Ed,

 

I was going to get rid of this as being out of date, but I realized you apologized for something you thought you had done – but didn’t.

 

So, I wrote  .  .  .  .  .

 

 

No apology required or wanted.

 

Do you really deny that the price mechanism controlled free market is the best allocator of goods?

 

Would you also deny that the Pax Britannica in the last half of the 19th century originated in the complete free trade policy of Great Britain, in which the only fees on imports were on tea and sugar – neither produced in Britain?

 

I’m sure that red ochre came in duty free.

 

Not that this was enough. Free trade multiplies production but it doesn’t distribute it justly. The analysis of Henry George got through to the British and they were close to adopting his land value tax as a just method of distributing Wealth before WW I.

 

Actually, about 50 years earlier, Richard Cobden of the Anti-Corn Law League – responsible for the move to free trade – showed he understood when he said:

 

You who shall liberate the land will do more for your country than we have done in the liberation of its commerce.”

 

This was long before George – but then the argument for taxing land goes back at least 5000 years to Mencius. This is not to acquire revenue but to prevent the holding of land from proper use to drive up the price.

 

At the time of Cobden, fewer than 2,600 landholders owned Britain.

 

The gap between rich and poor was mammoth. If you were not among the privileged, you were less than dirt. Our impression of those times is “Upstairs and Downstairs” – but the reality was horrible. Perhaps a choice between slavish obedience and prostitution for the downstairs maid.

 

As I’ve mentioned, nothing important has changed. Now 1% of the population own 70% of Britain. Perhaps this is better, but I rather suspect that the most valuable land is still in the hands of the large landholders.

 

Similar concentrations of land ownership are apparent in the US. I don’t know what the situation is in Canada.

 

Anyway, the Classical Analysis is clear and simple.

 

Raise production to its highest by removing restrictions on the production and distribution of goods.

 

Place a 100% land tax on the value of land to ensure that land enters the market place and no longer enjoys monopoly status with its privilege of “taxing” producers for private gain.

 

Harry

 

*******************************

Henry George School of Social Science

of Los Angeles

Box 655  Tujunga  CA 91042

818 352-4141

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From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On Behalf Of Ed Weick
Sent: Tuesday, June 07, 2005 7:01 AM
To: [EMAIL PROTECTED]
Cc: [email protected]
Subject: [Futurework] Free markets?

 

Harry, I owe you an apology for ending my last posting to you rather snarkely by thanking you for reminding us of the economics of the 19th Century.  So, forgiveness please, but you do tend to carry on about the superiority of the free market as in "The free market (when it exists) tosses out the companies which fail to supply the best service at the cheapest price."  I note, however, that you very wisely covered yourself with the little bracketed phrase "(when it exists)", which suggests that you too recognize reality.

 

My own view of free markets is that, like the Garden of Eden, they are a beautiful idea.  They may have existed long ago when, as Keith maintains, people traded red ochre over long distances, but I doubt that they were all that free even then.  The following article reminds us once again that there are huge multi-polar interests involved in markets as they now exist.  It also reminds us that, the more complex and costly the product, the more likely these interests are to rise to the surface (or to just under the surface)  and attempt to steer markets in directions to their advantage.

 

Ed

 

 

 

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