Welcome to the July issue of The Georgist News. Welcome to new readers, Bina Patel and Christopher Pike. The numbers show the land-price cycle playing out as geonomists predicted. They also bear out how subsidies do push up prices and how public recovery of rent does not. As usual, there's the news not to be missed and endorsements from media and leaders in the U.S. and abroad and from key figures of the past. Fun reading for the next vacation! CONTENTS: 1. Movement Business: 2007 conference gathers many top scholars 2. Good Press: UK left; CT big city; AM news in a desert 3. News: China tax; Taxes tickle; Ethanol up rent; FCC defends auctions; Iraqi oil missing 4. Numbers: Record foreclosures; Biggest price dips in 16 years. 5. Movement Progress: UK journal picks up LVT article 6. Corrections: FLOW founders; Last issue data and quote 7. Letters to editor: Geoist in journal; Latest Guardian; Danish plea to Russia 8. Likable links: Gutenberg Project; Progress Report; James Petras 9. What You Can Do: Ask friends to name that zine! 10. At the Margin: Quips and Quotes 11. Publication affairs: Contributors, About the Georgist News ================================================================== 1. Movement Business: 2007 conference gathers many top scholars By Sue Walton, sns at swwalton.com, June 7, 2007 The members of CGO Executive Committee (Ted Gwartney, President, Ed Dodson,VP, Pia DeSilva, Secretary, and Toni Gwartney; Lindy Davies and Dan Sullivan, Advisors, are looking forward to the 2007 CGO Conference, Two Views of Social Justice: A Catholic/Georgist Dialogue. The event is being co-sponsored by the University of Scranton and the Robert Schalkenbach Foundation. Never has there been such a grand assortment of Georgist Scholars: Jim Dawsey, Mason Gaffney, Brendan Hennigan, Frank Peddle, Bill Batt, Alanna Hartzok, Josh Vincent and John Beck; not to mention Georgist Jeopardy on Monday and John Kelly of Peoria presenting "The Brighter Side of Economic Justice: What the World is Doing Right." Please plan to join us! For more information please call Scott or Sue Walton at 888-262-9015 or 847-475-0391 before July 15th. ================================================================== 2a. Good Press: British policy wonks suggest LVT to Brown By New Statesman, June 4, 2007 (via Dave Wetzel) "50 ideas for Brown's Britain" asked five leading think tanks to suggest ten-point plans for the Gordon Brown premiership. The second point in the submission from Compass reads, "Tax Land -- It is often public investment in schools, roads and other supply-side measures that creates unearned gains by landowners. A land tax would stabilise house prices, slow speculation, and rebalance regional and wealth inequalities." ================================================================== 2b. Good Press: Connecticut again reads proposal of LVT By Tom Condon, editor of Place, Hartford Courant, June 10, 2007 "The thought is that the land tax, pioneered by 19th century economist Henry George, will encourage owners to get the most out of the land by building on it or selling it to someone who will build on it. Downtown seems like a very good candidate. Speculators are buying buildings and holding on to them. If owners had to pay higher taxes on land, this kind of bottom feeding would be discouraged. Conversely, building in the trident areas would be encouraged." ================================================================== 2c. Good Press: In a parched place, a dose of wisdom By Nicole Warburton, the Desert Morning News, 2 June, 2007 (via Ed Dodson) In an oft quoted address to the New York Anti-Poverty Society in 1887, Henry George, a writer and speaker, said he considered it stealing if a person didn't give to the poor. "'Thou shalt not steal,'" he wrote. "Does it not also mean, 'Thou shalt not suffer thyself or anybody else to be stolen from?' If it does, then we, all of us, rich and poor alike, are responsible for this social crime that produces poverty. Not merely the people who monopolize the land -- they are not to blame above anyone else -- but we who permit them to monopolize land are also parties to the theft." ================================================================== 3a. News: China levies another partial land tax By Cao Qian, Shanghai Daily, June 14, 2007 In China the government let Shanghai tax the rise in location values anywhere from 30% to 60% when a speculator (a short-term owner) sells out. ================================================================== 3b. News: Paying taxes gives pleasure? By Joe Rojas-Burke, The Oregonian, June 15, 2007 In experiments, when subjects had to give to a charity, the part of the brain that lights up from food or sex also rewarded these pseudo taxpayers. Subjects who voluntarily chose to give money, their brains lit up even more -- but apparently not enough: people given the choice gave 10% less than subjects who had no choice. ================================================================== 3c. News: Land takes ethanol subsidy By Des Moines Register, May 29, 2007 (via Dr. Fred Foldvary, Santa Clara University) When we subsidize them, farmers can make money farming or by selling or leasing land. On one hand, returns from farmland have averaged 10.9% annually the last 15 years (Bloomberg, February 20). On the other hand, the growing demand for ethanol has pushed up corn prices an average of 63% to $3.31 a bushel during the first quarter of 2007. So, farmers nationwide expect to plant 16% more acres to corn this year. In Iowa, the value of good farmland shot up 16% over the last 12 months, with 7%, or nearly half the total increase, coming in the first quarter of 2007. ================================================================== 3d. News: FCC defends EM auctions By Evan Kwerel, Office of Plans and Policy, Federal Communications Commission, October 2000. (via Heartland's Institute's Joe Bast) In "Spectrum Auctions Do Not Raise the Price of Wireless Services: Theory and Evidence" the author states, "A widely held misconception about auctions for spectrum licenses is that they will raise the price of wireless communications services. If licensees pay for their licenses instead of getting them for free, it is argued that they would have higher costs and that these costs would be passed on to their customers in the form of higher prices. This conventional wisdom is, however, contradicted by both economic theory and empirical evidence." ================================================================== 3e. News: Iraqi oil rent disappears By James Glanz, International Herald Tribune, May 13, 2007 Between 100,000 and 300,000 barrels a day of Iraq's declared oil production over the past four years is unaccounted for. Using an average of $50 a barrel, the discrepancy was valued at $5 million to $15 million daily. These new figures reinforce longstanding suspicions that smugglers, insurgents, and corrupt officials control significant parts of the country's oil industry. ================================================================== 4a. Numbers for May & Q1: Records set for foreclosures By MarketWatch, June 11 The number of households spending more than half their income on housing increased in one year by 1.2 million to 17 million in 2005. That year, records were set for home sales, single-family starts, and house-price appreciation. Then in 2006, while median house prices increased at least 10% in 23 of 149 metropolitan areas, they fell in 34 metros. Of the 11 metros that had declines of greater than 3%, nine were in economically depressed areas in the Midwest. The amount of home equity cashed out set a record. By Jeannine Aversa, AP, June 14 In California, Florida, Nevada and Arizona, speculators walked away from properties since home prices fell as interest rates rose. Late payments and foreclosures on adjustable-rate home mortgages spiked to all-time highs in 2007 Q1, up from 14.44% to 15.75%. The percentage that started the foreclosure process climbed from 2.7% to 3.23%, the highest on record. Among lenders of loans with teaser rates, 30 have gone bankrupt this year. In Q1, the number of all mortgages starting the foreclosure process rose to 0.58%, a record that surpassed the previous high in 2006 of 0.54%. By Rex Nutting, MarketWatch, June 19 In May, permits for single-family homes dropped to a 10-year low. Completions of housing units fell to the lowest total in six years. The builders' confidence index fell to 28 in June, meaning that less than a third of them figure they can find more customers. The reading of 28 marks a 16-year low (close to the 18 years that mark the peaks and troughs in the land price cycle). By AP, June 26 In May, sales of existing homes fell by about 10% from last year to the lowest level in four years, and prices dipped for the 10th month in a row. The inventory of properties on the market has swelled to an 8.9-month supply, highest in 16 years. The median price for an existing home fell about 2% to $223,700 from a year ago. By MarketWatch, June 26 In May, home prices in the 10 cities fell 2.7% on a year-over-year basis, the largest decline since September 1991, sixteen years ago. Meanwhile, prices in 20 cities dropped a record 2.1% year over year. Price appreciation has slowed for 17 consecutive months. By the iShares Dow Jones US Real Estate index (an ETF and NYSE: IYR) At http://finance.google.com/finance?q=IYR in the YTD or 1-year chart, Dr. Fred Foldvary of Santa Clara University notes that commercial real estate, which lags behind residential, seems to have peaked in February. ================================================================== 5. Movement Progress: UK journal picks up LVT article By Fred Foldvary, June 17, 2007 Dr Fred Foldvary's article, "Answering the Questions on LVT," has been published in the June 2007 issue of the British journal, Economic Affairs. ================================================================== 6a. Correction: Clarifying FLOW, cited in June issue By Michael Strong, June 7, 2007 FLOW was co-founded by myself and John Mackey, who happens to be the founder and CEO of Whole Foods Market (WFM). But FLOW is strictly a private philanthropic interest of his, and there is no connection whatsoever between FLOW and WFM. Moreover, while John has provided seed funding, he has deliberately not given us a blank check. We are fund-raising because we need more funds to support our existing operations, let alone grow. That said, we have a very solid platform from which to build, and anticipate that in a few years we will be a significantly larger and better funded non-profit. ================================================================== 6b. Correction: Clarifying June issue numbers and quote By Nicolaus Tideman, June 2, 2007 Be careful with numbers! The official story does not report a 16-year low in the prices of existing homes, but rather a 16-year low in the rate of increase of the prices of existing homes, measured by prices in quarters a year apart. While the author of "More is given to us ... and, therefore, more is required of us" was Henry George, note Luke 12:48 contains, "For unto whomsoever much is given, of him shall be much required" (King James Version). Contributor, Mason Gaffney, replied that George and many of his readers were so familiar with The Bible that George often paraphrased it without seeing any need to cite it. ================================================================== 7a. Letter to editor: Georgist in a global journal By Paul Metz, May 11, 2007 In the May issue of the International Tax Review, the cover story reports on the EU Tax Forum on Sustainable Development of March 19-20 in Brussels. It includes my contribution among those of other experts and opinions. Dutch and other states are invited to include carbon tax diplomacy in their efforts to prevent further climate disruption and oil and gas shortages. Any questions and invitations are welcome. ================================================================== 7b. Letter to editor: Latest Aussie Guardian available By David Brooks, May 17, 2007 For those of you who may read Guardian, an Oz newssheet based in Victoria, it is available at http://people.aapt.net.au/~radical/Guardian.html I hope you like it and pass it on to friend and foe alike. For those of you who use Comcast ISP, there appears to be a problem in direct communication. Comcast blocks mail from my ISP, AAPT.NET.AU. However, the same material can be sent via Hotmail. Big versus small? ================================================================== 7c. Letter to editor: Letter to Kasparov available By Ole Lefmann, olefmann at tinyonline.co.uk, June 13, 2007 An Open Letter to Garri Kasparov was written by my Danish friend, Mr. Ib Stromberg Hansen, who asked me to translate it into English, which I did. Ib has sent the article to Danish (Politiken), German (Der Spiegel), US (Newsweek) and Russian (St. Petersburg) newsletters. ================================================================== 8a. Likable link: The Gutenburg Project (literary giants on-line) Via Mark Monson, March 1, 2007 - From Resurrection, by Leo Tolstoy (1828-1910), who kept a photo of George on his desk, and warned the Czar that refusing to fairly share land and its rent would lead to revolution, and whose dying words to passengers on a train were to tax land alone. He wrote, "Henry George's fundamental position recurred vividly to his mind and how he had once been carried away by it, and he was surprised that he could have forgotten it. The earth cannot be any one's property; it cannot be bought or sold any more than water, air, or sunshine. All have an equal right to the advantages it gives to men... he formed a project in his mind to let the land to the peasants, and to acknowledge the rent they paid for it to be their property, to be kept to pay the taxes and for communal uses." - From Abroad With the Jimmies, by Lilian Bell: "And one of your greatest Americans," went on Tolstoy, "was Henry George." - From Mark Twain, by Archibald Henderson 1910: "So eminent a publicist as Mr. William T. Stead pronounced 'A Yankee at the Court of King Arthur' at the time of its first appearance, one of the most significant books of our time; and classed it (with Henry George's 'Progress and Poverty' and Edward Bellamy's 'Looking Backward') as the third great book from America to give tremendous impetus to the social democratic movement of the age." - From The Personal And Literary Life Of Samuel Langhorne Clemens, by Albert Bigelow Paine: "Ever since the appearance of the Yankee there had been what was evidently a concerted movement to induce him to write a novel with the theories of Henry George as the central idea. Letters from every direction had urged him to undertake such a story, and these had suggested a more serious purpose for the 'American Claimant' book. A motif in which there is a young lord who renounces his heritage and class to come to America and labor with his hands; who attends socialistic meetings at which men inspired by readings of 'Progress and Poverty' and 'Looking Backward' address their brothers of toil, could have in it something worth while." ================================================================== 8b. Likable link: The Banneker Center's Progress Report By Jeffery J. Smith Every day The Progress Report draws thousands of hits from people curious to read more about such happenings as ... - From "Record market, record salaries": * Some managers of hedge funds received paychecks of more than $1 billion each. * Companies like IBM, Coca-Cola, and Intel -- all among the 30 in the Dow Jones Industrial Average -- derive well over half their revenue from abroad. * New York imported a Mexican idea, trying a pilot project to pay parents who meet criteria related to work, health, and education $5,000 a year -- a 25% raise for a family of four living on $20,000. - From "Housing Prices Falling": * The government used to define housing affordability as a household spending 20% of income spent on housing; now it's paying up to 30%. ================================================================== 8c. Likable link: Wealth gap (progress vs. poverty) By James Petras at stwr.net While income for the lower 55% of the world's 6-billion-plus people declined or stagnated last year, the total wealth of the global ruling class grew 35%, topping $3.5 trillion USD. It came mostly from speculation on equity markets, real estate, and commodity trading, rather than from technical innovations. ================================================================== 9a. What You Can Do: Ask friends to name that zine! By Jeff Smith Last month, eight of you kindly voted and even submitted a couple new entries. While the new ones were interesting, judging by voter turnout, one can ask people to express their preferences only so many times. Hence, the following results are final (I bid a fond adieu to "Nature's Pay"). Now it remains to be seen if any gets chosen by a funder for a new e-zine. The only ones to receive more than two votes were "Free Lunch" (eight votes from four people) and "Privilege Report (five separate votes)". If you know any non-geoists who might like to tell you which one sounds best to them, please poll them. Thanks. ================================================================== 10. At the Margin: Quips and Quotes Democracy -- n. A form of government so extensively exported that the domestic supply has been depleted. -- David Bean (Oregon carpenter and poet) Quiz: Who anticipated ... ? * the Turner thesis (the American frontier closing) by 11 years? * "Spaceship Earth," by about 90 years? (Boulding revived it in 1969 or so.) * the "Lorenz Curve" for measuring concentration of wealth and income, in his debates with Francis Walker? Whose attack on Walker moved the U.S. Census to revise its reporting methods, from 1900? The model for the new census format may be found in the 1894 Report of the Illinois Bureau of Labor Statistics, headed by single-taxer George Schilling, appointee of Henry George's friend, Illinois Governor John Peter Altgeld. Schilling applied it to landholdings in the Loop of Chicago -- better done than the U.S. Census, although Schilling had no formal training. - Dr. Mason Gaffney, UC Riverside ================================================================== 11a. Publication affairs: Contributing to this issue Joe Bast, David Bean, David Brooks, Ed Dodson, Fred Foldvary, Mason Gaffney, Ole Lefmann, Paul Metz, Mark Monson, Michael Strong, Nic Tideman, Sue Walton, Dave Wetzel. Editor: Jeffery J. Smith Assistant Editor: Caspar Davis Copy Editor: Enzo Piccone Archivist: Stewart Goldwater Owner: The Robert Schalkenbach Foundation Founder: Adam Monroe Send your news and other interesting material to the Georgist News at jjs at geonomics.org or gn at progress.org The deadline for the next issue is July 25. ================================================================== About The Georgist News The Georgist News, a project of the Robert Schalkenbach Foundation, is an email newsletter brought to you free of charge. Its purpose is to keep you updated on the latest news, citations, events, and initiatives of relevance to people who, like Henry George, seek a world free from special privilege and the causes of poverty. Do you know someone who'd enjoy reading the GN? Please forward them an issue and ask them to subscribe, or send us their eddress. As always, it's free. Thanks. The Georgist News is also available online at http://www.georgist.com/ ==================================================================
The Georgist News, Volume Ten, Number One, July 1, 2007.