Understanding How to Save the World

 

Notes, lessons, and discoveries on creating prosperity for all and a thriving ecological planet

My journey as an ecologist began with a foundational study in biochemistry, which soon led me into the captivating world of ecology and population modelling. My passion quickly gravitated towards niche conservation and the critical work of saving rare species. Over the years, I’ve had the privilege of working with various charities, eventually reaching senior roles. It was this extensive experience that inspired me to establish my own charity, dedicated specifically to the principles of rewilding.

I’m probably best known for orchestrating the first beaver reintroduction in the UK with the fantastic John McAllistair, who conceived the project, a project that filled me with immense pride. Beyond beavers, my work has involved bringing back numerous other animals, such as dormice, red squirrels, and pine martens, and tirelessly working on habitat restoration. This often involved fundraising for the purchase and rejuvenation of rare habitats, contributing to rewilding initiatives both within the UK and on a global scale. More recently, I’ve transitioned into consulting for large-scale international rewilding projects, which has broadened my perspective significantly.

However, throughout my entire career, I’ve maintained a keen interest in land economics. I’ve always pondered the fundamental reasons behind our land-use choices and the underlying forces that dictate efficient and inefficient land utilisation. This deep-seated curiosity led me to become actively involved in understanding economic principles, particularly championing the campaign to promote land value taxes.

I am indeed very familiar with Henry George’s seminal work, “Progress and Poverty,” a book that resonates deeply with many progressives advocating for land value taxes. When we discuss a land value tax, it extends beyond a mere textbook definition of a tax on land. We delve into both theory and practice. The standard definition refers to an ad valorem tax on the rental value, or rather, the unimproved rental value of land. In simpler terms, it’s an annual tax, much like paying rent, for the land itself, as if there were no buildings or improvements upon it. It essentially captures the ‘location value’ or, more aptly, its ‘monopoly value’. I prefer the term ‘monopoly value’ as it leads into a broader understanding.

Land value taxes are, at their core, monopoly taxes. Wherever monopolies exist, we have two primary approaches: either imposing rules and regulations, or taxing them. Henry George, and indeed many other economists throughout history – for he wasn’t the first to observe this – recognised that taxing monopolies doesn’t distort markets or lead to job losses. Monopolies are pervasive; they aren’t confined to the unimproved location value of land. We see them in intellectual property rights, government-granted monopolies (where exclusivity is conferred by law), and even platform monopolies like Amazon, where a dominant player emerges due to consumer preference for a single, convenient service. There are also natural monopolies, such as healthcare in a specific area (it’s inefficient to have multiple MRI machines competing) or utilities like water and electricity, where attempts to create market competition have largely failed.

So, the identification and subsequent taxation or control of monopolies are central to this discussion. But the scope widens further to encompass externalities – the harm we inflict. If a river is polluted, for instance, there should certainly be laws to prevent such pollution. However, critically, there should also be a mechanism to pay for the damage caused. When we pollute or harm others through our activities, we should either be prevented from doing so or be required to pay a fee proportional to that harm. This inherently discourages harmful practices and encourages beneficial ones.

This series of definitions of a land value tax is multifaceted. Firstly, there’s the classical textbook definition, a concept extensively explored by classical economists. Secondly, we have the expanded definition of monopoly, which includes monopolies in banking and finance, particularly the monopoly of creating money that banks enjoy – a government-granted privilege that shouldn’t be free. While outright taxation might not always be the preferred route here, the principle of not allowing free money creation remains. Thirdly, and perhaps most broadly, we address the externalities of life – the harm we inflict on the planet, our children, and our future. As Henry George and others have demonstrated, by taxing these negative elements, we can build a better, more efficient, and more equitable humanity.

Thank you for appreciating the broad explanation of land value taxes. Now, let’s talk about marginal land.

Marginal land is a conceptual idea, deeply rooted in David Ricardo’s seminal work and his law of rent. It essentially addresses the point at which land is no longer economically viable to use. “Margin” here refers to the boundary between use and non-use. In most agricultural contexts, it’s the point where a farmer decides whether it’s worth the effort to cultivate a particular piece of land. Similarly, a hunting estate might assess if it’s profitable to allow hunting in a certain area. Different land uses, therefore, have their own specific margins. There isn’t a single, fixed margin, but rather thousands, depending on the intended use. We consider margins for motorway construction, school placement, farming, hunting estates, or even establishing a nature reserve. Each of these represents a point where we evaluate the reward versus the effort, determining whether private investment or government intervention is warranted. So, while we often think of marginal land in terms of farming, it truly applies to all land uses, representing that critical threshold of viability.

Regarding the relationship between government subsidies and marginal land, any form of subsidy effectively shifts this margin. Many factors influence these margins, such as tax burdens and inheritance rules. If, for example, farmers receive a subsidy, it encourages them to expand their farming activities into more land. However, this often leads to a paradoxical outcome: while more land is farmed, there’s less incentive to invest in efficient machinery or labour for that land, ultimately leading to less efficient land use overall.

From an economist’s perspective, any subsidy will increase the consumption or use of the subsidised item. If you subsidise butter, people will buy more butter. The same principle applies to land. However, as an economist, you must also consider all the other inputs: pesticides, labour, capital investment, and so on, which all factor into land use decisions.

As a conservationist, this is where the real “cracker” lies. We have environmental subsidies, such as agri-environment schemes, where farmers are paid to farm less intensively. On the surface, this sounds wonderful for nature conservation – more bees, more butterflies. However, once you understand land economics, you realise the inherent flaws. These schemes, while seemingly beneficial, ultimately lead to more land being brought into farming elsewhere, which causes far more environmental destruction than the modest gains from less intensive farming. We might as well just leave that land alone.

Nature conservation organisations often favour these subsidies because they secure jobs and maintain operations. Yet, in reality, all subsidies, including agri-environment schemes (though they cause less damage than, say, direct headage payments being reintroduced in the UK, which is absolute madness), ultimately harm nature. Price support subsidies, where the sale of goods is supported, or tariffs on imported goods, all effectively subsidise land. By definition, this means more nature will be destroyed. It’s truly an unfortunate situation, and I sincerely hope governments will act more environmentally favourably in the future.

When considering how a land value tax can benefit ecosystem services and biodiversity globally, particularly in diverse political and geographical contexts, it’s essential to understand that fundamental economic forces operate universally, whether in Papua New Guinea or Los Angeles. What differs are the specific rules and regulations. We can observe across the world that where there’s public collection of monopoly economic rent or state ownership of land, both nature and human well-being tend to improve.

Let’s look at some examples. Botswana, fortunately, never adopted the English common law on land ownership. They’ve maintained a system of leasing land and tribal rights, with different land types subject to varying leasing requirements or owned in common by tribal elders. This communal ownership model, akin to the old “Commons” in Europe, generally results in more abundant wildlife and significantly better living standards for people, including improved education, welfare, and health.

If you examine metrics across countries, those that effectively capture land value – places like Singapore, Japan, and Hong Kong – tend to have happier, healthier populations and more thriving natural environments. It might sound mad, but it works. Hong Kong, despite its dense urbanisation, boasts remarkable natural areas, and while living conditions can be challenging, they would be far worse without their land value capture system. Botswana, for instance, exhibits continent-leading levels of education, life expectancy, and infant mortality, largely attributable to its land-use regulations.

Having worked in Namibia, I can attest to the stark differences. Where there’s some form of state control over land, the benefits are evident. The moment land wealth is privatised, and individuals capture all economic rent, it creates a perverse incentive to exploit land and natural resources, be it water or minerals. This exploitation leads to greater externalities and, crucially, increased poverty. When landowners effectively charge people to occupy land, poverty escalates dramatically, jobs become scarce, and taxing people’s labour further exacerbates their financial struggles.

The administration of such a tax depends on the specific land or natural resources you wish to manage, aiming to limit use and generate government revenue. Historically, in the British system and other nations, fees were charged for the use of certain natural resources, such as firewood. This wasn’t about denying access but about ensuring sustainable use. One could argue for a basic quantity for essential needs, but for economic exploitation, a fee should be levied. This system is perfectly suited for all forms of natural resource extraction, be it coal, copper, or cobalt.

We can also combine this fee-based system with an externality component. Consider fishing rights. Around the Falkland Islands, for example, scientists assess squid populations and then charge a fee, limiting the number of licenses. This allows for adjusting fishing quotas and fees based on the health of the fish stock. Such systems, especially when they include a financial component, are far more effective than mere permit systems, as they encourage self-policing among those who pay the tax and actively protect fish stocks.

Pollution is another critical area. In Britain, as in many parts of the world, agricultural effluent and sewage severely pollute rivers. Charging a fee for this pollution would incentivise water companies and farms to treat their waste more effectively, thereby reducing their tax burden and yielding positive environmental outcomes. Similarly, managing navigation on congested rivers through charges for access, or auctioning airport landing slots (which are government-granted monopolies), are all ways to capture monopoly value and promote efficient resource use.

A former British diplomatic representative to the UN once shared his vision for funding UN projects – human rights, child protection, food security – through international copyright levies, fishing, and the exploitation of natural resources in non-national waters. This, he argued, would be a fantastic, job-creating way to fund the UN, free from the control of nation-states.

Ultimately, the analysis always comes down to identifying the monopolistic aspects of resource use and the externalistic problems that can be mitigated through taxation.

To clarify the term “monopolistic,” I refer to any form of monopoly that can be mathematically analysed as a system where value is derived from a limited ability to use a product, where true competition is absent. It’s about recognising that these aren’t free market systems. My central aim is to mathematically extract as much monopoly value as possible from private hands and return it to either public ownership for the common good or distribute it equally among all human beings. Additionally, we must address externalities and damage in the most efficient, straightforward, and fraud-resistant way possible. This understanding – of monopolies, externalities, and how to manage them efficiently – I believe, holds the key to solving the world’s problems. It has the potential to transform humanity into a happier, more prosperous society and safeguard the planet for future generations.

Regarding land valuation methods, while I’m not a valuation expert myself, I know many land surveyors and tax specialists who confirm the existence of numerous robust models. Commercial models are already used by insurance companies, for instance, to separate the value of rebuilding a home from the underlying land value when assessing claims. These are highly efficient.

The reality is that whether you accurately capture 90%, 100%, or 110% of the land value isn’t as critical as ensuring the majority of it is taxed. The system needs to be simple, equitable, transparent, and, crucially, resistant to abuse. Anyone familiar with the land market knows there are countless individuals constantly devising schemes to reduce property taxes or business rates (which, incidentally, are not land value taxes as they’re based on the entire property, not just the unimproved land). There’s always an incentive to manipulate the system. We’ve seen this happen historically in places like Taiwan and Japan, where land value taxation systems were gradually undermined.

Therefore, we need a simple, un-subvertible system. With modern Geographic Information Systems (GIS), all land can be precisely mapped and valued. A key theoretical concept is to tax land at its highest permitted theoretical use – the use for which the government has granted permission, be it an office block, a factory, or a house. This incentivises the most efficient land use possible.

The models exist. Organisations like ALTER (the Liberal Democrats’ land value tax system) have developed wonderful computer models. One of my heroes, Hector Wilkes, a former trustee of Kent Wildlife Trust, even wrote a scientific paper demonstrating how simply a land value tax could be implemented in a Kent town and adjusted for inflation. There’s a wealth of academic research and a strong professional community dedicated to this. It’s not for you or me to delve into the minutiae, but for these professionals to implement.

Finally, to address how land value taxes stimulate job creation, it’s quite profound, even if you were to, as Henry George famously quipped, collect all the land value taxes and dump the money in the sea. The sheer presence of such a tax would benefit society. This is because it suppresses the price of housing, land, and other monopolies, making these essential resources more accessible to people.

Drawing on David Ricardo’s law of rent, by suppressing these prices, you naturally draw people away from working in peripheral, marginal areas and encourage them to utilise the most productive land available. This eliminates the waste associated with using unproductive land, thereby saving more nature.

However, we wouldn’t actually dump the money in the sea. This revenue would be used to fund vital public services: schools, hospitals, policing, security, and social welfare. Crucially, it means we wouldn’t need to tax people’s labour. This brings us to three significant benefits:

1. Funding Public Services: The revenue directly pays for essential government services.

2. No Taxation on Labour or Trade: Taxes on labour and trade are “deadweight costs” – they discourage employment and stifle economic activity, leading to unemployment and poverty. Removing these taxes would lead to many more productive jobs and increased, more efficient trade.

3. Efficient Public Services: With ample funding, public services become more efficient, leading to healthier, happier citizens. Improved public transport and more affordable housing reduce costs, allowing businesses to export goods and services at a more competitive price on the global market.

These benefits combine to create a “super economy.” Countries that have embraced taxing land values in some form, historically like Japan and Hong Kong, and currently Singapore, are among the most competitive nations globally.

Consider the stark contrast of San Francisco today. It was once one of the most productive places in the world, a hub for groundbreaking industries and brilliant minds. However, uncontrolled land values have driven house prices to such astronomical levels that people can no longer afford to live there. This has literally begun to destroy the city. They are suffering horrendous consequences precisely because they are not capturing land values and have allowed monopoly privilege to run rampant.

This brings us full circle to Henry George’s initial observations. He arrived in San Francisco to begin a new job as a printer and described in his great book how the city initially offered wealth and jobs for all when land values were low. As private land ownership expanded and the city became more productive, it paradoxically led to increased poverty due to the growing disparity between those who owned land and those who did not. We are now witnessing the “farcical conclusion” of his observations in San Francisco.

It’s farcical because you have perhaps the most productive place on earth for new industries, a mere cappuccino’s throw from Silicon Valley, yet all that productivity is being captured by inflated land values. The great investor Peter Thiel, an early investor in many new industries, observed that his investments were primarily going towards paying rent for office space and employee homes, leaving little for productive investment. This is a classic economic trap: the entire system has become so distorted that the very wealth it generates is siphoned off by land speculation, stifling further innovation and prosperity.