Welcome to The Leftist Review

Please join our discussion community.

You must log in to your account to leave comments. If you do not have an account, simply register and begin posting comments on articles now. To register, you will need to create a user name and provide a valid email address. Your privacy is guaranteed--your email and information will never be shared. Your password will be sent to your registered email. Thank you!

Member Login
Lost your password?
Not a member yet? Sign Up!

Core Values for a New Economy: First is Equality

March 29, 2014
By

And no one pours new wine into old wineskins. Otherwise, the wine will burst the skins, and both the wine and the wineskins will be ruined. No, they pour new wine into new wineskins.”

— New Testament, Mark 2:22, New International Version

 

We hold these truths to be self-evident: That all men are created equal…

– United States Declaration of Independence, 1776.

 

All the things that humans create in the world, from hammers and nails to spaceships, first began as ideas in the human mind. Economic systems are human creations. There is no invisible hand. Every economic system, both past and present, has reflected its society’s values on everything from the meaning and value of work, to the relative importance of competition and cooperation, to the inherent worth of human beings, both as individuals and as a species.

In order to replace the current money-jobs systems, whether called capitalist or socialist, with systems that will be more just, peaceful, universally prosperous, and ecologically sustainable, we must first look at what values we will need to adopt globally in order to allow such a change to take root. As the New Testament says, you can’t put new wine into old wineskins.

From among the various possibilities currently being discussed for reforming economic systems, I prefer what people variously call demonetization, non-monetary economics, non-market socialism, de-growth solidarity, gift economy, or a variety of other names that denote the abolition of money-based exchange, and jobs as a way to ration the money used to purchase required resources. Under demonetization, meeting the needs of people and the ecosystems in which they live replace today’s obsession with commodifying everything, everyone, and every relationship in the names of progress, growth, and, of course, profit.

Dr. Anitra Nelson, coeditor of the book Life without Money, prefers the phrase non-market socialism, and defines a society run by this form of economics as a “money-free, state-free, class-free society where people’s needs are still met. And they’re met by people sharing in decision-making and sharing and doing all of the work of production and exchange.” In order for us to achieve such a society, we must free ourselves from current “values”, including the need to compete against each other for survival, the need to justify our existence, and the need to be of profit to someone else as the prime condition for meeting our own needs.

In order to truly revolutionize our systems of producing goods and services, and distribute the resources of the community fairly, we must, first and foremost, recognize the equality of all people.

For me, the keystone of pro-demonetization values was most eloquently expressed in the U.S. Declaration of Independence: “We hold these truths to be self-evident: that all men are created equal…”. Somehow, people often miss the self-evident nature of human equality. This applies even to the author of these words, Thomas Jefferson, who was himself a slaveholder.

We understand that the Founders’ definition of men meant propertied white males. All women, all people of color, and poor, propertyless white men were not included in their meaning of equality. The Declaration of Independence was addressed to British King, George III, by white men in the colonies who were aristocrats, even though they held no titles as such.

Contrary to what Justice Antonin Scalia might think, we are not circumscribed by the Founders’ limited understanding of what they wrote. We can do better. Today, more people recognize a generalized, baseline humanity, irrespective of color, gender, or socioeconomic status. This broadened understanding is part of the maturation of a civilization.

Furthermore, we have empirical evidence of human equality. Strip away the superficial differences many people deem important: variables such as gender, height, weight, skin color, IQ, physical strength, and social differences such as ethnicity, citizenship, religion, or class, and certain fundamental truths about human beings emerge.

Firstly, we all come to earth from the same source. It is immaterial whether you believe in a personal Creator, as the Founders did, or believe in the impersonal processes of biology, chemistry, and physics, or are agnostic on the issue of what the ultimate source is. The woman’s womb is the physical source upon which we all can agree, even as we debate the metaphysical sources; all human beings are born via the body of a woman, whether a child began in a petri dish through in vitro fertilization or was conceived in the more conventional way.

Secondly, we are all born naked and helpless, with basic biological survival needs; we need gifts to survive. Although the amount of resources we require to meet our survival needs vary according to our individual biology, our culture, and even our climate, we all need food, clothing, shelter and healthcare. In youth, these are freely given to us by caretakers. For example, none of us, even if we were born into wealthy families, paid for mother’s milk (or a bottle) by whipping currency out of our diapers to engage in a commercial transaction. If people would simply stop to think about that fact, they would realize that the gift economy that they would write off as hopelessly Utopian, exists now for all of us. You have no children? Then consider the fact that trees make oxygen for us without sending a squirrel to our homes monthly with a bill in its mouth for oxygen services rendered.

Thirdly, all of us go through a basic maturation process: crawl before we walk, walk before we run, learn ABC and 1 2 3 before we read Shakespeare and spreadsheets. That there are individual variations in this arc, due to diseases, accidents, warfare, or starvation, does not negate the existence of the basic arc of development. Similar arcs describe the lives of all other animals and plants albeit with different time frames. It is the way of life on earth, and no amount of money can override this basic fact.

Lastly, and perhaps most importantly, we are all mortal. And when you die, you can’t take it with you. Thus, one can say that death is the great equalizer. But we need not wait until actual death to be equal. It is better to say that mortality is the great equalizer. Since we are all born mortal, and we remain mortal, we are all born equal, and we remain equal. Our social or economic differences during the course of life do not erase this equality. In the end, he who dies with the most toys still dies.

Once you accept the premise of human equality as a basic value, you easily understand how a money-jobs economic system violates this value. The money-jobs system is premised on our superficial inequality. Our fundamental equality means that no one has a greater right to the resources of this planet than anyone else, and no one has the right to withhold those resources from an equal as “unearned” or “undeserved.” You and I have as much right to food, clothing, shelter, and health care, as well as the social resources that allow us to be culturally engaged human beings, as the Pope, the President of the United States, the Queen of England, or the Koch Brothers.

Likewise, now that Fred Phelps has passed, Rep. Paul Ryan moves up my list of most despicable people on earth. But, I acknowledge that neither I nor anyone else can claim the right to deprive him of the basic resources of life, nor can we require that he become profitable to another in order to live decently. I believe he has to justify his actions, such as putting forth the horrible “Ryan budget”, which would only be useful if it were shredded and used as mulch. But he never has to justify his existence. None of us do. Either we were put here deliberately by an anthropomorphic creator God/dess, or we are the accidental byproducts of the co-mingling of impersonal forces. Who among us has the gall to argue with a creator deity that others of us should not exist? And who among us are foolish enough to argue with impersonal forces about the merits of certain accidents?

Some people lead extraordinary lives for good or ill. But their actions do not alter their fundamental equality with the most ordinary and anonymous among us. Though our deeds may be exceptional, our existences, as individuals and as nations, are not. It is exceedingly difficult for most of us to accept the fact that none of us, individually or collectively, can rightfully claim the power of life and death over our equals. But the sooner we realize this, the sooner we will get rid of wretched economic systems wherein the few determine the quality of life of the many, and in which both the few and the many think this course of events is the working of God or luck or Nature before which we are powerless. These evils were not imposed upon us. They, no less than hammers, nails and spaceships, are products of the human mind.

 

Kéllia Ramares-Watson is an independent journalist in the San Francisco Bay Area of California, who asks, “Why must we pay to live on the planet we’re born on?” She is ctive on an international email discussion list in support of demonetization. Kéllia can be reached at theendofmoney[at]gmail.com.

Share

4 Responses to Core Values for a New Economy: First is Equality

  1. Kellia on April 7, 2014 at 9:27 pm

    Equality of what? Did you miss all I wrote about fundamental human equality. We all are born from a woman, we all develop and grow in a certain arc, and we are all mortal. That is what I mean about equality.

    What do you mean about equal opportunity to earn a living? I don’t believe that anyone should have to EARN a living. No one has the right to tell someone else that he or she must be profitable to someone else in order to live. Contrary to the right-wing propaganda, the world isn’t made up of makers and moochers. The overwhelming majority of us want to do something with our lives. But that doesn’t mean we should be forced into taking what someone else wants us to do so that we can survive. We all have different work that speaks to us, tat we were born to do. We do not need to earn a living. We are already living.

    We should all be free to do what we want, to make mistakes, to take a long time doing one thing, to make goods and services people are free to reject and to not work at all sometimes without being afraid of poverty.

    You are right in that everyone cannot do the same thing equally well. But there are lots of things to do. The problem is what happens if you or what you do is unwanted? Should your equals be able to deny you resources because your work is unwanted or unneeded? Should you be forced to do what you don’t want to do because that is what will earn a living? Isn’t that slavery?

    Money is a source of control. I would like to remove that control from our lives. No economic system will allow for everyone to be employed in the long run, and even if one did, eventually people would not need certain things resulting in layoffs, or we will run out of natural resources in making things so that people have jobs and money to spend. That is happening already.

  2. Kellia on April 7, 2014 at 8:45 pm

    I did not at all address the land value question so I don’t understand why you brought this up. But there can never be equal access to land value because land itself of is of unequal value. Some of it is arable, some of it is not. Some of it is by waters that are teeming with fish. Some of it near no surface water source. Some of it has timber. Some of it is a grassy plain suitable for pasture. Some if it has a large city built over it etc.

    The ownership of land is a major problem. We should consider abolishing that as well. Many Native Americans did not believe in exclusive land ownership. When they first “sold” land to whites, they thought they were selling a non- exclusive right to use the land and were shocked when the whites got angry if the natives came back to hunt or fish on the land as usual. Even today, in parts of Africa, land titles are a fairly new phenomenon (as is land speculation).

  3. Macrocompassion on April 6, 2014 at 10:28 am

    The answer to this problem of speculation in land values was proposed in 1879 by Henry George. He proposed to tax land values and to eliminate all other kinds of taxation, which were anti-productive since they applied directly or less directly to the production process. They are 14 aspects of land value taxation (LVT), see below. First consider:

    Why Tax Land Values? – The Theory of Land Value

    As a new community grows from a few pioneers, the use of land and other natural resources is limited by the territorial claims of its occupants as well as the poor means for access to its bounty and the slow external communications. The government slowly invests tax-payers’ money in various local and national infra-structures and the benefits from these improvements to the surroundings, gradually raise the living-standards of the local population, allowing it to be more active economically.

    However, this enhanced productivity of the land is not returned to the community as a dividend on its public investment. Instead, this advantage is taken by the few ex-pioneers who soon become wealthy land-owners and whose monetary gain is in the form of a potential or actual ground-rent, (which is the true measure of the land value). The ground-rent on urban sites becomes progressively greater with the more central locations, having been intensely developed in mid-town due to the high-density of the population, competition for the best locations and their high potential for productivity.

    Speculation in land values often results in some choice sites being unused, which wastes their potential and causes keener competition for the rest. As a result production costs rise unreasonably. This limits and strains the functioning of the social system The relatively few land owners and their production-managers also control the opportunities of the landless majority of workers to earn, whose labour needs access to the land and to its improvements.

    These two social injustices should be rectified by the introduction of land value taxation (LVT) instead of the main tax burden being placed on the earnings, goods-sales and ownership of built-up property.

    14 ASPECTS of LAND-VALUE TAXATION affecting Government, Land Owners, Community and Ethics

    The following 4 economic aspects of LVT are as listed according to the above titled categories:

    3 Aspects for Government:

    1. Most of the ground-rent being collected as LVT, adds to the national income. It allows the taxes on earnings, purchases, capital gains and family/corporate ownership of buildings to be reduced or eventually to be eliminated.

    2. The cost of collecting the LVT is much smaller than for income tax and other production-related taxes. The ownership of each land parcel is registered. Using regularly updated maps, the knowledge of the rental value of each site (as if without buildings) is public. The proportion of this rent that is charged as LVT is simple to understand, the amount of tax easily found and its payment by the land owner impossible to avoid. The many problems arising from legal and confusing escape-clauses in the other tax regimes require an army of tax inspectors. Most of these are not needed with LVT, the the only additional jobs being the up-dating of the land-rent maps and tables of sites data.

    3. With LVT, the national economy stabilizes and no longer experiences the 18 year housing boom and bust cycle, which was due to the changing prices that arose from speculation in land-values during town expansion. Without LVT this cycle initiates due to the growing land prices as building sites are occupied and more are needed. Speculators begin to withhold the opportunities to use them and the prices inflate due to competition for the best. After the speculators have eventually sold their land, the site developers find it very costly to use and demand for it falls. When in panic, land owners whose mortgages have become over-valued try to sell the real-estate, it drops even more in price. Instability from co-lateral borrowing on land value and in trading mortgages also decreases with LVT.

    6 aspects affecting Land Owners:

    4. LVT is progressive, the owners of the most potentially productive sites pay the most tax. None is paid on marginally productive sites, since their owners cannot claim ground-rent from tenants.

    5. The land owner pays his LVT regardless of how the land is used. When the land is leased to tenants most of the resulting ground-rent is the tax. After LVT is introduced, the majority of the population benefit since they are consumers, whilst a minority who are monopolists and speculators in land values and their banks, sustain losses.

    6. Without LVT, as time passes the speculators in land value withhold more sites from use. This raises the prices charged for access to all the sites, due to their increasing unavailability. The tax payers’ money is continuously being invested in the infrastructure. So the urban sites become more useful, scarce and valuable. When LVT is collected it stops the speculation in land prices because any withholding of land from proper use is too costly for its owner.

    7. The transfer of tax from production activities and the introduction of LVT, reduces the sales price of sites. Then the national investment in infra-structure no longer influences the land sales-prices, even though their value (or potential usefulness) may continue to grow.

    8. With LVT, land owners are unable to pass the tax on to their tenant renters, due to the reduced competition for land use. The users of (untaxed) marginal site price their produce according to the costs of their labour, the use of the durable capital and the added transport needs. Owners/occupiers who access more productive land pay LVT/ground-rent and compete in their production, so this tax cannot be added to what buyers willingly pay.

    9. With the introduction of LVT, land prices will drop. Speculators in land values will tend to foreclose on their mortgages and to withdraw their money for reinvestment. Recent mortgage contracts will cease to be worth retaining and the banks holding these contracts will experience losses, after they reposess their properties and need to sell them quickly and cheaply. (The property prices depend on the natural demand for homes, the current rate of LVT and the response by the land owners, not all of whom speculate.) Depending on the rate of these changes bankruptcies can result. So LVT should be introduced gradually to allow the investors sufficient time to transfer money to company-shares in durable capital goods, where their greater use will meet the increased demand for produce (see below).

    3 aspects regarding Community

    10. With LVT, there is an incentive to use the land for production, rather than it laying idle or being partly used. An optimum amount of urban land is brought into use, which reduces the spread of the suburbs onto rurual land and avoids vacant city centers. Some of the urban land was previously held out of use by land value speculators. As these sites become available, their costs decline resulting in lowered competition for their greater use.

    11. With LVT, greater working opportunities exist due to the cheaper land and an increased number of available sites. Consumer goods become cheaper because entrepreneurs have less difficulty in starting-up and running their businesses. Demand grows, unemployment decreases and with it a reduction in the polarization of our class-society and its degree of poverty.

    12. As LVT is introduced, investment money is withdrawn from land and placed in durable capital goods. Then production with more modern tools becomes less costly. The investors in company-shares tend to be wage-earners (as well as banks and monopolists). Their decisions favour more competition and cheaper local production without heavy transport costs, whilst the previous monopolists have less control of prices and the unavailability of alternative goods. This is a natural trend of our free-marketing social system.

    2 aspects of Ethics

    13. The collection of taxes directly from productive effort and commerce is socially unjust. The associated philosophy favours coersive robbery and is “Robin Hood” in style. LVT replaces this form of extortion by gathering the surplus rental income which comes without exertion. Consequently LVT is a natural system of money-gathering, which avoids the present-day distortion of business economics. It also implies the need for taking better care of the environment and that spoilers of nature should repair or pay for the damage.

    14. Bribery and corruption cease with LVT. Before, this was due to the leaking of news of municipal plans for housing development. However the speculation in land values is no longer worthwhile after LVT is in place.

    Very few socialists seem to have sufficient knowledge about how macroeconomics works and before we start to consider all the kind of inequality that need sorting out one should beging with that which is most basic–the right to equal access to land value.

  4. Macrocompassion on April 6, 2014 at 10:18 am

    There is much truth in this article yet it avoids some of the most basic issues concerning equality.

    Equality of what? Communism would have us share all material goods and become equal in possesion. The writer thinks that there would be more equality if money were somehow to vanish so that what appears to be unequal ownership of the means to wealthy (money itself not being wealth) would be better shared. This seems to me to be a slight variation on the communist line.

    What we SHOULD be meaning by equality is surely the right ro equal apportunity ro earn a living and also (since knowledge is a direct means to earning power) that education opportunities should be fairly shared.

    Now we don’t all posess equal talent to be good at understanding what there is needed to know, in order to earn big money, so firstly we are not very likely to be equal here. Better to concentrate on what we are having difficulty at, namely the sharing of opportunity to earn other than by a high degree of academic education. The opportunity to earn a decent living is denied not only people whose education is limited. There are severl academics who also find it difficult to earn in any kind of work-related activnity and if we look into this matter a bit more deeply it seems to depend on the attitude that managers take toward employees.

    Some industries will claim that business is so bad that they don’t want to employ anyone more. Others will find that the opportunities for their previously sucessful line of production are now fading, and so there is no longer much demand for the goods they make, and that this is because of the high production costs involved.

    Production costs are according to Adam Smith 1776 (Wealth of Nations) due to the returning sums for the use of land, labor and capital (durables). Of these 3 returns the one that is most significant here is the ground rent which is returned for the right of access to land. This is what occurs all the time. A useful site becomes available after the tax-payers money has been invested by the loacl authority in making the infrastructure suitable for its access. These development sites are quickly snapped up by speculators in land values with the result that the fierce competition for access to all sites in the region drives up the ground-rent claimed by the landlords. The price of the produce reflects this high cost and as a result the demand for goods is relatively small. This is the situation all would-be entrepreneurs are facing and as a result of this limited opportunity for business, there is a lack of jobs, unemployment and poverty.

    Speculation in land values also makes the home builders output low, for what contractor will begin work on a site where the cost of his new houses is high and few new home owners can afford the results of his business. With limited money in circulation due to these two effects, the economy fails to progress properly and even those who do have jobs find themselves getting low wages due to the high cost of production coming from the need for producers to meet the high ground-rent. Capital costs are not so high these days aqnd bank loans for purchasing new equipment are not the main restriction on the production process, but land is.

Leave a Reply



Archive