This BBC interview with Grover Norquist, president of Americans for Tax reform, attracted my attention overnight.

As with President Obama and challenger Mitt Romney on the subject of taxation, Norquist is partly correct: taxation and excessive government is indeed a problem. As it has always been, it is the stuff of revolutions.

But Norquist’s well-researched data and detail is simply part of the mindless bifurcation on taxation in American politics (and elsewhere), where both sides have latched onto only a glimpse of the truth.

Add a layer of party politics to this partial truth, and the argument for each party boils down to: “We’re right and you’re wrong!”

Is it possible there could be a third alternative which offers enough common ground to resolve this seemingly irremediable impasse on taxation?

What if we were to agree with Norquist that ALL taxation is indeed theft, but that a certain amount of revenue is essential if any mixed economy is to be workable?  (And it is a mixed economy, surely, Grover?)

What if we were to agree with Obama that the wealthy haven’t been carrying their fair share; that, in fact, the 99.99% have been ripping off the middle class.

So, what remains which might bring such warring parties to common ground?

How about the common ground itself: the land?

A community charge, based on the value of land held, is NOT an arbitrary tax: any decent economist will tell you it’s a rent in nature. It can’t be passed on in prices like a tax and, if used to abolish other taxes on labour and capital, this must surely free up labour and capital to generate real wealth?

But, no, I rather suspect Grover Norquist’s interests are not in resolving the revenue quandary, but in ensuring the poor and middle class continue to lose out badly to the 0.01%–the parasitic rentier class–which has brought this economic depression upon us.

I may be wrong, but it sounded like Grover Norquist remains in love with the disgraced ideas of Ayn Rand.

AUSTRALIA’S SUPER SYSTEM IS A NATIONAL DISGRACE

ACCIDENTS AND IRONIES

I kept accidentally running across memorials to Alexander Hamilton in my recent visit to New York: his statue in Central Park, his grave at Trinity Church Wall Street (when speaking with “Occupy Wall Street” participants), and the former US Custom House also bearing his name (now being used as a disappointing National Museum of the American Indian).

I couldn’t help wonder how Alexander Hamilton, as first Secretary of the Treasury and founder of the Bank of New York, would regard the current parlous state of the United States of America’s finances.

Although Hamilton was not without his foibles, I consider he was a man of principle on matters of national finance and would have had no truck with the shenanigans of recent Secretaries of the Treasury nor those Wall Street banksters who proffered credit into a land price bubble.

We stayed on 44^th Street between Sixth and Seventh Avenues, near the Durst Organization’s debt clock.

I almost collapsed in a fit of supreme irony that the debt clock, funded by a big real estate agency, actually abuts an office of the Internal Revenue Service!

Is it not banks, real estate agencies–the latter unanimously opposing land value taxation–and the IRS that are entirely responsible for the national debt? (Well, if you’ve followed the contents of this blog you’ll know exactly what I mean.)

The point, no doubt, is lost on the successors of Seymour Durst who are co-redevelopers of the One World Trade Centre, together with the Port Authority of New York.

Whilst I’m pleased Durst is engaged the latter, I wish the developer/agent could understand that taxing labour and capital (instead of land values) is responsible for the figures tracking towards $17 trillion on their national debt clock.

Whilst in New York I went along see Ayn Rand’s “Atlas Shrugged”.

What a shocker of a movie!  What a heavy-handed attempt to ensure that uber wealthy rent-seekers should remain free riders and not have to pay their fair share!

“Who is John Galt?”, indeed!

Ayn Rand’s impact on the Thatcher-Reagan era has been undeniable.  Are not the results of Rand’s pernicious influence patently now about us for all to see?  Namely: lower real wages since 1972; higher household debt; dangerously narrowing small business margins …. but obscene profits by banks and other rent-seekers.

Yes, and increasing government intervention has necessarily flowed from all these pathologies.

This period has been anything but “free enterprise” in action.

Yet, these people, this 0.01% which has cruelled our pitch and brought about an economic depression, now blames it entirely on government excess and socialism!

Forget their rent-seeking parasitism, and their passing off their responsibilities onto the 99.99%. They themselves are absolutely blameless. “It’s governments wot done it, gov, not us!”

I’ve said it before: their greed knows no bounds.

As if to underline the point, I see a Hungarian-born American billionaire (no, not George Soros), Thomas Peterffy by name, is taking out ads on US TV saying in effect “Leave us alone – or else you’re being socialist!” Maybe Peterffy also helped fund “Atlas Shrugged”?

No, Ayn Rand, Maggie Thatcher, Ronald Reagan, Tom Peterffy, et al – you’re wrong.  Whilst creeping socialism has been a pain, your actions have proven to be far worse.

Certainly, bloated government has aggravated the situation, but there is, of course, a third alternative which you fail to mention (and has not been tried) that frees up enterprise whilst precluding the rentier class from stealing from  the people, in order to make themselves billionaires at society’s expense.

It’s called Georgism.

Socialism failed; monopoly capitalism has failed; maybe it’s beyond time to try free enterprise?

Make no mistake about it, this global financial collapse is not about capitalism. Not at all. We have been playing Monopoly, and lost – badly.

There can be only one winner in the game of Monopoly—The Biggest Rent Seeker—and in the real life version he has won out twice. Once he had taken our trillions by way of mortgage indebtedness, when it became impossible for us to pay him anymore, he even got the umpire to make good his shortfall.  Not bad work, eh?

A new Harper’s Magazine special feature tells us Monopoly was originally invented in 1903 by an actress by the name of Lizzie Magie. It’s a most interesting account.

But Lizzie obviously had a spiritual side to her, because she supported the ideas of Henry George, so she nominated it as “The Landlord’s Game”.

Dead boring!

Superficially alter a couple of things here and there, as Charles Darrow did 30 years later, call it “Monopoly”, patent it under your own name (now there’s the typical underhanded real monopoly for you!) and you have a winner in which there’s great fun: something that matches real life a little closer – sending all your opponents to the wall.

OK, Rent Seeker, now that we’ve all been sent to the wall, where does your game go now?

It’s clear there’s no such thing as bringing an open mind to address US foreign policy.  That’s seen as a weakness.  It’s largely about bluff,  and sabre-rattling bravado.

Mitt Romney knows this and exploited it to Barack Obama’s disadvantage in the meantime.

The President has got the message, but lost a few points on the issue .

On economic matters, Romney came across well, but he has the US depression on his side because, like Australians, the American swinging voter is greatly influenced by how he or she is travelling financially.

Obama performed well oratorically, though.

However, although it’s not usual for an incumbent President to be thrown out of office after his first term, the upcoming election is likely to be a close one – because the economy will be the main issue with the people.  I’ve taken the time whilst  in the US to speak to people, and the economy certainly comes out as THE issue.

Tragically, although both candidates for the leadership of the world’s greatest economy know a healthy real estate market is essential to running the show, neither understands how to bring this about.

The purpose of this site, of course, is to attest to the fact there’s only one way to create a genuine free market in real estate.

The long term economic outlook for the US, and the world therefore remains bleak – bleak in the extreme – whoever wins the November election.

Andrew Liveris, Australian chairman and CEO of the American multinational Dow Chemical Company, gave a near-brilliant speech to the Australian Press Council on Thursday.

The following day, Liveris actually replaced Jamie Dimon as chair of the US Business Council.

It is potentially good news for America that a wealth-creator replaces a failed member of the FIRE (finance, insurance and real estate) service sector which was allowed to run amok during the course of the real estate bubble.

Let’s hope Liveris’ appointment proves to be more than a symbolic move for America.

Near-brilliant speech?

Yes, it was indeed inspirational but it failed to perceive another option. One that might turn around the near terminal decline of Australian manufacturing and help establish an advanced technology sector.

Liveris wants cheap access to natural resources but doesn’t call that rent-seeking.

How about this as an alternative then, Andrew?

Pay the full rent for Australia’s gas and energy, and we’ll abolish all the taxes on your manufactures? You appear to have missed this as a serious option. Why?

Surely this alternative would blast a hole through manufacturing industry worldwide and give Australia the inside running?  Wouldn’t this also be attractive to Dow Chemicals, Andrew?

Don’t miss Andrew Liveris’ compelling address here.

Andy Moore, Prosper Australia president, has it pretty right in this neat little Prezi presentation.

It was generally an intelligent, robust debate.

Except for one thing.

Both men realised changing the tax code is central to resolving the financial crisis.

However, it was as though they’d both forgotten what generated the collapse …. this economic depression.

It was the greatest real estate bubble in the history of the world, guys – because the tax system fines labour, capital and productive enterprise and rewards real estate speculation, just as it did in Ancient Rome (Latifundia perdidere Italiam), and in the 1880s and the 1920s.

Someone erase your memories on this point?

And, of course, the proper response is for the tax code to give the right signals – by freeing up labour and capital and making people pay an annual charge based on the value of their landholdings.

It aint rocket science, but it would challenge the 0.1%, guys.

And you’ve shown neither of you have the ticker for this.

Or are you both so economically illiterate that the concept hasn’t even registered with you?

The principle behind council rating is not understood within local government.  If it were understood, municipalities couldn’t possibly allow the construction of improvements to be penalised by taxation as in some Australian states and many overseas countries.

This is because the salutary wide-ranging effects of (even low level) land-based revenues is greatly underestimated, and therefore ignored.

My blog overflows with mention of the many social problems stemming from the failure to capture publicly-generated land values.  It’s riddled with examples.

The Land Values Research Group has done a number studies showing the many benefits of public capture of land rent as an alternative to taxes penalising labour and capital.

All the studies on local government rating in Australia, and the Henry Tax Review point to the efficacy of land value taxation–a misnomer, BTW: it’s a rent–but governments of all persuasions are usually too scared to implement it these days because the property lobby doesn’t like land as a revenue base.

And the property lobby is powerful. That’s why we have the rotten tax system we have.

We seem to accept taxes being stolen from our earnings, but not foregoing some of the uplift in value that public works and government provide.

Politicians, such as Janine Haines, have been misrepresented and vilified when they’ve advocated land tax ought to be used to replace other taxes.  It’s very easy to scare the horses with the cry: “They’re after your home!” After all, a man’s home is his castle, isn’t it?

In Canberra, this scenario is now repeating.

For a change, one party has had the gumption to propose greater emphasis on LVT in order to reduce other damaging taxes.  An election is swinging on it.

The other party is involved in the usual tactics of scare.

In these circumstances, Jack Waterford, editor of the Canberra Times has come out with a strong editorial.

Thank goodness there remain some newspaper editors who’ve not sold out to the property lobby.

Well said, Jack!