The source of all freedoms?

Anyone who has read more than one post of my blog will realize that I am a passionate supporter of Land Value Tax. In other forums, when the subject comes up, people sometimes feel, and say, that I pursue the issue too zealously. Even those that support some LVT are sometimes embarrassed at the "hard core Georgists" like myself shrilly calling for more. I know plenty who regard the claims from some of us as to the myriad benefits Land Value Tax could bring as just plain rubbish - "nothing could be that good and not have been tried".

None more so than when housing policy is to the fore, as it ought to have been, floods permitting, these past couple of weeks. No sooner was the Housing Green Paper published to great fanfare than it seemed for all the coverage that half our existing housing stock was plunged knee deep in water and all the discussion about housing was about building in flood plains or not rather than the rather more pressing issue of ensuring everyone has a decent place to call their own in the first place.

So, read on if you want to try to understand just why it is that "hard core Georgists" like myself so fundamentally believe that not only is Land Value Tax the only permanent solution to the broken market that is housing, but also why it forms such a core part of any human being's fundamental right to an opportunity to achieve personal freedom and the root of many equity and economic justice issues. I hope you'll understand at least that we are not talking about just a different way of raising tax but a radical shift in how we think about tax itself and more importantly an alternative view of our relationship to the planet's resources and each other.

Land: our common birthright

The headline of Polly Toynbee's article on the green paper from Tuesday 24th July, "Everyone is entitled to a stake in the nation's soil and bricks", showed promise that at least one of the chaterati was going to describe this basic principle. Though she failed convincingly to explain the entitlement the headline proclaimed or how one might achieve such an entitlement the sentiment embodied in that headline gets close to the core rationale for Land Value Taxers.

Every human being ever born is ultimately utterly dependent on the bounty of our common planet's natural resources to survive. Consequently every human being ever born has to have a common entitlement to a share of that bounty if they are ever to achieve self-ownership. If you are always dependent on another for a place to rest your bones, that other has a coercive relationship over you, you are dependent on them for how much of the fruits of your labours you are able to keep.

It's an easy thing to say and in an agrarian, low population, subsistence economy a relatively easy thing to envisage - everyone simply spreads out until they've got enough land each of a quality sufficient to keep themselves alive by their own labours on that land, growing food for subsistence and no more. Indeed, John Locke, proto-liberal to some of us, said that since it was mankind's calling to be steward and master of his planet, you have the right to take as much as you can keep and make good use of with one important proviso - that you always leave as much left over, and of as good quality, to be divvied up amongst everyone else.

But such an economy isn't conducive to human development as a whole. In order the better to put nature's bounty to use for everybody's benefit we specialize, in specializing we come together in markets, communities, cities, and our relationship with land changes, though our dependence on it does not diminish. Johann Heinrich von Thunen described and then David Ricardo explained how human interactions and communities create rental value in land - those locations closer to where more people want to circulate, live, conduct commercial or social activities rise in value simply by virtue of where they are.

In fact, the rental value of a location in land is the financial expression of by how much that location breaches Locke's Proviso mentioned above - that you can take and own as much as you like, so long as you leave enough for everyone else, of as good quality, for everyone else who needs to be in that location to share. Collecting that value and pre-distributing it to all the people that together create that value - via a Land Value Tax (others have described it as the "Community Collection of Rent" perhaps more descriptively) and a Citizen's Dividend - is giving each person the financial value of their birthright to a piece of land.

Now, there are lots of objections to such a scheme, frequently voiced by those who do already own, or by those who don't think this could produce significant amounts of revenue. I shall try and anticipate and respond to some of those objections in following articles. But I hope at least that you get the picture as to why some of us believe LVT is more important than just another taxation method. The sharing of the land value we all collaborate in creating is a fundamental right to an equitable share of our common inheritance in a complex world where it just isn't practical for us to spread out and have an equal share of actual land each.

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