Category: Georgist/geoist

Henry George's remedy for AIDS

No, Henry George didn’t say anything about AIDS,  but…

While safe-sex education has changed sexual behavior in the United States, it’s had little effect in Africa, which [UC Research Associate Emily] Oster ascribes to quality-of-life differences. “How much people care about dying from AIDS 10 years from now depends on how many years they expect to live today and how enjoyable they expect those future years to be,” Oster wrote. “If income and life expectancy in Africa were the same as they are in the United States, we would see the same change in sexual behavior—and the AIDS epidemic would begin to slow.” 

Achieving prosperity and improving the quality of life– that Georgists know how to do.

Source:  Chicago GSB Magazine 

Intro courses found ineffective at teaching economics

Introductory economics courses effectively teach nothing, according to Robert Frank.

Students are given tests six months after they’ve taken the course to see whether they understand basic economic concepts, and students who’ve taken the course don’t score any better on those tests than students who didn’t take the course at all.

His solution involves teaching only a few basic essentials, and emphasizing stories as a way to learn. What it means for the Henry George Schools, I think, is that we probably are more effective than academic economists, and that there was a reason why HG put all those digressions into his books.

Vicky grows and changes

She’s no longer a lab/setter mix,Vicki or Vicky or Vickie apparently, but either a harrier or a treeing walker. Or some mix of one or the other. Too late to change her name to Harry or Walker.

Update May 30: I have no idea why the image above shows only the rear 30% of the dog. If you click it, and click it again, you’ll get the proper picture.  (Update June 3:  It took two clicks using Firefox under XP.  Opera under Mepis requires only one click.  So I really have no idea what clicks anyone else would need.)

Pre-emptive Capital

When I first saw the phrase “pre-emptive capital,” I thought it was some sort of Marxist concept, but actually it seems to originate, at least in its politico-economic sense, with Mason Gaffney’s effort to bring Henry George’s ideas into the modern age.  Pre-emptive capital “serves its owner to preempt common lands. An example is a large, fast, noisy, dangerous, polluting motorboat on a small lake. ” Automobiles, of course, are another example, and Gaffney sees taxing of pre-emptive capital as a way to charge for the pre-emption of commons that such capital enables.

It seems to me that, if we can, we should tax the pre-emptive use rather than the equipment that enables it, but the latter may often be more practical.  And I don’t see that it has to be limited to capital, but could be any kind of wealth.  My use of the commons is lessened by all the cigarette fumes I encounter walking the downtown sidewalks,  but maybe the smokers are paying for this as part of the incredible tax rates imposed on their fuel.

As always, Gaffney’s entire paper is well worth reading, though much of it is a critique of modern Georgists rather than HG, and of the rest much is already standard in our HGS courses.

It is difficult to tax only the rich…

…because to a large extent they can pass the taxes on. After all, they are rich because they have some sort of market power, something somebody needs. If we increase the cost of providing whatever it is that rich people provide, they will just charge more for it.

Today’s example involves overpaid corporate executives. They get various perks, such as country club memberships or free use of company airplanes by their spouses. They also get extra-generous severance agreements. Congress has passed special taxes on these things. Do corporate executives pay them? No, most companies make additional payments to cover the taxes, and further additional payments to cover the taxes on the additional payments.

Note these executives and corporations aren’t taking advantage of any special loopholes here.

Source: “Rules shine light on ‘gross-up’ gravy train” Chicago Tribune, May 2 2007. If the Tribune puts this AP article behind a paid archive screen in a few days, versions might still be here or here . Earlier, a similar article appeared here , and some time ago here.

Of course there is a tax that mainly hits the rich, and cannot be passed on.

Henry George's proposal in action

Today’s Tribune gives us another example of the community collecting the rent: Chicago Park District harbors.

For many years, boat slips were greatly underpriced, so in order to get one you had to bribe a Park District employee. In 1996, harbor management was contracted out to Westrec Marina Management. Rates were raised and continue to increase. Harbors were improved and the number of spaces increased from 4400 to 5100.

A slip for your 35-foot boat at the popular northside harbors will cost you $3418 if you’re a Chicago resident, with a 25% surcharge for nonresidents. Fees are expected to yield $20.4 million in 2007, against $7.3 million operating costs. Of course there are also capital expenses, but the balance goes into the Park District’s general fund (although part of the cost is municipal tax which presumably goes to the City).

Of course there are people complaining about the cost: “It saddens me to see these prices get to the point where some people have to reconsider whether they can afford to do it anymore. With the way the economy’s going, fewer people will be able to get into boating in the first place,” says one boater.

You will always get people complaining, on behalf of the poor, that their costs should be reduced. It is obvious that boaters are not poor people. If you don’t want to pay to keep your boat in Chicago, there are less expensive harbors at Waukegan, Winthrop Harbor, Michigan City, and elsewhere. There are cans and star docks (which I guess require one to row out to one’s yacht) for as little as $1200/year.

Henry George’s proposal is really this simple.  The community makes land valuable.  That value belongs to the community, who should collect it in the form of a periodic payment for the exclusive right to use a piece of it.  Even when the land is water.

Vicki!

vicky_sits.jpgInterrupting the serious blogging to note a new puppy in the house, Vicky. She’s ten weeks old, allegedly a mix of Gordon Setter and Lab, quickly learning to be spoiled, but most importantly, made it thru last night without peeing on the floor.

Let’s assume she’s a Georgist, so I’ll categorise this item thus.

Illinois farmland prices continue to rise

Our friends at the Illinois Society of Professional Farm Managers and Rural Appraisers have issued their 2007 report.  Basically, farmland prices continue to rise into the first quarter of this year.  Although 1031 exchanges are still a factor,  the greater part of the increase seems to be due to increasing yields of crops selling at higher prices (ethanol subsidies being part of the reason).  Coal mining also seems to be a factor, I guess because landowners can expect to sell rights, or the land itself.   And wind turbines, which as I understand it yield far more than field crops.

Prime quality farmland is selling at $5,000 to $6,000 per acre outside of metropolitan areas, and up to $30,000 on the suburban fringe.  “Recreational” (hunting) land goes for less (this being land not terribly good for farming).

The report points out that 55% of American farmland is owned by people who do not farm it, and “that number is growing.” If I were inclined to join them, I would be concerned by the report’s assertion that “Farmland is a growth stock,” with a graph very reminiscent of a stock chart, showing that farmland values fluctuate, but the long-term trend is sharply up.

There’s lots more and the report is well worth a look by those interested in where our food comes from and what it costs to produce.