Conversation with Georgists; 8

Exploring the ideas of protection free trade wages taxes automation and unemployment. These are just some of the topics to be heard on. Conversation with George's produced in cooperation with the and rejoined school of social side. And now we're here is your host for a conversation with Georgia. The faculty of the Long Island extension of the Henry George School of Social Science a school devoted exclusively towards stimulating an interest in economics and the dissemination of the philosophy of Henry George through free courses in economics welcomes you to the eight in a series of programs dealing with the subject of

economics. It is our hope to clarify and elucidate upon much of the vagueness that besets this all important area an area which affects all our lives. We feel that economics is everybody's concern regardless of sex profession education or occupation. This program conversation with George's deals with economics in this vein and we hope to bring forth some answers to the current problems that face our nation and the world. My name is Stan Rubenstein director of the Long Island extension of the Henry George School and with us tonight are three members of the faculty of our school. Each one well-versed in the field of economics. Having spent many years teaching our free courses in EQ economics. Mr Gerry Schleicher Mr Wayne Barry and Mr George Silbermann have been with the

school for a number of years. Our subject for tonight deals with monopolies and gentlemen I do not mean the game that's put out by Parker Brothers. It seems that whenever the subject of monopoly is discussed most economists view the subject quite differently. Then do the followers of Henry George. Historically whenever this government sought to curb monopolies as they did during the 1890s with the Sherman Antitrust Act and as they did in 1914 with the Clayton antitrust laws they invariably dealt with businesses dealt with industries dealt with frost dealt with different forms of capitalists and yet when you speak of monopolies and when I say you I mean the followers of Henry joyed speak of monopolies. It is by and large land

that you are concerned with. So it seems we have a need economy. This whole concept of monopolies between most modern economists and the followers of Henry George I hope that we can explore this issue tonight and perhaps come out with a clearer definition of what we mean when we speak about when our police and if monopoly is an evil then I think it warrants our investigation more thoroughly. Mr. Wayne Barry why do you feel that a land monopoly is the one causing the greatest economic maladjustment in our society today. Well the land monopoly is the basis really for which other monopolies stand on land. We should realize as Henry George pointed out and he means by land not just land but all natural resources. It is the

foundation or the primary factor in the production. Without land you can't produce any better wealth and because of this fact whoever controls the land are really the landlords. They hold the destiny of man. And when we realize in this country that only a very small portion of the population holds the 90 90 something or 98 percent of the valuable land in this country and we realize that this land monopoly is as it is more than just a game at sea it's the thing that sets holing up. It's with things as producing slums as we go into all kinds of our economic woes as all comes back to this land monopoly and the other monopolies that you mentioned are.

That they seem to be grappling with and arguing in the courts. But they just leave this land monopoly alone and seem to it. Nora I don't understand it. And it's true that those that hold those valuable land in our country with its natural resources or or land in Manhattan Island the richest man in the world. They are the ones that are. You might say he is holding this straw strangling our society by not allowing people freedom of them to go up on the land their land and produce when they want to produce wealth. That you were trembling before you would mention poverty and certainly poverty is one of the major concerns in our country today as it is throughout the world. Are you attributing poverty as one of the economic maladjustment you attributing urban blight and everything that goes along with many of the areas where we

have dislocations today are you attributing this to land monopoly and not to other basically other causes. As as many economists say today. Right. Basically all of the poverty is due to the monopoly of land the land monopoly makes the rich richer you might say and the poor poorer. JERRY Perhaps we can continue along with this line because I think that for many of the listening radio audience that we have when you speak about land monopoly I think the tendency would be to give some adjectives in front of a name and say well they're pretty old fashioned I mean this may have been you know the make Question at this. This may have been true during the 1880s and 1890s when Henry George lived and when he ran for the mayor of New York and he was one of the great popular spokesman

at that time. But would you say that land monopoly today present year is a is the greatest economic maladjustment. I feel strongly that is true and I would like to draw this mental picture of what the production of wealth means. I picture the producers of wealth. Each minute producing some sort of wealth. And at the end of the day adding it up and sort of the end of the week taking stock of all the wealth that they produce. Taking it on their back and going up over to an open field. A man stands guarding his open field he checks in the wealth that the producer has made and gives him a receipt which is money. Then the individual goes around to the other side of fear over another individual standing and he presents his receipt. His money and he is allowed to pull out of this great man a world that is built up by other producers

have also come and he takes out of that mountain of wealth. A certain percentage minus the cost of operating this open field the marketplace. The next group of people that come are the army and navy the people that protect us. But they have no welfare on their back but they also go around and they have receipts that were given to them by the producers of wealth. Whoever that may feel that they want to go because they are performing a service. We have other people doctors attorneys barbers and so have you. These people do not bring wealth. Now what I mean by the monopoly of wealth I say of a monopoly of land causing such a dislocation is the next group of people that come to this mound of wealth are the owners of natural resources they have nothing on their back and they have given no service at all except allow the producers of wealth to use the natural resource. Now they also go around to the back and pull out to the extent of the receipts that they hold a portion of the

wealth. Now the question is this. How much do they take out. Now if they can take out to an extent that causes the produces a route wealth to realize that they're not getting at least as much as they're putting in then the producers of wealth will cease to produce wealth and the general depression will start. Now if we do not stop this tendency then we must face the recurring. Right down our industrial capacity to produce well and see this happening over and over again. That's why I say this monopoly of land is so important. We must stop in and then the question of how do you stop it. We are at a Georgia school and Georgians feel a lot of we tax land values and remove the tax burden from the producer well so the great advantage that accrues sitting on as a natural resource is removed a lot of it is a wealth to keep what it produces that we can stop this break before going into this this this whole entire area which I know is

quite fundamental with the followers of Henry George the single tax the tax on land value. I'd like to stick a little bit more to this land monopoly that you speak of and the explanation that you gave is an explanation I gather for what is it that causes depression is and what is it that causes recessions and you feel that by the land owner taking out x amount. Dollars or part of the wealth Paul II. This of course means that others get that much less. And yet I still cannot help but thinking and I try to think of people living in many areas of Long Island in New York City and I'm sure in most of the major cities throughout the country. Ah there are a few people that own most of the land is this what you mean by a land monopoly. I know that when we speak about

land monopoly and when the government speaks about monopolies in industry they speak about a particular industries such as Standard Oil going back to the latter part of the eighteen hundred early part of the 1900s. They speak about a group of men that were able to control almost the entire oil industry. You know now when you speak about land monopoly are you speaking about several people that control a major segment of land in the United States Gerri. Well I would say there are many people who own land. Now the question is which is more valuable I'm not talking about an individual that owns 10000 acres in the Arizona desert as compared to somebody who owns an acre of land on Thirty fourth Street and Fifth Avenue. I would much rather have that I want to make it at 34 than Fifth Avenue and a hundred thousand acres in the Arizona desert. Evidently the location is important. The

type of land what is underneath it is important because this is what the producers of wealth will will agree to give up a greater part of our wealth. For now when the individual land owners now you mention Standard Oil. And most people think a monopoly such as Standard Oil is a producer of wealth and therefore they can control so much oil that this is what I'm driving at. That is not so. If I own the oil in the ground. And you own all of us so as to produce oil. I would much rather own oil all the oil in the ground because I am in a stronger bargaining position. You can't produce oil until I give you the natural oil in the ground. Then when you speak about Standard Oil or when you speak about any particular manufacturer that isn't gauged in the in the basic industries you know obtaining the natural resources whether it's coal oil aluminum or any of your other metals. Then do you make a distinction between

as as a company that use standard oil as being on one hand a capitalist or an industrialist and on the other hand as being a land owner. Absolutely In other words you find it above and the same. An industry that can be monopolized can only be monopolized if they can control not only the productive capacity but also the natural resources because if they cannot control the natural resources then they cannot control that industry because other people will come in and start producing. Then I would gather that you recognise and I know I can see the difference here the dichotomy of opinion in the Henry George thinking concerning land monopoly and monopoly when it comes to business. That in many cases these particular manufacturers of these particular catalysts are also land monopolies. Absolutely in fact if you examine the so-called 400 of those countries. Read some more about the history of where their fortunes came from. You will find surprisingly enough that not only are

they engage them out of fracturing wealth but very often in fact most often like they are own natural resources and this is what they build their great capacity to produce wealth on. I'd also like to clarify another point that you would mention and I think this is worthy of clarification when we do speak about what is meant by a land monopoly. You are speaking about a land monopoly as an acre in Thirty fourth Street as opposed to 10000 acres out in Arizona. When you speak about an Apple IIe as a qualitative not quantitative for example. Somebody may control one half of a block in New York City and the effect that that person may have on the economy may be as great or greater than the fact that someone else would have as a result of his monopoly owning 10000 acres in the Arizona desert because actually why. Why that is true Stan is that you're talking about land and people. If there are no people on

the land there is no monopoly of people don't want that land or cannot use it then there is no monopoly. It is when people must use that land or must stand on it or must begin it. Now if you can control it then you can determine just who gets what part of the pie. Because you are in a much stronger bargaining position. You can go to Florida and not produce this year. Labor must produce that I because if it doesn't you can make it up tomorrow. OK now continuing along these lines now I'm just trying to think right now the policies that the government has with respect to monopolies and the. Thinking that you people have with respect to monopolies. If we were to abolish all monopolies other than land monopolies because it seems that our direction is not focused towards land monopolies in our economy today it's focused in every other direction it's focused concerning monopolies and labor. We have groups of people about suggest that labor itself represents a

monopoly and of course we have on the books as mentioned before many monopolies that are being investigated concerning industry. If we were to abolish all monopolies other than the land monopolies what would be the effect on the distribution of wealth. Josh Silverman. Well it would be true to a negative in the and at the offset they would be a benefit to labor. And to Capitol However as as time progressed the landowner would charge more rent for his for the use of of the land and the value of the wages would therefore go down. It would seek its own level again. Same thing with the capitalist

who has invested his money in the in the particular monopoly in the beginning he would be able to and more interest for his money invested. As time went on it would seek the interest level would be a lowered. The difference would be going to the landowner. Now the question the question arises as through a recent recent request by five major rarer ways in the West to who can to consolidate its appears that they were losing money or they claim that they were losing money and B the story went before the ICC the ICC wanted to know who where this money was going to or the fact that. According to

two business reports these railroads were making an awful lot of money they were paying taxes on an awful lot of money. The railroads the railroads as a result would not divulge the ownership of the railroads to the ICC or to any other government agency. It appears that it was tied up in the mess of a quasi government excuse me quasi business intrigue. Stocks were were in trust with various stock brokers who would not quote not divulging the ownership of the railroads. Now although on the balance sheet the railroads claim that they were losing money they were making more than twice their loan they were

making above twice their loss. As landlords I don't like owners of the land. I know what what you speak of jobs historically has a lot of merit and a lot of truth. I know that during the 1840s and 1850s this is just about the time with the advent of railroads of the United States government wanted to encourage railroads from building and moving westward so that the hope was that the population would also go in this direction and this would be beneficial etc etc to the economy and to the country as a whole. And there have been a number of reports by people that have studied this particular area stating that many of the railroads made as much or more money. As land owners that is actually

capital is being engaged in the transportation business you know with with the trains. And this would seem to coincide with what you are currently speaking about as far as much profit that is being the Rive by someone as I mentioned to Jerry before we have to break down the railroad owners. Number one as a capitalist as a mover of trains as you know everything that goes with it. And also as a land owner and of course the difficulty that we have in our economy is separating one from the other because we usually wrap them into one package. So therefore we capitalised to many times in a negative sense when in reality if we were to examine it closer as you even suggest here it may be that we are. We should be looking at the land owner not as a capitalist accomplices Jerry mentioned serves a function a landowner.

While he seems to take only from the from the wealth pie but I'd like to pursue this more with with Wayne. This whole concept here of monopolies I know that it's the government class that an industry has a monopoly and something they break up the industry and it may very well be conceivably. But I think break it up into different parts. Well now how do you break up a land monopoly. I mean what do you what do you do what are you suggesting that everybody gets an equal share of land and this is your remedy for correcting this economic maladjustment Wayne. No we don't want to try to break up the land and yours points out that it's not necessary to break the land monopoly to do that is merely necessary. Change our taxation system with regard to

raising money for the government and that the government should just collect a tax based upon the value of the land whether it's natural resources whether it's site value and that way they were will break the monopoly because people now are hauling the land out of use you might say and holding back natural resources knowing they'll be higher next year than they will this year which makes it difficult for people to produce it there have the natural resources held back as there's land that your tax base in that Yards advocates this will definitely break up their land monopoly to everybody's benefit because the services that the taxpayer pays for helps to build the land value was higher and a monopoly of land on the land owners get all this today. If we could only give that back to the people that produced it. Instead of letting the landowners collect in their own pockets whether it's a royalty of for oil or

for sight value to this man via taxation that George advocates land monopoly will just disintegrate. Wayne when you speak about this land value taxation as being a way of doing away with monopolies does that mean that in a lot that I own 70 by 100 feet that I'll be paying a certain tax and somebody on Thirty fourth Street will be paying the same taxes that I pay. No it's it's based on its location as Gerry pointed out. Location is a principal thing with foresight valueless. Where population is and that will be it's on the market value of that site will determine. You mean that value is different according to where any particular piece or plot of land may be. That's right. I mean that the further away that one gets from a city for example Jerry had mentioned before ten

thousand eight is in in Arizona that it may be that that those 10000 acres may be worth several cents an acre. As opposed to the value of an acre in New York which is valued at millions of dollars. That's right I think that the game Monopoly you mention before will point out to those that have played at the value of the corner sites and they where the hotel has to be or what other. Stores schools or wherever people want to have an a center of population and the day a schools go out the city or small town is gonna buy land for a new school today it's a taxpayer has to pay a terrible price to get it and that that was never done anything to increase it himself. If the people in that location that have paid their taxes to all the services lights and hardened streets whatever gives value to Iran.

Now wait what do you feel would be the effects if you were to do away with land mine nobly. Well it would definitely improve the production and everybody's wages would go up but relatively there'd be actually people would be getting exactly what they are producing and the landowner wouldn't be dipping into the pie and taking something for nothing. Jerry what would this do and the last moment to that we have what would this doing away with this land monopoly for example to our taxation system. Well to begin with that we find that the producers of wealth pay taxes twice as much as the non-producers a speculator twice as much for 30 percent as much because a man involved in buying land and hauling as investment gets a long term capital gains whereas a producer working day to day has to pay taxes on a regular basis. And if we can get rid of this why then we can put has put us on a more equitable basis.

All right. I really hate to interrupt you at this time but once again as I look at our studio clock I notice that our time is up. I wish to thank Mr. Gerrish lika Mr. Josh Silverman and Mr. Wayne Berry for appearing tonight on conversation with Georges. Henry George School welcomes the opportunity to send a booklet about tonight's program to any interested listener or if you wish to find out more information about our frequences in economics. You may do so by dropping a line to the Henry George School post office box 54 Old Bethpage Long Island that address again is the Henry George School Post-office Box 54 Old Bethpage Long Island.

Exploring the ideas of protection free trade wages taxes automation and the unemployed. This has been a conversation with Georgia. Produced by W. DHC office for University in Hempstead in cooperation with the resort School of Social Science. This is ne our last little educational radio network.