Hello Fellow Economic Reformers!
sponsored by Common Ground-NYC. This was a great opportunity to hear the current state of the crisis, the history of it, and what to do about it, from some of the great progressive and/or Georgist thinkers in our area.
I've written an article about it here:
Conversing with the Lefties at the Left Forum: Panel With speakers Andy Mazzone, Dr. Michael Hudson, and Dave Kelley
and for an upcoming issue of GroundSwell. The video link will be posted to the Left Forum site in a few weeks here:
Have you joined Common Ground yet? You should, and support outreach efforts like this:
http://commonground-usa.net/whyj.htm. ; You don't even have to pay the full $36/year:
GroundSwell subscription only ($15)
Sample issue of GroundSwell (free)
Read Michael Hudson's recent article describing how government can create its own currency:
I had a chance to ask Florida Congressional Candidate and former Florida Congressman, Alan Greyson, on a conference call, about his support of the idea of Greenbacking and specifically the NEED Act, and he said he thought the idea of moving the money-making power away from the banks was worth looking into, but he had some disagreements with some specifics in the Kucinch bill. Dennis Kucinich was unfortunately defeated in the recent Ohio primaries - a victim of Republican-led re-districting due to the loss of population in Ohio, and a contest against partial incumbent, Marci Kaptur
or, if you are a member of The Yahoo Economic Reform group:
The authors call for the establishment of a parallel system of debt-free money (like this author), modeled loosely on the Lincoln example of Greenbacks, but much more in keeping with the electronic age.
In addition, the authors say (pg. 13-14, emphasis added):
These pressures are combining with other economic, social and environmental arguments to support a tax shift -- shifting the burden of taxes off enterprise and employment and on to the use of resources, including land, energy and the capacity of the environment to absorb pollution. There is also the demand of international bodies like the OECD and the EU for action to reduce the attractions of tax havens. A more effective way of reducing them, rather than trying to enforce internationally harmonised regulations for the collection of existing taxes, might be by a tax shift which will reduce existing levels of tax on incomes, profits and capital.
Apart from the option to use some of the new seigniorage revenue to replace existing taxes, one further point should be noted. Supporters of land value taxation, i.e. taxing the site value of land, claim similar advantages for it as are claimed for monetary reform (on which see Chapter 4): it will help to smooth out the peaks and troughs of economic cycles, make it possible to reduce distortionary taxes that now damage the economy, distribute more fairly the value of resources that should be shared in common, and open up opportunities for enterprise and work to people now excluded from them.
Unfortunately, instead of co-operating with one another to promote these complementary reforms, there has been a tendency among some supporters of land value taxation and monetary reform to dispute which of the two is the more important. Further study of possible links and interactions between the two might encourage a coalition of support for both. This could usefully be initiated by a body such as the New Economics Foundation.
I do disagree with the authors' recommendation to use a private Central Bank for the issuance of debt-free money (i.e. U.S. Notes here in America, but they are British and talk about the U.K., the Eurozone, and Japan as well). They say they do this to prevent political bodies - such as our Congress - from over-issuing money and creating inflation, but given the rightward tilt of Congress, I think the danger is their releasing too little money to help meet the productive capacity of the nation (which this author believes is how money quantity should be ultimately determined, whether money is issued privately or publicly). The authors' claim that the U.S. Constitution, article 1 section 8, would need modification to issue debt-free money, which is simply not true (e.g. we issue, unchallenged, debt-free coins) - would therefore be moot.
Finally, here is a heavily footnoted academic paper (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1489439) supporting Lincoln's Greenbacking, also practiced by FDR's ($3 Billion), pre-Georgist Landbank currency before the revolution in Pennsylvania, and a nod to the State Banking model of North Dakota. The authors supply some nuanced information on Lincoln's, and then secretary of Treasury, Salmon Chase's, decision to produce debt-free sovereign money, accounting for up to 40% of Civil War funding. Chase would later contradict himself as Supreme Court justice in Hepburn v. Griswold (1870), essentially declaring he had acted unconstitutionally in his previous capacity as Secretary of Treasury, but this would be overturned in two subsequent Supreme Court decisions, Knox v. Lee (1871), and Julliard v. Greenman (1884), paving the way for the federal government to produce United States Notes under Article 1, Section 8's, constitutional authority to "coin Money."
Several subsequent attempts, post-Roosevelt were made to issue new United States Notes. One of the most recent was proposed in 1999 by Representative Ray LaHood (like Lincoln, a Republican from Illinois), who introduced legislation to create $360 billion in United States Notes to be lent interest-free to state and local governments over a five-year period to fund capital projects.
Time for a plug, folks. Many people on this list will have already seen Prosper Australia's new video but, if you've not already done so, why not let your friends know about it too? It's now freely available at http://realestate4ransom.com/ .
State Banks are the Norm, not the Exception
It's easy to get discouraged about progress towards our goals. For example, America still has only one State Bank - the Bank of north Dakota - in spite of the BND's wildly successful track record: no bank failures in the state for 10 years, the lowest unemployment and foreclosure rate in the nation, both under 4%. However, as this recent article (click here) from Public Banking Institute president Ellen Brown - part of what she will present at the upcoming PBI conference in Philadelphia, April 26-28 - makes clear, it is State Banks that are the norm the world over, not private banks. Why? Because countries that have them are more stable, grow faster, have fewer booms and busts, less corruption, less egregious banker salaries, and higher returns to the governments of the countries they are in (the BND has returned over half a billion dollars to North Dakota since WWII). They do the traditional job of banking , not speculation in bubble markets for short-term gain. It's not that hard. No wonder the BND is run by Occupy Wall Street's favorite Banker (click here).
I met with my local Assembly member, Brian Kavanagh, along with Public Banking advocate and Georgist Common Ground Treasurer, Rita Rowan, recently. He is fully on-board with both of these ideas (indeed, he did his post-graduate thesis on Henry George and is well aware of the benefits of LVT). However, New York's Governor Cuomo does not believe in setting up commissions, according to my source at Sandy Galef's office, sponsor of the feasibility study bill (http://www.assembly.state.ny.us/leg/?default_fld=&bn=A06737&term=2011&Summary=Y&Actions=Y&Votes=Y&Memo=Y&Text=Y). But, as Kavanagh put it, "well, in that case, why not just skip that and set up a State Bank instead?"
Why not indeed! We heartily agreed with that!
Hopefully, we can move in that direction soon, but no one in that meeting was under any illusions that the country's largest banks, nearly all headquartered in New York, will move from "studying" the Galef bill to endorsing an actual State Bank. The people will have to demand it (click here)! I did get a chance to plead to the audience for pressure on Galef's office to pass a real State Banking bill, at the Left Forum's Public Banking Panel (click here). Are the Occupy people, and others, strong enough to coalesce around the idea of a State Bank? There's some evidence from the 2nd article above that they just might be.
From the shoot-myself-in-the-foot Department:
Here is a short example of industry-favorable misdirection, from a growing movement to abolish all property taxes in North Dakota - and feed an already booming Land speculation boom:
Fortunately, people are fighting back:
but the oil & gas industry is very powerful there, and they may get their way.
This is a radical move - if ND does this, it will be the first state in the country to abolish property taxes, and then even a State Bank won't save them form the inevitable Land boom and bust. We only need to look at California's post proposition-13 to see how that turned out.
2. Excellence in mathematics.
3. Being very knowledgeable about one particular field.
4. Ability to make connections with prominent professors.
5. Being interested in, and being good at, empirical research.
6. Having a broad knowledge of the economics literature.
7. Having a thorough knowledge of the economy.
This does not mean the study of economics is hopeless (or else this writer might as well stop learning too!), but it does mean we'd better be real careful whom we listen to and why. One economist who did get things right, Steve Keen, was voted the most accurate by a poll of mostly other economists, here: http://rwer.wordpress.com/2010/05/13/keen-roubini-and-baker-win-revere-award-for-economics-2/, says:
This is bizarre, since as long as 4 decades ago, the actual situation was put very simply by the then Senior Vice President, Federal Reserve Bank of New York, Alan Holmes. Holmes explained why the then faddish Monetarist policy of controlling inflation by controlling the growth of Base Money had failed, saying that it suffered from "a naive assumption" that:
"The empirical fact that "loans create deposits" means that the change in the level of private debt is matched by a change in the level of money, which boosts aggregate demand. The level of private debt therefore cannot be ignored--and the fact that neoclassical economists did ignore it (and, with the likes of Greenspan running the Fed, actively promoted its growth) is why this is no "garden variety" downturn. "
Keen also warns of the Ponzi FIRE sector that has now created one of the greatest asset bubbles in history.
Online Course & Training Program
Those with full course access, which is the majority, receive individual responses to their course assignments, recorded on the website. We keep in touch with the entire student body via occasional emails.
The course includes:
Five Modules: Land Rights and Poverty, Land Prices and the Law of Rent, Land Value Capture, Economics of War and Peace, and Policy Implementation. Below you will find a brief description of the contents of each of these modules.
Several hundred quotes organized into several categories including Economists, Philosophers, Statesmen, Land Ethic, Ancient Wisdom.
A Land Value Capture Calculator which can illustrate the taxable capacity of land for a particular city or locality.
A Forum section with categories including Thematic, Classes and Geographic.
Below you will find more details about the several components of the Land Rights and Land Value Capture program. The course is offered as a public service. Scholarships are available upon request as stated on the online course enrollment form.
The course is here: http://www.course.earthrights.net/
Module Two - Land Prices and the Law of Rent - introduces the "law of land rent" - an in-depth analysis of the role of land under economic development as land values increase.
These first two modules will give course participants a heightened understanding of how many social problems are rooted in "the land problem." By the end of the second module students will know how the enormous worldwide wealth divide is due in large part to fundamental injustice in the "people/planet" relationship.
Module Three - Land Value Capture - introduces "land value capture" as a key public revenue policy based on justice in land rights. Sections in this module describe how this approach to public finance can "hatch many birds out of one egg" by addressing a number of issues including provisioning affordable housing for all, funding infrastructure, helping to secure women's rights, promoting land reform, and improving the environment.
Module Four - Economics of War and Peace - details the dynamics of how - absent equitable rights to land resources - a war system develops and how land value capture can be an important tool for resolution of conflicts over land and natural resources.
Module Five - Policy Implementation - first gives ideas about ways to mobilize citizen campaigns in support of this policy followed by specific details of policy implementation. Course participants will learn about components of a land value capture system, principles of land valuation, and the use of information technology to promote understanding and transparency in policy implementation.
Enroll in Land Rights and Land Value Capture here: http://www.course.earthrights.net
The firm, Covington & Burling, is one of Washington's biggest white shoe law firms. Law professors and other federal ethics experts said that federal conflict of interest rules required Holder and Breuer to recuse themselves from any Justice Department decisions relating to law firm clients they personally had done work for.