Tuesday, March 09, 2010

Conference: Why is so much wealth in the hands of so few?

The conference title says it all. And it won't come as a surprise to those who know us when we say that the tax system is both a contributory cause and a potential solution to the problem.

This conference, which will be held in London from 26th to 30th April, is being organised by the International Union for Land Value Taxation (IU). The conference will address some of the fundamental economic issues about tax that need resolution as part of any new and progressive programme to address poverty, inequality and environmental degradation. The programme details are here.

Even the most cursory examination of tax regimes in most countries will show that Land -- by which we mean the entire range of natural resources used in the production of goods and services -- is generally undervalued and massively under-taxed. Take Latin America, for example, where natural resources have largely been appropriated by a tiny elite, often tracing ownership to the era of the Conquistador, who have successfully resisted any attempt to tax their wealth, or the rents that flow from it. We don't need to elaborate on the consequences: the waste of scarce resources, the regressive tax systems, the appalling inequality, and the criminality, violence and insecurity that flows from it.

The case for taxing the rents from Land is compelling, and this conference, organised by the International Union for Land Value Taxation, is timely. At a time when governments across the world face almost unprecedented pressure to protect public services in the face of mounting fiscal deficits, new solutions are required that do not involve imposing higher taxes on low income households: Land Value Taxes are an idea whose time has long since come.

To quote Henry George (pictured), one of the fathers of the Land Value Tax campaign:

“I asked a passing teamster, for want of something better to say, what land was worth there. He pointed to some cows grazing so far off that they looked like mice, and said, 'I don't know exactly, but there is a man over there who will sell some land for a thousand dollars an acre.' Like a flash it came over me that there was the reason of advancing poverty with advancing wealth. With the growth of population, land grows in value, and the men who work it must pay more for the privilege."

As his Wikipedia entry notes:

"He inspired the philosophy and economic ideology known as Georgism, which is that everyone owns what they create, but that everything found in nature, most importantly land, belongs equally to all humanity."

TJN sees this as an important issue - we blogged on the importance of land value taxation recently - and we will be participating in the conference and we hope to see many of you there. Read more here.

PS The next edition of Tax Justice Focus, scheduled for publication before the conference next month, has land tax as its core theme, and is being guest edited by Carol Wilcox of the Labour Land Campaign - drop us an email at info(at)taxjustice.net if you want to be added to the free circulation list.


Blogger Physiocrat said...

Thanks for your support

1:57 am  

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