By George! Austin Leads National Recovery

It’s a wistful headline, I admit. But it covers a considerable hope.

The Austin-Round Rock metropolitan area was nearly alone among USA cities for its ability to report year-over-year job growth in April, 2009 (up by 3,400 jobs). And it was the only major metro area (out of 38) to report an increase in the employment rate (+0.4 percent). To believe that this slim green shoot is the first sign of economic Springtime in America requires a bit of the Oat Willie determination to go “Onward thru the Fog.” Which, actually, is what I intend to do.

But first a note: more notice should have been given to Odessa-Midland which, unlike Austin-Round Rock, gets split into two separate metro areas. Odessa employment was up by 1,800 over the year, while Midland was up by 1,500. Why these sister cities don’t get hyphenated into a single metro is curious.

Still, these Texas numbers look like boutique novelties in a warehouse of national economic crisis. The volumes are crushingly large. Los Angeles has lost 240,000 jobs, the New York metro area is down by 234,000. Chicago down 190,400, Detroit down 143,400, Phoenix and Atlanta down by 129,700 and 123,600.

How all these jobs will get re-started is not easy to see. Where are the new paradigms of labor to come from?

Stock watchers are reading reports about large dollar supplies stored up by investment managers and standing ready to flow back into a wary market of stocks and bonds as soon as things get more steady. But the dynamic reminds me of Truman’s exhortations on fear. Don’t things continue to fall harder the longer the investment managers wait?

In some circles one hears a constant drumbeat for buying gold, which may be a way to own something that won’t crash in value this year. But what use is gold, really?

In the great classic of American political economy, Progress and Poverty, Henry George defines capital as that part of wealth which is put back into productive use. He encourages a view of capital as something which enables labor to be more productive and he therefore discourages taxation on capital.

Taking a Georgist view, I would think that gold is wealth that serves very little productive purpose. To the extent that gold is a way of holding some savings for retirement or rainy days, I don’t see how it should be valued much differently than any other form of savings.

But to the extent that gold is hoarded up as a pile of fear, doesn’t it become its own effect, pulling wealth out of productive equity investments, drying up more jobs, etc.?

From my armchair view of internet chatter, it seems to me a wise thing for policy makers to devalue the dollar in the near-term as a means of coaxing cash into markets. But if devalued dollars simply get transmuted into gold shares, then the alchemy gets dark.

A Georgist approach to systemic reform begins with tax policy. Capital and labor should be taxed last. Then property values should be clearly divided between improvements and the land they rest upon. Let the improvements also move to the back of the tax line. This leaves land value at the head of the line for taxation.

George’s reasons for land tax could be summed up in a Kudlow motto: “tax it and you get less of it.” But with land, there is no danger of taxation reducing the supply, there is only the promise of land monopolists unloading every acre that they are not already putting to productive purpose.

Thus, under the Georgist model, the land tax — as the only tax — could never result in an absolute decrease in land supply. The land tax would only tend to decrease the amount of land that is held, like piles of gold, for unproductive use. As for gold and other means of piling up unproductive wealth, I can’t see right away why a tax on such things wouldn’t hasten the development of a more productive economy for all.

George says that supply and demand are misleading terms to use when trying to understand the causes of the unemployment cycle. Workers are not quitting their jobs because they have earned all they need. They are not refusing to produce or to consume. We never have all we want, and the example of Austin in April proves that we are ever willing to earn the next leg up. So why do so many workers find themselves at massive rates closed out of productive opportunity?

The problem lies at the door of unproductive wealth, because there is still plenty of it. Yet for some reason unproductive wealth is encouraged and allowed to pile up, even sometimes as an excuse for “real value.” If we taxed land, unproductive wealth, and gold supplies, I wonder, wouldn’t we quickly motivate and incentivize tons of wealth into capital that would eagerly call for full employment now?

Greg Moses is editor of the Texas Civil Rights Review and a member of the Texas Civil Rights Collective.. Read other articles by Greg, or visit Greg's website.

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  1. Deadbeat said on June 5th, 2009 at 3:32pm #

    Reading Moses’ piece, there is too much emphasis on a land tax as a cure-all. However later in his piece he says the following…

    The problem lies at the door of unproductive wealth, because there is still plenty of it.

    Thus let’s assume then what is meant by the “land tax” is a wealth tax. If Moses is advocating a wealth tax as in an estate tax and taxing unearned income (such as stock transfers) then clearly I’m in agreement. But if the meaning of a “land tax” is taxing solely land then there will be a whole heap of loopholes that will allow taxes to escape.

    Moses rhetorically ask …
    So why do so many workers find themselves at massive rates closed out of productive opportunity?

    His answer…
    The problem lies at the door of unproductive wealth, because there is still plenty of it. Yet for some reason unproductive wealth is encouraged and allowed to pile up, even sometimes as an excuse for “real value.”

    But what Moses fails to analysis or perhaps remember is that the Capital Gains tax rate was once upon a time at a rate of 50% or higher. In other words a 15% Capital Gains tax rate didn’t happen “organically” it occurred via REAL POLITICS. The FIRE sector power grew as the power of labor weakened. Moses offers no strategies to rebuild labor power. In fact Moses doesn’t even address how the “unproductive” sector grew to such enormity on the backs of labor.

    Also another problem with the “land tax” and placing “capital” on par with labor is that the “productive” sector is an extremely EXPLOITATIVE sector. Here Moses quotes of all people Larry Kudlow, a Reaganite, …

    George’s reasons for land tax could be summed up in a Kudlow motto: “tax it and you get less of it.” But with land, there is no danger of taxation reducing the supply, there is only the promise of land monopolists unloading every acre that they are not already putting to productive purpose.

    This reasoning is clearly false because during the 1950’s when the U.S. was at the height of its productive capacity the top income tax rate was 91%!

    What occurred during the past 30 years has been a shifting of the income tax burden onto the working class. The fact is that PROGRESSIVE taxes are a CHECK on Capitalism. Capitalism itself is extremely redistributive toward those who have capital — PERIOD. The problem is that the working class has been INDOCTRINATED into believing that Capitalism is the only possible way to configure an economy and has been convinced that “more” Capitalism the better. This is an outgrowth of Cold War indoctrination as well as 30 years of cultural Reaganism which is best represented by Larry Kudlow.

    What is “ill-dissident” is the notion that there is some “add-your-prefix-here” Capitalism. There is only one form of Capitalism that is for wealth to accumulate to capitalist at the expense of workers. Progressive taxes are a way to CORRECT for this exploitation — the flow of wealth from workers to capitalists that naturally occurs in Capitalism.

    Thus what is needed today is accurate analysis of the situation and real solutions — not gimmicks. Gimmicks only waste precious time and resources and deceptively diverts the public into “easy” solutions that in the end will maintain the Capitalist class who will eventually unravel any reforms. Thus Georgism appears to be Liberalism all over again.

  2. Greg Moses said on June 5th, 2009 at 8:13pm #

    “I am inclined to think that the result of confiscating rent in the manner I have proposed would be to cause the organization of labor, wherever large capitals were used, to assume the co-operative form, since the more equal diffusion of wealth would unite capitalist and laborer in the same person. But whether this would be so or not is of little moment. The hard toil of routine labor would disappear. Wages would be too high and opportunities too great to compel any man to stint and starve the higher qualities of his nature, and in every avocation the brain would aid the hand.” Henry George. Progress and Poverty (Book IX, Ch. IV, p. 468).

  3. Deadbeat said on June 5th, 2009 at 9:42pm #

    I don’t understand why Mr. Moses wants to resurrect Henry George and re-debate his efforts that was debated over a century ago. We should be learning from history rather than repeat the mistakes of history. Rather than me respond to George’s words I rather leave that to Karl Marx. Here is a link to Marx’s critique of Henry George.

    Here is what Marx’s has to say about George…
    * Theoretically the man [Henry George*] is utterly backward!
    *[George’s] fundamental dogma is that everything would be all right if ground rent were paid to the state. … This idea originally belonged to the bourgeois economists ; it was first put forward … by the earliest radical followers of [David] Ricardo

  4. Max Shields said on June 6th, 2009 at 6:28am #

    Deadbeat, Who the f@%*ck cares what Karl Marx said about Henry George. Look at what millions have said about Karl Marx if you want to play that little game.

    Henry George has done more to resurrect human spirit than has Marx. He doesn’t call for a revolt. He calls for human dignity through common wealth, access to all for all natural resources.

    He calls for capturing our collecting wealth rather than letting a few concentrate it in corporate privatization of the commons, of patents, the air waves, water, minerals, energy and more.

    He provides a clear and asute analysis and synthesis of the problem and a clear, unlike Marx, understanding of what is needed. Most economists today agree than most (if not all) revenues for public needs could be progressively handled with a land value tax. This cuts across every political ilk!!

    Marx complained. George offered resonating solutions. He didn’t produce a manifesto, or a dogma. As Tolstoy, an impeccable egalitarian, who honoured HG in his last book Resurrection. Ask Einstein (sure Einstein found socialism appealing as well). HG is neither a socialist nor a capitalist. He blends these not because that was his intent but it is what the problem demanded.

    Thank you Mr. Moses for acknowledging one of this nation’s greatest thinkers!

    (Disclosure: I frequently speak on colleges and universities and legislative bodies on the single tax and land value tax.)

  5. Max Shields said on June 6th, 2009 at 6:30am #

    By the way, many economist think the recent melt down is tied not to subprime but to the insurgents of land value.

    We need to understand what makes the rich rich and the poor poor. Henry George did.

  6. David said on June 6th, 2009 at 6:51am #

    Quotes and authors and books and…

    Here’s the lowdown on human activity: It’s like Brownian movement – it’s random.

    Of course, you can usually find a short-term sequence of events that can provide the palliative of stability but there really is nothing there, only the gnawing fear that drives you to redefine randomness as something that makes you feel safe for a moment.

  7. Max Shields said on June 7th, 2009 at 9:30am #


    You are so vile with your attacks you miss the whole message in the article. The quote by Kudlow is not to support Reaganomics. It is the sentence after the Kudlow quote that is key.

    Land is by nature limited. Therefore taxing it based on value (which we determine by how we settle and populate and invest) ensures it is used both wisely and is demonopolized.

  8. dan elliott said on June 7th, 2009 at 10:46am #

    Max Shields, what a clever snake you are. How interesting that we now see certain elements of the Zionist-dominated Ideological State Apparatus posing as “anti-Zionist” in order to lend plausibility to the snake oil of Henrygeorgism and other tricknological devices which facilitate self-justification for petty exploiters. Congratulations, you’re even slicker than Andy Winkler.
    Henry George is the political economy equivalent of “Intelligent Design”. Only crackpots and charlatans try to maintain that Henry George is worthy of discussion, in the same category as Flat-Worlders.

    One thing I’ve learned through experience is that people who are in general hostile to Karl Marx are also hostile to “the lower orders”, and to the idea of replacing the current social order with something radically different. They may claim they desire “change”, but don’t want things to Go Too Far.

  9. Max Shields said on June 7th, 2009 at 12:03pm #

    dan elliott,

    Since you’re ignorant of what you speak, and your “experience” sounds like a pathology (learning the wrong lessons from an observation) I can only say, you should begin start by reading both Marx and George, as I have.

    Come back when you’re through and tell me what you’ve learned.

    What makes Marx more plausible? Where are his dialetics implemented? In China? In Russia? In Viet Nam? Where?

    Venezuela and Cuba – who have very different forms of social reform are not pure Marxist in any sense, particularly Venezuela.

    Do you really think Northern European democratic socialism is Marxist? Come now. Grow up.

  10. Max Shields said on June 7th, 2009 at 12:05pm #

    Your definition of a zionist needs some refinement as well. It is clear to anyone with a brain you aint got one.

  11. bozh said on June 7th, 2009 at 3:31pm #

    well, folks, i am averse to defining, among many other isms, also zionism.
    isms are lofty words; on a very high rung of the abstraction ladder leading to the moon and beyond.
    however, the label “land robber” for a ‘zionist’ is found easily on the ladder; it is located on the first rung; one cannot get lower than that.
    in other words, robber or robbery cannot be further elucidated. Details can be added such as robbery with a gun; by murder, threat of violence, etc.

    answers true or false do not apply to ideologies. Ideologies are wishful thinking.
    it is neither true nor false that we shld have free healthcare; it is just what we want and SHOULD have. This just can’t be further elucidated; being crystal clear.
    actually, healthcare or higher education wld not be free; we all wld pay for it.
    people receiving higher education wld later as experts and professionals more than pay back what they got freely while in school.
    but look how much talent we are wasting by not making higher education free!!
    more educated people wld look after their bodies better than uneducated people; thus, healthcare wld cost less.

    ruling class knows this, i deduce. And their rule wld mightily wane if people wld be better educated/enlightened.

  12. Max Shields said on June 7th, 2009 at 7:40pm #

    And since Henry George and his Land rights as described in Progress and Poverty are just the opposite of a land thief, posters like dan e need to get a little education before spouting out non-sense.

    George provides the means to ensure environmental access, land, air, water, minerals etc. to ALL.

  13. Max Shields said on June 9th, 2009 at 8:13am #

    What makes Henry George particularly unique and, I think, different from say, Marx, is his deep sense of first principles. It is this moral quest for the irrefutable that gives his analysis and synthesis such incredible resonance.

    He did not set out to attack “capitalism” or “socialism” but to understanding the deep underpinnings of poverty and it’s observerant relationship to a kind of “progress”.

    He did not rail against an “ism”. He profoundly explored what was clearly in front of him, in front of us all. It was not an abstraction, but a moral imperative that drove him to dig deeper and deeper into this understanding until it revealed itself.

    What make Henry George much more enduring, even if subtly so, than Marx, is that you cannot refute the first principles that led him to Progress and Poverty. It touches the very essence of human nature, of the most fundamental needs; our vital relationship to land, to air, to water, to the atmosophere, to natures bounty. George never wavered from this true north course. It led to his understanding of slavery (not just the “official” slavery, but to the broader question of even when “men and women” are “free” most are still enslaved by their lack of access to the planet).

    The main political difference between him and capitalism and socialism was that his was not an ideology of who runs the place. Capitalism is run by the dictates of heads of industry and finance. Socialism is run by the dictates of the state. Both tend to enslave.

    He conclusions led to some of the most profound understandings of monopolies as the bane of human existence and the importance of government as an agent of the public domain, but with the private domain having its essential role. Vigilance (and some measure of wisdom) is required to understand the differences between these two domains, and the important role they play in a quality of human life.

  14. bozh said on June 9th, 2009 at 9:57am #

    free healthcare, free higher education/enlightenment, and the right to be informed, free people s’mwhat. As more goodies [inheritance] are obtained, people get freer.

    let then a fascist governance and gov’ts, like in US or socialist governances/gov’ts like in venezuela, rule to their heart’s desires but do not retract the rights i’ve just enumerated, i’ll be quite happy about such rules.
    broadly speaking, a governance like the one in norway frees people much more than a governance in US.

    the word “governance” , to me, is interchangeable with the word “system of rule” while the word gov’t is, to me, interchangeable with management team.
    the vast differences btwn governances of many european lands from the US governance, occludes enserfment that exist in US.

    US governance- which i often call “americanism”- is vastly different than any other.

    if my memory serves me correct, most people avoid the study of the US governance and dwell largely or solely on a narrower topics such as obama, gov’t, jurisprudence, etc., even tho these are mere aspects of a whole; i.e., of a system of rule.

    while US governance is different than any other, it is in some aspects exact copy of roman, persian, ottoman, assyrian, greek governances.
    and i think my readers know the aspects that these evil empires share. tnx bozhidar balkas vancouver

  15. Max Shields said on June 9th, 2009 at 12:32pm #


    There is a distinction between public domain and “government” to be sure.

    The US Constitution which most people laud as a great document to protect rights, etc. is really akin to a corporate charter. When the US was setting up shop, during/after the revolt against the motherland, it quickly moved to put in place a hierachical government, with the full gambit of institutions, and with a militia to put down unrest and internal revolts, frequently these were collaborate relative poor whites and blacks.

    The US government was clearly, from day one, a plutocracy with a ruling/land class.

    What Henry George, much later noticed was that within 25 short years the ragtime town of San Fransico went to a major West coast city and port. During that time, the first people to hitch a horse to post, became major land owners. This land was essentially free. The development of the City created great wealth for those who had not earned it but happened to get there before the next wave of immigrants.

    George saw the with this progress was created great poverty in contrast to the concentration of great unearned wealth. This was a phenomenon which has existed for millenia but George saw it all in a span of 25 years. It is the premise of plutocracy and imperial empires. It is not the economic system per se but who has control over the resources. That is the central issue.

  16. bozh said on June 9th, 2009 at 1:39pm #

    once americans wld obtain most basic of basic human rights [healthcare, enlightenment] let also the question who owns land stand aside; at least till the two rights are returned; i.e., not GIVEN but GIVEN BACK!
    for land robbers are also robbing people of basic needs and wants.
    so, the first step wld be to stop the thievery. It seems it can be stopped by an enlightenment or by a military revolt.
    for a military action to succeed, it must have at least 80% support. present system of rule in US is strongly supporetd by about 97% the people.
    this means, that elightenment wld be obviated for a long time; not just in schools but also in all institutions, media, army, cia, fbi, judiciary, etc.

    enlightenment s’mhow must be imparted. One hopes that at least chinese leadership stays steadfast in assuring chinese their basic rights.
    i can assure you that if that policy continues, nothing in this world cld force a people to give up their basic rights.
    and that wld help also to educate amers.
    yes, in china, korea one does not have the right to free speech but any mother concerned about educating, feeding, curing her children cldn’t care less for this an almost exclusively plutocratic pastime.
    i also think that an amer, once enlightened, wld feel just like chinese feel.
    as an aside, and from what i know, socialists in e.europe have failed socialism in the main because higher echelons were not socialist, great number of people were/are fascist, and they were too close to fascist europe.
    europe is fascist. If it wasn’t, it wld not be killing chidleren and women in afpak, iraq, palestine, and elsewhere.

    in canada decades ago, rev. thomas douglas as premier of manitoba enacted free heatlth care in manitoba in spite of threat of the medical profession to leave the province if it was enacted.

    i hear now, that most doctors approve of our medicare/healthcare.
    in canada we do have a two-party system of governace: New Democratic and a conservtive-liberal party.
    the latter is like demo-republic party in US.
    nationally, New Democrats are weak; only one in five vote for it. This helps explain why we are fascist also; at least towards people we are killing.
    nevertheless, the threat of few yrs ago to our healthcare has virtually vanished. i think the rulers saw it as a mission impossible and gave up.
    for now! tnx