The Geonomist Volume Eight Issue Two

The series of feasts and featured speakers in the home of Matteo Luccio, editor of the magazine Oregon's Future, continues with "Taiwan Tomorrow, Grey or Green?" After an update based on our recent trip (see next column and page 8), we'll discuss how this Asian Tiger avoided the "Asian flu" (fallout from the currency collapse), how this leading chip maker set the world record for growth, and why an island that tripled its human count in 50 years is shifting its taxes. Dine at 6, chat at 7, by Reed College, at the intersection of SE 28th & Steele. To coordinate dishes, RSVP to Matteo at 235-6679 or matteo@teleport.com.

Geonomics is …

the policy that the earth's natural patterns suggests. Use the eco-system's self-regulating feedback loops as a model. What then needs changing? Basically, the flow of money spent to own or use Earth (both sites and resources) must visit each of us. Our agent, government, exists to collect this natural rent via fees and to disburse the collected revenue via dividends. Doing this, we could forgo taxes on homes and earnings and subsidies of either the needy or the greedy. For more, see our web site, our pamphlet of the title above, or any of our other lit pieces; ask for our literature list.

Vanquished. As capitalism gave, so might it get. What's needed is one country to buy into geonomics deep enough. Its stellar results will force other nations to follow suit, leaving capitalism, that old partnership of elite and state, in the same dustbin of history alongside its anti-twin, communism.

Is there a candidate to go first? Taiwan might. It has a history of successful land reform. Its academics are well versed in ways to collect natural rents; three of them advise the presidential contender ahead in the polls. Its activists and progressive policy makers are receptive to shifting taxes off effort, on to the use of our common heritage (earth). Their legislature's Sustainable Development Committee had your editor testify for two hours in December on geonomic revenue reform.

The opposition is entrenched. Yet demand for clean politics, for affordable housing, and for a healthy environment is strong. As a compromise, the ruling party may be mollified by a Housing Voucher, funded from site value and good for buying or leasing land or buildings. Since real estate is the main asset of opponents, a housing voucher may just pacify them. (See inside).

The "Battle in Seattle" was a building block, especially as more of us heed Robert Theobald. Before passing last fall, he said: "'The multinational firm is the visible face of capitalism and must be destroyed.' The style in this story is oppositional. The energy goes into defining what is wrong and fighting it. This approach makes the problems of our day visible. At another level, however, those who attack capitalism may maintain our current ways of thinking about the world and reinforce the old story; opposition reinforces the vitality of the categories within which we live unless it turns the danger of the old story into the opportunity of the new one." To promote a supplemental income, Robert had meetings with Nixon and once asked me why the idea of sharing rent is so hard to grasp. Cuz it's for all, not against some?

Anglo Americans don't, but Latin Americans do. Unabashedly, they discuss funding public goods from the publicly-generated values of land. In Cuba, the constitution commands them to. Today's document retains the influence of Cuban national hero, Jose Marti. In the 1880s, he was a reporter in New York where he read the works of proto-geonomist, Henry George. (London's Land & Liberty, '99 Aug/Sep)

Last summer, officials including Ricardo Alarcon de Quesada, President of the National Assembly of People's Power, told visiting German and American geonomists including ex-US Attorney General Ramsey Clark that the government intends to collect the value of sites and resources for the benefit of the people and invited the delegation back to a conference on globalism.

This past January, over 1,000 delegates from 200 countries attended the conference. Of 200 papers, only 50 were presented, including those by the geonomists who alone focused on solutions. The audience nearly besieged them for name cards and copies of the talks. Bohemia, the Cuban equivalent of TIME magazine, which Fidel Castro reads regularly, interviewed the crew. Dr. Michael Hudson was also interviewed by television and invited to the University of Havana to hold seminars with faculty. Hudson, while ex of the World Bank, has socialist roots and related sharing land rent to the problems of debt, dependency, and maldistribution. Dr. Kris Feder of Bard reported, "the only way we could have made a better impression would have been to bring Elian Gonzales with us from Miami!"

In Chile, progressives propose getting all the rent (all the annual value of sites and resources). Liberals (classic liberals, more like libertarians in the US) propose getting some. They find acceptable funding infrastructure improvements from the resultant rise in land value, but oppose collecting any more than that. (Land Lines, 2000 Jan, Lincoln Inst)

Colombia has a law that lets cities collect rent after negotiation with landowners. Applying the law could resuscitate Columbia's economy. Arrests of cocaine exporters (after US pressure) drove their billions out of the country. Capital flight from other businessmen and investors soon followed into offshore banks (Oregonian, 99 Dec 5). Now, while land values bottom out, a site value charge would gently spur owners to improve their lots, to switch from speculation to construction. The new jobs and housing would spread prosperity to those needing it most.

Japan went the other way, Via Keynes, and failed. Rather than let a market freed of speculators respond to real needs, the government lowered the already minuscule land tax and (after US pressure) tried spending public yen (1 trillion $) on excess infrastructure. Finally given a say, the Japanese people voted against funding a useless dam by nine to one. Even if Japan can afford its mistakes, most of the world can not. One third of us live on a dollar a day. Poor people were somewhat improving their lot until the collapse of the currencies of Russia and Asia (Oregonian, 99 Dec 8), when their real estate bubbles burst. For the Third World to develop, its countries could try the Taiwan technique of collecting rent, breaking up land monopoly, and combine that with the Hong Kong plan of low taxes, attracting investment. To make sure the development is sustainable, get some rent as an Ecology Security Deposit and as Restoration Insurance. People in the developed world could help most by setting a good example - geonomics at home.

Weathermen say the world is warming. Surface temperatures are up; La Nina (seasonal cooling in the Pacific) failed to lower them. And the atmosphere didn't rise with them. But in between, it's warmer (Oregonian, 2000 Jan 14), thanks in part to gas-burning engines.

To cut smog, US EPA officials required methyl alcohol be put in gasoline. Now both gas and alcohol, which is carcinogenic to us and corrosive to metal, leak and threaten drinking water (Oregonian, 2000 Jan 22). It's hard to regulate our way to a healthy environment. Instead of imposing shortsighted rules, let's require fuel producers to put down deposits, carry insurance, and buy permits at full market value. Combustion engines would then cost more to run than electric motors, which by now would be as ordinary as electronic mail.

Fuels (Exxon) and motors (GM) are only part of the problem. Climate changes while we're stuck in traffic; traffic worsens worldwide - less rapidly around Portland which did not widen its freeways (Oregonian, 99 Nov 17). Staying hooked on cars, tho', keeps cities sprawl- ing, covering erstwhile woods and farmland. The conversion rate jumped from 1.4 million acres a year during the 10 year stretch from 1982 to 1992 to 3.2 million a year during the five years from 1992 to 1997, a loss the size of West Virginia. (USA Today, 99 Dec 8) The pace is less rapid in Oregon which decades ago drew borders around its cities (Oregonian, 99 Dec 8).

We could use the food and shade, plus land covered with concrete and asphalt doesn't breathe as well ground covered with vegetation which absorbs carbon oxides, the insulating gas warming the earth.

Switching from driving to riding is key. Money should be no obstacle. Buses and light rail can pay their way; they augment site values around transit stops by more than their cost. Hong Kong paid for its new subway with site rent. Collecting rent also defeats speculation. As owners quit speculating and start building, the new structures fill cities with more workers, shoppers, and residents - riders for transportation alternatives. Conversely, as long as we let rent be an object of speculation, land remains a commodity, and our environment must continue its slide into the abyss.

One alternative to generating electricity by exhausting heat into the air is to extract heat from the earth. Geothermal power plants are now targeted for federal funds (Oregonian, 2000 Jan 24). Pumping water into the earth's hot spots, then getting steam back at the surface to power the pumps and generate electricity is either another boondoggle like other subsidized ventures - nuclear, fusion, getting oil from shale, dams without fish ladders - or not. If not, if there's money to be made, why won't private funders pony up the capital? If they need encouraging, let's de-tax their returns and re-tax natural resources. That'll shift investments from oil and coal to windmills and whatever else works automatically.

Another subsidized power source, dams, are extinguishing salmon, the Northwest's signature species. Damming rivers, a consequence of politics not markets, soaks up dollars that might have been invested elsewhere. Using hydropower satisfies demand that other generators - windmills, photovoltaic arrays, etc - might have met.

Subsides also tilt real fields. Knowing public money often bails them out, developers build on fragile hillsides and residents buy in flood-prone lowlands. In Texas, subsidies rebuilt a house by a river 16 times in the last 18 years (Blumenauer's Building Livable Communities, '99 Dec). Across the Columbia from Portland, US tax dollars - 11.4 million of them, another $24.5 in loans - are buying out 100s of homeowners whose houses are crumbling down sliding slopes (Oregonian, 99 Dec 5). While individual residents should not suffer for a mistake most of us were liable to make, the attitude of daring nature must stop. Local Congressman Earl Blumenauer, while no staunch supporter of the public's right to land rent revenue (previous Geonomist), did introduce a bill, "Two Floods and You're Out". Eventually, more than just quit the subsidies, we need to collect Ecology Security Deposits and require Restoration Insurance. Both charges will guide developers and their buyers from risky sites.

Meanwhile, agri-business benefits from our largesse. A study before the Iowa presidential caucus found 80% of subsidies fund only 11% of "farmers" in Iowa (typical of other states), mostly corporations and investors, not family farmers. (Wall St Journal, 2000 Jan 14). Tilting the field like this makes growing organically an uphill battle.

Land keeps pushing up the cost of housing, now averaging almost $200,000, up 5.9% from last year, over twice the rate of inflation. The most affordable major market continues to be land-taxing Pittsburgh, where the average dropped 2.3% to $129,200, well ahead of second place St. Louis at $143,700. At 1/3 million, the least affordable continues to be San Francisco, with San Diego third and LA fifth, in California, home of the Prop 13 property tax cap (San Diego Union-Tribune, '99 Nov 21).

When will land prices slow, stop, even reverse? After rising most of the 90s, is a dip due? The percent of homeowners behind on mortgage payments is still low (about 5%), altho' consumers late on credit card payments is up a bit (about 8%). The National Association of Realtors predict record sales again this year, then a mini-dip next, and a brief recession in 2002, followed by a boom until 2006 (San Diego Union-Tribune, '99 Nov 21). Corroborating that guess, according to the 18 year land price cycle, the next nadir is due about 2007 or 2008.

Land value is the indicator of social progress. People want to live where society (and nature) is doing well. Were we to collect and share this public asset, we could cheer the steady climb in site values. When they glide back down, shrinking our shares, we'd work more again, taking advantage of the opportunities springing up when and where land is affordable.

A nimble entrepreneur along a border between states of different tax rates can finagle a tax break for his firm from one jurisdiction then hop over the line and keep house in the jurisdiction refraining from taxing income. Near Portland, a county government cut its taxes upon Intel, one of the richest corporations around ("Intel Inside" … the corridors of power), shifting the burden to everyone else (Oregonian, '99 May 9). Meanwhile, investors cashing in their high-tech stocks take up residence in Washington, just a salmon leap away, which, unlike Oregon, does not tax income. Oh, such gratitude! (Oregonian, '99 March 31)

While the bigger the business, the bigger the tax break, everyone gets something. To keep everyone committed to taxation, each tax comes with a 100 exemptions. Nevertheless, Jane and Joe Worker work from January first until sometime in the spring to pay off all the direct and indirect taxes. The exact date, under dispute, ranches from April 15 to May 20. Besides the lost time, there's the lost output. Taxes cost the US economy $1 trillion per year; the UK economy L400 per year (The Losses of Nations, editor Harrison, Fred, '98)

Not satisfied by deductions, some dodge taxes less than legally. The IRS can't catch everyone, especially when staffing is down and complex rules are up. Over the last two years, audits are down 1/5th, liens down 2/3rd, levies down 6/7th, and seizures fell from 10,000 to 161 (Oregonian, '99 Nov 25). Enough rich don't pay, and many employers don't turn over payroll deductions, waiting for the 10 year statute of limitations to run out, that billions go uncollected. (Oregonian, '99 Oct 10) Yet maybe it should be billions more. Whose money is it, anyway? It belongs to the producer, not the public. We, the people, have enough of our own that we need not tax others'. The annual value of sites and resources - that belongs to all of us. Collecting that, we can end taxation and quit making criminals out of delinquents.

Taxes are not a necessary evil. Neither fair nor efficient, their role can be fulfilled by fees. Like prices, fees can be set by market competition, fall only upon those who purchase the social service, and are hard to avoid.

Equipped only with fees, government would find it difficult to capture people's private earnings, yet easy to collect the publicly-generated values which attach to land. Just raise the fee for deeds and collect it annually. Even if Intel and all its uncles were to pull up stakes for cheaper pastures, they'd still have to pay their deed fees back here. They'd either sell their campus to someone who does appreciate the region, or more than likely they'd never take off. In Australia during the last recession (remember the 70s?), the towns that tax land gained new business while those relying on the conventional property tax lost twice as many firms.

Politicians have no right to bestow rent, via hundreds of loopholes, upon big business, and no right to take earned income via taxes upon anyone. Respect rights, and capital won't flee. Hong Kong, often voted the world's best city for business, exists on public land and levies very low taxes. Let the rich stay. They pull up land values. Collect this rent then disburse it among all residents. As land values go up, so would the land dividend. Residents could live where they love and love where they live.

Cheat on taxes, cheat on subsidies, do both labor and capital. After years of paying billions for $400 toilet seats and the like to a handful of weaponeers, finally the US sued Boeing and Rockwell for a few million in inflated billing (Oregonian, 2000 Jan 13). To halt the tens of millions spread out over hundreds of workers, government agencies investigated claimants getting compensation for disability (Oregonian, '99 Nov 25). But in this era of automation, how else can workers shrink the workweek? One way is to forget compensation and subsidies altogether and pay everyone a fair share of collected rents. How much might be your share? The $30,000 Solution by Bob Schutz (reviewed in a previous Geonomist) wrote that each member of a family of four would get over $7,000. Could you live with that?

Eventho' vacations are not longer, you're living in the longest stretch of economic growth in US history. The way you can tell is credit card debt is deeper than ever. Both parents work and kids start sooner. What's next? Pets will have to find jobs? And whose income is up? During the Nitro Nineties, it edged up 1% for the bottom fifth yet swelled 15% for the top; their increase was more than the total income of the bottom.

Net worth from 1995 to 1998 is even more skewed. The bottom fifth lost 25% to be worth $3,600. The next fifth lost 20% to $24,800. The mid fifth gained 6.3% to $60,300. The fourth fifth gained 20% to $152,000. The top fifth gained 22.4% to $1.73 million. Like steep "J" curves? Plot this trend on a graph. (Orgn, 2000 Jan 19).

Income up, inflation down. Credit for low inflation is given to profit rising faster than wages. Blame for inflation is slapped on labor costs, not capital costs. Ignored altogether is the cost of land. Making capital more expensive by raising the lending rate is how the Federal Reserve says it fights inflation (they're direct descendants from the guys who treated the sick with leeches). The Fed's strategy is wrong, says Mark Weisbrot, Co-Director of Stanford's Institute for Economic Policy Research (Oregonian, Feb 1)

Given rising productivity and advancing technology, why are prices rising at all, even a little bit? It's because material progress can not keep up with the issuance of excess cash. When there's more notes chasing less output, the value of the currency falls and prices rise. Our monetary system issues new notes when people enter debt. As both public and private debts swell, so do notes overflow and prices inflate.

Inflation would be even worse were it not for the so-called trade "deficit". We get their goods, they get our ever-weakening money. Such a deal! Ninety-nine's record-setting $267 billion "deficit" exceeded last year's record by $100 billion. Lots of excess dollars exit thru that door. (Oregonian, 2000 Jan 21)

Is low inflation OK or is it like a low fever? Because food and energy fluctuate so much, the producer price index no longer counts them. You ever try to leave food and energy out of your budget? I did and only got cold and hungry. The consumer price index was up "only" 2.7%. But do the math. At that rate, prices double every 27 years. Before one retires, the cost of living doubles. In one's lifetime, it octuples. Do inputs double during a career? Do values octuple in a lifetime? No. Inflation is not like the weather, something we must put up with. Accepting it puts us on par with cattle. When prices inflate, those issuing notes should be held accountable and rendered impotent.

Render them powerless. End subsidies; that ends the pressure on government to borrow. End taxation; that makes government a risky borrower, curbing public debt. Collect rent; that lowers the cost of land and makes land useless as collateral, curbing private debt. Disburse the rent among citizens; that will replace the money that people now must borrow. Curbing debt both public and private ends the debauching of notes. With currency stable, prices will fall as technology advances.

Shifting taxes and subsidies also narrows the income gap. Zero subsidies cuts out corporate welfare, toppling exorbitant incomes. The citizens dividend, paid from the fast-growing value of the earth we use, lifts the income floor and let's us shrink the workweek. It's not conventional wisdom, but it works.

If convention were wisdom, mainstream prognasticators ought to be accurate. As for breaking our growth record, no one saw it coming. Last year, the experts forecast growth of 2%; it came in at 4%. A consensus of 50 top stock pickers pegged the NASDAQ to close a bit over 2K; it closed a bit over 4K. Their Dow guess was off by 2000 points. For year 2000, the experts say the good times will keep on rolling. (Daily Yomiri, Tokyo, 2000 Jan 1) Even if they don't enlighten, at least they entertain.

If not the media pundits, who is starting to see the light? In The Affluent Society (1987), Harvard's John Kenneth Galbraith: "… if a tax were imposed equal to the annual use value of real property ex its improvements, so that it would now have no net earnings and hence no capital value of its own - progress would be orderly and its fruits would be equitably shared".

Minnesota's Environmental Quality Board in its "Smart Signals: Economics for Lasting Progress" said the current property tax discourages urban redevelopment. The agency recommended increasing taxes on land values and decreasing taxes on buildings, thus lessening the penalties for structural improvements. (Tax News Update, Vol. 12, No. 12, Dec 21, www.sustainableeconomy.org)

The Sustainability Project, which, with members of parliament, is launching the "Canada Well-Being Measurement Act" early in February, is run by Mike Nickerson (Jan 10): "Writing (another book) will have to wait. The Georgian perspective will be included, without doubt. John Fisher (Ontario Green Party) has made a good case for Georgian taxes. I'm convinced."

Rachel's Environment & Health Weekly (#672, 99 Oct 14, Editor Peter Montague, www.rachel.org) praised Sustainable America's (www.sanetwork.org) organizer's tax kit. One chapter (which we edited) urges both the end of subsidies to sprawl (funds for new infrastructure from taxes on everyone rather than from fees paid by users) and the shift of the property tax from buildings to locations. Penalize land speculation and make buildings less costly to build, operate, buy, or rent, encouraging urban development. (Thanks to Alanna Hartzok for sending this issue of Rachel.)

The GEO (Grassroots Economic Organizing) Newsletter, a left green bimonthly from Pennsylvania ('99 Jan-Feb): "replace ineffective property taxes … tax land but not improvements and thereby penalize speculative land holdings …"

The Rocky Mtn Inst Newsletter ('99 Fall) edited by Dave Reed: "Closed-loop industrial systems would be more common in the United States if government subsidies didn't reward waste and maintain artificially low prices for virgin materials." This follows their latest book, Natural Capitalism, which touts part of the tax shift.

Richard Register, founder of Berkeley's Urban Ecology, , in e-mail Jan 15: "Geonomics is important as far as I'm concerned." British Columbian Walt Taylor in his An Action Plan for Survival of Life on Earth returns land to its relevant role in economic analysis, said reviewer Mary Rawson (Peace Lines, '99 Sep). SAL ('99/9/9) imagined a Rent Strike 2000: A Millennial Jubilee. If the Y2K bug had reset computers for 1900, then we'd owe the tiny rents and mortgages of a century ago. SAL envisioned citizens investing their savings in ways to help everyone.

American feudalism lasted until 1948. Then Mrs. Graham Allen of Sharpsburg, MD, the last person entitled to collect "quit rent", sold her right to collect rents from owners of land that her ancestors had sold two centuries earlier. (Origin of the Land Tenure System in the United States, Harris, Marshall, 1953) Well, that's progress, albeit belated. Paying rent to an individual, even a kind old lady, is wrong. But not paying any rent at all is not right, either. What's right is paying rent to one's neighbors. Rent is the flow of the value of the land which is generated by one's society. Rent is supposed to be shared equally among all residents of a community.

In The tragedy of the Commons, popularized by Garret Hardin's article in Science, the commons were, as the author acknowledged, purely hypothetical. In Common Property Economics (1991), British economist Glenn Stevenson compared real commons in Switzerland and in England, 220 pages of text, footnotes, charts, and formulae. It turns out both countries' commons are less used, and hence less productive and less abused, than private property. Residents claim the best sites for private use and share the worse sites (tho' there was not a whole lot of difference between them in small agrarian societies). On commons, local custom does a good job of keeping local users in line. The real tragedy (such as it is in Switzerland) takes place on private holdings, not common.

Owning your own basis for survival - today in the post-industrial era, we can not imagine the appeal. The Lure of the Land by Everett Dick (1970) tells the acts Americans committed to get and keep some. The widespread fervor to squeeze profit from soil became modern real estate business. Today's Sagebrush Rebellion is the latest wave of anti-government land-grabbing.

Thomas Jefferson, who doubled the size of the US, expected westward expansion to take 100 generations; it took five. Europeans marveled at Americans always on the move. When titles were hard to secure, poor farmers kept fleeing west, keeping ahead of dealers with deep pockets and shallow scruples. Early settlers would tell newcomers, unless fancy dressed, the whereabouts of the best unclaimed land. Speculators were in the same class with note-shavers and horse thieves.

While many paid the US (selling land was the government's biggest source of revenue), many others cheated. The US Government had no more luck with its settlers pushing west than a generation before did the British Crown have with Americans crossing the Appalachians. The Army, besides expelling Indians, was also called upon to expel squatters who invaded before Congress allowed it. Once land was opened, settlers formed clubs to rig auctions.

While defrauding the public did save some settlers money, it also cost them. The laxity allowed professional speculators to hold huge tracts out of use, depriving settlers of neighbors, of fellow taxpayers, of public services. The counties with the worst land monopolization still were the poorest in their state at the time of the book's publication.

Land lust abbreviated childhood. The Civil War robbed the cradle of boys, land grabbing robbed it of girls. When the law required claimants to be families, in Oregon marriage under age 15 was the rule for girls. One couple had to hold up consummation until the bride graduated from elementary school.

Not just otherwise honest settlers but also speculators, hoarders, lawyers, surveyors with elastic chains or who worked from moving trains, and government agents who "inspected" claims from the comfort of their office defrauded the public of millions. To testify truthfully that they had erected lodging, the more scrupulous speculators would park a wagon with a tiny home on their claim for a few nights. Others simply perjured themselves. To testify some land was a swamp for extra subsidy, the reliable wagon would reappear with a boat on it. Contest sharks, a species of attorney, made fortunes challenging everyone's title. After a while, if he didn't move on, tar and feathers hurried him on his way.

Honest agents were threatened, sometimes beaten, occasionally killed. Survivors either bent to the frontier mentality or quit after a few frustrating years. Dishonest agents announced auctions with not enough lead time for people living out in the country but convenient for in-town speculators. An agent on the take told land cruisers that the land they wanted had already been claimed, giving his cronies time to buy the desired spot.

The founder of the Union Pacific, Grenville Dodge, began as a speculator. The railroads got 155 million acres which the Supreme Court ruled was tax-exempt. Logging land was under-taxed as timber men controlled local governments. Congress gave states 13 million acres to sell for acquiring college campuses. Since this generous act stymied competition, one speculator, Gleason Lewis, ended up with five of the 13 million acres.

When caught, the guilty person or lawyer or railroad or timber baron was rarely punished, shielded by sheriffs, judges, and congressman. Judges fined violators five cents for thefts that netted hundreds of thousands; one miscreant reaped $200,000 a year. In 1906, Oregon had two Senators and two Representatives. Three of them were indicted (the fourth escaped on a technicality). Two of the indicted served time. The third also got off. Attorney generals often worded charges to make finding escape clauses easy.

Competition was fierce: first comers vs later arrivals, prospectors vs irrigators, cattlemen vs sheep herders. Disputes were settled by bluff and violence. Having chosen a spot, whether land granted for military service (modern GI bills continue the tradition) or not, Civil War veterans were hard to dislodge. In California, battles between squatters in San Francisco and in Sacramento ended with fatalities. In Sacramento, the leader of the losers was thrown in jail from where he won a seat in Congress.

Disputes were also settled by consensus. Once, two heavily armed sides reached a peaceful accord after one man was accidentally shot. Another was settled by hiring independent counsels whose verdict was accepted graciously by the losers. As towns and valleys filled in and competing, odd-shaped parcels needed to be realigned, neighbors - without lawyers - gave and took in cooperative spirit. Fashioning their own justice built community; many frontier agreements later were codified into law, even if state law contravened federal.

The lure of "free" land, reinforced by false ads circulating back East and in Europe, attracted people unprepared to farm, to outlast droughts, pests, sand, and blizzards. Broke, farmers had to borrow at 50% interest. Some mortgaged to the hilt and fled. Women led an exodus that depopulated the Great Plains in the 1890s, ironically when famous historian Turner called the frontier closed. Yet more land was claimed in the 30 years afterward than the 30 years before. Actual closure came at the end of 1934 when FDR signed an Executive Order to hold onto the last public land left.

As the supply dwindled, a few scrupulous officials did stem the tide. Under Teddy Roosevelt, Commissioner Sparks, Secretary of the Interior Ed Hitchcock, and first Chief Forester Gifford Pinchot did suppress fraud by half for a few years. Their cases were refused by the Supreme Court since one guilty ruling could set off enough litigation to throw the entire West into turmoil. Bill Kreutzer, the first forest ranger in Colorado, unarmed faced down timber poachers. With words alone, he disarmed them and persuaded them to obey the law.

In a nation founded on speculation, on displacing its original inhabitants, not "paying tribute to Caesar" felt perfectly acceptable. The only thing that might have prevented such massive fraud may have been a land dividend, sharing the proceeds from selling western land with all citizens. Then to fund itself, the early US would have had to also levy private land back East, balancing the burden on settlers out west. Getting back a fair share of the socially-generated value of land might have instilled a land ethic that would have made the lives of the rugged yet poor settlers easier and the land herself less despoiled.

Andy Kerr, the Larch Company and Alternatives to Growth Oregon, Mike Nickerson, the Sustainability Project, Dave Reed, Rocky Mountain Institute, and Miguel A. Rementeria, CIMA, Secretary of the Forum of Buenos Aires, Argentina, all requested an article explaining the essence of geonomics clearly and succinctly. Dave adds, "Your newsletter is intriguing, but without this sort of basic intro, it's hard for newcomers like me to make sense of it." Mike adds, "If someone were able to put it clearly before the public, the educational process would itself further ripen the possibilities."

Try this. Rank the 50 states by economic health. Now rank them by how much rent their property tax gets. Hm, interesting. Same list! How's that possible? Getting rent decreases speculation; so owners invest. It can displace taxes on production; so companies produce. So, to shape up economies and heal eco-systems, how do we persuade localities, states, and nations to get more rent via their property tax or user fees? As Buddha might say, don't make it happen but let it happen. Forget getting the rent. Focus on sharing it. Propose a citizens dividend or housing voucher. As a mere addendum, explain it'd be funded from site values, and those would be collected via user fees, while taxes on sales and income would fall. Does that help? For an in-depth answer, check out our lit list.

Medical care costs an arm and a leg (the two good ones). Insurance plans - public or private - treat this symptom, high cost, not its cause. Why do millions of us need relief from doctor bills? Anytime price seems out of whack, check what exacerbates demand (e.g., unhealthy lifestyles, an aging population) and what inhibits supply. One inhibitor is the AMA or the medical monopoly, legalized by the state-granted medical license.

The licensing requirement stifles competition by preventing nurses from handling minor cases, by revoking the license of doctors who try tradition or innovation in lieu of convention, by even arresting popular practitioners, as chiropractors were not so long ago.

What if government charged full market value for its licenses? Or better yet, quit licensing altogether, and instead required bonds, insurance, and truth in advertising? Soon competition would spur doctors to advertise their prices and their won-lost records. More medical schools would open. More medical methods would be taught. The doctor/patient ratio would improve. And costs would plummet.

To make medicines affordable, too, try charging full market value for patents. Then companies could not afford to hoard promising ideas. Spinning them off would spur competition, lowering price. Why should anyone get rich off of disease? If doctors and pharmaceuticals ever realized their purpose - cure disease - they'd work themselves out of a job anyway, right? Charging what licenses and patents are worth merely hastens them toward this lofty goal.

Last quarter we worked far harder abroad than here at home. For three weeks in Taiwan, we presented geonomics to a half dozen legislators, even more top officials, three advisors to the leading presidential candidate, two press conferences, all top economists, earned honoraria at all major universities and organizations, and catalyzed activist groups who'll keep pushing geonomics. Thanks to the Robert Schalkenbach Foundation, Common Ground - USA, Common Ground - LA, and the Henry George School of New York for making this trip possible. For a full report on the island's political and environmental situation, see our website.

At the Smart Growth Conference in San Diego in November, all of our 100s of pieces of table top literature was gobbled up by the 100s in attendance. We got in a few words with a couple presenters. Maryland Governor Parris Glendening and national columnist Neal Peirce. Both replied they intended to highlight the property tax shift. Thanks to both DC's Urban Land Institute, San Diego's Foundation for Economic Justice, and SD host Alan Ridley for making our attendance possible.

Sustainability Review (#11, Jan 24), circ. over 2400 in 59 countries, www.eeeee.net, ran our comment: Mike Nickerson wrote, 'it is well known that when something is taxed, we get less of it.' Well known, yet false. Has anyone ever seen land shrivel away when taxed? Never. What is reduced is waste of land. Taxing land value does not reduce land, not even usage of land. It just spurs owners to use land most efficiently, meaning we can get more output from fewer sites and resources. That - more from less - and only that, is the basis for a sustainable economy, eco-system, and civilization. Hanno T. Beck, web master (Dec 2): "You're the headline man at The Progress Report again today. Your Sustainability Review article ('Plugging the Leaks in Local Economies") is featured there and added to the Geonomy Society web site." Also, it's posted at the Henry George Foundation site and reprinted in Australia's Progress journal (Jan/Feb). Our report on our fall trip to Mexico appeared in Groundswell ('99, Sep/Oct). One spin-off from that presentation to the plenary of the Green Millennium Conference was the invitation to Taiwan. Another is on-going e-xchanges with Mexican Green Party activists and Argentinian environmentalists (above).

Bruce Harder, Finance Director for Tri-Met (Portland's regional transit agency), requested a packet of documents we were eventually able to dredge up. Now that we know where to find them - "Values Higher Near Rail Station" by Chuck Metalitz, former Chicago planner, in The Illinois Georgist (1997 Fall/Winter); "Transit-Induced Land Values" re Washington, DC by Walt Rybeck; "The Pittsburgh Experience" by Oates & Schwab of the U of Maryland, "Growth and Its Impacts in Oregon" by the Governor's Task Force; long bibliography by transit spec. Mary Rawson; and recent bibliography by planner Tom Gihring - any other takers?

Ed Clarke, Ph.D. Chicago, economist in the Executive Branch in Washington, DC: "I need a care package of materials I can refer (ivy league cohorts) to. What is the best set (references), drawn mostly from your (and Dr. Nic Tideman's) work, for audiences (often single individuals) of this type? Gather some of your latest materials and do a special, short 20 p Primer for Academics/Policy Professionals. Nic's "The Shape of A World Inspired By Henry George" is a particularly good summary of the geonomic principles involving intergenerational equity, pp 7-9, Sec VI, "Resources That Fluctuate Over Time". www.econ.vt.edu/tideman/sshg.pdf Like the stuff I put up on the Global Public Goods page. www.geocities.com/flower1_20007/pubgoodsapps.html
Ed, maybe they'd like our fat report ordered by Dr. Mason Gaffney (UCR) and recommended by Alanna Hortzok? See below, "Newals, Renewals, & Orders.
Jim Mann, listed in Who's Who and author of Tomorrow's Global Community (1998), invited your editor to join his Virtual Panel on 21st Century Social Evolution with 34 others, most from sociology departments of American universities. "I shall definitely put a link to your website. I hope you will do the same for us." Of course. Alanna Hartzok, the activist who won local tax option for Pennsylvania boroughs, appointed your editor to her Panel of International Land Rent Consultants along with people who really do deserve to be there.

Sonoma County Independent (Jan 13-19), Letters to the Editor: I'm glad you are doing a series on affordable housing. But you are wasting your breath. As long as property owners can keep the unearned increase in the value of land, the problem will never be solved. This is the sacred and untouchable flaw in capitalism. Every great economist in history (including Adam Smith) said land value is created by the community and belongs to the community through the collection of Land Rent. But who wants to listen to a bunch of dead economists, when there is easy money to be made?

This brings us to another fatal myth of capitalism, full employment. There may be 5% or even 2% "official" unemployment right now. But in some communities it is still much higher. This is the best economy ever in US history. If we don't have full employment now we never will. So the fact is we never will. How do we provide for everyone from the great wealth of our society? Maybe it's time to resurrect the recurring idea of a basic unconditional income paid to everyone. No means testing, no welfare trap, no stigma. If you work you don't lose it. Everyone gets it.

How to fund it? From the tremendous value of land rent available. Private property titles are sacred, but the economic value of land belongs to the people of the community that created it. Charge a 10% land value tax and distribute it as a cash dividend to everyone. Thomas Paine proposed this 200 years ago in Agrarian Justice. Anyone listening yet? Sincerely, Gary Flo, VP, Institute for Geonomics

Dr. Russ Beaton, Willamette U (Dec): "Thanks for some real interesting stuff. I love the very open think-about-this-&-do-with-it-as-you-like attitude." Now there's two of us. Yet how else to deal with the superstitions abounding about how economies work and don't?

John Burger, retired Minnesota lawmaker (Nov): "Thanks for your good work." Welcome, but I got a ways to go before I catch up to those who've done it for eons.

Dr. Jim Busey, retired Colorado prof (Jan): "Marian and I have both read your Geonomist from cover to cover, and are astounded at your multinumerous activities. Enclosed are $24; by not sending $25, we can avoid receiving the slogan button, discounts, and right to vote. You're doing fine without having us tell you what to do." Gosh, people think we'd listen? But big thanks. We've gotten low on buttons.

Dr. Polly Cleveland, Bard College (Jan): "Nice job on your last issue! Please send a copy to my niece; wants to be an environmentalist." Once she reads this, what better way to go green than to go geo?

Wendell Fitzgerald, San Francisco (Jan): "Congratulations on the nice work you are doing in Taiwan. Your web site is lovely." Thanks. Hanno Beck gets the credit for the site and the Green Party of Taiwan for Taiwan. I just catalyze when I'm lucky.

Shirley-Anne Hardy, Scotland (Nov) to Scotch environmentalists: "As one who has spent incalculable time and energies (and funds) in on-going struggles over three decades now, to me it is dishonest to go for short-term measures that cannot ultimately solve a problem, whilst ignoring longer-term measures that hold the full solution - land rent for revenue." Hear, hear!

Dr. Lowell Harriss, emeritus and Geonomy Society Advisor (Dec), sent clipped cartoons with: "Last summer, the first holder of the Lowell Harriss Professorship in Economics at Columbia was announced - Robert Mundell. He has just been awarded the Nobel Prize in Economics: it is a privilege to join in justified applause." Wow! The sound of one jaw dropping.

Alanna Hartzok, a UN NGO Rep and world traveler who appeared in London's Land & Liberty magazine this winter and who actually got a good bill passed in her PA (Jan): "Great job on The Geonomist which I read with much interest and yellow highlighter. Can you send and bill me for the prize-winning Redefining Progress report? Thanks." Done and done. Anyone else?

Meta Heller, widow of Carl, creator of the birth control pill, (Jan), sent a clipping from The Seattle Times which reported her candidacy for the Democratic nomination for governor of Washington. She noted she has a treasurer and a treasury. Now all she needs is treasure! (360) 352-9507.

Bryan Kavanagh, Australia (Dec): "Another newsy issue in punchy Jeffspeak! Do you receive a copy of "Progress"? If not, hows about we swap journals, 'cos the forex cost on subscriptions gets a bit out of hand at this end? What say you? PS: 'Domus ex vectigal'?" Yeah, after "deus ex macina". And sure, let's swap.

Lydia Kirsch, Tax Reform Australia (Jan): "Can we please have your permission to use some of The Geonomist articles in Progress? Should you wish to use any of our articles, please do." Looks like we got a deal.

John A. Morales, Missouri retiree (Jan): "Keep up the fabulous good work of collaborating with greens and anybody or group that will listen. Enclosed $25 rejoins me to your Society as a supporter." Welcome back, Johnny. We missed ye.

Bill Pitt, "Uncle Scrooge MacBill" Australian (Dec): Thanks for latest. I left a few dollars for such things with (Yank) Ken Wenzer, so will ask him to mail you 20." Ken who? Twenty what? Haven't heard a peep from him.

John Stein, Ph.D., investment consultant and cover boy (Jan): "Hello. Keep up the good work." And you keep riding the market. We got a deal?

For ordering literature, thanks to Mel Leasure of Virginia's intentional community, Common Ground (Jan); he received: "Test Your GQ (Geonomics Quotient), a Quiz of 100 questions with startling answers" and "Suburbonomics" with aerial photo in color and "Plugging the Leaks in Local Economies" and "Why Tax Land". Thanks to Alanna Hartzok; after receiving "Giving Life to the Property tax Shift", without even requesting a commission, she told her e-list (Jan): "I just read Jeff Smith's and Kris Nelson's scoping paper for Redefining Progress. It is quite excellent, a terrific historical overview, current analysis of immediate challenges, and future prospectus for the movement to secure the human right to the planet for all. To Jeff and Kris, Bravo! To others - you may want to ask him to send you a copy and pay him ten bucks for his trouble." Dr. Mason Gaffney (UC-Riverside) wrote (Jan) "OK, with support like this, it must be worth seeing, so please send copy to me." It's sent. Was it worth the read?

Other favorites: "Greens on George: 99 Notables view taxing land alone", "101 Famous Thinkers on Owning Earth", "Where Tax Reform Has Worked: 20 Case Summaries", "America's Most Famous Forgotten Man", "War No More", "How Profit Shapes Urban Space", etc. For a list of 50 items, just ask. Prices range from a buck to $2.50.

For joining and rejoining, thanks to Dr. Russ Beaton (above), Dr. Jim Busey (above), Dr. Polly Cleveland (above), Chuck Fall (Oregon Green Party), Everett Gross (retired Nebraskan farmer and sustainer!), Meta Heller (above), Jake Himmelstein (Pennsylvania accountant and stalwart!), Mel Leasure (above; a double stalwart!!), John Morales (above), Bill Pitt (above), and John Stein, Ph.D. (above). You guys are great! We're 32 over a hundred and, with your help, still growing!

For hiring our services, thanks to Mike Schend of the Hood River County School District and to Bruce Harder of Portland's Tri-Met (above). Need an answer, slide show, new data, or projection, employee us!

For funding our work big time, major thanks to the Local Government Commission (Sacramento) and the Foundation for Economic Justice (San Diego) for sending us to the Smart Growth Conference (above) and to Common Ground USA, Common Ground LA, the Schalkenbach Foundation, and the Henry George School of New York for sending us to Taiwan (above) and bringing us back. May others well endowed mimic your wisdom and generosity.

Donors willing, next quarter we'll present geonomics at three conferences of Ecological Economists. The European branch meets in Austria in May, the North American branch meets in Canada in June, and the international tree meets in Australia in July. All asked for papers which will be posted on their w-sites. The Aussies asked for a talk, the other two for poster presentations. It's environmental academics and activists who are most receptive to geonomics and promoting the shift of taxes and subsidies in the mainstream.

Dr. Nicolaus Tideman of Virginia Tech, an expert in financing society from socially-generated values (what could be fairer), is coming to Portland for March 5, 6, 7, and 8 for some meetings and to do some research on local land values. Dr. Tideman did time at Chicago, Harvard, on a Presidential Commission, and is well known for his scholarly publications. Want Nic to talk to your class or staff or meeting? Just give us a call.

Think about adding your name to a petition for sharing Earth by sharing her worth. It's to be presented to the UN General Assembly and the Millennium Forum. You'll be invited to help secure this basic right. For the full text of the petition, contact Alanna Hartzok, an NGO representative to the UN. She's at < earthrts@pa.net> and a delight to deal with.

Join! Sign up others! Persuade foundations to support us. Come to a meeting. Organize meetings, lobbying, letter-writing campaigns to editors and elected officials. Invite us out to present our show. Then in your spare time, learn to wrestle and get elected governor.

Help build a bandwagon and climb on board. Remember. It is on the wings of donations that awareness spreads. And the sooner the word gets out, the sooner the world gets well. Thanks.

THE GEONOMIST

Vol. 8, No. 2
Editor: Jeffery J. Smith

THE GEONOMIST

Vol. 8, No. 2 Editor: Jeffery J. Smith

Vol. 8, No. 2
Editor: Jeffery J. Smith