Re: OWNERSHIP: Moral principles and Binary Theory of Property

["Norman G. Kurland" <thirdway@cesj.org>]

Ed,

My problem with your handling of rents on land and natural resources is that it cedes too much power to the state, although both Kelso and I would agree that there is a difference between that which is contributed by nature and that which humans contribute in the form of their labor and their non-land form of asset inputs.  (See Kelso's treatment of land in his critique of Marx at http://www.cesj.org/thirdway/almostcapitalist.htm).  And, as you know, I find Kelso's binary theory more compelling for solving the income distribution problem, as well as more consistent with the democratic ideal of structuring the diffusion of power from the individual up, rather than from the state down.  For years I have been promoting the Community Investment Corporations (CIC) as a strategy for dealing locally with land and natural resources with maximum citizen participation and limited or no governmental control.  ( See http://www.cesj.org/homestead/strategies/community/cic-full-nk.html and articles linked to this paper.)  We're working in several cities to launch CICs.)

For the last few years I've been working with people to apply the CIC concept to all the oil reserves in Iraq, where each citizen would have a single share from birth to death and thus would share the power of ownership and control over these natural resources.  Thus the rents would flow directly to each citizen, who then would be taxed to support all government functions at the national, regional and community levels.  Attached is the latest revision of the Executive Summary of our proposal, which I'll be discussing with Senator George Allen (R-VA) when I meet with him on July 14th.  The main difference, I think you'll see, is that my proposal would maximize the power of the individual citizen and make the government economically dependent on the people, rather than vice versa. 

Do you have any problems with the approach?  If so, how would you improve the plan?

Norm Kurland

Ed Dodson responding...

Norm Kurland wrote (6/27):

 

Rodney is correct that "labor" and "capital" are independently productive if we understand that in binary economic theory we consider labor and capital as independent variables in the mix of contributions humans (and only humans through their ownership rights) make to the process of producing economically useful goods and services.  But John is also right in stating the obvious empirical fact that for purpose of economic analysis the capital factor cannot work without the labor factor, at least until the robots of the world can perform all the economic work and human economic work is eliminated entirely.  Hence, I would argue that the two factors are "independent" variables of any economic productive process for determining distributive rights in an economy based on private property and competitive markets, but these factors operate "interdependently" or "cooperatively" (as suggested by Rodney) in the real world.   

 

Ed Dodson here:

I view the plan advocated by Adler and Kelso as mitigation rather than as transformative. Taking my lead from the moral principles espoused by Henry George I accept that the earth is our equal birthright. The political economists from Turgot and Smith on dealt in their own way with the land question; that is, whether any individual can justly claim as private property the rental value of land. Rent arises in societies because the supply of land is fixed, while population keeps increasing. Binary economics redefines rent as interest (i.e., a return to capital). The fundamental disconnect is that land (i.e., nature) is the source of all wealth. When some are denied access to nature, they are denied their birthright. Binary property rights mitigates the current distributional injustice but does not address the fundamental problem that rent -- as differentiated from the interest earned by the use of capital goods in the production of wealth is -- and under law ought to be -- treated as wealth belonging to the entire community. The rent fund is what is available to us to cover the cost of public goods and services we democratically agreed upon; any surplus should be distributed to each person as a "citizens dividend."

 

 

Attachment: AbrahFed-IraqExecSum6.doc
Description: MS-Word document