Saturday, April 18, 2015

Tearfund: land value tax, money reform and basic income

This week the Bishop of London Richard Chartres called for a 'passionate concern for the common good and a fuller life for everyone' (The Times, letter 16 April 2015).  He was launching a discussion paper by the charity Tearfund  The Restorative Economy .

This is a highly significant paper in its scope and insights; with its suggestions for transformational policies; and from where it comes - a prominent Christian-based charity. As seen in the earlier blog the  'Bishop's letter: Postscript coming?'  issued by Church of England bishops, disappointed by the somewhat bland recommendations. But this Tearfund paper is seminal. It suggests using the restorative principles of the biblical jubilee as an 'instruction manual' and theologically argues that the mission of Jesus was a re-uniting and restorative one. Tearfund sees its work as an 'integral mission' covering lifestyles including such things as economics. This is highly unusual! As seen in the 'Bishop's letter', the official church does not usually challenge the status quo and vested interests with awkward recommendations.

Tearfund (not a church-based charity) has clearly moved beyond its original brief of famine relief.  It acknowledges success in recent years in reducing disease, poverty, and increasing life expectancy, but although it sees promise in our future, there are obvious threats ahead, with inequality rising and economic insecurity for millions.

Thus it wants measures:
' to share the proceeds of that natural wealth fairly, just as jubilees reset land ownership on an equal per capita basis.'

' through stronger and fairer taxation of property (via a land value tax) ...
a strong moral case for using some of the income from land for the benefit of society as a whole, and for preventing wealth from becoming increasingly concentrated over employing taxes on land/property and on wealth transfers to fund services such as education and healthcare.'

it explains land value tax:
'A land value tax. At present, business rates in the UK apply to the rental value of commercial property – in effect, taxing buildings rather than the land underneath them. The problem with this approach is that it creates perverse incentives, which can (for example) skew our economy away from industries that use expensive buildings – such as manufacturing....'
'...The Mirrlees Review therefore calls instead for a land value tax, arguing that ‘this is such a powerful idea, and one that has been so comprehensively ignored by governments.'

and even extends to the reform of money and banking:
'a hard look at the implications of the framework within which money is created in our economy. Would it be worth considering, for example, requiring banks to keep a high level of reserves against deposits (setting a level of, for example, 50 per cent – half what has been suggested by the Financial Times’ Martin Wolf and IMF researchers)?'

and wants the provision of a basic income:
'Allow poor people everywhere to meet their basic needs by introducing a global social protection floor, including healthcare, education, nutrition and basic income security.' 

It calls for political action across disciplines 'joining the dots' :
'Looking back at key moments in history, it’s clear that the tides often turn because of the emergence of a movement for change. Right now, we need such a movement, one that follows in the footsteps of the anti-slavery campaigners, the US civil rights movement and all the other examples of ordinary heroes – Christians, people of all faiths, people of none – who together achieved the impossible. These movements faced almost insurmountable odds, but they overcame.'

posted by Charles Bazlinon, author of The Free Lunch - Fairness with Freedom which prefigures much in the Tearfund paper.  

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