4.1.9-4.2.7: Transforming the Privilege Fund
Module 4, Section 1.9-2.7
Transforming the Privilege Fund
1.10 The protection of massive privatized assets requires armaments and a clever system of propaganda to convince the general public that they must pay taxes from their wage income and/or incur public debt to pay for these “protective services.” At this stage a war economy is in full swing. The military-industrial-financial complex leads to super-state expansion and resultant covert and overt wars for geo-spatial control of natural resources and prime locations such as ports and other transport nodes.
|Dr Martin Luther King said that only ‘the radical reconstruction of society itself' and ‘a radical redistribution of economic and political power' could ‘save us from social catastrophe.” He told us that "a nation that will exploit economically will have to have foreign investments and everything else, and will have to use its military might to protect them… the problem of racism, the problem of economic exploitation, and the problem of war are all tied together. They are the triple evils that are interrelated." 1.11 What is the true cost of war?
Transforming the Privilege Fund
2.1 Diagram Four
2.2 This fourth diagram describes a new role for democratic governance. It shows the Privilege Fund converted to a Resource Rent Fund utilized for the benefit of everyone. A condition for land enclosure for private use would be payment of land rent to the entire community. This is the goal of “land value capture.” “Exclusive” private property rights to land, which includes the right to privately appropriate land rent, is thereby easily converted to “conditional” private use rights to land. Individuals, groups, or businesses can secure use rights to land provided that they pay the full rent of land to society to be utilized for the benefit of all.
2.3 Land Value Capture places the economic foundation of society on the principle of equal economic human rights to the value of earth’s resources. We might call this new mandate for governance “earth rights democracy.”
2.4 Another way to grasp this concept is to consider that land belongs to all on an equal basis, each with an “equal share.” In the best forms of tribal land tenure systems there is an agreed upon process or leader making fair decisions about allocations of land use to clans and families. In complex cash economies, public systems of land value capture play this allocative role. Those who privatize or enclose the most and the best land would pay the most land rent to the common fund. Those with little or no land or poorly located land would pay little or nothing. Taxes on their wages or other productive activities would be eliminated.
2.5 Thus, instead of rent being captured by the few leading to wealth inequality, the new role of "earth rights" democratic governance is to capture land rent for the many leading to a much fairer distribution of wealth.
2.6 As the economy develops and becomes more complex and land rent grows, a percentage of the rent from the now public resource rent fund could be distributed as equal cash payments to everyone, a “citizens dividend” similar to the previously described Alaska Permanent Fund dividend system. Surface land rent is one of the best sources of funds for citizen dividend payments, better than oil rent which would best be utilized to finance renewable energy systems.
2.7 Optional Reading: The Law of Rent and the Economics of War and Peace This paper, first presented in New York at the Eastern Economics Association Conference (2007) on the panel organized by Economists for Peace and Security, further develops the themes of each of the four diagrams in this section.