5. (2014 September-October) Social Media: Libertarians Battle Over a Citizen’s Dividend

Michael Huemer is a libertarian writing for the Cato institute. He is a proponent of the Basic Income Guarantee (BIG). In an article which can be found here, he argues against LVT from the standpoint of the best way to fund a BIG. His contention boils down to opposing redistributing what people produce in a high density area to those in a low density area. He says that the Georgist ethos of “one ought to keep what they produce” is contradicted by such spatial redistribution.

In this article, Matt Zwolinski, also writing for Cato, argues that the Georgist ethos is not inconsistent.

“Mike brings up the issue of population density to show that a large part of land’s value depends on the productive activity of other people. But, really, all of land’s economic value depends on the productive activity of other people… It’s not benefitting from the positive externalities of others’ labor that’s the problem. It’s the forcibly excluding others from doing so [the higher return available given access to the best locations].

This explains why, contra Huemer, people in low-population-density areas are entitled to compensation from people in high-population-density areas. High-population-density land is, ceteris paribus, more valuable than low-population-density land.”

4 thoughts on “5. (2014 September-October) Social Media: Libertarians Battle Over a Citizen’s Dividend

  1. Wow! I had no idea that Libertarians were advocating a Basic Income Guarantee. B.I.G. I always thought Libertarians were for letting everyone keep what they had, to the extent practicable.

    The Basic Income Guarantee must be a redistribution of wealth, unless they are advocating that the government print up some money and give it to everyone in equal portions. And even then, the inflation it caused would be a redistribution of wealth.

    However, funding the Basic Income Guarantee from land value taxes would be a charge based on the principle of “Equal Opportunity” Land is a natural opportunity; you can’t make something out of nothing. Therefore, charging people who have exclusive possession of a common opportunity is the only way to fund a Basic Income Guarantee without a communistic redistribution of wealth.

  2. Libertarians need to do more than read Rothbard. Thomas Paine advocated for a citizen’s dividend paid for by land rents from farmers. Libertarians who advocate for absolute land monopolies are monarchists, not libertarians.

  3. I forgot that I had posted before. I do think there is some logic to Michael Huemer’s worry about taking from densely populated areas and sharing equally with people in sparsely populated areas. It seems true that at the foundation population density is the source of land rents. However, some natural opportunities seem to work in tandem with population. Navigable water, especially with deep water, mineral deposits, nice weather, fertile soil to name a few. Part of the dividend would only compensate for the disparity in natural opportunity. Another part of the dividend might be shared by those who’s density created it.

    On the other hand, A lot of land-rent is needed to maintain the infrastructure and public services, without which the population could not be so dense, and the rental value of land would only be a fraction of what it is with them.

    Mike Curtis

  4. I think Huemer is misunderstanding the concept of land. The value of land in a densely populated area is not only determined by the people who live there; it is determined by everyone, everywhere. When you pay to occupy land, you should pay the people you exclude, and that’s not only the people next door; it’s everyone.

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