Rents are taxes on property. Taxes are rents assessed by tax collectors, public or private. In ancient times there was no difference. The lord and master of a property, whether a Squire, Baron, Count, King or Empire, collected rents as taxes owed him as owner. During the medieval times, ownership was usually a contract between the person who lived on a property and the government, embodied in a person. During the enlightenment, property owners conned governments into separating simple ownership from government. They did this by creating central banks and privatizing ownership of land. This allowed Lairds and lords alike to evict millions of peasants from their property to raise sheep or otherwise find more economically productive industry. A landlord could go broke not putting his property to such use, and both broke former lords and evicted peasants emigrated. It wasn't just the nobility. When you read books like Jane Austen you find the "gentry" figured their social status based on how much rent they could collect from property they owned. (See Piketty).
In the United States, the landlords had to be more clever. They learned early on that they couldn't just march into a frontier town and take their taxes. That sparked locals to form "Regulator Militia", so they mainly endeavered to wall off economics from politics and use their rental income to influence local and general government. It is no accident that it took a civil war to end slavery. It only didn't end sooner because it became economically valuable. Both the slave and the people empoverished by the best land being in the hands of landlords were paying a premium to landlords for the fact that they owned the more valuable property. Owning valuable property was the source of wealth for the few. Property taxes mainly made it easier for the already powerful to keep their property and force work out of small holders. This system, by its design concentrates wealth due to premiums in the form of unearned economic rent from the mere privilege of owning the more valuable property.
Henry George assessed the value of rent from property ownership as making the property owner "nature's tax collector." He knew that simply owning valuable property was a source of unearned premiums. Basically property owners are collecting a private tax when they rent property or successfully speculate on property. They have a right to keep "wages of intendency" & a duty to collect and invest the income necessary to maintain or improve their property. They do not have an inalienable or absolute right to aggrandize valuable property, because land ultimately belongs as “natures bounty” in commons between a sovereign and those who work or live on it. An owners right to rent property is tied to "the sweat of the brow" used to keep that property healthy.
Economic rent is a premium a person gets for owning something valuable, having a degree, land, buildings, owning stock, owning a business, company, etc... and employing people to use that property. Henry George made a valid distinction between property taken, borrowed, or owned from natures finite bounty and property that is lived on, productive and tended. The reason he did this is that the premium from simply owning part of natures bounty is unearned. Additionally, if one has valuable property, the premium from working that property is not entirely earned. Henry George called properties belonging to "natures bounty" "land", by land he also included Oil, Gas, Coal, though because his supporters came from oil, gas & coal interest that would be obfuscated after his death. He used the word "economic rent" to describe such premiums from working land, employing labor, owning property & renting properties. He described them as premiums and avoided calling them income because he knew property owners would try to confuse the two. After he died they did.
If one performed any kind of labor, one has earned one's income. If one earns a premium from simple ownership of property or privilege, that income, some or all of it is unearned. Earned income also comes from when one improves property by one's effort. Such productive property, tools, plant, factories, raw materials, are capital. In the Georgist formulation the three factors are labor, natures bounty (Land) and capital. Capital should not be confused with land when calculating unearned premiums from property ownership. High Rents in Manhattan reflect the valuable monopoly that is land there. The buildings themselves are capital. The way you tell is that the buildings need constant maintenance, sustainment and refresh, to retain their value. That maintenance, sustainment and refresh is earned. Any value over those costs is economic rent.
No one should be taxed on gross income no matter the source. No one should be harmed by taxes, nor should taxes lead to depreciation of properties real value. Taxes should always be figured on net income and net premiums. If a landlord or building manager tends the buildings he manages. All those costs are justly part of the rent he/she charges tenants. Taxes on land value should fall on the premiums gained from owning the property. Thus the rentier should pay progressive taxes on the economic rent he/she receives. One can link the zero tax rate to a calculated poverty level and allow cost of transport, food consumption, maybe donations, and personal shelter costs to go untaxed completely. One then sets up a system where no one pays taxes on that portion of income. But anyone making more than that pays maybe 10% of the net above that amount.
If one performs some kind of labor or work, one has earned at least part of that premium. If one's premiums are privileged, not all of it. The underlying principle goes back to the middle ages; “Do your duty or pay a duty”
We privatized ownership markets (stock markets) and money, long ago. But the constitution gives government sovereignty over our money supply. The Federal Reserve only makes sense as an arm of the Treasury. As a private bank, it has too much power to engage in mischief. Wealthy people live on rents from owning banknotes and debt. When the economy does well they do well. When it collapses they take property from both workers and capital, but they and the rest of the rentier class wind up wealthier than before the crisis started. At this point the business cycle is an intentional feature not a bug in our system and is an instrument for taking wealth from working people, in other words, exctracting economic wealth using debt.
Money as debt is not innocuous. Federal notes are useful backed by token money. Backed by government debt, they are a means to extract rents from tax payers. Backed by personal or corporate debt, they are time bombs. Avoiding risk is avoiding responsibility.
The Fed should be supporting public capital (highways, railroads, transport in general, communications and energy) thru supporting local and federal government solvency. Not enforcing "balanced budgets" that treat capital and natures bounty as if they were merely costs. The current system treats cities and states as less important than banks, GM, Ford, etc.... This is a worldwide phenomenom as the system of States are continuously held accountable for doing the right thing. The current system is based on extorting companies by stripping sovereinty from them over their own finances.
Four sets of inter-connected principles govern our country,
The existence of an independent Judiciary is derived from Republican Principles. It is based on hard won observation that judges should be independent of executive power and hold their offices "during good behavior." It is up to both the legislature and the Judiciary, but first in the court of the legislature, to define what "during good behavior" means. The principle of separation of powers implies that Judges can only judge what good behavior is, if that is well defined by the legislature based on long standing principles.
Congress has a duty to legislate the definition and parameters of what “during good behavior” means. They have done this somewhat. There is a code of Judicial ethics that applies to all the Federal Courts except the Supreme Court. That is odd. For the most part Judges hold their offices until resigning due to some scandal or being arrested. Congress can exercise judicial review over them. But often that goes awry as it tends to be policiticized in the process and to have nothing to do with their fitness as judges. This results in impeachments being rare and usually only following outrageous conduct. But the "on good behavior" implies that it would be constitutional for mechanisms to be created for the Judiciary to police itself. But first we must consider what the judiciary is, or should be.
The founders argued about the formation of the Justice department. This is because, technically almost everyone working their is part of the court system. Judge, Jury and Executioners, all are part of the Judiciary, and thus are, or should be, officers of the courts, subject to strict standards of behavior higher than those of civilians. So technically should legislators be when passing laws that will impact the courts. The founders wanted the National Attorney General to be an officer of the court and to be independent of partisan politics or self interested actions. They left him as a "subordinate" officer of the president in the hopes that the President would have the judgement and virtues necessary to keep his job scoped (focused) on enforcing the laws of the country. The courts have considerable civil and criminal powers as a result. When those are bent to self interested purposes they become subversive of good government. So the issue of how to police the police remains fraught with peril and unresolved, as Executive, legislature and judiciary, are all too self interested to police themselves. I propose an administrative mechanism to correct this problem.
Thanks to Trump we've seen the potential for abuse embodied in runaway executive power. The flaws there, were there all along, but it took a wannabe dictator to see how easy it was to subvert them.
No system is sailor proof. That is why administrative actions need to operate as if they were trial courts. Further, they need to operate as Jury Trial courts, if necessary, in order to be fully fair to both the people as a whole and those being scrutinized. We need every officer to be subject to periodic scrutiny. The courts and their officers are “officers of the people” and therefore should be accountable.
The law has to specify entry points and affirm that people have a right to substantial due process. Otherwise substandard due process becomes a checkoff point for the efficient tyranny of runaway legal process.
There are informal judicial proceedings that may involve people otherwise not in the court system. Anyone who can, can and usually does moderate simple disputes. If substantive agreement between the parties can be achieved, a simple contractural agreement should be able to memorialize the informal adjudication. When judges are engaged in informal adjudication, the same rules should apply as when an Umpire calls strikes in a baseball game. Except, if agreement fails, then that becomes the entry point for formal judicial process. Judges should be encouraged to seek agreements in private disputes. Those agreements should be binding unless deception, force, threats or bribes were used to achieve them. They can be private unless there is a public interest in the outcome.
When agreement is not achieved or affirmed in writing, deception, force, threats or bribes occured, or there is significant public interest in an adversarial procedure occuring, then that is the entry point to formal adjudication. The first stage can be an informal Judged trial. If the parties agree to be bound by the judges decision, then that should be respected. If not a person should have a right to a jury trial. This goes for all judicial type proceedings. Informal or formal, all such proceedings should have at least two counsels available. One for each defendent, one for each person pursuing the matter. This should be true for administrative judging as well as traditional courts. Anyone with judicial powers, must be a judge and member of the judiciary, in order to hear any kind of formal case. And anytime a defendent or subject requests a jury the trial should use that jury.
Administrative hearings are sometimes necessary to establish regulations, review petitions for citizenship, etc.... I believe they further should be used to scrutinize candidates for office and periodically review office holders. Such bodies should have the power to inquire, subpoena, do accounting reviews and scrutinize past performance to determine candidate or office holder fitness as prospective officers to receive a job or continue in office.
This is a judicial function and an administrative function. It therefore should be performed within the judiciary, as a regular function with an informal process followed by formal process if contested. It is not about criminal behavior or even civil torts, but about whether someone is behaving with integrity and is fit for their job. Therefore while it should use juries to weigh fitness for office, matters of crime and damages should be referred to different bodies and different judges. In the case of elected officers, the information should be published to the voters because the voters are the ultimate judges, through recall petitions or elections.
In the case of unelected officers, hiring or firing decisions should be in the hands of the chain of command and the information also published. In any case such courts should have no power beyond subpoena and order enforcement (contempt of court or seizure of evidence). It would have the power to forward evidence of wrongdoing to an ordinary court. No judge should be involved in his or her own case or of someone related to them or in their own chain of command. Admin courts would receive IGs and be established in regulatory and oversight agencies. The body of rules in the law and not subject to over-ride.
The judges would be subject to the same scrutiny. Juries would come from the jury pool and be selected by voir dire. The investigators would be selected from local journalists, and Government investigators, in a similar manner.
Congress must establish a strict definition of what "during good behavior" means and let administrative courts enforce it. If they want to be really effective, they'd include themselves in the scrutiny laws.
I'm not a lawyer, so the details behind this probably need some work.
Expand the court
The Supreme court does not have to be 9 members. It could be 12, 13, or 15. But more importantly all judges, including the ones on SCOTUS should be subject to the same rules that define "during good behavior" for the entire judiciary and judicial impeachment [firing] should be the remedy for violating those rules. That should not take an amendment to COTUS. Moreover, one of those rules should be no judge may be a prosecutor or judge in his own case.
The beauty here, is that were the courts to rule they don't have the power to police themselves, they still would [and should] have the power to report an impeachment recommendation to congress. The house could pass the bill to the Senate & the case record would already be available.
Given the amount of corruption revealed since Citizens United, the Congress might not even need to expand the numbers of judges, just remove badly behaving ones.
I woke up in a dream where I was walking back to my house in the snow and a neighbor started singing Fernando. I woke up singing along. The song is about the Mexican Revolution, which started near El Paso with young people wanting a less corrupt government. The version I had was a medley of Abba voices & a baritone male.
My Great Grandpa was there in El Paso. My grandpa was a baby. My Great Granddad was a railroadman who had friends who were probably involved in the Mexican Revolution. But he was warned about the dangers and moved back to Vermont.
The Mexican revolution exposed both the ideals and hypocrisy of our countries. Some of the major fighting started just across the border. And Wilson sent Gen. Pershing to intervene in the war after Pancho Villa raided our side of the border. Our involvement in WW1 was largely inspired by German efforts to get Mexico to attack us - or British efforts to make us think Germans were doing that. Influence operations are not a new phenomena.
