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Mutualist Blog: Free Market Anti-Capitalism

To dissolve, submerge, and cause to disappear the political or governmental system in the economic system by reducing, simplifying, decentralizing and suppressing, one after another, all the wheels of this great machine, which is called the Government or the State. --Proudhon, General Idea of the Revolution

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Thursday, June 30, 2005

Almost Thou Persuadest Me: Or, Why I Am Not (Quite) a Georgist

I participate in a lot of Georgist discussion forums, and have quoted quite a few Geolibertarians of various stripes in my blogposts. Generally speaking, I am on quite friendly terms with Georgists, and have a lot of sympathy for their ideas. But I've never found their arguments convincing enough to embrace full-blown Georgism.

Of course, the individualist anarchists' occupancy-and-use ideas on land ownership have a lot in common with Georgism. Both theories are outgrowths of the radical fringe of early classical liberalism. They both, in very Ricardian terms, tend to see landlordism as a form of parasitism, a sinkhole that absorbs the fruits of progress created by human labor and ingenuity. Both theories, as distinguished from mainstream Lockeanism, are premised on the understanding that "land is different," because "they're not making any more of it." Both mutualism and Georgism operate on the assumption that, both because of this limited supply, and the fact that they are not the product of human labor, land and natural resources are in some sense the common inheritance of mankind. The Georgists treat the community as steward for this common heritage in a much more active way, seeing it as the proper agent for collecting the compensation owed everybody else when somebody removes a piece of land from the common. Mutualists and individualists see the common property in land as a much more residual thing, extending only to refusing to enforce absentee titles on behalf of someone who wants to exclude others from a piece of land, when he isn't using it himself.

Although I don't (ultimately) go along with the idea of a land value tax on ordinary commercial and residential land, I am quite favorable to the Geolibertarian idea of treating especially limited resources (aquifers, old-growth forest, mineral deposits, coastal and riparian frontage, etc.) as a common, with the community regulating access to them.

And although I don't favor the LVT as part of an end-state society, I'm a lot more open to it as a transitional measure. That is, if we accept that the state will be abolished gradually, and that some taxation will take place in the transition period, a tax on the site value of unimproved land is probably the least unjust tax anybody could come up with. If my state or local government proposed abolishing sales and personal property tax, and real estate tax on buildings and improvements, and shifting it all to an increased tax on site value, I'd enthusiastically support it.

All this being said, I still haven't been sold on the full package of goods. For one thing, I don't believe there are many (if any) genuine "public goods" that can't be funded by user fees on the people actually benefiting from public services. And when a service can be funded by user fees, I prefer to do so. People make much more rational use of such things when they're priced according to cost and they have to pay for what they use, than when they're funded out of general revenue. So either the rent the community collects will be extremely low, or there will be an almighty big citizen's dividend from what's left over.

I also don't think the problem of economic rent is that serious, in and of itself. It would be mitigated considerably under an occupancy-and-use regime, and a society in which public services were provided on the cost principle.

For example, a great deal of the present inflated value of favorably situated land is actually an externality from subsidized infrastructure. Good schools, subsidized roads, utilities, etc., drive up property values when the recipients of these goods don't pay the full cost of providing them. If they were funded on a cost basis, and the people using them were assessed the full cost of providing the service, it would reduce the demand-driven market value of real estate quite a bit.

A lot of inflated site value in urban areas also results from artificial scarcity: that is, it's really an indirect result of absentee landlord rent, not economic rent as such. Nock, despite being a Georgist, himself noted as much in his discussion of the political preemption of land. A great deal of the scarcity of land is artificial, resulting from large parcels being held vacant by absentee owners for speculative purposes. If all such land in built-up areas were opened to settlement, the rental value of the rest would go down considerably.

In addition, economic centralization increases the scarcity of favorably situated land. It's simple geometry. When industry is small-scale and for local production, and population is dispersed into lots of pedestrian-bicycle friendly mixed-use communities of a few thousand people, it will be a lot easier to find commercial land within a short distance of one's customers. Likewise zoning restrictions on mixed-use development, which artificially increase the distance between where people live and where they shop and work. When economic activity is dispersed and local, and neighborhoods include both homes and businesses, favorably situated land will be a lot less scarce compared to the general population.

12 Comments:

Anonymous Dmytri Kleiner said...

Hello Kevin.

We hold a simular view on Georgism, in fact if anything mine is a little more favourable, as I have more belief in the concept of Public Goods, as along as they are not artibrarily distrubuted, such as by "means testing" and operated by volunary associations, not involuntary ones like the State, I don't see having "User Fees" for all common wealth to be desirable nor practicle.

However, I see Georgism as yet another utopian longing that can never be a transitional strategy.

Georgism requires that the Single Tax be adopted by the State.

As we both understand the State to be the apparatus of the Elite, in other words, of Property, this means that the strugle between labour and Property must be won _BEFORE_ Georgism can be implented. What good is a transitional strategy that can only be implemented AFTER the transition?

Why on earth would the aparatus of Property implement a policy against the interests of Property??

As George's own theories show, land absorbes all economic activity beyond the costs of the other inputs. Meaning that only those that own land are able to accumulate wealth. How the heck are the landless supposed to apply enough wealth to change the State, when the landowners can apply more wealth to prevent any such change?

Any "transitional strategy" must be adoptable with the assumption that the State is not yet captured/destroyed.

Any Strategy such as Georgism, the Tobin Tax, or any other idea that if only the State would change something, everything would get better amounts to the hope that the Elite will volunarily abandon their priveledge -- a nonsensical prospect!

Regards,
Dmytri.

June 30, 2005 11:39 AM  
Blogger Kevin Carson said...

There are some anarcho-Georgists who favor collection of rent by the community (as opposed to state), with land being a socially owned common.

Fred Foldvary, a more or less anarcho-cap Georgist, likes the idea of private communities funding services through site rent.

June 30, 2005 4:27 PM  
Blogger Richard said...

Hi, Mike - this reminds me of why I love Tucker's Instead of a Book. I am studying left-libertarians like Hillel Steiner or Peter Vallentyne for my PhD at the moment. Upon recognising that they are essentially Georgists, I thought I'd dip into Instead of a Book to get some response and found exactly my doubts echoed there! Tucker fisrtly asked why "the community" was any more entitled to collect economic rent than the user-occupier. The assumption (argued by "Egoist" in the book" that collection of rent is a price that the appropriator owes the community in exchange for getting the rest of the community to give up its ability to use the land can be perfectly reversed - why can't the individual charge the community if the community appropriates the land. "the community" has no better title to land than anybody else, it being nothing more than individuals.

And then there is Tucker's recognition of the fact that the argument that appropriation of land deprives others of their freedom to use it can be levelled at appropriation of anything - even self. Left libertarians, like Steiner or Vallentyne, who accept self-ownership but not uncompensated land ownership have a challenge explaining why depriving people in one case is fine, but not in the other.

June 30, 2005 5:05 PM  
Blogger Kevin Carson said...

richard,

I think their difference lies in Tucker's Stirnerism, especially his radical epistemological individualism. The Georgists start out from a radical Lockean premise of collective ownership--something that Tucker would immediately dismiss as a Stirnerite "ghost."

June 30, 2005 7:51 PM  
Blogger alan said...

Georgist ideas also appeal to me as well, though I see his key points as having more relevance within a social credit context. Much, if not most, of the "cultural inheritance" that makes our present state of prosperity possible is made of land value.

Irrespective of how land is held, land is the strongest component of our real credit, and so I favour the distribution of a "citizens' dividend" based on drawing upon real credit for the purpose of liquidating the costs of production.

July 01, 2005 3:33 AM  
Blogger Shawn P. Wilbur said...

Those interested in the non-state approach to Georgism should hunt down any of the volumes of the yearly series "Enclaves of Single Tax: Being a Compendium of the Legal Documents Involved Together with a Historical Description" collected by Charles White Huntington. (Some volumes are titled "Enclaves of Economic Rent.")

A few of the enclaves have web sites as well:

Free Acres (Bolton Hall): http://www.freeacres.org/
The Ardens: http://www.theardens.com/
Fairhope: http://www.fairhopesingletax.com/

July 01, 2005 9:22 AM  
Anonymous Anonymous said...

Shawn, thanks for those links, that is most helpfull, I was wondering if you knew of any such rent sharing communities outside of the US especially over here in Europe.

Regards,
Dmytri.

July 04, 2005 2:59 AM  
Blogger Kevin Carson said...

A perplexing problem (to me, at least) about handling non-Lockean land arrangement in such private communities is this: how to deal with the fact that the initial membership had to buy their site from a Lockean outside world?

I can see that it wouldn't be that much of a problem for a Georgist community. But it was a big problem for Warrenite communities, who had to incorporate compensation for initial purchase price into a regime otherwise based on occupancy and use.

For that matter, if a Georgist community is privately owned by a landlord, he may fund services through rent based on site value; but he himself, if he's making a profit, is a net gainer from economic rent unless *he's* paying LVT to somebody.

July 04, 2005 10:54 PM  
Anonymous P.M.Lawrence said...

A private owner of a Georgist community is in many ways like the proprietors of certain early American colonies. Where they had to provide the settlers in their "plantations" (so much for the Georgist idea that the people were just there to be ripped off), the new acquiring owner has to invest in other ways: he has to buy the established site. The value added up to that point is not a gain to him but is factored into the seller's profit - most likely some level of government. If he truly sets up a Georgist community, he will find himself expropriated like the proprietors or the Dutch patroons, and meanwhile he must provide services to the community until it is strong enough to do without him as an intermediary (or it would not be a

July 06, 2005 6:39 AM  
Anonymous Anonymous said...

Can anyone help me find an article written by my grandfather Bolton Hall about the Spanish american war or one written on Cuba about 1901?? Scott Herrick

December 02, 2005 2:37 PM  
Blogger Scott F said...

Kevin,

Would you agree that the occupancy and use view leads to the idea that land which can be used collectively can be collectively owned while in use yet not exclusive?

July 27, 2011 1:17 PM  
Blogger Kevin Carson said...

I think so. In researching my C4SS paper for later this year, I've seen the pernicious consequences of established villages trying to control access to uncultivated waste that might be otherwise colonized by landless peasants.

July 27, 2011 2:10 PM  

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