poverty despite of progress ??

["prakash chandrashekar" <prakash7uc@rediffmail.com>]

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Dear Param,

the big bug has a name - "private land value".

please read the book "progress and poverty" by henry george.

link - http://www.henrygeoge.org/chp1.htm

Let me give a proof

axiom 1 - you wouldn't work for another if you could earn the same
amount working for yourself, right ?

axiom 2 - to be your own boss, you need the earth - or a chunk of it
-land. be it a shop, garage, farm, EM spectrum, fishery, anything. and
you can earn only as much as is possible on that land, how much ever
that might be.

axiom 3 - you arrived late on this earth. The good land is already
"owned". so, you take on bad land (infact the worst land which is
touched by civilization) and earn a pittance - voila !! poverty !

conclusion - you worked hard, earned a pittance, no fault of yours
except that you arrived late for the party and the punch was over.

Does that make things clearer ?

Private land value or "owning the earth" may be a much bigger problem
than we think.

I'll explain again

consider a theoritical land which has lands of differing productivity,
from land which can produce 10 quintals of wheat for X effort (lets
consider X as the max effort a family can put in) upto land which
produces only 1 quintal.

people come to our theoritical land, take up the 10 quintal land and
grow crops. Now population increases and more people are competing for
the same land.  So, the next people take up the 9 quintal land. they get
only 9 quintals of wheat, and so on until,  people have colonised the 5
quintal land. Now a lazy fellow who owns a 10 quintal land doesn't want
to  put in X effort. He looks at those working on the 5 quintal land and
tells one of them - come to my land, work on it, you get 5 quintals
here. I'll give you 5.1 quintals for X effort on my land. the worker
agrees and does the same. The landlord gets 4.9 quintals for putting in
exactly ZERO efort and the worker is also "happy", because he gets more
than what nature would have given. Now imagine hte situation when the
population has touched the 1 quintal land. How much will the landlord
have to offer a worker -only 1.1 quintal. His land-liness can easily
pocket 8.9 quintals for putting in ZERO effort !

the money pocketed by the landlord is RENT. Rent capitalised over  time
is the price of land.

In the limit infact, the landlord has to offer only that much as natural
opportunity affords the worker. this is known as the MARGIN OF
PRODUCTION and is THE determinant of poverty in ANY PLACE, AT ANY TIME.
Everything above the margin of production goes into the pocket of the
landlord. There are reasons that we are not all poor. because all of us
have a component of the landlord in us. We own land and in india
especially, we Value land so much. Now i think that solves your dillema
of why the most rich country in the world continues to have poverty.

Now things would have been ok, if not for another tour-de-force of human
greed - LAND SPECULATION. seeing opportunity in the above game many
people decide just to buy land and hold it. we call it "investing in
real estate" in Politically correct terms. So, we hold land avaiting a
price rise. It happens with increase in population. The rent to
landlords increases because idle holding of land sends the margin of
production further down hurtling towards zero. wages keep reducing, rent
keeps on increasing and poverty continues despite of progress ! Even in
the richest country of the world !


woof ! that was long !

hope that interests you enough to read the book.

to quote ( mark twain or leo tolstoy - one of them had said. the quote
is true. I forget the auhtor - its one of them)
"people don't argue with george's ideas. they simply don't know them"

regards
prakash

------------- Original Message --------------
"Komaragiri, Param (Param)** CTR **" <param@lucent.com> wrote:
To:debate@indiapolicy.org
From:"Komaragiri, Param (Param)** CTR **" <param@lucent.com>
Date:Fri, 4 May 2001 10:50:20 -0700 (PDT)
Subject:FW: News from America's Second Harvest

Just go through this site.http://www.secondharvest.org

Parameswar





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