We’ve been absolutely inundated with TV accounts of Hitler and WWII. But I’ll bet you’ve never once heard the reasons for Hitler’s rise?

Did you know, for example:

1. That following the introduction of the rentenmark in 1923, the German ‘recovery’ from hyperinflation immediately moved into corruption and speculative land price bubbles?
2. In 6 years, land prices rose by 500% in Hamburg, and between 700% and 100% in Berlin.
3. It was “good business” to be on terms with the Berlin City Council regarding proposed new train lines. Corruption ruled.
4. In fact, if you were in the know with Berlin’s traffic dictator, he’d let slip details about Alexander Platz being extended and to have a giant underground station built beneath it.
5. It was complete speculative madness, and land speculators could double or treble their fortunes overnight.
6. This came at a vast price for ordinary Germans who, seeing and suffering from all the political corruption, sought relief from a saviour.

Guess who, mateys?

When do we get to hear this story? It’s all here: written by a bloke who witnessed it and was jailed by the Nazis.

Sort of reflects what’s been happening here recently, doesn’t it?

But world political systems aren’t running awry like that today ………….. er, are they?

The late Tony O’Brien had an inkling in 2001 how this was likely to end.

At present, the western capitalist world divides into either a left/labour/social democratic stream, or the right/capital/libertarian stream, depending on the emphasis the followers of each place on the workings of the economic system.

What if there’s a more nuanced approach, blending the best ideas of both ‘labour’ and ‘capital’ adherents, by acknowledging the damaging role of the income that flows to land ‘ownership’?

When neoclassical economics came to confound land and capital, it ignored that income flowing to land is extractive in nature and comes at great cost to both labour and capital. What if land rent, being unearned were to be taxed away, instead of taxing productivity?

The world’s heavily indebted rent-seeking economies indicate it may be time to revisit the ideas of classical economists, Adam Smith, David Ricardo, JS Mill and Henry George (amongst others). They understood the need for public capture of ground rent (which would include electromagnetic spectrum rents these days), for capitalism to work properly, where each of labour and capital would receive their earned reward.

Just a thought.

From Dr Gavin Putland

Is there a deeper tale here?

And Blackstone’s into that, too!

Clever?

No – obscene!

Thank God for Australia’s health system!

This always gives me a chuckle. Thanks, ‘Enid Blyton’!

not to forget ….

I enjoy Max and Stacey making me think differently about asset markets on “The Keiser Report”.

Episode #1445, with Mark Yusko of Morgan Creek Capital, grabbed me when Yusko argued and emphasised that “Price is a liar!” We need to ignore volatility and look for fundamental value.

That’s spot on!

That applies particularly to land price! I’ve argued <– here that unimproved land will usually have a value, unless it’s located somewhere out in a desert ‘beyond the margin’, but if we were to take proper care of ourselves, a piece of land located anywhere should never have a price.

That’s right: all land prices should be zero! It’s only produced items having a cost of production that should have a price. Unimproved land has no cost of production.

Nil land price would be the position, of course, only if we were to capture the full rent of sites to the public purse, instead of taxing productivity, as we do now. Were we to take the site rent, there’d remain nothing to be capitalised into a price. Sites would still have a value reflecting their size, shape, topography and surrounding services, but they’d have no price. Simple.

With the average land price share of real estate values in Australia currently exceeding 70%, a nil land price has enormous positive implications for generating a lasting prosperity, especially as land rent can’t be passed on in prices as taxes which cascade down through every stage of production and distribution are.

Land price is a wraith habitually halving (approx) at every recession, creating financial havoc. It shouldn’t exist. Land price is a liar!

It doesn’t matter whether it’s ignorance or conspiracy keeping people in the dark, because:

“The people themselves must think, because the people alone can act.” -Henry George, “Social Problems”

Thinking, rather than overly-sophisticated nonsense, will help to solve problematic issues.

Genuine solutions are usually quite simple.