Sunday, January 13, 2013

Michel Bauwens — Good taxation is commons taxation, i.e. taxing unearned income from unproductive rents

"In today’s neo-rentier economy the bottom 99% (labor and consumers) owe the 1% (bondholders, stockholders and property owners). Corporate business and government bodies also are indebted to this 1%. The degree of financial polarization has sharply accelerated as the 1% are making their move to indebt the 99% – along with industry, state, local and federal government – to the point where the entire economic surplus is owed as debt service. The aim is to monopolize the economy, above all the money-creating privilege of supplying the credit that the economy needs to grow and transact business, enabling them to extract interest and other fees for this privilege. The top 1% have nearly succeeded in siphoning off the entire surplus for themselves, receiving 93% of U.S. income growth since September 2008." — Michael Hudson, America’s Deceptive 2012 Fiscal Cliff
P2P Foundation
Good taxation is commons taxation, i.e. taxing unearned income from unproductive rents
Michel Bauwens

Michael Bauwens on taxing rent rather than productive contribution.

1 comment:

David said...

This logic was more familiar to the public a century ago than it is today. A property tax to collect this “free lunch” rent is paid out of the rent. This leaves less to be capitalized into new interest-bearing loans – while freeing the government from having to tax labor and industrial capital. So this tax not only is “less bad” than others; it is actively desirable to reduce the debt overhead.

I tried to explain to someone the other day why land value taxation was the way was the way to go vs. taxing building sq. footage, etc. This person responded, saying, "but then the state would own our land and we would pay them rent." I said that that was exactly the point and was the way real property was handled from ancient times and that the modern idea of land as "private property" was a corruption. It doesn't seem to occur to most people nowadays that a bank owns their home and they pay "rent" to it and get no public reinvestment in such and arrangement. It also doesn't seem to occur to people that a higher tax would lead to a lower payment and free up a tremendous amount of demand since the highest expense for most people is housing.