~~~

These interesting heterodox exchanges had me thinking about Henry George’s insights touching upon energy. Land, labour and capital is the actual order of production, not vice-versa as we’re often told. Our natural resources are worked upon by the energy expended by labour to generate both wealth and the capital that is used to expend further energy.

We tax wages and purchases, so we have less of them. George noted that if we were to capture our resource rents we’d have less destructive speculation, leaving labour and capital with their rightful returns–their earnings–sans taxes! This, in turn, protects the environment and natural resources. Joseph Stiglitz has argued a case for capturing as close to 100% of natural resource rent as possible.

Were we to do that, we’d be able to have Kate Raworth’s proposed universal basic income and abolish poverty: without inflation!

We can’t quite bring ourselves to consider and discuss the fundamental remedy for the soul-destroying bifurcation happening across the world. The Hamas-Israel war confirms the phenomenon isn’t improving.

It’s likely to get worse, of course, because neither the left or right side of the split is prepared to admit the fundamental cause is land-grabbing. “No, that’s just too simplistic!”

Is it possible that we might respond and heal were we to acknowledge the longstanding imperative that land should not be sold – that the land rent be paid? Nup, it once was, but it’s on the agenda of very few people these days.

Australia has the constitutional referendum on The Voice on Saturday. It’s likely to be lost, unfortunately. Even among those prepared to vote ‘Yes’, we’d expect the fingers of one hand to number those who could bring themselves to accept anything like the following as a preamble to the Constitution that might bring Australians back together: –

We’re therefore likely to continue to proceed “as is”, with Australia poised to experience the final three-year speculative mania of the current eighteen-year real estate cycle – and suffer its devastating consequences.

This has been blogged as a positive reminder that there are remedies to be found amidst the gloom in which the world finds itself.

Where are we in the 18-year cycle?

Phase 1: 2013-2018 ‘recovery’ 6 years

Phase 2: 2019-2020 ‘mid-term recession’ 2 years

Phase 3: 2021-2023 ‘boom’ 3 years

Phase 4: 2024-2026 ‘mania’ 3 years

Phase 5: 2027-2030 ‘crash & rescue’ 4 years

• See Akhil Patel’s “The Secret Wealth Advantage: How you can profit from the economy’s hidden cycle” (2023)

AN INTERNATIONAL DECLARATION ON INDIVIDUAL AND COMMON RIGHTS TO EARTH

We hereby declare that the earth is the common heritage of all and that all people have natural and equal rights to the land of the planet. By the term ‘land’ is meant all natural resources.

Subject always to these natural and equal rights in land and to this common ownership, individuals can and should enjoy certain subsidiary rights in land. These rights properly enjoyed by individuals are:

1. The right to secure exclusive occupation of land
2. The right to exclusive use of land occupied
3. The right to the free transfer of land according to the laws of the country
4. The right to transmit land by inheritance

These individual rights do not include:

1. The right to use land in a manner contrary to the common good of all, e.g., in such a manner as to destroy or impair the common heritage
2. The right to appropriate what economists call the economic rent of land

The economic rent is the annual value attaching to the land alone, apart from any improvements thereon created by labour. This value is created by the existence of and the functioning of the whole community wherein the individual lives and is in justice the property of the community. To allow this value to be appropriated by individuals enables land to be used not only for the production of wealth but as an instrument of oppression of human by human leading to severe social consequences which are everywhere evident.

All humans have natural and equal rights in land. Those rights may be exercised in two ways:

1. By holding land as individuals and/or
2. Sharing in the common use of the economic rent of land.

The economic rent of land can be collected for the use of the community by methods similar to those by which real estate taxes are now collected. That is what is meant by the policy of land value taxation (LVT). Were this community created land value collected, the many taxes which impede the production of wealth and limit purchasing power could be abolished.

The exercise of both common and individual rights in land is essential to a society based on justice. But the rights of individuals in natural resources are limited by the just rights of the community. Denying the existence of common rights in land creates a condition of society wherein the exercise of individual rights becomes impossible for the great mass of the people.

WE THEREFORE DECLARE THAT THE EARTH IS THE BIRTHRIGHT OF ALL PEOPLE.

(Originally declared at a meeting of the International Union for LVT in 1949.)