Full Employment Opportunities at Full Earning Capacity ..Graham Hart
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FULL EMPLOYMENT OPPORTUNITIES
AT FULL EARNING CAPACITY

By GRAHAM HART
Published by THE GEORGIST EDUCATION ASSOCIATION, INC., 10 Broome Street, South Perth, Western Australia, 6151; Telephone (08) 9367 5386 (international +61 8 9367 5386); Fax (08) 9367 4547 (phone first);
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FULL EMPLOYMENT OPPORTUNITIES AT FULL EARNING CAPACITY

This is not an idle pipe dream but is easily capable of total fulfilment, without cost and with enormous savings to the nation.

Politicians are expressing their concern for the disgraceful state of unemployment and various remedies are proposed including an increase in income tax to create jobs.

Man striding to release bull hindered by its own rope "Near the window by which I write, a great bull is tethered by a ring in his nose.   Grazing round and round he has wound his rope about the stake until now he stands a close prisoner, tantalised by the rich grass he cannot reach, unable even to toss his head to rid him of the flies that cluster on his shoulders.

This bull, a very type of massive strength, who, because he has not wit enough to see how he might be free, suffers want in sight of plenty, and is helplessly preyed upon by weaker creatures, seems to me to be no unfit emblem of the working masses.

But until they trace effect to cause, until they see how they are fettered and how they may be freed, their struggles and outcries are as vain as those of the bull.   Nay they are vainer.   I shall go out and drive the bull in the way that will untwist the rope.   But who shall drive men to freedom?"   (Introduction to Protection or Free Trade, 1888, by Henry George.)

The gibberish published in the newspapers is confusing and deceptive otherwise it would not have appeared in the columns of the 60% media monopoly press.

There is not one single reference to the basic cause of unemployment.

All forms of employment arise from labour of hand and brain, applied directly or indirectly to land, which is the source of all wealth and the field of all human endeavour. This is not in dispute.

To provide full employment, therefore, it is necessary to liberate the land from monopoly and remove all the impediments from labour and the organising of employment.

The task of ensuring full employment opportunities is very simple in Australia, the lucky country, because, -

We have an enormous land mass,

About the lowest population density in the world,

Are ideally suited to growing food and clothing materials,

Have a temperate winter climate and a reliable rainfall,

Forest land and soils, ideally suited to the production of building materials abound.

We have almost every known mineral available, including oil resources, with abundant sunshine for collecting solar energy and -

An enormous coastline yielding more than ample marine life in return for the minimum effort.

Full Employment Opportunities at Full Earning Capacity _Graham Hart

How we have used our abundant resources is revealed in grim statistics:-

l. About a million people are unemployed - including about 30% of our young people.

2. About a quarter of our people live in poverty, which is the basic cause of broken homes and homeless people.

3. l0% of the potential workforce live in luxury, from the labour of others, because they own 90% of the land value of Australia and levy tribute from the rest, who own only l0% of the land value.

4. We have a national public debt of about $l30 billion (including all tiers of government) passed on immorally to our children, - taxpayers of the next generation.

5. We tolerate adverse trade balances.

6. Our currency has been inflated about hundred times in the past century (precise statistics are not available.)

7. Only about 60% of the eligible workforce is engaged in productive work or in rendering useful services, inclusive of working mothers of young children.

8. We have employed about four times as many civil servants, per head of population, as Japan.

9. We have imposed about four times as many new laws and regulations as in the U. K. or Canada, mostly in support of a vicious taxation system or of a restrictive or palliative nature. This is a bonanza for lawyers and accountants. The law has become so complex that consistent opinions and rulings from lawyers and judges are rarely forthcoming.

10. Sales of Australian land to foreign nationals are increasing, largely because of their stronger currencies.

11. We have one of the highest abortion rates in the world despite a population in which natural increase is declining. It is maintained by immigration with preference to those of non Anglo-Saxon Celtic origin.

12. Production costs are artificially increased by taxation and regulations between 20 and 40%, which makes Australian primary products and manufactured goods marginally uncompetitive in world markets.

It is a miracle that the economy has survived at all under such conditions which speaks volumes for the fibre of our people.

Many Australian firms have been forced into insolvency, others have transferred their operations overseas.

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The million dollar question is, - "How can full employment and prosperity be restored to the people of Australia?"

With such a record of mismanagement, this would seem to be almost impossible.

In reality it is quite simple, - the world is governed by science, - the physical sciences, which are highly complex, controlling the production of wealth and the abstract science of political economy, which, by comparison, is the essence of simplicity, controlling its distribution.

Ethical conformity with the science of political economy is all that is necessary to correct the maldistribution of wealth which is the cause of all our problems.

The natural distribution of production is -

l. To site rent for the use of land and the environment exclusive of man made improvements

2. To wages in return for labour in all its forms, and,

3. To interest for the hire of capital.

All returns are assessed competitively by the free market and not imposed by governments.

Land is a free gift to all people by the Creator - it has no cost of production.

With the advent of people and the pressure of population, land develops locational advantages, which increase with proximity to the centres of population.

There is an enormous differential from zero in marginal land in outer regions, to about 8 million an acre, annual rental value, in the heart of Sydney.

This value is people value. If people move from one area to another the land value will transfer with them.

Value which arises from the presence and activity of all the people as a community, surely belongs to the community and is the natural source of public revenue.

When the unimproved site rental value of land is taken for public revenue, it does not pay to hold land idle or under developed. It must be put to use in order to earn the public charge.

This ensures full employment opportunities because land can only be used by people being employed.

When rent is not taken for public revenue on behalf of the people who have created its value, land becomes the subject of monopoly and speculation.

Full Employment Opportunities at Full Earning Capacity_Graham Hart

Economic rent, as it is called, is capitalised as land price at about twenty times the rental value. This imposes a further penalty on potential land users, most of whom must borrow funds to gain access to land.

Land monopolists have surplus assets and are willing to oblige in return for interest payments.

When better land is held out of use labour is forced to use inferior land which reduces wages.

Natural wages are determined by what can be earned from the least productive land in use - which explains why wages are much the same, irrespective of the value of the land being used.

Rent arises because the efficiency of labour is increased where better land is used, ensuring that all who engage in production do so on equal terms - a fair field and no favour.

The total land rental value in Australia is about $60 billion per annum, which is adequate for the necessary functions of government.

When taxation is the source of public revenue, this bears as a fine imposed on those who produce, exchange, invest, or consume wealth, which discourages production so effectively that recourse to borrowing and inflation becomes necessary.

Moreover, at least double the rent fund is necessary when public revenue is raised by taxation, necessitated by the social evils generated - for welfare services, dealing with crime, murder and suicide arising from injustice, enforced idleness and temptation.

The suicide rate of those who have lost hope of ever being allowed to live a normal life is now in excess of deaths from road accidents - governments are responsible.

The proposal to impose a special tax to create jobs is surely not intended to be taken seriously.

Jobs cannot be created by transferring funds from the private purse to government. At best, this will only generate temporary useless jobs at the expense of useful, private, employment. Moreover the point has now been reached at which higher taxes yield less revenue, so the job creation funds must be borrowed or inflated.

Politicians know that depressions come in cycles which force a temporary reduction in land prices and so aid recovery.

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For this reason they talk of 5% to 7% as an acceptable level of unemployment—not full employment, because the policy of all political parties is—NO INTERFERENCE WITH THE UNEARNED INCOMES ARISING FROM LAND MONOPOLY AND SPECULATION. Mates wouldn’t approve, and would withdraw their financial support from political parties.

Although the people are kept in ignorance by indoctrinated public education and the media monopoly, government and politicians generally are well aware of what if going on.

They have been informed continuously for more than one hundred years by the worldwide Georgist movement how to create a fully-employed and prosperous society.

Progress and Poverty, written by Henry George in 1879, has become a world best seller in its class, second only to the Bible, and has been translated into about 20 languages. It is available in all the best libraries.

In conclusion, our simple proposals are restated as follows:-

1. Collect socially-generated economic rent as the main source of public revenue, supported by:-

(a) Competitively-assessed royalties on the controlled extraction and marketing of non-renewable resources, mainly applicable to mining, and,

(b) Competitively-assessed licences issued for the exploitation of renewable resources where this is necessary to ensure conservation and regeneration—applicable mainly to timber resources and marine life.

(c) Minimum consumption charges for reticulated services, sufficient to prevent waste.

2. All taxation on production, exchange, investment and consumption to be abolished, together with monopolies and sinecures.

3. The confining of government to functions which by their nature are necessary monopolies, in which competitive free enterprise cannot function efficiently and in the national interest.

4. Democratic electoral procedures by Proportional Representation (Hare-Clark system) with the Cabinet similarly elected by all members of parliament, and for local councils, similar to the Swiss system but without the Party List system.

The foregoing proposals to be phased in progressively.

Results however would be much faster once land speculators came to realise that there would be no future unearned income arising from their antisocial operations

This was the experience in Denmark.

There are only seven laws in the science of political economy. These are self evident once attention is drawn thereto and can be memorised in a few hours.

Full Employment Opportunities at Full Earning Capacity_Graham Hart

THE LAWS GOVERNING THE SCIENCE OF POLITICAL ECONOMY

1. The Law of Motivation

All people seek to gratify their desires with the least exertion of physical and mental energy, i.e. with the greatest economy of effort.

2. The Law of Rent: The rent of any area of land depends upon the excess of its produce or satisfactions which can be derived from the same application of labour and capital compared with the least productive or desirable land in use; (rent free or marginal land.)

Because people cannot live without access to land, this is the most important law in the science of political economy. When some valuable land is held out of use labour is obliged to use inferior (sub-marginal) land which yields a lower return.

3. Law of Wages

Wages depend upon what can be earned, or satisfactions derived, from the least productive or desirable land in use, (rent free or marginal land) after payment for the use of capital.

4. The Law of Interest

Interest depends upon what can be earned from the use of capital, after the return to labour, from the least productive or desirable land in use (rent free marginal land.)

5. The Law of Supply and Demand

This law relates to value in exchange. It fixes values and registers prices; is an indication to wealth producers where production for different commodities is most economical and the extent of demand.

Value, determined by the operation of the law of supply and demand, depends upon what is agreed upon by prospective buyers and sellers in an open market, in which none of the parties to a transaction is under duress.

This definition would apply in a free economy, but under present conditions, value agreed upon is influenced by land monopoly, taxation, secondary monopolies, poverty, unemployment, artificial price fixing and every form of social disorder, the net effect of which registers exchange value under the conditions which apply.

6. The Law of Diminishing Returns

This law has not been precisely defined. It means that because production costs are reduced by specialised effort and the concentration of labour and capital, it does not necessarily follow that an increase of such will continue to cheapen production indefinitely.

There is a point of optimum efficiency, at which the most desirable results will be obtained.

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7. The Law of Human Progress

Fraternity in freedom, with equality of opportunity for all people to apply their exertions to the God-given, freely provided, resources of nature, is the writer’s definition.

The Golden Rule, "To do unto others as you would that they should do unto you," means exactly the same thing, but the precise conditions are not stated.

The common law of England was based on the Ten Commandments.

There are about twenty texts in the bible simply defining human rights and the ethical conditions of land tenure, - the Church* is silent presumably for the same reasons as are politicians.

GEORGIST EDUCATION ASSOCIATION INC.,

10 Broome St., South Perth , Western Australia 6l5l

Telephone 09 367 5386

World Wide Web: http://www.multiline.com.au/~georgist; E-mail: georgist@multiline.com.au

*The Christian Church, Land, and Politics available on request.     January l997

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Full Employment Opportunities at Full Earning Capacity_ Graham Hart

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