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OpEdNews Op Eds    H1'ed 10/16/20

How to fix the economy, forever

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There is a Money Tree, but it's being guarded by private interests.
There is a Money Tree, but it's being guarded by private interests.
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Sometimes solutions to major problems can be simple. In this case, the solution to economic inequality based on rent seeking - which is the majority of it - is literally beneath our feet, in the value of land, as the political economist and best-selling journalist Henry George recognized in the late 19th century, in his famous book, Progress and Poverty. More on that in a bit. But first...

The Federal Reserve returns all its profits to the government minus a relatively small amount for its own operations. There was even a bill sponsored by then congressman Ron Paul to simply wipe that portion of the national debt off the books that the government owes the Fed, i.e. what the government owes itself: Click Here. That was the sweet old days in 2011 when it was only $1.6t. That amount has now gone up to $4t, and the Fed is now the government's biggest creditor: Click Here:

Do you remember life before the coronavirus epidemic? Like back in September 2019, when the Social Security Trust Fund was the largest creditor to the U.S. government?

The venerable trust fund's long reign as the biggest single lender of money to the U.S. government has come to an end, because Uncle Sam has a new sugar daddy: the U.S. Federal Reserve! Political Calculations provides the analysis for how that has happened:

The U.S. government has gone on a borrowing binge since the global coronavirus pandemic reached the nation's shores and the number of known cases began increasing relentlessly at the end of February 2020, just over two months ago. From 26 February 2020 through 29 April 2020, the U.S. government's total public debt outstanding has increased by $1.427 trillion, from $23.427 trillion to $24.854 trillion.

That's a lot of money to borrow, and for all practical purposes, all of it was loaned to the U.S. government by its new Number One creditor, the U.S. Federal Reserve, to whom the U.S. government now owes more money than it does to its previous largest single creditor, Social Security. According to the Federal Reserve's H.4.1 statistical release for 29 April 2020, the Fed holds $3.945 trillion worth of U.S. Treasury securities, up from $2.465 trillion back on 26 February 2020, shortly before the number of known coronavirus cases in the U.S. began their rapid rise, which triggered the government actions that crashed the economy.

So, basically, we ought to reduce the debt outstanding by $4t, but of course to do that would be to open the door to the fact that the government can, and is, producing money ex nihilo, and the banks, including the compromised Central Bank, and their supporters - and campaign donation recipients - would rather we don't know that.

And the government should immediately spend most of that into the economy as stimulus. A new Output Gap suddenly formed in the U.S. last spring, says the Financial Times, and it is growing: Click Here and see the chart from Guggenheim Investments about halfway down the article.

If you can't see the chart, that will be $3t in 2021, as a result of the economic shutdown (which has also plunged 8 million Americans into poverty). I'm not counting the $2t already allocated in the CARES Act because most of that went nearly uselessly into the asset markets, including into corporations who bought back stock and are now laying off people they promised not to lay off when they received the money. As the FT points out, the slump is not temporary - on the chart it extends past 2023, with no sign of going away. This is why I say that the shutdown is going to be more disastrous than anything the Corona virus will do to the collective health (oh, and America is lately looking not much worse than most of Western Europe, which is seeing a record surge in cases again).

Now, what about Henry George and Georgism, which might seem like a quaint theory from irrelevant times. It is not. According to the Bureau of Economic Analysis, the value of land in just the 48 contiguous states and D.C., in 2015 - 5 full inflated years ago - was:


Estimates suggest that this 1.89 billion acres of land are collectively worth approximately $23 trillion in 2009 (prices as of 2015), with 24% of the land area and $1.8 trillion of the value held by the federal government.

That's more than the current recessionary value of GDP, or roughly equal, once the government owned portion is stripped out. And that's not even including Hawaii and Alaska and numerous territories.

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Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:
http://www.americaisnotbroke.net/

Scott is a former President of Common Ground-NYC (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written dozens of articles for (more...)
 

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16 people are discussing this page, with 77 comments  Post Comment


shad williams

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Where do you account for fed member banks creation of "money" through the fed?

Where do you account for the fantastic financial instruments such as derivatives, CDOs and negative interest rate bonds, "new" tools of the EUB, BOE, following the BOJ lead?

How much global debt is there?

How long will it take for us to take back ownership of the US goverment, and all governments in the US, from those that currently own it/them peacefully? Or is this a distraction without any means of execution?

Does your idea include a debt jubilee?

Submitted on Friday, Oct 16, 2020 at 3:24:39 PM

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Scott Baker

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Reply to shad williams:   New Content

Taking your good points one at a time:

1. Money creation would be split between government - which currently only produces coins debt-free, and bills at the request of the banks - and the private banks, who often withhold credit-money exactly when it is needed most, like now, even though interest rates are at record lows. Banks are reluctant to lend when they can't make much money in interest. Government should simply issue money, and in this case, it can be "raised" by simply wiping out the debt it owes itself, though a sovereign government has always had the power to issue money anytime, in any amount, for any reason. It's even in the Constitution, Art. 1, Sec. 8, Clause 5, which grants Congress the power to "coin Money" with "coin" in this case meaning "to create."

2. I didn't get into it here, but I can see no legitimate reason for derivatives to exist. Redirecting the rent from the commons would prevent a lot of that since there'd be nothing to leverage. Mortgages, for example, would become more like car loans, just loans for houses, not the land under them. Rehypothecation - the practice of using the same collateral twice or more - has to go away too.

The current "buy everything" policies of the ECB, BOE, BOJ and now the Fed, are a desperate attempt to prop up the economy while Congress cannot agree on a stimulus package that the president will actually sign. It's an imperfect alternative, at best, and ultimately a futile one.

3. Global debt is a tricky thing to measure, since it includes things like money the governments owe to their own Central Banks, as well as debt decades out in the future, when assets and income will accumulate too. Sovereign countries have essentially no limit on the money they can create, though as we can see now, getting it accepted internationally becomes an increasing challenge for countries that don't produce much, like the U.S. Hence, the need for a bloated military to keep the dollar as the world's reserve currency. Sovereign money does not have to replace Federal Reserve money, and indeed, the old United States Notes were not usable for foreign debt, just domestic debt. It even says so on every U.S. Note.

4. The coming election is one of the most critical in my lifetime, since it is a test of democracy itself. If Trump and his acolytes manage to sabotage the counts - I expect less of this from the Democrats - then it's hard to see how any peaceful taking back of power for the People can occur. However, we are getting to a point where measures that once seemed desperate are now taken by conservatives and progressives alike. So there is a better chance now of implementing these steps, all of which have historical support, than before.

5. Debt jubilees originated in ancient Israel, from the Bible, and have rarely been practiced since. Some kings did it. Sometimes when they conquered other people, not to give debtors a break, but to break the creditors so they would not be able to afford to challenge them. Short of war, or bankruptcy, it's not allowed much. If it was allowed, something would have to be done to replace all the banks, which go immediately bankrupt. I advocate for public banks, but even they have to be repaid. I am not suggesting getting rid of banks here.

Submitted on Friday, Oct 16, 2020 at 4:35:22 PM

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K V Ramani

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So the government mortgages all the country's land to itself as collateral to issue 22 trillion crisp new paper/digital/imaginary dollars? And once that new funny money is all spent, it can issue more by hocking all the underwater and offshore resources to itself, even more down the road by monetizing all the air and atmospheric gases, and eventually the moon and Mars as they are potential future assets! What a splendid idea :-)

Submitted on Friday, Oct 16, 2020 at 4:21:34 PM

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Jerry Kelley

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Trump can pay for all that, after all, he acts like a trillionaire!

Submitted on Friday, Oct 16, 2020 at 4:38:57 PM

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Scott Baker

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Reply to K V Ramani:   New Content

No, that's not the idea at all. I already excluded government owned land from the calculation. Most land, and by far the most valuable land, is owned by private interests. It is that land where rent should be collected from. I should have made it clearer that this will also mean the elimination of deadweight taxes on income, capital, sales etc. Since these taxes reduce productivity, productivity will increase, creating a win-win-win situation: more income for people, more revenues for government, less speculation and land hoarding.

The government collects the rent, distributes it to pay for its programs, and returns the rest back on as a dividend, like the Alaska Oil Fund, only larger and national.

Submitted on Friday, Oct 16, 2020 at 5:14:51 PM

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Stephen Carle

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Isn't rent already being collected on private property in the form of property taxes? Are you proposing the U.S. impose its own property tax on top of state, county and local property taxes already in place?

Here's my idea: let's re-elect Trump and he can get Mexico to pay off our debt.

Submitted on Friday, Oct 16, 2020 at 5:41:19 PM

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K V Ramani

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That leaves about 90% of privately owned land. How does government get entitled to collect rent on something it doesn't own? Take what people already own and promise them dividends or interest on it, as if they don't know how to maximize their earnings themselves. Like borrowing your watch to tell you the time.

This is about confiscating private property. Communism by another means. Eliminating taxes is so much fairy dust. When a government or central bank assigns itself the right to issue limitless amounts of money on the basis of questionable or non-existent assets, taxes are no longer necessary except as a tool of control. We are there already.

Submitted on Friday, Oct 16, 2020 at 5:47:10 PM

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Scott Baker

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Reply to K V Ramani:   New Content

Georgism would not interfere with private ownership of land, it would only collect the full rental value, or close to it, of the land. It does this because it realizes that the value of the land comes from the aggregate demand of everyone. There is no tax on the home, which is untaxed and yours to improve as you wish.

What happens now if you fail to pay your property taxes? You can lose your home. Nothing new about that.

As you said, the government is issuing money on the basis of questionable assets. That's why it can't be just doing that. Collecting taxes on land is indisputably on something of value: land and location. Land, BTW, under Georgism, includes ALL of nature's resources, so oil, bandwidth, slots in an airport, etc. could all fall under this rubric, though as I've shown, there is enough value in actual land that these other things may not be needed much, though some will, because the full rental value is a lot less than the full value of the land. One of the experts in Land Value Taxation, the late Mason Gaffney, wrote a 100+ page article on all the other things that could be taxed under a Land Value Tax, about 2 dozen of them, and enough to make all other taxes obsolete.

I'm not even advocating anything that radical, but combined with sovereign money creation, LVT could cure most of the current economic problems. That's radical enough.

Submitted on Friday, Oct 16, 2020 at 6:21:12 PM

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K V Ramani

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Does a government have a right to tax citizens at all to begin with? Ancient monarchs claimed a divine right to tax. Dictators claim the right by might. In modern democracies, the right is supposedly derived from the consent of a majority of the governed, which effectively translates as above 50% of eligible voters 'who vote'.

Since few democracies ever record a 100% electoral turnout, the actual consent is given by a far fewer number of eligible voters (about 60-70% globally). Some simple arithmetic will show how flimsy this foundation of democratic consent is.

In 2016, the US population was 323 million, of which 250 million was of voting age (77%). Of these, 139 million (56%) actually voted in the presidential election. Out of these, about 63 million (46%) voted for Trump who went on to form the government. In other words, the consent of a mere 19.5% of Americans was sufficient to give his government the right to tax everyone.

This is not a unique story. In most democracies, the right of the government to tax (along with numerous other rights) comes from the consent of far fewer than 50% of the citizenry. Yet, sweeping tax laws and obligations are enforced upon the citizenry at large as if the right to tax was indeed a divine right with only a token nod by a small minority of the people to acknowledge the modernization of societies. All tax is ultimately collected from the vast majority of people by any government through coercion, hower much we may dislike using the word.

Underlying all taxes is the question: what does a government need the revenue for? What does it spend it on? The US, for instance, spends more than half of it on its military to maintain and expand its empire. Does a majority of the citizens, even voting age citizens, really consent to this? Of course not.

The fact is the so-called Georgist proposal is nothing more than an act of desperation to demonstrate the US is not bankrupt, in spite of being the largest debtor nation in the world and an incredibly reckless gambler with the wealth of its own people. From what I see, it is a fresh license to find some basis to go on a new money printing binge. Calling it a land rent while generously waiving all other existing taxes is just a sleight of hand trickery. A tax by any other name is still a tax. Government profligacy with people's wealth is usurpation by coercion, by a ruling elite using a small minority of citizens to paint a thin veneer of consent over it.

Regardless, it wouldn't surprise me hugely if this, along with other equally Quixotic proposals like the Green New Deal, doesn't actually come into force. America is caught in the throes of a civil war between two conflicting ideologies. One harking back to its origins as a nation of self-made people and free enterprise. The other rushing pell mell into an unknown neo-Marxist collectivist future despite claiming victory over the same ideology when the Soviet Union fell. Makes me wonder who really won that cold war.

Submitted on Saturday, Oct 17, 2020 at 3:02:50 AM

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Scott Baker

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Reply to K V Ramani:   New Content

You're right. We should just give up.

Submitted on Saturday, Oct 17, 2020 at 3:37:59 AM

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K V Ramani

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The message is get rid of the bloat in government expenditure first before searching for creative ways to squeeze the people further. The US government can get upwards of a trillion dollars a year, year after year, for genuine development within the existing tax structure if it abandons empire. Not a cent more of new/novel taxes needs to be raised.

The Chinese government, the Indian government, the Russian government, the European governments and most every other government can similarly divert enormous sums of money from present tax revenue to their people's needs by pledging to a no war goal. If only the US elite wasn't terrified of peace breaking out and gives up its role as meddler-in-chief of the world.

The low hanging fruit on an impossibly tall tree perhaps, but it is the obvious and immediate little pain, much gain solution. A fruit worth a revolution, even a civil war.

Submitted on Saturday, Oct 17, 2020 at 5:30:52 AM

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Stephen Carle

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Reply to K V Ramani:   New Content

Voter suppression and Senate / Electoral College distortion aside, I disagree that consent is not granted by election outcomes, regardless of voter turnout. Not voting is tantamount to abstention, a valid choice that implies consent to the result.

People are also prohibited from murdering one another by governmental coercion (a.k.a. Law Enforcement), to which I presume you don't object.

Submitted on Saturday, Oct 17, 2020 at 4:30:28 PM

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K V Ramani

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The ten commandments prohibit stealing and murdering alike. Should people disown god for contradicting himself?!

Submitted on Sunday, Oct 18, 2020 at 5:03:03 AM

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Stephen Carle

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Reply to K V Ramani:   New Content

uhhh, what? Where's the contradiction in prohibiting stealing and murdering. But never mind.

All I'm sayin is:

Not voting = abstention = consent to outcome

and,

"Governmental coercion" is nothing but a pejorative term for law enforcement.

Submitted on Sunday, Oct 18, 2020 at 11:31:55 PM

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Isn't rent already being collected on private property in the form of property taxes? Are you proposing the U.S. impose its own property tax on top of state, county and local property taxes already in place?

Here's my idea: let's re-elect Trump and he can get Mexico to pay off our debt.

Submitted on Friday, Oct 16, 2020 at 7:16:22 PM

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Scott Baker

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Reply to Stephen Carle:   New Content

Yes, the Land Value Tax would shift the tax to land and off of buildings.

The idea of the U.S. imposing a tax on top of a state tax is actually not new. The original Articles of Confederation, Article 6, was a property tax. The federal government was supposed to receive a portion of the state's collection of property taxes. Of course, buildings were little more than 1-2 story affairs then, so most of the tax was really on location, i.e. land.

The article was dropped in the Constitution because, as Franklin put it, by then most of the ratifiers were very rich land owners and they simply did not want to pay the tax.

Submitted on Friday, Oct 16, 2020 at 8:11:56 PM

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Stephen Carle

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Are non-land assets, such as debt and equity securities, production equipment and intellectual property also taxed, as either income generators or under capital gains?

Submitted on Saturday, Oct 17, 2020 at 4:50:42 PM

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Reply to Stephen Carle:   New Content

Production equipment is physical Capital, so no tax on that.

debt and equity securities benefit from being under-taxed relative to regular income, but if income from wages is untaxed, they lose that advantage. Then more effort would go to actually producing things and operating earnings would replace rigged earnings by buying back stock, for example.

Monopolies, as I indicated in the article, are a different issue, and patents have to be reformed greatly. Economist Dean Baker (no relation) suggests government just buy whatever drugs are developed, and then greatly lower the price, which would ultimately save more money for Medicare or whatever universal health policy replaces that, than it costs to buy the rights to the drug. A little known fact is that whatever government helps to develop, which is most of the drugs on the market, is possible for government to buy out, legally. It chooses not to do so, to please Big Pharma. Buying the rights outright would also encourage more drug development vs. patent squatting too.

Submitted on Saturday, Oct 17, 2020 at 11:01:30 PM

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Stephen Carle

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I would take issue with both of those points, but that's not where I was going.

First, under this system, how do Google, Facebook and J.P. Morgan Chase incur tax liability, assuming they have whittled their land footprint down to bare minimum, as they surely would do?

Second, how do the shareholders of those companies incur tax liability stemming from their ownership stakes?

Trying to understand how non land-centric enterprise is taxed under the proposed system. Or isn't.

Submitted on Sunday, Oct 18, 2020 at 11:13:59 PM

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Scott Baker

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Reply to Stephen Carle:   New Content

Land - under the most expansive definition that was favored by George - includes ALL of nature's resources. He even complained that "cow effluence" was not being properly reclaimed as fertilizer (this was in an age before artificial fertilizer).

So, these companies have or at least use server farms that sit on land and also use energy. Both of those ultimately use nature's resources, which are part of the commons, and those can be taxed to encourage efficient use.

Beyond that, it's arguable - at least as I have in previous articles - that Google, Facebook and other social media giants, sit on some kind of "virtual land" taking up bandwidth and that they ought to pay for that, beyond what they are already paying to pump out electrons. Their usage both encourages and prevents other usage by taking up space while encouraging others to use that space. It's better to have Zoom meetings for the environment, than real ones involving airplanes and other resource using options, but it's still some sort of environmental impact and bandwidth usage.

The banks are a special problem in that they create money ex nihilo (out of nothing) and that needs to be better regulated or even disallowed in some cases. I also favor public banks, which would put existing funds already in city, state etc. coffers back to use for the communities. See my book too: America is Not Broke!

Submitted on Monday, Oct 19, 2020 at 9:42:12 AM

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Stephen Carle

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Reply to Scott Baker:   New Content

Don't think I can sign up for this, Scott. The expansive, vague definition of "Land" seems to invite the same game-able complexity our current system suffers from. Server farms can be anywhere in the world. Unlike land, bandwidth can be split and split again. In general, so much economic activity is uncorrelated with land usage that an attempt to establish a fair, even-handed tax liability commensurate with profitability seems doomed. And the wealth inequality that would ensue from inadequately taxed profits would make today's society look straight up egalitarian.

It's off topic, but I'm not sure what your criticism of banks means. Are you referring to insufficient reserve requirements? The purpose of a banking system (excluding investment banking) is liquidity - vital to a well functioning economy, as you obviously know. Now, I'm no Republican, and I'm not automatically opposed to government involvement in enterprises where markets don't meet society's needs (healthcare and low income housing, e.g.), but I'm not in favor of a government operation to assess and price risk, i.e. run a bank. Markets are good at that. I believe a society is best off if its government sets up rules for private interests to perform that function and collects its rent at the end of the quarter in the form of taxes. More broadly, I believe the relationship between a governmental system, such as democracy, and an economic system, such as capitalism, is well thought of as that between a landlord and tenant in a performance lease agreement. The landlord sets the rules, the tenant operates its enterprise and pays its rent. The better the tenant does, the better the landlord does. The blindspot of many Republicans, imo, is their flawed understanding that capitalism and democracy are co-owners of the building (or even that capitalism owns the majority share) and that, therefore, capitalism has an equal or greater voice in setting the rules. I don't think most of them realize the principle they're arguing is fascism.

continued...

Submitted on Monday, Oct 19, 2020 at 9:45:02 PM

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Stephen Carle

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Reply to Stephen Carle:   New Content

2 of 2

Also, money isn't created from nothing. It's a note, backed by a government. People who believe money is an illusion shouldn't hold any. They should convert any dollars or other currency they come into possession of into an asset they believe has a higher probability of retaining its value than does the issuing government backing up its notes. But for those people to impose their risk assessment on everyone, many of whom judge the risk of an issuing government not backing up its notes as close to non-existent, seems rather absurd. Kinda like imposing religious beliefs.

For a long time I've believed an asset tax in the U.S. would be a smart means of addressing the nemesis of capitalism: wealth inequality. At first glance wealthy people don't like it - for obvious reasons. But on reflection, they realize it works out great for them. First, since wealth only matters in the relative sense, an evenly applied wealth tax doesn't change anyone's relative wealth position and, therefore, their de facto wealth. (Yes, their wealth relative to their overseas peers declines, at least in the short run - long run, maybe not.) Second, they get to be wealthy in a happy, well adjusted society where tummies are full and sleep is under roof. Much more fun than bullet proof glass, security guards and locked gates.

I agree with the title of your book. U.S. debt is around 27 trillion while private wealth is roughly 130 trillion. I would support a constitutional amendment that automatically invokes a progressive wealth tax whenever the federal debt exceeds some upper limit as a percentage of GDP and remains in effect until some lower limit is achieved. The tricky part is valuing non-liquid assets. A painting for instance. But one means to address that would be to make all assets purchasable by anyone at some premium to the declared taxable value. Mad someone bought your favorite Monet? Buy it back.

Submitted on Monday, Oct 19, 2020 at 9:49:43 PM

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Lance Ciepiela

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Yes, if Donald Trump had truly wanted 'to fix the economy' he could have 'shut down the Federal Reserve' and 'started issuing debt-free money' as legal tender - the federal government, of course, never had to borrow money from anyone, not even from the Rothschild Bank of London and the Rothschild Bank of Berlin, and the other family banking dynasties, who own the federal reserve central banking system in the United States. The American People do not own even a single share of stock, or 'have a say so', in the 'issuance' ('permit me to issue and control the money' - Mayer Amschel Rothschild) of their own money - #OurDebt - #NationalizeTheFed.

Submitted on Friday, Oct 16, 2020 at 4:53:59 PM

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Carol Jackson

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There seems to be two kinds of people who own and/or participate in the monetary (financial systems). First are the Royals or Nobles who are the creditors, second are the peasants, Serfs, who are the Debtors. The Royals live exotic, extravagant lives and spend a lot of time and effort to assure that their control is maintained and guaranteed by whatever means, in perpetuity. The debtors are the worker ants who uphold two of the primary pillars of capitalism, those being labor and aquisition of resources, the third being finances which are the exclusive domain of the Royals. So it is, and always has been, and always will be.

Submitted on Friday, Oct 16, 2020 at 5:47:27 PM

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Lance Ciepiela

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Reply to Carol Jackson:   New Content

Yes, it's the 99% under the heel of the 1% - ever more so, ever since Reagan cut the top tax rate from 70% to 28%. Then wealth and income of the United States trickled up to the top 1% and stayed there - perhaps forever more (the "tax code had a big effect on income distribution"). Neither the Democrats nor the Republicans in congress nor the presidents over in the White House, after Reagan, have taken back from the 1% and handed it back over to the 99%, thereby restoring more semblance of wealth and income equality for the 99% of the American People - the 'deep state is alive and doing well' in the halls of congress - a majority of senators (e.g., Sen Chuck Grassley (R-IA) 'in office' 45 plus years) and representatives (e.g., Rep Nancy Pelosi (D-CA) 'in office' 33 plus years) spending their lifetimes on the hill and they aim to keep it that way, except of course, it never was suppose to be that way ("congressional leaders planning their careers and protecting their longevity"). #EndTheFed.

Submitted on Sunday, Oct 18, 2020 at 1:25:42 AM

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John Lawrence Ré

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Scott, I think you've proposed this before and I responded. Don't recall where it went from there, but I'll reiterate here my concern that such a plan would be the death knell for small farmers who are hanging on as it is by thier fingernails. Large agribusinesses will fold the taxes into their CODB and figure out a way to write them off. Not so for thousands of family farms and timber concerns which form a quilt of sane husbandry, agriculture and silviculture across America. Taxcodes are ultimately financed by the oligarchs. If the Georgist scheme was to be written into law, the reason would be because it somehow benefits the ruling class through asset consolidation and elimination of competition. The Georgist concept might work as an idealized concept, but in our dog eat dog reality, taxes are malignancies for ordinary people and struggling entrepreneurs.

Submitted on Friday, Oct 16, 2020 at 6:27:59 PM

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Scott Baker

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Reply to John Lawrence Ré:   New Content

Small farmers would actually come out ahead.

The tax is on the value of the land, not the size. Farms in general are on less valuable land than urban land, but small farms, with their diversified crops and high labor costs, would come out ahead of large monculture farms with low labor costs. Labor would be untaxed (let's assume, for sake of argument, that no one is being paid under the table currently). Sales would be untaxed. Improvements, like a new barn or tractor, would be untaxed.

What is taxed is the full rental value of the land. This depends on location and in the case of farms, fertility and water access etc. A small farmer raising $20,000 worth of crops per acre will do better than a large farmer raising $15,000 per acre. It's as simple as that.

Normally, it takes more labor, maybe more specialized equipment, more time, to raise a rotation of crops or a mix, though that's better for the health of the soil too. But the small farmer under a Georgist system, wouldn't pay tax on any of that. He would not pay taxes on his sales either. That's his to keep, so the $20,000 is his, free and clear, and a clear $5,000 better than the $15,000/acre farmer.

Large, monoculture farms cannot compete because they would have to eschew the huge tractors and low labor inputs. It goes against their whole business model.

Submitted on Friday, Oct 16, 2020 at 7:47:41 PM

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John Lawrence Ré

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Reply to Scott Baker:   New Content

Maybe I'm missing something here, but I am referring to adding a tax per se, any tax - regardless whether it's less than that paid by agribusisness. The small farmers I know cannot afford a single penny more for anything, nevermind a tax. And you're not correct about the value of small farms. In fact it is the opposite, as they are often located near metropolitan areas where industrial farms were never established. Real estate developers are constantly eyeing small farms for development and small farmers are constantly selling off pieces of their road frontage to pay taxes, etc. Bottom line is that if we've learned anything about the marriage of politics and economy in this country, it's that sooner or later big money interests find a way to turn everything to sh*t for everyone but themselves. This proposed scheme would be openning a can of worms that will eat away what's left of our ecological core, and well intended or not, it'll quickly become a road to hell.

Submitted on Friday, Oct 16, 2020 at 9:35:11 PM

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Scott Baker

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Reply to John Lawrence Ré:   New Content

One of the reasons for urban sprawl, which goes out to the suburbs too, is the failure to tax vacant land so it gets developed. Then, developers have to leapfrog over un- and under-used parcels and spread out utilities, roads, and services, all inefficiently, into forest edges (think fires), flood zones, and in general be far less efficient with land use. Bad for people who have to commute long distances, and bad for the environment, etc. Rather than eating away at our ecological core, it saves it by getting people into the cities. The price of land is too high because there is not enough tax on it. There's an acronym among Georgists: ATCOR = All Taxes Come Out of Rent. Increase the rent (aka tax) and the price goes down.

The LVT would encourage highest and best use, within zoning restrictions.

And small farms can be more efficient if labor is untaxed and maybe with universal healthcare too, to offset that cost.

What you're talking about is happening now, because the only available land is farmland. People would live in cities if it was cheaper and better. Cities, despite Covid paranoia, which should be temporary (I have no cure for mass insanity), are where most of the GDP is produced. Somewhere I read that NYC alone produces 10% of the national GDP.

Submitted on Saturday, Oct 17, 2020 at 3:47:19 AM

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Jill Herendeen

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Reply to Scott Baker:   New Content

So, what is the "value" of a person's (primary) home? How is his/her paying taxes for the privilege (apparently!) of having a roof over their head NOT just a way of lowering the tax burden to ppl who have money to burn?

Submitted on Sunday, Oct 18, 2020 at 7:31:47 PM

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Scott Baker

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Reply to Jill Herendeen:   New Content

Some locations are much more valuable than others. People already accept that having a home on Park Avenue should cost a lot more than having one in the middle of NY State. People who live in more valuable locations do and will continue to pay more, but under Georgism, a lot more of that would go to the state instead of the banks, who have become the de facto land owners.

Submitted on Monday, Oct 19, 2020 at 9:44:49 AM

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Nels Wight

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Reply to John Lawrence Ré:   New Content

John Lawrence, you do have a way of saying it clearly.

Submitted on Friday, Oct 16, 2020 at 9:04:38 PM

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Allan Wayne

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I own a fairly small commercial building, which I improved for 30 years (blood, sweat, and tears) and pay a local county property tax for the building, and a tax on the land (total $6K) which is used to pay for local schools, roads, social services, etc. You are proposing that the land tax go to the federal government, because the feds know better than the locals how to spend the money? Does not sound like bottom-up to me.

Submitted on Saturday, Oct 17, 2020 at 5:32:30 AM

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Scott Baker

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Reply to Allan Wayne:   New Content

It's a substitution. You would not be paying other taxes in that case - federal income tax being the biggest one.

Whatever objections you have towards federal spending - and I know I too have a lot of them - would still be there. Only the source of funding changes. The difference being the deadweight tax on your income would go away, replaced by a tax on land, which gains its value not from anything you did - remember, there would be no tax on buildings - but from the demand for the land by everyone else.

The State and Local property tax would be similarly adjusted to tax only land.

In my previous role as president of a Georgist Land Tax reform group for 6 years, we collected 100s of studies where variations of this change have been implemented and shown to work. None are a "pure" implementation, politics being what they are, but it is enough to measure the impact of a shift. Harrisburg's former Mayor Steven Reed, for example, attributes his city's revival to the shift in property taxes from 2:1 land vs. building tax to a 6:1 ratio.

Submitted on Saturday, Oct 17, 2020 at 9:27:12 AM

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Allan Wayne

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Reply to Scott Baker:   New Content

Most of the tax is on the building, which an owner is allowed to write off as a tax deduction, as well as improvements he makes. So if you are only taxing the land, I suppose the tax will be less, and you leave the owner, with no write-offs, for the innovation and work he does, in my case actual physical work: roofing, repairs, sidewalk maintenance, liability, etc.

Have you ever had any experience doing this? Give all the money to the federal government? More bureaucrats and regulation from the top down? No taxes on buildings? Trump should love that.

Submitted on Saturday, Oct 17, 2020 at 6:54:11 PM

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Scott Baker

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Reply to Allan Wayne:   New Content

There's no need for write-offs if there's no tax in the first place, on buildings that is. On land, there would be no write-offs, which Trump would definitely not love.

As far as giving all the money to the government, let's assume for simplicity, that this would be a revenue-neutral shift. That is, that you would pay the same amount of money to the government, just from a different source: land. The benefits are from behavioral changes: more incentive to develop improvements and new buildings, less incentive to hoard and speculate upon land.

All that money from improvements from roofing, repairs etc. is 100% yours to keep.

As Ralph Nader said, "why not tax bads instead of goods?"

Submitted on Saturday, Oct 17, 2020 at 10:51:15 PM

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Allan Wayne

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So how much would you tax 751 5th Ave, New York, a 19.750 sq. ft. lot, with 1 building on it, known as Trump Towers? People already pay property tax on land, the more valuable the land, the higher the tax. You want to take tax money away from Major De Blazio, and every one else, who I guess you think, does not know how to spend local money as well as bureaucrats in Washington, DC. The diversity of local control would be lost to a giant pile of money in Washington, DC. Of course, middle men like Biden would know exactly what to do with it. Local governments have corruption too, but the elected councilmen, etc, are subject to local elections. The Venezuela government, I assume you are modeling this on, collects all taxes, distributes them locally, according to whim, and of course there has been no corruption in their stellar policies.

Submitted on Sunday, Oct 18, 2020 at 1:35:17 AM

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Scott Baker

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Reply to Allan Wayne:   New Content

Too many wrong assumptions to address here.

But the state/local property tax would be shifted onto land and off the building - Trump Tower, for all its faults, does use land fairly efficiently. But the land itself is under-taxed, enabling a windfall in unearned income - that's the technical term - for Trump. OTOH, he is not getting enough credit for the building.

Then, to get rid of the federal income tax, it has to be made up for with an increased tax on land until the current needs are met. Whether those are justified is another matter, though it would be a lot easier to rein the federal government in if it was restricted to collecting tax from just the Single Tax on Land.

Keep in mind that Trump paid $750 in 2017 and 208, according to the NY Times, and it's pretty hard to make the case that he did anything more socially beneficial with that withholding due to allowable losses over those years, and earlier carried forward.

Submitted on Sunday, Oct 18, 2020 at 6:34:47 AM

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John Lawrence Ré

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Reply to Scott Baker:   New Content

"...which gains its value not from anything you did." That's a silly generality, Scott. For example, I have put a tirelss amount of time, money and energy into developing my land into a sustainable forest and organic crop land, and am alwys being hit by realtors with offers. It is now extremely valuable. A tax would be the only thing that could force me to sell. I guarantee that this horrendous government scam George proposed would be rejected by every small farmer, forester and environementalist I know. Especially since it will ultimately just be an added tax, because ending the income tax will be eliminated from the proposal sooner than later. It will be a slight of hand, where the the governmnt entices congress, then repackages it with the income tax intact. That's just reality and you ought to know that.

Submitted on Monday, Oct 19, 2020 at 6:38:06 PM

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Scott Baker

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Reply to John Lawrence Ré:   New Content

Your working the land is "improvement" and would not be taxed. Of course, whether a diverted stream is part of nature or there because you diverted it is a matter of debate, but it ought to be easy to establish what is natural from what is manmade in most cases. Certainly for the most valuable land - which is in urban areas, that is simple, and location is what makes that land valuable, which is uncontroversial.

A tax might force you to sell, which is not much different from the case already. But if the tax was only on the land, you could make improvements, then sell crops produced on that land and keep 100% of the profits, so there is certainly more incentive to work the land than there is now.

I can't play the Everything-will-be-corrupted-so-why-bother? game. That line of thinking gives us the status quo, which is the only thing everyone agrees stinks already.

Submitted on Monday, Oct 19, 2020 at 8:07:01 PM

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John Lawrence Ré

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Reply to Scott Baker:   New Content

Too much busy work to explain why your suggestions are so unrealistic that it's mind boggling. It's exhausting and maddening even to think about them. I can tell you're a real city slicker. So I'll just conclude by responding to this: "I can't play the Everything-will-be-corrupted-so-why-bother? game." To which I say, of course not, Scott. So let's just keep it simple: cut the income tax in half for all those making less than 1M annually, eliminate it for anyone making less than a 100k and reduce the miltary budget by 80%. Done. No need to plant seeds than can be exploited by a thoroughly corrupt military backed regime like ours that is always seeking new sources of tax money from the public to fund their nefarious colonialist projects.

Submitted on Monday, Oct 19, 2020 at 8:56:35 PM

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Scott Baker

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Reply to John Lawrence Ré:   New Content

Well, needless to say, most people would not agree with either of us...

Submitted on Monday, Oct 19, 2020 at 9:17:13 PM

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Jill Herendeen

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Reply to John Lawrence Ré:   New Content

TWENTY thumbs up! No, make that fifty.

Submitted on Tuesday, Oct 20, 2020 at 2:57:27 AM

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Scott Baker

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Reply to Jill Herendeen:   New Content

Well, weakening government would just allow the private elites to run even more wild than they already do, but then again, if you eliminate 80% of the military, probably not, since someone will invade us and just take over anyway. Maybe eliminate 50%, but even then, which parts? Maybe eliminate those foreign bases, but it's Goodbye Europe then, since they've had a free ride with us and NATO providing cover for them for decades.

And so it goes...

I still say you have to get to the core of the problem in land, and in money creation. Otherwise, it's just whack-a-mole endlessly.

Submitted on Tuesday, Oct 20, 2020 at 6:06:21 AM

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Jill Herendeen

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Reply to Scott Baker:   New Content

IMHO, it's capitalism which creates endless whack-a-mole, and tinkering around the edges of that is just so much re-arranging of the deck chairs on the Titanic (with the 1% having the life boats).

As for our military being there to hold off would-be invaders both here & in Western Europe, I think we'd find out differently if the entire military-industrial complex were socialized & the 1% taxed to fund the whole shebang. If you're really worried about your/our safety, you need to be looking into technocracy--start w/ James Corbett.

Submitted on Tuesday, Oct 20, 2020 at 3:53:50 PM

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John Lawrence Ré

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"[S]omeone will just invade us and just take over anyway." You must have just watched Red Dawn after a few bong hits! The Russians aren't coming. . . no one is coming for us, just as no one came for us when the budget was miniscule by comparison. Whom did you have in mind anyway?

Operating with 20% of our present military budget is more than sufficient to protect this nation. Right now we have an operating philosophy in the DoD like that of the NY Yankees. We should be operating the military like the TB Rays. Much of the savings would come from efficiency, eliminating the 1k bases strangling the globe and mothballing or repurposing the ships from the Navy. The only real deterrents are nuclear and technological, and at the moment we are not as sophisticated in that regard as the RF anyway. That's where the defense money should be spent. A traditional military is only useful for invading nations in the developing world.

Submitted on Tuesday, Oct 20, 2020 at 6:12:50 PM

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I agree John, however are we not forgetting how we get there. There are exceptional people and nations but they are not the US citizens or its nation that show any resolve of throwing off their owners much less reclaiming or reorganizing their Treasure, Commons and Inalienable Rights.

A year ago in the midst of the coup in Bolivia, Mayor Patricia Arce was captured, beaten, had paint thrown on her and her hair chopped off, and was paraded through the streets by right wing thugs who wanted to intimidate MAS supporters.

Yesterday, she was elected Senator

Submitted on Wednesday, Oct 21, 2020 at 6:29:30 AM

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John Jonik

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"The"economy does not distinguish between Wall Street's economy and the economic situation of the people. The commonly used word, "the" is vague, seemingly intentionally so....as if to say it's OUR economy or whatnot.

We often hear that Trump is THE Commander in Chief, or even OUR Commander in Chief...whereas a president is only Commander in Chief of most, not even all, of the military. We, the People, are a president's commanders in chief.

Language is important.

Submitted on Saturday, Oct 17, 2020 at 7:13:18 AM

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Blair Gelbond

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Reply to John Jonik:   New Content

John,

When fascism is the name of the game, language, as you say is key. George Orwell wrote about this. However, it is the Fuhrer and his loyalists (and the unelected MIC/cabal) who play the role of Commander in Chief. I propose that even getting Trump out of office will not be a complete solution (see Eisenhower's farewell speech in which he hinted at the real issue). In a sense Trump is merely an expression of what has been happening since the late 1940's.

Submitted on Saturday, Oct 17, 2020 at 7:02:08 PM

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The original Articles of Confederation had a property tax to collect money for the Federal Government:

VIII. All charges of war, and all other expenses that shall be incurred for the common defense or general welfare, and allowed by the United States in Congress assembled, shall be defrayed out of a common treasury, which shall be supplied by the several States in proportion to the value of all land within each State, granted or surveyed for any person, as such land and the buildings and improvements thereon shall be estimated according to such mode as the United States in Congress assembled, shall from time to time direct and appoint. The taxes for paying that proportion shall be laid and levied by the authority and direction of the legislatures of the several States within the time agreed upon by the United States in Congress assembled.

We should have something similar again, but only on land this time, while abolishing the income tax, which is easily gamed too. Unlike income, land is easy to value and is done all the time by real estate agents and assessors, using sophisticated computer databases. Land values cannot be hidden, unlike income and even more so, wealth. It can't be off-shored and it doesn't fluctuate wildly depending on economic or personal conditions.

Submitted on Saturday, Oct 17, 2020 at 9:34:42 AM

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Blair Gelbond

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Consider the possibility that the game is bigger than 99+ % of us have any idea. I offer this for our consideration:

Click Here

Submitted on Saturday, Oct 17, 2020 at 6:54:04 PM

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John Lawrence Ré

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Reply to Blair Gelbond:   New Content

Yes, that's it exactly.

Submitted on Sunday, Oct 18, 2020 at 10:25:59 PM

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John Jonik

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It would be helpful if, routinely,"Wall Street's Economy", or "The People's Economy" were the phrases used instead of vague meaningless "THE Economy"...depending on content of message.

Submitted on Sunday, Oct 18, 2020 at 4:44:45 AM

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Helen Carpenter

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How can the economy be fixed for the better when all the top players want to destroy it? That's their intent - that's the real 'fix':

youtube.com/watch?v=43xrrFW5L3Q

Submitted on Sunday, Oct 18, 2020 at 10:40:45 AM

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Reply to Helen Carpenter:   New Content

You're talking about "power." I was only taking about "methods."

Submitted on Sunday, Oct 18, 2020 at 3:03:56 PM

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Helen Carpenter

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Methods only work when the boot is taken off our face.....this has to happen first.

Submitted on Sunday, Oct 18, 2020 at 5:20:39 PM

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Reply to Helen Carpenter:   New Content

It's not clear to me that people - collectively - would even know what to do in that case. Without a coherent plan, there is nothing to fight for, and the 1% will always fill that vacuum.

Submitted on Monday, Oct 19, 2020 at 9:47:07 AM

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Good point. But everything is becoming more tyrannical. Today at one of our favorite restaurants, we were told to keep our masks on until the first course arrived. Then at one point, the waitress came around and asked for our phone number - new protocol she said.

On leaving, my husband mentioned the govenor of California tweeted about wearing the mask between bites and she then said that actually they're instructed to tell patrons to re-put their masks in between courses. Where does that leave sipping on wine and water???!!

Our favorite cafe had a sign posted that it was closed temporarily for having been contact traced. Curfews in large urban areas now - 9pm to 6am. That leaves restaurants without evening service. And with up to 70% false positives and contact tracing now in effect, there goes the last surviving restaurants.

The whole thing is criminal.

Submitted on Monday, Oct 19, 2020 at 2:55:07 PM

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Reply to Helen Carpenter:   New Content

Agreed. There are a whole host of reasons why restaurants are not the contagion factories they are proclaimed to be. With reasonable separation, they are not nearly as bad as crowded bars with everyone close and yelling at each other over the noise (I used to hate those kinds of tight gatherings and often caught colds even before Covid).

Yesterday, my wife and another couple and I went to a well-established restaurant in the Times Square area. It's huge top floor could have held 100 people easily and we were the only ones there. There were a dozen or so customers outside, but in winter that won't be true. We too had to give contact tracing and lean over to be temperature checked. You'll be happy to know we all had temperatures in the high 80s! Hmm, not too reliable, those gun-temperature takers... At least we didn't have to stay masked until we left our tables (for whom??).

Without tourists and Broadway showgoers, the restaurant is doomed, and so are half of NYC restaurants.

Submitted on Monday, Oct 19, 2020 at 7:29:29 PM

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Jill Herendeen

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IMHO, Henry George needs to hold a public debate w/ Prof. Richard D. Wolff (too bad the former is no longer able to do that). Income tax is the ONLY US tax with even a hint of progressivity; and because everyone has to live somewhere, whether or not they have any income, and therefore taxing ppl on their basic dwellingplace, including the land it stands on, is wildly regressive. I would suggest that most landlords get to (buy property and) CHARGE RENT because most ppl can't afford to buy enough land with which to feed, clothe, & shelter themselves & their families, and that the solution is to TAX THE INCOMES OF THE LANDLORDS. I further believe that, in fact, the way to fix our economy is to TAX THE RICH, and to legally demand the kind of support for ordinary people & society described in the UN's UDHR. I further believe that all gov't malfeasance is being done specifically for the benefit of the top 2% . Was Mr. George a landlord, by any chance? What were his views on Marx, I wonder?

Submitted on Sunday, Oct 18, 2020 at 2:30:21 PM

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Scott Baker

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Reply to Jill Herendeen:   New Content

Ironically, Georgists, after George died in 1897, were among the strongest supporters of the early income tax in 1913. The early tax fell only on 6% of earners, and most of them earned money through some sort of rent collection on land. Later, the income tax morphed into a more general wage tax, with the original targets finding all kinds of loopholes to avoid paying. So now the top 1%, like RE Developer Trump, actually pay much less tax than the ordinary people who work for them. Warren Buffet famously said his secretary has a higher tax rate then he does.

Land taxes cannot be escaped that way. Land can't be hidden. It can be independently valued, easily and usually without much controversy (buildings are harder to value, but they would be untaxed anyway).

Henry George was a Journalist turned Political Economist turned politician. He came in second in his first NYC Mayoral run, also beating out a young Teddy Roosevelt, and many people think he was "counted out" by a corrupt Tammany Hall. He enjoyed massive support among the working class, though this was somewhat diffused by his later support for Free Trade; the world was not, and is not, ready for that yet. He died with 8 weeks to go in his second Mayoral contest prematurely at age 58 (too many cigars and too much stress).

Landlords and more importantly these days, banks, get to buy land because it is so expensive. It is so expensive because it is under-taxed and what would be tax becomes rent instead (ATCOR=All Taxes Come Out of Rent). George's great insight - which is hammered home in his 700-page book, Progress and Poverty, and in different ways in his next 7 books, is that the value of land belongs to all of us, because of our collective demand for it, while the fruits of our labor - e.g. improvements upon land - ought to be ours to keep. He observed that as cities become richer and more complex, people often became poorer, and concluded that this is because they do not all have equal access to land. Land is the first and ultimate monopoly and the concept of rent-seeking derives from Landlording.

Submitted on Sunday, Oct 18, 2020 at 3:16:49 PM

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Jill Herendeen

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Reply to Scott Baker:   New Content

YES, Income tax "morphed" into something only millionaires had to pay into something which everyone BUT millionaires now has to pay. Did that just passively "happen", or did a non-transparent, non-elected IRS MAKE it happen?

Submitted on Sunday, Oct 18, 2020 at 7:14:39 PM

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Neither. Those same millionaires made it happen.

Submitted on Monday, Oct 19, 2020 at 9:47:55 AM

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Jill Herendeen

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...probably because They run the IRS, is my guess. Why not--they run all the other "regulatory" agencies.

Submitted on Monday, Oct 19, 2020 at 4:03:43 PM

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Reply to Jill Herendeen:   New Content

It's not necessary for them to be so directly involved. They can just hire (read: bribe) the appropriate politicians to structure the laws to suit them. They have very good lawyers and lobbyists for that.

Submitted on Monday, Oct 19, 2020 at 6:00:49 PM

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Yes, yes; a distinction w/out a difference. Especially since IRS officials are probably getting salaries well over Fed. min. wage.

Submitted on Monday, Oct 19, 2020 at 6:37:55 PM

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What about the FACT that Congress COULD just create all the currency we need debt-free, instead of farming out the job to private banksters for their own fun-and-profit, so that there would be zero need to tax anybody/anything in the first place?

Submitted on Sunday, Oct 18, 2020 at 2:42:55 PM

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Reply to Jill Herendeen:   New Content

Yes, that was my first solution in the article, which George also wrote about and supported. He said money creation was too important to leave to the banks. I wrote about it in a peer-reviewed economics paper here.

We still need the Land Value Tax though, to prevent unearned income from monopoly in land, unjust inequality (that is, not based on merit), and to control asset inflation. Otherwise, politicians will continue to distribute money to their supporters, much as they do now, only with debt attached to it, debt which is almost meaningless, since it is never repaid.

Submitted on Sunday, Oct 18, 2020 at 3:21:45 PM

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IF a few (rich) ppl have bought so much land that they have a monopoly in it, how is that NOT because their other assets have been taxed so lightly that they still have lots of money to invest in land?

Submitted on Sunday, Oct 18, 2020 at 7:34:55 PM

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Surely ending the WAR ON DRUGS would be a huge step in the right direction, seeing that the economy has been running mostly (if not entirely) on the laundering of illegal monies: dillonreadandco.com

Submitted on Monday, Oct 19, 2020 at 1:09:26 AM

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They have been able to hide their assets, or even claim losses (hello, Donald Trump) so that they effectively pay little or no taxes for decades. Using land as the basis for taxation would eliminate most of those loopholes.

Submitted on Monday, Oct 19, 2020 at 9:49:26 AM

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WOULD taxing the land owned by the rich be more transparent/enforceable than taxing the incomes of the rich, though? Does George explain that process in detail? Sure, the LAND can't be hidden, but its ownership can be, through shell companies, at least...

Would the POOR be exempt from land taxes? or at least from having to pay taxes on enough land for a house, barn, & a few acres for their own subsistence? If NOT, how would that not be wildly regressive? Does George explain that? It sounds like he never set foot outside of NYC. Maybe his suggestions were for NYC alone, and maybe they would work there--but there's a lot of land that's not in NYC. Where I currently reside, in upstate NY, the property taxes are outrageous, & the price of land keeps going up, way above what anyone working that land for themselves would be able to support themselves from. And still there's lots & lots of vacant land, just growing back to woods. I bet it's just being bought up by money-launderers, with whom it's really, really tough to (legally) compete.

Submitted on Monday, Oct 19, 2020 at 4:23:09 PM

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Georgists, post-George, thought about this problem: someone being cash-poor but land rich. It's sometimes called The Poor Widow's Problem (sexist as that is). Basically, the solution is forbearance: allowing the "Poor Widow" to retain her property without paying the tax, but passing the back taxes onto whomever ultimately buys the property, or inherits it if she dies. One of the most famous Georgists, the late Mason Gaffney, said this would weed out the truly needy from those who are crying crocodile tears.

The upstate lack of land value appreciation is actually a feature, not a bug. It shows that the property tax - imperfect as it is, because is is on houses, not just land - is mostly working. That is, if a land parcel is properly taxed, there would be very little appreciation, or at least the tax would be adjusted upwards to get the appreciation. Without that, there is the sort of rampant land speculation that caused the GFC of 2008-09. The banks certainly had a lot to do with that, but at the base, that was them speculating on land appreciation. The harm from that to the real economy can't be overstated, but it includes millions of people ultimately losing their homes and many bankruptcies, proving that short-term gains do not lead to long-term prosperity, except for the very few 1% who are positioned to gobble up failed mortgages and homes loans.

Submitted on Monday, Oct 19, 2020 at 5:59:24 PM

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Jill Herendeen

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Reply to Scott Baker:   New Content

...so the Poor Widow's heirs will get screwed by having to pay the back taxes? Which in turn will inflate the asking price, so that only the rich will be able to afford the property?

But upstate land prices which are on LAND, NOT houses. Indeed, a LOT of (mostly older) homes are for sale on tiny lots, which were obviously carved out of bigger farms. (It doesn't help when most of the towns up here won't allow you to raise so much as a hen unless you have a minimum of five acres.) Meanwhile (& I haven't checked on this recently so I don't know if it's still true, but it was 10 years or so ago), a farmer can't deduct property taxes as a cost of doing business from NYS income taxes UNLESS he grosses(or is it nets?) $10,000 min. in farm sales. How is that not small farmers subsidizing big farmers?

And, surely, the "rampant land speculation" of 2008 was just pure theft via mortgage fraud, which the gov't simply ALLOWED (by failing to prosecute).

What am I missing here? EVERYTHING I've read here about George & Georgists sounds to me like the 1% &Wall St. investors get to benefit, period. The rich do NOT benefit from poor ppl being able to leave their tenements and go off and grow their own grub. It's pretty clear which group George was pandering to in his run for mayor of NYC....

Submitted on Monday, Oct 19, 2020 at 6:31:23 PM

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Scott Baker

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Reply to Jill Herendeen:   New Content

It will actually DEFLATE the asking price. People won't pay a high purchase price when they are paying a lot of back taxes. The market for land is inelastic, to use an Economist term. The supply is fixed and the demand doesn't vary much and is constant.

The farmer won't have to anything on sales, just for land values. So, no deductions for anyone because no taxes on sales. Everyone would pay the same amount for equally valuable land - or, more or less, for, more or less, valuable land.

There would be no mortgage fraud if not for the incentive to make a killing on land appreciation. By untaxing buildings, and only taxing land close to its full rental value, mortgages would become like car loans, just loans on the car, not the road underneath, which belongs to everyone. 70% of banks' loans are for "homes" (really, half or so for the land), so when the land portion is removed, the amount banks could lend upon will be reduced and the banks will be too, which is why they hate George.

Submitted on Monday, Oct 19, 2020 at 7:36:59 PM

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Blair Gelbond

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Reply to Scott Baker:   New Content

Scott,

If you wish, see:

"Global Financial Fraud, Global Hope The world financial system is one gargantuan Ponzi scheme..."

on globalresearch.ca.

Submitted on Monday, Oct 19, 2020 at 10:26:12 PM

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Michael Dewey

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"When shall it be said in any country of the world, my poor are happy; neither ignorance nor distress is to be found among them; my jails are empty of prisoners, my streets of beggars; the aged are not in want, the taxes are not oppressive...when these things can be said, then may that country boast of its constitution and government."~ Thomas Paine"
       -- Tom Paine

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Probably good ideas from what can understand with my economics IBEW talk of coins are round to go around.

Too me, its looking like Oil and Gas needs to be Nationalized as Public Utilities, with profits invest in in good green jobs of solar, wind and Hemp for the paper, plastics, textiles and bio-fuel we can produce from it. With of course the Greens Union styled-part worker ownership modeled after the $20 Billion a year worker owned & run Mondragon Cooperative of Basque in Spain which owns its own Collage that trains its workers, who each have a vote in how company is run. With of course the Public Utilities run through Public City and or State Banks as North Dakota has been doing since 1919.-Post Office perfect spot for them.

Submitted on Monday, Oct 19, 2020 at 10:44:01 PM

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