels one group to pay rent to another group for mere access to the earth. While this objection may sound logical at first, it is fatally flawed. Why? Because it ignores a universal law of today's economy: the fact that land rent ( gets paid either wayregardless of whether or not it gets diverted into the public treasury.

Thus, it is not a question of “if” land rent gets paid, but to whom and on what basis.

If it is paid exclusively to titleholders on the basis of the earth on which all must live yet which none produced being the exclusive, unconditional property of those titleholders, then, for reasons given above, the property that non-titleholders have in themselves and in the fruits of their labor is thereby violated. If, on the other hand, it is paid to the community on the basis of the individual members of that community each having an equal right to land, then said property right (the right to one's self and the fruits of one's labor) is thereby upheld for everyone -- both titleholder and non-titleholder alike.

Another common objection is that, if government taxes the economic “rent” of land, it automatically becomes the owner of land. This objection is based on the myth that the terms "rent collector" and "owner" are synonymous. While many rent collectors do, indeed, own the property on which they collect rent, there are, nevertheless, thousands of private rental agents and property managers all over the country who routinely collect rent on properties they do not own. Thus, one does not have to be an "owner" to be a "rent collector."  Government is no exception to this rule.

That doesn't mean the government of, say, North Korea does not assert ownership over the land on which it collects rent. It does. But it is not merely the authority to collect land rent, but the authority to dictate how land is used, that makes the North Korean government an "owner" of land. Critics of the LVT repeatedly insist that you can't have one authority without the other, but as mentioned above, the rent-collection services provided by non-owning rental agents and property managers prove just the opposite.

This becomes easier to understand once you realize that "property" refers, not to a single right, but to a bundle of rights -- the right to rental income being only one of them. The other rights include the right to possess, use, exclude, and transfer title. As any lawyer will tell you, those rights can be transferred in whole or in part.

    "The concept of a bundle of rights comes from old English law. In the middle ages, a seller transferred property by giving the purchaser a handful of earth or a bundle of bound sticks from a tree on the property. The purchaser, who accepted the bundle, then owned the tree from which the sticks came and the land to which the tree was attached. Because the rights of ownership (like the sticks) can be separated and individually transferred, the sticks became symbolic of those rights."

-- Fillmore W. Galaty, Wellington J. Allaway, & Robert C. Kyle, Modern Real Estate Practice, 14th ed., p. 16

This is precisely why, in the U.S., it is possible for city councilmen to collect a portion of land rent through property tax levies, yet be lawfully excluded from the land itself by whoever holds title to that land. Although the local government in this case has a legal right to a certain percentage of the land's rental value, the titleholder has all the other rights of the aforementioned "bundle." 

Not only will the titleholder retain those rights under a geolibertarian system, those rights will be strengthened by (a) the fact that he will no longer be taxed for being productive, thus making it far easier for him to afford whatever the rental charge is, and (b) the fact that the law will require any and all surplus revenue to be distributed equally as a Citizen’s Dividend (,374.msg1127.html#msg1127). (The latter will provide a built-in incentive for citizens to bring enormous pressure to bear on government to limit its spending, since less wasteful spending will mean a greater surplus, and thus a higher dividend.)

Since people need food to sustain their lives, and since food, like land, is in limited supply, could not the same argument for taxing the value of land be used to justify taxing the value of food?

No, because (a) while food is in "limited" supply, it is not in fixed supply; and (b) with food starvation is not the only alternative to purchasing it from others, whereas with land it is.

With food, one can always produce instead of buy. Not so with land. Some might counter that one can always produce to earn the wages needed to acquire land, but this presupposes the very issue in question – access to land. While it is true people can always acquire land by earning the wages needed to rent or purchase it, one cannot earn wages to begin with unless one first has access to land, which brings us right back where we started.

Food is a product of labor; land is not. Thus, the notion that one has an exclusive right to the fruits of one’s labor is incompatible with the notion that there is a common right to the value of those fruits, while it is not incompatible with the notion that there is a common right to the value of land.

Won’t the LVT increase the price of land?

No, just the opposite.

As Henry George explains here (, in order for a tax to drive up the price of something, it must either decrease supply or increase demand. Does the LVT decrease the supply of land? No, because the supply of land is fixed. Thus, the only way it can increase the price is by increasing demand. Yet not even those who oppose the LVT argue that it increases demand, so it follows that the LVT does not increase the price of land, since it neither decreases supply nor increases demand.

In fact, it actually lowers the price of land by reducing the amount of privately pocketed rent that can be capitalized into a sale price.

Expressed in mathematical terms, the price of land p equals the annual rent r divided by the interest rate i, or:

                            p = r / i

If there is a tax rate t on the price of land p, then p equals the rent divided by the sum of the interest rate and the offsetting tax rate, or:

                            p = r / (i + t)

Thus, if the rent is $1,000, the interest rate is 10%, and the tax rate 40%, then the price would be 1,000/(.10 + .40), or $2,000. Without the tax, the price would be 80% higher -- $10,000. (More on this here ( and here (

This is why there is no long-term benefit to cutting the LVT, because people in general, and the working poor in particular, end up paying back in higher rents and land prices what they presumably get from the tax cut. (The working poor of California had to find this out the hard way after the passage of Proposition 13 (

Unfortunately, because the property tax fuses the tax on land values with the tax on improvements (, people have a tendency to equate one with the other, and thus falsely assume that a lower tax on land value yields the same benefits as a lower tax on improvements. It in fact has the opposite effect. A lower tax on improvements rewards people for putting land to productive use, which means more jobs and higher wages; a lower tax on land value rewards people for holding land out of use, which means less jobs and lower wages.

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on August 23, 2010, 03:57:01 pm
Isn’t the LVT based on Karl Marx's labor theory of value?

No. Karl Marx’s labor theory of value asserts that the exchange value of something is determined by the labor expended to produce it. Henry George flat-out rejected this view:

    "It is never the amount of labor that has been exerted in bringing a thing into being that determines its value, but always the amount of labor that will be rendered in exchange for it."

-- The Science of Political Economy (, p. 253

Why, then, do some mistakenly identify Marx's labor theory of value as being one of the core premises of the LVT? Because many LVT advocates often describe land value as being created by the community, and, in so doing, sacrifice clarity for brevity. What they actually mean is this: It's not that members of the surrounding community create land value itself, but that they create (or rather “produce (”) the goods and services which give rise to that value.

As any real estate appraiser will tell you, the value of land is the value of “location (” And what determines the value of location? The degree to which people in the surrounding marketplace compete for access to that location, due primarily to the proximity it affords to such things as nearby schools, libraries, hospitals, parks, shopping malls, etc. -- all of which are provided mostly if not entirely by people other than the individual titleholder.

Hence Max Hirsch’s conclusion that:

    "The value of labour-products is the measure of the service which their rightful owner has rendered to the community. The value of land is the measure of the service which the community is expected to render to the owners of land."

-- Democracy vs. Socialism, p. 348

And hence Robert De Fremery’s observation that:

    “The difference between publicly created and privately created values, once seen, is never forgotten. Both result from the competitive bidding within society for the right to consume or use something. But it is of utmost significance that privately created values result from competitive bidding for goods and services produced by man, whereas publicly created values result from competitive bidding for something no man produced--the land upon which we live and work and whose value increases as the community in which it is located grows. In the one case men are bidding for goods and services produced by each other as private individuals. In the other men are bidding for the important right to use part of the earth's surface. In the one case you have privately created values. In the other you have a publicly created value.”

-- Rights vs. Privileges (, p. 22

Isn't the LVT based on the Marxist idea that the right to land is a collective right?

No, it is based on the Lockean idea that the right to land is an equal right.

By that I mean: the idea that an individual has "property" in land only to the extent that there is, in the words of John Locke, "enough, and as good left in common for others ("  In that sense, the right to land is not a collective right, but an individual right that exists independently of the collective (i.e., society). The “equality” of this right is merely a limitation that arises from the presence of others with like rights.

By contrast, a collective right to land dictates that an individual has no right to use any land unless society has granted him such right.

With the equal right to land, one does not require the consent of society to use land. The right to the use of land belongs at birth to each individual. So while the consent of others is not needed, it is, nevertheless, necessary that in the exercise of that right, one does not infringe upon the equal right of others -- i.e., violate Locke's proviso that there be "enough, and as good left in common for others." And since the rental value ( of land provides an accurate measure of the extent to which said proviso has been violated, "others" should be compensated in accordance with that value. ( (

At the same time, of course, taxes on wages, sales, houses and capital goods should all be abolished, since they violate the exclusive right that each individual has to the fruits of his own labor.

It is, of course, an age-old tradition among royal libertarians ( to rail self-righteously against the notion that all individuals have an "equal" right to land (and hence to its rental value). Yet what they either fail to realize or refuse to admit to is that, in so doing, they are rejecting (in effect) the most fundamental "property right" of all -- that of self-ownership -- because one cannot even be a "self" in the first place unless one occupies a naturally-occurring geographic location on the globe.

In short, to "be" is to be -- "somewhere."

Thus, assuming everyone agrees with Michael Badnarik when -- in his book, Good to be King ( -- he defines a "right" as "something you can do without asking for permission," it follows that, whenever anyone suggests or implies that only those with land titles have a "right" of access to the earth on which all must live yet which none produced, that person is essentially saying that the countless millions without land titles have no "right" to life itself.

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

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

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

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

That, incidentally, is largely why I regard the Austrian School's aristocratic ( concept of "liberty" to be a sick joke.

    “The Austrian School came into existence when a bunch of Viennese rent-gouging landlords didn’t want rent control on the rents they could gouge out of their tenants in old Vienna, so they hired a bunch of scribblers--and that’s the Austrian School.”

-- Webster Tarpley, World Crisis Radio ( broadcast, 9/27/08

Isn't the very concept of taxing land values rooted in Marxism?

No, it's rooted in classical liberalism (, which long predates Marx.

The right-wing reactionaries who blindly insist otherwise are -- whether they realize it or not, and whether they have the intellectual honesty to admit it or not -- essentially accusing many of the Founding Fathers of being Marxists:

------------------------------------ (

Why America's Founders Wanted a Property Tax on Land Value, And NOT a Sales Tax!

Why a Land Value Tax?

Land for ordinary citizens

William Penn ( wanted to keep aristocrats from grabbing up land as they had in Europe. He declared Pennsylvania a "commonwealth" where each landholder would pay a modest rent that "would put an end to taxes, leave not a beggar, and make the greatest bank for national trade." The first tax in Pennsylvania was a land value tax.

Thomas Jefferson ( also saw that land monopoly made ordinary Europeans poor, while cheap land made Americans rich. He also proposed taxes on real estate to prevent land grabbers from driving land prices up.

Keeping taxing power local

Under the Articles of Confederation (, the federal government taxed each state on its land value. Each state would tax each county, and citizens would never have to deal with state or federal tax collectors. Our founders did not trust strong central governments. They believed that people govern their own communities better than powerful states can govern them.

[Continued... (]


Isn't concentrated ownership of land moral and just, so long as it's the result of "voluntary" transactions?

No, because if only some people "own" the earth, then only some have a "right" to live upon it.

All individuals must have access to the earth in order to exercise their right to sustain their own lives. Thus, to allow the earth to become the unconditional property of a relative few is to deny this right to everyone else, since it makes the latter obligated at birth to pay the former for mere access to the planet -- as if the former were responsible for the earth’s very existence.

While the private appropriation of land rent ( may seem harmless at a micro-level, at a macro-level it constitutes an entitlement scheme whereby Group A receives payment from Group B, even though Group A renders no service ( in return. In that sense, it violates the fundamental right that the members of Group B have to the fruits of their own labors.

    "As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed."

-- Adam Smith, The Wealth of Nations, Bk 1, Ch. 6

    “Given a stationary population and private ownership of all land, improvements in manufacturing methods do not, in the long-run, increase the earnings of labour and capital, but are absorbed by rent.”

-- Max Hirsch, Democracy vs. Socialism, p. 446

    "I am using the word wages not in the sense of a quantity, but in the sense of proportion. When I say that wages fall as rent rises, I do not mean that the quantity of wealth obtained by laborers as wages is necessarily less, but that the proportion which it bears to the whole produce is necessarily less. The proportion may diminish while the quantity remains the same or even increases."

-- Henry George, Progress and Poverty, p. 216

If some people fail to see this, it is because they, in the words of Henry Hazlitt, "overlook the woods in their precise and minute examination of particular trees." In this case they overlook the effect that the private appropriation of land rent has on the economy as a whole in their precise and minute examination of particular transactions, and how these transactions benefit particular individuals or groups. Overall, the payment of land rent to the few at the expense of the many imposes on the latter artificially high costs of living, on the one hand, and artificially low wages, on the other.

To learn more about why the current land market is anything but "voluntary," read the following article by Fred Foldvary: (

As a general rule, taxation is wrong since it involves the use of force. Is a tax on land rent an exception to this?

Yes, for the simple reason that "force," as such, is neither good nor bad. If used to defend one's person or property from aggressors, or to enforce payment of a rightful debt, it is a good thing. If used to harm the person or property of a non-consenting other, or to enforce payment of a wrongful debt, it is a bad thing.

A tax on wages or capital-goods returns implies that the income one receives in return for the exertion of one's labor or the use of one's capital goods belongs (at least in part) to others. This conflicts with the basic libertarian principle that you have an exclusive right to the fruits of your labor.

A tax on land rent (or "rent (" for short) implies that the income one receives for the value of the land one holds belongs to others. Since land itself (a) is not the fruit of anyone's labor, and (b) is that to which all have an equal right of access; and since the rent of land (a) is not a return to either labor or capital goods, and (b) reflects the extent to which Locke's proviso has been violated, a "tax" on rent does not conflict with the principle that you have an exclusive right to the fruits of your labor, but is in fact a just and necessary means of upholding that right.

Thus, the part of one's income that is taken via the taxation of wages, sales, houses and capital goods constitutes the enforcement of a wrongful debt, whereas the part of one's income that is taken via the taxation of rent constitutes the enforcement of a rightful debt.

As Henry George puts it on page 46 of Property In Land ( "As to what constitutes robbery, it is...the taking or withholding from another of that which rightfully belongs to him. That which rightfully belongs to him, be it observed, not that which legally belongs to him." [Emphasis original]

Still, right-wing critics will argue, a tax on rent involves the use of force, and is therefore wrong. The problem with this argument becomes evident when they are presented with the scenario of a tenant no longer able to pay a titleholder for the value of the land he is using, and then asked whether or not it would be legitimate to use force to remove the tenant from the titleholder's land. They typically answer “yes” to this question, and when pressed for an explanation, finally concede that yes, there is such a thing as a legitimate use of force when it comes to upholding a rightful debt.

The dispute, then, is not over whether force, in and of itself, is right or wrong, but whether the debt in question is right or wrong -- i.e., whether or not the taxation of land rent conflicts with the libertarian principle that each person has property in himself and, by extension, in the fruits of his labor. Geolibertarians hold that it does not so conflict, since land rent, as mentioned before, is not a return to either labor or capital goods.

Land rent (as the term obviously implies) is in fact a return to land -- meaning the percentage of one's income one could receive simply by renting out the land one holds to someone else. Yet to whom does land’s rental value rightfully belong?  Since this value derives, not from what the individual titleholder does, but from the growth and activity of the surrounding community -- and since it reflects the extent to which "others" are denied access to land they wish to use, and to which they have an equal right of access -- it follows that this value is rightfully owed to these others, while wrongfully owed to titleholders.

In that fundamental sense, the LVT is not a fee for using land, but a fee for the government-enforced privilege of denying use of that land to everyone else. The more valuable the privilege, the higher the fee. That's why it's called the benefits received ( principle, and hence why the upper and upper-middle class titleholders who rail hysterically against the LVT are essentially saying that (double standard ( alert!) they should not be required to pay for the benefits they receive, but that working class ( non-titleholders should be required to pay -- not once, but twice ( -- for the benefits they receive. 

Won’t the LVT make it more difficult to acquire land, especially for poor people?

No, because land rent, as explained earlier, gets paid either way -- regardless of whether or not it gets diverted into the public treasury.

Even when you pay the sale price of land, you are paying land rent, since the sale price is simply capitalized rent (i.e., the rental value divided by the interest rate). And since land is fixed in both supply and location, decreases in land value taxation are invariably capitalized by titleholders into higher rents and land prices. Thus, people in general, and the working poor in particular, end up paying back in higher rents and land prices what they presumably get from the tax cut; and pay back even more in terms of (a) a lower margin of production ( (and thus lower pre-tax wages), and (b) a heavier reliance on wage ( and sales ( taxes. 

So, once again, it is not a question of if land rent gets paid, but to whom and on what basis -- to a mere subset of the population, on the basis of the earth on which all must live yet which none produced being exclusively "owned" by that subset; or to everyone equally, on the basis of the earth being that to which all have an equal right of access? Georgists and geolibertarians believe it should be the latter, since that is the only just and practical way of establishing true equality of opportunity without enforcing “equality of outcome” in the process.

As for the poor people that right-wing ideologues (, limousine liberals ( and foundation ( poverty pimps ( all laughingly profess to care so much about, the LVT will actually make it much easier for them to acquire land, since it will (a) greatly reduce the “rack-renting (” to which land speculation ( invariably gives rise, and (b) dramatically increase wages both by raising the margin of production and by reducing (and eventually eliminating) the need for either wage or sales taxes.

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on August 23, 2010, 03:57:55 pm
Won’t the LVT discourage production?

No, because the value of land has no reference to a cost of production; it is purely a function of demand.

This, among other things, led Adam Smith to conclude that:

    “Both ground-rents and the ordinary rent of land are a species of revenue which the owner, in many cases, enjoys without any care or attention of his own. Though a part of this revenue should be taken from him in order to defray the expenses of the state, no discouragement will thereby be given to any sort of industry....Ground-rents and the ordinary rent of land are, therefore, perhaps, the species of revenue which can best bear to have a peculiar tax imposed upon them."

-- The Wealth of Nations, Bk 5, Ch. 2, Pt 1

Nobel prize-winning economist, Paul A. Samuelson, reached the same conclusion roughly two centuries later:

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

-- Economics (, 16th ed., p. 250

What is even more "striking" is that Samuelson's remarks are only half-true. Not only will a tax on rent lead to no distortions or economic inefficiencies, it will actually stimulate the economy by (a) lowering the entrance barrier ( into the marketplace (the “entrance barrier” being speculative rents and land prices), and (b) encouraging much more efficient use of land within that marketplace. A well-documented case in point is the overall success of the "split rate" property tax (whereby land values are uptaxed and improvements proportionately downtaxed) in over a dozen localities throughout Pennsylvania: ( (

It is the taxation of the other two factors of production -- labor and capital goods -- that penalizes and discourages production. Thus, it follows that the more we shift the tax burden off those two factors and onto land values, the more prosperous the economy will be overall.

Henry George put it this way:

    “To abolish that taxation which, acting and reacting, now hampers every wheel of exchange and presses upon every form of industry, would be like removing an immense weight from a powerful spring. Imbued with fresh energy, production would start into new life, and trade would receive a stimulus which would be felt to the remotest arteries. The present method of taxation... operates upon energy, and industry, and skill, and thrift, like a fine upon those qualities. If I have worked harder and built myself a good house while you have been contented to live in a hovel, the taxgatherer now comes annually to make me pay a penalty for my energy and industry, by taxing me more than you. If I have saved while you wasted, I am mulct, while you are exempt. If a man build a ship we make him pay for his temerity, as though he had done an injury to the state; if a railroad be opened, down comes the tax collector upon it, as though it were a public nuisance; if a manufactory be erected we levy upon it an annual sum which would go far toward making a handsome profit. We say we want capital, but if any one accumulate it, or bring it among us, we charge him for it as though we were giving him a privilege. We punish with a tax the man who covers barren fields with ripening grain, we fine him who puts up machinery, and him who drains a swamp....

    “To abolish these taxes would be to lift the whole enormous weight of taxation from productive industry. The needle of the seamstress and the great manufactory; the cart horse and the locomotive; the fishing boat and the steamship; the farmer's plow and the merchant's stock, will be alike untaxed....Instead of saying to the producer, as it does now, ‘The more you add to the general wealth the more shall you be taxed!’ the state would say to the producer, ‘Be as industrious, as thrifty, as enterprising as you choose, you shall have your full reward! You shall not be fined for making two blades of grass grow where one grew before; you shall not be taxed for adding to the aggregate wealth.’”

-- Progress & Poverty (, pp. 434-5

There are some who still insist that the LVT will discourage production since the value of land cannot be separated from the value of houses, buildings and other improvements. Is that true?

No, it has long been common practice in the real estate industry to assess land separately from improvements:

    "Land value represents the present market value of the land. It does not include the value of improvements. Land value is arrived at through an analysis of current sales of comparable land in the general area. It is computed separately because land is not depreciable."

-- William L. Ventolo, Jr., Ralph Tamper & Wellington J. Allaway, Mastering Real Estate Mathematics, p. 115

The only people on the entire planet who blindly insist otherwise are brainwashed Austrian School (,395.0.html) types.

Some people claim there are documented examples of land being produced. Doesn't this refute the idea that land is in fixed supply?

No. Those who claim otherwise are confusing two different senses of the word land ( In the every day sense, land usually refers merely to the dry surface of the earth; in the economic sense, however, it refers not just to the dry surface of the earth, but to the entire material universe -- excluding humans and their products. In other words, land is not merely matter that occupies space; it is space. While matter can certainly be manipulated within that space, space itself cannot be added to or subtracted from. This is precisely why the value of "land" is often and more accurately described as the value of "location."

    "The essential feature of land is that its quantity is fixed and completely unresponsive to price."

--  Paul A. Samuelson & William D. Nordhaus, Economics, 16th ed., p. 248

    "Land has no production cost; it is a 'free and nonreproducible gift of nature.'  The economy has only so much land, and that is that. Of course, within limits any parcel of land can be made more usable by clearing, drainage, and irrigation. But these are capital improvements and not changes in the amount of land itself."

-- Campbell R. McConnell & Stanley L. Brue, Economics, 14th ed., p. 604

    "Land, which is the earth's surface, is immobile. It is true that some of the substances of land are removable and topography can be changed, but still that portion of the earth's surface always remains. The geographic location of any given parcel of land can never be changed. It is rigid and fixed."

-- Wade E. Gaddy & Robert E. Hart, Real Estate Fundamentals, 4th ed., p. 9

    "Remember: No one is making any more land."

-- William H. Pivar, Real Estate Investing From A To Z, revised edition, p. 3

Won’t the LVT hurt farmers?

No, it will help farmers. In the first place, the LVT will fall primarily on urban land, not rural land, since land values are concentrated primarily in urban areas. In the second place, the increased cost of paying a higher tax on land values will be more than offset by (a) the savings incurred from paying lower taxes on everything else, (b) the reversal of urban sprawl ( (and thus of the inflationary pressure that sprawl has long imposed on the value of farmland), and (c) the increase in income that will result from both a higher margin of production ( and the resultant surge in overall economic activity.

For supportive empirical evidence, see the following: ( (
For a more exhaustive treatment of the underlying principles, see: (      (

Since labor products such as houses, cars and computers are all composed of matter, and since humans are no more the “creators” of matter than they are the “creators” of land, doesn’t it follow that humans don’t really “create” anything, and that LVT advocates are therefore wrong in saying there’s a fundamental distinction between “labor-made” property and “law-made” property?

Believe it or not, I’ve actually encountered this objection many times over the years. It exemplifies the sort of mental gymnastics to which royal libertarians ( routinely resort in their desperate attempt to justify economic free-riding ( by overprivileged landlords.

The objection is, of course, ridiculous on its face, because -- as any professional real estate appraiser will tell you -- land, by definition, exists independently of human exertion, whereas labor products (as the term itself implies) do not.

What makes houses, buildings and countless other labor products fundamentally different from land is not that people “create” those things, but that they produce them:

    "We speak of productive work. What is productive work? We make things. How do we make them? Man does not create them. Man cannot create something out of nothing. All the things that we call making are producing; bringing forth, not creating.

    "Men produce coal by going down under the ground, hewing out the coal, and bringing it to the surface of the earth; they produce fish by going to the lough, or river, or ocean and pulling the fish out; they produce houses by bringing together timber and stones and iron into the shape and form of a house; they produce cloth by taking the wool of a sheep or the fibers of a plant and bringing them together in a certain connection; they produce crops by opening the ground and putting in seed and leaving it there for the germinating influences of nature--always a bringing forth, never a creation, so that human exertion--that is to say labor upon land, is the only way that man has of bringing forth those things which his needs require and which are necessary to enable him to sustain life. Land and labor--these are the two necessary and indispensable factors to the production of wealth."

-- Henry George, The Land for the People (, paragraphs 4 & 5

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on August 23, 2010, 03:59:10 pm
Didn't Austrian economist Murray Rothbard refute the LVT?

No, but not for lack of trying. Rothbard's argument against the LVT is fatally flawed for at least two reasons -- one moral, the other economic. From a moral perspective, it completely ignores the unjust interference that the overextension of law-made property imposes on labor-made property. From an economic perspective, it is based on a false understanding of what conditions are necessary for land to have rental value.

In Libertarian Party at Sea on Land (, LP activist Dr. Harold Kyriazi explains why Rothbard's attack on the LVT was misguided at best. The following is from pages 57-61 of that book (all emphasis original):


The only well-known libertarian writer whom I know to have explicitly, and at great length, opposed the idea of community collected user fees for natural resources is Murray Rothbard, which is odd, given his admiration for Albert Jay Nock and Frank Chodorov, who, in turn, revered Henry George. Rothbard apparently had extensive discussions with Georgists:

    If every man owns his own person and therefore his own labor, and if by extension he owns whatever property he has "created" or gathered out of the previously unused, unowned "state of nature," then what of the last great question: the right to own or control the earth itself? ... It is at this point that Henry George and his followers, who have gone all the way so far with the libertarians, leave the track and deny the individual right to own the piece of land itself, the ground on which these activities have taken place. (pp. 33-34, For a New Liberty.)

The following is taken from his The Ethics of Liberty.

    (p. 50, footnote 2): A modified variant of this "Columbus Complex" holds that the first discoverer of a new island or continent could properly lay claim to the entire continent by himself walking around it (or hiring others to do so), and thereby laying out a boundary for the area. In our view, however, their claim would still be no more than to the boundary itself, and not to any of the land within it, for only the boundary will have been transformed and used by man.

With this statement, Rothbard may seem to have carried the "first use" doctrine to its illogical extreme. (If walking over some land constitutes transformation and use, then is it just one's footprints that one owns? Or does one's rightful claim extend out to all the underbrush one has cleared away? Or, can one claim land as far as the eye can see? This is the very definition of the word "arbitrary.") But in his defense, to convert the claim into actual ownership would, Rothbard would say, require actual use (though we're again faced with the question of what constitutes "use" -- see p. 79, "Anti-Rothbard..."). For example, earlier, in a Robinson Crusoe paradigm, he stated that Crusoe's "true property--his actual control over material goods--would extend only so far as his actual labor brought them into production. His true ownership could not extend beyond the power of his own reach."

What, then, would Rothbard say about large American corporations owning, but not using, millions of acres of land, as some now do? He gives us his answer in an essay he wrote on Henry George's Land Value Tax idea, entitled "The Single Tax: Economic and Moral Implications" (FEE "Special Essay Series," 1957). Here are a few examples from that work:

    Well, what about idle land? Should the sight of it alarm us? On the contrary, we should thank our stars for one of the great economic facts of nature: that labor is scarce relative to land...Since labor is scarce relative to land, and much land must therefore remain idle, any attempt to force all land into production would bring economic disaster. Forcing all land into use would take labor and capital away from more productive uses, and compel their wasteful employment on land, a disservice to consumers.

Of course, LVT would and could do no such thing, as those who strive to put idle land into productive use would have to bid against other land users for labor, and only the best uses of labor and land would win out. Thus, rather than forcing all land into use, LVT would discourage all but the most productive use of land, just as any market tends to allocate resources most wisely. Another thing that would happen is that the earnings of labor would increase due to increased competition for it, and (ideally) none of the produced wealth would go to landowners qua landowners. Let me rephrase Rothbard's last sentence in a way that makes sense: Forcing land users to pass over ideal idle land and utilize marginal land instead, is wasteful of human labor and natural opportunities, a disservice to all mankind and a boon only to landlords and land speculators.

But here's the most embarrassing passage:

    A 100% tax on rent would cause the capital value of all land to fall promptly to zero.


    Since owners could not obtain any net rent, the sites would become valueless on the market.

False! They'd be valueless only to those market participants who wish only to speculate in land, not to those who wish to use land in some productive endeavor.

    From that point on, sites, in short, would be free.

Wrong again. While it's true there'd be no sale price for vacant land, one would still have to pay the ground-rent to use it.

    Further, since all rent would be siphoned off to the government, there would be no incentive for owners to charge any rent at all.

Wrong yet again. He's assuming the LVT would be set by an actual ground-rent charged by the landlord, rather than being an assessed value that would have to be recouped. And, I might add, total rental costs would tend to decrease as additional units come on the market as the monopoly stranglehold on land loses its grip.

    Rent would be zero as well, and rentals would thus be free.

He continues to pound a straw man.

    The first consequence of the single tax, then, is that no revenue would accrue from it.

He took a wrong turn, and just keeps going!

    Far from supplying all the revenue of government, the single tax would yield no revenue at all! For if rents are zero, a 100% tax on rents will also yield nothing.

Rothbard then goes on to state,

    Compelling any economic goods to be free wreaks economic havoc...the result is to introduce complete chaos in land sites.

Completely false. Even if LVT were applied at a national level, and there were no competition among municipalities for residents, people would still bid on the leases of occupied property, providing price information. (For more on this, see p. 97, "How would LVT work?")

In Power and Market: Government and the Economy (second edition, 1977), Rothbard went even further into the realm of irrationality in his attempt to refute Georgist land theory (p. 131):

    Contrary to Georgist doctrine, however, the land problem does not stem from free-market ownership of ground land.

I know of no Georgist who would ever use the phrase "free-market" in conjunction with our current, individual monopoly market in land.

    It stems from failure to live up to a prime condition of free-market property rights, namely, that new, unowned land be first owned by its first user, and that from then on, it become the full private property of the first user or those who receive or buy the land from him.

It is an obvious fiction that any use, however small or large the effort, should grant full private ownership for all time, unless we're talking about a make-believe world with unlimited land where access to all of it is instantaneous (i.e., where travel time is zero). This fiction ignores the fact that someone who, for example, puts up a fence and lets a cow graze, is much less the rightful "owner" of land than one who builds an industrial plant or a shopping mall. (For more on this, see p. 79, "Anti-Rothbard...")

( (


In his contribution to Critics of Henry George: Volume 2 ( (see Chapter 31 of that book), Dr. Kyriazi provides an even more devastating critique of Rothbard’s fallacy-ridden arguments against Henry George’s Single Tax.

See also the following article by Gene DeNardo: ( (A Critique of Murray Rothbard's Critique of the Georgist Argument.)

Isn't land less important in today's economy than it was decades ago?

No. To understand why, simply ask yourself the following question. If the importance of land has indeed gone down, then why was the inflation-adjusted price of land so much higher in, say, 2006 than it was 50 years beforehand?

The answer is obvious: because, as the economy and population grow -- and as this, in turn, results in increasing numbers of people with higher incomes competing for access to the same amount of land -- the “importance” of land (as reflected in rents and land prices) grows along with them.

It is, of course, true that land values have recently dropped in many areas due to the collapsing real estate bubble. But as economist Fred Foldvary explains here (, the speculation-driven real estate market tends to experience such price contractions about every 18 years, only to resume its former upward trend. If you made a historical chart depicting fluctuations in land values over the past century (adjusting for inflation), you’d notice an upward trend, not a downward one.

Are land values capable of generating the revenue needed for the legitimate functions of government?

The answer to this question depends on (a) how you interpret national income figures, (b) what you consider to be the "legitimate" functions of government, (c) the extent to which a reduction in taxes on labor and capital goods will drive up the rental value of land (and thus revenue capacity), and (d) the extent to which shifting to a land-based tax system will increase economic output (and thus the tax base).

With respect to national income figures, many economists accept (seemingly without question) the Commerce Department's claim that land rent ( makes up only 2% of the national income. Assuming for the sake of argument that this is true, that means a land-based tax system could yield no more than a few hundred billion in annual revenue.

Not all economists, however, subscribe to the belief that rent constitutes only 2% of the national income. For instance, in The Losses of Nations ( (1998), economist Fred Harrison explains how a study by Wall Street economist Michael Hudson revealed that the revenue capacity of land is actually about 14% of the national income, or what in 2009 would’ve amounted to approximately $1.7 trillion in annual revenue.

With respect to the "legitimate" functions of government, there are some who consider all current expenditures (including such things as corporate welfare and imperialist wars of aggression) to be "legitimate," in which case the LVT will need to generate well over $3 trillion in annual revenue for all levels of government. On the other hand, there are some who consider "legitimate" only those expenditures that go toward protecting individual rights (e.g., defending our national borders from military invasion, enforcing laws against force and fraud, adjudicating civil disputes, etc.) and toward maintaining some form of basic social safety net (particularly if provided with a minimum of bureaucracy, as a Guaranteed Income ( would do), in which case the LVT will need to generate no more than half of what is currently spent at the federal, state and local levels.

With respect to the reduction of taxes on labor and capital goods (“capital (” for short), and the effect this has on the rental value of land, economists throughout history have observed that, when said taxes are lowered, land rents tend to rise proportionately. Why? For the simple and obvious reason that, the more people can afford to pay for access to a fixed quantity of land, the more titleholders are able to charge higher rents. If, for instance, the payroll tax were abolished, most of the resultant increase in take home pay would eventually be absorbed by higher rents. Thus, it follows that the more the tax burden on labor and capital is reduced, the more the revenue capacity of land is raised by a comparable amount. (Economist Mason Gaffney explains this more thoroughly in Ch. 7 of The Losses of Nations.)

And finally, with respect to economic output, it is common knowledge that, all else being equal, an increase in output means an increase in tax revenue (regardless of the tax system in place). It is also common knowledge that, all else being equal, an increase in output means an increase in the rental value of land (regardless of whether land rent is collected publicly or privately). The question thus arises: to what extent will a land-based tax system increase output, and hence the tax base? On page 147 of The Losses of Nations, economist Nicolaus Tideman estimates that

    "...a shift to public collection of rent as the principal source of public revenue in the U.S. in 1993 would have increased the output of the U.S. economy by $1,602 billion above its actual level for 1993, implying that the U.S. economy is producing only 77 percent of what it could produce with a better tax policy."

All that being said, if you take the Commerce Department at its highly suspect word on rent being only 2% of the national income; if you believe that current tax revenue outlays at all levels of government should be maintained; and if you ignore the extent to which both economic output and the rental value of land will skyrocket in the absence of taxes on labor and capital, then you will undoubtedly conclude that land rent is not an adequate source of public revenue. 

If, on the other hand, you agree with Dr. Hudson's conclusion that rent is approximately 14% of the national income (if not more (, then even if you oppose a moderate reduction in overall spending; and even if you ignore the increase in both economic output and land values that would accompany any significant decrease in the taxation of labor and capital, the LVT will still allow for the abolition of the federal individual income tax. But if you believe that $1.7 trillion could easily fund the legitimate functions of government, and if you realize the extent to which both economic output and the rental value of land would increase in the absence of taxes on labor and capital, then you will almost certainly conclude, as I have, that land rent is a more than adequate source of revenue for all levels of government.

How will the LVT be implemented?

In short, the same way it is now.

Critics of the LVT are fond of pretending that land values are not already being taxed, when in fact they are (albeit to a limited extent) by existing property taxes. The machinery for the LVT is already in place. Thus, all that is necessary to implement the LVT locally is to exempt houses, buildings and other improvements from taxation, and thereby focus existing property taxes on land values only. In this way the property tax will be converted to a land value tax.

As for state and federal taxation, geolibertarians advocate a bottom-up system whereby a portion of the LVT-revenue generated locally is sent to the applicable state governments, and a portion of that, in turn, to the federal government.

    "The question naturally arises: How should Federal, state, and local governments obtain the rental value of land? The practical answer is that we should return to the constitutional provision that requires our Federal government to apportion direct land taxes among the states according to their respective populations. The states, in turn, should obtain this revenue and the revenue for their own support by apportionment among their counties, in the way Nebraska, Texas, Montana, and a number of other states still do. The counties, as agents of the states, should collect their revenue, and the revenue needed by state and Federal governments, from the rental value of their lands, using existing property tax collection machinery. These changes would reverse the trend of the last 50 years. Instead of lower levels of government becoming increasingly dependent upon higher levels of government for aid, thereby losing their independence, the higher levels of government would return to dependence upon the lower. That is as it should be if we wish to preserve our liberties."

-- Robert De Fremery, Rights vs. Privileges (, pp. 39-40

Ideally, this will be phased in over a period of years. That is, as the LVT is moderately increased each year, taxes on everything else are proportionately decreased.

This process will continue until all taxation is abolished save for that upon on land rent, at which point we will finally be operating under Henry George’s Single Tax (

( (

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on August 23, 2010, 04:00:11 pm
I've been calling myself a "geolibertarian" since September 1997, and the following essay is the primary reason why:

------------------------------- (

Are you a Real Libertarian, or a

by Dan Sullivan, founder, Geolibertarian Society, and
former chair, Libertarian Party of Allegheny County, (Pittsburgh) Pennsylvania

We call ourselves the "party of principle," and we base property rights on the principle that everyone is entitled to the fruits of his labor. Land, however, is not the fruit of anyone's labor, and our system of land tenure is based not on labor, but on decrees of privilege ( issued from the state, called titles. In fact, the term "real estate" is Middle English (originally French) for "royal state." The "title" to land is the essence of the title of nobility, and the root of noble privilege.

The royal free lunch

When the state granted land titles to a fraction of the population, it gave that fraction devices with which to levy, and pocket, tolls on the fruits of the labor of others. Those without land privileges must either buy or rent those privileges from the people who received the grants or from their assignees. Thus the state titles enable large landowners to collect a transfer payment, or "free lunch" from the actual land users.

The widow is gathering nettles for her children's dinner; a perfumed seigneur, delicately lounging in the Oeil de Boeuf, hath an alchemy whereby he will extract the third nettle and call it rent.

-- Carlyle

Tortured rationalizations

According to royal libertarians, land becomes private property when one mixes one's labor with it. And mixing what is yours with what is not yours in order to own the whole thing is considered great sport. But the notion is filled with problems. How much labor does it take to claim land, and how much land can one claim for that labor? And for how long can one make that claim?

According to classical liberals, land belonged to the user for as long as the land was being used, and no longer. But according to royal libertarians, land belongs to the first user, forever. So, do the oceans belong to the heirs of the first person to take a fish out or put a boat in? Does someone who plows the same field each year own only one field, while someone who plows a different field each year owns dozens of fields? Should the builder of the first transcontinental railroad own the continent? Shouldn't we at least have to pay a toll to cross the tracks? Are there no common rights ( to the earth at all? To royal libertarians there are not, but classical liberals recognized that unlimited ownership of land never flowed from use, but from the state:

A right of property in movable things is admitted before the establishment of government. A separate property in lands not till after that establishment.... He who plants a field keeps possession of it till he has gathered the produce, after which one has as good a right as another to occupy it. Government must be established and laws provided, before lands can be separately appropriated and their owner protected in his possession. Till then the property is in the body of the nation.

-- Thomas Jefferson (

"But we're used to it"

A favorite excuse of royal libertarians is that the land has been divided up for so long that tracing the rightful owners would be pointless. But there can be no rightful owners if we all have an inalienable right of access to the earth. It is not some ancient injustice we seek to rectify, but an ongoing injustice. The piece of paper granting title might be ancient, but the tribute levied on the landless goes on and on.

One might as well have accepted monarchy under the excuse that whatever conquest led to monarchy occurred centuries ago, and that tracing the rightful monarchs would be pointless. Indeed, landed aristocracy is the last remnant of monarchy.

Phony Laissez Faire

After conquest and confiscation have been effected, and the State set up, its first concern is with the land....In its capacity as ultimate landlord, the State distributes the land among its beneficiaries on its own terms.

-- Albert J. Nock, Our Enemy the State, p. 44

The English free-trader Cobden remarked that "you who free the land will do more for the people than we who have freed trade." Indeed, how can anyone speak of free trade when the trader has to pay tribute to some favored land-entitlement holder in order to do business?

This imperfect policy of non-intervention, or laissez-faire, led straight to a most hideous and dreadful economic exploitation; starvation wages, slum dwelling, killing hours, pauperism, coffin-ships, child-labour--nothing like it had ever been seen in modern times...People began to say, if this is what State abstention comes to, let us have some State intervention.

But the state had intervened; that was the whole trouble. The State had established one monopoly--the landlord's monopoly of economic rent--thereby shutting off great hordes of people from free access to the only source of human subsistence, and driving them into factories to work for whatever Mr. Gradgrind and Mr. Bottles chose to give them. The land of England, while by no means nearly all actually occupied, was all legally occupied; and this State-created monopoly enabled landlords to satisfy their needs and desires with little exertion or none, but it also removed the land from competition with industry in the labor market, thus creating a huge, constant and exigent labour-surplus.
[Emphasis Nock's]

-- Albert J. Nock, "The Gods' Lookout" February 1934

State land vs. common land

The distinction between common property and state property is lost on royal libertarians. Common property is that to which we all have inalienable rights. State property is that which the state actually owns, and can dispose of as it sees fit. For example, a public right of way is literally a right of way. Under principles of common law, nobody, not even the king, could close a traveled road and make it private property. A state maintenance truck, on the other hand, is state property, which can be sold if it no longer suits state purposes.

The earth, therefore, and all things therein, are the general property of all mankind, from the immediate gift of the Creator.

-- William Blackstone

It is a royal libertarian notion, and not a classical liberal ideal, to treat land as state property, for if land did not rightfully belong to the state, how could the state have granted it to favored citizens?

Classical liberals, not royal libertarians, are the ones who deny the state's right to appropriate the earth and allocate it to privileged individuals on favored terms. Classical liberals also who hold the key to abolishing taxation, by suggesting that the community (not the state) charge a user fee to landholders based on the value of the land.

The ultimate user's fee

Classical liberals recognized that exclusive access to land, and especially to more land than one was using, was a privilege that should be paid for, thereby eliminating the need for taxes. It is not a fee for using land, but a fee for the state privilege of denying use of that land to everyone else.

Men did not make the earth....It is the value of the improvement only, and not the earth itself, that is individual property....Every proprietor owes to the community a ground rent for the land which he holds.

-- Tom Paine, Agrarian Justice (, paragraphs 11 to 15

Another means of silently lessening the inequality of [landed] property is to exempt all from taxation below a certain point, and to tax the higher portions or property in geometrical progression as they rise.

-- Thomas Jefferson, letter to James Madison (, Oct. 28, 1785

Today's land value tax advocates consider graduated land value tax to be unnecessary and problematic, leading to artificial subdivision (and phony subdivision) of land. The point is that Jefferson, to whom libertarians pay homage, considered land monopoly a great evil and land value tax a remedy, as did many other classical liberals:

Both ground-rents and the ordinary rent of land are a species of revenue which the owner, in many cases, enjoys without any care or attention of his own. Though a part of this revenue should be taken from him in order to defray the expenses of the state, no discouragement will thereby be given to any sort of industry....Ground-rents and the ordinary rent of land are, therefore, perhaps, the species of revenue which can best bear to have a peculiar tax imposed upon them.

-- Adam Smith, The Wealth of Nations (, Ch.2, Of the Sources of the General or Public Revenue of the Society), Bk 5, Ch. 2, Pt 1

Suppose that there is a kind of income which constantly tends to increase, without any exertion or sacrifice on the part of the owners: those owners constituting a class in the community, whom the natural course of things progressively enriches, consistently with complete passiveness on their own part. In such a case it would be no violation of the principles on which private property is grounded, if the state should appropriate this increase of wealth, or part of it, as it arises. This would not properly be taking anything from anybody; it would merely be applying an accession of wealth, created by circumstances, to the benefit of society, instead of allowing it to become an unearned appendage to the riches of a particular class.

Now this is actually the case with rent. The ordinary progress of a society which increases in wealth, is at all times tending to augment the incomes of landlords; to give them both a greater amount and a greater proportion of the wealth of the community, independently of any trouble or outlay incurred by themselves. They grow richer, as it were in their sleep, without working, risking, or economizing. What claim have they, on the general principle of social justice, to this accession of riches? In what would they have been wronged if society had, from the beginning, reserved the right of taxing the spontaneous increase of rent, to the highest amount required by financial exigencies?

-- John Stuart Mill, Principles of Political Economy (,Ch.II), Bk 5, Ch. 2

Two different kinds of indirect taxation

One of the most perverted twisting of concepts is reflected in what Hamilton called "indirect taxation." To him, and to many royal libertarians, indirect taxation is "hidden" taxation, as a value-added tax or sales tax that is buried in the price of purchased goods. This kind of indirectness is hardly admirable, and is similar to the kind of indirectness involved in chicanery and duplicity. Small wonder Jefferson called Hamilton a monarchist.

The Articles of Confederation ( embodied an entirely different concept of indirect taxation. The United States was to levy a tax, not on individual property holders, but on each state, based on its aggregate land value. The assumption was that each state would levy a similar tax on each county, and so on down to the individual. In this way, the individual would never have to face a federal tax agent directly, and if the federal government did not have the full support of the states, it could not bully them as easily as it could bully individuals.

Unfortunately, states did not support the federal government to its satisfaction from the beginning (being strapped from the war). Rather than working things out patiently, Hamilton introduced power-centralizing measures into the new Constitution. One was the other kind of indirect taxation, the mosquito-bite kind that you don't see happening. Royal libertarians trumpet this covert taxation as a virtue over direct real estate taxation, even when it means that "free trade" is being taxed.

Socialist Confusions

The classical liberal distinctions between land, labor and capital ( were greatly confused by socialists, and particularly Marxists, who substituted the fuzzy abstract term, "means of production," for all three factors. They also blurred the distinction between common property and state property, for socialists believed, as royalty also believed, that they were the people.

Today, the confusions between land and capital and between state property and common property are shared by socialists and royal libertarians, and only classical liberals keep these distinctions clearly defined. Yet royal libertarians frequently duck the land issue by charging that it is the classical liberals, not the royal libertarians, who have embraced socialist ideas.

Blocking Locke

John Locke ( V.) is often misrepresented by royal libertarians, who quote him very selectively. For example, Locke did say that:

Whatsoever then he removes out of the state that nature hath provided, and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property.

But Locke condemned anyone who took more than he needed as a "spoiler of the commons":

...if the fruits rotted, or the venison putrified, before he could spend it, he offended against the common law of nature, and was liable to be punished; he invaded his neighbour's share, for he had no right, farther than his use called for any of them, and they might serve to afford him conveniences of life.

The same measures governed the possession of land too: whatsoever he tilled and reaped, laid up and made use of, before it spoiled, that was his peculiar right; whatsoever he enclosed, and could feed, and make use of, the cattle and product was also his. But if either the grass of his enclosure rotted on the ground, or the fruit of his planting perished without gathering, and laying up, this part of the earth, notwithstanding his enclosure, was still to be looked on as waste, and might be the possession of any other.

Locke also restricted appropriation of land by the proviso, ignored by royal libertarians, that there must be

still enough, and as good left; and more than the yet unprovided could use. So that, in effect, there was never the less left for others because of his enclosure for himself: for he that leaves as much as another can make use of, does as good as take nothing at all.

Now if the situation is that there is enough free land, and as good, left after you take and cultivate your land, than your land has no market value, for who would pay you for land that is not better than land that can be had for free? So, besides the fact that Locke's justification of privatizing land is far more limited than royal libertarians portray it to be, it is irrelevant to the question of land value tax, as it applies only to land that has no value.

Furthermore, Locke based his scenario on pre-monetary societies, where a landholder would find that "it was useless, as well as dishonest, to carve himself too much, or take more than he needed." With the introduction of money, Locke noted, all land quickly became appropriated. Why? Because with money, those who can take more land than they have personal use for suddenly have reason to do so, as between them they will have taken all the land, and others will have to pay rent to them. So, with the introduction of money, the Lockean rationale for landed property falls apart, even according to Locke. And while Locke did not propose a remedy specifically for to this problem, he repeatedly stated that all taxes should be on real estate.

The tragedy of the common misunderstanding

In their search for excuses to deny any common right to land, royal libertarians are fond of citing Garrett Hardin's work, "Tragedy of the Commons." Or at least they cite the title, which is all most royal libertarians are familiar with. Hardin is himself an advocate of land value taxation, and has criticized misinterpretations of his work with the lament that "The title of my 1968 paper should have been "The Tragedy of the Unmanaged Commons.'" [Emphasis Hardin's]

Thoughtful Libertarian Party leadership

Fortunately, the bias toward royal libertarianism has been shaken off by many of the philosophical leaders of the party. Founder David Nolan ( supports land value tax as the only tax that does not fall on productivity, and the late Karl Hess often described land value tax as the one tax to levy until the state could be abolished entirely. It is mostly the von Miseans, the Objectivists, and the wishful thinkers who adopt the royal rationalization that they can hoard all the land to themselves with impunity.

The red, red herring

Royal libertarians are fond of confusing the classical liberal concept of common land ownership, particularly as espoused by land value tax advocate Henry George, with socialism ( Yet socialists have always been contemptuous of George and of the distinction between land monopoly ( and capital monopolies. However, Frank Chodorov and Albert J. Nock (the original editors of The Freeman) were both advocates of George's economic remedies as well as lovers of individual liberty.

The only reformer abroad in the world in my time who interested me in the least was Henry George, because his project did not contemplate prescription, but, on the contrary, would reduce it to almost zero. He was the only one of the lot who believed in freedom, or (as far as I could see) had any approximation to an intelligent idea of what freedom is, and of the economic prerequisites to attaining it....One is immensely tickled to see how things are coming out nowadays with reference to his doctrine, for George was in fact the best friend the capitalist ever had. He built up the most complete and most impregnable defense of the rights of capital that was ever constructed, and if the capitalists of his day had had sense enough to dig in behind it, their successors would not now be squirming under the merciless exactions which collectivism is laying on them, and which George would have no scruples whatever about describing as sheer highwaymanry.

-- Albert J. Nock "Thoughts on Utopia"

Von Mises misses

Ludwig von Mises acknowledged in several places wholly unique distinctions between land and capital, but in his zeal to denounce land value tax, stated that,

Classical economy erred when it assigned land a distinct place in its theoretical scheme. Land is, in its economic sense, a factor of production, and the laws determining the formation of the prices of land are the same that determine the formation of other forms of production.

Or, paraphrasing Jay Leno, go ahead and buy up the land; we'll make more. The difference between land and capital is huge, and explains why the cost of silicon chips goes down as demand goes up, while the cost of Silicon Valley goes up as demand goes up. There is no natural monopolization of capital, but, with state sanction, there is monopolization of land. But von Mises would sooner obscure these distinctions in socialist fashion than to embrace a proposal he mistakenly thought to be socialist.

In his first edition of Human Action, von Mises attacked land value tax as based on the socialist principle that legitimate property flows only from labor. But that is also a libertarian principle, a classical liberal principle, an Austrian principle, and even the von Misean principle behind private property! So, by the third edition, von Mises changed his text to read that land taxers claim legitimate property flows only from manual labor.

This is much more logically consistent, but factually incorrect. It is a correct assessment of what many socialists believe, but it is not a correct assessment of what land taxers believe. Henry George, the most prominent land taxer of all, wrote in his magnum opus, Progress and Poverty (,

Thus the term labor includes all human exertion in the production of wealth, and wages, being that part of the produce which goes to labor, includes all reward for such exertion. There is, therefore, in the political-economic sense of the term, no distinction as to the kind of labor, or as to whether its reward is received through an employer or not....

George also defended the ownership of property that flows from the employment of capital.

Perhaps von Mises was biased by his location in Europe, where classical liberalism had not fared as well as in America. He might also have first seen land value tax in the Communist Manifesto, and not realized that it was there as a socialist ploy to co-opt support from classical liberalism. (Marx expressed contempt for land value tax as a reform in its own right, and openly stated that his support of it was only to draw people to what he really wanted, which was to control capital.) If this is where von Mises got his first exposure to the idea, it would not be surprising to see him close his mind to it.

Ayn Rand comes sooo close!

Ayn Rand made arguments against perpetual intellectual property that are remarkably similar to arguments against perpetual landed property. She also saw the distinction between land and capital in terms of common vs. private property, but fell back into confusion at other times. She rightly chastised the Encyclopaedia Brittanica's definition of capitalism for confusing land and capital, which she quoted as follows:

Fundamental to any system called capitalist are the relations between private owners of nonpersonal means of production (land, mines, industrial plants, etc., collectively known as capital) [emphasis Rand's]

Then she quoted a John Galt speech in Atlas Shrugged in which Galt stated sarcastically, "A factory is a `natural resource', like a tree, a rock or a mud puddle."

By Jove, I think she's...

But are the heroes of Atlas Shrugged real capitalists? The inventor John Galt is, and perhaps Hank Rearden of Rearden Metals is, too, although one wonders where he got his ore and fuel. But Taggart Railways enjoys extremely valuable right-of-way privileges from the state. (Once land is parceled out, it is virtually impossible to build a railroad without either land value tax or eminent domain.)

Then there is Francisco D'Anconia, who owned the world's richest copper deposits, and who took delight in blowing up his mines and driving the price of copper through the roof--something that would not work nearly as well for a capitalist as for a resource monopolist, as there is no way competitors can make copper ore that doesn't already exist, and, buried or not, D'Anconia's copper ore still belonged to him.

The economics of Galt's Gulch

Most revealing of all is the Randian utopia, Galt's Gulch (, which was financed entirely from, yes, land rents. Midas Mulligan owned the whole place, and was, in essence, the government. All the common services, from Galt's magic energy machine to Hank Rearden's village railroad, to their defense system (some sort of jammer that made the valley invisible to passing planes) were financed from ground rents collected by Mulligan from the landholders. Although politically Galt's Gulch was a monarchy, economically it was a Georgist Single-Tax community, with all community services paid for from the rent of land.

Who has the authority to collect land rent?

Many libertarians struggle with the legitimate question of how any governing body achieves rightful jurisdiction in a community, and we join them in opposing collection by such super-statist organizations as the United Nations, which is substantially a federation of tyrannies. However, royal libertarians raise the question selectively and rhetorically in regard to community collection of land rents. They acknowledge that there must be courts to settle, among other things, property disputes. It seems rather obvious that whatever entity has authority to rule on who gets the land also has authority to rule on who gets the land rent.

Fear of a funded government

There is also a well founded libertarian concern that land rent could provide funds enough to support a corrupt and oppressive government. Most libertarian supporters of the governmental collection of land rent therefore fall into two camps. One would give the people power to limit how much money the government can take, but would stipulate that all such money come entirely from ground rents and natural resource severance royalties. The other would take the full rent, but would stipulate that the government can still only spend what the citizens authorize it to spend. The rest would be distributed on a per-capita basis.

Ending excuses for big government

Much of the government spending to which libertarians strenuously object is made necessary by its taxing productivity instead of land values.

The property tax ( falls mostly on improvements, so less housing is built, giving the government an excuse to build public housing. Profits are taxed, leading to less employment and giving government an excuse to spend money on economic stimulus projects. Family income is taxed to the point that they have difficulty buying a house or sending their children to college, so government institutes subsidized mortgages and student loans.

Even the indirect effects are substantial. Land speculations ( gone sour chew up inner cities, so poor people turn to crime (if drug selling and prostitution be crimes) and the government gets an excuse to beef up the police state.

Politically connected real estate interests see that they can buy up land in the boondocks for a pittance and then get other taxpayers to build them a superhighway, increasing the value of their holdings by orders of magnitude. With land value tax they would have ultimately paid for their own highway or more likely would not have had it built in the first place.

Even welfare increases do not stay in the hands of welfare recipients, but are quickly greeted by higher rent demands from ghetto landlords. (The War on Poverty ( did little to end poverty, but it did a lot to enrich absentee owners of poor communities.)

[Continued... (]


Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on August 23, 2010, 04:04:09 pm (

Sales Tax Destroys Commerce

by Dan Sullivan

Pennsylvania has virtually no shopping malls within 15 miles of Delaware, even though population density in that area is higher than anywhere else in Pennsylvania (and, for that matter, higher than in Delaware). Why the dearth of shopping malls? Because Pennsylvania has a 6% sales tax (7% in Philadelphia), and Delaware has no sales tax at all.

[Continued... (] (

Taxes: 19th-century Sales versus 21st-century Rent

by Fred E. Foldvary
The Progress Report

The sales tax is a 19th-century tax that is becoming ever more unsuited for our global mobile 21st century economy. There is no logical or economic reason whatsoever for taxing sales. Yet there are those who advocate expanding this antiquated tax and forcing high transaction taxes on the global commerce of the internet.

It is unfortunate, and may even be a tragedy, that some USA tax reformers, seeing the evil of the income tax, advocate shifting to a national sales tax. This misguided movement for consumption and sales taxes is splitting the tax-reform movement and diverting energy and time away from realistic and beneficial tax reform.

[Continued... (] (

What it's all about: The Book

The Book, "The FairTax Book", written by right-wing radio talk show host Neal Boortz (, is the basis for and Bible for a recent right-wing cult-like movement to replace the current US tax code with a national sales tax. We suggest you familiarize yourself with it by purchasing or borrowing the book from your local library. We want you to be as informed as possible so that you can make a logical decision based on facts, and not on party loyalty or hype.

We consider the FairTax to be nothing more than a smokescreen for a huge tax cut to the wealthiest Americans and a gigantic tax increase for everyone else to make up for it. As you read, ask yourself what you would get from this plan if it was ever made into law. With critical thinking you will find that the FairTax is not only a lie and a scam, but it will throw many Americans into permanent poverty. We believe the FairTax plan taxes hard work - the sweat of our brows and the toil of our labor - while at the same time it makes free welfare money (inheritances, gifts, and capital gains), that wasn't worked for and wasn't earned, completely tax free.

The FairTax increases the size of government making all who sell or trade part of the Big Brother network. This new tax bill gives the government additional powers to rule the poor and literally grants additional rights to the wealthiest people in America. George Orwell would have been proud.

The FairTax is ANTI-FAMILY. The FairTax penalizes poor families for buying food, clothes, shelter, and medical care by taxing all the basic necessities of life. These things are NOT taxed right now (and shouldn't be) but they ARE HEAVILY TAXED under the FairTax plan. Remember this when you get barraged by a FairTax supporter that says the prebate will give you a portion of this additional tax back and you should be grateful to the new Big Brother Government for giving you anything back. The FairTax bill penalizes those who live paycheck to paycheck taxing every dollar spent to make ends meet while UN-TAXING the rich and wealthy who live off of inheritances, trusts, gifts, and old money.

[Continued... (] (


By Claire Wolfe & Aaron Zelman

“Abolish the IRS!”

So goes the cry. And who could disagree? The income tax is unAmerican in the most profound way, punishing people for being successful. The tax code is vast and incomprehensible. The agency that enforces it is universally loathed.

Yes, let's abolish the IRS. And the income tax.

Unfortunately, the statement that usually comes next begins, “And replace it with ...” And there a new round of troubles begin.

Over time, proposals have included replacing the graduated income tax with a flat tax, a VAT (value added tax), or some form of consumption tax. For several years now, the buzz has been growing for a national sales tax. While other “abolish the IRS” reforms have languished, the national sales tax has, as they say, developed legs.

The most durable proposal for a national sales tax – called the FairTax – is promoted by an organization called Americans for Fair Taxation (AFT) ( A bill to implement that tax (H.R. 25; Senate Bill 1943)(1) was introduced in Congress early in the 108th Congress. The so-called “Fair Tax Act” has 54 co-sponsors as of this writing, plus the outspoken support of both Speaker of the House Dennis Hastert and House Majority Leader Tom DeLay. President George W. Bush expressed cautious support for the act in response to a pre-screened questioner at one of his campaign events. In his acceptance speech at the 2004 Republican Party convention, Bush strongly advocated a total revamp of the U.S. tax system. Although he made no specific proposal, his language was similar to that of the FairTaxers. And at the moment, the FairTax is the only serious tax-revamp proposal on the Congressional table.

Finally, many, many ordinary freedom-loving people, weary of the present outrageous system, are cheering the FairTax as a great improvement.

But it's not.

The FairTax is not only not an improvement. We believe it's UnFair, dangerous, and a disaster in the making.

[Continued... (]

Title: Fair tax is a trap: Demand NO vote on H.R. 25
Post by: Geolibertarian on August 23, 2010, 04:05:04 pm (

Fair tax is a trap: Demand NO vote on H.R. 25

Devvy (
August 9, 2010

The other night on the boob tube I caught a commercial featuring a talk show host named Neal Boortz, Michael Reagan (adopted son of former president, Ronald Reagan) and the vile Newt Gingrich. All pushing for another dangerous taxing scheme that will not cure the cancer, only continue to feed the beast.

Boortz has been on this “fair” tax bandwagon for years. It’s obvious he has zero understanding of the Federal Reserve and why such a taxing scheme would only continue to steal the fruits of our labor to fund massive government spending.

Michael Reagan is also a talk show host who, like Boortz, has zero understanding of our monetary system ( and its feeding artery: the IRS.

Newt Gingrich sold out this country decades ago with his votes. Besides being a serial adulterer ( and ethtically bankrupt, Newt Gingrich is the global master’s trophy boy. He hopes the Republicans take control of Congress in November because there’s no doubt in my mind, Gingrich is out to be president of these united States of America. We can never let that happen. Do you know Newt was caught on tape saying the ridiculous “Contract with America” was nothing but a PR tool for incoming freshmen members of Congress? Yes, that’s a fact. They were obtained by Roll Call. Old Newt pulled a fast one on faithful conservatives. His votes killed MILLIONS of jobs and sent them south of the border and overseas.

In order to understand why H.R. 25 is just another tool of tyrants, you have to go back and see where and when the problem started. Prior to 1913, we had no federal income tax. There was no unconstitutional “Federal” Reserve ( Banking system and there was no Seventeenth Amendment. This nation thrived in agriculture, manufacturing and industrial output.

The shadow government that has been controlling Congress for almost a hundred years had the downfall of America well planned. First, an income tax to syphon off the fruits of our labor. Even though the Sixteenth Amendment wasn’t legally ratified and did not give Congress any new power of taxation, we all know what that Gestapo criminal syndicate will do to you if you don’t voluntarily submit (with a gun to your head) to looting your earnings.

Full article here (

Title: Make Labor Day Real: Untax Wages!
Post by: Geolibertarian on August 23, 2010, 04:08:07 pm (

Make Labor Day Real: Untax Wages!

by Fred E. Foldvary
The Progress Report

In the United States, the holiday honoring workers is Labor Day, which falls on the first Monday in September. This year, 2003, Labor Day is September 1. Elsewhere in the world, May 1 is a common labor holiday.

Why is labor so celebrated, and why is labor not really honored? Why is labor feted in form, but little honored in substance? Why do those who decry the oppression of labor fail to advocate the reform that would best benefit labor?

Labor union leaders want legislation requiring workers in particular industries to be union members. They want the state to enforce picket lines and strikes. They seek laws mandating minimum wages, double pay for overtime work, pay for parental leave, and unemployment insurance. But the one law they do not call for is the abolition of taxes on wages.

Those who fancy themselves to be "progressive" complain about the flight of jobs to foreign countries. They criticize the government for high unemployment. They rally against sweatshop labor. They blame corporations for the exploitation of labor. But I never hear them call for the elimination of taxes on wages.

The single most important reform that labor would benefit from is to have wages free of all taxes. That includes not just income taxes on wages earned but also the taxation of wages when they are spent; value-added and sales taxes are just as much takings from wages as taxes on income. If you have to pay $10 to be in a room, it does not matter whether you have to pay the $10 when you enter or leave the room. The bottom line is that you have paid $10.

Governments all over the world tax labor heavily. It is as though labor were some kind of crime or evil that has to be punished. Taxing wages does not just reduce the take-home pay of the worker. Part of the cost is also borne by the employer. If the supply of labor were completely fixed and rigid, labor would bear all the tax. But in fact, with higher wages, more people want to work. So employers cannot arbitrarily lower the wage offer; they will not get enough labor if the wage they offer is too low. So some of the tax on labor is paid by employers as higher labor costs. They must offer somewhat higher wages to get the labor they need.

The cost of taxes on wages is shared by the employer and the employee. There is a tax wedge between the cost of labor to the employer and the net wage kept by the worker. Labor is made more expensive while workers have lower after-tax wages. With higher labor costs, there is less employment, less production, less investment, less growth, and more poverty.

The wage tax is the source of almost all the evil that befalls labor. The self-employed also must pay a wage tax. A self-employed worker implicitly pays himself a wage out of his profit, since if he were employed by another, he would earn that wage. The opportunity cost (, the best wage foregone by not working for someone else, is the wage that a self-employed worker pays himself. Taxes on wages create a barrier to self-employment, reducing the options of workers who work for companies. It is easier for a boss to exploit labor if the workers cannot easily quit and be self-employed. Barriers to self-employment skew power to employers.

Besides the obvious, explicit taxes on wage, there are also hidden taxes that are substantial even if not apparent. Out of his wage the worker must pay rent for his dwelling. Land values and site rents get pumped up because the financing for public works come from wages rather than land rent ( A worker-tenant gets implicitly taxed again when he pays a higher rental for his dwelling because his landlord is being subsidized in the form of higher land rent.

But that's not the end of it. The rent subsidy to landowners incites them to buy more land, and speculative demand adds to the user demand. Land prices get driven up so high the worker must live far from work in the urban fringes and then commute long distances. The worker is taxed again. We have taxed-again workers, taxed again and again and again.

Taxes on wages are not just bad economics. The wage tax is a moral evil. A worker has a moral right to his own body, time, skills, and life. If not, he is a slave. Therefore, a worker has a moral right to the products and earnings of his labor. The taxation of wages is therefore an evil theft of his labor.

The majority of the people in all countries are workers. The best policy for workers to elevate wages, reduce unemployment, increase worker security, and improve labor conditions is to eliminate taxes on wages. The ultimate resources are land and labor, so the ultimate tax is on land and labor. If taxes there must be, to untax labor, we must shift all taxation to land rent.

Why is it that we see unions and progressives demand more money wages from employers, but not the shift of taxes from wages to rent? Why is the wrath of labor directed to their employers and not to their government representatives who tax their wages away?

If taxation were shifted from wages to rent, there would be a loss of land value to the owners of the most valuable real estate, commercial and industrial land. To protect their interests, the landed interests indoctrinate the masses to think that the conflict is between labor ( and capital ( They tuck land into capital and mask rent in profits and interest ( Faced with high housing costs, people seek subsidies, which further pump up land values at the expense of wages.

But labor advocates can't see beyond the immediate appearances, the companies which hire workers. They don't look beyond treatments of effects. They can't be bothered to investigate ultimate causes.

If we want to be honest, we should change "Labor Day" to "Landowner Day," because labor policy benefits land owning instead of labor, and labor leaders do little to change this. Have a happy Landowner Day!

Title: Value-Added Tax (VAT)
Post by: Geolibertarian on August 23, 2010, 04:21:57 pm
Since ruling-class minions are fond of promoting the value-added tax (VAT), and since most Americans seem to know little if anything about this horrendous tax -- and thus how it compares with other taxes -- I thought I’d start off by posting the following excerpt (all emphasis original):


“One proposal is to substantially reduce or replace personal and corporate income taxes with a tax on consumption. One such tax is the value-added tax (VAT), which is like a retail sales tax except that it applies only to the difference between the value of a firm’s sales and the value of its purchases from other firms. For example, Intel would pay the VAT—say, 7 percent—on the difference between the value of the microchips it produces and sells and the value of the materials used to make the chips. Compaq, IBM, and other firms which buy the chips and other components to make personal computers would subtract the value of these materials from the value of their sales of personal computers. They would then pay the 7 percent tax on that difference—on the value they added.

“Economists reason that since the VAT would apply to all firms, sellers could shift their VATs to buyers in the form of higher prices without loss of sales to other firms. Final consumers, who cannot shift the tax, would end up paying the full VAT as 7 percent higher prices. So a VAT would amount to a national sales tax on consumer goods.”

-- Campbell R. McConnell & Stanley L. Brue, Economics, 14th ed., pp. 657-8


There’s a widely propagated myth concerning the VAT that is revealed in the above quote:

“Economists reason that since the VAT would apply to all firms, sellers could shift their VATs to buyers in the form of higher prices without loss of sales to other firms.”

The establishment economists who employ this argument are obviously counting on the gullible masses to ignore or overlook the obvious questions it begs: If, due to the VAT-caused spike in prices, retail stores experienced a consequent drop in sales, wouldn’t this force them to reduce how much they purchase from the producers of what they’re attempting to sell? And wouldn’t that, in turn, trigger the very “loss” in sales -- and hence in available “investment” dollars -- from which the process of “shifting” the VAT to consumers would allegedly protect mining, agricultural and manufacturing firms?

One doesn’t have to have a degree in economics to see clearly that the answer to both questions is a resounding “yes!”

So we see that, contrary to popular belief, the VAT penalizes and discourages not just “consumption,” but production as well. It is a tax on -- as Robert De Fremery ( would put it -- the “privately created values” of labor and capital goods (“capital (” for short). Only in the Orwellian fantasy world of economic snake-oil salesmen can such a tax be imposed without penalizing production as well as consumption, and without reducing (consequently) the ability of the average firm to invest in production.

Bottom line: like the ridiculous carbon tax (, the VAT is just one more glorified way of taxing labor and capital to death while leaving publicy-created land values largely untaxed -- all so overprivileged landlords, slumlords and banklords can continue to quietly parasitize both wage-earners and productive entrepreneurs through systematic rent-gouging.

Ever notice how you never hear that particular assessment from either Keynesians ( or Austrians ( And on the issue of monetary reform, ever notice how both groups -- despite being supposed “opposites” -- seem equally opposed (albeit for different reasons) to debt-free Greenbacks (

If so, why do you suppose that is?

Could it be that Democrat-vs.-Republican is not the only “false paradigm” within which countless people have allowed their minds and intellects to be literally enslaved via elite-funded propaganda campaigns? Could the reason why Austrians obsessively attack Keynesians -- and vice versa ( -- be that each group must rely heavily upon the other’s fatally flawed agenda as comparative foil against which to define its own, lest the masses they’re trying desperately to dupe notice the respective flaws in each?

Read the following and decide for yourself: ( ( (

Title: Banker-owned Obama administration may impose VAT tax
Post by: Geolibertarian on August 23, 2010, 04:29:27 pm (

Bankers Prepare To Assault Americans With VAT, Transaction Taxes

Obama: Value-added tax still on the table despite White House assurances otherwise, campaign promise not to raise taxes for families earning under $250,000 a year

Paul Joseph Watson
Thursday, April 22, 2010

The global banking elite are preparing to assault Americans with two huge new tax increases as President Obama contradicts the assurances of White House aides and his own campaign trail promise by asserting that a VAT tax is still on the table, as the IMF outlines a new tax on financial transactions that is being hailed as a blow to the banks yet represents another stealth tax on the people.

“President Barack Obama suggested Wednesday that a new value-added tax on Americans is still on the table, seeming to show more openness to the idea than his aides have expressed in recent days,” reports the Associated Press (

Obama’s signal that he may embrace a European-style VAT tax follows former Fed chairman Paul Volcker’s call for a value-added tax ( In response, the U.S. Senate passed a nonbinding “sense of the Senate” resolution labeling any such move, “a massive tax increase that will cripple families on fixed income and only further push back America’s economic recovery.”

Not happy with hitting Americans with a roughly 20% increase in living costs that a VAT tax would impose, Volcker also called for a carbon tax in the name of solving the widely discredited scam of man-made global warming, a new levy that is already being introduced at the state level (

Despite the fact that White House aides dismissed the prospect of a national sales tax only on Monday (, Obama’s u-turn once again contradicts his pre-election promise that he would not raise taxes for American families earning under a quarter of a million dollars a year.

During a speech on the campaign trail, Obama promised, “No family making under $250,000 dollars a year will see any form of tax increase.” (

However, the VAT tax is a flat rate levy that applies to everyone, and it will dramatically increase the cost of living for Americans already laboring under the greatest financial meltdown since 1929. As CNS News highlights (, VAT is also labeled “consumption tax, because it applies to items at every stage of production. Such a tax would affect purchasers at all income levels.”

Obama’s failure to keep his promise that families would not “see any form of tax increase” has force him to lie in public addresses and claim that he only ever promised not to increase income tax on families earning under $250,000.

“And one thing we have not done is raise income taxes on families making less than $250,000,” Obama said on April 10. “That’s another promise we’ve kept.”

As CNS News’ Fred Lucas points out, in addition to any future VAT tax, “The $1-trillion health care overhaul bill contains at least 12 taxes and fees that will affect households earning less than $250,000.”

In our special report on tax increases contained in the Obamacare bill (, we identified dozens of tax increases, most of which would apply to families making under $250,000 a year.

[Continued... (] (

Obama Debt Czar Says Tax Hikes “On The Table”   

Paul Joseph Watson
Monday, April 26, 2010

The Democratic co-chairman of President Obama’s debt commission, Erskine Bowles, told Fox News Sunday that tax hikes for Americans are “on the table,” despite Obama’s election campaign promise that no individual earning under $200,000 dollars a year would be hit with any tax increases.

Asked if he felt bound by the President’s pledge, Bowles responded, “Everything is on the table, we’re going to look at every single way to right this fiscal ship….raising revenue, we have to have everything on the table.”

Bowles also said that a European-style VAT tax, which would increase living costs by as much as 25 per cent, was also under consideration.

“I think that there are many good arguments that you could make for a value-added tax or a consumption tax as oppose to a tax on wages but I think it’s just one of the things that ought to be on the table that we ought to discuss.” (

Bowles’ suggestion that a VAT tax would supplant or be offset by a reduction in income tax is likely a ruse. People in Europe pay the highest levels of income tax in the world but they are also forced to pay VAT on most goods at a level between 15-25 per cent in addition to costly income tax rates.

VAT taxes are typically introduced at low rates in order to dampen opposition, but then gradually raised over the course of decades. For example (, Denmark’s VAT tax started at 9 per cent in 1962, but today has bloated to a whopping 25 per cent.

The 18 members of the debt commission will unveil their plan by December 1.

The prospect of income tax hikes contradicts Obama’s pre-election promise that he would not raise taxes for American families earning under a quarter of a million dollars a year.

During a speech on the campaign trail, Obama guaranteed, “No family making under $250,000 dollars a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”

“You will not see any of your taxes increase one single dime,” Obama repeatedly vowed.

As we have highlighted (, even aside from any income tax hikes, Americans already face a myriad of tax increases under Obamacare, a potential VAT tax, not to mention a future consumption tax based on CO2 emissions.

As the Associated Press reported On April 1 (, the largest ever increase in tobacco tax, and one that would disproportionately affect the poor, was passed by Obama despite his pledge to protect lower earners.

Last week, Obama himself said that a value-added tax, which would hit Americans across the income bracket but particularly the poor and struggling middle class, was “still on the table” just days after White House aides had assured otherwise.

Title: The carbon tax
Post by: Geolibertarian on August 23, 2010, 04:34:16 pm
There's been much talk in recent years about the so-called carbon tax. The economic snake-oil salesmen who shamelessly peddle this ridiculous scheme routinely claim that it will "curb emissions" while helping to "strengthen" our economy. Now, since it is the wealth ( process of applying labor ( and capital ( to land ( that generates much of the man-made carbon ( emissions that global warming ( cultists incessantly wax alarmist about, what the aforementioned salesmen are essentially claiming is that -- even though labor and capital are taxed to death already -- if we tax them even more, that will magically improve our collapsing economy. 

The truth, of course, is the very opposite:

------------------------------------ (

Kerry – Lieberman: Corrupt Climate Science Used To Destroy US Economy

Dr. Tim Ball
Canada Free Press
May 18, 2010

The Kerry – Lieberman American Power Act (APA) is a disastrous, unnecessary solution for a non-existent problem. Worse, it’s a problem that exists only in a grossly inadequate computer model whose projections have never been correct. It is predicated on the false assumption that an increase in CO2 causes a temperature increase. Every record of any duration for any period in Earth’s history shows temperature increases before CO2 increases.  The false assumption is the basis of all global warming and climate change used in the corrupted research and models of the Intergovernmental Panel on Climate Change (IPCC). It is impossible to imagine such an unjustified basis for any action, except to undermine the US economy for political gain.

It will make the US economy uncompetitive, dramatically increase the cost of living and give more power to the government. This is already proven in the failure of countries that have pursued similar alternative energies and green economies.

The name of the Act is in the deceptive tradition of climate-based energy policy. It was carbon credits, then carbon tax, cap and trade, and now the APA but they are all the same and completely unnecessary.  Carbon credits were designed as a global equalization of wealth. Developed nations had to pay for the sin of making their money by using fossil fuels and producing the planet destroying global warming. Cap and Trade appeared virtuous by capping the planet-destroying CO2 while creating trade and business opportunity. It is actually the same old tax grab with more government control. The APA invokes patriotism and implies energy independence, especially from oil. The spill in the Gulf is unfortunate but has reinforced the push. As Rahm Emmanuel, White House Chief of Staff said (, “Never let a serious crisis go to waste.”

The IPCC Provide Corrupt Scientific Basis

It provides the leverage to achieve the stated Obama administration goal of energy independence and a shift to alternative energy. However, it is much more than that because as Richard Lindzen ( said “Controlling carbon is a bureaucrats dream. If you control carbon you control life.”

The IPCC Reports and especially the Summary for Policymakers (SPM) are used to demonize CO2. Ironically, they provide evidence of how inadequate they are for taking such dramatic, drastic and unnecessary political action.

In the Reports what is initially included and then excluded tells the story. For example, a graph (Figure 1) showing the Medieval Warm Period (MWP) was included in the 1990 IPCC Report. It was a problem for Michael Mann and the Climatic Research Unit (CRU) so it disappeared in later reports and then was replaced in the 2001 Report by the corrupted ‘hockey stick’ graph, as they rewrote history.

[Continued... (] (

Will The New Green Economy Kill The American Dream For Millions Of People?

The American Dream
May 21, 2010

As Barack Obama and U.S. Senators John Kerry and Joe Lieberman continue to try to ramrod a "green economy bill" ( down the throats of the American people, many Americans are openly wondering what this new green economy is going to cost all of us. After all, two new reports have just come out that clearly indicate that “climate change legislation” is really, really bad for an economy. In fact, many are projecting that the cap and trade system that Barack Obama and the Democrats wish to impose on all of us will end up killing the American Dream for millions of people. At a time when the U.S. economy is already coming apart at the seams, the last thing we need is another huge mountain of oppressive regulations heaped on to American businesses. This is especially true considering the fact that global corporations have already shown that they will ship manufacturing jobs out of the United States at the drop of a hat. The reality is that the new green economy is not going to be good for any of us, and the American people need to wake up to that fact.

First of all, before we explore the economic dangers of this new green economy, we should make it clear that carbon dioxide simply does not cause global warming.

Dr. Tim Ball, a renowned environmental consultant and former climatology professor at the University of Winnipeg, has studied this for years and he says that it abundantly clear that carbon dioxide cannot possibly cause “global warming” (….

“CO2 is about 1.5 the density of air. One of the great fallacies promoted by [the proponents of the global warming theory] is that CO2 is well and quickly mixed through the atmosphere. It isn’t. They also argue that the CO2 is most effective in trapping heat from the Earth (infrared) at the top of the atmosphere. This is why the computer models predicted greatest warming at the top of the atmosphere over the tropics. The problem is the actual measurements show that is not happening.”

The truth is that carbon dioxide is one of the fundamental building blocks of life. In fact, scientists tell us that there were times in the earth’s past when there were much, much higher concentrations of carbon dioxide in the atmosphere than there are now. When there is more carbon dioxide, plant life thrives and there is more food for everyone.

But the environmentalists just won’t listen. It is as if nothing will shake their blind faith in global warming. But the facts are out there for anyone with an open mind. For much more on the fraud of “global warming”, just check out the following article: “How To Save The Environment? Get Al Gore The Heck Away From It” (

In fact, even if we eliminated every single source of carbon dioxide emissions caused by humans, it would hardly make a dent in total worldwide carbon emissions. Over 95% of total carbon dioxide emissions would occur even if humans were not present on Earth.

So those who are trying so hard to reduce carbon dioxide emissions in order to “save the environment” are chasing after some sort of a fantasy.

That wouldn’t be so bad if their delusions weren’t about to crush the U.S. economy.

Analysts are calling this new green economy bill in the U.S. Senate a “job killer” that would push energy bills through the roof and would drive jobs and businesses overseas at a record pace.

So is there any evidence that those things would actually happen?

Well, yes there is.

*A leaked internal assessment produced by Spain’s Zapatero administration reveals that Spain’s “green economy” has been an absolute economic nightmare ( for that nation. Energy rates in Spain have “skyrocketed” and the new green economy there has lost more than two jobs for every job that it has created. All of this has pushed Spain to the brink of economic disaster. In fact, economists all over the world say that Spain is now one of the nations most likely to experience a Greek-style financial collapse.

*According to a new study by the California Legislative Analyst’s Office, a state law that requires power plants, factories and other businesses to cut greenhouse gas emissions could cause energy prices to rise and prompt businesses to delay expansion or flee California (,0,5231198.story?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fbusiness+%28L.A.+Times+-+Business%29&utm_content=Google+Reader).

Not that this should be shocking for anyone.

[Continued... (]


Title: Cap and Trade: A Gigantic Scam
Post by: Geolibertarian on August 23, 2010, 04:36:16 pm (

Cap and Trade: A Gigantic Scam

by Washington's Blog
Global Research, May 23, 2010
Washington's Blog - 2010-05-22

As I pointed out ( in December:


According to James Hansen - the world's leading climate scientist fighting against global warming - in a interview on Democracy Now that cap and trade not only won't reduce emissions, it may actually increase them:

    The problem is that the emissions just go someplace else. That’s what happened after Kyoto, and that’s what would happen again, if—as long as fossil fuels are the cheapest energy, they will be burned someplace. You know, the Europeans thought they actually reduced their emissions after Kyoto, but what happened was the products that had been made in their countries began to be made in other countries, which were burning the cheapest form of fossil fuel, so the total emissions actually increased...

See also this ( and this (

Environmental groups such as Friends of the Earth and Greenpeace ( are also against cap and trade (and see this ( and this (, as is the head of California's cap and trade program ( for the EPA.

Hansen also told Goodman that (notwithstanding Paul Krugman's assertions) most economists say that cap and trade won't work:

    I’ve talked with many economists, and the majority of them agree that the cap and trade with offsets is not the way to address the problem.

As I have previously pointed out:

*  The economists who invented cap-and-trade say ( that it won't work for global warming

*  European criminal investigators have determined ( that there is a tremendous amount of fraud occurring in the carbon trading market. Indeed, organized crime has largely taken over ( the European cap and trade market.

*  Former U.S. Undersecretary of Commerce for Economic Affairs Robert Shapiro says ( that the proposed cap and trade law "has no provisions to prevent insider trading by utilities and energy companies or a financial meltdown from speculators trading frantically in the permits and their derivatives."

*  Our bailout buddies over at Goldman Sachs, JP Morgan, Morgan Stanley, Citigroup and the other Wall Street behemoths are buying heavily into carbon trading (see this (, this (, this (, this (, this (, this ( and this ( As University of Maryland economics professor and former Chief Economist at the U.S. International Trade Commission Peter Morici writes (

    Obama must ensure that the banks use the trillions of dollars in federal bailout assistance to renegotiate mortgages and make new loans to worthy homebuyers and businesses. Obama must make certain that banks do not continue to squander federal largess by padding executive bonuses, acquiring other banks and pursuing new high-return, high-risk lines of businesses in merger activity, carbon trading and complex derivatives. Industry leaders like Citigroup have announced plans to move in those directions. Many of these bankers enjoyed influence in and contributed generously to the Obama campaign. Now it remains to be seen if a President Obama can stand up to these same bankers and persuade or compel them to act responsibly.

In other words, the same companies that made billions off of derivatives and other scams and are now getting bailed out on your dime are going to make billions from carbon trading.

One the largest boosters for cap and trade invented credit default swaps ( - which were supposed to increase financial stability, but instead were a large part of the reason that the world economy crashed last year.


Jeanne Roberts provides ( an update at environmental website Celsius:

    The E.U. carbon emissions trading fraud is huge, but perhaps nothing compared to the potential for cheating that will become available in the United States once Waxman-Markey, or some similar scheme for reducing carbon emissions, emerges from the Senate to become law.


    As Bloomberg notes, a carbon trading market organized around derivatives (sometimes known as credit default swaps, or CDS) is “open to manipulation,” in the words of billionaire hedge fund investor George Soros.

    In fact, some old-school environmentalists see the whole carbon trading scheme as not a way to curb climate change, but merely a way to make the rich even richer at the expense of the rest of us. As Larry Lohmann, the founding member of the Durban Group for Climate Justice, says, “Dishonesty is rife throughout the carbon offset market.”

    In January, investigators from Belgium said that in some E.U. countries, 90 percent of the market volume in carbon trading was based on criminal activities.

© Copyright Washington's Blog, 2010

Title: Obama Plans To Sneak Through Carbon Tax By Stealth
Post by: Geolibertarian on August 23, 2010, 04:38:15 pm (

Obama Plans To Sneak Through Carbon Tax By Stealth

Job killing, economy wrecking, middle class destroying consumption tax to be added in lame duck session after November elections


Paul Joseph Watson
Friday, June 18, 2010

President Obama is planning to sneak through his job-killing, economy wrecking carbon tax by stealth according to the Washington Post, by passing a weakened bill and then adding in cap and trade provisions after the heat is off following the November elections.

Described as the “lame duck climate strategy,” Obama is planning to secure enough votes in the Senate to pass a weakened energy bill and then drag out the conference long enough to ensure the stronger provisions contained in the original House version are added “after lawmakers have faced voters in November, thereby cushioning the vote’s political impact.”

“Several sources familiar with the administration’s thinking confirmed it has started pressing Senate Majority Leader Harry Reid (D-Nev.) to bring up a slimmed-down energy and climate bill next month. Such a measure would pass more easily than a comprehensive climate bill, and could still be negotiated with the broader bill the House passed a year ago,” reports the Washington Post (

Knowing that the “energy bill” represents nothing less than another massive plunder of the American taxpayer and is widely unpopular, Senators will only stab their constituents in the back and vote for the more nightmarish aspects of the legislation, including a tax on the very substance they exhale, after they have secured their seats in November.

As we highlighted last week, plans to impose a carbon tax on American citizens appeared to fade after Republican Senator Lindsey Graham shockingly reversed his views on climate change, telling a press conference that the science behind man-made global warming is in question and those pushing it are alarmists who have oversold the problem.

“The Senate is expected to try and push a watered down bill with the hope of moving towards a carbon tax later on,” we reported on June 10 (, which is exactly the approach now being adopted by Obama.

The elite are still desperate to impose a consumption tax on Americans as part of the move towards a “post-industrial revolution” and the kind of nightmare “green economy” that has left Spain with a 20 per cent unemployment rate. In a so-called green economy, over 2.2 jobs are lost for every “green job” created (

The EPA has been busy floating propaganda about how Obama’s cap and trade legislation would cost Americans an average of $79 to $146 per year. In reality, as we have documented, the stronger provisions of the bill would see around $2.9 trillion shaved off the economy by the year 2050 if enacted. The legislation would also reduce GDP by 6.9 percent ( – a figure comparable with the economic meltdown of 1929 and 1930.

A carbon tax would impact almost every aspect of Americans’ lives, from higher gas prices, to soaring utility bills, to exorbitant excesses related to the “energy efficiency” of their homes. It would be enforced by an army of environmental regulators and green police poking their noses into the private affairs of citizens.

The government has aggressively exploited the BP oil spill in the Gulf of Mexico ( to manufacture an artificial urgency in an effort to speed the passage of cap and trade, an agenda firmly supported ( by the transnational oil corporations Obama is claiming to be reigning in. British Petroleum is one of the founding members of the cap and trade lobby (, and has consistently “lobbied for tax hikes, greenhouse gas restraints, the stimulus bill, the Wall Street bailout, and subsidies for oil pipelines, solar panels, natural gas and biofuels.”

Yesterday, White House spokesman Ben LaBolt invoked the oil spill disaster to justify passage of the carbon tax bill.

“The tragedy in the gulf underscores the need to move quickly, and the president is committed to finding the votes for comprehensive energy legislation this year,” said LaBolt.

Obama himself even went to the extreme ( of comparing the oil spill to 9/11, proving that he is perfectly willing to exploit the horror of nearly 3,000 dead Americans in a completely unrelated event nine years ago to underhandedly push his political agenda.

Title: Obama Science Czar Called For Global Carbon Tax
Post by: Geolibertarian on August 23, 2010, 04:39:49 pm (

Obama Science Czar Called For Global Carbon Tax

Underreported 2008 comments were made immediately prior to becoming White House science director

Steve Watson
Thursday, Jul 8th, 2010

Immediately prior to his nomination as White House Science Czar, John P. Holdren called for a global carbon tax in order to “redistribute” wealth to the Southern Hemisphere.


Holdren’s comments were underreported at the time but have since garnered attention in the wake of the Democratic leadership’s new push to pass comprehensive climate change legislation.

Holdren, the director of the White House Office of Science and Technology Policy, made the statement on July 3, 2008 on “Democracy NOW!”, hosted by Amy Goodman.

Holdren said: “It’s important that we have a global agreement on how we are going to limit the emissions of carbon dioxide and other greenhouse gases going forward, and an agreement that will include the tropical forests, that will include ways to transfer some of the revenues from carbon taxes or carbon emission permits in the North to pay for reduced deforestation in the South.”

Watch the video: ( (John Holdren on Redistribution of Cap & Trade Revenue From U.S. to Global South)

Directly echoing Holdren’s comments, Sec. 756(c ) of the most recent climate change legislation being debated in Congress, the Kerry-Lieberman bill, legislates for “international offset credits” to be provided to countries that reduce deforestation.

In addition, Section 5004 would mandate the Secretary of Agriculture, in conjunction with the Environmental Protection Agency, to create a program “to provide assistance to reduce greenhouse gas emissions from deforestation in developing countries, in accordance with this title.”

Holdren argued during the “Democracy Now!” appearance that limits and levies on carbon emissions would create so called “green jobs”.

“The notion that this is going to be unaffordable and an economic catastrophe to address this problem is just wrong,” said Holdren.

However, precisely that scenario has unfolded in Spain, according to its own government. The “green economy” has left the country with a 20 per cent unemployment rate, virtually bankrupt and in need of being bailed out ( by the rest of Europe.

In this so-called “green economy”, over 2.2 jobs are lost for every “green job” ( created.

Electricity prices in Spain have “skyrocketed” ( since the implementation of such policies, according to a leaked government report.

Obama’s green economy bill ( has been laying in wait for almost two years now. However, the president’s stated intention to “Implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050″ has not gone away.

Recent exposure of the fraud behind the climate science driving the global warming movement had seemingly scuppered Obama’s chances ( of pushing through the legislation, which would see some $2.9 trillion shaved off the economy by the year 2050 if enacted. The legislation would also reduce GDP by 6.9 percent – a figure comparable with the economic meltdown ( of 1929 and 1930.

Now, however, in the wake of the BP disaster, and a tightly controlled public relations machine managing it, Obama has seen an opportunity to gain momentum (, once more wheeling out his “clean energy” rhetoric.

Other proponents of a carbon tax have flat out called for the BP disaster to be exploited ( in order to reinvigorate political momentum behind the policy.

Exploiting the catastrophe is necessary to “catalyze support for an American environmental policy with teeth,” writes top elitist and Harvard Professor Kenneth Rogoff, noting that the cap and trade system basically amounts to the same thing as a carbon tax and is just a trick to hide the use of the incendiary word “tax”.

The carbon trading scam has little to do with the environment and everything to do with vast profiteering while actively de-industrializing the developed world. As our previous research highlights (, it is a is a long term policy goal of the global elite.

In his now notorious 1977 book, Eco Science (, John P. Holdren wrote of a need for the U.S. to follow an agenda of “de-development” via “a stable, low-consumption economy”. The book also calls for programs of mass sterilization, one child policies and an authoritative “Planetary Regime” to oversee their implementation.

As we have previously pointed out (, though the catalyst has changed throughout Holdren’s work, the endgame remains the same. In the 70’s, Holdren was busy talking up the drastic threat of global cooling, warning that it would produce giant tidal waves and environmental devastation. Holdren’s convictions about climate change have flip-flopped in order to accommodate whatever scientific fad holds sway at the time, however, his goal of depopulation and de-development remains constant.

Title: Re: Obama Science Czar Called For Global Carbon Tax
Post by: Geolibertarian on August 23, 2010, 04:45:39 pm
Holdren said: “It’s important that we have a global agreement on how we are going to limit the emissions of carbon dioxide and other greenhouse gases going forward, and an agreement that will include the tropical forests, that will include ways to transfer some of the revenues from carbon taxes or carbon emission permits in the North to pay for reduced deforestation in the South.” ....

Directly echoing Holdren’s comments, Sec. 756(c ) of the most recent climate change legislation being debated in Congress, the Kerry-Lieberman bill, legislates for “international offset credits” to be provided to countries that reduce deforestation.

What the eugenics (,394.0.html)-obsessed eco-fascists are counting on the masses to remain blissfully ignorant of is the fact that taxing labor ( and capital ( instead of land values is one of the very two things that caused massive deforestation in the first place:


"It is incontrovertible, I think, that the rapidly-increasing destruction of the Amazon rain directly attributable to the fact that the Amazon basin is the only part of Brazil where free or cheap land is available, and this, in turn, is attributable to the fact that nearly four-fifths of Brazil's arable acreage is covered by sprawling latifundios, half of which are held by speculators ( who produce nothing. Were the artificial scarcity of available land in the rest of Brazil corrected, as the Georgist remedy ( would unquestionably do, pressure ( on the Amazon basin would obviously cease." [Emphasis added]

-- Robert V. Andelson, Commons Without Tragedy (, p. 32


Thus, the eco-fascists who claim that the "solution" to massive deforestation is to tax labor and capital even more via their "cap and trade" scheme (while leaving land values, as always, comparatively untaxed) are no less ridiculous and insane than someone who claims that the only way to "fight" fire is to fuel it.

I'm reminded of what Henry George once wrote ( in reference to the Orwellian "solutions" or "remedies" that political con artists are always peddling to anyone foolish enough to listen:

    "All such remedies begin at the wrong end. They are like putting on brake and bit to hold in quietness horses that are being lashed into frenzy; they are like trying to stop a locomotive by holding its wheels instead of shutting off steam; like attempting to cure smallpox by driving back its pustules."

As to the other primary cause of massive deforestation that eco-fascists don't want anyone to think about (lest they be recognized for the ruling-class minions they really are), that, of coure, is privately-controlled, debt-based money systems (

------------------------------------ (


by John McMurtry, Professor of Philosophy
University of Guelph.

As the wheels come off the global market juggernaut, we need to understand that the unfolding collapse has been programmed into the machine. Stay the course of capital deregulation long enough and a truly momentous wreck is guaranteed. The fact is that our political and market leaderships have ensured no intelligent thought relating to the actual life needs of societies has been listened to for 15 years. "No alternative," they incanted without a break since the Reagan revolution of mindless govenment first began stripping social infrastructures by ever lower tax rates for the rich and 20% compound interest rates on public debt. Even now as the government of France pulls out of the MAI declaration of rights for unaccountable borderless capital, Ottawa is still prating about "sticking to its commitments" to the meltdown program.

The problem is a generalized mind-seizure. As money-to-more-money circuits have become increasingly autonomous, public consciousness has fetishized money demand as the sovereign authority of the world. The lifeblood of societies has been circulated away as fast as possible to "pay off deficits as a national emergency," "reduce social costs to attract investors," "cool down the employment rate to ward off currency devaluation," "deregulate the labour and resource markets economy for greater efficiencies," and so on. The litany for expropriation of societies' common heritage and infrastructure has been recited every hour for almost twenty years, and it has always and everywhere been the disguise for highly leveraged money sequences to feed on the social life substance across the planet.

But even as the meltdown progresses across continents, the unseen seat of the disease is not yet whispered—that money sequences are overloaded far beyond the capacity of social and environmental capacities to feed them, and that they increasingly attack life-serving functions to continue their decoupled cycles.

Because these money sequences are increasingly without productive outcome of any kind, redistribute more and more wealth to the economically parasitic ( while stripping the civil commons and the poor, and progressively demand ever more revenue extraction from social and environmental hosts, their reproduction has become increasingly incompatible with civil and planetary life

The overloading of the life-system by ever more ravenous money sequences is, in truth, behind every crisis people face today in the global market—behind the stressing and breaking of the planetary environment's carrying capacities, behind government debt and deficit loads and crises across the world, behind the ceaseless mergers, acquisitions and job-sheddings by corporate finance departments, behind the speed-ups of every process of work and resource extraction, behind the privatization and enclosure of evolved civil commons in every culture, and behind now the Asian meltdown and the great slump of Japan.

We need not summarize all the symptoms. But consider some figures of money-demand aggregates increasing exponentially on life systems at every level, every new unit of the escalating load requiring "more competitive performance" or "more competitive cost cutting" from individual, social and environmental life-hosts, with no limit set to what will be demanded next.

[Continued... (] (

------------------------------------,379.0.html (,379.0.html) (Monetary Reform)

Title: Leaked G20 Documents Show Carbon Taxes Still High on Globalist Agenda
Post by: Geolibertarian on August 24, 2010, 10:43:34 am (

Leaked G20 Documents Show Carbon Taxes Still High on Globalist Agenda

James Corbett
The Corbett Report
22 July, 2010

This week The Corbett Report ( was sent documents purported to be the notes of an attendee of the recent Toronto G20 meeting. The documents, if genuine, show that the recent meeting once again gave the G20 a chance to discuss global government as an answer to the ongoing economic meltdown and reaffirm that carbon taxes are high on the globalists’ priority list.

The idea of funding a nascent global governmental structure through the introduction of carbon taxes is
by no means a new one.

The notes were obtained from a source inside a South African bank whose CEO was a confirmed attendee of the Toronto meeting. According to the source, they are most likely notes from a feedback session between the CEO and bank officials upon the CEO’s return from the conference.

Download the documents in PDF format via this link (

According to the documents, the delegates concluded that a process of fiscal consolidation would be the key solution to the crisis, involving country-specific ideas with central coordination…presumably by the G20 itself. Although the delegates evidently discussed the need to address the sovereign debt crisis “through cutting expenses and not through increased taxes,” that statement is immediately followed in this attendee’s notes by the idea of introducing carbon taxes.

The idea of funding a nascent global governmental structure through the introduction of carbon taxes is by no means a new one, having been proposed as a funding mechanism for a North American Union ( at a secret Security and Prosperity Partnership meeting in Banff, Canada in 2006.

Perhaps not coincidentally, the idea was last floated in the G20 Finance Ministers’s meeting in Scotland last year. In leaked documents from that meeting ( it was revealed that attendees had seriously discussed the possibility of using a carbon tax to fund an international financial body which would supposedly be entrusted to look after climate adaptation and mitigation programs.

That the carbon tax was discussed during G20 deliberations comes as no surprise. Nor does the fact that the delegates deliberated on the need “to develop Global governance structures” and the desire for “coordination across countries.” The urge to use a manufactured economic crisis to institute a new international system of governance administered by the very bankers who created the problem in the first place has likewise been noted for years (

[Continued... (]

Title: Globalists Race To Enforce Criminal Carbon Tax
Post by: Geolibertarian on August 24, 2010, 10:44:37 am (

Globalists Race To Enforce Criminal Carbon Tax

$100 Billion A Year Levy Is About Bankrolling Global Government And Lining The Pockets Of Con Artist Oil Men Soros, Strong and Gore, Has Nothing To Do With Saving The Environment


Paul Joseph Watson
Friday, August 6, 2010

Despite the failure of last year’s Copenhagen climate summit, the United Nations is pushing ahead for a global carbon tax that will bankroll the expansion of world government as globalists attempt to make Americans pay for the evisceration of their own sovereinty and future prosperity.

“Carbon taxes, add-ons to international air fares and a levy on cross-border money movements are among ways being considered by a panel of the world’s leading economists to raise a staggering $100 billion a year to fight climate change,” reports the Associated Press (

British economist Nicholas Stern called for government regulations to pave the way for a “new industrial revolution….to move the world away from fossil fuels to low carbon growth.”

The panel will present its final proposals to UN Secretary-General Ban Ki-moon in October, a month before the next climate conference meets in Cancun, Mexico.

As was revealed during the Copenhagen negotiations, the global tax that the elite are pushing for will not even go to the UN to fight carbon dioxide, the evil life-giving gas that humans exhale and plants breathe. A leaked document obtained by the London Guardian ( during the summit exposed the fact that the tax will do directly to the coffers of the World Bank, and this revelation led to poorer countries refusing to sign a properly binding resolution on CO2 emissions.

The UN panel’s members include billionaire globalist George Soros, who has been calling for a carbon tax for years. Soros has $811 million of his own money invested in Petrobras, the Brazilian oil company (

The fact that Soros plays both sides of the rigged game emphasizes once again the fact that the carbon tax has nothing to do with saving the environment from the mythical threat of global warming and everything to do with industrialists who own the carbon trading systems getting filthy rich while crucifying U.S. sovereignty at the altar of global government.

With electricity and gas prices set to soar ( following the introduction of a carbon tax, people like Soros and Al Gore (, who are heavily invested in energy companies and also own huge chunks of the carbon trading market (, are set to make obscene profits.

The Chicago Climate Exchange (CCX) has direct ties to both Al Gore and Maurice Strong (, two figures intimately involved with a long standing movement to use the theory of man made global warming as a mechanism for profit and social engineering. Gore’s investment company, Generation Investment Management, which sells carbon offset opportunities, is the largest shareholder of CCX.

Maurice Strong, who is regularly credited as founding father of the modern environmental movement, serves on the board of directors of CCX. Strong was a leading initiate of the Earth Summit in the early 90s, where the theory of global warming caused by CO2 generated by human activity was most notably advanced.

Both Strong and Gore come from the Club of Rome clique, who in their 1991 Report, “The First Global Revolution” openly admitted how they were planning to exploit the contrived hoax of global warming in order to further their agenda.

“In searching for a new enemy to unite us, we came up with the idea that pollution, the threat of global warming, water shortages, famine and the like would fit the bill. All these dangers are caused by human intervention, and it is only through changed attitudes and behavior that they can be overcome. The real enemy then, is humanity itself.,” they wrote (

Massive oil companies like British Petroleum, were amongst the founding members of the carbon trade lobby ( BP has supported the Kerry-Lieberman climate bill and other so-called “green” initiatives every step of the way because, far from acting as a punishment for big polluters, they represent a financial windfall.

Transnational oil companies like British Petroleum ( and Exxon Mobil ( have been amongst the biggest promoters of man-made global warming because they are headed up by globalists who understand that the carbon tax will do nothing to help the environment but will be used to bankroll the implementation of global government while swallowing up whatever deposable income impoverished Americans have left.

The elite are still desperate to impose a consumption tax on Americans as part of the move towards a “post-industrial revolution” and the kind of nightmare “green economy” that has left Spain with a 20 per cent unemployment rate. In a so-called green economy, over 2.2 jobs are lost for every “green job” created. (

A carbon tax would impact almost every aspect of Americans’ lives, from higher gas prices, to soaring utility bills, to exorbitant excesses related to the “energy efficiency” of their homes. It would be enforced by an army of environmental regulators and green police poking their noses into the private affairs of citizens.

The “green economy” is nothing more than a euphemism for an organized effort on behalf of big business and global elite to completely eviscerate the middle class and introduce levies and regulation into every area of our lives.

Title: Globalists Plan to Dismantle Middle Class With UN Tax
Post by: Geolibertarian on October 02, 2010, 09:25:39 am (

Globalists Plan to Dismantle Middle Class With UN Tax

Paul Joseph Watson
Sunday, September 19, 2010


Globalists representing 60 nations will meet at the UN this coming week to push a tax on world financial transactions in the name of solving poverty and climate change, formally launching a massive program to bankrupt the middle class and enrich the coffers of global government.

“Spearheaded by European Union countries, the so-called “innovative financing” proposal envisages a tax of 0.005 percent (five cents per $1,000), which experts estimate could produce more than $30 billion a year worldwide for priority causes,” reports CNS News (

As Ira Stoll, editor of, points out, new taxes always start off small so as to not be resisted by the people forced to pay them, and are then always gradually increased.

“When people suggest taxes, they always start out ‘small,” said Stoll.

“But once the door is opened to the idea of ‘global taxes,’ you can bet they won’t end small. Never mind all the issues about whether development aid actually helps poor countries or just winds up empowering corrupt local dictators and their cronies.”

The call for a global transaction tax arrives in the aftermath of a leaked UN blueprint ( which outlined how elitists plan to re-brand global warming in an effort to dismantle the middle class by instituting a “global redistribution of wealth” via carbon taxes.

The aim is to “limit and redirect the aspirations for a better life of rising middle classes around the world,” in other words to reduce the standard of living for the middle classes in Western Europe and America.

However, as was uncovered during the Copenhagen summit, the program of “global redistribution of wealth” and transaction taxes largely centers around looting the wealth of the middle classes in richer countries and then using that money to bankroll the construction of world government. As the leaked “Danish text” revealed (, the money generated from consumption taxes will go directly to the World Bank, not to developing countries to lower carbon emissions or alleviate poverty.

Under the terms of this proposal, poorer countries will not simply be handed the money pillaged from richer nations, instead they will be forced to accept “green loans” ( in the name of combating climate change, a policy that would land the already financially devastated third world with even more debt, payable to globalist institutions such as the IMF.

Even if you accept that global institutions who have proven to be completely corrupt time and time again should be empowered to steal from the rich and give to the poor, these proposals don’t even do that. This is all about bankrolling the expansion of world government and creating a giant slush fund that will be used to coerce smaller countries into allowing themselves to be ruled and regulated by a global bureaucracy funded by increasingly destitute taxpayers in the west.

We warned that globalists were embarking on a global financial transaction tax back in December ( when Lord Monckton obtained the draft proposals for the Copenhagen summit.

As Monckton revealed at the time, the end game is to, “Tax the American economy to the extent of 2 percent GDP, to impose a further tax of 2 percent on every financial transaction….and to close down effectively the economies of the west, transfer your jobs to third world countries.”

The tax, which was vehemently supported by President Obama in Copenhagen, will cost American families already laboring under the greatest financial collapse for generations at least $3,000 a year just for starters (

There can no longer be any denial that a world government is preparing to plunder the west by enforcing a myriad of different global consumption taxes, from financial levies to a carbon tax which will do absolutely nothing to address real environmental issues and will be used solely to expand the power of the World Bank, the IMF and the United Nations.

Allied to the global tax assault is the newly published IMF strategy document that calls for the implementation of a global currency, called the “bancor” (, which will be pushed through by means of draconian regulatory measures that eviscerate sovereignty rights of nation states and hand complete economic control of the global economy over to a tiny and despotic ruling elite. The “bancor” will hand the IMF the power to manipulate exchange rates and determine the eventual collapse of the dollar.

Massive resistance must be focused around rejecting the institution of global taxes paid to the United Nations and the formation of a global currency otherwise the last tattered shreds of American sovereignty will be flushed down the toilet for good.

Alex Jones contributed to this article.

Title: Thanksgiving Day - the True Story
Post by: Geolibertarian on November 23, 2010, 01:49:49 pm (

Thanksgiving Day - the True Story

by Fred E. Foldvary, Senior Editor
The Progress Report
November 1998

The Thanksgiving Day that millions of Americans celebrate, with turkey and stuffing, is a myth. The true history was forgotten long ago, and even most of the history books have it wrong.

The myth goes like this: The Pilgrims landed in 1620 and founded the Colony of New Plymouth. They had a difficult first winter, but survived with the help of the Indians. In the fall of 1621, the grateful Pilgrims held their first Thanksgiving Day and invited the Indians to a big Thanksgiving-Day feast with turkey and pumpkins.

There was indeed a big feast in 1621, but it was not a Thanksgiving Day. This three-day feast was described in a letter by the colonist Edward Winslow. It was a shooting party with the Indians, but there was no Thanksgiving Day proclamation, nor any mention of a thanksgiving in 1621 in any historical record.

The history of the colony was chronicled by Governor William Bradford in his book, Of Plimouth Plantation, available at many libraries. Bradford relates how the Pilgrims set up a communist system in which they owned the land in common and would also share the harvests in common. By 1623, it became clear this system was not working out well. The men were not eager to work in the fields, since if they worked hard, they would have to share their produce with everyone else. The colonists faced another year of poor harvests. They held a meeting to decide what to do.

As Governor Bradford describes it, "At last after much debate of things, the governor gave way that they should set corn everyman for his own particular... That had very good success for it made all hands very industrious, so much [more] corn was planted than otherwise would have been". The Pilgrims changed their economic system from communism to geoism (; the land was still owned in common ( and could not be sold or inherited, but each family was allotted a portion, and they could keep whatever they grew. The governor "assigned to every family a parcel of land, according to the proportion of their number for that end."

Bradford wrote that their experience taught them that communism, meaning sharing all the production, was vain and a failure:

    "The experience that has had in this common course and condition, tried sundrie years, and that amongst Godly and sober men, may well evince the Vanities of the conceit of Plato's and other ancients, applauded by some of later times; that the taking away of propertie, and bringing into commone wealth, would make them happy and flourishing, as if they were wiser than God."

Their new geoist economic system was a great success. It looked like they would have an abundant harvest this time. But then, during the summer, the rains stopped, threatening the crops. The Pilgrims held a "Day of Humiliation" and prayer. The rains came and the harvest was saved. It is logical to surmise that the Pilgrims saw this as a was a sign that God blessed their new economic system, because Governor Bradford proclaimed November 29, 1623, as a Day of Thanksgiving.

This was the first proclamation of thanksgiving found in Bradford's chronicles or any other historical record. The first Thanksgiving Day was therefore in November 1623. Much later, this first Thanksgiving Day became confused and mixed up with the shooting party with the Indians of 1621. And in the mixup, the great economics lesson was forgotten and then discarded by the time the Plymouth Colony merged with the Massachusetts Bay Colony in 1691.

The Pilgrims recognized that the land itself was and should be their common community property, but that it is proper for the fruits of the labor of each person and family to belong to those who produced them. This was the great economics lesson the Pilgrims learned, a lesson that so impressed them that they commemorated it every year thereafter. This should have been a day to remember their vital economics lesson, but this lesson was later forgotten in the mixup with the shooting party with the Indians!

This bitter lesson would be learned all over again by the people of the Soviet Union, where socialism and communalism of production failed again. Fortunately the Pilgrims, a smaller community in simpler times, were able to switch quickly and realize the great prosperity that comes from applying the geoist principle of the common ownership of land and the individual ownership of labor.

Thanksgiving Day should be remembered not just as a day when we give thanks for our abundance, but more deeply and historically when we recall why we have this abundance. In our Thanksgiving Day celebrations, let us therefore tell one another the true origins of the thanksgiving and the great economic lesson that it rightfully should remember.

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Amazon on November 25, 2010, 09:03:13 am

Thank you for providing this enlightening post
as we commemorate some of our Founding  Parents
and as we publicly thank God for our many blessings.


Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Amazon on November 25, 2010, 09:15:00 am

The article mentions the failure of Russia's attempt at communism.

I would like to comment that
when I was studying traditional Chinese Culture
during my university days,
my professor reported a similar finding in Communist China
(as opposed to Taiwan and the then British occupied Hong Kong ).

Apparently early attempts to communally work the land were a failure,
similar to the colony at Plymouth
and for the same reasons.

Mainland China then changed their original plan
so individual families would literally reap what they had sown.

that was in the early 1970's;
I do not know how farming in China is managed in this day and age.

I imagine the system may be similar to the agrobusinesses in the USA today.

Do you know anything about China's present land management ?

Thanks in advance,

; )

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on January 05, 2011, 01:53:34 pm

Thank you for providing this enlightening post

You're quite welcome.  8)

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on January 05, 2011, 01:54:14 pm (

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on February 17, 2011, 01:11:56 pm (

( (

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on February 17, 2011, 01:13:43 pm
On yesterday's show I heard Alex Jones and Paul Craig Roberts talk about how "land speculators" are artificially driving up the price of farm land.

I hope everyone realizes that this is the inevitable result of not having Henry George's Single Tax ( in place.

------------------------------ (


A theory of economic boom and crash is one of Henry George's ( two great purposes in Progress and Poverty. What is the root cause of the "paroxysms of industrial depression"?

The root cause, says Henry George, is the speculative rise of land prices, which cuts into the earnings of labor ( and capital ( Land rents and prices rise at a faster rate than general economic growth, because of two unavoidable facts:

  • Land is fixed in supply.
  • Land is needed for all production.

When sufficient numbers of workers and capitalists cannot afford to produce at the higher rents ( brought about by growth and speculation (, production begins to stop.

Let us examine some of the implications of this fact for modern economies:

New Construction is Limited. If builders must pay too much for building sites, it takes from their profit by raising their costs. Their profit on investing in the building itself is what stimulates investing, which in turn is what makes jobs and incomes.

Business Costs Go Up. Businesses that rent their premises also get squeezed by rising rents. Here's an example: A merchant goes into a new shopping center with a long term lease. His rent is often too high, but he pays it to hold his position for the later term when he hopes the rent will be a bargain. Landlords writing long-term leases get used to this, and hold out for high rentals.

Nonproductive Investments Become More Profitable than Productive Ones. Let’s say that you own some land, which you might decide to improve. But, you have the option of selling the land to a speculator. Why improve the land if the profits on your improvements would yield little more than merely collecting the speculation-hyped value of the vacant site? Landowners will "site-sit" and wait, if they believe future development will be much more gainful than development for the current market. When the workaday facts of today begin looking dull and prosaic next to the gleaming expectations of tomorrow, look out.

Banking and Credit is Destabilized. Builders needing land borrow to buy it, even though the price is too high, gambling that future rises in rents will let them repay the loan. If these rent rises fail to happen, they go bankrupt. Their buildings are not destroyed, but the capital they used to build on them was misdirected, so much of it is economically lost: the buildings lose their market value.

Unlike items of wealth, which are priced according to their cost of reproduction at the present time, land is not produced -- so it has no cost of production. Yet it is bought and sold, like articles of wealth. The selling price of land is determined by comparing its income potential with that of an equivalent value of wealth, through a process called capitalization. Here's how that works ( However, the capitalization of current rent is only the beginning. With land, there is nearly always an added premium reflecting expected price increases in the future.

Speculation raises land prices beyond the sites' current use values. Credit is extended farther in order to accommodate this. That is, banks lend on overpriced land, counting on a further rise. When the rise slows, they extend the loans, sometimes even granting new loans for paying interest on old loans. They use political pressure to get governmental agencies (e.g. the World Bank) to extend or underwrite these risky loans (e.g. in Latin America). When the bubble bursts, the loans are not repaid. This destroys capital. The Savings & Loan fiasco of the 1980s is a case in point, but the basic dynamics are there in every recession.

This is not a new phenomenon. John Stuart Mill ( had written (before Henry George) of a tendency of lenders, when legitimate demand for loans dries up, to "lower the quality of credit" by accepting high-risk loans they would have spurned before. Because land value is such a large part of collateral on loans, and land values fluctuate wildly in business cycles, the tendency toward these volatile, high-risk lending practices is very strong.

Why don't capitalists needing land simply join in the speculative game? Couldn't they buy land at speculative prices and use it while it continues to rise in value? Actually, that's what they all do. No one can justify buying and holding land at today's prices without counting the future advance in price or rent as part of his or her gain. Thus everyone is hooked, forced by the market to participate in the speculative game, once it gets started. All become implicated and habituated, emotionally and politically, whether they like the principle or not. Eventually people forget that there could be any other way of doing business.

How do labor and capital resist advances in land value, when they must have land in order to produce? By ceasing production. What does this mean in real life? Labor and capital decline to buy or rent land at the high asking prices. Some will rent or buy less land, and use it more intensively. Some will sleep on the street, or sell from the sidewalk. Some will retreat to little patches of marginal land. Some will buy as much land as ever, but thus use up funds they otherwise would have used to improve it, becoming withholders themselves. Some will organize and pass counterproductive rent-control laws. The economy-wide net result will be less production, more unemployment.

The question that many modern-day economists fail to ask is this: How do investors react to a set of incentives where expected changes in land value are made part of the overall return on investment -- and land price is part of the investment on which return is figured?

This has several results:

  • Many are screened out by the increased need for credit.
  • Rising land value becomes part of the incentive to build. It can't go up forever. When it levels off at a high level, it becomes a serious drag. When it starts falling, it is worse.
  • Land value becomes collateral; its wild swings destabilize credit and money.
  • A lot of land is unused, (or run down in its present use), as the holder waits for a possible higher use that never materializes. In and after a crash, bid prices for land fall, but asking prices stay high, so sales drop like a stone. This behavior is inconsistent with the premises of the "rational expectations" theorists, but is good history: it has been extensively documented, over several giant cycles of boom and crash.

Land Speculation and Inflation?


There are as many different theories of the basic cause of inflation as there are for depressions. But since today's business cycle seems to involve a constant tension between periods of inflation and periods of unemployment/recession, the two phenomena clearly are linked.

George said almost nothing in Progress and Poverty about inflation; in his day industrial depression was a much more serious problem. However, inflation was not unheard-of in those days, and a strong connection is implied in George's reasoning. Consider the following statement regarding George's remedy (which this course is soon to consider): "Taxes may be imposed upon the value of land until all rent is taken by the state, without reducing the wages of labor or the reward of capital one iota; without increasing the price of a single commodity, or making production in any way more difficult."

What has this to do with inflation? George identifies land rent ( as an income that does not come from production; it is, in effect, a tax on production, the burden of which increases as production increases -- due to rising demand for the fixed supply of land. The tendency of this process is, as we have seen, to raise land rents beyond the marginal ability of labor and capital to pay them -- and depression is the result.

This process can be forestalled, temporarily at least, by increasing the money supply. Remember, the income of landowners increases as overall production increases, even though landowners make no contribution to production! The buying power that landowners gain, laborers and capitalists lose. But the effect of this can be blunted by increasing the money supply. When then supply of money increases faster than the supply of actual wealth, that's called inflation. An increase in the money supply can stimulate demand for goods, for a while -- if people have a certain amount of money to spend, they will try to spend it before it loses its value. Thus, an increase in the money supply, via lowered interest rates, can keep a period of economic growth alive -- at least until after the next election.

However, even this expediency is thwarted by the process of land speculation. As we explained here (, land prices are arrived at via the process of capitalization. Essentially, the annual rent of a site is divided by the current rate of interest, and this capitalized rent is the basis for the selling price (most often a speculative premium will be added). Now, if the central bank lowers interest rates to free up the money supply, this means that the divisor, the capitalization rate, is a lower figure -- and therefore land prices will increase!

Many analysts, for example, note that the persistently low interest rates maintained by Alan Greenspan's Federal Reserve in the early 2000s played a key role in the "housing boom" that followed. Of course, in the real world a great many factors influence financial markets, and particular market situations are extremely complex. However, this by no means denies the pivotal, fundamental role played by land rent and land speculation. Eventually, in a growing economy (even if the growth is only a short-term blip brought about by fiscal stimulus), increased rents will consume the extra buying power. Then, one of two things must happen: either the money supply must be increased further, risking runaway inflation -- or there must be a recession.

[Continued... (]


Title: Rebuttal to Arguments Against Land Value Taxation
Post by: Geolibertarian on March 08, 2011, 12:50:52 pm (

Rebuttal to Arguments Against Land Value Taxation

by Fred E. Foldvary, Senor Editor
The Progress Report
February 28, 2011

On 18 October 2010 I wrote on "Arguments Against Land Value Taxation" (to see it, click here ( ). I now provide the rebuttals.

1. Critics say that the supply of usable land can be expanded by filling, clearing, and leveling. No, because that does not change the cubic meters of space within the boundaries of the area. The improvements are capital goods, not land. Taxing land value does not tax the improvements.

2. Critics say that the supply of land offered in the market is not fixed. Yes, the quantities offered for sale are not fixed, but the total amount of land available is fixed. The sale of land just changes the persons who have title. The total quantity is important in setting the market rent and price of land. The fixed total quantity, and the fact that land was provided by nature, makes land rent an economic surplus that can be tapped with no economic damage.

3. Critics say that there is plenty of bare land, so there is no shortage of land, and no land problem. Yes, there is much unused land, but what matters is the scarcity of land in locations people want to use.

4. Critics say that much of the value of land comes from services and improvements such as streets, parks, and security, so land-value taxation would tax the capital goods along with land. No, because if the added value comes from privately provided works, the payment would go to the providers by contract. If the public works are provided by government, then the added rental goes to the government to pay back value received and avoid a subsidy to landowners.

5. Critics say that people have much of their asset value in land, and LVT would result in great losses and also wreak financial markets as much of lending is for mortgages. Not if those with net losses are compensated with bonds. To see "How to end stinking taxes immediately" click here (

6. Critics of LVT claim that speculation ( is an essential part of a market economy, as entrepreneurs seek the best timing for development, and LVT results in premature redevelopment and causes too much building. No, because the tax on land value is independent of its actual use, based only on its potential in its highest and best use, and it is the lack of LVT that in some cases causes premature development expecting higher land value, and in other cases causes speculators to avoid developing, waiting for higher land values. LVT promotes the optimal timing as the opportunity cost of not developing is in money and thus has a greater impact. What is bad is not speculation as such but subsidized land value, distorting incentives.

7. Critics say that LVT redistributes wealth from landowners, but there is nothing morally wrong with an inequality in wealth and income. But when government provides public goods paid for by taxes other than on land, this pumps up rent and land value, redistributing wealth from workers to landowners. And for land value provided by nature, geoist ethics say that human equality requires an equal benefit from natural resources. Inequality in market wages respects equal self-ownership, while an unequal benefit from the natural heritage does violate our creation as moral equals.

8. Critics say that LVT is not fair to homeowners whose land goes up in value and whose wages do not rise. But LVT would provide an opportunity for companies to provide insurance against an unexpected increase in the land value tax. The insurance would have a cost at the time of purchase, so that the new titleholder would know if he could afford the payments. Also, retired folks with low incomes could postpone the payments until the property is sold or inherited.

9. Critics of LVT claim that much of wages is due to luck, connections, and talents, so a portion is wages is unearned. But as Henry George wrote, justice is the end, taxation only the means. It is just for the benefits of natural resource to be shared, and for landowners to pay back the rental generated by public goods. Self-ownership is also just, even if some have greater wealth due to luck. Nobody is coercively harmed if one person has more talent than others. If others own your luck, you become a slave to them, violating self-ownership.

10. Critics of LVT claim that rent is often earned as landlords actively seek out the best tenants and the best use of a site. But this is not rent; the return on this exertion is wages. Those seeking the best tenants and sites are in the role of entrepreneur, not landlord. Some of the rental that tenants pay is wages to the entrepreneur and to the manager.

11. Critics say that the tax burden should be shared by everyone, not concentrated on landowners, and that since tenants don’t pay taxes, they will vote for bigger government. But the rent tapped for public revenue is what is paid by tenants. The rent could be taken directly from tenants, skipping the landlord middleman. A “citizens’ dividend (,374.msg1127.html#msg1127)” or distribution of some of the rent to all residents would provide an incentive for people to avoid wasteful government spending, as that would reduce their cash dividend.

12. Critics claim that there is no precise method of separating land value from improvement value. They have not talked to professional real estate appraisers. Land value appraisal is needed for fire insurance, mortgages, the purchase of land with a building to be demolished, and other private transactions. Techniques to appraise site value include comparable sales of bare lots or lots sold for demolition, calculating the replacement costs of buildings minus depreciation, and maps of neighborhood properties.

13. Anarchist critics claim that LVT would finance government tyrants. But geoism is not just the taxation of land but equally sharing the benefits. Geoism opposes landlord tyranny.

14. Socialist critics claim that LVT leaves intact capital inequalities. But much of the historical inequality of wealth has come from land tenure. Over time, inherited wealth other than land dissipates or gets donated to charity. With good education and equal access to natural opportunities, inequalities in financial assets are not unjust so long as there is no force or fraud.

15. Critics of LVT claim that property ownership promotes civil values and stability. This has been disputed (, but if true, the ownership of one’s human capital, future wages, buildings, and personal property should provide similar benefits.

For more detailed rebuttals, read the book Critics of Henry George (

Title: Mass Privatization as the "Final Stage" of Neoliberal Doctrine
Post by: Geolibertarian on March 19, 2011, 09:31:18 am (

“Wisconsin Death Trip.” Mass Privatization as the "Final Stage" of Neoliberal Doctrine

by Prof Michael Hudson and Prof Jeffrey Sommers


Global Research
March 12, 2011

On Wednesday evening, in a veritable Night of the Long Knives, Wisconsin's integrity was brutally murdered on the floor of the state Capitol in Madison. On 9 March, integrity and trust built up over a century was obliterated as Wisconsin state senators quickly reversed course and cleaved its budget "repair bill" in half. Financial items require a quorum, thus, collective bargaining was split off from the budget repair bill and voted on separately so as to permit its being voted on now. Even so, this still broke the state's open meeting law requiring 24 hours' notice to ensure transparency. Instead, the Wisconsin senate Republicans pulled out this new legislation without advance notice and began voting, leaving only a stunned Democratic legislator, Peter Barca, to read the open meeting law out loud to prevent the senators from voting. The senate voted over his objections anyway.

The Wisconsin brand has always centered on integrity. This was really about the only distinctive comparative advantage the state could lay claim to. Now, it is gone. With collective bargaining abolished, huge issues remain beyond labor. The privatization of public assets is now on the agenda, with the yet-to-be-voted-on budget repair bill.

Wisconsin is a state that invented Progressive Era Republican rule in the 19th and early 20th centuries under such progressive populists as Robert LaFollette. Under their tenure, rent-seeking ( from the public domain and similar insider corruption were checked by a strong public sector anchored in integrity. The state's long history of reforms nurtured a prosperous middle class and made it a model of clean government, solid infrastructure, trade unionism and high value-added industry managed by socialists and the LaFollette Progressives.

Fast-forward to Scott Walker today. Representing a new breed apart from Wisconsin's earlier Republicans, he is seeking to re-birth the asset-grabbing Gilded Age ( A plague of rent-seekers ( is seeking quick gains by privatizng the public sector and erecting tollbooths to charge access fees to roads, power plants and other basic infrastructure.

Economics textbooks, along with Fox News and shout radio commentators, spread the myth that fortunes are gained productively by investing in capital equipment and employing labor to produce goods and services that people want to buy. This may be how economies prosper, but it is not how fortunes are most easily made. One need only to turn to the 19th-century novelists such as Balzac to be reminded that behind every family fortune lies a great theft, often long-forgotten or even undiscovered.

But who is one to steal from? Most wealth in history has been acquired either by armed conquest of the land (, or by political insider dealing, such as the great US railroad land giveaways of the mid 19th century ( The great American fortunes have been founded by prying land, public enterprises and monopoly rights from the public domain, because that's where the assets are to take.

Throughout history the world's most successful economies have been those that have kept this kind of primitive accumulation in check. The US economy today is faltering largely because its past barriers against rent-seeking ( are being breached.

Nowhere is this more disturbingly on display than in Wisconsin. Today, Milwaukee – Wisconsin's largest city, and once the richest in America – is ranked among the four poorest large cities in the United States. Wisconsin is just the most recent case in this great heist. The US government itself and its regulatory agencies effectively are being privatized as the "final stage" of neoliberal economic doctrine.

[Continued... (]

Title: Re: Land Value Taxation: Rebuttals to Common Objections
Post by: Geolibertarian on April 13, 2011, 04:06:54 pm (

Land Value Tax

Conventional property tax falls mostly on improvements.

To levy a conventional property tax, assessors normally determine the value of the land and the additional value of the improvements. The two values are added together and the total value is taxed. As a result, property tax falls mostly on improvements.

As a result, property tax penalizes most home owners, who usually improve and maintain their homes better than absentee owners. The property tax on improvements also discourages construction while it rewards those who milk run-down properties or sit on vacant properties with light taxes.


Land value tax (LVT) untaxes improvements

Jurisdictions that levy land value taxes charge lower rates (or no tax at all) on improvements. Taxes burdens on well developed and well maintained properties fall and burdens on blighted and vacant properties rise until identical lots pay the same taxes no matter what the improvements on those lots are worth.

LVT is easier to assess

Land lies out of doors, and all features are fully visible. In contrast, assessors have no right to inspect the interior or buildings without the building occupant's consent, and considerably more skill is required to assess the value of structural integrity and amenities. Land can be assessed more accurately than buildings, at a fraction of the cost of assessing buildings.

LVT fosters honesty

Conventional property tax encourages people to hide improvements, sometimes by secretly remodeling without filing building permits. Such dishonesty to avoid an assessment hike can create fire and health hazards, as the main purpose of permits is to insure that safety codes are respected. Other taxes encourage people to conspire to not report, or under-report, income, sales, etc. These corrupting incentives work not merely on taxpayers, but on government itself. Who is to know when a tax collector has "looked the other way" or brokered a deal if the tax information is private? Land values are entirely public information, and the factors that determine land values are also public information.

Location, location, location

Land values vary tremendously according to location. A square yard of prime Manhattan land is worth more than a typical acre of New York State farmland. The value of land in the most affluent residential neighborhoods can easily exceed 100 times the value in the poorest neighborhoods, especially where undertaxation of land has encouraged speculation.

Most home owners pay less

Dozens of studies in dozens of cities have shown that most home owners pay less under land value tax than under property tax, and much less than under income taxes. The only exceptions we have seen are where only a small minority of residents can afford home ownership or where businesses have been so overtaxed that demand for business properties has been discouraged.

LVT encourages growth

Hundreds of taxing jurisdictions around the world have experienced increased construction and renovation after shifting to LVT, including over 20 taxing jurisdictions (mostly cities) in Pennsylvania. Pittsburgh, which had higher taxes on land than on buildings from 1913 to 2000, enjoyed a major "renaissance" after World War II, despite an abrupt reduction in the demand for armor plate, most of which had been produced in Pittsburgh. This renaissance was the subject of articles in at least 27 magazines ( Another major surge in construction occurred in the early 1980s after Pittsburgh dramatically increased its tax rates on land value, despite the closing of its largest employer in 1979, Jones & Laughlin Steel. This second surge, dubbed "Renaissance II," was featured in the 1983 Fortune article, "Higher Taxes that Promote Development ("

LVT helps small business

Small businesses are more land-effficient, while big businesses are more labor efficient. Shifting to land value tax gives a competitive advantage to neighborhood business districts over shopping malls, small merchants over chain stores, and full-time family farms over agribusiness. By keeping land prices low, it also helps new businesses, which must buy or rent land, compete with established businesses that own their land free and clear.

LVT keeps housing affordable

LVT has such a powerful dampening effect on idle land speculation that even the land portion of the real estate tax keeps housing affordable. Cities with the highest real estate taxes have the most affordable housing. Texas and California were the two fastest growing states in the second half of the 20th century. Texas (, which relies heavily on property tax, having no personal income taxes, has four of the six most affordable cities ( in the nation. California (, which dramatically curtailed its property taxes, has 23 of the 25 least affordable cities (

It is only logical that a tax on buildings would discourage construction and reduce the supply of buildings, increasing real estate prices and rents. However, LVT is such a potent disincentive to idle landholding that it has a much stronger opposite effect. We found a strong correlation ( between high real estate taxes and housing affordability.

LVT reduces foreclosure

Keeping house prices stable and affordable reduces foreclosures. Also, any real estate tax must be born by the bank or mortgage company that forecloses. This makes mortgagors more willing to negotiate in order to avoid taking possession of the tax obligations. Beyond that, tax impact studies in Pittsburgh, Clairton, Duquesne and McKeesport have shown that LVT saves mortgaged home owners even more than other home owners.

LVT costs renters nothing

Economists agree that LVT is not passed on to renters, because rents are determined by what the market will bear, not by landlords' costs. LVT benefits landlords by encouraging higher density and attracting more tenants, not by gouging existing tenants. Other taxes drive productive tenants away and depress rents by more than what the landlord would have paid under a land value tax. All taxes eventually come out of rent, and LVT is the only one that does not discourage economic growth.

LVT is naturally progressive

LVT is most burdensome to those who hold valuable urban land they are not using. Clearly, these owners have no cash-flow problems, or else they would sell their unused land to people who would develop it. It also shifts the tax burden from home owners to corporate-owned and absentee-owned property, although corporations and absentee owners who fully develop their properties still save. Because land value tax is not passed on to renters or consumers, and because it keeps housing prices low for home buyers, it is the most progressive of all taxes.

LVT helps keep government local

One of the excuses for centralizing government is that other taxes chase residents and businesses out of local taxing jurisdictions. Because land is the one thing that does not cross borders to escape taxation, it creates no rationale for shifting government to state and federal jurisdictions.

LVT reduces sprawl

The need for government services is naturally highest in urban areas, where land prices are also highest. Higher taxes in cities and inner suburbs drive development outward, and land speculation also causes development to leapfrog over better urban and suburban sites into rural areas.

Replacing taxes that drive people away with a tax that discourages land speculation draws development inward, reducing sprawl. Places that have adopted LVT enjoy not only more development, but more compact development.

LVT streamlines government

Encouraging growth reduces the rationale for economic development subsidies. Growth also creates jobs, reducing the costs of unemployment compensation and public welfare expenditures. Reducing sprawl reduces the need for transportation expenditures. Keeping housing affordable reduces the need for housing subsidies and public housing.

Every proposed public expenditure should increase land values by more than its cost. Governments that fund themselves from a land value tax tend to make more rational spending decisions.

LVT reflects taxpayer benefits

The value of land is the only value that is created by access to community-created and government-created advantages. Under a land value tax, every taxpayer pays in proportion to the benefits he receives, and does not pay on the fruits of his own labors.

LVT is the most endorsed tax

From the seventeenth century to this day, and from across the political spectrum, LVT has been endorsed by more outstanding icons of economics, philosophy and statesmanship than any other tax.

LVT has a rich and strong history.

LVT was a centerpiece of classical liberalism, the progressive movement and the early labor movement. It was embraced by many of America's founding fathers and written into the Articles of Confederation. The first two tax rebellions in the United States were led in opposition to taxes that shifted the tax burden off of early land monopolists.

LVT is fundamentally fair

Whether the criterion is ability to pay or reflection of benefits received, LVT is the most fundamentally fair broad-based tax available. The biggest obstacle to adopting LVT is that interest groups try to get benefits for themselves at the expense of others. Under LVT, everyone pays in proportion to the benefits they ultimately receive.

Privileged interests oppose LVT

The great difficulty in advancing LVT is that it shifts the tax burden onto those who not only have the most ability to pay, but have the most ability to influence political leadership and public opinion. Yet LVT has often been supported by wealthy people who put public interest ahead of their personal enrichment.

LVT is gaining momentum

The economic successes in cities that have adopted LVT, and the economic consequences of productivity taxation, have led more and more cities to embrace LVT in Pennsylvania, where it is already permitted, and has led other states to consider it as well. It also enjoys increased support in several other countries.

Title: The Failed Explanation
Post by: Geolibertarian on April 20, 2011, 03:26:36 pm (

The Failed Explanation

by Fred E. Foldvary, Senior Editor
The Progress Report
18 April 2011

Weekly “alternative” newspapers throughout the USA on 13 April 2011 published an article by David Cay Johnson on “The failed experiment” (SF Bay Guardian) or “Tax the Rich!” (East Bay Express) or “9 Things The Rich Don't Want You To Know About Taxes” (Willamette Week; To see the whole article, click here (

The author claims that “misplaced faith in tax cuts” and other “economic myths” are destroying the economy of the USA. He is correct that the economy of the USA, and other countries also, are being destroyed, but this not because of tax cuts. What has caused wreckage and will cause future economic catastrophes are huge subsidies to land value. But this economic reality is not obviously observable, and understanding it requires a knowledge of economic theory that very few journalists have.

The author claims that the US government has conducted an economic experiment in “supply-side economics.” He describes this policy as tax cuts that stimulate investment and growth, which then generates more tax revenue than before. But real supply-side economics only proposes that a reduction in the cost of production results in more production. Supply-side theory cannot claim whether tax revenues will increase or decrease, since that is an empirical result that has to be found from application.

There is indeed a revenue curve theorized by the Arab economist Abu Said ibn Khaldun (1332-1406), popularized by economist Arthur Laffer. The Khaldun or Laffer curve says that at very high tax rates, there will be less tax revenue than at lower rates, because if almost all income gets taxed away, there is less production. If tax rates are low, then higher tax rates do generate more tax revenue. But where the US economy is or has been on the Khaldun curve is an empirical matter; supply-side theory cannot provide any particular maximum-revenue tax rate.

Actually, tax revenues did rise substantially after tax cuts. There were tax cuts during the administrations of presidents Kennedy in the 1960s, Reagan in the 1980s, and GW Bush during the 2000s, and all resulted in more economic growth and lower unemployment. The problem was not the tax cuts, but that the economic growth got misdirected into speculative real estate booms. The misdirection was caused by massive subsidies to land values.

The author talks about the rich and the poor without differentiating or examining where the money comes from. He does say that “Big real-estate investors enjoy tax-free living” because they can deduct “paper losses like depreciation” against income. But the author does not mention the greatest subsidy of all, the generation of land rental from public works and civic services, paid for mostly from taxes on labor. Worker-tenants pay twice for public goods, once in higher rental, and again in taxes. Landowners get subsidized by getting higher land value, along with low tax rates on real estate, legal-fiction depreciation, tax-free property sales, and tax-deductible mortgages and property taxes.

The author complains about the rich who pay no taxes, but does not provide the most effective remedy: tap land value for public revenue. Advocating higher income taxes on the rich ignores the fact that many of the rich get the funds back via the government subsidy to their land value. The alleged purpose of the income tax was to get the rich to pay most of the taxes, and the rich do pay much of the income taxes, but there are other taxes such as on goods that the poor pay, and the rich will have the political clout to obtain tax deductions, credits, and exemptions.

The remedy is a constitutional provision that requires the collection of the economic rent of all land. Unlike income and financial capital, land does not hide, flee, or shrink when taxed. The real estate assessments would be a public record for all to see.

Supply-side economists are correct in saying that lower tax rates on labor and enterprise will generate more production, investment, and growth. They usually avoid taking the concept to its logical conclusion: have no taxes on labor and capital yields, but do tap the full economic rent of land. Taxing or tapping land value promotes the most productive use of land, since it is based on the rent paid when land is optimally used, regardless of current use or current tenant payments. But the author is evidently unaware of, or else ignores, land-value taxation.

The author states that the incomes of most Americans have stayed about the same, while the income of the very rich rose substantially. But there is no examination of the cause: much of the gains from economic growth is captured by higher rent. That is why the few who own much of the valuable real estate, such as commercial land, get rich, while most folks break even. When wages do go up, the increase is eaten up by higher payments for housing. Some middle-class homeowners thought they were benefitting from rising real estate prices, only to suffer great losses from the inevitable Crash of 2008.

The author finishes by advocating “a tax system that benefits the vast majority,” but does not say what that would be. Unfortunately, readers are left with the impression that the remedy is to hike up income tax rates. But if high tax rates are so good, Kennedy would not have advocated the tax reduction that created prosperity during the 1960s, until the country got infected by the Vietnam war, higher inflation, and a real estate boom that crashed in 1973.

An opportunity to provide real economic education was missed. “The failed experiment” was a failed explanation. Interestingly, the fact that the author, a writer for the web site, did not explicitly advocate higher income tax rates, indicates that perhaps he may be conflicted, perhaps knowing the truth, but not daring to exclaim it.

Title: Is the Real Estate Market Voluntary?
Post by: Geolibertarian on July 12, 2011, 02:19:54 pm (

Is the Real Estate Market Voluntary?

by Fred E. Foldvary
The Progress Report

Some critics of the use of rent for public finance claim that real estate transactions are voluntary, so no damage is done when the land rent is kept by the owner instead of being shared by the community. So let's examine the question, is the rent paid voluntarily?

Critics of community rent claim that the payment of rent by a tenant is a voluntary payment for the service of finding tenants and allocating the best use of land. There are two issues involved in the issue of whether this is truly voluntary. First, is it voluntary not just for the agents involved, but for all society? Second, is it in fact voluntary for the agents?

Take the example of pollution. If Bob the buyer pays Peter the polluter for a product Peter makes, this is voluntary between Bob and Peter. But in making the product, Peter has polluted the neighborhood, something that is not voluntary for the residents. Economists call this a "negative externality" as a cost imposed on others, not compensated by the polluter.

The basic question here is, who is the morally proper owner of the land rent? If we agree that human beings are morally equal as persons and have equal natural rights, then the proper owner of natural land rent is all humanity in equal shares. In that case, when the landowner keeps all the land rent, he is stealing property that belongs to others, even if it is done legally. It is involuntary even if the members of the community do not claim this as their legitimate property, just as if a thief steals my radio and I don't know it is missing, the theft is still involuntary to me, as I did not consent to this taking.

The second moral question is whether a land transaction is voluntary even for the landlord and the buyer or renter. It is true that nobody is pointing a gun at them and ordering them to rent the land from the landlord. But suppose someone put you in prison and there were several empty cells you could be put into. The guard says, choose one of the cells. Is this choice voluntary? Relative to the cells, yes, you choose one. But the greater context of being in prison is involuntary, so the choice of cells is also involuntary. The higher-level coercions flows down to the lower-level choices. It is like asking you, if you are to be executed, whether you would prefer to be hanged, shot, gassed, or electrocuted. If your higher-level preference is to live rather than die, these choices are coerced, since you would rather not make such choices in the first place.

All land is monopolized, since new land cannot be created or imported. The landlords give you choice: which plot of land do you wish to be located in? You the tenant have no choice as to having to live on some land. Your only choice is which monopolist will take the rent that naturally and properly belongs to you in the first place as a member of the community. It is similar to the choice of prison cells. It is only superficially and by appearance a free choice, but the higher-level context of landlordism, of the landlords keeping rentals that do not properly belong to them, is mandated by the legal system imposed by government. So long as you are subject to that regime, you the tenant or buyer of land have no choice in substance.

The slave trade was also a voluntary transaction between a seller and buyer of slaves, but it was not voluntary to the slave, who morally was the proper owner of his own labor. It may not have been even voluntary to the buyer of slaves if everyone else in the neighborhood owns slaves and it is impossible to compete with them unless you too are a slave owner.

So only the overthrow of landlordism, the land tenure system where the title holder keeps all the natural rent, will make real-estate transactions truly voluntary. When the natural rent, due to the natural resource value, is shared by the community, including by using it for public revenue, then when a landlord rents to a tenant, this is truly voluntary, because the landowner is not taking what belongs to others. Then when a buyer purchases land, the purchase price is voluntary and also lower, because the rents belonging to others are not capitalized in the purchase price.

Don't blame all the landlords. Most are locked into the prison system just as much as the tenants. Blame the system. Blame the ignorance of the public, the greed of politicians and the landed interests who actively prevent rent sharing, and the apathy of voters who don't want to be bothered to improve their knowledge of ethics, economics, and government.

Title: Re: Is the Real Estate Market Voluntary?
Post by: Geolibertarian on July 12, 2011, 02:48:55 pm (

Is the Real Estate Market Voluntary?

Perhaps the most important conclusion to be drawn from the above article is that, contrary to what right-wing critics of Henry George’s Single Tax would have everyone blindly believe, the payment of land rent is “compulsory” regardless of whether or not it’s diverted into the public treasury. Why? Two reasons.

First, because land itself is fixed in both supply and location. If you go to a furniture store and buy, let’s say, 20 square feet of carpeting, is there automatically that much less carpeting to go around for everyone else? Of course not. Why? Because new carpeting is being produced all the time. The same principle applies to all other products of human labor. But with land it’s the very opposite: since land is fixed in both supply and location, if I appropriate so many acres or square miles of it, then there is that much less for everyone else. Hence Adam Smith’s conclusion that:

    "The rent of the land, therefore, considered as the price paid for the use of the land, is naturally a monopoly price."

-- The Wealth of Nations, Book 1, Chapter 11

Thus, if the Queen of England gets to assert exclusive, unconditional “ownership” of the billions of acres of land ( to which she holds title, then every other overprivileged aristocrat and absentee landlord gets to do likewise. The end result? An artificial scarcity of available land. And it is this artificial scarcity that allows landlords and slumlords to continually rent gouge ( landless wage-earners to such an extent that the latter rarely have more disposable income than is needed just to survive (many times not even that much -- hence the growing trend of college graduates having to move back in with their parents).

Secondly, because access to land is a universal precondition to life itself. Thus, in a world in which all land has been appropriated ( by a mere subset of the population, and in which billions of people are continually driven by the threat of either starvation or harsh weather into competing for access to it, land rent gets paid either way -- and is paid under penalty of "force" either way (as any sheriff who’s had to evict unemployed tenants at gunpoint will readily attest).

Reactionary defenders of privilege ( often object to this by asserting that, since wage-earners get to choose "who" they pay land rent to, it’s a “voluntary” payment. But as Dr. Fred Foldvary explains in the above article, this is misleading at best, because it conveniently ignores the fact that -- due to the two reasons just mentioned -- they have no real “choice” as to whether they pay, since the only “alternative” to paying is to either beg and grovel for charity or (if no charity is granted) simply starve.


This may be easier for some to understand if we consider the issue of chattel slavery. Would a chattel slave in the 19th century have been any less of a slave if he got to “choose” who his slavemaster was? Of course not. Why? Because he still wouldn’t have been free to choose whether he had a slavemaster to begin with.

    "Would the essence of slavery change if the rules at a slave auction permitted a slave to choose between the two highest bidders for himself? Could the fact that he made such a choice be interpreted as his sanction for his chains? How can it be argued that the citizen is free in a democracy when he has the choice of two candidates if neither candidate is willing to recognize his right to freedom?"

-- James Bovard, Freedom In Chains (, p. 132

Same principle here. A person isn’t truly free unless he has not only the choice of who gets to exact tribute from him in exchange for a mere place to stand without being threatened or shot at, but the choice of whether he has to pay such tribute to anyone in the first place. And the bottom line is: in an Austrian School economy, millions if not billions of people would have only the former choice, not the latter -- that is to say, they’d have only the choice of to whom they pay feudal tribute, not whether they pay.

Thus, since the payment of land rent is compulsory regardless of whether it’s collected publicly or privately, the only question is, Does such payment constitute “feudal tribute” regardless of who the recipient is?

The short answer is “no.” To understand why, consider the following analogy.

Let’s say I invent a one-of-a-kind machine that generates unlimited electricity, and that I will it equally to my five sons. Once I pass away, the question immediately arises as to how to adjudicate disputes over who gets access to it, and on what terms. If the eldest son insists on enjoying exclusive possession of my machine, then the government-enforced payment of rent to the other four is, in that context, not a tribute for using that machine, but a fee for the state-sanctioned privilege of denying use of it to those who have an equal right to it. But what if we’re in an Austrian School economy, and what if, realizing this, the eldest son “mixes his labor” with the machine by cleaning it and painting it a different color? Then the court system will likely rule that any and all rental value that is generated by the ongoing competition for exclusive access to the machine is the “private property” of the eldest son. In that context, the payment of rent to the eldest son is not a fee for the privilege of denying use of the machine to those who are thereby dispossessed of their birthright, but a tribute paid by one of the dispossessed for mere access to that which, in reality, he has as much a “right” to as the one receiving tribute. In the former context there is justice, because all five sons are treated as moral equals. In the latter context there is injustice, because they’re not treated as moral equals.

Thus, whether the payment of land rent (returning now to the issue at hand) constitutes feudal tribute or not depends on to whom it’s paid. If it’s paid to titleholders, then it’s feudal tribute, because it’s based on the aristocratic ( notion of the earth being that to which titleholders have an exclusive right of access. If it’s paid instead (whether directly as a citizen’s dividend or indirectly through the rent-financed provision of public goods and services) to those who’ve been dispossessed of their natural birthright, then it’s mere compensation, because it’s based on the recognition that the earth is that to which all humans (not just titleholders) have an equal ( right of access.

To understand just how absurdly immoral and anti-“liberty” the Austrian School alternative is, imagine if someone proposed allowing wealthy rent-seekers to buy up all the air “with their hard-earned money” and begin charging everyone else rent for breathing “their” property. Most people, of course, would instinctively object to such a ridiculous proposal. But why they would object? Because they’d realize that the air we breathe is not provided or “allocated” to us by any person or group of persons presuming to “own” it all, but is made available to us by nature -- or by God, if you're religious -- and that to be denied access to it for failing to pay feudal tribute to an airlord is to have the property you have in yourself violated.

Georgists simply apply the same principle to land, because, just as air itself is a free gift of nature, so too is land; and just as access to air is a universal precondition to life itself, so too is access to land. (I realize land and air have different physical characteristics, but in the two key respects I just mentioned, they’re very much the same.)

As for the privatize-everything Austrian School, the bottom line is: if speculators could hoard the air the way they hoard land, and thereby confer to themselves the power of exacting a monthly ransom fee from those needing access to it to live, then, as long as there was a “free market” in the sale and purchase of air titles, there’d be slogan-parroting Austrians all over the place proudly defending this extortion racket in the name of (you guessed it) “liberty” and “private property rights.” They’d be saying things like, “Airlords aren’t parasitizing people through a form of legalized extortion as certain freedom-hating, property-rights-hating socialists have claimed; they’re merely ‘allocating’ the air to the most productive breathers.” (

As ridiculous as that sounds, the sad reality is that, as long as those spouting such aristocratic nonsense were wrapped in the American flag or the flag of “liberty,” millions of gullible people would actually fall for this and start blindly defending the very system that’s parasitizing them -- insisting all the while that only those who hate liberty and private property would so much as question the legitimacy of that system. It’s right out of a George Orwell novel.

Unfortunately, these are the kinds of reactionaries who’ve territorialized the anti-NWO ( (i.e., anti-war/anti-police state/anti-eugenics/anti-global government) movement, which no doubt pleases the global elite, because that means the number of people who compose this movement will never reach critical mass (since most of the millions of non-reactionaries out there simply have better things to do with their time than listen to label ( reactionaries call them freedom-hating “socialists” and “communists” all day long).

I can only hope that threads such as this one help to reverse that trend.

Title: Tens Of Thousands Of Formerly Middle Class Americans Are Sleeping In Their Cars
Post by: Geolibertarian on July 13, 2011, 02:16:12 pm
"Queen Elizabeth II, head of state of the United Kingdom and of 31 other states and territories, is the legal owner of about 6,600 million acres of land, one sixth of the earth’s non ocean surface.

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

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

-- (

“Given a stationary population and private ownership of all land, improvements in manufacturing methods do not, in the long-run, increase the earnings of labour and capital, but are absorbed by rent (”
-- Max Hirsch, Democracy vs. Socialism (, p. 446

"I am using the word wages not in the sense of a quantity, but in the sense of proportion. When I say that wages fall as rent rises, I do not mean that the quantity of wealth obtained by laborers as wages is necessarily less, but that the proportion which it bears to the whole produce is necessarily less. The proportion may diminish while the quantity remains the same or even increases."

-- Henry George, Progress and Poverty (, p. 216

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

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

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

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

"A family in the United States needs to earn $18.44 an hour, or nearly $38,360 a year, in order to afford a modest rental home, according to a report released April 21 by the National Low Income Housing Coalition. Despite the recession, the report finds that rents continue to rise, while wages continue to fall across the country."

-- (

Keep the above in mind as you read the following:

--------------------------------- (

Tonight Tens Of Thousands Of Formerly Middle Class Americans Will Be Sleeping In Their Cars

The Economic Collapse (
July 13, 2011


Economic despair is beginning to spread rapidly in America.  As you read this, there are millions of American families that are just barely hanging on by their fingernails.  For a growing number of Americans, it has become an all-out battle just to be able to afford to sleep under a roof and put a little bit of food on the table.  Sadly, there are more people than ever that are losing that battle.  Tonight, tens of thousands of formerly middle class Americans will be sleeping in their cars, even though that is illegal in many U.S. cities.  Tens of thousands of others will be sleeping in tent cities or on the streets.  Meanwhile, communities all over America are passing measures that are meant to push tent cities and homeless people out of their areas.  It turns out that once you lose your job and your home in this country you become something of an outcast.  Sadly, the number of “outcasts” is going to continue to grow as the U.S. economy continues to collapse.

Most Americans that end up living in their cars on in tent cities never thought that it would happen to them.

An article in Der Spiegel (,1518,712496-2,00.html) profiled one American couple that is absolutely shocked at what has happened to them….

    Chanelle Sabedra is already on that road. She and her husband have been sleeping in their car for almost three weeks now. “We never saw this coming, never ever,” says Sabedra. She starts to cry. “I’m an adult, I can take care of myself one way or another, and same with my husband, but (my kids are) too little to go through these things.” She has three children; they are nine, five and three years old.

    “We had a house further south, in San Bernardino,” says Sabedra. Her husband lost his job building prefab houses in July 2009. The utility company turned off the gas. “We were boiling water on the barbeque to bathe our kids,” she says. No longer able to pay the rent, the Sabedras were evicted from their house in August.

How would you feel if you had a 3 year old kid and a 5 year old kid and you were sleeping in a car?

Sadly, if child protective services finds out about that family those kids will probably be stolen away and never returned.

America is becoming a very cruel place.

Unfortunately, what has happened to that family is not an isolated incident.

[Continued... (]


If anyone thinks this trend of people being rack-rented ( out of their homes started only a few years ago, think again:


High California rents push working poor to cheap motels
October 30, 2000

ANAHEIM, California (CNN) -- Home for Yolanda Miramontes and her five children is a cheap motel room in Anaheim, California, a thriving city where the average apartment rents for $1,200 a month.

Southern California's booming economy has pushed rents so high that most apartments are far out of reach for low-income families. And that's contributing to a growing trend: entire families living -- permanently or semi-permanently -- in motels.

In Anaheim, population 310,000, as many as 2,000 people are full-time motel residents. "It's hard on the kids," Miramontes told CNN. "Although they call this home, I still can't accept it."

With few low-income housing projects underway, the working poor have been squeezed out of the housing market and into small motel rooms renting for $600 a month -- roughly $20 a day.

"I think this is the best place for us to be right now while we are looking for somewhere else," said Ebony Green, another motel dweller in Anaheim.

Renters 'are no longer the unemployed'

The Covered Wagon, a 70-unit motel in Anaheim, gets most of its business from locals. "What's different is that the people who are staying here are no longer the unemployed," said owner Jim Parkin.

His renters include parents who work at restaurants, amusement parks, gas stations and other service establishments in Orange County, home to such tourist magnets as Disneyland and Knotts Berry Farm.

"There's no one here collecting cans," Parkin told the Los Angeles Times.

While there are no precise statistics on motel dwellers, motel owners in Anaheim, Long Beach and Van Nuys told the newspaper they've seen dramatic increases in the number of long-term motel residents.

"We are reaching an unparalleled crisis in our housing," said Gary Squier, a consultant and former head of the Los Angeles Housing Department.

[Continued... (]


Yet what do privilege ( right-wingers propose as a solution? Make socially-created land rent ( even more privatized ( than it already is, even though this will not only make the rent-wage gap ( even wider than it already is, but will ensure that governments continue to impose job-destroying taxes on the privately created values of labor ( and capital (! (

Title: Bill O’Reilly Calls For New National Sales Tax
Post by: Geolibertarian on July 25, 2011, 09:23:51 am (

Bill O’Reilly Calls For New National Sales Tax

You Tube
July 13, 2011 (

O’Reilly calls for Americans to be hit with a 1% national sales tax, moving closer to a European-style system where people not only have some of the highest income taxes in the world, but also pay 20% or more in sales taxes (VAT).

Title: Michael Hudson on the importance of economic rent
Post by: Geolibertarian on July 25, 2011, 09:26:39 am
In the following clip Professor Michael Hudson ( talks about the importance of economic rent ( (