Wealth and Want
... because democracy alone is not enough to produce widely shared prosperity.
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What we don't measure, we can't manage. What we don't measure properly, we can't make rational judgments about. The Consumer Price Index, believe it or not, does not take into account the huge appreciation of land when it calculates the cost of living. Instead, it uses a measurement related to the imputed rental value of a typical home.

The cost of living for those who don't yet own a house is high, and rising. The human misery this creates is avoidable.

Herbert J. G. Bab:  Property Tax -- Cause of Unemployment

The steep increase in the level of rentals represents a true and accurate yardstick of our housing shortage. During the period 1950 to 1961
  • the average rental rose from $71.13 per month to $186.79 or by 160%.
  • During the same period median urban family income rose from $3,497 to $5,924 or by only 69%. 
  • Construction costs per square foot rose from $8.68 in 1950 to $11.32 in 1961 or by only 30.4%.
The ever widening gap between the level of rentals and the urban family income constitutes a rental squeeze, which has brought untold misery and hardship to families in the lower income group, especially to those belonging to minority groups. The rental squeeze has also aggravated overcrowding and slum conditions.

In the press, on the radio and on television we are often warned about the threat of inflation. Hardly ever are we told, that the increase in the cost of living is to a large extent due to the increase in housing costs brought about by the housing shortage. The inflationary effects of property taxation are reinforced by the fact that property taxes themselves are included in the cost of living index and that property tax rates have the tendency to rise. Read the whole article

Weld Carter: A Clarion Call to Sanity, to Honesty, to Justice  (1982)
... So how is it that on so richly endowed a Garden of Eden as this world of ours we have only been able to make of it a hell on earth for vast numbers of people?

The answers are simple: we have permitted, nay we have even more than that, encouraged, the gross misallocation of resources and a viciously wicked distribution of wealth, and we choose to be governed by those whom we, in our ignorance, have elected. As the principal focus of this paper is on inflation, let us give this process its full name which is fiat money inflation and let us define this as the process by which a government continues the issuance of irredeemable paper money until the quantity so issued finally renders it worthless.

Since the founding of our country, there have only been two first-class countries guilty of this process. The first of these occurred in France in the late 1700's; the second was in Germany in 1923. In both, the results were devastating, and not limited to the offending parties: World War II, for example, resulting directly from the German inflation of 1923, and the rise to power of the madman Hitler. When one recalls the horrors of both of these, one should be dumbfounded at the insanity currently rampant throughout every single so-called first class country in the world today.

The effects of inflation could be accounted for in the words of Edwin Kemmerer, who introduced his first lecture on the German inflation of the early 1920's with the statement that, whereas money must not be confused with wealth, it does serve three extremely important functions: as a measure of wealth, as a medium for the exchange of wealth, and as a storehouse of wealth. This was at the start of a series of six lectures presented in the mid 1930's (for $5.00) at the New School for Social Research in New York. The disaster of inflation might best be described by a contemplation of the destruction of this storehouse. Money in the bank today has a specific worth; a year from now, it may be worth significantly less.

A great American economist in the field of money and banking, a past president of the American Economics Association, Kemmerer taught primarily at Princeton University. He emphasized the fact that everyone in German suffered terribly, although mentioning the fact that the landowners suffered the least. Before it ended in 1923, over 475 quintillion marks had been printed, and people were taking wheelbarrows of them to market.

We tend to think that the awful inflations that affected Germany and France in the past century couldn't happen here, that "they" wouldn't let it. However, under the current paradigm of economics, "they" have no control. Politicians in power praise the skills and the impact of the efforts of proponents first of fiscal and then of monetarist policies, as if these two approaches constituted the only two available solutions.

They don't know any answer. We're on a roller coaster which we cannot stop and from which we cannot escape. The inevitability of the terrible future that apparently lies ahead is so awesome that people tend to bury their heads in the sand, taking the attitude that they might as well enjoy the present because the future is so far out of their control. Economists generally have not provided much reason to do otherwise, and no one, including the general run of economists, has come up with any hope of salvation, of rescue.

Suffice it to say that history has shown inflation to produce an outcome that an intelligently run economy should avoid at virtually any cost. The ultimate outcome of the inflationary course we are now pursuing is the repudiation of the current money system. ... read the whole essay

Jeff Smith: Share Rent, Transform Society

Now the public is paying for private parties. That is not fair. Look at the economy. Take taxes off homes, and they become more affordable. Have some kind of land charge, and housing stock increases as sites get developed. Affordable housing helps stabilize neighborhoods. In places that do have the land tax, i.e., Australia and New Zealand, they have fewer disputes with assessment. Assessors say their job is so much easier now. If land is less profitable and less of a political football, it is less tense in local politics. 

  • If you take taxes off labor and capital, more investment flows into jobs, and we would have close to full employment, so labor could demand full market value for services. We could double the income of the average worker with no loss in standard of living. 
  • If fewer demands are placed on government by citizens, it doesn't have to borrow so much.
  • If you reduce the amount of tax on the economy, and reduce the amount of redeemable notes, then we should be able to eliminate inflation. It is unmasked. You can see lower prices; the cost of living goes down. It will change social relationships.
  • Labor and capital make up, with higher wages for labor, lower taxes for capital, and more investment funds.
  • Labor can negotiate from a position of strength.
  • Capital might want to share management decisions and spread that risk of liability to workers. It tends to reduce hierarchy and increase equality in society. 

What other social relations might change? Increase land ownership participation in community and it benefits community, with town hall meetings and block parties. Those kinds of communities have less crime. Pittsburgh has six times greater land tax than improvements, more affordable housing, and less crime.

The main indicator of economic health is called the GDP. A good measure would be leisure, the amount of time off from labor to maintain a comfortable standard of living. If we shift, it would shrink the work week, and help get rid of rush hour traffic.  ... read the whole article


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Wealth and Want
... because democracy alone hasn't yet led to a society in which all can prosper