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Canadian Green Party Economist Frank de Jong: Tax=Resource Rent
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by Maireid Sullivan | March 9, 2010 at 09:24 pm
511 views | 2 Recommendations | 7 comments
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Frank de Jong served as Leader of the Ontario Green Party from 1993 through to November 2009, when he resigned in order to direct his efforts toward serving the Green Party's national agenda.
March 5/6 he presented his Green Pary Financial Policy Resolution at the Canada Economics Forum.
Anyone who wants to know how Resource Rent can be implemented (aka: Classical Political Economics, Single Tax, The Law of Rent, Land Value Taxation (LVT), Ricardo's Law, Georgist economics, etc.), will find this submission illuminating. Download this Resource Rent course to get acquainted with the principles.
Frank de Jong's blog has the full text of this resolution, including comprehensive details and numbers to support his resolution. As he says, "theory is fine, but it takes numbers to get attention."
i) Therefore the GPC proposes to employ natural resource charges so that those who use, monopolize or despoil our common wealth are obliged to reimburse society for this privilege;
l) Therefore the exclusive use of resources and land by individuals, institutions and businesses will require compensation to those excluded, i.e. those who hold resources or preferred sites, will be required to remit fees equal to the unearned economic rent as public revenue for public benefit (in lieu of income, business and sales taxes)
De Jong's plan aslo makes allowances for those who protect the environment and punishes those who pollute it.
n) Therefore individuals, institutions or businesses granted the privilege of polluting will remit to government Pigouvian taxes as deemed appropriate by legislators;
o) Therefore the GPC further proposes that those who contribute back to the commons be financially compensated by government. Companies and individuals who forgo opportunistic income to conserve, protect or restore ecosystems will be reimbursed for expenses.
Review the full resolution on de Jong's blog as well as comprehensive numbers to support this resolution.
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Maireid Sullivan
Melbourne, Australia
Most RecentMost Recommended Comments (7)
at 13:32 on March 17th, 2010
The numbers aren't Green they are Rose Coloured since that is the colour of the glasses the author was clearly wearing when he wrote this very short, poorly researched paper. He should study an economic concept called "Elasticity of Demand" and be familiar with other concepts like the Mobility of Capital and the Substitution Effect.
When you tax a consumption good demand for it goes down, that puts workers out of jobs. When you tax financial transactions those transactions shift to lower tax regimes and that puts workers out of jobs and when natural resources are highly taxed resource extraction moves to more favourable tax environments, again putting workers out of work (Mr. de Jong and others who do not believe this should study the history of BC during the Dave Barrett regime. He introduced a similar resource tax and our resource sector shut down not to return for over 10 years.)
He is long on how much money his plan would wring out of employers and tax-payers but has not addressed that with such an uncompetitive tax regime companies, capital and jobs will flee Canada leaving high unemployment and high taxes for those left working.
Back to school for you, Mr. de Jong, you get an F in Econ 101!
at 18:35 on March 20th, 2010
Eastvanray - If we were to run things according to Econ 101, every bad (destructive) resource would be sold fast and cheaply, every process would lack restrictive controls, every resource would be depleted to extinction. To govern is to act in the public interest - not the business or economic interest - unless it benefits the public and the public's resources. ""Elasticity of Demand" and be familiar with other concepts like the Mobility of Capital and the Substitution Effect"... we know the jargon. It's ok for many purposes - but not all - and it can be stupid to go down that road for the sake of a credit in Econ.
at 18:51 on March 20th, 2010
Free markets produce the highest prices for resources and private ownership (versus leases) ensures that the resource owner has a long term interest in the resource's productivity. Wanna see what's wrong with government running allocation of the harvesting of a resource just look at the east Coast cod stock or the West Coast salmon stocks. There's government wisdom for you. Governments put politics ahead of the total return to the resource owners (us).
You clearly do not hold this position so I welcome your supporting argument (examples) for the statements you made in the first half of your paragraph because I believe it to be completely false and not supported with facts.
at 21:08 on March 20th, 2010
Duh - your examples of fishing, like salmon farming - owned privately, bearing tons of lice that further ruin the wild salmon stocks. Everything is connected... except private ownership. Mines, forestry, oil and gas production - all privately owned and that poison rivers and lands willy nilly because those owners don't own the rivers and lands so they don't care what happens to them - unless regulated to do so. Free markets can indeed produce high prices - and huge costs that somebody else has to pay.
at 10:32 on March 22nd, 2010
You are wrong. In all cases NO private ownership exists. The resources are LEASED to the operator. The government OWNS the oceans, forests and land on which most mining takes place. The government leases or issues licenses to private operators who, since they do not own the resource, have no long term interest in the underlying health of the resource. Thanks for making my pint, though.
at 15:22 on March 23rd, 2010
Having read through your comments, eastvanray, I am left with the impression that you are not actually familiar with Classical Political Economic theorem, and its history.
It is worth study.
Frank de Jong's "Finance Resolution" dated March 9 on his Blog entry, here, is also worth reading in its entirety. It is a balm for the soul to know that a better taxation system, Resource Rent, would serve to "share the wealth" equitably.
at 17:53 on March 24th, 2010
My grasp of Classical Liberal Economic Theory (Smith, Von Miss, Friedman, etc.) is sound as is my grasp of Classical Liberalism (Ricardo, Jefferson, Hayek etc.). Please challenge any of my specific points if you feel I have made errors.