|Labor Party Minister during 1972-75 said in 1989 that a Liberal Government would certainly complete the aim of some Labor Ministers to sell off the people's bank and airlines to private profiteers. Prophetic words indeed! Labor leaders have lost sight of their Party's earlier commitment to collect the rental value of land, i.e., the value of land minus the value of its buildings and other improvements. Under such a system, farmers and small to medium businesspeople would pay a lot less taxes. On the other hand, the Bonds, and their ilk, would pay a lot more. Labor's 'reform' allowed John Elliot and his rich mates to receive dividends that could reach as much as $2,000 a day free of taxation. What this class of taxpayers now pay in direct and indirect taxation is 'peanuts' compared with what it should be paying for the benefits it gains. -- Clyde Cameron, A.O.|
Continuation of speech given at the official opening of the new Western Australian Headquarters of the
GEORGIST EDUCATION ASSOCIATION (INC.)
at 10 Broome Street, South Perth,
on 31 March 1989.
How many wage and salary earners realise that under our present system of revenue raising, they, in fact, pay exactly the same amount of indirect tax on their beer, cigarettes and everything else they buy as is paid by Alan Bond?
Surely no sane and fair-minded person will argue that that's a fair way of raising revenue! Of course it is not!!
It is little wonder the rich are laughing their heads off over wage and salary earners' stupidity in allowing such an unfair method of meeting the cost of government to continue unchallenged!
But why does a Government elected by the little people of our society persist in compelling their loyal and trusting supporters to pay such a disproportionate share of their earnings towards the cost of Government when there is a better and fairer way of meeting that cost?
The abolition of sales tax and excise duty would lead to a dramatic reduction in the cost of housing, furniture, motor cars, clothing, food and household appliances, etc. Indeed, the cost of nearly every item one buys from the Supermarkets would come tumbling down instead of shooting upwards each week, as is now the case.
And, as the price of items of everyday use fell, rapidly rising inflation would give way to falling prices. Real wages could thus be made to rise by something like 30 per cent with one sensible stroke of the taxation pen.
With the backbreaking burden of heavy income tax abolished, and with the excise duty and sales tax thieves safely locked away in their cells, wage earners would discover that the very much lower rental value of their suburban homes would give a two-fold relief from their current plight. Firstly, the total amount they would pay in rent towards the cost of government would plummet compared with what they now pay in taxation~ and secondly, so would the cost of living.
What this class of taxpayers now pay in direct and indirect taxation is "peanuts" compared with what it should be paying for the benefits it gains from holding exclusive possession of the land sites on which its premises are now situated.
There are other important benefits flowing from collecting the rental value of land. One is that the unimproved value of land can't be disguised or hidden. Another, is that building blocks now held vacant by land speculators would have to be put on the market because the speculators couldn't afford to go on paying the rental value of the land they are holding out of use. The other, is that a valuable piece of land can't be shifted to the Cook or Channel Islands.
Every minute, of every day, the gross in-justices of the present system of taxation is staring us in the face. And yet, we still allow the media barons to blind our vision to a better way of raising government revenue.
However, the good news is that there is a limit to public trust in the media. It can't forever convince the 2.3 million living in poverty that they are well-off. The media can't forever convince the 600,000 who can't find work that work can be had for the asking. And, if we properly present the case for collecting the rental value of land in lieu of indirect taxation and heavy income tax, the media won't be able to hide the truth of what we assert, no matter how hard it tries to do so.
By collecting the rental value of land, we find a form of revenue that can't be passed on to the consumer as is the case with other forms of taxation now paid by Big Business.
Why do I make that assertion? I make it because if a city-based business attempted to pass on its rental obligation to its customers, they would always have the option of shifting their custom to a business address in a lower rental locality; say, in the suburbs.
Indeed, the benefits of rental revenue is so obvious, it is a mystery working people, farmers and small businessmen have taken so long to see it compelling logic.
One-third of our whole workforce is now employed in the Public Service. Many of them are usefully employed; but too many have to spend all their working hours administering a totally unjust system of taxation.
It is sad that Henry George, whose genius gave us the answer to the mystery that causes poverty to go hand in hand with progress, should have used the term "single tax" to describe the collection of the rental value of land. It is amazing that a mind so acute in the areas of political science, philosophy, economics and sociology, should lack such an elementary understanding of words and psychology as to call "rent" and "tax".
No landlord wanting to let a house or home unit would be so silly as to describe his required rent as a tax. That would be a certain way of not getting a tenant! If there is a landlord in my audience who doubts my contention that the word "rent" is preferable to "tax", I invite him to try the following experiment:
Next time he is seeking a tenant, try saying to the applicant, 'I will let you have my premises for a tax of $100 a week; or, if you prefer, you can have it by paying me a rent of $100 a week.' Just try it!
I did and I found an instant revulsion at the prospect of paying me a "tax" for possession of a flat for which the tenant was quite happy to pay "rent".
The rental value of even the most fertile farm lands in high rainfall areas will be infinitesimal compared with a few square metres of land lying in the pathway of the many thousands of potential customers who work or shop in our great cities each day.
When this is pointed out, farmers will then understand that the rental value of a quarter acre of land in the busiest part of a great city would always be many times greater than the rental value of a quarter of a million acres in some parts of the State, or maybe two million acres in the Kimberleys.
Working men and women living in our suburbs, where the economic rent of their various house blocks is quite minimal compared with even one foot of street frontage on which the city's skyscrapers are built, will also see the advantage to be gained by paying the rental value of their land in return for the abolition of today's heavy direct taxation and the even greater benefit that will come to them from the abolition of indirect taxation which they cannot see, but which their pockets feel.
I have said that this elementary truth has been hidden through the brainwashing exercises of the monopoly-controlled media. I have already pointed out that even our Labor leaders have lost sight of their Party's earlier commitment to collect the rental value of land. By that, I mean the value of land minus the value of its buildings and all other improvements.
In fact, both Messrs. Craigie and Huie were continuing their propaganda for social justice when they were nonagenarians. The names of both those men will appear on the Honour Roll which will one day be prefaced with the inscription: "Well done thou good and faithful servants."
In point of fact, Georgists can now say that the truths they promote are beginning to find ready acceptance by an increasing number of people as the failure of current taxing policies become more evident. And, as the country lurches deeper and deeper into the mire created by present day fiscal policies, the correctness of our land policy will be gladly embraced by all except that wealthy and useless minority which is now permitted to grow fat on the misery of the majority.
Speaking of the "majority", brings me to making the observation that it is pleasing to note that Georgists accept as a political reality that the big battalions on election day are those who have always voted Labor. They are the "natural" allies of Georgists because they have most to gain from a return to Labor's former commitment to collect the rental value of land.
Many of the traditional Labor supporters are disillusioned with the policies of the Hawke Government. They are worried by the "rich mates" syndrome that appears to have won more from Labor than it ever got from the Liberals.
In all the years the Liberals were in office they never dared to introduce Labor's dividend imputation scheme under which income received from fully franked dividends are made free of income tax and company tax is reduced to an all-time low of only 39 cents in the dollar. A Liberal Government will certainly continue this aspect of Labor's "reform" to allow John Elliot and his rich mates to receive dividends that could reach as much as $2,000 a day free of taxation.
The Liberals will be quite happy to live with Labor's decisions to have a deregulated banking system, a floating dollar manipulated by foreign currency speculators and a near-record rate of interest.
The Liberals will still allow take-overs to be financed by foreign borrowings with interest payments eating into our balance of payments and pushing up our foreign debt.
When, and if, the Liberal's gain office, we will still have a Government that will allow take-over merchants to charge their interest payments as a tax deduction. There will still be no control over the inflow of foreign money for buying up Australian land, our natural resources and established industries.
There will still be 20,000 homeless children being depraved by drug pushers and sexual deviates.
There will still be 600,000 decent men and women unable to find work; and we will still have 2.3 million of our fellow Australians living below the poverty level.
Under a Liberal Government we will still have our print and electronic media monopolised by Murdoch, Bond, Skase, Lowy and Packer. Executive salaries and Company profits in monopoly industries will still be reaching record levels while real wages of the more useful units of wealth production will be falling with each increase in the Consumer Price Index.
With a Liberal Government, negative gearing will continue to push the price of homes beyond the reach of the ordinary wage and salary earner; and still nothing will be done to come to grips with the spiralling costs of food, clothing and other necessities of life.
A Liberal Government would certainly complete the aim of some Labor Ministers to sell off the people's bank and airlines to private profiteers.
The public is becoming wary of major political Parties which accept large donations from wealthy vested interests. They know that these donations are never motivated by altruism but in expectation of special favour which is usually at the expense of others.
That is why the scene is set for Labor stalwarts, i.e. the ordinary men and women living in their modest suburban dwellings, to demand a return to first principles; the most important of which is to restore Labor's long-held commitment to collect the rental value of land so that the burdens of present direct and indirect taxation can become a thing of the past.
So, having spoken much longer than the time limit I was given, I now formally declare these new premises open for business.
Copyright © 1989 by Clyde Cameron, who should be contacted if reproduction rights are required.
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