Tuesday, October 5, 2010

More Jobs per Acre

If we want to solve the problems of unemployment, under-employment, and poverty, we need to look at two different components of material wealth. One component of wealth is God- and/or Nature- given, such as land, clean water, clean air, and radio spectrum. These are things which no human creates. Another component of wealth is work or what humans do with a share of nature to produce the things we need for life, starting with food, clothing, and shelter. Every material thing outside of ourselves is a product of these two components.
How do we create an environment the allows a working person person to earn sufficient income in order to acquire those things we need in order to live in a dignified way? We must look at these two components and and ask what our public policy must be, especially our tax policy.

If we want to maximize the opportunities to work we must not tax work, or the creation of work. This means that sales taxes, goods and services tax, Value Added Tax, and wage taxes are barriers to a person exchanging his or her work for the work of another person. Such taxes mean that a person must labor more hours to meet their needs.

We must also be sure that the God-given natural resources are not hoarded or titled in such a way that land-ownership is a way to wealth without work. We must not allow this vestige of slavery to be the pathway to riches for the few and poverty for the many in this world.

The way to do this is by a tax shift, starting with lowering the part of property tax on buildings and increasing the part on land. This has been done in many jurisdiction on the US, especially in Pennsylvania, in Australia, with the result that the number of empty and underused lots is greatly reduced. It reduces the burden of working and of providing work. It reduces the bait to speculate on land which means that home and farm buyers do not need to bid against land speculation. This tax shift results in More Jobs Per Acre. Who doesn't want more jobs per acre?

For more information, check out: http://wealthandwant.com/ or http://progress.org/

Monday, May 10, 2010

How will I get there?

How will I get there?
How will it be?
Will it be one wheel?
Or will it be three?

One wheel is unstable,
I'll probably fall;
Three wheels is too wide,
I'll never get there at all!

I know how I'll get there!
I know what I'll do!
The right number of wheels, for one person,
is two!

Sunday, May 9, 2010

Downstream or Upstream

When we confront the multitude of problems that our country and our world face: Pollution, Unemployment, Homelessness and Lack of Affordable Housing, and Environmental Disasters, for instance, there are two ways of trying to solve them: I call them Downstream and Upstream.

For instance, do we solve the problem of polluted rivers by trying to rid the rivers of pollutants after they get in the river by trying to cleanse the river downstream after it's polluted? or do we control the pollution of the river upstream by limiting the use of pollutants near that river? It would seem much more sensible to limit to control pollution before it gets to the river.

In the same way, we can tackle unemployment, or a least some of its results, by providing unemployment benefits after a person is unemployed. The would be trying to solve the problem downstream. Or we could change the tax system so that a person is not penalized with increased taxes when they work, or provide work. This would be an upstream solution.

With homelessness and lack a affordable housing, we can set up a means test, that is, an income or asset criterion, which would decide if a person would be eligible to receive a subsidy for housing, which would be collected from other people who do not meet this criterion. Those who are just on the other side of this criterion would have to contribute to this subsidy through taxes or other government mandates, either direct or indirect. A downstream solution. Or we could change our tax system so that it increases effective wages and lowers the land portion cost of housing. That would be an upstream solution.

The recent oil spill suggests that this could have been prevented by more controls over those who produce oil (upstream solution). The questions arise:
  1. Who would appoint the watchers? Probably, whichever government is in office at the moment.
  2. Would those who appoint the watchers be influenced by those who profit from lack of control? You can answer that one.
The alternative would be to reduce the demand for oil by eliminating the subsidies on driving, such as socialized parking (provided by the local governments, and mandated by local governments on those who want to provide jobs or housing. Also eliminating the exemption that motor vehicles and motor fuel have from paying sales tax here in North Carolina, and I presume in other states. Also, zoning which mandates that a certain size lot or house is the only one allowed in certain areas could be struck down. (Upstream solutions)

For all the aforementioned issues the solution of Land Value Taxation needs to be examined, especially in its long-term effects. References are available on this blog.

Friday, April 2, 2010

What happens when you go for a job interview?

What goes on when you interview for a job? I think the first thing the interviewer has in mind is: "What can this person do for our company?" They size you up and guess that you can contribute a value to the company that they convert to dollars per hour. Then, assuming that they calculate a positive value, they have to figure out what it will cost them to hire you. Some of the costs will be the furniture you need, the share of the building you will need, and the share of the land that building occupies that you will need, and the additional taxes they will need to pay if you are hired. All of these things can be calculated in term of dollars per hour. They then have to figure: this person is worth, say, $20 per hour to our company; it will cost about $1 per hour for furniture, $3 per hour for building and tool rent and $3 an hour for land rent (including parking) and $3 an hour in extra taxes our company will pay. So that means that the most I can offer this person is ($20 - $1 -$3 - $3 -$3) or $10 per hour, and not lose money on them. See the graphs here and here. Now, what if, the government collected the land rent as tax, rather than taxing work activities. That would mean that the employer would pay the land rent and the tax concurrently. (kind of like serving a two jail sentences concurrently) This is possible because the person who is now collecting land rent is not producing anything, he is just a title-holder, an idle noble. So if the government takes over this function, it can not only give you back more of the benefit of your work, but will reduce the burden on this person who is thinking about hiring you. In that case the employer can offer you $20 - $1 -$3 - $3 or $13 per hour.

Often the person or organization which owns that land is also the one that owns the building and the tools, but the effect is the same as if it were two people: as building owner he is receiving compensation for something he has provided or has traded his labor with someone for, but as land owner he is getting something for producing nothing, since land is a gift of Nature/God/Higher Power, not the result of any human effort.

If you think that the fact that land value is close to building value seems inaccurate, I took the numbers from the relative value of an office building in Cameron Village in Raleigh: the building is valued at $1.7 million, the land at $1.5.

What you produce belongs to you; what no human produces belongs to everyone.

The graph can be downloaded as Powerpoint or Open Office (Simpress) so you can slide the Tax and Land-rent parts together. Open Office is free, available here.

Monday, March 8, 2010

Integrated, Neighborhood Schools; possible?

I just realized that one of my favorite authors, Jane Jacobs, in her book, "The Death and Birth of Great American Cities", stated that the one of the biggest obstacles to affordable, integrated, housing and integrated cities is the combination of zoning laws and neighborhood covenants. I would add to this Socialized Parking supported by Parking Requirements.

For a start, check out:

You can also see comments on her book at:

Sunday, March 7, 2010

Integrated Schools or Neighborhood Schools?

There has been a great deal of discussion in our county on whether the Wake County should abandon the program that buses children from their neighborhoods to schools in other neighborhoods in order to maintain balance of children from more well-to-do families and those from less well-to-do families.

I believe that it is possible to work for Integrated Neighborhood schools. That would imply that we have neighborhoods that are integrated economically. So the question is: what is it that keeps neighborhoods segregated economically? One of the factors is zoning and neighborhood covenants. Many of these mandate that only certain lot sizes or certain house sizes and that houses and business be built with parking privileges attached to them.

Things that need to be discussed are:
What is the purpose of zoning?
Why is it necessary?
Who is in favor of it?
Does it shut out the working poor from living in much of the city/county?
Does it, in effect, segregate?