I'm a real estate valuer who worked in the Australian Taxation Office (ATO) and Commonwealth Bank of Australia (CBA) before co-founding a private valuation practice, Westlink Consulting. I discovered that we leave too much publicly-generated land rent to be privately capitalised by banks and individuals into land price bubbles. This generates repetitive recessions and depressions. These need to be avoided by capturing more revenue from land values to free up wages and household debt.
I love a timid country A land of scare campaigns Where mindless bogan slogans Just overtake our brains The stunted, short horizons Of those who will not see Who, presented with alternatives Think only: me, me, me.
If you want to address inequality, income is a major factor.
Apart from state subsidies, the main sources of income are
wages, business profits and location – and location often takes quite a big part
of business profits (just speak to a tenant in a shopping centre).
Anyone theoretically can make an effort to increase their wages and, with endeavour, business profits – however, land and location are rather different – income from location goes to the owners. Those that own land, especially in good locations, have rather an advantage, they get income (either through capital gain or actual rent) that does not go to wage earners and business owners; often a significant part of what would be a business’s profit actually goes to the owners of location, and as we have heard housing rents can sometimes exceed 90% of a person’s income (for people on Newstart).
Inequality of opportunity can therefore be starkly traced
back to inequality of ownership of land, or more specifically to the benefits
of land. Unless that is addressed, efforts to reduce inequality of opportunity
will go nowhere.
Added to that, there is a theory that is summed up as ‘Land takes the gains’ – meaning that any real improvements in general wage incomes, productivity, infrastructure, viz, any societal good will always inflate land values. What this means is that all the best endeavours to fix anything else (including increasing Newstart) without addressing land income distribution will simply result in land values or rents going up, soaking up the best endeavours to progress.
Why are people working harder than ever before, but having insufficient time to devote to their family?
Why is the state of their financial affairs declining?
Why do they spend less time enjoying nature and the classical pursuits.
Why has middle class poverty increased as the uber-wealthy have become far wealthier?
It’s the elephant in the room for every one of your questions, QandA! We could deal better with the many issues with which we’re confronted if the economy was working for people, instead of just feeding the extractively wealthy.
I vented frustration at world economies in terminal decline today in these tweets (amongst others!):-
Bryan Kavanagh@bryankav123·9h Replying to @Renegade_Inc Yes, billionaires get there because we tax productivity, instead of unearned income/economic rent. We pay an enormous price for defying Adam Smith, David Ricardo, JS Mill, Henry George, Mason Gaffney, Joseph Stiglitz, et al, on the point that unearned rents must be taxed away.