4.1.1-8: Introduction

Module 4, Section 1.1-8



A goal stated in the UN Millennium Declaration: To make the United Nations more effective in maintaining peace and security by giving it the resources and tools it needs for conflict prevention, peaceful resolution of disputes, peacekeeping, post-conflict peace-building and reconstruction.


There are now 20 million refugees predicted to increase to 50 million in the next five years. Warfare over land and resources will destroy us all unless and until we find ways to equitably share the earth.refugees

1.1 Now we will take a step deeper into our land economics analysis and focus on how the private appropriation of land rent leads inexorably towards a warfare state and a highly militarized economic structure. The following diagrams will give you an appreciation of the importance of land value capture in building a world of peace and plenty for all.

1.2 Essentials of Economic Rent and a War Economy

1.3 This first diagram brings our attention to the fundamental person/planet relationship - that of human beings applying their energies to the gifts of nature in order to obtain food, shelter and other basic necessities of life. Some people, even today, are finding deep satisfaction in living simple lives in harmony with the natural world, and that they can meet much of their basic needs for food, shelter and energy with little need for cash. The most essential requirement is access to land that can be made fertile and productive.

1.4 Privilege Fund Grows

1.5 The second diagram shows that structural violence, indicated by the gun images, begins at the point when land is privatized by the few who are then in a position to charge Rent as a condition for others to have access to land. In economies having exclusive private property rights to common assets, as economic growth and development proceeds, land and resource values increase, and the wealth of elites grows as a result of the private appropriation of Rent. This inequitable accumulation of private wealth gives elites a disproportionate capacity to make loans to others. Thus they are able to capture massive amounts of financial interest(debt payments) as well.

1.6 The “Privilege Fund” is the descriptive term in the diagram indicating economic rent (unearned income) captured by economically powerful corporations, banks and individuals. Wages do not keep up with the cost of land for housing, and in many countries taxes fall heavily on wages, so most people must borrow and pay interest for their homes, business capitalization, higher education, etc. The middle class, if there was one, shrinks while multi-millions of people face poverty, homelessness, and food insecurity. At this point the rent-seeking activities of finance capitalism has overpowered the productive economy.

woman begging with 2 children (poverty in the middle east)getawayafrica limo Oil rich countries of Africa (namely Nigeria, Gabon, Sudan, Congo, Equatorial Africa, and Chad) have long histories of coups, military rule and dictatorship. Millions have died of hunger, disease and murder while wars over oil, diamonds, copper, and other mineral resources made life-generating economic activity difficult or impossible to proceed. - Africa under further menace of Resource Wars

1.7 Privilege Fund Enables War System

1.8 Diagram Three indicates that as the wealth and power gap between the very rich and the rest continues to grow the swelling Privilege Fund gives both motivation and capacity to invest in land, resources, and industries abroad and/or to engage in resource wars. The Privilege Fund is used also as a loan fund to indebt poorer countries. For instance, some international financial institutions’ original “portfolios” were secured by profits (resource rent) derived from oil.