• The money-must-grow imperative that compels people to make money in socially and environmentally damaging ways,
• The diversion of economic effort and enterprise towards making money from money and from the rising values of existing assets, instead of from providing valuable goods and services,
• Systematic bias in favour of people, organisations and nations who should be managing the system efficiently and fairly on behalf of all,
• Eroding the credibility of political democracy, and
• Fuelling opposition to globalisation in its present form, thereby threatening world peace and security.
|Fractional Reserve Banking - 'Creating money out of thin air'|
As well as becoming less viable, existing patterns of taxation are now positively perverse:
Common resources are resources whose value is due to nature and to the activities and demands of society as a whole, and not to the efforts or skill of individual people or organisations. The site value of land is the most obvious example. The value of a particular land-site, excluding the value of what has been built on it, is almost wholly due to the activities and plans of society around it. For example, in the UK when the route of the London Underground Jubilee Line was published, properties along the route jumped in value. Access to them was going to be much improved. A public policy decision and subsequent investment of public money, gave owners of those properties a £13bn windfall financial gain. They had done nothing for it; they had paid nothing for it; they had been given a very large free lunch. By contrast, the UK Treasury raised £22.5bn for UK taxpayers in 2000 by auctioning twenty-year licences to use the radio spectrum for the third generation of mobile phones. The governments of other European countries also raised significant sums that way.
"With income from LVT … the government could provide new public transport infrastructure; abolish economically damaging property taxes such as council tax, business rates and stamp duty; raise personal allowances so that millions of lower-paid workers pay no income tax at all; and reduce VAT rates to help consumers and businesses. The tax would improve earned incomes; cut the cost of tax collection; provide affordable homes; reduce urban sprawl; avoid property-led business booms and slumps; and minimise the need for constant changes in interest rates to control land prices"
The state should carry out its three main operational monetary and financial responsibilities in ways that will distribute the value of common resources among all citizens and reduce or even abolish taxes on earnings and profits from providing useful goods and services. This will create a new framework of prices which reward the market economy for delivering outcomes which combine economic efficiency with social justice and environmental care. The state will then be able to let the market economy operate more freely, with less intervention, than now.
Business people and everyone else too, as citizens, will experience greater freedom at the personal level. A Citizen's Income will allow them, if they wish to do so, to reduce the amount of money they must earn by working as employees. Then, with more time and energy to supply themselves and their families with some of the goods and services they now have to buy, they will be able to further reduce their need to spend money if they want to. As consumers, employees and savers they will be in a stronger position to influence - and choose between - the people they have to deal with in those capacities.
Together such reforms offer the prospect of the democratic state performing its monetary and financial functions more purposefully and effectively, thereby being able to allow the market economy to operate more freely. They will also make it financially easier for people to reduce their present degree of dependence on goods and services and jobs provided by big corporations and the state, and for both people and organisations to act in ways that conserve, not squander, natural resources ..."