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Land is Free
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SA8. What is the Answer by John Stewart

By John Stewart – When you consider it, we all have an ideological mind-set of some sort, but unlike our elected leaders, we’re not in a position to impose it on the wider public; which is probably their good fortune – and ours! In the real world, as they say, we’ve had a Labour ideology for the past twelPandora Charms Sale ve years and if the general opinion is correct, a Conservative ideology is about to come to power. If so, how much wilI change, or perhaps, how much can change?

Over the years we’ve created a huge culture of dependency and welfare, no doubt for the best of reasons. The cost of mitigating poverty is enormous, yet this does not seem to cure the problem. Indeed experts tell us that the gap that separates the rich and poor is wider. And in the middle the middle class is squeezed until the ‘pips squeek.’ Huge amounts are spent on health and education, but equally huge problems remain. With this situation, can we say that government intervention works? On the othCheap Pandora Beads UK aer hand, we can’t abandon the unfortunate in society to their fate! What is the answer? What should a new administration do? What can they do?

Our democratic system holds elections every five years, or thereabouts. Votes are canvassed with a view to capturing the maximum support. This, one might say, satisfies the maxim: ‘the greatest happiness for the greatest number,’ for that is where the votes are. Politicians must not offend the self­interest of the majority and this includes the property owning middle class. Indeed any hint of this would be an instant weapon for the opposition’s armoury. So elections are something akin to a tax auction; the same old auction that’s gone on for decades.

Radical reform: that is, tackling root causes is avoided, as it offends the self-interest of the greatest number, the provider of the votes. You might say that the electorate is the author of its own misfortune, or fortune, if you happen to be on the right side of the-have-have-not divide.

Real-estate law allows the location value that attaches to land to be claimed privately. However location value is the creation of the community as a whole. No one would claim that the location value of the local high street, or say the City of London is the creation of an individual or even a corporate body. Yet this community created fund is claimed privately. This, of course, is perfectly legal. Also legal is the taxation of enterprise in the form of earnings. So the state taxes privately created earnings and leaves publicly created location value to be claimed privately. This seemingly illogical practice has held sway for centuries.

To own the publicly created location value of, say, a Threadneedle Street site, would be quite a nest egg. Indeed, tapping the community fund is lucrative. This, of course, is the general situation for those who own their property and its site location. Again, as already mentioned, it’s all perfectly legal. Clearly, those who own property in a desirable area are well placed. High street landlords extract large sums per month from their tenants. Charging for the building is quite reasonable, but this is often small compared with the site location value, which in some cases can be very considerable. What high street tenant doesn’t complain about the rent? For in almost all cases the landlord will take the most that he or she can get. So the ownership of real estate, that is capitalized location value, can command a substantial advantage, which ‘of course’ is fme for the landlord, but not so fine for the frequently struggling tenant.

Whether domestic or commercial, not all, of course, own real estate and those who don’t are at a considerable disadvantage, as they have to find rented accommodation or state sponsored help. Here is the beginning of the have-have-not divide.

So, what is the answer? Well ‘dear reader’ – if I may slip into Trollope mode! – This is where the baton passes to you! We may rage agairist the Left of castigate the Right and end up with a patched up model of the status quo. Here, nothing much will change, except that hard extremist versions of the Left and Right could do great damage. We could, of course, investigate the communal fund that rises in a natural way within communities. Three questions may help this enquiry. What is location value? Who creates it? And to whom does it belong?


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