Monday, April 14, 2014

Conservatives for Georgism and a Social Market Economy

Conservatives for Georgism and a Social Market Economy:
On Attracting Conservatives and Libertarians to the Philosophy of Henry George

Addressed to the West Coast tax reform organization Common Ground OR-WA
Written April 10th-15th, 2014



   Introduction

   Classical liberals, conservatives, libertarians of the left and right, and students of Austrian and Chicago School economics in the State of Oregon could be convinced of amending the Oregon State Constitution to allow communities to experiment with increasing property taxes by over 3% per year (while decreasing the tax rate on improvements to land and keeping taxes on land itself steady), by being shown arguments in favor of other things Georgists support which have been made by classical liberals, conservatives, libertarians of the left and right, and students of Austrian and Chicago School economics.
  Such individuals include classical liberals Adam Smith, Thomas Paine, and Thomas Jefferson; Austrian School economist Friedrich Hayek; Libertarian Party presidential nominee Gary Johnson; conservative columnists Jonah Goldberg of the National Review, Charles Murray of the American Enterprise Institute, and Dan Mitchell of the Cato Institute; libertarian columnists Matthew Feeney and professor Matt Zwolinski; former Reagan advisers Bruce Bartlett, Art Laffer, and Milton Friedman (and his son David D. Friedman); economist Ed Dolan, Alberto Mingardi of EconLog, Don Arthur of Club Troppo, classical liberal Josh McCabe, and libertarian Guinevere Liberty Nell.

   Arguments favorable to the Georgist view include arguments supporting proposals for a (flat) negative income tax; statements made by the nation's ideological founders criticizing unlimited taxation and landed property; and proposals for a Universal or Unconditional Basic Income / Basic Income Guarantee / Guaranteed Minimum Income, and/or Citizens' Income / Citizens' Dividend / Sovereign Wealth Fund.
   Matthew Feeney of the libertarian magazine Reason wrote favorably of the Swiss proposal for a social dividend. Feeney wrote, “Instead of treating those who, often through no fault of their own, have fallen on hard times, like children who are incapable of making the rights choices about the food they eat or the drugs they may or may not choose to take, why not just give them cash?”


   Classical Liberals

   But America's history of classical liberal support of limited taxation and limited private property in land dates back to before Henry George was even born; back to the very foundings and foundations of the United States and modern Western theory of political economy. President Thomas Jefferson said, “Wherever, in any country, there are idle lands and unemployed poor, it is clear that the laws of property have been so far extended as to violate natural right.” Economist Adam Smith said, “As soon as land becomes private property, the landlord demands a share of almost all the produce.”
   Thomas Paine said, “Men did not make the earth. It is the value of the improvement only, and not the earth itself, that is individual property. Every proprietor owes to the community, a ground rent for the land which he holds.” In his 1797 pamphlet “Agrarian Justice”, Paine advocated financing a social insurance system for people of all ages, financed by a 10 percent tax on inherited property. In today's terms, Paine's proposal would give some unspecified amount to each individual each year before the age of 21, $17,500 annually to each individual at the age of 21, and $11,800 annually to everyone over 50.

   David D. Friedman and Matt Zwolinski have expressed agreement with Thomas Paine's idea that each individual living today suffers from past injustices relating to the inequities of the property rights system. In December 2013, former Reagan adviser Bruce Bartlett wrote that, for Friedman and Zwolinski, a universal income might be an appropriate reparations payment, giving a grant to young people in “compensation for the loss of their natural inheritance in land”, which was “seized by the state and given or sold to particular individuals for their exclusive [private] use.”
   Professor Matt Zwolinski, writing for Bleeding Heart Libertarians, commented on the “quasi-Nozickian” argument “that a BIG [Basic Income Guarantee] could serve as a mind of rough-and-ready compensation for past injustice”. Zwolinski wrote that “David Friedman and David Henderson both took issue with this argument … [b]ut … The federal government was directly responsible and/or culpably complicit in the commission of a long series of gross injustices, and many currently existing Americans continue to suffer the effects of those injustices. The government owes those who were harmed by its wrongdoing some form of redress, and I think there are plausible grounds for using a BIG to make that redress.”


   Friedrich Hayek

   In his book “Law, Legislation and Liberty”, economist Friedrich A. Hayek endorsed a minimum income, writing that “The assurance of a certain minimum income for everyone, or a sort of floor below which nobody need fall even when he is unable to provide for himself, appears not only to be a wholly legitimate protection against a risk common to all, but a necessary part of the Great Society in which the individual no longer has specific claims on the members of the particular small group into which he was born.”
   Matt Zwolinski wrote that “Don Arthur has a[n] … essay casting doubt on whether Hayek actually supported a basic income at all … Arthur claims that Hayek's minimum income was conditional in two ways: first, it was a means-tested policy intended only for people who lack the financial resources to support themselves, and second, it was conditional on a willingness to work.” However, Arthur notes that Hayek quoted approvingly a passage which read in part “no man, whatever be his vices or even his crimes, shall die of hunger or cold … because the gift of mere subsistence may be subjected to conditions which no one will voluntarily accept”.
   On the other hand, Hayek has called securing “an adequate and uniform minimum standard for all human beings everywhere” “impossible”, and has argued that the Great Society dream of guaranteed minimum income for all goes against the classical liberal notion of the purpose of government [but of course the statements of Smith, Paine, and Jefferson might show that idea to be faulty]. Hayek also wrote that “[i]t is unfortunate that the endeavor to secure a uniform minimum for all who cannot provide for themselves has become connected with the wholly different aims of securing a 'just' distribution of incomes”.
   Kevin Vallier explores Hayek's views more deeply in a May 2012 article for Bleeding Heart Libertarians entitled “F.A. Hayek: Enemy of Social Justice and Friend of Universal Basic Income?”


   Richard Nixon

   In an August 1969 proposal called the family assistance plan, which had been developed by Daniel Patrick Moynihan, President Richard Nixon revived the negative income tax, which had been recommended by a commission appointed by President Lyndon Johnson. Unfortunately, Nixon favored enacting the negative income tax on top of the existing welfare system, rather than in order to replace it as Milton Friedman desired, which resulted in Friedman abandoning the plan as altered by the Nixon administration.
   The family assistance plan proposal was opposed by liberals and conservatives alike in the Senate Finance Committee in April 1970. The plan was killed by liberals because “they didn't believe it was liberal enough”, according to Bruce Bartlett, even though it was originally Democrat Sargent Shriver who originally suggested the proposal to President Johnson. Bartlett wrote that Moynihan was forced to admit the plan's failure in 1978.


   Milton Friedman

   Milton Friedman, later an advisor for President Ronald Reagan, said “[i]n my opinion, the least bad tax is the property tax on the unimproved value of land, the Henry George argument of many, many years ago”.
   In Friedman's 1962 book “Capitalism and Freedom”, he advanced an argument for a “negative income tax”. Bruce Bartlett wrote in “Rethinking the Idea of a Basic Income for All” that in Friedman's proposal, “if the standard deduction and personal exemption exceeded one's gross income, one would receive a subsidy equal to what would have been paid if one had comparable positive taxable income.” In 1968, Milton Friedman appeared on PBS's “Firing Line with William F. Buckley” to defend the negative income tax against Buckley's concerns about non-working poor taking advantage of guaranteed income.
   According to Bruce Bartlett, Friedman's view was that “the concept of progressivity ought to work in both directions”, and that the negative income tax should be “based in the existing tax code”. Former New Mexico Governor and 2012 Libertarian Party presidential nominee Gary Johnson gas spoken in favor of the negative income tax. Johnson has also spoken in favor of a national value-added general sales tax, arguing that it is not regressive.


   Art Laffer

   Art Laffer, yet another former economics advisor for President Reagan, said that “all taxes are bad”. He became well-known for the Laffer curve; for observing that taxes on an action tend to discourage the very action which is being taxed, and that earning and keeping money are effectively discouraged by taxes on income and earnings. It would benefit Georgists to make the concession that Laffer was right, acknowledge that “all taxes are bad”, and concede this point to conservatives, libertarians, etc..
   However, it might also help to explain to conservatives that there is a difference between a tax as a taking of wealth versus a so-called tax as a collection of urban land rent, which is not earned wealth resulting from human labor, but an intangible value which is, to a large degree, created and protected by government. [Thanks to Chicago Single Tax proponent Adam Jon Monroe for this point.]


   Charles Murray

   Libertarian conservative social science scholar Charles Murray of the American Enterprise Institute wrote in favor of a universal grant of $10,000 per year; both as a complete replacement for the existing welfare system, including Medicare and Social Security. Murray wrote a book called “In Our Hands”, proposing having the federal government give $10,000 to every non-incarcerated adult over 21. Murray was buiding on work done by Milton Friedman and Friedrich Hayek. Jonah Goldberg, writing about Charles Murray's proposal, wrote in “Escaping the Rat's Maze of the Welfare State” that “[o]n n the left, the idea has been popular for generations as a way to instantaneously alleviate poverty and to defeat … income inequality.”
   Goldberg continued, “The libertarians want to liquidate much of the welfare state and convert it into cash payments. The left's version is that the money would, for the most part, augment the welfare state.” Goldberg noted two obvious potential libertarian objections to the UBI / GMI: 1) “cost”, and 2) the “competence assumption” problem (the lack of belief that 'the intended beneficiaries of government anti-poverty programs always “behave rationally enough to advance their own self-interest.'”). Additionally, Goldberg wrote that “some anti-poverty programs create incentives that make bad decisions seem rational … [b]ut many poor people have just had rotten luck. There's good reason to believe that, with a little help, they can work their way up the economic ladder.”


   Conclusions About Taxation

   Georgists seeking to convert conservatives to supporting Sovereign Wealth Funds and Citizens' Income or Citizens' Dividend would do well to argue that transitioning to a system of taxing land only (and not the improvements to it, which include income and earnings; trade, consumption, and sales; and savings, which is taxed through inflation and excessive Quantitative Easing) would involve gradually decreasing taxes on individual income. [This is in regards to Oregon only, which has eliminated the general sales tax, but whose state and local government are based more on individual income than any other state in the country, as of 2007. Most states have not have abolished the general sales tax.].
   Georgists seeking to convince libertarians, conservatives, classical liberals, and capitalists in Oregon that amending the Oregon State Constitution to allow for communities to experiment with increasing property taxes by over 3% per year (while decreasing the tax rate on improvements to land and keeping taxes on land itself steady) would benefit taxpayers in rural areas, should emphasize conservatives', libertarians', and classical liberals' support for income guarantees.
   These income guarantees should be promoted based on the fact that the State - being by its very nature monopolistic, coercive, territorial institution which always abuses its tremendous purchasing power - owes everyone some compensation; specifically for losing their right to equal inheritance of land as a means for potential socioeconomic equality through the production and trade which they perform on that land (or at least they would, if such behavior were only taxed less, or not at all).

   Georgists might have success converting the aforementioned types of ideologues by advocating for the implementation of a negative income tax in concert with a Universal Basic Income or Guaranteed Minimum Income, creating revenue pools for Sovereign Wealth Funds and Citizens' Dividend / Citizens' Income programs, from which to draw funds for the disbursement of the difference between the income of a person living below the poverty level and the standard minimum deduction (or 50% of that figure, as Milton Friedman proposed), thereby giving people no net incentive to stay on welfare if and when they find opportunities to become capable to work their way off welfare.
   Georgists should explain to conservatives that the Single Tax would provide for a tax on the extraction of natural resources, as Alaska has done with the Alaska Permanent Fund (which has been running for 50 years, and which has survived numerous Republican administrations). The negative income tax could be used for the same purpose as the Single Tax (during the transition away from taxing income in general); that is, creating a pool of general funds for use by any and all individuals in the general public (whether by everyone, or by everyone who requests such funds).
   A combination sovereign wealth fund / community land trust based on prevention of clear-cutting in Oregon's logging industry might be a way to create these funds, and perhaps even to secure state protection of what are now federal lands.
   I would urge Common Ground OR-WA to explain to rural Republicans in Oregon that changing the State Constitution to abolish limits on tax increases on total land value to allow property taxes to increase by more than 3% per year (while decreasing the tax rate on improvements to land and keeping taxes on land itself steady) by additionally explaining that the intent of lifting this cap is to raise taxes on land in order to de-necessitate individual income taxes and replace the entire welfare state with an efficient, viable, trustworthy voucher system (and perhaps also an online social credit network). This proposal would certainly be palatable to rural Republicans in the state, whom are known to demand the abolition of one tax as a concession for introducing a new tax or augmenting an existing tax.
   If Common Ground OR-WA does not favor the negative income tax, then I would urge the organization to support raising overall revenues from land taxation in order to approximate its effects, and then to eventually eliminate the general income tax. I believe that this should be done while retaining whatever existing corporate income taxes, capital gains taxes, and gift and estate taxes are on the books in the state. I would recommend that this be done as a temporary experiment, which will hopefully help demonstrate that taxing land more than income is generally beneficial to the effective progressivity and fiscal solvency of the tax structure.

   But eventually, all of those taxes should be eliminated - in a gradual, across-the-board manner - rather than allowing various factions to bicker about which of these taxes (in addition to luxury taxes, licensing fees, and interest, the tax on saving money) should be lowered, and when, and which first, and which in which order, and whether to even eliminate them at all.
   Corporate income taxes, capital gains taxes, and the estate and gift taxes should not be targeted as the first tax to cut for the same reason that states which eliminate the general sales tax often retain luxury taxes / sales taxes on expensive items. This is because the conservative proponents of corporate income, capital gains, estate, and gift taxes argue that these taxes are “duplicative”, being that they are taxes on income which has already been earned and taxed. How “duplicative” would these taxes be if general income outside of these taxes were not taxed at all (at least in the first stage of eliminating income taxes altogether)?
   However, declining to unyieldingly advocate for the eventual abolition of taxes on luxury items, gifts, estates, corporate income, and capital gains could risk ignoring several important possibilities. The first is that strategic collective purchasing may help make luxury items available to large quantities of people (thus rendering them not exactly luxury items.
   The second possibility is that taxing gifts and estates at too high a rate could make it financially difficult for parents to share with dependent children, and ensure that they have a place to live, without the State or some collective or company getting involved. The third possibility is that taxing corporate income could negatively affect cooperative corporations and corporations in which unions have been awarded large quantities of shares and control.


   More Recommendations and Suggestions

   It is important to understand the conservative and libertarian mindsets: the State, centralized government, and monopolies all tend to concentrate political and economic power towards themselves and intervene in the market, picking winners and losers, and sometimes even enacting price controls.
   Conservatives and libertarians believe that corporations - but also importantly other enterprises, business associations, trust funds, non-profit charities, religious organizations, and other non-governmental organizations - should be considered when government needs to save resources by outsourcing responsibilities to outside of the public sector, rather than public-private partnerships.
   They believe that these types of organizations should be given the opportunity to serve their purposes, and not hindered from doing so by bureaucracy, replacing the government's role in providing services for free and goods at affordable prices, and providing goods and services to people more directly and efficiently than public agencies like state and federal departments (which are customarily run by elected officials, and by appointed officials who are appointed by elected officials).

   I would urge Georgists in general – and the members of Common Ground OR-WA in particular - to accept that this kind of thinking is valid, rather than worthy of antipathy, ridicule, or fear. After all, cooperative corporations are corporations too, and they are outside the public sector. Social purpose venture enterprises; mutual, cooperative, and fair trade enterprises; and green and environmentally sustainable businesses are enterprises too; and the alliances they create are business associations too.
   Furthermore, community land trusts are trust funds too, and they are also non-profit corporations. Charities that actually help their intended recipients are charities too. And interfaith organizations are religious organizations too.

   Non-governmental and quasi-governmental agencies of all the aforementioned varieties should be considered in seeking common ground between Georgists and conservatives. But non-political agencies should also be considered. In the United Kingdom, the government has created non-ministerial government departments (NGMDs), deeming certain policy matters inappropriate for direct political oversight.
   The British government has taken steps to de-politicize that oversight by protecting the status of the agencies from political interference. In so doing, it has sought to de-politicize standards regulation of the following policy matters:
  • statistics, the treasury, cartography, qualifications and examinations, and charity;
  • land registry, rail regulation, education, and children's services;
  • food safety, water services regulation, forestry, gas and electricity;
  • trade, savings, investment. competition and markets, serious fraud; and
  • crime, prosecution, and the judiciary.
   I would also urge Georgists and conservatives alike to consider the possibility that such standardization and regulation could be performed by independent entrepreneurs' alliances like the American Independent Business Alliance (A.M.I.B.A.), the anarchist syndicate and autonomous union I.W.W., the International Organization for Standardization (I.S.O.), and/or confederations of mutuals, cooperatives, non-profits, and freelancers' unions.
   Additionally, I would urge Georgists to explain to libertarians and conservatives that tripartism - the government's supervision of negotiation and/or the joint creation of policy by organized labor and capital - is not necessarily undesirable. Communities may be governed voluntarily – and be reconciled with individual liberty and consent - insofar as people come to communities voluntarily, the freedom of travel is not unnecessarily inihibited, and society promotes collaboration on regulation of industrial policy by all sectors of industrial relations (workers, consumers, taxpayers, distributors, shareholders, non-associating but nonetheless affected stakeholders, etc.).

   I would urge Georgists to concede to conservatives and libertarians that the monopolistic State cannot compete on the market without destroying it, and also to concede – and also remind conservatives and libertarians, if they have forgotten - that the State's being monopolistic means that it cannot be trusted to act against the interests of monopoly. This is not just in regards to government, but to assist in the monopolization, oligarchy, and concentration of power within the corporate world, and even within the organized labor movement (as in State-recognized union monopoly on the representation of organized labor within a workplace and/or territory).
   Since the State cannot be trusted to abolish itself in the interest of creating a society of diverse and independent persons, peoples, and companies, those very people and companies must perform that antitrust themselves; they must compel economies of scale (actors with enormous purchasing power) to play by the rules of the market. Economies of scale - whether sellers or buyers - must only participate in trade only if their purchasing power is not so great that it distorts the natural calculation of price and upsets the equilibrium of supply and demand, through diminishing other actors' abilities to influence the evaluation of goods and services.
   However, Georgists should convince conservatives that economies of scale have to be allowed to exist with large enough purchasing power so as to be able to utilize purchasing or selling power in order to diminish the power of monopolies and oligarchies in purchasing and sales. But once again, Georgists should always concede to libertarians that if done by government, this must be done via the most minimally monopolistic, oligarchical, territorialistic, geographically centralized, hierarchical, coercive, aggressive, and violent manners necessary to defeat and prevent the concentration of political and economic power.

   Georgists should convince libertarians and conservatives that the reason government needs to tax income and everything else it taxes is because it needs to increase purchasing power against the power of large sellers. Specifically, government needs to increase its power to obtain and distribute goods and services cheaply and efficiently to taxpayers/consumers, such as education, health services, etc..
   In order to “compete on the markets” with the multinational corporations which wield enormous selling power in those markets, purchasing organizations must become large and powerful enough to sufficiently counteract sellers' demand for high prices so as to distribute goods and services to those who need them.
   When minimal-government libertarians and conservatives make arguments in favor of corporate power, Georgists should remind libertarians and conservatives that corporations would not exist in the first place without the State's monopoly power to grant limited liability, and to charter, license, permit, zone, and protect through policing or through the licensure of private security guards.
   I would hope that Georgists would understand, and concede to conservatives and libertarians, that the State inserted its monopoly power into these practices. However, this does not mean that business and private property owners owe something back, and owe it to the State; rather, it means that they should, as Senator Elizabeth Warren said, “pay it forward to the next guy who comes along.” [emphasis mine].
   “Paying it forward” might make entail giving tax incentives to private, corporate, and foreign interests which own firms; incentives which are conditional upon them planning and allowing for the ownership and management of their companies to pass into the hands of some combination of workers, consumers, shareholders, and other affected people. [Here, “companies” includes governments, which according to the U.S. Code are legally regarded as corporations.]
   Whether through competition, collaboration, or some tenuous and tentative combination thereof, government should foster a political environment featuring a diverse array of viewpoints on how standards should be made, and how regulation should be performed, and by whom (i.e., regulatory collaboration and regulatory competition). This way, what is common ground versus what inspires conflict and diffidence, may be discerned without the presence of power and finance oligarchy to demand compromise through concessions of each party's most valued principles and goals.

   An alliance between Single Tax proponents and fiscal conservatives must bring together – and focus coordination of efforts between - alienated and forgotten segments of economic society and industrial relations, such as:
  • taxpayers, shareholders, and non-owner managers;
  • independent entrepreneurs, workers, and artisans;
  • social purpose ventures and fair trade enterprises;
  • employee-owned businesses and egalitarian labor-managed firms (E.L.M.F.s);
  • purchasing and distributors' cooperatives;
  • consumer cooperatives, and consumer protection, interest, and advocacy agencies;
  • autonomous unions, syndicates, freelancers' unions, and guilds;
  • mutuals / worker-consumer cooperatives (including credit unions)
  • mutual aid societies, charity organizations and non-profits and not-for-profits;
  • voluntary local community government and agencies thereof;
  • non-governmental and quasi-governmental organizations;
  • affected stakeholders whom society perceives as outcastes;
  • coalitions of all of these aforementioned organizations;
and many others.
   These types of organizations must focus their efforts on achieving formal political representation for the Third Sector - the sector of non-profits, volunteerism, cooperation, mutuality, reciprocity, and balance in economic and political power - as an alternative to the collusion of the public and private sector to sponsor the outsourcing of responsibilities to provide public goods and services to limited liability corporate entities that serve private (ostensibly “independent”) interests.
   In doing this, it will be crucial to emphasize the principle “cost the limit of price”; that is, the idea that mutuals, cooperatives, and ELMFs are non-profit (and therefore fiscally sustainable models for governmental agencies) because they reinvest all would-be profits back into the companies in order to provide for better benefits for workers, better deals for consumers, and the elimination and internalization of unjustifiable costs of transacting with the firm.
   Such enterprises should be run on worker-consumer purchasing cooperative models. This would serve to prevent the diminution of the needs of working people - in all stages of production and distribution - to be compensated, in comparison with the needs of consumers to pay at low prices and the needs of sellers to sell high. Within these firms, privatization, corporatization, limited liability, external investment, and externalization and outsourcing of responsibilities must be kept to a minimum or eliminated completely.
   Such enterprises should be run by boards designed to balance the interests of organized labor and organized capital, but they should also promote the involvement and formal representation of people who are now politically uninvolved but whom are affected by decisions made in government; namely, mutualist anarchists, anarcho-syndicalists, leftists disillusioned by the Democratic Party, and market-anarchists and libertarians.

   I believe that all of this can and should be done within the context of a market system rather than a socialist one; specifically, a left-wing market-anarchist system (and a system of completed, perfected markets liberated and freed from oligarchy) or a social-purpose-oriented market economy, with the intent of abolishing income and sales taxes, the welfare State, and the State erection of corporate power and privilege.
   I favor this market system - a system of ubiquitous markets, competition in search of best practices, and enterprise - as an alternative to a State socialist system featuring price controls. However, experimentation with artificial markets would not be out of the picture in the quest for the perfection and completion of the market system. Neither would achieving community-wide collaboration - from all sectors of economic and industrial society - on standardization and regulation, in order to make price recommendations on goods and services.
   Additionally, I support focusing on markets and decentralized government because rural Republicans would seek to maximize their degree of influence on their own local government. Understanding how Statism is intrinsically destructive to the market is crucial for understanding the relationships between central government and power monopoly, and between local government and the power of many. Georgists would do well to emphasize their support of local community government in order to build common ground with conservatives, libertarians, and classical liberals who resent imperialism and distant political control.
   I would also recommend local control because I would warn Georgists that perceiving the economy in an all-encompassing state-wide manner could obscure the differences between urban and suburban vs. rural economies: a policy that works in a major city will often not work in the rural areas of the state, and it will usually be greeted with antipathy, even if it claims to achieve some higher standard of quality of life for rural people.
   This is sometimes because such people achieve higher standards than those set by the State all by themselves, and other times alternative standards because they see other standards they can't achieve as unrealistic expectations of unnecessary material comforts of modern life, which they would have made the conscious choice to forsake by continuing to live in the country instead of moving to a more urban environment. When such rural denizens have valid points on these matters, it would benefit Georgists to concede those points to them.

   Georgists would do best finding common ground with conservatives and libertarians by promoting citizens' dividends deriving from shares in community sovereign wealth funds, in connection with the negative income tax (as part of a transition out of individual income taxes entirely, and towards the Single Tax system).
   I would recommend that Georgists do so within a framework of a completed and perfected competitive market system that requires social purpose of enterprise and incorporation as a condition of receiving business and corporate charters (as well as permits, licenses, zoning, and of course subsidies). Such a system would feature a greater number and a wider variety of organizations and firms buying and selling in markets for public and market goods alike. This includes the markets for the regulation of standards in socioeconomic justice and fairness themselves (i.e., standards regarding quality of government-provided goods and services), standards regarding taxation, et cetera.
   It would be beneficial for Georgists to emphasize, before recommending any political solution, the necessity of ensuring that there is evidence for consumer demand for such a solution (i.e., taxpayer demand, since we are talking about the consumers of goods and services customarily provided by government, but also demand by non-contributing recipients of such services). Partnering with people and firms interested and involved in the fair trade and conscious consumer movements will be essential; as will convincing conservatives that exploitation of people, environment, and resources is economically inefficient and harmful, especially if and when there is money in the solution.
   It will also be necessary to emphasize that a business with sufficient social purpose should not be expected to pay taxes, nor expect its consumers to pay taxes on sales. Additionally, mutuality and reciprocity between ownership / management and workers / consumers should feature each of these parties being invested in one another's success. This is to say that firms should view purchasing as an investment, and reward devoted consumers appropriately with savings, special deals, consumer protection rights, company stock, and/or some other form of consumer credit.

   I would suggest that as long as Georgists are open to the idea that all income taxes are improvements to land (and, moreover, earnings, rather than the property of the State, to be taxed away as much as it pleases) which should therefore be protected to taxation - and continue to maintain and show that land taxation is a viable replacement - then they will be capable of convincing conservatives and leftists alike of the benefits of transitioning towards the Single Tax on the unimproved value of land.
   To a leftist, abolition of individual income taxes would ensure that working people keep “the full product of their labor”, and to a conservative it would ensure that working people keep “all the fruits of their labor”.
Georgists would do best to pitch the citizens' dividend / sovereign wealth fund in connection with the negative income tax in a transition to the Single Tax, in the context of the ideas that the welfare State is broken; that it should be completely replaced with an efficient, fiscally solvent voucher system that we can trust; that individual liberty, autonomy and prosperity are maximized when individuals (acting independently and/or collectively), acting in their own interests, are allowed to make their own decisions in the marketplace; and that this alone is what results in the common good being achieved.
   Now, during a time of Democratic Party dominance, is the perfect time to build an alliance between conservatives and libertarians, and leftists, progressives, and liberals, disillusioned by Democrats. We should wonder how Democrats – who are now promoting minimum wage increases and emphasizing the problem of income inequality – would react if they saw former Reagan advisers and libertarians of the left and right alike getting together to demand more than the Democrats claim to want.
   Wouldn't Democrats be confounded and appalled to see Noam Chomsky praising Adam Smith (as he has done), Gary Johnson and Ralph Nader coming together to endorse the Single Tax and to educate the public on the philosophy of Henry George, and the Tea Party coming around those ideas of Thomas Paine and Thomas Jefferson (ideas on landed property and taxation) which are reminiscent of George's?
   By demanding a citizens' dividend, sovereign wealth funds, a flatter yet more effectively progressive tax on income, and a guaranteed minimum income or universal basic income – and demanding it of the people themselves, not from the State – conservatives and leftists could reclaim the the moral high ground from the Democratic Party, working together to achieve a more equitable, fiscally efficient, effective form of government and economic system.


   Health Care, Housing, and Homelessness

   Finally, Georgists should seek to convince conservatives of the viability and practicality of the Single Tax (and the other proposals endorsed herein) by arguing that it would help diminish the power of all kinds of monopolies and oligopolies to participate and intervene in markets, thereby distorting price calculation and denying buyers and consumers the right to communicate price signals in an equitably influential manner. These markets include the markets for land ownership, speculation in land, and mortgage-backed securities.
   They also include markets for the distribution of goods and services customarily provided by government (or at least when provided to the poor), such as health services, as well as housing and other forms of relief from homelesness. Focusing on this could help tap into the conservative resentment of the State's destruction of private charity and its monopoly over “welfare” (i.e., well-being).

   However, in order to consistently oppose monopoly, I would urge members of Common Ground OR-WA who support single-payer universal health care to rethink their position, and consider that it is impractical and unlikely to occur. Not only that, but I would remind them that single-payer is a monopoly on purchasing - i.e., a monopsony – and that it is the abolition of the private market for health insurance. This practice is known as “market abolitionism”; or “anagorism”, meaning “without open marketplaces”.
   I would caution single payer proponents them that to give the State a monopoly over health insurance purchase could only serve to further increase costs, politicize health policy, and risk corruption in the health industry as soon as political administration falls into the hands of another party.
   Keeping in mind that, in a social market economy, “private” would have a very different meaning, I would caution single-payer proponents that abolishing the market for private health insurance would politicize health policy and corrupt the health industry, because Republican control of a health insurance monopsony might be catastrophic and result in cuts justified as “austerity measures”. It would also increase the health costs incurred by taxpayers, because some people might demand that medically unnecessary and/or cosmetic procedures which they do not need are their natural rights, and demand others to pay for such procedures and insurance coverage thereof.
   Instead of using the State and its monopsony to balance the immense selling power of large health insurance sellers, I would recommend that Common Ground members build alliances with and between consumer-driven health care cooperatives (while such cooperatives remain technically separate entities), and focus on tightly coordinating their efforts with the public.
   This would be done in order to concentrate purchasing power in the hands of non-profit, voluntary non-governmental or quasi-governmental agencies; so as to reduce health costs for their paying customers and non-paying impoverished beneficiaries (without necessitating a welfare State) while also ensuring that prices stay high enough to ensure that health workers are sufficiently compensated. It would also be done in order to streamline distribution and to promote collaboration on industry policy across all stages of production and all sectors of industrial relations.
   This model, if successful, might also prove to be an effective solution for other goods and services typically provided with the help of the welfare State, such as housing, and public utilities like energy.

   Keeping in mind that the State of Oregon is currently number one in the nation for homelessness and residential foreclosures, I believe that homelessness and the issues surrounding land, mortgages, and housing should be dealt with as a single issue. Georgists must (ahem) capitalize on public awareness (resulting from the Occupy Wall Street movement) of the fact that empty houses outnumber homeless people in America by more than 20-to-1.
   From the perspective of rural Republicans who are being asked to foot the bill for tax increases and tolerate the expansion of public infrastructure into their communities (raising their property values but also their property taxes), a downtown Portland full of non-working homeless people, undeveloped property, and unoccupied buildings is no signal of good things to come from modernizing the quality of life in the rest of the state.
   Georgists seeking to attract conservatives to their cause in the State of Oregon must show rural Republicans a Portland full of homeless people who are willing to work (at least, those whom are neither disabled nor sick), and can earn and spend their own money responsibly, in order to render moot any questions about whether such homeless people are incompetent (or at least any more incompetent than rural Republicans, who have denied themselves the local government they so badly need, know themselves to be).
   I would recommend that Georgists seek to solve the housing and homelessness problem by allowing homeless people (rather than requiring them, as in “work-for-welfare” or “workfare”) to work in exchange for goods and services. For homeless families, this might involve having the most physically able member of the family perform labor (while learning some valuable skill) while his or her family receives whatever food, clothing, non-emergency health care and supplies, and temporary child care for the day, that they urgently need.
   This could be accomplished through coordinating with charities coalitions, homeless advocacy groups (such as Join and Transition Projects, Inc. in Portland); veterans' groups; retirees' groups, and retirement homes, communities, and villages (such as Foster Village in Portland); community gardening organizations; university gardening apprenticeship programs (such as the Oregon State University Extension's Beginning Urban Farming Apprenticeship Program in Portland); fraternal organizations for senior citizens (such as the Masons, Shriners, Kiwanis, and Elks clubs); and staffing / consulting / human resources and job training firms that are willing to consider employing people without testing their bodily fluids for marijuana use.
   The purpose of all these organizations coordinating would be to teach homeless people about how to maintain and improve land, and could include education about homesteading and Oregon's laws regarding homesteading. One important objective would be teaching the homeless a marketable skill, building World War II -style “Victory Gardens” (this time celebrating victory in the “War on Poverty” as a war on poor people).
   This would allow the young and old alike to work together on the problems of homelessness, housing, and land reform, taxation, and improvement; allow seniors to pass on what they have learned; and allow working and non-working young people to come together to demand more opportunity in hiring (potentially calling for boycotts of staffing agencies with unreasonably high expectations of the disadvantaged).
   I would recommend that when dealing with homelessness, Georgists consistently emphasize the “hobo” as a traveling, working person; one who needs freedom of travel, realistic opportunities to work, the ability to affordably learn marketable skills, and satisfaction of their most urgent needs (without which they would not be able to work comfortably).
   Additionally, Georgists should coordinate with homeless charities and coalitions thereof to revive the defunct organization I.B.W.A. (the International Brotherhood Welfare Association), the mutual aid society which until 1922 was affiliated with the I.W.W. (Industrial Workers of the World) and offered education, job training, and religious services to traveling workers through “hobo colleges”.
   In the State of Utah, the Republican Party has given up on homelessness, deciding to simply give houses to homeless people, because they observed that the expenses of caring for homeless people's emergency needs are lesser than the costs of providing them with taxpayer-subsidized housing. Meanwhile, a Democrat in the State of Hawaii recently sponsored a bill to provide all-expense-paid plane tickets to homeless people in order to deport them to the United States mainland.
   Leftists in Oregon and elsewhere must not allow the far-right Republicans of Utah out-compete them in solving homelessness. Oregonians should look towards not only the classical liberals of old and Reagan conservatives; but to market-anarchists, libertarian, and Agorists; for inspiration regarding finding and developing new models for urban development, taxation, residential property protection, and provision of welfare. The Free Detroit Project is just one example.

   In closing, I would like to ask: “Is it any wonder that a state that has no sales tax - but the most government revenue deriving from individual income in the country - has so much poverty, and homelessness (as well as prostitution)? What do you expect to happen when you impose such high barriers to earning and keeping money, and almost completely knock down barriers to selling?”
   The result is that people will be effectively discouraged from working through high income taxes, so they won't earn any money (at least in any legitimate way where they would report it, and moreover not be monetarily penalized for doing so). The only thing left for them do – due to there being few barriers to selling – is to sell whatever little they have left (and to, once again, not report the resulting income). Once they have sold all their material possessions, all they will have left to sell will be themselves.
   We must remove financial barriers to transitioning from welfare to work, promoting the various workers' organizations which are unique to Portland (including artisans' enterprises, independent tech meetups, and freelancers' unions), and provide better standards of living for the public. The Single Tax, negative income tax, social market economy, sovereign wealth fund, citizens' dividend, and guaranteed minimum income accomplish this.


   Happy Tax Day!




For more entries on enterprise, business, business alliance, and markets, please visit:
http://www.aquarianagrarian.blogspot.com/2010/10/enlightened-catallaxy-reciprocally.html
http://www.aquarianagrarian.blogspot.com/2014/05/agorist-protection-agencies-and.html

For more entries on natural resources, please visit:
http://www.aquarianagrarian.blogspot.com/2010/10/case-examination-of-policy-for-natural.html

For more entries on the social market economy and the third (voluntary) sector, please visit:
http://www.aquarianagrarian.blogspot.com/2014/04/diagram-of-public-private-and-third.html

For more entries on social services, public planning, and welfare, please visit:
http://www.aquarianagrarian.blogspot.com/2014/05/taxpayer-funded-benefits-for.html

For more entries on taxation, please visit:
http://www.aquarianagrarian.blogspot.com/2014/05/tax-cuts.html

For more entries on theory of government, please visit:
http://www.aquarianagrarian.blogspot.com/2014/05/the-general-welfare-clause.html

For more entries on unions and collective bargaining, please visit:

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