What about the relevance of Georgist ideas to current concerns with environmental
quality and ecological sustainability? Here too there is a strong claim to
consider. Interest in Georgism has been reinvigorated in recent years by
the need to develop public policies that reflect the nature of land as a
finite natural resource. From a ‘green’ perspective, land tax
is a useful tool in discouraging the excessive and wasteful use of land.
That is, the prospect of paying a high rate of land tax can be expected to
discourage people from purchasing more land than they need directly for their
own purposes. It accords with the principle that people should be taxed according
to their use of scarce environmental assets.
This ‘ecological take’ on Georgism is particularly powerful
at a time of intensifying global environmental problems and recognition of
the need for remedial policy responses. It requires creative extension of
Georgist principles because the limitation of George’s own analysis
in this context is its primary focus on land. A range of other natural resources
needs to be considered, linking up with the broader concerns of modern environmentalists
such as Herman Daly (see, for example, Daly and Cobb, 1990). Hence, land
tax should be seen as an adjunct to taxes on the use of other scarce environmental
assets, including mineral, forestry and fishing stocks, and also bandwidth
for radio and telecommunications, for example (Stilwell, 2002: 316-317).
It should also be seen as a corollary to other taxes that discourage environmental
damage, including resource rental taxes, carbon taxes and fuel excises.
The case for these environmental taxes need not necessarily rest on Georgist
principles, of course, but Georgism can claim to provide a unifying analytical
framework. A common feature of ‘environmental taxes’ is that
they are all targeted, like land tax, at reducing the scope for profiting
from the private appropriation of natural resources, and thereby restricting
the profligate use of those resources.
A tension remains, reflecting the Georgist orientation towards taxes
rather than more directly regulatory interventions. Whether the
use of the price
mechanism in this ‘environmental fine tuning’ is
sufficient for dealing with pervasive environment threats
is a moot point. The nature and
severity of environmental stresses is such that more directly
proscriptive environmental policies are commonly needed to
protect natural resources.
The creation and maintenance of national parks, for example,
constitutes a necessary direct regulation of land-use: the
market, even when modified
by taxes, cannot absolutely guarantee the conservation of
such crucial assets. In other words, protection of ‘natural
capital’ may
commonly require regulation as well as taxation. ... read the whole article