Wealth and Want
... because democracy alone is not enough to produce widely shared prosperity.
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Service Businesses

As population increases and technology advances, finer and finer division of labor becomes possible, and a wider range of services and goods are created by specialists. Instead of individuals being "jacks of all trades" they tend to be masters of one, and buy the services and goods they need from others. Ideally, each has the capital they need to provide those goods and services efficiently, and a location where they are accessible to those who would be their customers.

Many kinds of businesses rely on a location close to the center of business activity. Lacking that location, the numbers don't work. But many of our best locations are underused, and the only option for the entrepreneur is a place closer to the fringes. At such a location, one can't draw on customers or potential employees from a 360° radius.


Jeff Smith and Kris Nelson: Giving Life to the Property Tax Shift (PTS)

John Muir is right. "Tug on any one thing and find it connected to everything else in the universe." Tug on the property tax and find it connected to urban slums, farmland loss, political favoritism, and unearned equity with disrupted neighborhood tenure. Echoing Thoreau, the more familiar reforms have failed to address this many-headed hydra at its root. To think that the root could be chopped by a mere shift in the property tax base -- from buildings to land -- must seem like the epitome of unfounded faith. Yet the evidence shows that state and local tax activists do have a powerful, if subtle, tool at their disposal. The "stick" spurring efficient use of land is a higher tax rate upon land, up to even the site's full annual value. The "carrot" rewarding efficient use of land is a lower or zero tax rate upon improvements. ...

An obvious loser is a resource extractor such as an Oregon timber harvester (Weyerhauser is the biggest landowner in the state). All the rent that society now allows them to retain, they'd lose. Perhaps there is a silver lining to corporate mergers and diversification and interlocking stock holding; the huge corporations holding resources would have other profitable lines to turn to.

An obvious winner, balancing the losses of the extractor, are the service-providing companies located off the beaten path, like a neighborhood cafe. After centuries of just getting by, smaller enterprises would gain by competing on a level playing field. What they'd gain (that is, retain) is the fruit of their labor. Conversely, what big business would lose is the commonwealth generated by all. ...

Two other groups who have yet to fly the PTS banner but who stand to gain substantially are small businesses and service businesses (often the same). For a small business (this writer used to work in his father's), taxes are a double levy -- the tax owed and the fee for the accountant. Big companies have an easier time absorbing the costs of recording, verifying, and paying taxes. The simplification of taxation inherent in the PTS could appeal to small business people.

The other potentially supportive businesses -- service providers -- do not consume much in the way of resources or prime locations. Even service providers on valuable sites, were they to pay more, could still come out ahead in the better business climate of zero taxes on sales, on paid wages, on customers' income, and of less onerous mortgage. Presently taxes and mortgages consume about 65% of the average worker's income, drastically reducing discretionary spending. ...

A big problem needs a big solution which in turn needs a matching shift of our prevailing paradigm. Geonomics -- advocating that we share the social value of sites and natural resources and untax earnings -- does just that. 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