The first day of the Land and Poverty Conference, as I approached the World Bank from H Street, I noticed several homeless people still sleeping on the benches outside. As I cleared the trees separating the tiny Edward R Murrow park (“Look now, pay later”), from the Bank, I looked up to see a massive banner covering the northern wall which read “End Poverty” adorned with happy African faces. I entered the building filled with irony, contempt, and awe.
Why am I here? I had a revelation a few years ago that most of the things I was worrying about didn’t matter. While I was concerning myself with well… myself, people were needlessly dying. I decided that I would do everything in my power to abolish abject poverty and other sources of suffering. After a great deal of searching for the best place to focus my energy, I came across the idea of collecting and sharing the value of natural resources, i.e. natural resource rents, as an alternative to NGO charity, international aid, microfinance lending, and a slew of other popular reforms. The ethos of this reform is that the earth belongs to everyone. We all have a right to be here, and to enjoy a clean and safe environment. How can society secure these basic human rights? By sharing the economic value of nature.
My colleague, Alanna Hartzok and I have been writing grants for a project in Nigeria designed to allow communities there to fund their own schools, hospitals, running water, and other basic services out of local land rents. This would allow these communities to bypass the inefficient central government institutions that fail to deliver basic services (despite the vast profits that are made on Nigeria’s oil).
In Norway and Alaska, the situation is different. These governments share the value of their oil reserves with citizens. This makes sense both morally and economically. Collecting the rents from natural resources improves economic incentives, and allows governments to remove taxes on productive activities like work and exchange. As Paul Collier, an Oxford economist and former director of the World Bank’s Development Research Group, says, “Natural resources have no natural owners. They just exist.”
Last year, Dr. Collier spoke at the World Bank Land and Poverty Conference and explained the need to socialize land and natural resource rents in order to pull countries out of poverty. When Alanna told me she would be presenting a paper at the same conference this year, I was very excited that we would have the opportunity to share ideas with such influential policy-makers. However, I was, and remain, skeptical of the World Bank. After all, this is the same institution, along with the IMF, that has prolonged a great deal of poverty through structural adjustment programs, which stipulate resource rent expropriation as a condition for loans in the name of “development.”
Once inside the bank, I made my way to a conference screening room with large windows overlooking DC. There I met David Triggs, chairman of the Henry George Foundation in London, whom I had a nice chat with. I met several speakers in that same room, whom to my surprise, were very aware and supportive of land value taxation (a form of sharing land rent). I conversed for hours with one very enthusiastic Frances Plimmer, a British surveyor. Later in the day, I was able to ask the former president of Botswana a question about his country’s treatment of the San (Bushmen) people, and Botswana’s high taxes on diamond rents, which you can read about here.
The next day, Alanna gave her presentation entitled Socializing Land Rent, Untaxing Production (PDF) in a session Chaired by Gregory Ingram from the Lincoln Institute of Land Policy. Alanna gave a rousing speech, providing many concerned young people in the crowd with an overall sense of how natural resources rents are absolutely essential to ending poverty worldwide. After the session, I talked with several audience members who expressed genuine surprise that they had never heard of the idea of taxing rent instead of work. The representative from Oxfam said to me “I hadn’t thought about this before, but taxing land is obviously much better than taxing income. I see that now.”
To find out what happened during the rest of the conference, stay tuned for part 2 of this article.