Jim Clarkson: The Great Adventure

George's fame led him to be drafted by the United Labor Party to run for Mayor of New York in 1886. George lost to Abram Hewitt (and Theodore Roosevelt came in third). George wrote several books, including Social Problems, Protection or Free Trade (which was read in its entirety into the US Congressional Record) and others. George's remedy was born out of the classical economists Adam Smith and John Stuart Mill's beliefs that the unearned increment from the rent of land belonged to the people. Others who believed the same way were Thomas Jefferson, John Locke, Thomas Paine, Mark Twain, Abraham Lincoln and Winston Churchill (to name a few) and without a doubt Mr. Alan Brett, my mentor whose name "Alan" I gave to my fourth son.

My own experience of land ownership came about from a speech I gave before the Southfield Economics Club when I was given the name of "Sour Grapes". Why the name "Sour Grapes," I asked the name caller. "Simply put, he said, "you do not own any land." It was then I knew that to prove speculating in land would reward me with unearned wealth, I had to invest in land to prove the point.

The first of many speculative ventures, for instance, was when a house came up for sale on Southfield Road just North of Ten Mile Road. I convinced my law partners to join with me in its purchase. I knew that Southfield Road would be widened to four lanes and increase its value. We purchased the property with $3,000 down on a land contract for $18,000. Just over six months later we sold it for $32,000. All the profit was from the increase in the value of the land and was unearned.

It took some courage to practice what I preached, but once after the first experiment in this adventure, I was forever hooked and consequently, found myself rationalizing my action by espousing the merit of land value taxation and thereby justifying my investment in land as a means to prove my point. The practical aspect of this is easily understood when in the talks that I give, and have given, across the nation and in Canada, I could more easily ford the question that implied that my advocating of land value taxation was but "Sour Grapes" for my failure to have benefited from the system.

Not all nations or political subdivisions have failed to "see the cat", but many have adopted various forms of Land Value Taxation -- for example, by differential rates of taxation by placing a higher percentage on the land than on the improvements. The State of Alaska, for example, has secured the value of its oil royalties for their citizens by what is called the Alaskan Permanent fund.

Governor Jay Hammond introduced a proposed Constitutional Amendment to create the Permanent Fund in 1976, and it was approved by the people that fall. From then on, 25% of all mineral lease rentals, royalties, royal sales proceeds, federal mineral revenue sharing payments, and bonuses received by the state were placed into the Permanent fund. Every man, woman and child in Alaska with a qualfying 12-month residency is entitled to a portion of each year's earnings. In 1998 each resident received $1,769.84, and for 1999 it was $1,963.86. Just think, a family of four would receive $7,855.44.

This could be done in every state in America. Land values belong to the people. Let us give it to them! It is up to you to advocate the change or become a Land Lord. ... read the whole article

Mason Gaffney:  What happens when a state radically slashes its property tax?

Michiganders are saying they must wait and see, but there is no need for that: California can show you 17 years of experience. To read your future, just study our past. Here is what has happened since California passed Proposition 13 in 1978.

• They turned property from a functional concept into a sacred one; from a commission to be enterprising, hire people, produce goods, and pay taxes into a welfare entitlement.
• They rejected the concept of a tax on inert wealth in favor of the rival concept of taxing liquidity and cash flow.

Why is that not happening today, 1995? An invisible, pervasive change is Proposition 13, which makes it possible to hold land at negligible tax cost. In 1945 land was taxed at 3% every year, building a fire under holdouts to turn their land to use. Today that same tax cost is well below 1%. Using Gwartney's Rule of Thumb (see below under B,1), it is about 1/8 of 1%: a rate of 1% applied to 1/8 of the true value.

Landowners are only taxed now if they use their land to hire people and produce something useful. Then they meet the drag of our high business and employment and sales taxes, necessitated by the fall of property taxes. A handful of oligopolistic landowners control most of the market; small businesses are squeezed out. This helps us segue from being at the cutting edge of industrial progress to a third-world economy - from the NH model to the AL model - with little relief in sight. ...