> The right to exclude other's from nature's benefits is a government
> granted right and it has economic value. Land titles are government
> created legal rights to the exclusive use of natural resources. Land and
> natural resources are prior to human employment and use and to economic
> production.
Land and "natural resources' are prior to human employment but they have
no human value prior to human employment. All value is a consequence of
production; nature by itself has no benefits. When the value produced
by one individual is or would be destroyed by the actions of another
then the producer has an inherent right to prevent the destruction. In
origin this right is prior to government.
If you were right that "land titles are government created rights" then
Proudon ("property is theft") would be right. But Proudon is wrong.
The right to "exclusive use of natural resources" derives from the fact
that sometimes (tho not always) the enjoyment by one individual of what
he has produced requires such exclusive use. Land titles etc. are not
primary; they are derivative of and originate in production. In this
way they are not arbitrary and they are not creations of government.
> ... In order to use the price mechanism to ration the limited supply
> of natural resources efficiently, normally it requires government to
> establish exclusive rights in natural resources, which are government
> created property rights.
Yes, the market requires property. But as I have argued above property
is not arbitrary but originates naturally prior to government.
> The economic value these exclusive rights confer on their holders is
> called economic rent or ground rent. Holders of these exclusive rights
> generally also engage in economic production, so that the value of their
> economic production consists of two parts: 1. the value added by the use
> of the natural resource and 2. the additional value added by the use of
> labour, capital and risk-bearing.
I would describe this differently. Producers generally also make use of
resources and their right to the enjoyment of their production thereby
excludes others from the use of those resources. When those resources
can be better employed otherwise then other people will be willing to
pay the producer more than the value of his product to stop, vacate
and allow the better use. When this happens the original productive
activity may derive some extra value from the ingenuity of others. But
in no case do natural resources by themselves have value. All value
derives from (someone's) production.
> The suppliers of labour, capital and risk-bearing should keep the
> full wages, interest and profit they earn by their supply,
In that we are in agreement.
> the government can take the economic rent of the natural resources
> for public revenue.
But I do not agree that this is legitimate. Even if I granted (which
I do not) that there was an unproduced economic rent there is no
reason to accept the legitimacy of its expropriation by government.
> The fact of adding some value to the production process, and employing
> natural resources to add the balance of value, does not create a
> property right, either legally or morally, to the balance of the value
> added.
I have explained above why I think this is wrong.
> Nature supples an inelastic natural resource, human communities
> are the demand only.
The fallacy in this idea is dealt with in detail the a book by Julian
Simon (sorry I can't provide the title right now). Humans both
produce and consume all values.
> Thus the human community is the source of ground rent.
The ingenuity of other specific persons creates better uses for
resources than those of their present users. Other than these
parties the rest of the "human community" are at best just
customers or at worst envious thieves.
> The governments of human communities have sovereignty over the natural
> resources in a defined geographic area,
That may be a fact. But so is the fact that a thief possesses his
loot. This confers no moral legitimacy.
> and their policies for the allocation of natural resources, and
> for human interaction generally in their community, determine the
> demand for natural resources and therefore the rent. The more
> hospitible are public policies to human production and welfare, the
> greater the demand
There is truth in this. In the same way that you are better off if
a mugger does not beat you. But that does not make it legitimate
for the mugger to take your money.
> Public expenditures, if they add value in net terms,
There is truth to this also. In the same way that you may derive
some "benefit" if a crook gives you some of his loot. But that
doesn't make crime legitimate either.
The *one* legitimate thing that government might do is to prevent crime
by others (which entails enforcing rights to property that are prior to
government) and thereby prevent the loss of value consequent to crime.
This would be a valuable service for which compensation would be
justified. But it does not justify expropriation of anything (including
all "land rents").
> Government could theoretically make its jurisdiction a wasteland and
> all its land sub-marginal, by adopting policies to make land
> inhospitable to labour and capital, no ground rent would arise
> because the demand for land would be less than the supply at a
> price of zero.
If I understand you correctly you are arguing that the ability to
destroy something is a moral justification for expropriating it!
> ... Regular value taxation of the unimproved capital values (Land
> Value Tax) can then occur based on the inferred unimproved capital
> value of all titles. This levies only the economic rent and does
> not tax improvements at all.
Even if this could be done that does not morally justify doing it.
> land titles, whether taxed or not, are government intervention. Like
> fiat money, land titles confer rights of economic value based on
> government decree.
Not necessarily so. This presumes that ownership of land is an
arbitrary fiat based on force. As I have explained above, when
property is properly understood, this is not the case.
> The tax is not passed on to the users of land, has no economic
> deadweight, and does not distort economic activity.
Nonsense.
> People voluntarily pay the rent of land because of the advantages
> the exclusive use of land offers them,
There is no justification for payment to the government rather than
to the people who created the value and are the legitimate property
holders.
> the governemnt simply collects this revenue via a regular
> value charge on the titles it issues. People voluntarily choose to hold
> land based on a contract of sorts between the government, which issues
> and protects the titles, and title holders,
If the government were to protect property and charge a fee for
providing a sort of title insurance service then that would be
legitimate. But the value of this service should be set by competition
with competing title insurance companies. If it were it would not be
expropriation of all ground rents!
> I fully agree that that private sector and private individuals can do
> almost all that the government does now without taxation or government
> involvement. Including police, courts, jails and security. However,
> economic public goods are quite a delema without the insights provided
> by analysis of land rent and the geographic distribution of their
> benefits. This would have to include national defence, foreign
> relations, many core governent services, conservation and environmental
> public goods, local access roads and footpaths and streetlights, suburb
> security, public health (meaning contagious disease control, not heart
> operations), statistics, and many more. Analysis of land rent and public
> goods leads me to believe that large scale competing and co-operating
> proprietary communities can provide/procure almost all public goods
> efficiently, because most public good benefits are excludable over the
> area of a suburb or community, thus allowing suppliers to charge
> communities if communities are prepared to pay.
These comments lead me to think that we are not as far apart as it may
seem. In particular, I agree that "large scale competing and
co-operating
proprietary communities can provide/procure almost all public goods".
> And the benefits of publc goods become capitalised into the immobile
> factor of production, i.e. land, which communities can use as a fund
> for public goods, without taxing human production.
But I do not agree that expropriating land rents does not tax human
production and I would not condone it. However, I would not object to
communities being organized on this basis provided they were genuinely
proprietary. That is, if the organizers bought the land rather than
seized it and if community members voluntarily agreed in advance to pay
all land rents to the proprietors. Then we would see how such Georgist
communities faired in economic and social competition with purely
capitalist ones. But I would not tolerate forcing everyone into
Georgist communities (not that I would actually have anything to say
about it!).
> A federal government may still be needed, but its citizens and taxpayers
> and voters would be communities rather than individuals.
That is an intriguing idea!
CCS
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