property rights

I noticed in the "Golden Dozen" today a post by Paul Walter last week concerning the Tories making a lot of noise about how they would bolster the right to "self defence" when you or your property are under threat. Whilst difficult cases like that of Munir Hussain make bad law, such things are far from the mind of politicians in election time and "my right to defend myself" clearly makes a good election slogan amongst a certain section of the population who feel that the rights of criminals have been taken too far, as witness a couple of elections ago a similar outcry about the fate of Mr Tony Martin, the Norfolk farmer who killed a fleeing burglar with his shotgun, and was subsequently convicted of manslaughter.

Conservative concern might be laudable, if it weren't for the very inconvenient fact that they, just like Labour, have been compliantly complicit in the long term policy of steadily disarming law-abiding citizens and rendering them less and less able to defend themselves and their property, whilst at the same time ensuring that when you need them, in such circumstances, the police are like as not going to be as far away on the other side of the county as they could possibly be.

Yet for all the bravura about banning one weapon after another in recent decades from all our political masters of whatever hue, prohibition in this as in so many other areas of prohibition has made the problems worse.  Gun crime is higher than it was in 1996 when the public outcry for "something must be done" led to the banning of nearly all effective handguns.  We all know the stories of the rise of knife crime on our streets.  The fact is that with a disarmed citizenry, and a seemingly ever more remote possibility of a timely police response, it is now the criminal that is routinely armed and the victim that is routinely helpless.

By way of an aside and example, a few weeks ago we had some intruders on site trying to steal bikes.  One of our students caught them in the act and rescued three bikes which he took into his flat while he called out the warden.  Although they were just kids really, these would be thieves were no ordinary cut-it-and-run types though; while the warden was on the phone to the police, using 999 as instructed when the perpetrator is still on the premises, these kids were running round and round the block, banging on the windows of the flat into which the bikes had been taken, threatening the occupants and so on.  But no, the police switchboard was more interested in the colour of the bikes, and no, there would not be a 999 response, and lo! half an hour later, having managed to get our own private mobile security on site first who managed to shoo them away, along pops two PCSOs, yes, you guessed it, on bikes, to take down more details.  And all on a Sunday evening, when you would have thought that the doughnut shops were all closed and the pubs and clubs relatively quiet!

But anyway, back to the gripe.  You see it does not matter whether you call it "reasonable force" or whether you try to make some vacuous and vain change in the wording of the law to "not grossly disproportionate force" (whatever that may mean); it is the political classes of all parties in this country who have left the victims of crime defenceless and unaided.  They can make all the hullabaloo they like; they have brought us to this.  Political point scoring will not wash here.

And this is where anarchists, and the idea of "private law" we espouse, is head and shoulders above any of this silly legislative willy waving which will just result in more courtroom consternation and a bigger statute book for government to finance from our pockets.  "Justice" in a private law society is simple.  It is based on the "non-aggression principle" and the respect of society for property and contract.  You see, "non-aggression" does not entail pacifism.  If someone attacks or threatens you or your property you may defend yourself and your property.  But the "non-aggression" principle applies to you as defender as well.  If you go beyond the force needed to to make you and your property safe from immediate threat then you yourself are stepping over into the role of aggressor and the now victim, who was attacking you and yours, has every right to legal redress against you.

It doesn't need reams of legislation.  Just the "natural law" right to be able to resist aggression against you and yours.  And you may be armed in the process.  It's not up to the State to say who can and cannot hold a firearm or a sword stick or wave a knife at a threatening intruder under such a system.  But, since everyone would, in a market anarchist system, almost certainly need to be insured against claims made by others, your insurance company is the one who will authorise whether you are the sort of person they will insure with or without a weapon that might, in the hands of the responsible user, effectively deter an intruder for little cost or harm but in irresponsible hands cause them to bear the liability for you pumping the paper-boy full of lead and claiming he was an intruder!

As Aleksandr says, "Compare the meerkat; simples!"

Now lots of people baulk at a perceived notion that libertarianism is fixated on private property.  They feel that it is indicative of an incessant right wing-ish obsession with accumulation of wealth and devil take the hind-most (who will, obviously, they assume, have no such private property: wrongly of course - for we want everyone to be able to accumulate enough property to enable them to gain financial security and so on).

In fact of course the statement in the title, "property is freedom", comes from Pierre-Joseph Proudhon, with whom most people associate a. anarchism (which many seem to think of as somehow not "right wing-ish" - if libertarianism is "right wing-ish" - which it is not but never mind; I don't want to get into a left-right debate here), and b. the more famous dictum that "property is theft".

And it struck me the other day, while listening again to Murray Rothbard's "For a New Liberty" (of which you can listen to an excellent free audiobook version in individual chapters at the Mises Institute), that actually the really important thing about property and why it occupies such an important place in libertarian is little to do with material wealth accumulation.

Actually it's two big reasons, the first of which I don't really want to get into here - that private property, as opposed to communal property in particular, creates the right sort of economic incentives for individuals to want to work to support themselves and keep their property in good order - if they get to keep the product of their efforts, the property which results, they are incentivised to do well. 

But it is the second big reason that I want to highlight now in the context of "property is freedom":  respect for private property rights and the voluntary contracts that give rise to them is key to eradicating the state's (often contradictory) interference through legislation.

Take, for example, the right to free speech.  A right in theory at least at the very root of liberalism - for if you cannot be free with your thoughts, and with expressing them in speech or publication, is not the state constraining your very being?  But we've all heard, and many accept, the idea that there must be some kind of "limit" on free speech, such as not being allowed to yell "Fire!" in a crowded theatre because of the harm that may cause to panicking patrons.  Well, libertarians do not need such a contradictory limitation; because of our respect for property and contract.

To yell "Fire!" in that crowded theatre is a breach of contract of the basis and conditions on which you and the other patrons are permitted in that theatre by the owner - to watch a performance.  Any harm caused by your actions will either be breaches of their contracts, or damage to their property, and properly actionable through private actions on their behalf.

By the way, you can hear more about the "Person who yells "Fire!" in a crowded theatre" from Walter Block's book, "Defending the Undefendable", also at the Mises Institute.

Many think that anarchy means a complete lack of order, or a lawless world in which the vulnerable for whatever reason will be preyed upon by all those vicious racists, homophobes or whomever that we have created many dubious restrictions on free speech to curtail.  But let's say I own a particular street, I charge my customers for using the street, and they, in turn expect me to provide a safe environment for them to traverse.  So I get to set the rules; the protection agency contracted by my insurance firm makes sure everyone feels safe, ,is not intimidated by racist thugs or whatever.  After all, I may be liable to my customers if they are hurt while in my care, on my property.

Proudhon called all these associations developing civil society "spontaneous order", driven not by what a few people who solicit your votes every so often want, but by you and everyone else going about the myriad of transactions of your every day lives.

Oh, and while I'm at it, I'd probably want to make sure my street was gritted and safe for my customers in the snow too, maybe even get a few more customers if other street owners didn't bother so much.  I can't say my local authority is a "customer focused street owner" at the moment, can you?  It is because of respect for property and contract that all this can happen and, just as important when compared with the state's way of doing things, that the money flows to the services that people actually need, because, well, they're paying for it and can demand what they've paid for.

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I am a "land taxer".

Some people seem to believe one cannot be both. On the one hand, we find people like Lib Dem Matthew Huntbach, who in the comments to this Lib Dem Voice piece on my opposition to the suggested "Mansion Tax" claims that as a self-described libertarian I am likely to drop the idea of land taxes, however much I may talk about them (much more than him I'd wager but there we are) as soon as the opportunity to enrich what he thinks of as my fellow wealthy libertarians allows. For the record, I don't think that I know any truly wealthy libertarians or anarchists, and indeed I know of not a few who, despite being not very well off at all, subsisting on benefits, campaign actively for the destruction of the welfare statist system that seems to sustain them at the moment. On the other hand, we find lots of other libertarians who resolutely refuse to accept even as libertarian those who would appear to want to "confiscate" the value of private property in land they hold as a near sacred element of libertarian thought.

Now I realize that one blog post by an insignificant in Oxford is not going to settle this argument once and for all. Far better economists and political theorists than I have tried. But it is a personal battle for me, because it was the ideas of Henry George that brought me to libertarianism - for his is a libertarian idea, in direct response to the "land question" raised by so many in the history of liberal and anarchist thought - from Locke, Paine, Proudhon, Spencer, Mill, and the individual anarchists Spooner and Tucker. And it is as I have heard, read and hopefully understood more by the likes of the Austrian school market anarchists that my views on George's "single tax" solution have been challenged. Yet I still hold them.

First, a bald statement: I do not believe there are many libertarians of whatever branch or flavour (and we are truly a Baskin-Robbins ideology on that score, whatever the misinformed Lib Dem detractors believe) who do not appreciate that there is an issue of equitable access to land - that which has historically been called the "land question" by many (including Murray Rothbard [pdf] even as he criticized Henry George's solution to it). Sure some place more emphasis on it than others - but I really believe that any who denies there is any issue has not thought terribly deeply about it. I'd go further - that before the early part of the twentieth century it was a touchstone of most or even all of the emerging theories of libertarianism and anarchism; that the four "great monopolies" - of land, of money, of intellectual property and of government - that the individualist anarchists and mutualists described were commonly held to lie at the root of the inequity caused by the statist systems of privilege which they wanted to smash.

It may be that it is merely a difference of emphasis. George, for example, like Proudhon believed that the land monopoly was the "mother of all monopoly" and that solving that, for Georgists as for Proudhon, will tend to render the other three insignificant. When we sat down to discuss the content of the Lib Dems ALTER's recent book "The Case for a New People's Budget" I wanted it to include pieces on the money system and intellectual property but one of the other editors, a better schooled Georgist than I felt that such was completely unnecessary, since solving the land question would solve these others.

On the other side, the Austrians today believe, perhaps, that the fiat state controlled and cartelized money system is at the root of monopolistic behaviour and that sorting that out will render the others nearly insignificant. To this extent, whilst we acknowledge there are other problems, if all we are saying is that sorting this one or that one out first will resolve those others, we are, by different means, aiming at the same ends, of equitable economic distribution of scarce goods.

Others still acknowledge that there is an historical problem - that most land title ultimately and historically descends from aggression or statist privilege - such as monarchs kicking off serfs to give rewards of land to favoured courtiers, or the state sanctioning enclosures without any recompense to those who required the land to maintain life and limb. And they might suggest, as in the excellent introduction to libertarianism by Morris and Linda Tannehill - "The Market for Liberty" (available here as a free audiobook) suggest that at the advent of a truly libertarian society such ancient titles would be revoked since they would be next to impossible to prove and that everyone would have to stake their claims anew. But to me this resolves the problem as a "one off" and not the ongoing problem that land distribution necessarily is given the propensity for populations to change and land requirements with them.

Since it is as a result of hearing Hans-Herman Hoppe on the "Idea of a Private Law Society" nearly a year ago now at last year's Libertarian Alliance Conference that I have become more interested in "full blown" non-state ideas, it is, perhaps naturally, to the Austrian School and in particular the Mises Institute that I have turned to learn more; devouring several years' worth of podcasts of the Mises University series, but also listening to various contributers to the FEE's Freedom University series. And whilst they do indeed talk very little about land, I can glean some of the following with which I find myself in agreement that relates to the "land question" in their thinking:

• If we did not have the corrupting influence of inherently inflationary and statist fiat money there would be much less speculative froth in the system to be ploughed into land values.

• If we did not have state controlled zoning and planning restrictions, more land would be made available as development was needed and land values elsewhere would tend to fall.

• If we did not have state enforceable land titles, we would have to find another mechanism for protecting our rights of ownership of land which would tend to release land that land owners felt was uneconomic to protect compared with the utility they got out of holding it.

• And, I really do appreciate the arguments in favour of the protection of private property (well, I'd rather, after Proudhon, say "possession" than "property") being the mainstay of a civil society, that without which original appropriation and therefore economic production would be all but impossible. And allied to this I feel a sense of unfairness that someone who has, in the Lockean term, "mixed his labour" with "land" and thus brought it into production in the first place, might find that simply because others have later agglomerated around his far-sighted piece of appropriation, he would be subject to paying rent on it that may price him off it.

But...and you knew there would be one...what I cannot get round is the idea that, whilst anarchists anathematize taxation as confiscation of the legitimate product of labour and therefore an attack on Lockean self-ownership, the rental value of land is really a tax on everyone else who cannot use a particular location, even though they may have a more productive capacity to use a particular piece. All of us pay for the monopolization of locations of better quality in terms of our needs, than what we are then forced to settle for. If we have to live further away from work, we pay in time and travel costs to get past those locations that would serve us better. These values feed into land values. It is not merely that land value increment is unearned by the land-owner, but it costs the rest of us in like measure. And it is a huge burden - in the UK it amounts perhaps to about a third of what is the salaries portion of GDP. This effect, whilst it may be smaller if all the other Austrian remedies above were implemented, would never, in my opinion, disappear.

Austrians, of course, reject the value theories on which this hypothesis of land values is based - the labour, or cost theories of Smith, Ricardo and other Classical Economists. They prefer their subjectivist or utilitarian theories based on the work of the likes of Carl Menger and Eugen von Böem-Bawerk. And, whilst I also do not agree with a wholly unmodified labour theory, I am becoming more and more convinced by the likes of Kevin Carson's critique of Menger's and Böem-Bawerk's criticism of the Classical cost theories in his "Studies in Mutualist Political Economy" - which is just as well since I describe myself as a "mutualist"!

On the other hand, I am with the anarchists in that I do not want a government or quasi-government institutional structure to value and collect such "rent". And so I am attracted to ideas such as those of geo-libertarian Dan Sullivan in the US, of how it could be handled by a voluntarist system of community management companies. And it is on his ideas that I think can be developed a system that fits with both the Georgist aims of collecting land rents and the anarchist aims of not having government structures impose taxes on us. In his essay "Are you a Real Libertarian or a Royal Libertarian" he says, toward the end:

Can't we do this without the state?

There are, in fact, proprietary communities operating on the single tax model. Arden, Delaware, with a population of 4900, has had no local taxes since 1900. The Arden Corporation collects a fair market rent on each land parcel, which is reappraised annually. (They actually collect only about a fourth of the rent to which they are entitled.) From that they not only pay for all the municipal services, but rebate all property taxes levied by the county and school district.

There are excellent reasons for libertarians to prefer the land trust route over the political route. Private communities can be built on explicit contracts (leases) with the citizens, can have internal democratic processes that are vastly superior to electoral democracy, can be far more flexible and free of state intervention, and can be downright profitable (even with trust investors pocketing a mere fraction of the rent). Most of all, dealing with investors is far more pleasant and self-affirming than dealing with politicians.

But what worries me about this approach, taken literally at least, is that we might end up with one agency acting as a local monopoly that becomes a de facto government, just like Nozick says that private protection would combine into one agency with a monopoly in an area (though I am yet to read "Anarchy, State and Utopia" - I bought it and promptly lost my copy! - and so haven't read his arguments, I instinctively disagree with this as an inevitable outcome) and be to all intents and purposes a coercive albeit limited government.

However, I think there is a resolution. Admittedly I have not gone into this too deeply as yet. I have not followed all the economic incentives through the processes. It is based on the idea that in a "private law society" (necessarily the case of course in a no-state anarchist system), defense of one's life and property would be handled by competing insurance, protection and arbitration agencies.

In the absence of a single, state-provided, system of land titles, one's ability to hold onto a piece of land (that is, not to fight for, but legally to defend one's right of occupancy against any other claims) would usually be handled by your insurance and protection agencies. Of course, you could opt out, but then you would have to pay for such physical protection and legal protection against claimants by yourself and on a simple division of labour basis it is likely to be more cost effective joining with others via an insurance and protection agency system. But your premiums would likely rise to be something similar to the market rent value of the location - because it is on that basis that other possible claimants would be likely to be basing their claims on. If your insurance agency were a mutual agency operating with profit policies, they would effectively disburse the equivalent of the statist "citizen's dividend" to the members with with-profit policies.

Here, there could be competition. My insurance agency would make a (probably class action on behalf of all their clients inconvenienced by your monopoly holding of land that costs us money to avoid) claim against yours, yours would pay up and that would go into the profits of my insurance firm for distribution to the with-profits members. And these firms could compete across whole areas of productive land. So, for example, you couldn't have only those in expensive locations in Mayfair joining together and insuring against each other and effectively doing so cheaply because you're hardly likely to lay claim to your neighbour's similar property if it's going to cost you money and you're both pretty happy with your lot and are not costing each other anything by your occupancy of neighbouring sites. My firm may be based in Sutton or Dagenham and have most of its clients there, but will still be likely to be making claims against yours.

Eventually it is likely that these individual claims would not be processed at all, but that reciprocal arrangements between these agencies would spread premiums around amongst them such that the dividends paid to each one's clients would tend to even out, but all the same, the claims mechanism would remain available where there were disputes, just as, for land taxers operating within a state system, there would be tribunals to adjudicate on land value disputes.

UPDATE:  I've thought of perhaps a simpler way of understanding this - it might be looked on as competing land registries paying each other premiums for recognizing and upholding each others' clients' titles.  Does that make sense?

As I say - I have not followed the economic incentives right through such a system. But I think it contains the germ of a possible solution that does not rely on confiscatory quasi-state bodies but does equitably distribute the values created by and paid for in other ways by all who need to use land within an agglomeration area.

Remember please, this is a genuine search for a reconciliation between two sets of ideas with which I generally agree but which in contemporary libertarian discourse seem to be all but irreconcilable. But if you've read this far, I'd love to hear your responses.

Charlotte Gore's started a discussion looking for an argument that would enable us to counter the assertion of an interlocutor of hers, Joe, to the effect that the "social contract" trumps "civil liberties". IanB and CountingCats have both had a go at suggesting arguments, and there's been plenty of good discussion in the comments to all three posts - far more eloquent than I am sure I can manage here.

Now naturally, lots of discussion of the "social contract" centres around whether we have all entered into this contract, if it is a contract at all, and if we have, whether we did so voluntarily, and what the alternatives are if one claims not to have agreed to it. Do we enter into it merely by being born, or merely by living in a territory with a more or less democratic government that asserts such a contract as the will of the majority for the time being? What if we do not vote - are we agreeing to it or repudiating it? If we say we are repudiating it, or never agreed to it in the first place, is the only option to go and live in some other jurisdiction?

Now I don't want to rehash any of that here, but rather further to explore a line that NickM, also at Counting Cats in Zanzibar, seems to have begun to explore in his contribution to the debate, namely that we are all individuals, unique and irreducibly so; that we cannot experience exactly what another experiences without somehow becoming that other and abandoning ourselves. This, he says, rightly, is ignored by any kind of social contract.

I want to go a little further, however. I want to show that the social contract is by nature totalitarian, and amounts to enslavement; both of which I am quite sure Charlotte's original sparring partner, Joe, would recoil from in horror.

We can deal with the totalitarian issue very swiftly; it hardly needs more than a sentence. If the social contract is something which we are all deemed, somehow, to have agreed to, by birth in a particular territory or adoption of that territory and its government by immigration, and we cannot get out of that contract except, as is commonly argued, by moving somewhere else outside that territorial jurisdiction, then surely it conforms to Mussolini's dictum of "Everything in the State, nothing outside the State, nothing against the State." Simply substitute "social contract" for "state" in that dictum to see what I mean. To escape this charge of totalitarianism the social contract would have to be explicitly agreed to by everyone who wanted to and an accommodation made within that territory for those who didn't so agree.

The claim of enslavement does require a little more exploration though, I will admit, and in doing so I enlist the assistance of the contemporary Austrian economist and anarchist philosopher Hans-Hermann Hoppe. Hoppe has written about this many times, but perhaps the best piece for my purposes is his "The Ethics and Economics of Private Property". In this he explains the logic behind the age-old anarchist and liberal (such as in Locke's "Second Treatise of Civil Government" enunciated first in Chapter 2) ethic that we have an inalienable right to "self-ownership".

All of political economy is directed at finding a solution to what he calls the "problem of social order": in a world of scarcity we need to find a way of managing, preferably avoiding, the conflicts that are inevitable when some good or other is scarce. This, even Hoppe the anarchist agrees (as do all thinking anarchists), will require some rules governing who has the right of ownership of scarce goods. But even in a world of total plenty, where nothing else is scarce (in Hoppe's analogy this would be the "Garden of Eden"), two things are nonetheless still scarce: ones-self and the ground one's own body occupies. So if nothing else there needs to be a universally applicable rule about who owns, has the right to control, one's body and physical faculties.

If you attest that you do not have the right of self-ownership, there are two alternatives: that someone else owns you, or that everyone owns each other in common. If someone else owns and controls your body and faculties, it cannot be a universally applicable ethic, since it creates two classes of people, those who own and control themselves and also the bodies and faculties of others, and those who do not own themselves because they are owned by others. If everyone owns everyone else, then whilst it satisfies this idea of a universal ethic in that the same rule applies to everyone, it is an impossible arrangement, since if everyone needs the consent of all his owners, i.e. everyone else, to do anything, then everyone also has to obtain the consent of everyone else in order to permit the first to do anything, and so on ad infinitum.

This, one might argue, is where a "social contract" becomes useful and legitimate. To get round this problem of everyone having to have the permission of everyone else even in order to consent to someone else's actions, they may establish some form of collective government to take the decisions on everyone's behalf. But in that case we are back creating two classes of people, the rulers, who have the ability to control everyone else's bodies and faculties on behalf of everyone else, and the ruled, so we are back to a problem of it not being universally applicable. As Hoppe says elsewhere, this norm of self-ownership is not merely a convention; for a convention is something to which an alternative exists that you simply choose not to use. There can be no legitimate, logical, universally ethical alternative to self-ownership.

So, a "social contract" denies the possibility of "self-ownership" and when one does not have a right to self-ownership one is, to a greater or lesser extent, enslaved, if not by an individual, then by the collective. And, whilst it is possible voluntarily to submit to some degree of enslavement, if it is to be an act of an individual with an a priori right to self-ownership, such a "social contract" must, once again, be voluntary and explicitly agreed to.

Those who assert that we must implicitly agree to some "social contract" then, are demanding that we submit to the two things they would probably most revile: totalitarianism and slavery.

NOTE: I have deliberately steered clear of touching on aspects of ownership of property external to ourselves. As most of you know, I myself have some conflicting opinions on, for example, ownership of economic "land" - scarce goods of nature including land itself. But more importantly, if I have successfully demolished the idea of a "Social Contract" solely on the incontrovertible right of self-ownership, then discussion about legitimate rights in property other than our own bodies becomes the subject of a separate debate about how to manage such rights in a system without an inherently coercive "social contract".

I don't normally do the "fisking" thing as I find it quite tedious to base a post pretty much solely on someone else's. But this is different. Richard Murphy, who runs the "research" group called "Tax Research UK LLP", recently produced an extraordinary rant about libertarians who had had the temerity to comment on his blog. Libertarians are, he seems to believe, neo-Victorian, un-Christian, sociopathic, contemptuous, vicious, self-interested enemies of civilized society who are as repugnant as racists and ought not to be allowed to have a voice in any sensible media outlet, especially his own blog (of which he has, I suspect, a more overinflated opinion than most of us do about ours) and the Guardian, which patronizes him by allowing him far too many column inches.

"Naming libertarians for what they are": July 13th, 2009

Traffic on this blog has been very high of late. I have noted (and those who read the comments on this blog will also have noticed) that my blogs in support of government spending – which is the only (and I stress only) way to avoid depression in the UK and other economies - have not gone down well with the libertarian community. They think that all tax is theft; all government activity is bad and those who win a mandate for government spending from democratic electorates are ‘statists’.

Interestingly, or not, I went off and had a look at the OED for "statist" because whilst it seems always to be used as a pejorative term it must have a "real" meaning somewhere. There are several definitions, some of which clearly do not apply:

1. One skilled in state affairs, one having political knowledge, power, or influence; a politician, statesman. Very common in 17th c. Now arch.

Hmm..."skilled in state affairs"? I think not!

2. One who deals with statistics, a statistician.

Given some of what Murphy produces, I suspect not!

3. (With capital initial.) A member of a conservative Belgian nationalist party which sought to maintain the power of the provincial assemblies or States in the late eighteenth century.

Still a no then...

4. A supporter of statism.

A-ha! Yes, indeed, that looks more promising. So what is "statism" then? We find...

Statism: 3. a. Government of a country by the state, as opposed to anarchy.

So, yes, the very definition of the word, even if not used pejoratively, describes Murphy quite well. He does believe that the state is essential and government basically a good force. As he describes it in glowing terms, his is a way in which people "win a mandate for government spending from democratic electorates". When last did any government in this country have a "democratic mandate"? Even getting more than fifty per cent of the votes of those who actually bother is quite rare, let alone any kind of true majority mandate - i.e. a majority of the whole electorate - which I doubt has ever happened. At the moment we are ruled by what, the choice of just under a quarter of the adult population. A quarter of the adult population is able to decide on how much to take from everyone else who didn't agree with their choice. A quarter of the adult population is able to decide to create thousands of new criminal offenses, some of which, though the penalties are of course not the same, make Siad Barre's outlawing of "gossip" look like reasonable governance!

Democracy is two wolves and a sheep voting on what's for dinner as someone once said. We even have to do it in secret so our neighbours don't find out we've been voting to take more of their property from them! What is tax if not taking property with menaces? If anyone but government did it you'd fight back or expect someone to do so for you and hopefully get your property back, or replaced. All you are doing is using this formula of "democratic mandate" to say that this particular form of theft is justified because a "majority" agreed to it and that it therefore becomes something that is voluntary, consensual, a little bit like the difference between cannibalism and that German chap who volunteered to being eaten!

These people – who wish to undermine society as we know it and who would end all social security, state pensions, public health services, state education and much more besides – want to overturn society as we know it. As one said recently – we should rely for support on our families churches, synagogues or mosques – but not the state.

This would be the "state" that has had years, decades, nay centuries to get these things right and yet still has so many kids unable to read properly before going to secondary school, has 950,000 young adults milling around with nothing to do, decides when people will live or die by refusing to pay for drugs that might save them and denying them the right to chip in for themselves. The state in which even a Labour government in power for more than a decade has presided over a widening wealth gap and has failed even to meet its own targets on child poverty.

As Spencer observed a century and a half ago, "To mitigate distress appearing needful for the production of the “greatest happiness,” the English people have sanctioned upwards of one hundred acts in Parliament having this end in view, each of them arising out of the failure or incompleteness of previous legislation. Men are nevertheless still discontented with the Poor Laws, and we are seemingly as far as ever from their satisfactory settlement."

I suspect that even Murphy would balk at the cost if people actually stopped relying on their personal connections and informal communities.

But why stop at the list of the "bribes" with which government and politicians get us to vote for them, even though they are not as great as they are made out to be? Why not look at the bad things that the state gets up to that will also go on the bonfire: the ability to wage war; the history of mass murder in war and otherwise that all states, including ours, have engaged in; the curtailments of free speech that J S Mill thought democratic government would protect and has failed to do; the prying into peoples' lives; the minute regulation of so much of our lives and especially businesses that simultaneously protect their big business buddies and prevent real competition by making it so much harder for others to set up in business.

This ignores the fact that many are simply outside those communities of support. For them I suspect the workhouse would beckon.

And how many of them are actually trapped in the state of welfare and by the difficulty of doing something about it for themselves because of regulation. Murphy ignores that we hand over half of everything we earn to this state of welfare and other government programs and protection rackets. Why do people like Murphy assume that if, as he says, we "voluntarily" agree to the state taking so much from us to help such people we would not do so voluntarily in the absence of the state threatening us if we don't? If society with a state does not stand for the "workhouse" type of Poor Law any longer why would society without a state suddenly find that acceptable?

This Victorian concept of grudging charity is what these people promote – with the consequence of a random lottery of survival – and destitution for many.

One of the biggest fallacies of the statist is to suggest that without the state we would return to some pre-welfare hell - a pre-welfare hell that is largely a fiction in any case, because the mere fact that government thought welfare was a good idea reflected the fact that people were already doing it. All state provision did was to make that compulsory, subject to someone else's decision. That may have speeded up a more universal provision; but there's really no way of telling - because compulsion and centralization stifled all the alternative attempts, whether doing well or not so well. They were not all perfect, but then neither, after a century of trying, is the state's monopoly version.

It says that we are all by nature entirely unconcerned about anyone but ourselves. What a depressing view of humankind! And one which, despite the predations of the state on our capacity to be generous, is contradicted time and again by conspicuous acts of voluntary kindness day in day out. Yet even if I were entirely selfish, having nearly twice as much money in my pocket without a tax man taking it from me would give me more consumption power, creating more jobs, enabling more people to look after themselves and have something left over for others if they choose.

I do not believe in this callous, self interested view of life. It offends my Christian beliefs that suggest we have a duty as a society to fulfil the instruction – present in all major religions – but not in libertarianism that we love our neighbour as ourselves.

You are the one calling it callous and self-interested, not us. I don't recall Christ saying that we should have someone waiting to throw us in prison if we didn't share our coat. Whilst the bible mentions taxes, it is quite clear that these are not about welfare - and that welfare is a personal, charitable thing expected of everyone who has sufficient for themselves and finds someone in need.  The state, Rome, the Jewish temple tax, are about the upkeep of the trappings of those in authority, nothing at all to do with the injuction to love our neighbour. 

All these major religions do indeed focus on charity for that, not on coercive force. It's even one of the five pillars of Islam. It offends my Christian beliefs to suggest that we force those beliefs on others through a violent monopoly. Indeed, the state seems to me to be quite inimical to such a belief. How on earth can I love my neighbour if I suspect he is plotting to take more of my property from me?

Of course that requires that we love ourselves and that means we have rights – and that they should be respected. But there is no way on earthy civilised society can ignore the needs of others – and tax is the way we meet this need in our modern, complex society in which expectations of medical and social support are high –and the cost of meeting them as high.

Wouldn't we be "loving ourselves" even more by believing that we can achieve all this without the threat of violence with which the state goes about it? We do have rights, the right of self-ownership that the state infringes upon at every turn. Besides, this is an appalling circular argument - we do things this way, so we must do things this way - what a poverty of imagination this man has! It's also economically illiterate - the state, as a monopoly in many of these services has little, or any, incentive to do things efficiently, no free price mechanism to decide whether it is efficient even if it wanted to.

The various institutions, like fiat money, the state has created enable it to spend effectively what it wants. Even the threat of the electorate voting them out once in a while if taxes get too high for a majority of people need not stop them - they can inflate the money supply, as has been seen through this latest decade of the abolition of boom and bust, according to our current dear leader, they can create crises, either deliberately or through incompetence which, because the state is so big, affect every last one of us, as we are seeing now.

Those who say otherwise are not offering an alternative within out society – they are suggesting we tear down our society and replace it with another. In doing so they show complete contempt for many, some (most, I suggest, by far)of whom are in the positions they are through no fault at all of their own. One on this blog has called those in need ‘an underclass’.

An accurate term for the large group of people who are kept in dependency. And yes, I think tearing down the "society" that keeps a stratospherically wealthy elite in place and at the other end of the scale actively prevents people helping themselves. This society that legitimizes violence, but only by itself, on our property and freedoms, on the say so of a minority, no matter how powerful or sincerely held the contrary belief or however much better the alternative idea.

I make clear I think this as repugnant as racism.

I think it's clear that I regard Murphy's defence of this majoritarian thuggery we call democratic governance as repugnant as racism.

I would reject this language from a racist. I would reject a call from the far left to over throw society.

Why is it then that this vicious, self interested and, might I suggest inherently socially violent group are allowed to make this sort of contribution – as they do all over so many blogs where those with real concern for society, from across the mainstream political spectrum, seek to discuss issues in an open, rational and respectful fashion?

Inherently socially violent? Coming from a man defending the practice of theft with menaces, the institution that decides with horrific frequency to go to war, effectively careless of the casualties inflicted, that inflicts the will of a few on everyone else, ,millions of us, by force of law and threat of force, this is an astonishing statement. Of course, we can perhaps understand his anxiety. Murphy's world would indeed be turned upside down by a stateless society - for he would no longer be able to make a living out of helping to enforce state regulation. He himself would have to find something more productive and wholesome to do than promoting this institutionalized violence. And judging by his output, this would indeed be a huge wrench.

I would love, for example, to see far-right libertarians thrown off the Guardian bogs as a matter of course – which might improve their appeal to many others as a result.

The Guardian website is indeed private property. They are free to do this if they wish. I suspect that its appeal, as a forum in which everyone basically agreed and never had their ideas challenged, would be limited.

It is time we named these people for what they are – as being amongst the enemies of civilised society.

I am happy to do that. It would be good if others would do the same – and fight them as we do racists.

What an odious, censorious, weaseley little man Murphy is.

Well, what an unpleasant surprise I had last night. I was bloody stopped and me and my car searched by the police about midnight as I was returning from my friend's house in a nearby village. They said they were randomly targeting vehicles on these country lanes late at night, asked where I had been and where I was going and whether I had had a drink - I hadn't.

So he started on about whether I used drugs: I don't really know where that one came from, though he had seen my roll up fag and asked how long I had been smoking rollies. He asked me to get out of the car and to go and show my ID to his colleague and he had a quick nose around in the car. Now, I have got to be one of the untidiest person you could ever meet, but one think I do hate is people dropping litter and especially fag butts. So what I do when I am smoking behind the wheel, since my car came with no ashtray and lighter, is to twist the fag out out the window and then put the butts into my driver's side door pocket.

I don't know if I've done a proper clean out of the car since I bought it four years ago or so! I do usually empty out the big stuff in the car and do a general binning of the rubbish every so often but haven't done for a while. As a guide - he was asking about a spade in the back seat - which I put in there during the snow in December or whenever it was as I was driving up to my mothers and wanted to have one with me in case I broke down. Anyway - all this, notwithstanding my explanation that the fag butts were about my civic responsibility not to drop litter, made him decide to conduct a proper search of me and the car.

What a faff - on a pitch black country road in the middle of the night he went rifling through all the junk in my car, rummaged through my pockets and wallet and so on. Then came back and asked me, off the record so to speak, to be honest about whether I ever used cannabis. Well of course I do, but it's such a rare occurrence - basically maybe every couple of months when I go for dinner at a particular group of friends' houses, so I never have any of my own. He said "you have a habit, I notice, from the car, that suggests to me that you are a user". He wouldn't tell me what this habit was; he did say it wasn't the butts in the door pocket or the general mess, and that I'd have to work it out for myself.

Well, I haven't got the faintest idea. Unless perhaps he was referring to the fact that there was a Tesco back in the bag with half a dozen empty energy drink cans in - again the relics of several longer distance journeys over the past six months when I have stopped in service stations and I usually buy that sort of thing. So, is that it? I'd never really think of that as a trait of drug using, and I dare say that Sebastian Vettel and Mark Webber wouldn't think so either!

I did notice that he didn't give me his name or number and whilst the female colleague did fill in a search form I was not given a copy - they said it was primarily for the supervisor at the station to record what they had been up to but that I could get a copy from their station (miles away in Bicester) if I wanted.

So much of a reward for going to do a friend a good turn. Do these people get off on stopping and harassing drivers for no observable reason? Jeez!

Absolute bollocks! School bureaucracy (and local state protected monopoly) goes bonkers in cold weather...

Cold war over coat policy 6:30am Saturday 7th February 2009 Comments (13) Have your say » By Hayley Cover » Children had a freezing walk home after a school confiscated their coats because they were not official uniform. Last night, John and Shirley Cooper said they were outraged King Alfred’s Sports and Community College, in Wantage, had not let their son Sean, 14, have the coat back to go home. The school confiscated the coats of four other children on Tuesday. Sean had to walk half a mile to his home in Dean Butler Close without his plain black hooded windcheater. [From Cold war over coat policy (From The Oxford Times)]

I’ve long been wanting to try and address an issue which appears to be a fairly significant point of conflict between various people who would otherwise all call themselves libertarians. A post by our good Devil and the comments that follow it provide a good opportunity. Some there and elsewhere in libertarian groups would even suggest that those of us who subscribe to the opinion that land values are somehow not legitimate private property cannot really be libertarians at all. On the contrary, some would say even that we are crypto-communists for wanting to rob people of the yields from their landed property.

Yet it seems to have been a matter of controversy throughout the history of anarchist and libertarian thought, and both sides even invoke John Locke as the supreme expositor of property rights in support of our arguments.

But let’s start from where we generally speaking agree. We all, I think, would agree that monopoly is inimical to the free markets we would want to see. I suspect we would all subscribe to the idea that we are entitled to self-ownership, and that to a very great extent, self-ownership means the right to own the fruits of our own labour. And I think most of us would subscribe to what Herbert Spencer described as “the fullest liberty to do as [we] will compatible with the possession of like liberty by every other [person].”

I feel most of us also acknowledge that there are some problems in the historical distribution and acquisition of land and recognize that much vested interest has been created through violence or state intervention - either forcibly taking land off others as in many of the enclosures or through grant of title over others’ claims by the state favouring individuals or great families.

But that’s about where agreement ends insofar as land is concerned. It seems that most libertarians view land as a free market in which people are free to participate or not to the extent they wish - to own, to rent, whatever suits them at their time of life or financial circumstances. To use the fruits of their labour to buy up more than they can use for their own needs as an investment and charge others to use it if it has such a value. And that anything that impedes that is theft just as taking away your chattels or other property would be. In fact, I think they also feel that since, as they see it, we are inexorably moving away from dependence on land (most of us no longer have to till the soil for sustenance) the importance of land itself is diminishing and it becomes an ever more free market.

So, before getting into discussion of possible remedies, I want to set out why I think there needs to be remedies to the “land question” as many of us would call it. I believe that property in land breaches the three main tenets of libertarianism I mentioned above: it is monopolistic and therefore not a free market; it exacts a toll on the fruits of others’ labour; and as a result it denies people Spencer’s “fullest liberty…”.

First, some definitions, because I think people get quite confused about just what we mean by “land”. “Land” in the economic sense is not just the earth, the ground we walk on, the soil we till. It is the third factor of production; everything in the material universe not originally created by the application of labour and capital; resources in their “natural state”.

But more than just that, when we are talking about “the ground we walk on” we are really talking about its “location” as much as its extent. A million acres in the Dry Valleys region of Antarctica may, for all we know, have no material value whatever. The few acres of Chelsea Barracks was worth £970 million last year. Similarly, we may yet have no use, and therefore put no value on, one part of the electromagnetic spectrum, but have many competing businesses dependent on technologies that use another particular, finite, location on the spectrum. So we usually mean “land in a particular location”.

Land as monopoly. When Winston Churchill made his “speeches by the yard” on the land question in gathering popular support for Lloyd-George’s land taxing 1909 “People’s Budget” there were of course very much fewer people who owned their own homes than do nowadays. But he was also expressing the views of some anarchists, such as Benjamin Tucker, Leo Tolstoy and Proudhon, as well as Liberals such as Spencer and later Henry George, that the land monopoly was one of the greatest barriers to free markets.

Many today feel that land, especially in the form of property in housing, is much less of a monopoly if at all. After all, in a world where nearly 70% of households live in the home they own, how can it be the monopoly problem of grasping landlordism that it was at the turn of the 20^th century? But the problem of land monopoly has not gone away. In fact, because it is less obvious I would suggest it is more insidious. Every location is in effect a monopoly of its own. A monopoly of the various circumstances, services, links and other infrastructure that make it unique. If you have the only house for sale in a particular school catchment area, the only house within a reasonable distance of a transport link that will allow people to get to the nearest good employment opportunities, or any number of other factors, you have a monopoly.

By and large we can only have one occupier occupying any particular plot - okay, we can build upwards and fit more people on the same plot, but that itself is exploiting the monopoly power of that plot.

Some will say that a monopoly is not necessarily the worst thing that could befall us, after all, if someone owns all the shares in a company that too is a monopoly - you just invest in another one. If someone is the only doctor in the community they have a monopoly, but someone could start another surgery. But we all have to live somewhere. So far as I am aware, pace Patri Friedman’s “seasteading” project, we have yet to find a way of living that does not involve some contact with land - even boats have to moor somewhere once in a while.

So land is a monopoly quite unlike being the only person able to own and admire that genuine unique Picasso. Yes, others may want it, but it does not alter their ability to live by not having it.

Incidentally, it is this monopolistic quality of locations that means it is so easy to bid them up into a bubble, such as we’ve seen recently. All that needs to happen, in our debt-based money system is that the banks have got to be prepared to lend to someone more than the next bidder for the one desirable location in the area. Yes, this can encourage others to cash in and create more opportunities in an area but we remain in a quasi-monopolistic system. Those of us, which includes most libertarians I suspect and certainly all Austrians, who regard the fiat and debt-based money system as the root of all problems should be extremely worried about this monopolistic ability to talk up the price of any individual location - it is, or has been these past few years, the prime factor in enabling the creation of mountains of debt-based money.

Land exacting an unjust toll on others’ labour. If you happen not to be able to borrow enough to get you a home in the optimum location for your work, or your kids’ school, or near enough for relatives to look after the kids when you go out to work or a whole host of other reasons, you may find a place further away, but more of your labour is going to be spent circumventing those more optimal locations.

Or if you have a business, a shop say, and cannot manage to pay the rent for the optimal “pitch” where most people will pass your shop display and be tempted in, you’re still likely to have to employ the same minimal number of employees to get the work done as someone in the higher rent location, but your takings will be lower. If you look at the structure of retail rents in the UK for example you will find that landlords try and capture this difference explicitly - they try and charge a premium based on ever more complex formula for guessing what a business can make in that location.

This illustrates David Ricardo’s so called “Law of Rent” in which he discovered that rent will rise at any particular location to capture the difference between productivity at the lowest priced location relative to the one in question. The huge land values usually found nearest the most lucrative business districts of communities and cities arise directly because people who cannot afford to occupy them have to work harder to avoid those locations.

In its simplest form this is best seen just by having to spend a fortune on your season ticket, an hour on the train to work and so on. Churchill again used to tell a story about the tolls of London Bridge and the landlords of Southwark. Most people in Southwark worked in the City of London as relatively low paid workers. It was the cheapest area they could get within reasonable travel distance of work, their means of sustenance. The parish elders responsible for enacting the poor law support in the parish of Southwark noticed that though most of the community were gainfully employed over the river, they still had to hand out a lot of dole to give them an acceptable quality of life.

London Bridge at the time had a toll, and so the parish petitioned to have the toll removed so that the workers would at least have to spend less getting to and from work. They succeeded in their aim. For a while the dole required fell, but then they noticed it rose again nearly to the former levels. What had happened? The landlords of Southwark had also noted that the workers would have a few extra pennies in their pockets and put up their rents to capture it.

With developments in transport methods and so on of course it is easier nowadays to get further to work and so on, so the gradient if you like at which landlords closer to the centre of things can cash in on others’ inability to rent their locations is lower, but it exists all the same. At some point, on the outer fringes of any settlement, there will always be those locations which are only just “marginally productive’ in which the residents can only just get to work or their other needs and maintain a reasonable standard of living. Ricardo’s Law of Rent says that inside those locations rent will rise to capture the bulk of the difference between the costs of those living further out and those living closer to the centres of economic activity.

Land impinging on others’ “like freedom”. Both of these previous factors combined clearly affect those excluded from the better locations freedom to enjoy the fruits of their labour. This is where Locke comes in. Robert Nozick coined the phrase most often quoted here - the idea of the “Lockean Proviso”.

Locke had said, in his Second Treatise, that it was legitimate to appropriate as much land as one wanted, so long as one left enough, of similar quality, amenity and so on, for everyone else. He also said that we own the earth “in common” with everyone else (note - common, does not mean “collective”). If we are to have self-ownership everyone born (who has to make do with this our only planet on which to eke out a life) must have a common birthright to claim a place to do so. You cannot own the fruits of your labour if someone is always taking some of them off you just to have a place to sleep at night.

That may have been easy in the New World, where there seemed as if there were vast, perhaps unlimited, tracts of currently unoccupied land just there for the taking. But in a more sophisticated economy, one not based solely on one’s agrarian abilities (and let’s face it we all benefit from that agglomeration of humanity into bigger, more specialised, settlements), more and more people will want to settle in the same area both to contribute to and benefit from the economic activity that human civilization affords. At that point, when Locke’s Proviso is breached, and there cannot be “enough and as good left over for everyone else”, land starts to have the two qualities already mentioned - of a monopolistic, zero-sum, market and of exacting a toll on others labour. At that point it begins to have a rental value. The rental value reflects the extent to which Locke’s Proviso has in fact been breached - the higher the rent the more people could make “as good” use of a particular location and the fewer “as good” locations are available.

So that “rent” is not something the current owner “earns”, except by the purest luck of being there before anyone else, so much as something that all the other potential owners of that monopolistic location create; what they have to pay to avoid the previously occupied location.

I’ve already gone on too long in this piece to be able to go into the possible remedies to this situation. All I wanted to show in this though is the problems land in particular as a type of property creates. Problems which all are inimical to the principles of markets and freedoms that libertarians are supposed to stand for.

If the monopoly factor were not of itself enough to make a libertarian think twice about treating land, location, as a species of property worthy of different treatment from other chattels and goods, the fact that it gets its value not by any of the labour the first appropriator expends on it but because of the costs others expend having to avoid it, and the consequent limits on the freedoms of others to do as they please and enjoy the full fruits of their own labour ought to convince them.

As I said in a comment on the Devil’s blog earlier, some libertarians feel that you can’t be a good libertarian if you believe the land market needs some type of reform, I have to say that I find it difficult to see how one could be a good libertarian without acknowledging that land needs some kind of reform because the effects private ownership of rental value of locations are so opposed to the basic free market and self-ownership tenets of our philosophy.

No doubt I will return some time to try to convince you about the best remedies to these problems.

Over at Lib Dem Voice they've printed a biographical piece from the Directory of Liberal Thought about Henry George, the leading proponent of the "single tax" in the nineteenth century that many of us know nowadays as "Land Value Tax" or "Site Value Rating". Several of the correspondents in the discussion following the article felt that they had never really understood, or had explained clearly and convincingly, what LVT is and why it is such a good thing. So I'll give it a go, though many have tried before me, and no doubt many of them more intelligibly.

Land.

Forget what you might think you know about land. In economic terms land refers to the third factor of production. If "labour" is the work that goes into something, "capital" the wealth invested or expended in producing more wealth then "land", in economic terms, is everything else - "the entire material universe not produced by the application of capital and labour." So yes, it includes the land underneath our feet, but it also includes the air, the electromagnetic spectrum, the cosmos, the mineral wealth of the planet, all in their natural states, natural fertility, self-seeded trees and plants, water and fish and non-domestic animals and so on.

Now, billions that we humans number, for most purposes most of these types of land are either unlimited or of indefinite supply. Some types we don't absolutely need to survive. Others we do need to survive. Others are fixed or limited in supply. As far as I am aware, we are pretty well attached to this planet. Every single human born so far has only had the resources of this one planet to sustain them. And since we need it to survive, then we must all, every one of us, have an equal claim on its natural bounties.

In early human society, hunter gatherer family units or tribes would simply range over as big a territory as necessary to meet their nutritional needs. For some, in fertile temperate parts of the world, this may have been a small area.  For others, in less fertile territory, it might be a large area of rough foraging. But of course this sort of isolation, subsistence living, is not very conducive to human development. Through trade we grow, both as individuals and as communities. And as soon as we come together to trade certain locations become more important as places where people meet and we can no longer justly grab as much space as we want without excluding others. It is at this point that land begins to have...

Value.

The value of "land" is its "rent". Just as the cost of "labour" is "wages" and the cost of "capital" is "interest". When natural resources (land) are in infinite supply, so that anyone who wants to use some of it can just take it and there will still be plenty for everyone else, it has no rental value. But as soon as humans get together in clusters, the further we move away from being a agricultural based economy and as our survival is based more on our ability to sell our specialist labour for enough to sustain us those locations where we form our clusters begin to attract rent, because many people are in the scramble to be in the best location for their market.

A landowner might be able to make more efficient use of his location and fit more people onto a particular piece of land, or they might invest in creating a work of art for the discerning occupier who will pay a premium for quality. But the landowner, as a landowner, does not have to lift a finger to contribute to any change in the rental value of that location.

And when we buy our homes, what we are doing is rolling up all the location rent for a number of years and handing it over, together with the capital value of the buildings at that location, to the previous landowner, and usually borrowing to do so. This is a key concept in LVT - we are already paying this rent either monthly when we actually rent, or up front when we buy (but inflated often by the cost of borrowing to afford it). It is this "rent" value that Land Value Tax seeks to...

Tax.

To me, this is a big misnomer, and causes a deal of confusion about LVT even amongst "Land Value Taxers". The Georgist purist like me intends really for the community to share the rent for the locations that are made valuable by that whole community equally with everyone in that community. Shared equally because, remember, we have that equal right of access to the land as our birthright as creatures tied to it for the very stuff of life, and because we all help to create that overall rent value. We more commonly think of a "tax" as an imposition used to fund government spending. The community sharing of rent is really a way of each and every one of us paying everyone else who has just as much right to make as good use of our location as we do for the inconvenience of having to avoid it because we have exclusive rights to it.

The community in question is the area within which land has rental value - technically speaking "within the margin of production". In some cases that may still be just a single town or city - the desert outside Phoenix, Arizona, for example might well tail off to zero in rental value at the end of the irrigation system pipes. In others, it could be an entire country - for example it could be argued that we are such a small country that London creates some rental value almost everywhere in the country.

The effect of this rent sharing is that those in that geographical community, however big it is, whose productivity - ability to earn - means they can only afford to live in the cheapest locations with the lowest rents will get more, perhaps much more, than they pay out in location rent. Those whose ability to earn enables them to commandeer the best locations will be paying into the community rent fund much more than they get out. And the net effect of all that is that we create an automatic, self-adjusting safety net which, if you have nothing else coming in, should enable you to eke out a basic living on the most marginal, cheapest locations.

Of course many of you reading this actually do believe that government is sometimes the best body to deliver "essential" "public" "services" and will recoil from the idea of giving people a basic income for fear it becomes an invitation to idleness. That's fine. For you, the Land Value Tax would be a way of financing those public services. I will tend to try to persuade you to take that one further step and believe that giving people their money to spend for themselves will lead to better and more efficient services in most circumstances.

The single tax.

Now this is the other side of the equation. Nobody who is serious about LVT's benefits wants to add to the current tax bill. LVT must replace other taxes if it is to achieve its most important benefits - of freeing up labour and capital to invest and work in productive wealth creation. And so Henry George called it the "Single Tax" and his adherents were called "Single Taxers". Henry George reasoned that virtually all other forms of taxation constituted tariffs, and therefore barriers to wealth creating free trade. All except tax on land in the generic economic sense affect the resources that can be applied to productive enterprise - labour, capital and, in the end, consumer spending.

And remember, the best thing about all this is that most of us, that is everyone who is still paying a mortgage or anyone who rents anyway from a landlord, are already paying this "single tax" in the form of location rent to our landlord or previous landowner, who have done nothing as landowners to earn that bit of the rent. So reductions in any of these other taxes, such as employers National Insurance, Income Taxes, VAT and capital taxes, feed straight through into more money in our pockets. And not only that, but all the disincentives to work and creating employment created by our complex income tax system and the problems associated with benefits withdrawal rates and tax credits and so on, will be removed.

Nor must you believe that the "Single Tax" only refers to a tax on the rental value of one type of land. There are other finite natural resources that we can rightly claim belong equally to all of us but which attract an economic rental value because they are scarce amongst a given community of users. One can argue for a "Land Value Tax" on the exclusive right to transmit on particular frequencies in the electromagnetic spectrum. Or to fly through our airspace at a particular time and place. You could even describe some mechanisms for taxing polluters as a specialized "Land Value Tax" - though it may not be the best way to deal with such issues.

Common Objections:

"We've already been taxed on the money we bought our home with"

Actually, you've been taxed on what you have paid your rent with - whether you actually rented, or bought from the previous owner by paying over several years' rent up front. Any rise(or fall) in your property's rental value by the time you come to sell it on is mostly accounted for by changes in the location rent, to which you have not actually contributed, as a landowner anyway.

But think of it in a post-LVT world - you'll have paid substantially less for your home, you'll have borrowed substantially less to do so, and you will not be paying all those unproductive taxes on income and capital anyway.

We have plenty of "double taxation" in our current system anyway. I pay tax on my income, but then when I go out and spend my post-tax income on most most goods and services I will pay VAT at another 17.5% and possibly duties. And this is an ongoing double taxation - at least with LVT we're only talking about this effect being felt once - at the implementation date and then not again because all the other taxes will have been ended.

"Land rich, income poor - the "poor widow bogey""

As long ago as 1909 Winston Churchill used to be taunted by the Tories with what he called the "poor widow bogey" - the supposedly unbeatable argument that LVT would be wrong because people who happen to have seen the rental value of their location rise will have to pay more in location rent without necessarily having more income with which to do so.

First, again, think of it in a post-LVT world - you will have borrowed substantially less to acquire the various places you will have lived in your life and you will be paying, if you are efficient in your use of land at least, less in tax in the form of location rent. You will have more to save and invest in productive assets other than housing. If you choose to save for your retirement an amount that allows you to continue paying your location rent till you drop, fair play to you. But the evidence is in fact that there is a huge unmet demand for people downsizing nearing retirement (indeed it is mostly the best off pensioners who are able to do this at present). LVT, because it makes the market in land and locations much more reactive to community change, will more than likely encourage this need to be met.

But in the implementation there is some evidence that a very small proportion of pensioners would indeed face larger bills than they have at the moment. For those Land Value Taxers who would prefer to implement LVT slowly, increasing the rate of the tax over a long period of time, their answer would be to allow such people to roll up their tax bill until they do eventually sell up and move or for their estate to pay. I, preferring the big bang approach, would simply compensate people for the lost land value in bonds which they can use to pay their tax into the future.

"Confiscating the value of our biggest asset"

It is true that implementing the full rent sharing I outline above will wipe out the capitalized rent values that one is accustomed to seeing as part of the "sale price". And it is also true that this will hurt those most recently on the ladder and having just borrowed to pay for that up-front location rent.

But the home you live in is not really "wealth" in the conventional sense. Until you are at the stage of downsizing or selling up completely, the value of your home really only matters in respect of its relationship to the price of your next one. For most of us, for most of our lives, our shelter is a cost of living - either in rent or mortgage payments. And if we have slashed the cost of buying by removing the land value, then we have also slashed the cost of your next home in similar proportion.

Again though, in transition from one system to another, with my big bang approach, those who lose out can be compensated with bonds with which, for example, they could pay off any outstanding mortgage over the new land-free market value. If you take the slower incremental implementation mechanism, again, the loss will be less all at once; indeed you could structure implementation such that it effectively only capture future rises in rental values.

"Impossible to value"

This is the "experts' objection" that it will be too cumbersome to invent a system that values the rent for each plot of land every year. And more than that, that it will be arbitrary. But we know from evidence in on the ground pilot studies that we only actually have to value about one in ten plots that share common characteristics in the form of access to services and infrastructure say. It's also not really too different from the current system of self-assessed income taxes. A game is played out every year with taxpayers trying to minimize their liability and the HMRC trying to catch people out hiding some of their income. And here there is no market to help.

The average mortgage lasts eight years. That means that somewhere around 12.5% of our owner occupied housing is valued every year just to get a mortgage valuation. More in recent years where people have been encouraged to chop and change their mortgage even though they are not moving home.

And then there's the rental market. There will always remain benefits to renting for some in the population - short term workers and so on. So there will remain a rental market. This presents yet more, and really very accurate, evidence on which to base valuations- more accurate once you take away the capital gains aspect of land ownership as landlords will only be investing in a rental stream.

And ultimately the market will still highlight areas where the assessed location rents are higher or lower than investors think they should be. If buyers think the current rents are too high, they are going to offer a discount on the capital value of the buildings themselves and if assessed rents are adjudged too low by the market, buyers will offer a premium over the building values in order to get the more desirable location at a lower location rent until the location rent is adjusted the next year.

And finally, let's not pretend that this is new - we had Schedule A imputed rent on our homes on our tax returns until 1963.

"Concreting over surburbia"

There is often concern that when Land Value Taxers talk about our system leading to more efficient land use we mean that every available inch of land will be developed. There is no reason to think this in reality. It will first bring into use completely unused land - that mouldering old factory that's been sitting empty and becoming more and more of an eyesore for a decade for example.

But there's no reason why Land Value Tax would not be subject to a similar planning regime as now. It would change - because a community decision that they would prefer housing to a factory on a particular site for example will lead to that factory being redeveloped a deal sooner than it might today, because its owners are going to be seeing their location rents rise to the point that running a factory there would be inefficient compared with developing it for housing, say.

Personally I would also like to see many planning controls repealed anyway and have most (ie small scale) developments make their peace privately with its neighbours through mediation rather than state control.

Overall though, there is little evidence that people would suddenly settle for a squashed apartment instead of a suburban semi with garden and garage just because of LVT. It will encourage people to consider whether their continuing use of a particular location is cost effective for them and it will make the market more efficient and so there is likely to be more rebuilding, but that doesn't need to be at the expense of amenity.

In conclusion

So, there then was my now not so concise explanation of Land Value Tax and some brief responses to some of its most common objections. It is quite important to get across just how land gains its value though. That helps to explain why some of us see LVT as such a just and equitable way of doing things. If we had Star Trek style free instant transportation systems, land would again be worthless but while it take time (which is money opportunity lost) and money itself to get from A to B the land in between A and B is absorbing some of your hard earned income (and that of everyone else who has to pass it by every day) for doing precisely nothing.

Land values are effectively a tax on all production and one we already pay anyway. Getting rid of all those other taxes on production and capturing for the community the rental values of land will create such a different more equitable economic playing field on which we all continue to ply our various trades.

There's been much talk, most of it at least tacitly approving, of the restrictions or bans imposed in the past few days on so called "short selling" company shares. Most of you probably don't know that my first career, straight out of school., was as a trader on the stock exchange, followed by stints in several stock-broker firms mostly in private client advice and fund management, before I got into IT - which was as a result of my city experience. That's all a bit apropos of nothing really. After all, you'd be right in thinking that if I had been successful in this first career I might now be funding a think tank or something. But it gives a little background to my knowledge of this issue.

Short sellers, per se, are not the problem here it seems to me. Indeed the stock exchange relies on players prepared to go short - that's what market makers are effectively obliged to be prepared to do when they make a price.

Short selling is also an important way of the market getting the information it needs to make accurate value assessments. Longer term shareholders may have more emotional reasons than pure profit to resist pressure. Even perhaps just inertia. Sometimes even tax considerations. Short selling is also a way in which holders of stock can increase their returns on the stock by renting it to the short sellers. Little risk to them.

In my day, you could short sell, effectively, for fourteen working days. The London Stock Exchange used to work on a fortnightly settlement cycle. So for example a deal you do tomorrow, if tomorrow was a new cycle, would not need to be settled until the Monday in the middle of the next fortnightly cycle. If you went short tomorrow, you could, potentially, buy back for cash settlement (a special, premium service for urgent trades that was settled the next trading day) as late as the Thursday night before settlement day - so giving you fourteen trading days to see the stock fall and buy it back.

Nowadays everything is more or less "cash settlement" with positions settled the next working day - hence the self limiting requirement to borrow stock to deliver on short positions.

No, there's nothing wrong with short selling. Once you realize that the secondary market is stocks and shares is a big gambling den in any case, how can you outlaw one type of gambler and not another.

The real problem, it seems to me, with the run on HBOS shares for example, blamed on "short sellers", is the idea that some market players, hedge funds were cited, were "hunting in packs". Now, it is conceivable that even if there's nothing wrong with the fundamental financial health of a company, such a "pack" could be strong enough to provoke a run on a stock simply by weight of numbers. This, however, would be market manipulation. It would be legal, ethical, and even just plain sensible, to suspend trading in a particular share, or even in the whole market, if there was such illegal manipulation going on, or suspected. If a suspension was unwarranted, there should still be the equivalent of a "stewards inquiry" to determine if there was manipulation, a cartel operating, and if so how to punish them.

If the fundamentals were bad for HBOS, and actually I suspect that they were worse than the financial watchdogs have been saying - otherwise opening their books would have been enough to disprove the rumours - then the short sellers simply administered the coup de grace a bit more humanely perhaps than dragging it out for weeks more uncertainty.

I very much suspect that some hedge funds and private equity fund managers do aggressively hunt in packs occasionally. The fact that the secondary market is a gambling den makes it likely. That needs investigating. Market procedures for suspending trading in a market in which the true value of a company has become impossible to assess immediately need looking at. But having a go at the short sellers, who could, after all, just be the people maintaining liquidity in a particular market, is simply creating a scape-goat. The authorities should be ashamed.