On Recovering the Sacred [Rent] Income
Fred Harrison
[Transcript of a talk given at the conference on
Land, the Claim of the Community, organized by Feasta and the Henry
George Foundation of Gr. Britain, October 2003]
WITH THE CORRECT policies in place the major social problems that we
face in the world today can actually be solved. But we need to
understand that we do not have in place those policies that empower
people to solve their own problems. We do not need power to be
exercised from the top down; our problems will be solved from the
bottom up. My function is not to explore the deep detail of the
policies which will actually accomplish what we want. We have a
battery of distinguished speakers who will actually spell out in
detail how policies can be implemented by administrations, by
enlightened politicians if they so wished. My function is to cover
about 150,000 years of human history, and I'll be doing so at quite a
lick. The purpose is this: we need to realize that, given the huge
vested interests that are embedded in preserving existing land
policies and tax policies, effective action will not take place unless
there is a groundswell of democratic demand for action of the kind
that will enable us to solve the problems that otherwise governments
will simply not solve, despite the enormous power that they deploy as
sovereign authorities, no matter how much money they spend, no matter
how much they bully the people, they will not solve those problems
until we make the fundamental changes that will be spelt out over the
next two days. And those changes will not occur until people really
realize there is no option because land is so vital to our prosperity,
to our health. Until we understand that, the people who kid the
population will continue to kid us and get away with literally murder.
So I'm going to provide a broad canvas -- very broad brush strokes --
and I'm hoping that in the coming weeks and months as you reflect on
what you've heard you'll be able to fill in the missing pieces. I will
be making largely assertions: I don't have the time to fill in the
evidence.
The three key words from our conference title are Land, Claim and
Community. Let's go through those three words. Let's understand what
they mean, before we consider the technical issues of dealing with the
problems that confront us. Let's start with the word land.
Land is a biological imperative. We can't live without it. Land, for
the economist, means everything we don't create. It's the minerals
beneath the oceans, and beneath the surface of our soil. It's
farmland, it's urban land, it's the radio spectrum, is the geo
synchronous routes around Earth that satellites rotate through hi
order to send signals back so that we can use our televisions and our
mobile telephones. Land is everything other that what we create.
It may seem a platitude, but we've discovered that when we've gone to
governments in places like Russia, South Africa, even in Scotland, to
address them on the issue of land, they automatically think of rural
land, farmland. No, it isn't. It's everything. They pick on the least
interesting, the least valuable aspect of nature's resources and ask
us, is that what you're asking us to deal with? The answer is no.
Land was initially regulated on the basis of a biological
relationship. Territoriality is a land tenure system that we brought
with us out of the state of nature. Other species behave on the basis
of territorial principles, and those principles remain biologically
ingrained in us. So immediately we see that we're talking about
something which if the relationship is disturbed, is going to have a
fundamental physical and psychological impact.
But land is not just its physical presence. Land -- and this is where
it becomes politically sensitive -- land is actually the rental income
that we all are willing to pay for the benefits of using, of accessing
land. Rent, people say to me, today, people who've been through
university, who are qualified in economics, "What do you mean by
the rent of land?" They do not understand the concept, and yet
these are intelligent and well tutored people. We suffer in our
society from what I call selective amnesia.
There is no mystery about how the labour market works and we have an
exhaustive amount of detail on workers, their wage rates, the amount
of time they spend working and so on. There is no shortage of data on
the capital markets at all. You want to know prices, who owns it,
where it is, what it's doing, you can have it. On the land market,
the shutters come down. Now you have to ask yourself why, when
the professionals say "We want to work with the land, where is
the data?" -- whoops, there isn't any. Why? It's secret, it's
confidential. Big problem. And yet it's the rental value of the land
on which we have built our civilization. Civilization wouldn't exist
today without the rent of land. The rent of land is the measure of the
benefits that people receive from using nature's resources. It was the
capacity to produce a surplus, something like 10,000 years ago, which
made it possible for human groups to come off the land and start to
generate what we now consider to be the distinguishing characteristics
of civilization.
The most important feature is spirituality. When people started
generating this additional surplus income, they reposed it in a town,
in the safe keeping of the temple. They trusted the spiritual leaders
to secure that surplus and to deploy it in an appropriate way. How was
it deployed? Rent made it possible to develop our ability to write.
Rent made it possible for the priests and the skilled people who lived
in the new towns, to develop the art of literacy, of numeracy, of
accountancy. These skills were based on the need to track the movement
of the surplus revenue from the fields and into the towns. That
surplus income made it possible for the craftsmen to develop their
skills to the highest possible accomplishment. It enabled what we
would today call the politicians to organize the complex urban
environment, new social organizations, all of it was built on the
capacity to generate a surplus from the land and to pool it. That's
the key point. The willingness of those communities, whether in
Central America, the Near East, South east Asia to pool that surplus
revenue, the surplus product from the land for what we would today
call the common good.
Without that willingness to pool those resources we would not have
civilization. We know from the onset of the last ice age about 150,000
years ago to a point where the ice began to recede 30,000 years ago
that mankind did begin to express a spiritual awareness. But it was
slow in coming, it was there, we see it in the burial mounds.
Neolithic man certainly expressed this spirituality: we see it in some
fine tombs here in Ireland. But it was the onset of civilization and
the willingness to pool that surplus hi the urban context that made it
possible for the spirituality that's latent in all of us to flourish.
And then the rest of what we're capable of in the arts, in the crafts,
to explode into what we now call civilization. That's what we mean by
land. Civilization. Without it, without more specifically the
willingness to pool the rent of land we wouldn't have civilization.
Claim. What do we mean by "claim to the land"?
Anthropologically speaking, land was not individually owned. Today we
celebrate the individual as if the individual is the key focus of all
human creativity. But in fact the individual derived his or her rights
through membership of the community. It was the community that laid
claim to the right of access to natural resources, and the individual
exercised that right through membership of the community. So it's
wrong of us today to develop a philosophy of individualism as if the
individual has superior rights over the community. In fact, the
individual derives his rights, derives his or her existence from and
through the community. The emphasis we place on individualism today
derives from the wish to preserve the notion of the privatization of
land and rent. That's something for you to reflect on. Today we need,
if we're going to recover the ability and the freedom to develop all
the skills that's latent in us as individuals and in our communities,
we need to rediscover a theory of community that locates and
celebrates the individual within the context of the community.
What do we mean by community! Well, almost nothing. Today we
disparage the community, we abuse the community. Look at the question
of taxation. We begrudge giving the resources to the community and yet
without resources the community cannot function. And we devote all our
time wrestling with the problems, trying to figure out how to solve
the difficulty of relaying the resources to the community to provide
the services that we say we want. Why is there such a problem when
five and six and seven thousand years ago in the deserts in
Mesopotamia they had no difficulty. They could build complex networks
of transportation and irrigation, hydraulic systems for flowing water
throughout the desert to produce a huge surplus that enabled people to
create the ziggurats and produce the fine craftsmanship with almost no
difficulty, and we can't make our trains run on time? Can't provide
sufficient road space? Can't deal with the nitty gritty of making our
communities function? Why? Have we regressed intellectually? Obviously
not. There's something fundamentally wrong and there's only one thing
that's wrong: we lost the art of sharing the surplus.
As a consequence, we've abused ourselves as individuals. Our
psychology, our mental health, our creativity is a function of a
community that's flourishing, that's creative, that's healthy. And if
we don't have communities that are healthy, individuals can't express
their full potential. So I call this revenue, this surplus, sacred
rent. Sacred income. It's the sacred revenue on which we were able to
construct civilization. Sacred because we actually did give it to the
temples to look after it for us. The temples were charged with looking
after the widows and orphans, making sure that the irrigation systems
worked, that the fields were fertile, and could produce the surplus so
the urban workers were released from the need to work in the fields to
produce all the additional things that can't be generated out of the
soil. We lost the capacity to preserve the sacredness of that rent. We
privatized the rent, we profaned it. And the consequences are with us
today.
The individual is capable of achieving fantastic things, but only
within the context of the community, a community properly financed,
but financed in a way that actually releases the latent power in all
of us. The point is this, and this is what will be stressed over the
next two days. It's not how much we take from people to give to the
community, it's how we take it. And it's what we take.
The way we take resources today actually abuses people and abuses the
community. Taxation is based on arbitrariness and abusiveness. It is
not based on principle on the realization that, actually, we all ought
to pay for the benefits that we receive. Now here's a very curious
thing. People will go to the ramparts and defend then- right to
continue to receive the rental income of land as their private income.
Somehow they've inverted reality. What was sacred is now turned on its
head and we legitimize the privatization of rent as if this is based
on a sacred principle.
And yet, the basis on which we operate in the labour markets is this:
you pay for the benefits you receive. Nobody expects to hire labour
and pay them a sub-standard wage, and workers won't voluntarily sell
their labour for less than what they're worth. Payment for the
benefits received. It's the same in the capital markets. You can't
borrow money, you don't save and invest and expect less than what you
feel you're entitled to, based on the benefits that you're giving or
receiving. It's this principle of paying for the benefits that you
receive. In the consumer market, when you go into a supermarket, you
don't expect to walk away with a trolley full of goods and not pay for
the benefits you receive, do you? You can't go into a showroom and say
"I want that car, but you don't expect me to pay for it, do you?"
No. But in the land market, people expect to receive benefits and not
pay for them. And because they don't pay for the benefits they
receive, they are able to capitalize the value of those benefits, a
rental stream, into a selling price, and flog the land at that price
to somebody else. Now that is a trade in what should be the
community's social revenue, which we, through default -- the failure
of our communities to protect the revenue that they generate -- enable
others to capitalize it into a selling price and to trade it. You
can't blame people for doing what is not unlawful, so there's little
point in knocking the landowner. Most of us probably are landowners,
albeit in a small way with our homes: there's no point in knocking us
for doing what is allowed. We knock the community -- which is us, if
we are a democratic community -- for failing to observe our
obligations to members of a society that could not exist without a
budget, a flow of resources, that pays for the services that we can't
supply for ourselves as individuals.
We suffer from selective amnesia.. We've forgotten what our ancestors
knew, which is why our public administration, our politics, our urban
civilization is based on all manner of arbitrary principles - we can't
call them principles - procedures designed to cover up, patch up our
failure to do what ought to come naturally.
Why have we forgotten about rent? Its social function, its sacred
function. Why have we forgotten it? I don't have the time to go into
the history of the way we privatized and profaned that rental income.
But we need to recover the understanding that we had. It really is
only a recovery. It is a relearning of what we already knew.
I would like to give you a simple graphic demonstration of how these
ancient people in the deserts in what we today call Iraq, the place
where dropped so many bombs not so long ago, how they understood the
economics of community, and of individual enterprise.
Archeologists have dug up the tablets from underneath the desert
around those civilizations in Mesopotamia and we're still transcribing
the meaning of those etchings on clay tablets in the dark and dusty
rooms of the British Museum. One of the tablets came out of a hoard
that belonged to a family whose existence can be tracked over 5
generations in Babylon. One of those tablets had this image on it
[sound of drawing...]
There's Babylon, there's the canal, the hanging baskets of flowers,
and the irrigation system that made it possible for the arid fields to
generate the surplus. On that etching was the inscription which
informs us that the land closest to the water was the most fertile,
had the most date trees on it, generated the greatest product. The
strip of land beyond the most fertile was less generous in its product
but nonetheless it produced a surplus. Beyond that was the land on
which you could barely exist: this was the subsistence land. Now what
these people were doing was generating the surplus, sending it up the
canal to Babylon.
Babylon didn't start as a corrupt society. It started as a
civilization based on the principles of the common good. But then
something went wrong, badly wrong. And we know it was corrupted. Well,
why was it corrupted? Before I fleetingly refer to why, notice what we
have here. It took 2,000 or more years for our society to say "Whoa,
the theory of rent, the theory of surplus", which we associate
with the name of David Ricardo, and his book on the principles of
taxation.. What he said was, look, at the centre, this is the centre
[drawing on paper...] this is the point closest to the waters, to the
canal, the product is at its greatest, the further away you go from
the fertile point, the most productive centre, you get a lower output,
that's lower there and on the margins, where you can barely live,
that's the margin of cultivation, of existence, its where you could
just pay for the costs of production and reproduction. You could just
keep a family, you could just renew the capital you needed to live on
the land, you couldn't generate a surplus. But these people, by
developing the arts of increasing output beyond what they needed for
subsistence, could generate this massive surplus [sound of drawing on
board], over and above the margin. And that was the surplus from this
land which Ricardo's classic diagram enables us to measure with
precision, that was shipped up the canal to Babylon..
Why did Babylon become corrupted? Why was its days doomed at some
point in time? The answer is very simple. At some point in time they
forgot that that surplus from the most productive land belonged to the
community and should pay for the spirituality of the community and the
development of its arts and its crafts and facilitate the circulation
of life in a complex urban order. They started to privatize that
revenue. They inverted the reality: they profaned what was the sacred
income, and it was inevitable that corruption at the heart would set
in which would foredoom the civilization. And we know, of course, that
Mesopotamia is a history of collapsing civilizations, that's the
reason why. So we need to go back to no further than David Ricardo's
Principles of Political Economy and Taxation (1817) and
realise that there is no mystery about how to solve our society's
problems: we can relearn the art of civilization, recirculating the
sacred income and as a consequence we don't need to tax people on
their wages and on their savings. This delivers the rebalancing of the
community. Now the weakling, not the Hollywood Hercules [Arnold
Schwartzenneger] can solve his own domestic problems and his
community's and his wider society's problems, because actually he's
doing it, or she's doing it, for himself or herself. There is no need
for magic wands from the centre or from supermen, such as our friend
Mr. Schwarzenegger. We need to revisit the way we think about society.
We need to revise those disciplines that have been discredited.
Economics is a discredited social science. Even people within that
profession are publicly voicing their dissatisfaction. Sociology, as
the science of society, is also a discredited approach to
understanding how society works. Therefore, one of the issues that we
can't even begin to touch on today is to focus on how we can redesign
the way we study our communities and express our findings in a way
that is coherent and enables the public administrators to formulate
policies consistent with the natural rhythms of our life and our
natural rights and our aspirations.
We need a new science of society. We even have a name for that new
discipline. It's described in Kenneth Jupps' little book Stealing
our Land. It's called "geocleronomy". 'Geo' is land,
'clero' -- the acquitable sharing of inheritance, 'nomy', the laws.
When translated into English, this means the laws governing the
sharing of the inheritance of land. This new approach to studying
society and the natural world enables us to synthesise our
relationship with nature in a way that produces all that we say that
we want. In our habitat, we can have a sustainable society.
There's no problem about having sustainable, environmentally friendly
systems, we only need to understate the relationships that I've been
summarizing this morning. Civil society can be elevated from one where
we have internal conflict, constant battles: we define our civil
society in terms of conflict, we think that democracy should be about
opposition as opposed to consensus, cooperation. Once we understand
that the community is a social space and that we all have an equal
right to occupy that space, we retain competition, we retain
individuality, we celebrate these things within the context of
cooperation and community. Once we've recalibrated the system, the
tensions evaporate.
Economics: globalization is good, provided we take the globe out of
globalization. Once we've done that, the free exchange of goods and
services and of people around the globe without the exploitation of
nature - which is actually what drives the present globalization
becomes one where we all enrich ourselves to achieve our needs. We
fulfill our mission which is to unite humanity in one multicultural
civilization where we share social space. We only do that if we learn
how to reorder that social space in a way that is not possible at the
moment on the basis of private territorial rights.
How do we help the Hebrews and the Muslims in Israel/Palestine to
co-exist in one physical space? By recognising that that space is
actually a social space. You can have several layers of social space.
They can occupy the physical terrain, co-exist within it peacefully,
providing we respect everybody else's equal right to do so. And the
same applies in Northern Ireland and with the Basques in Spain and the
rest. What we're talking about over the next two days goes way beyond
how we pay for another road or a train. We are talking about providing
ourselves with the tools for solving apparently intractable problems
of territorial conflicts. We are actually defining our selves no
longer in the purely natural world: we live in a social universe. But
we have to redefine that social universe so that we all have equal
access to its benefits. We have to resocialise the social revenue.
Until we do that we will continue to fail, but there is no excuse for
that failure because we do have the answers.
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