Please join us for the IU Forum this Monday, October 2nd, 3pm New York time and 8 PM London.
IU President David Triggs will present an in depth analysis concerning the BREXIT issue from a Georgist perspective. Participants will be invited to share their views as well.
How to connect with us on Monday: Just click on https://global.gotomeeting.com/join/266111093 You may have to first download the free GoToMeeting software. If this link does not work simply enter the nine digits after going to the GoToMeeting website. Headphones are recommended but not necessary.
Note in your calendar also that the IU Forum after this one will be Monday, October 9th, with Alanna Hartzok, IU Administrative Director, presenting a Georgist framework on economics of war and peace and its relevance to current US foreign policy.
The Obscure Economist Silicon Valley Billionaires Should Dump Ayn Rand For He lived almost 200 years ago, but Henry George’s theories might have something to offer people who want to put their money to good use today. by Michael Kinsley September 1, 2017 8:00 am from VANITY FAIR So, you’re a Silicon Valley billionaire and … Read more
“We will close our reservation borders to Keystone XL. Authorizing Keystone XL is an act of war against our people.” — Cyril Scott, President, Rosebud Sioux Tribe
“Get off my land!” That injunction, which calls to mind a rifle-wielding homesteader, protecting hearth and home against intruders — is about as American an image as you can think of.
The civil infrastructure behind that image is less storied, but equally consequential. There is scarcely a square inch of North American land whose tenure is not duly recorded and righteously enforced, down to the pickiest easement or lien. Americans believe in land ownership.
A big infrastructure project, such as an oil pipeline — or a highway, or a railroad — must pass through many boundaries, and its legal right to do so must, in every case, be secured, purchased, negotiated — or conquered. There are many layers of irony in the fact that the biggest, most fraught and controversial pipeline project of the new century could be stopped by a band of people in tipis, saying “No further.” Many people have heard of the Keystone XL pipeline. A fair number have even marched against it. However, readers may not have a clear idea of the overall industrial context; in other words, they might not know how many oil pipelines there are: some 185,000 miles of them, crisscrossing the United States, carrying every kind of crude oil and refined petroleum product. About 55,000 miles of these are “crude oil trunk lines,” of which the Keystone XL represents the large variety. It is planned to be three feet in diameter (the trans-Alaska pipeline is the biggest, with a diameter of four feet). Its daily capacity is projected to be around 830,000 barrels of crude per day.
It’s hard to get your mind around something as huge as oil consumption in the United States. The US currently uses 18.89 million barrels of oil per day; this figure is down from a high of 20.9 million in 2006. That seems like a lot. How can we visualize it? Let’s think of it in terms of tanker trucks: the big semis that pull up to fill tanks at your local gas station. Such a tanker carries about 5,000 gallons, or 895 barrels of gasoline. That means that today’s United States uses 21,106 tankerfuls of oil every day. Each of those trucks is about 60 feet long; if we put them all on a road with an average of three feet of space between them, we’d be looking at 252 miles of semi trucks. And, of course, we don’t consume crude oil, we consume refined petroleum products, which means that the oil has to be transported at least twice. That means that, at a minimum, the US’s daily oil-transportation needs would fill four lanes of the entire length of the New Jersey Turnpike bumper-to-bumper with tank trucks, with a few thousand more waiting on the on-ramps. Tanker trucks, of course, really only make sense for dispensing finished products; most crude oil is moved through pipelines.
If that’s the case, then why is the Keystone project so controversial? Well, to hear its supporters talk, it shouldn’t be. Arguments against it are characterized as no more than treehugging, Obamafied puffery. Oil is oil; it’s the stuff that modern economies run on; demand for oil may fluctuate a little, but over the long term it’s a given. Getting more crude to US refineries, especially from a friendly neighbor country, can only be a good thing. “Global warming” probably isn’t even real. These assumptions describe the political climate that TransCanada faced in building its Keystone pipeline project, most of which, indeed, is already in place, transporting gobs and gobs of oil as we speak. They didn’t expect this final section, connecting Hardisty, Alberta with Steele City, Nebraska via Montana and the Dakotas, to pose a problem.
Oil Sands: the Crudest Crude
When we hear the price of oil reported on the financial news, we often hear it in terms of the a benchmark called “light, sweet crude,” which sounds very nice, sort of like maple syrup. Lightness and sweetness are references to crude oil’s density, and its sulfur content. Light, sweet oil, such as Brent crude from the North Sea, are priced higher, because they demand less refining to yield retail products such as gasoline. The kind of crude oil the Keystone XL pipeline would carry is less like light, sweet maple syrup, more like the kind of gunk you’d scrape off the bottom of a truck. It’s called “oil sands.” (Many call it “tar sands,” which is more descriptive, but Canadian oil people insist that because tar is a human product, “oil sands” is more correct.)
The resource is bitumen, a tar-like substance mixed with sand. Extremely large deposits of the stuff exist in Alberta (there are other large deposits in Venezuela). It is mined in two ways, either by strip mining, for shallow deposits — or, for deeper deposits, by a process similar to fracking, in which steam is forced underground, liquefying the bitumen and pushing it to the surface. In either case, however, mere mining doesn’t elevate the gunk to the status of “crude oil.” It must undergo an energy- and water-intensive pre-refining process to make it valuable enough to bother with refining, and fluid enough to move through a pipeline.
Indeed, in the oil-embargo years of the 1970s, there were proposals to exploit Canada’s oil sand fields, which have long been known to be vast: Canada’s proven oil reserves are second only to Saudi Arabia’s. But because of its many disadvantages, oil sands was not deemed commercially viable at the time. Since then, a few factors have changed: easily-recoverable sources of liquid crude oil have become depleted, raising the average cost of a barrel of crude. Lots of oil is still being brought to market, but more of it is getting there through new technologies such as deep-ocean drilling and hydraulic fracturing. The newfound viability of Canadian tar sands (if it indeed exists) is part of this trend. Additionally, instability in the Middle East, the area that surrounds the world’s largest petroleum reserves, makes North American sources that much more attractive.
Nevertheless, the delivery of tar sands oil is anything but a light, sweet process. Surface mining operations thus far have dug up huge areas of hitherto pristine boreal forest and marshland; some four tons of earth must be moved to create a single barrel of oil. Furthermore, separating bitumen from its sand matrix consumes between two and four barrels of water per barrel of oil. It actually uses more water than that, but some is recycled. The used water, however, is laced with toxic chemicals and cannot be placed back into the environment, but is held indefinitely in huge “tailings ponds,” two of which are visible from space to the naked eye. The process also uses lots of energy. The strip-mining operations use the world’s largest electric shovels, loading 100 tons per scoop into dump trucks that carry 400 tons per load. The water used to separate bitumen from sand must be heated. It has been estimated that current tar sands operations contribute four per cent of Canada’s total greenhouse-gas emissions, and that figure is projected to triple over the next six years. Some engineers are proposing to lower this figure, however, by using portable nuclear reactors to heat the water.
The more one looks into the realities of the tar-sands industry, the more absurd it seems. In order to separate the bitumen (which is only twelve per cent of the oil sands “ore” by volume; four tons of it must be mined to yield a barrel of oil) they need to heat so much water that nuclear reactors are a viable way to do it? And even once the bitumen is separated, it is still too viscous to ship; it has to be “upgraded,” using more heat and pressure, to get it to flow.
But, (advocates insist) we need the oil. And if these ecological travesties are going on way up in Northern Alberta (where, by the way, it is creating lots of jobs; the remote village of Fort McMurray is a boom town), what do we care? They’ve got plenty of land up there. But: the remoteness of the Albertan oil sands deposits brings us to the next chapter of our story. No oil-refining capacity exists anywhere near them. For this oil to be viable, there has to be a cost-effective way to get it to refineries.
Advocates of the Keystone XL assert that it should be built because those Canadians are going to sell their oil anyway; if they can’t use this route, they’ll send it West to the Chinese, or East to Atlantic ports. It isn’t that easy, though. To get to the Pacific, a pipeline would have to cross the Rocky Mountains. The route East is much longer, would have to pass through many complex, populated rights-of-way, and has already faced vociferous opposition in Portland, Maine, where voters this year prohibited the reversal of flow through an existing pipeline to accommodate oil-sands crude. Shipping of crude oil by railroad is at just about the peak of existing capacity, and has led to some devastating spills. No, there is a very big, very clear reason why the Keystone XL pipeline is such a big deal:
Without it, the Canadian oil sands industry will be a losing proposition.
Now, let’s be clear: I’m saying that without Keystone XL, the Canadian oil sands industry will be a losing business proposition for its investors. It’s already a losing proposition for the planet; its external costs are, as we’ve seen, absurdly high. But, in spite of everything, if it is able to deliver 830,000 barrels per day to US refineries, it will be profitable — and this pipeline is the only way it can possibly do that. If the pipeline goes through, mining operations will ramp up, economies of scale will kick in, and money will be made. If it doesn’t, well… then the big scar on Alberta’s land won’t get bigger, and a very large amount of carbon won’t get dumped into the world’s air.
James Hansen and Bill McKibben saw the writing on the wall, and organized a very efficient public campaign to raise awareness about the pipeline and its dangers, and their efforts seem to have been effective in strengthening President Obama’s resolve against the project (because it crosses an international border, its final approval is the responsibility of the State Department). This could be overridden by new legislation. A bill to force approval of the pipeline recently lost narrowly in the lame-duck senate; once the new Republican senate is in place, it will almost surely pass. Obama has been sending signals that he would likely veto the bill — but, that may not be the end of the Keystone XL. There could conceivably be enough votes to override his veto, or the pipeline could be traded for a policy the president wants more, such as a minimum wage increase.
The Last Stand
So, bad as it is, the Keystone XL might get the go-ahead anyway, and there’ll be no stopping it, right?
Perhaps there will. There is another sovereignty that must be consulted here — one that deeply disapproves of the Keystone XL pipeline. President Cyril Scott of the Rosebud Sioux Tribe said this in a November 14th statement in response to the bill to force approval of the pipeline that was passed by the House of Representatives:
[T]he Rosebud Sioux Tribe (Sicangu Lakota Oyate) recognizes the authorization of the this pipeline as an act of war. The tribe has done its part to remain peaceful in its dealing with the United States in this matter, in spite of the fact that the Rosebud Sioux Tribe has yet to be properly consulted on the project, which would cross through tribal land, and the concerns brought to the Department of Interior and to the Department of State have yet to be addressed.
The House has now signed our death warrants and the death warrants of our children and grandchildren. The Rosebud Sioux Tribe will not allow this pipeline through our lands.
In earnest of this, the Rosebud Sioux, with the full cooperation of the other Sioux Tribes in South Dakota, have set up a “Spirit Camp” near the tiny community of Ideal, South Dakota, on a small patch of Rosebud tribal land that appears to lie in the proposed path of the pipeline. There, tribal members and supporters have vowed to stay, to guard the land and stop the pipeline.
Does the pipeline route actually cross reservation land? That is an important question, and it appears that TransCanada has chosen the route carefully to avoid doing so. First Nations in Canada have, for the most part, strongly opposed oil sands development, and the company clearly wanted to avoid crossing reservations land in the US, recognizing that doing so could expose them to another level of legal complications. However, it is very difficult to cross the country to the North and East of the Rosebud Sioux reservation without crossing land that does, indeed, belong to the Rosebud Sioux. And, furthermore, even were the pipeline not to actually cross Rosebud trust land, consultation with the tribe is still legally required if such a project were to cross adjacent lands in which the tribe has recognized riparian, burial or sacred considerations.
This Far. No Further.
The question of whether a crude oil pipeline in South Dakota crosses sovereign Indian land is by no means settled, legally or morally. The history of the “Great Sioux Reservation” which was created by the 1868 treaty of Fort Laramie is, in many ways, an apt microcosm of the entire history of dealings between the United States and the indigenous people of North America.
The vast majority of surviving Native Americans never surrendered to the United States, and never sought to become US citizens. As settlement pressure increased, tribes were moved, often forcibly, to designated areas. On these reservations, Indians would maintain self-government. They were not subject to the laws of the state(s) that surrounded the reservations; they would maintain a “nation-to-nation” relationship with the federal government, based on treaties (treaties duly negotiated between sovereign states had long been considered, under common law, as the law of the land).
However, by 1887, even that arrangement, disadvantageous as it was to the Indians, came into conflict with the Manifest Destiny of the United States. That year, under the Dawes, or “General Allotment” Act, Native Americans were offered US citizenship under the worst possible terms. Under this law, the reservations would be dissolved and individual families would be allotted 160 acres of land. If individuals accepted these allotments and farmed their lands in a suitable manner, they would be granted citizenship. To be sure, there were many more 160-acre parcels of land in the Great Sioux Reservation than there were individual families to allot them to. That was part of the plan: the “surplus” land would be made available to white settlers.
This was, of course, just the latest in a long series of treaty abrogations by the US government. Nevertheless, as in the case of slavery (or fee-simple land ownership, for that matter), a need was felt for some form of legal justification. This came in the 1903 Supreme Court decision of Lone Wolf v. Hitchcock, which has been called the “Indian Dred Scott decision.” The court held that the US Congress has the power to unilaterally abrogate treaty obligations with native tribes. A series of laws, pursuant to this decision, offered to buy Rosebud Sioux lands for $2.50 (later $2.75) per acre. As the poster shows, these were bargain prices.
This history is the source of the “checkerboard” pattern of trust lands held by the Rosebud Sioux, which are now considered non-contiguous parts of their Reservation. The sovereign status of Indian nations was reinstated in US law by the Indian Reorganization Act of 1934, pushed by the Franklin Roosevelt administration and termed the “Indian New Deal.” By this time, however, more that 90 million acres, some two-thirds of Indian lands, had been transferred to white settlers.
The Profaning of the Black Hills
Gold was discovered in the Black Hills of South Dakota (and Wyoming) in 1874. Before that, this area, which had been held as sacred for hundreds of years, had not been much use to the United States. But, after the Lakota were defeated in the battle of Little Big Horn (1876), Congress seized the Black Hills, in a rider to an 1877 law that ceased all government aid, including food, unless the Black Hills were immediately ceded to the US. There was no mention of compensation.
In 1942, the national monument opened at Mount Rushmore (named for Charles Rushmore, a prospector). The mountain had previously been known by the Lakota as Six Grandfathers, and it featured prominently in the celebrated spiritual journey of Black Elk.
In 1980, the US Supreme Court, upholding a 1977 decision by the US Court of Claims, affirmed that the seizure of the Black Hills was illegal under the Fifth amendment, and awarded the Lakota $106 million in compensation. The various Lakota tribes making up the Sioux nation (Rosebud, Pine Ridge, Crow Creek, Cheyenne River, Standing Rock) agreed not to accept the cash compensation and demanded that the land be returned to them, as stipulated in the Fort Laramie Treaty of 1851. The money was held in escrow, and now totals over a billion dollars. Some are tempted to take the money; the various Sioux reservations are among the poorest areas in the United States. However, the current value of the settlement would only amount to a bit over $10,000 per person.
The Spirit Camp
It is widely understood that all aspects of legal precedent regarding the “government-to-government” relationship between the United States and Indian nations are uncertain. Indeed, the 1903 Lone Wolf decision (affirming Congress’s right to abrogate treaties with Indian nations at will) has not been overturned. And, laws passed that enforced the allotment policies of the Dawes act are still accepted as legal precedent. Nevertheless, there is a body of law that establishes some form of sovereignty for federally recognized Indian nations. Under that body of law, you can’t slap a pipeline down on reservation land — or atop sacred or burial sites on nearby stolen land — without permission.
The Rosebud Sioux members who are living in tipis along the pipeline route, outside of Ideal, South Daktoa, are making sure these facts are not ignored:
Resistance to this threat is underway. The Lakota and their allies are rising to the challenge with several carefully calculated actions, one of which is to organize and erect spiritual tipi camps to stop progress along the pipeline right-of-way…. We will use the legal and moral authority of the First Nations peoples to protect significant spiritual and burial sites which are at immediate risk…. Our government spends millions of dollars to protect cultural sites in other countries we occupy while it issues permits for the destruction of similar sites in the heartland of America for corporate profit.
The XL pipeline is the current leading threat to the survival of the planet and these spiritual tipi camps are our best opportunity to stop it. Lakota men and women are putting their lives on the line for all of us, and they need your help.
Should the Keystone XL pipeline survive a presidential veto, or otherwise gain government approval, the Spirit Camp could be the last thing that stands in its way. To be sure, the US government has the ability to sweep aside this resistance which, however heroic, is quite small. But, it won’t be able to do so without perpetrating yet another unforgivable atrocity against the Lakota people.
Fifty years ago Mario Savio delivered an amazing speech:
“put your bodies upon the gears and upon the wheels…upon the levers, upon all the apparatus…you’ve got to make it stop!” Savio’s words are believed by many to have sparked everything from the Free Speech Movement to the enormous opposition to the vietnam war.
People are protesting across the country today after juries decided not to indict the police officers who killed Eric Garner in Staten Island, New York and Michael Brown in Ferguson, Missouri. Activists are literally throwing their bodies upon the gears, blocking the highway in DC (see video below). Do you think recent events are the catalyst for a new era in the Civil Rights Movement? Perhaps the suppression of protesters marks a new era in the Free Speech Movement as well? Tell us what you think.
As world leaders assembled for an awkward “family photo” at this year’s G20 summit, Vladimir Putin was placed on the far right. This was done, perhaps in part, to keep distance between him and Australian Prime Minister Tony Abbott, who threatened to “shirtfront” rugby tackle the Russian president.
Local newspapers put it comically; Putin has been “exiled to social Siberia.” But behind the photos of shirtless Putin on horseback, and all of the flamboyant posturing surrounding the G20 summit are serious geopolitical and economic issues that affect us all.
Interest-group politics veiled as pro-market reforms
Participating countries in the G20 summit produced a report including a “growth package”, a set of reforms which the OECD and IMF promise will yield, an oddly specific, 2.1% increase in economic growth by 2018.
Many of these reforms are not really about facilitating fair competition. Instead, they create and sustain private monopolies and tax loopholes. Don’t take our word for it, see the report for yourself. Below are the reforms.
“Reducing regulation and the costs of doing business”
In general, it is a good idea to minimize bureaucracy, and remove particular regulations that maintain artificial privileges (e.g. restrictive taxi licenses). The report does a good job of addressing that issue. In many cases, regulation does fall most heavily on small businesses and new entrants, giving an unfair advantage to large existing corporations.
But in the G20 growth package, this “reduction of regulation” includes the following kinds of policies which are not as competitive, fair, or beneficial as they may seem.
a. Privatizing Basic infrastructure
Utilities and basic infrastructure are often natural monopolies, meaning it is not practical to have a competitive market for them. Take water and sanitation for instance. There is only so much space in a city available for pipes, sewers, etc. It’s not feasible to have many competitors all using different pipes and subterranean tunnels. Giving the privilege of providing vital services to private companies cannot be expected to “boost the competitiveness of the economy and the efficient allocation of resources.” (G20, p. 9)
However, it is sure to create very profitable business opportunities at the expense of the public. To continue using the previous example, if a private company is given the monopoly to provide all of the water for a city, they will charge very high prices. If there is no other way to get water, than to pay the water company, people will pay whatever it costs; nobody can survive without water.
Sure, people would spend more money (increasing GDP) if they were forced to pay ever more in water costs. However, it wouldn’t necessarily mean any more real wealth had been created, or that people’s lives had been improved; it’s quite the opposite actually. Yet, the report implies that everything will be peaches and cream if we focus on maximizing this narrow metric of economic success.
“Observed productivity and price changes in key infrastructure sectors in the 1990s … are estimated to have permanently increased Australia’s GDP by 2.5 per cent.” (G20 p. 5)
b. Reducing Pollution Fines
“The Government has also removed impediments to investment by repealing the mining and carbon taxes. The repeal of the carbon tax alone is expected to reduce annual compliance costs by $85.3 million. Both these reforms will directly reduce compliance costs and will contribute to a more dynamic economy.” (G20, p. 9)
The claim that such taxes would “contribute to a more dynamic economy” is dubious. Instead, it would likely just increase windfall gains for big polluters. Reducing the cost of polluting reduces a company’s incentive to not harm the environment. In other words, it will likely greatly increase pollution. If you want a more dynamic economy and less pollution, simply stop taxing regular people for working and make up for the difference by taxing pollution more.
c. Deregulation of university fees
In our current education systems, the value of a university degree is more in the privileges it grants than the actual quality of the tuition. The biggest personal capital one gains from university are the personal relations and the pre-selection premium to one’s professional status – both of which involve strong network effects. Having gone to Harvard does give one access to certain labour markets regardless of what they happened to learn while studying.
Allowing education fees to soar in high-status universities is likely to cause further polarization of privilege, which reduces social mobility and structural adaptability. The one part of the growth package that actually seems to increase “equality of opportunity” (G20, p. 1) is that the government will be “supporting over 80,000 additional students in 2018 at an estimated cost of $820 million over 2014-15 to 2017-18.” (G20, p. 8) But these suggested public education subsidies and the resulting “price signals” (G20, p. 8) are likely to result in further windfall gains to elite-status universities – instead of encouraging improvements in education quality, as the growth plan insists it would. In other words, universities would simply increase tuition without improving education.
In a market where educational services were separated from assessing professional competence, such competition between the education service providers would be more likely to “improv[e] the quality of tuition”. (G20, p. 8) In the current academic degree paradigm, where status matters and is dependent strongly on the body of students applying to each university, competition is unlikely to work efficiently for the benefit of all students.
d. Tax exemptions and deferment for options used in employee compensation (G20, p. 10)
This looks like nothing but yet another tax avoidance loophole for a few highly paid classes of employees (such as top management). Most employees are not compensated with options in any case, and there is no sensible reason to subsidize compensation in this form over regular wages.
“New investment and infrastructure”
Under current low interest rates, governments are likely to borrow in order to build expensive infrastructure projects. This results in large increases in surrounding land values. If a train station is built for instance, those that own land nearby will see their land’s value increase dramatically, allowing them to charge buyers and renters more. This is an unearned or windfall gain as economists call it.
If however, the value of land is taxed, and owners pay more for owning the best land near the new infrastructure, everyone will benefit equally. Infrastructure can even be constructed using borrowed money that is then paid back with the increased revenue coming from rises in land value. In many cases, it would actually be profitable for the public sector, creating extra revenue for other purposes: increasing access to education and medical care, lowering harmful taxes, and even providing a citizen’s salary (a.k.a. basic income). New infrastructure is great, but not if it is used as a means of raiding the public coffer.
This is part 1 of our coverage of the G20 growth package. Stay tuned for more.
In Ursula K. LeGuin’s fascinating series of “Hainish” novels, the earth’s future is described with the most chillingly brief offhandedness. Hundreds of years before the events these books relate, the home of the “Terrans” was irreversibly poisoned by war and greed. A remnant of the people survived, and went on, over the centuries, to become part of an interplanetary federation — but the Earth’s sad history remained as an object lesson in what can happen to a world whose inhabitants realize, too late, how much damage they’re capable of.
Current events might seem to justify that sort of fatalism. Last week, the IPCC issued its latest report, stating that global climate change is ongoing, irreversible and worse than we thought. As Arctic ice melts, the Russians are building up their Northern military presence, looking toward exploiting newly-accessible fossil fuels (Canada and the USA are also interested). Many of the lawmakers making up the new Republican majority in the US Congress are eager to drill, burn and deregulate. The new Chair of the Senate Environment Committee is Oklahoma’s Jim Inhofe, one of Washington’s most outspoken climate change “skeptics.” Gas prices are down; sales of SUVs and trucks are up. The sky may, actually, be falling.
Meanwhile, though, urban populations are rising, all over the world — and that could possibly be good news. Studies confirm the intuition that city dwellers, who live in smaller spaces, and use more public transportation, have smaller carbon footprints than rural folk (and way smaller than suburbanites). If cities could invest in technology that would make urban life much more ecologically efficient, they could lead the way to a sustainability revolution that could, perhaps, stave off Ursula LeGuin’s dire prediction.
New York, New York, the town so nice they named it twice, is the grandest, richest, most arrogantly potent city in the world. What if New York City were to show the world the way forward — by devoting itself to becoming, as soon as may be, a Green city, creating absolutely the smallest possible environmental damage — even becoming a carbon-neutral city?
Here are ten feasible steps that New York City could take toward becoming a truly green city — while not just maintaining its economic vitality, but actually enhancing it:
1. Use tax policy to incentivize efficient land use.
2. Use the same tax policy to increase funding for public transportation, and make it free.
These first two are by far the most important; they would create the fertile ground in which all the other reforms could grow. But, tax policy is a wonky issue, and I don’t want to lose you — so we’ll come back to it after we’ve considered a few of the snazzier proposals.
3. Drastically reduce private automobile use.
If you’ve ever had the pleasure of wandering around in New York after a heavy snowfall has rendered the streets impassable to cars, you’ve fantasized about how nice it would be if the city could always be that open and free. But… we could never actually do that… could we?
NYC’s public transportation system is really quite good, despite the many strikes against it (overcrowding, funding cuts, deteriorating infrastructure). Millions of New Yorkers (over 55% of households) live without private cars. Imagine the tons of fossil fuel New York City could avoid burning, if no private automobiles clogged its streets!
A congestion-pricing system, such as is used in London, was proposed by Mayor Bloomberg in 2007, and had a lot of support, though the state legislature failed to adopt it. It should. It would be a fine first step. Public transportation options could be beefed up, as the cost of driving in the city increased. The policy could begin in Manhattan, and gradually radiate into the Boroughs.
One of the many ways in which private autos are unwisely encouraged is the low price of parking. Motorists should have to pay the true market value of parking spaces. A demand-based, “smart parking” policy would dovetail with congestion pricing for bridge/tunnel entry points to efficiently begin lowering traffic volume. Prices could be gradually increased, until automobile traffic was drastically decreased. Walkable neighborhoods and all manner of “new urbanist” amenities could be created. Sidewalk green spaces could be expanded. Cross streets could be reduced to one vehicle lane, for emergency or delivery traffic; two lanes of every avenue could be reserved for bicycles.
4. Introduce a tradable credit system to incentivize innovation in green building design.
Last year, the Urban Green Council issued a detailed report on how to reduce New York City’s carbon footprint. Titled “90 by 50,” the report describes steps the city could take to reduce its carbon emissions by 90% by 2050. According to the UGC, 75% of New York City’s carbon emissions come from the building, maintaining, heating, cooling and powering of the city’s buildings. Therefore, creating green buildings, and retrofitting existing buildings to save as much energy as possible, has to play a giant role in any campaign toward a sustainable NYC.
The cost of the “90 by 50” effort was roughly estimated at $167 billion for the whole city, over a period of 35 years. That would seem to be rather a lot; NYC’s entire annual budget is in the neighborhood of $70 billion. Nevertheless: it must be done. Indeed, what is the alternative?
So, how about if we make it interesting? Set a per-square-foot carbon emissions target, well below the city’s current median level. Buildings whose emissions are below that level are issued credits they can sell. Until they retrofit to lower their carbon footprints, buildings with emissions above the target level must buy credits. When more buildings bring their emissions down below the target level, the value of credits will fall — and then the level should be lowered.
Designing a metric for this program would be challenging. It would have to equitably account for myriad ways of reducing carbon footprints: producing renewable energy; increasing green spaces; cutting carbon emissions during every stage of a building’s construction. However, all of those factors can be accurately stated in terms of carbon emissions — our climate-change bottom line. The larger challenge would be to ensure that the metrics would be designed in good faith, and not give easier times to various special interests.
Creating the building stock of a green New York City is a project for the entire city. Feasibly doing it should be a potent source of New York pride. Because the stakes are so high, and NYC is such a vast, visible test case, this should be a municipal policy, effective within the Five Boroughs — and New York City’s tradable carbon credits should not recognize offsets from other places.
What’s wrong with offsets? If it’s the whole world’s atmosphere, isn’t a ton of carbon a ton of carbon? Not necessarily — if our goal is to green our own huge, huffing-puffing city. Tradable carbon credits would be measured in terms of tons of carbon. The per-ton cost of reducing NYC emissions would be considerably higher than, say the cost of saving a ton of carbon by African charcoal producers, or Brazilian rainforest loggers. New Yorkers’ smart play would be to just buy the foreign offsets and continue business as usual at home. But, business as usual is exactly what New York City can’t afford. We should pay the costs, and enjoy the benefits, of our own tradable credit policy.
5. Use Our Kids’ Creative Energy to Market the Program
Kids are always the most fervent and instinctive environmentalists. They don’t need to be told that the natural world is beautiful and worth saving; they need no training to recoil from pollution and waste. Let’s explain the stakes and the strategies of the project to our third, fourth and fifth graders, and get them to create posters and videos on its behalf. Let’s utilize our children’s creativity to make the Green NYC Initiative at least as unavoidable as the latest blockbuster movie.
6. Involve public schools in “neighborhood adoption” programs.
It may have struck the reader by now that, given the reality on the ground, the project being considered is fantastically — maybe even ludicrously — optimistic. Involve our public schools? The deep dysfunction of New York City’s public education system is well-known. The City requires eighth graders to apply to high schools. Families compete intensely for admission to the successful upper echelon of public schools. The system leads inexorably to deep stratification — of school quality, and student success. The City University of New York (CUNY), which accepts all NYC high school graduates, reported in 2013 that 80% of its incoming class needed remedial instruction in reading, writing and math. At the bottom of the heap, forty schools in NYC have been designated as “Persistently Dangerous Schools.” Students have a legal right to transfer out of such a school if they wish, but not all do. The forty schools haven’t all closed; kids still attend them.
Many education reformers and activists, seeking ways to serve the needs of actual students (rather than the demands of standardized tests), focus on the alternative of project-based learning. They argue that many — indeed, most — students don’t retain the contextless facts that traditional education tries to pour into their empty heads. Meaningful learning has a better chance of happening, they suggest, if students can undertake projects that make sense to them. Meaningful learning projects happen in real places, not in school cubicles.
What has this to do with the greening of New York City? Possibly, quite a lot. It’s worth remembering that schools, even failing ones, exist in neighborhoods — and that in the final analysis, the environment isn’t so much where spotted owls live as where we live. The retrofitting of all those NYC buildings (to earn their carbon credits) will take not just a lot of work, but also a good deal of economic and logistical planning. Is that not work that bored, difficult, ill-served public school students could do, and benefit from doing? The average age of a New York City building, citywide, is 76 years! And there’s a strong correlation between advanced building age (and the corresponding energy wastage) and local levels of poverty: the colloquial term for this is “slums.”
The process of retrofitting buildings, insulating, installing windows, etc. is labor- and time-intensive. Often it will be happening in people’s homes; those who are doing the work could scarcely help but get to know the residents. It’s hard to imagine that such a people-intensive project, done for such good reasons (bolstered by a colorful, uplifting ad campaign created by children) could fail to yield very positive results. (Some of the value of carbon credits created by the students’ work could even be donated to school programs.) In a real sense, the greening of NYC would amount to a long-overdue setting-in-order of the City’s house.
It’s well-known that various environmentally-influenced health problems are highly correlated with poverty. The list is long, including obesity, smoking, drug abuse, asthma and STDs. Another phenomenon that correlates with poor areas is “food deserts” — areas in which it’s quite easy to buy cigarettes, lottery tickets and energy drinks, but green vegetables and other healthy foods are expensive and scarce.
Higher-income New Yorkers (whose children attend that top ten percent of successful schools) can take advantage of a smorgasbord of healthy food options. Good restaurants are everywhere. Local food co-ops are prosperous and inviting; the Union Square Farmer’s Market is an oasis of culinary wonderfulness. However, these options are exclusive, both economically and spatially. Organic food stores, stocking local produce, present themselves as being “part of the solution” — and in some ways, they are — but they aren’t sited in poor neighborhoods. Not only that: folks who live in the food desert of East Harlem could, perhaps, hop on the Lex Ave subway and shop at the Union Square market — but by and large, they don’t.
It’s widely admitted that affordable housing isn’t provided by “the market” in New York (and many other cities) and must therefore be subsidized. Evidently the market doesn’t provide affordable healthy food in poor areas, either. Let’s make a public investment in food co-ops in the poorest neighborhoods. Wouldn’t that pay for itself in many ways? Local residents could work in the coop stores in exchange for lower food prices — and the stores could be advertised via our school-kid PR campaign!
8. Create a “Sister City” program to share and spread New York City’s best practices.
The greening of New York City will be an inclusive, organic, multilayered process. High school students will be able to proudly point out buildings they have helped to renovate. The whole campaign will have been promoted by kids’ efforts. Innovation and competition to create new kinds of green buildings will be exciting and newsworthy. The technologies, practices and procedures New York develops along the way will be available for use by any other city that’s willing. What better way to share the progress, then, than to partner up with other metropolises — less prosperous, perhaps, but faced with the same environmental challenges? The greening of nuestra hermana, Mexico City, perhaps?
9. Tax styrofoam containers, plastic utensils and plastic packaging.
Does anyone really believe these things aren’t too cheap? That they don’t entail huge external costs? That they’re desperately needed and no viable substitutes for them exist? Seriously. While we’re a it, other egregiously wasteful products could be targeted for Pigouvian tax treatment, such as non-rechargeable batteries and old-style incandescent light bulbs.
10. Identify and fund organic, natural solutions to flood control, such as oyster reefs.
New Yorkers have always loved their oysters. The delicious, slimy little creatures have been harvested and savored here for centuries. There’s a good reason for that: oysters like to live in the boundary zone where salt water and fresh water meet — and New York’s harbor offered a very large and accessible expanse of such waters. The gigantic reefs, slowly built by trillions of oysters, provided a highly effective natural seawall that protected the area from storm surges. Over the years, though, oyster-gobbling and harbor-dredging did away with the reefs. Eventually, water pollution rendered it impossible even to farm-raise oysters locally (but in recent years this industry has started to come back).
Wetlands also helped to stabilize the shorelines and mitigate erosion and storm damage; little by little, though, they were filled in and built on. In the Netherlands, a country experienced at storm-surge management, large tracts of valuable farmland was simply expropriated for use toward the general good of flood management. Some of this will undoubtedly need to be done along the shorelines of Brooklyn and Queens. A program is already under discussion to compensate homeowners for voluntarily moving out of these low-lying areas.
In the wake of Hurricane Sandy, and as sea levels creep inexorably upward, New York City has no choice but to protect itself against increasingly severe storms and high waters. This represents a formidable engineering challenge, which will have many components. Existing buildings can be modified to make lower floors and underground areas waterproof; levees and floodgates can be built. It’s been prominently suggested, however, that efforts to renew the natural flood-protectors of wetlands and oyster reefs could play a vital role in the overall effort to preserve New York City in an era of rising seas and stronger storms.
1 & 2: What was that about Tax Policy?
We said above that the most important aspect of this entire program, the thing that would make every other part practicable, is to adopt a tax policy that would 1) Incentivize efficient land use and 2) Increase funding for public transportation, and make it free. Now, what sort of tax policy could be expected to do those things?
It would have to be quite different from what we have now. On these two pivotal issues — efficient land use and effectively funding public transportation — current tax policy pushes New York City in exactly the wrong directions.
The vastness and dynamism of New York City serves to obscure the fact that NYC is very significantly under-built. Citywide, the average building has only 51% of the indoor space that zoning allows on its site. In Manhattan’s Community District 5 — Midtown, the city’s highest-built area — 42.9% of sites have buildings that are less than half the allowable size (and 41.8% of the buildings in that district were built before 1940). Manhattan has 399 acres of privately-owned vacant land. Another 1,228 acres in Manhattan are all but vacant: they sport buildings whose assessed value is 20% or less of the value of the land they’re on. (Source: NYC Dept. of Finance Assessment Rolls)
Does it make any sense for the most expensive real estate in the United States to be so drastically underused? In terms of environmental sustainability, it’s clear that if people are not living and working in the densest, best-connected urban spaces, then they are doing so sprawled somewhere further out — using more roads, burning more gas, doing everything more wastefully, less synergistically. To see how this process Our tax system reinforces this behavior, by rewarding people for holding urban land as an investment, and by penalizing them for building. These bad incentives could be reversed by simply progressively decreasing the property tax applied to buildings, and increasing the tax on the land that lies beneath them.
Such a tax shift, in it’s unadulterated form, would have many benefits. Examples include drastically reducing urban sprawl and poverty. Normally, taxes are seen as an unfortunate necessity, a penalty that serves to reduce our supply of the things we want. This is not true of a tax on land value, however, because land value is not produced by the land’s owner; it is produced by the surrounding community, and public investment in making that site safe, efficient and desirable. A tax on land value simply recovers those community-created values.
Building a house on a nice little piece of land somewhere is still something that normal people can more or less accomplish on their own. This leads us to think of real estate as just one sort of thing: a building on a piece of land. In cities, however, because of the size and great risk of development, the real estate business divides into two essentially antithetical parts: the developers, who design, construct and operate buildings — and the land speculators. The latter group just holds sites. Perhaps they hold them entirely idle. More often, though, they put them to some minimal use, enough to pay the property tax (since there is little or no valuable structure on the site, the conventional property tax is, relatively, very low). A surface parking lot is ideal for this; so is a fast-food franchise.
To sum up a long story, then: we could stimulate efficient land use in cities by taking the community-created rental value of land out of speculator’s hands, and using it for public revenue. This was the proposal made by the American economist Henry George in his 1879 worldwide bestseller, Progress and Poverty. In recent years, this principle has been affirmed by such prominent economists as Joseph Stiglitz, Richard Arnott and William Vickrey, in what they call the Henry George Theorem. In essence, this theorem holds that public investment is reflected in land values — and that to the extent that local public investment is efficient, its cost can be completely paid by a levy on local land rents: no other revenue source is necessary.
This principle is perfectly obvious in the case of one vitally important fixture of urban life — which is, moreover, crucial to environmental sustainability: public transportation. The effect of high-quality public transportation on land value is well-known — so much so that “near trans” is a standard rent-justifying item in rental ads.
The Henry George Theorem implies that were the MTA funded by the land value that its service creates, there would be enough revenue to not only operate it, but to eliminate fares. (After all, someone who commutes to work every day pays over $1,300 per year in subway fares. That is part of what people are willing to pay to live in New York — so we know that eliminating the transit fare would raise land rents by that amount!)
The Tax Shift would Support Green Buildings
The property tax on buildings is a significant part of their annual cost; therefore it influences what gets built, the economic viability of various developments. It’s one big reason why “affordable housing” is seen as chronically unprofitable — and why new developments tend to be so big, and so luxuriously high-priced.
It’s generally true that tall buildings tend to be more energy-efficient than small, sprawled-out buildings surrounded by lots of pavement. It doesn’t follow, however, that a skyscraper like 432 Park Avenue, with its 10×10 foot windows on every wall, are bastions of sustainability.
Our proposal to set up a tradable-credit system to create green buildings would dovetail perfectly with the shift to land value taxation. The tax shift would remove taxation from buildings. The tradable credit system would effectively retain the taxation of buildings, to the extent that they failed to reduce their carbon footprint. Thus, not only would wasteful, inefficient buildings be taxed, but they would be taxed in an environment in which efficient buildings were simultaneously being un-taxed! If the city were to simultaneously adopt land value taxation and tradable credits for green buildings, their beneficial effects would reinforce each other.
What Are We Waiting For?
Climate change isn’t a “maybe.” It’s here. But the steps outlined are a win for everybody. There’s a tax-shift advocacy group that says, “New York City: the best place in the world — but it could be a whole lot better!” This town has the wealth, the spirit and the chutzpah to show the entire world how a prosperous and sustainable 21st-century city is done: without federal help, without, possibly, even Andrew Cuomo’s permission. So let’s get started. The alternative isn’t good.
It has been suggested that the Ebola crisis is less a public health crisis than an inequality crisis. My first response upon hearing this was, “Ya think!?” No blame to Jim Wallis for saying it; I’m glad he did. But the fact that it needed to be said is troubling, to say the least.
Thus far, the American political and media response to the news about Ebola has left me feeling ashamed of my country. Our outbreak of posturing and wagon-circling has been American Exceptionalism at its tawdriest. Respected people, astute enough to sit on the Congressional Homeland Security Committee, urgently demand that we “seal the borders! Ban flights from West Africa!” Why hasn’t Obama done that already?
Seal US borders?
Among the many reasons why that’s a bad idea, the most obvious is that there are hundreds of alternate routes; for a ban to be effective, it would have to be worldwide. But, it would be impossible to enforce a worldwide travel ban; people would sneak into all manner of places, making exposures that much harder to track down. Also, there is wide agreement that the need for people and resources to help fight the West African outbreak is so great that it cannot be met without the resources of commercial airlines.
I suppose it’s understandable, though, that we’d be a little freaked out by a gigantic outbreak in West Africa of a fatal disease that manifests itself in such symptoms as high fever, headache, vomiting and diarrhea. In Sierra Leone, currently the epicenter of this outbreak, some 7,500 people, mostly children, have died of it in the past year.
No, I’m not speaking of Ebola, but another disease: malaria. Sierra Leone has the world’s highest death rate from malaria. (It also has the world’s highest death rate from tuberculosis, which kills even more West Africans than malaria does.) This year, Ebola has killed a (comparatively) modest 3,000 people in Sierra Leone.
Not All the News from Africa is Bad
There has been some good news out of Africa recently. Economic growth is taking off, and a new middle class is emerging in many countries, skilled at leapfrogging into 21st-century communications via mobile phones. Innovative entrepreneurs are creating devices that bypass infrastructural deficiencies to meet the needs of real Africans. South Africa and, especially, Botswana are making real strides against government corruption. At the moment, the most compelling piece of good African news is the way Nigeria has carefully, methodically — and so far, successfully — controlled the threat of an Ebola outbreak. It could have gone far differently. Lagos, Nigeria’s capital, is a city of 21 million people.
If Nigeria, a country that’s infamous for epic mismanagement and corruption, can do what it takes to contain an outbreak of Ebola, then surely the United States can do it — and, initial missteps aside, the US almost certainly will do it. But, it is a costly, and tricky, process. Ebola is only contagious when victims have already begun to show symptoms — which occurs after an incubation period of up to 21 days. Those symptoms include severe vomiting and diarrhea, and patients can decline rapidly. As their disease becomes more acute, the concentration of the virus in bodily fluids increases; this means that health workers (or family members) caring for acute Ebola patients are at the greatest risk.
Equipment, and techniques, exist for dealing with such patients. However, they are expensive and cumbersome; practitioners have to be carefully trained. It can be done, though: in late September, CNN aired a report on how one woman in Liberia cared for four family members with Ebola without getting infected. We all hope the two Dallas nurses who contracted Ebola will recover soon. It is not the least bit surprising, though, that there would be initial hiccups in a nation’s response to such a tricky disease. Make no mistake, though: nobody, anywhere, thinks that people in the United States need to panic (nobody, that is, except the cynical self-promoters who seek to gain from our panic).
Sierra Leone & Liberia
Sierra Leone and Liberia have made great strides toward economic and social stability in recent years. With their devastating civil wars behind them, their economies have been growing at rates of 11-13% . Two Liberian women, Ellen Johnson Sirleaf — the first woman to be elected President of a modern African nation — and peace activist Leymah Gbowee shared the Nobel Peace Prize in 2011. Liberia and Sierra Leone are comparable in size to North and South Carolina. They have long, lovely Atlantic coastlines, and are amply endowed with arable land and various natural resources.
The Carolinas have a combined economic output (GSP, Gross State Product) of $656.4 billion, while Sierra Leone and Liberia have a combined output of only $13.4 billion (GDP). Alas, these two nations are in no shape, in terms of medical infrastructure, to even combat the devastating diseases they were struggling with before the Ebola outbreak, diseases including: malaria, AIDS, dysentery, etc.
Some selected statistics (from the CIA World Factbook) should be enough to illustrate the point:
People under age 14
People per doctor
Female literacy rate
GDP per capita
Population below poverty line
In June of this year, Sierra Leone closed all schools due to the Ebola outbreak. In October, a school-by-radio program was announced. Its effectiveness will be limited, however, because only about 25% of families in the country own radios.
I have been emphasizing Sierra Leone because it is simpler to gather numbers for a single country, but most of what I’m saying about Sierra Leone applies to Liberia even more strongly. Indeed, it’s not easy to see why they benefit from being separate countries. Sierra Leone’s colonial history was tied with Great Britain while Liberia’s was with the United States, but their colonial, and post-colonial, politics were the same. Both powers cultivated tribal elites for powerful “overseer” roles that transferred intact into post-colonial politics. Recently, aided by the machinations of Liberian warlord (and convicted war criminal) Charles Taylor, both countries became embroiled in brutal civil wars. The war in Sierra Leone killed 50,000 people; Liberia’s killed more than 200,000.
This histories of Sierra Leone and Liberia are of course complicated. However, for the purpose of understanding their current health crisis, it is sufficient to oversimplify. They are both a product of colonialism. Boundaries were drawn in line with European interests, pitting rival groups against one another as part of a system of divide and conqueror. A class of elites/political pawns were posted to ruling positions. When independence came, the elites were poised to consolidate their power. In the Cold War political climate of the time, regimes vied for gifts of money and weapons from either the Soviets or the West. Political control bounced back and forth between “socialist” and “anti-socialist” regimes, but domestically the labels made little difference. People’s needs were never well-satisfied, which made them receptive to the promises of each new rebel faction that seized control.
From a distance, people are tempted to ask why these people can’t get their act together — but the reasons are not hard to decipher. According to many experts such as Paul Collier and Pádraig Carmody, perhaps the most important source of continued poverty and conflict in West Africa is natural resources. For example, Sierra Leone’s largest export is unsorted diamonds — precious stones scraped out of the ground and sold for much less than their improved value at, say Tiffany’s. The URF rebels in Sierra Leone paid Liberia’s Charles Taylor in diamonds for the weapons they used to escalate their civil war.
How much would it cost to wipe out Ebola?
I live in Central Maine, which, by US standards, is not a wealthy place. Frequently I see donation jars, in local stores, for a family whose house has been lost in a fire, or who has been visited with a very expensive injury or illness. People invariably fill those jars, but only after disaster strikes are they willing to give. It may be harder for us to wrap our minds around the suffering our neighbors in West Africa -but make no mistake, they are our neighbors. Our esteemed Congressional representatives have been making that point over and over, by telling us how easy it is for them to come and visit us.
At the national level, though, the cost of turning this terrible situation around is comparable to the small change I might toss into one of those local-relief jars. That may be hard to believe, but it really is. After the 2004 tsunami in Indonesia, the US sent 12,600 military personnel to a relief and rescue mission, various governments contributed $5 billion in direct aid, and private donors raised still more. Did that scale of relief effort cause any economic hardship? Does the reader even remember this?
The F-22 fighter jet just went on its first combat mission, successfully dropping bombs on an ISIL command-and-control building in Raqqah, Syria. The United States has a fleet of 190 of this state-of-the-art stealth fighter, at an overall cost of over $36 billion.
The US Navy has twelve full-size aircraft carriers. When one of these behemoths goes to sea, it does so with a retinue of ten escort ships; operating a single carrier battle group costs roughly $900 million per year.
I think we can afford to invest the funds necessary to prevent preventable diseases in West Africa. Don’t you?
Long Term Solution
We need to render such nations less vulnerable, unilaterally — by promoting democracy, transparency, and economic freedom. Economic freedom would consist of taxing these countries’ vast natural resources, and using the funds to improve medical infrastructure, among other things. Oil and diamonds are obvious examples, but the most important resource, one which all countries have, is land. Taxing it as a function of its market value would break up large feudal land holdings, making it available for poor subsistence farmers. In time, such a system would bolster domestic markets and reduce dependence on bargain-priced exports (and foreign loans). But it’s very hard to establish reasonable, sensible, long-term reforms when so many people, especially children, are dying before your eyes.
P.S.: The Impulse to Panic
Since the above article was filed, it has been reported that a doctor who volunteered in Guinea for Doctors Without Borders and returned, symptomless to New York City, has been diagnosed with Ebola. Before that, apparently, Dr. Craig Spencer did some normal traveling about the city. “See! See!” scream our friends at Fox News. Dr. Spencer was very familiar with Ebola’s pathology. He monitored his own condition carefully, and followed established procedures as soon as he developed a fever. (Initial reports that his fever was 103 degrees turned out to be a transcription error: it was actually 100.3.)
A woman, a nurse from New Jersey, was quarantined upon arrival at Newark Airport, and she has since developed a fever. This was done under a new policy announced by Governors Andrew Cuomo and Chris Christie; their two states will go beyond the Centers for Disease Control’s recommendations and impose a 21-day quarantine on medical workers returning from Ebola-stricken countries. New York and New Jersey will also impose tougher screening procedures on people arriving from Liberia, Sierra Leone and Guinea than those required by the federal government.
According to the Centers for Disease Control, it is likely that the NY/NJ restrictions will mean that fewer health workers will be willing to volunteer in West Africa, at a time when every possible hand is needed. The CDC has announced a new “active monitoring” system that seeks to severely limit the risk of new Ebola cases without the harmful effects of a travel ban or automatic quarantine.
Thus far there have been five cases of Ebola in the United States, and one death. It seems that Congressional Republicans and other fear-mongers won’t be satisfied unless there are no new cases — but that is not a realistic goal. We live in an intensely interconnected world, and freedom entails some risk: there are going to be some cases. I wonder how long it will take for the US Ebola death toll to reach 9 individuals. That’s the number of Americans killed, so far in 2014, in school shootings.
California, among many other places, is now in the grips of a freakishly intense drought. Yet, the state still wastes an awful lot of water. Golf courses and car-washes are obvious wasters, but agriculture is the thing that really sucks California dry.
As a whole, it diverts or pumps 43 million acre-feet of water each year to supplement its meager rainfall. In total, agriculture consumes 34 million acre-feet of that.
The economics of this can get a little bizarre. Water in California is heavily subsidized — a big reason why so many water-intensive crops are grown there. Fruit and nut trees need more water, but they also bring in much more revenue per acre than vegetables or other crops — and, they represent a long-term investment. That means that if water is scarce, farmers will tend to use it on the biggest water wasting crops. For example, almonds use a stunning 1.1 trillion gallons of water each year, enough for every person in the state to take a luxurious 22-minute shower every day. California produced 82% of the world’s almond crop in 2013.
According to Big Picture Agriculture, “Many of the methods known to conserve water and use it efficiently have been practiced for thousands of years in some very arid regions of the world with great success. The best systems require little maintenance while yielding maximum results.” The site goes on to list 35 methods, viable at a range of scales, for conserving irrigation water. Why are these methods not widely practiced in California? Essentially it’s because farmers are paid to waste water.
Of course, the problem is compounded when water is used to create products that are deeply wasteful in themselves. Producing a gallon of ethanol, for example, requires 193 gallons of water (see the Food and Energy sections below). The US plans to pare down ethanol production to a mere 15 billion gallons in 2015.
We feel guilty when we forget a container of leftovers in the fridge, it grows fuzz and we have to toss it, and I shudder to think how many tons of the nation’s french fries (not to mention our lettuce) get tossed into the trash. But to get a handle on the immense amount of nutrients today’s food system wastes, we have to go to the top of the food chain: we have to look at meat.
A lot has been written about all this; Fast Food Nation by Eric Schlosser, for example, lays it out in gruesome detail. But for introduction, a well-documented New York Times article from January, 2008 does the job nicely. Here are some of the facts it presents:
The world’s total meat supply was 71 million tons in 1961. By 2013 it rose to 308 million tons.
2.2 pounds of beef is responsible for the equivalent amount of carbon dioxide emitted by the average European car every 155 miles.
Though some 800 million people on the planet now suffer from hunger or malnutrition, the majority of corn and soy grown in the world feeds cattle, pigs and chickens.
About ten times more grain is required to produce the same amount of calories through grain-fed beef as through direct grain consumption.
Iowa alone produces 137,000 tons of pig excrement every day.
There can be no doubt that a system that subsidizes meat, by subsidizing grain, is detrimental both to the planet and to the health of all those meat-eaters, not to mention the suffering inflicted on the animals being slaughtered. To put it bluntly: it’s a heck of a lot of waste.
And it goes beyond mere eating. We’ve already mentioned the global poster child for insanely wasteful resource use: ethanol. A third of the US corn crop is used to produce the stuff. The world’s #3 producer of corn is Brazil (China is #2), but Brazil produces only a third of the amount of corn that US drivers burn in their cars.
There are so many ways to talk about our society’s waste of energy. We could discuss the sheer wattage of solar radiation that hits the earth each day, and the falling price of photovoltaics, or the untapped potential of wind and tidal power sources, or the astounding savings that could be found in ramping up public transportation, and using energy-efficient vehicles. A 2009 cover story in Scientific American showed how the entire world could get all of its energy — for transportation as well as electricity — from wind, water and solar sources by 2030, using tweaks to existing technology.
Of course, we can’t discuss the waste of good energy resources without mentioning the squandering of both human and material resources in wars, and preparation for wars, over the control of fossil fuel resources. Our immense military establishment is, of course inherently wasteful — because military assets are designed to be consumed in the task of destruction. Not only that, military operations themselves use staggering amounts of energy. Here are some astounding examples:
The US military consumes more energy than all of Nigeria.
In 2006 alone, the Air Force consumed the same amount of fuel US airplanes consumed during WWII (between December 1941 and August 1945): 2.6 billion gallons.
F-15 fighter jets burn 1,580 gallons of fuel per hour.
Over 70 percent of the tonnage required to position today’s US Army into battle is fuel.
Why do we squander our energy resources so outrageously, when we know that continuing to burn fossil fuels will bring disastrous, irreversible consequences? It’s because the alternatives are, basically, unthinkable to the current political establishment. I’m not saying our energy alternatives are unworkable, impracticable or even present too hard an adjustment. The problem is that in terms of our political economy, our international relations, our sense of who’s on top and in control, they’re unthinkable. Imagine! They’re saying we need international cooperation to protect the global climate. Up to now, international relations has always been about self-interest: individual and corporate, mostly, though occasionally people pull together for the sake of national self-interest. But to deal with climate change, we must appeal to global self-interest. That’s still self-interest, mind you, but it’s far more enlightened.
By 1600 the British Isles were pretty much cleared of timber, save the inviolate estates of nobles. One of the pressing concerns that led to the earliest North American settlements was the prodigious supply of wood to be found there. Wood was the first cargo that the failed Virginia settlement of 1608 tried to send back. The pattern was repeated in the United States. Prior to the civil war, wood provided over 90% of fuel for homes and industries in the US. The coal was there — it was already being used extensively in Britain — but the States had a well-developed and influential timber industry. The bottom line is that we persistently wasted wood in the United States until we truly had no other alternative.
4. The Vote
We US citizens are justifiably proud of our democratic, constitutional political system — yet one wonders why we make so little use of it. I live in the little town of Jackson, Maine, pop. 548 in the 2010 census. People in Maine are proud of their democratic traditions and protective of their suffrage; recently Maine resoundingly defeated a ballot issue to do away with same-day registration, and we’re one of only 14 states that allows convicted felons to vote. But — our most recent election was an off year: no national, state or even local offices to be decided; it turned out that the only thing on the ballot was the school district’s budget. Now, the school budget is an issue about which a lot of people in our little town have loud complaints and strong opinions. I went in to vote at about four in the afternoon. “Slow day?” I asked the dutiful poll-watcher lady. She sighed and consulted her clipboard. “You’re number six.”
Average voter turnout in the United States in the 28 national elections since 1945, in terms of the portion of the voting-age population, is 47.7%. That’s 138th in the world. The top ten in voter turnout are emerging democracies that had only had a few elections during that period. But Australia has had 22 elections since 1945; their turnout rate has averaged 84.2%.
It could be that we’re jaded about voting because there seems to be so little to vote for; American politics is mired in partisan gridlock and big-money influence. The current US Congress has single-digit approval ratings, but guess what! Because of the magic of gerrymandering, the number of incumbent congresspersons who will lose their bids for reelection will most likely be in the single digits! Thus, the most expensive election in world history (under current rules, every US election will almost certainly cost more than the previous one) will yield the absolute minimum amount of actual legislative or policy change.
There are commonsense reasons why citizens really ought to use their voting power. The most basic one is that when fewer people vote, the groups who are more likely to vote gain more power over the overall outcome. This basic fact is powerfully used by politicians and their strategists. The 2000 presidential election in the US was very close; much was made over a few thousand contested votes in Florida, and the 2.7% of the popular vote that Ralph Nader managed to get. Nevertheless, George W. Bush was “elected” by 47.9% of the popular vote, which amounted to 27.4% of the voting-age population. Think voting matters?
In 1904, New Yorkers thought their brand-new subway system was the swellest thing ever. And it was! It expanded rapidly, growing into world’s largest railway system, efficiently moving millions upon millions of people to work, to play at Coney Island, to cheer at Yankee Stadium. The New York subway stuck to its five cent fare until 1948. By that time, of course, there were lots of automobiles in the city; in 1904 there were only horses.
The city of Austin, Texas is known as the state’s least scary city to non-Texans. It has the U. of Texas Longhorns, nice museums, an incredible music scene, and interesting historical spots — all in all, a nice place to visit. But it’s rough on unfamiliar drivers. Austin is encircled by ring upon ring of elevated, limited-access highways with endlessly sweeping ramps; it can literally take you twenty minutes to reach a destination that is visible from where you’re standing. “You think this is bad,” say Austin people, “Wait til you see Houston.”
People in Austin wonder whether its already Texas-sized highway system will be able handle the traffic load in a few years. Things get pretty backed-up during rush hours — and, all those new flyways will need to be maintained. That’s not a trivial issue. I have been traveling in and out of New York City on I-95 for many years, and I don’t recall ever not seeing construction on the stretch between New Haven, Connecticut and the New York State line. That means that at existing levels of traffic, using existing road-maintenance techniques, this stretch of highway simply cannot be fixed before it wears out.
There are a zillion examples of other mind-bendingly egregious waste. This is public infrastructure that your tax dollars have bought. I’ll just make one more observation before moving on. Infrastructure capacity is the most important consideration in how cities arrange zoning requirements. If zoning allows, say, twelve-story buildings with a certain footprint in a neighborhood, you can bet that the city figures it has sufficient water, transportation, education and public-safety facilities to handle buildings of that size. Would you care to hazard a guess at how much of the zoned-for, buildable space in New York City is actually built, as of this year? Fifty-one percent. Other major cities are even less densely built. Our cities could hold a whole lot more people than they do, and these people could significantly lower their environmental footprint by moving into cities — and even more so if cities embraced green building techniques. Yet we keep pumping out the parking lots, the beltways, the big-box superstores…
6. Borrowed Money
There is, by many accounts, a debt crisis in modern society. The national debt of the United States stands at about $17 trillion, or some $55.9K per citizen, which is a bit more than the US’s personal debt per citizen, which stands at $52.2K. The US Debt Clock website shows many interesting facts; its numbers adjust in real time, which lets us see that our national deficit is currently decreasing by about two thousand dollars per second. Also, US debt held by foreign countries, which stands at around $5.9 trillion, is currently decreasing by some $4K per second. So the trend lines seem to be positive — but any way you slice it, it’s still a lot of money to be owing.
As wages and household incomes have declined, people have taken on more and more personal debt. As of 2012, the average US household with at least one credit card owed $15.9K in credit card debt, much of it at high-teens interest rates. But, of course, not every family can get a credit card. Payday and car-title lenders lie in wait for the vulnerable. Some states, such as Texas, do not place any limits on the rates such lenders can charge.
But, you might ask, why is “borrowed money” placed in the category of things that are wasted? Well, it’s wasted, by definition, if new loans are taken out just to pay back old ones. Consumers who do this often find themselves in a spiral of debt, leading to bankruptcy, and permanent economic hardship. “Deficit Hawks” warn that our nation faces this predicament too. There are significant differences between the finances of a nation and those of a family: the nation can, within limits, print its own money. However, money can’t just be inflated or borrowed forever without consequences.
Not everyone borrows out of desperation; businesses often borrow money because they can make more profitable use of the cash they have on hand. Nations, similarly, can choose to borrow during economic downturns, times when raising taxes would further depress the economy. Such borrowing can be seen as sensible and sustainable.
However, if one is borrowing more than one would prefer to borrow, then one will most likely not be borrowing on the most advantageous terms. Problem borrowing comes when one just doesn’t have enough income to pay the bills. That’s the borrowed money that gets wasted, and its amount increases when the economy turns downward, and when there are more poor people.
7. Human Potential
And yet, modern society perpetrates one waste that is bigger — much bigger — than all of these.
[The] greatest of all the enormous wastes which the present constitution of society involves is that of mental power. How infinitesimal are the forces that concur to the advance of civilization, as compared to the forces that lie latent! How few are the thinkers, the discoverers, the inventors, the organizers, as compared with the great mass of the people! Yet such men are born in plenty; it is the conditions that permit so few to develop…. Turn to the lives of great men, and see how easily they might never have been heard of. Had Caesar come of a proletarian family; had Napoleon entered the world a few years earlier; had Columbus gone into the Church instead of going to sea; had Shakespeare been apprenticed to a cobbler or chimney sweep; had Sir Isaac Newton been assigned by fate the education and the toil of an agricultural laborer… what would their talents have availed? But there would have been, it will be said, other Caesars or Napoleons, Columbuses or Shakespeares…. This is true. And it shows how prolific is our human nature. As the common worker is on need transformed into queen bee, so, when circumstances favor his development, what might otherwise pass for a common man rises into a hero or leader, discoverer or teacher, sage or saint. So widely has the sower scattered the seed, so strong is the germinative force that bids it bud and blossom. But, alas, for the stony ground, and the birds and the tares! For one who attains his full stature, how many are stunted and deformed.
I have always been left-leaning. I believe there should be economic justice and equality of opportunity for all. My biggest early influences were FDR, Olaf Palme, and Nelson Mandela. My first serious political involvement started when I attended a 2008 Democratic presidential rally for Hillary Clinton. I attended with my mother and her friends in my hometown of Springfield, Missouri. My family is dedicated to the tenets of modern liberalism: equality, universal prosperity, and a moderate amount of government regulation of the economy. Since 2008, I went even further to the left, identifying myself as a social democrat, and promoting a large expansion of social programs.
Scandinavian Socialism, Only Better
I first became interested in the idea of Earth Sharing, particularly Land Value Taxation, about a year ago. I believed that the only, or at least the best, way of achieving such ends was more regulation, higher income taxes, new wealth taxes, and expansion of government programs in general. I still believe that doing these things would be far better than what we have now, but Land Value Taxation seems to be the most important bottleneck to reducing inequality.
Land Value Taxation fell in my lap when I was browsing Wikipedia (yes, I am one of those people). I looked at it and thought that this was a good tax; it collects quite a bit of revenue and it could fund social programs. But I was skeptical of its benefits. Would it be enough to fund a welfare state?
The Best of Both Worlds
Earth Sharing made me aware of the possibility that equality need not be at odds with economic efficiency. I started appreciating more of the benefits of the market economy. The following ideas aren’t necessarily Earth Sharing stances, but they’re still relevant to understanding my intellectual evolution. I started to grow less wary of some forms of deregulation. I was worried about getting rid of certain occupational-licensing laws, but then eventually accepted that doing so can reduce the cost of hiring.
Soon after, I committed an anathema for a social democrat, questioning the minimum wage. While minimum wage is a beneficial reform, I found something even better, something that lifts people out of poverty, is less expensive to administer, allows a large degree of freedom, and doesn’t hurt the economy—the basic income.
A Basic Income for All
A basic income is just that, a minimum income that all citizens get -regardless of lifestyle choices. A basic income for all provides people with a social safety net, without discouraging them from working, unlike unemployment compensation. If you are currently getting unemployment benefits, and you start working, you stop getting those benefits. This makes getting a job less enticing. This wouldn’t happen under a basic income because everyone would get money, regardless of whether they worked. This would be an immediate safety net for everybody, enough for food, shelter, and medical care.
A basic income is less costly to administer than unemployment benefits. This is because it’s expensive to monitor and hassle the unemployed about whether they are looking for employment, or if they are being paid for unreported work. Why not just give that money, currently being wasted on bureaucracy, directly to all citizens?
Sharing the Earth to Save the Earth
What’s the best way to fund such a basic income? While it’s not the only way, Land Value Taxation would do the most good. Land Value Taxation has many other benefits as well. It increases the housing supply and curbs gentrification. It opens up vacant lots in urban areas for housing, jobs, parks, and other public places. Land Value Taxation also reduces sprawl, and thus the tremendous environmental damage it inflicts.
In general, Earth Sharing offers the highest impact way of reducing inequality, but also does so without harming individual freedom, the will to work, or the market as a whole. I still support social liberal policies, but they do not have to be so bureaucratic and wasteful. There are better ways to achieve a world of freedom, equality, sustainability, and justice.
How a Libertarian Came to Earth Sharing
by Daryl Sawyer
I have been asked to share the story of how I became a supporter of Earth Sharing. This story may be of interest to readers on this site due to the personal transformation it describes: how a right wing libertarian came to be someone who, in the eyes of many of his former compatriots, is a communist. I began as someone who believed that, while poverty was unfortunate, it was necessary to ensure that every person does their part.
In the middle of my transition, from right to left, I was prepared to support a “grand bargain” between libertarians and what are commonly called “liberals” or “socialists” to replace the existing welfare system with some sort of direct income subsidy (whether by the name “Guaranteed Minimum”, “Reverse Income Tax”, “Citizens Dividend” (my preference), or what have you.
Progress and Poverty
It started with Carl Milstead’s holisticpolitics.org. It was kind of a revolutionary approach to someone who had spent most of his life as an embittered and cynical libertarian. There I found “quiz2d” which steered me toward Henry George.
I read Progress and Poverty and was enthralled by it. I was particularly impressed by how land theory creates a space for the State and a certain amount of (p)redistribution in a mind then immersed in anarcho-capitalist theory. It was a revelation: a political philosophy that was pragmatic without abandoning principle by so much as a single jot.
Want Liberty? You’ll Need Equality.
Over the years, I’ve come to realize that a lot of the libertarian sacred cows just aren’t really that important. Economic injustice is the cause of our lack of freedom, not the other way around. So while others talk about a “grand deal” in which the existing welfare system is replaced by a basic income, I’m perfectly comfortable just cutting the checks, and then relying on a financially liberated populace to pare back the State wherever it seems to make sense, and leave it in place where it doesn’t. In the paragraphs below, I will describe precisely how I managed to get to here from there.
Growing up Conservative
You might say I was “born libertarian”. My father was a non-religious conservative, a supporter of men like Ronald Regan and Barry Goldwater. It is from him I absorbed that most basic of libertarian ideals: that it is better to leave people alone, let them handle their own problems their own way, than to meddle in other people’s affairs.
But, like I said, I also spent a lot of time on the Internet taking personality quizzes, political quizzes, and so on, and in the process discovered holisticpolitics.org. This was the first place I encountered serious thinking about ways for traditionally opposed political factions to compromise in ways that advance the interests of both sides. Having spent most of my life as a cynic, it was a revelation. But even more interesting was one particular thinker, and one particular book: Henry George’s Progress and Poverty.
Progress and Poverty
I devoured that book like a starving man. I found the hopefulness of his prose every bit as appealing as the novelty of his theory. Up to this point, I knew nothing about land other than it was one of three “factors of production” in classical economic theory, and I think the last time I’d heard anything about that was high school economics. Henry George explored the nature of land and the role that land ownership plays in the distribution of wealth. The conclusion, that our institutions of land tenure are the cause of the gap between rich and poor, and that addressing this would go far to remedy that gap.
Getting in Touch With My Left Side
Up to that point, I considered the ideal political arrangement to be an unattainable one: one in which every person’s liberty and property are respected. Under such a system, I believed, there was no room for government; government is necessarily the compromising of some liberty and property to achieve certain ends.
Rather than making the “left wing” parts of my philosophy conditional on acceptance of the “right wing” parts, I now do precisely the opposite. This might be due merely to the extraordinarily bad behavior displayed by the American right wing in recent years, but I think it goes deeper than that.
Most Libertarians Have it Backward
Libertarians believe that excessive regulation leads to a stunted economy, which leads to a perversion of the distribution of property, which leads to suffering. I now believe it is the unjust distribution of property that leads to a stunted economy, which leads to suffering, which makes the population vulnerable to every kind of demagoguery (both right wing and left wing). This leads to regulation, which is a mixed bag in terms of what makes things better and what makes things worse.
Same Values, Enlightened Application
But understand this: underlying this entire process, that most basic ideal, the one I acquired as a child, has not changed. I bring this up because I see, in the Geoist community (and more so in the larger egalitarian economics community), a profound distrust of libertarian types. It’s understandable. The libertarian “program”, fully implemented, would indeed result in a plutocratic dystopia. But among sincere supporters, this is not the goal. It is, rather, the result of an incomplete understanding of economics.
My impulses are still “libertarian” in nature. I still prefer less government to more. This is why I favor a larger dividend instead of a larger government, for example. The goal, the vision I would like to see implemented, is the same now as before: one in which every individual is free to live their life as they prefer, provided their choices do not prevent others from doing the same. Only my understanding of how to achieve this has changed.