TP25. Radio, Fish and Cyberspace: land in the contemporary world.

 Sometimescompletely new problems arise, which demand solutions. When people face these new problems, important light is often cast on much older problems. A number of developments in the past century or so have cast light on one of the oldest of the political and economic problems, but one which is still very much with us: who should own and control land, and on what terms.

Radio and television

When sound broadcasting began, it was soon realised that different radio stations on similar frequencies interfered with each other’s transmissions. It became necessary to allocate particular frequencies to particular stations on both a national and an international scale. When television arrived on the scene, similar problems arose. National and international arrangements had to be made allocating particular frequencies to particular countries and companies. When these claimants were countries, there was some agreement between them, which all more or less accepted. When the claimants were privately-owned companies, they were usually required to pay the rest of the community for their franchises. In other words, when somebody sought a monopoly of a natural resource – in this case, natural radiation – it was universally agreed that it was reasonable that payment should be made for the privilege.

Air travel.

Radio and television wave frequencies are only one example of instances where what had once been a great unexploited “common” had to be divided between claimants who were expected to pay in some way for their share. Air space is another example. When air travel began, it was largely a matter of everyone for himself. But as time went on, flights in and out of airports became numerous, and it was soon accepted that the allocation of space and time to particular individuals or corporations was a matter of public policy, for which either there must be genuine agreement between all claimants, or, in default of such agreement, beneficiaries could reasonably be expected to pay.

Fisheries

Fisheries have presented a comparable problem. Once the open seas, beyond the three-mile national limits, were open to all who cared to fish in them. Now increasingly powerful ways of catching fish have been developed, and increasing numbers of people wish to eat fish, with the result that popular kinds of fish are becoming scarce. It has been necessary to make both national and international arrangements to regulate use of the ocean, once the biggest “common” of all, and again it has not been considered wrong to ask for beneficiaries to pay for the privilege.

Other cases.

One can think of various other examples where what had once been a “common”, available for all to use, has been restricted by government or inter-government action. Once, people were largely free to eject effluent – solid, liquid or gaseous – from their homes or factories, and the main legal constraint was that somebody who suffered as a result could seek redress against he person doing the damage. Now there are a great many legal restrictions on that sort of thing. Many problems affecting cyberspace are arising through the widespread use of computers and the internet.

The principle

All these examples bring out the same point. When some natural resource is available in more or less limitless quantity, and there are few people who wish to exploit it, there is no need to restrict access to that resource. But when claimants to the resource become numerous, allocation is necessary. If that can be done by genuine agreement between interested parties, that is fine; but where there is no such agreement, the best thing to do is to arrange for thosedesiring some special right to pay the community for the privilege.

Land

All of these examples refer to natural resources which were once available for all to enjoy, but where developments in the last century or so have made it necessary for new rules to be made, allocating the resource to some particular claimant. There is a very much more ancient example of the same problem, which is still not satisfactorily resolved: the land surface of the earth.

      Most of the earth’s land surface which is useful for agriculture, industry, leisure activities or residential occupation is divided between various owners; but the division is, to say the least, eccentric. Some people own enormous amounts of it; a great many people own none at all.

      But without access to land, nobody can live. Furthermore, there is no way of increasing the quantity of land. So people who own no land, or very little land, are compelled to pay those who do own land – whether in money or in labour – for the privilege of access to it. Here is the root of the enormous gap between rich and poor which has been observed throughout history. As other Topic Papers in this series show, here also is the root of a large number of modern problems: unemployment; booms and slumps; many housing difficulties, and many environmental problems.

Drawing the lessons.

So why not apply the principles which we apply to the various new problems to the much older problem of the land surface of the earth? If some particular individual or corporation wants special rights over “land”, to the exclusion of the rest of us, then surely it is reasonable to ask him to pay for the privilege? The best way of doing this is by what is called Land Value Taxation, or LVT.

      Other Topic Papers explain more fully what LVT would entail, but we may sum it up briefly. All land in the country would first be valued. The value of the site alone would be considered, and would exclude the value of “improvements” put on it by human agency, like buildings or crops. Then a tax would be levied, related to that valuation.

      Another tax? No, LVT is not an additional burden on the taxpayer but a replacement. As the revenue from LVT increased, other taxes like income tax or VAT would be reduced. The big difference betwen LVT and other taxes is that LVT collects revenue for a natural advantage which the owner has not created, while the other taxes collect revenue for what the taxpayer has done, or wants to do.