From the BBC:
The United Nations has adopted global guidelines for rich countries buying land in developing nations.
The voluntary rules call on governments to protect the rights of indigenous peoples who use the land. It is estimated that 200m hectares, an area eight times the size of Britain, has been bought or leased over the past decade, much of it in Africa and Asia.
Etc etc blah blah blah. This whole problem can be easily fixed by introducing Land Value Tax. It wouldn't matter if there has been a corrupt deal (or indeed even a perfectly above board and legal deal. On a moral level, they are all corrupt - you can't sell what you don't own) in the past, a people/government which is minded to obtain justice for itself can just reclaim the [economic value] of that land by taxing it.
And once LVT has been introduced, there is no incentive to "grab land". If wicked Western corporations come along wanting to use the land because they can use it more efficiently than indigenous people, then the indigenous people will be happy for them to do so, because they will be compensated in full.
Solving the "land grab" issue using LVT, rather than just laying down guidelines and trying to prevent evil capitalists from using the land, has the added bonus of annoying the do-gooders who think that indigenous people like being indigenous. Do they heck! They want medicine and fridges and cars and televisions just like the rest of us.
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Which leads me on to another topic. The USA is one of the rabid land grabbers of all, it seems to have military bases in or on about half the countries of the world. No individual country has the nerve/strength to stand up to the USA, but what if we all did it simultaneously?
What if the UK, Panama, Puerto Rica, Cuba, Germany, Diego Garcia, Greenland, Japan, Iraq, Saudi Arabia etc etc all got together and told the Americans to clear off?
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29 comments:
That was my thought too.
I reckon they would say "OK then, f*** the lot of you" and withdraw.
This is actually quite a popular policy in the USA, where a lot of people would rather just stop bothering about the rest of the world.
They'd leave. It's not the soviet union. Militarily it costs a fortune to subsidise other countries defence and the military welfare state undermines local military development too.
They left Iceland without too much fuss, as far as I can remember it was decided and done with within a few months.
I am sure that many US citizens, looking at their deficit, are asking the same question. However, from a geo-political standpoint, is it still safe not to rely on the US deterrent effect, given what is happening in Russia, Iran etc. Let's ignore the UN, as usual. Actually, why not defund the UN?
And once LVT has been introduced, there is no incentive to "grab land". If wicked Western corporations come along wanting to use the land because they can use it more efficiently than indigenous people, then the indigenous people will be happy for them to do so, because they will be compensated in full.
That assumes a relatively non-corrupt country that either uses the revenue in services our transfers, a lot to be desired for most of the subjects of strategic land purchases. I think any third world country introducing LVT would reduce potential buyers, The main reason for these purchases is hedging against future ag-land scarcity -> higher rents, and buying them wouldn't be that interesting any more. What is happening now is that the inept, short-sighted and corrupt governments of most of the global south is happy to take the offer of any little amount of speculative value in land not properly registered and usually used by someone already.
and it's fine as long as Russia will pay LVT when it re-annexes Estonia, Latvia, Lithuania, Ukraine etc.
Yet another problem for which LVT is the cure, it's amazing that something so beneficial hasn't been adopted throughout the world. Next week, no doubt, it will be the cure for the common cold and within a year we can expect cancer to have been obliterated entirely.
If I didn't know better TFB, I'd say you were suffering a bout of Sour Grapes....
Lo, a land problem solved by a land-based tax. Now that's out of the box thinking! Who would have ever thought it, eh?
As an American, I can assure you that more and more of us are starting to look at the amount of our tax dollars spent on the military and wondering whether that much is truly needed. Must the US spend more on its military then the next 20 countries combined? Of course, much of this spending is to protect our interests in the Persian Gulf so we Americans can driving our massive gas guzzling SUVs!
Kj: "That assumes a relatively non-corrupt country that either uses the revenue in services or transfers"
Yes. But I assume that only a relatively non-corrupt country would replace all taxes with LVT in the first place.
TFB: "Yet another problem for which LVT is the cure, it's amazing that something so beneficial hasn't been adopted throughout the world."
Can we stick to the topic? Third World despots quite like selling off land and mining rights and putting the proceeds in their own pockets. This is far more difficult to do if LVT is in place.
"Next week, no doubt, it will be the cure for the common cold and within a year we can expect cancer to have been obliterated entirely."
You've advanced some fairly ludicrous KLN's in the past, this one takes the biscuit. No LVTer ever claimed this, but the Homeys are forever pointing it out.
Mark, there isn't anyone in Diego Garcia who isn't from the US, AFAIK. All the indigenes were moved off to make way for the Yanks. If Kj is right, we wouldn't need to get together, we could do it piecemeal. OTOH, have you ever watched "A Very British Coup"?
B: it was the americans themselves who decided to jump ship on iceland, so I guess it depends on their judgement on strategic importance.
I like the Americans. Mind you by looking at the average size of them, I couldn't eat a whole one...
"Buy land, they've stopped making it"
But at some time in the near future people will be setting up seasteds of dloating islands and within decades mankind will be building O'Neill Settlements - spinning settlements in space maybe 10 miles long and 5 miles in diameter. In a century they will be being churned out like automobiles. All the technology currently exists it just has to be scaled up.
Neil, That may well be true but it will have little or no effect on the need for LVT. I could spend another few thousand words explaining why but it's not my blog, so I'll leave that for Mark next time he's looking for a new KLN to do. I'll just leave you with the thought that Ricardo's Law of Rent also applies to the scenario where new land is created rather than just travelled to and in either scenario there is a cost involved.
The problem in Africa is lack of secure land tenure. Without this, farmers will not invest in their holdings because a government strong man and/or his favoured foreigner can come and turn him out. With that sort of government it is difficult to see any tax on land or anything else being honestly collected.
The problem is going to come bursting to the fore in South Africa shortly where the President was recently filmed at a party rally, singing "Machine gun the Boers" to an ecstatic response. Whether the government grabs the land for its supporters or leases it to foreign companies to grow food supplies for their own home countries, we can expect more harrowing pictures of big-eyed, starving children.
NC, I refer you to D's comment.
ES: "The problem in Africa is lack of secure land tenure."
Agreed. And what sort of government collect more LVT? The one that gives stability and continuity etc. Even a despot can give stability and continuity - as I've said before, rental values were higher under Ian Smith than under Robert Mugabe.
Derek,
WRT new location creation and the tax on this, I've come to the conclusion that the state could in effect purchase the new location off the creator (say ship owner) in return for LVT discounts.
In effect LVT vouchers become the currency for the state! Modifying the volume of LVT credits by the change in LVT reciepts would follow Ricardos law of rent in that currency volume would expand with the economy without inflation.
We don't need the Gold standard, we need the Land-Standard!
Yes, the state could purchase the new location, SB. No doubt about it. But even if it didn't, the megacorp which owned/built the seastead or space colony would be the defacto state for it. And would, I have no doubt, charge rent (which is basically LVT by another name) to anyone wanting to live on their property. The big difference from a state would be that the megacorp would be under no obligation to recirculate the rent/LVT as a Citizens Dividend. Although an enlightened one might.
Personally I would not want to live in such a place unless the megacorp was majority-owned by its tenants/residents. The possibilities for major abuse of the tenants when it isn't should be obvious to any Georgist.
On your idea of money backed by land instead of gold, I'm in favour. Germany's hyperinflation in the 1920s was cured almost overnight when it switched to the Rentenmark which was basically a land-backed currency.
Having said that I believe that a properly-managed fiat currency with no backing other than "you must pay your fines and taxes with this" will work just fine. The big problem of course is ensuring that it's "properly managed". Politicians have proved time and again that they can't be trusted in the long run.
The ability to 'create land'/build floating platforms isn't any different when it comes to LVT. Those platforms still have to be *somewhere*, and that 'where', and what's around it, still matters greatly. The only difference for seasteading is that there is no current government. That state of affairs won't last very long.
SB, D, F, agreed. Sea steading is a complete red herring and is in no way a solution to private collection of land rents, and to the extent it is a solution, it is a very expensive and hence pointless one.
Spot on, fraggle. This is particularly true for the O'Neill colonies which need to be located at specific orbital locations (the Lagrangian points).
If it ever becomes technologically "cheap" to make these 10-mile-long habitats, the Lagrangian points, of which there are a relatively limited number, are going to become valuable for exactly the same Ricardian reasons as any other piece of desirable real estate in short supply.
D, funny you should mention gravity. I like to see the way in which large towns form as the end result between centrifugal and centripetal forces.
Centrifugal = more and more people, so higher and higher wages (more 'space' in an economic sense), pulls more people in.
Centripetal = more and more people, so more and more crowded (less 'space' in a purely physical sense), pushes people away.
The two forces always find an equilibrium, and the way that land values increase towards 'the centre' is a bit like the fact that air temperature is highest at ground level (you can't get air below ground level).
And why are large objects like stars (or towns) where they are? They started off as two atoms (people), which attracted a third and then a fourth and so on.
Yes, Mark, the centrifugal/centripetal thing is fascinating. I'd love to see an economic model that incorporates it.
Mark, I think you've got centrifugal and centripetal the wrong way round: centrifugal means "fleeing the centre", centripetal "seeking the centre".
D, we don't need a model, we've got real life.
B, damn and bugger, yes, I got them the wrong way round.
Personally I would not want to live in such a place unless the megacorp was majority-owned by its tenants/residents. The possibilities for major abuse of the tenants when it isn't should be obvious to any Georgist.
That's why I think things like seasteads and orbital stations will be a minor alternative for a very long time into the future. People will probably move to these places if there is something to gain and/or they have the money, temporarily. But in general, for all it's faults, a state, on the ground, with acceptable protection of person or self, as opposed to a place where you will be under some corporate rules, potentially being chucked off if you are dire straits, still has some advantages in terms of freedom and prosperity.
Kj, agreed. Better the devil you know.
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