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RE: [LandCafe] Re: Rack-rent and Digest 1804.

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  • Harry Pollard
    Thank you Walter for telling David what I mean by rack-rent even though both your suggestions as to how I use the term rack-rent were wrong. I have several
    Message 1 of 101 , Nov 1, 2010
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      Thank you Walter for telling David what I mean by rack-rent even though both your suggestions as to how I use the term rack-rent were wrong.

       

      I have several times defined my use of the term rack-rent as:

       

      “The highest amount that can be extracted from a tenant while maintaining production.”

       

      Henry George said any higher would mean a “cessation of life”.

       

      Anyway, the rest of your paragraph is meaningless.

       

      In David’s example, he, and apparently you in response, are both not discussing land rents, but apartment rents.

       

      Georgist theory suggests that “rents” become so high that the wages of the General Level workers – those at the bottom with interchangeable jobs – are at subsistence levels. Any higher rent would mean that workers would begin to die. They would no longer be able to “maintain production”.

       

      You are right. With a full collection of Rent for the community, rack-renting would disappear, which is something much to be desired. If you don’t like my use of the term rack-rent, we can always call it Rumpelstiltskin. However, I think I’ll continue to use rack-rent to distinguish it from Rent - a value that reflects the advantage given to a location by the surrounding community.

       

      A problem with seeing rack-rent is that its effects are hidden by the enormous welfare apparatus that looms in all the rich countries. When I see in the UK Parliament that discussion is directed to the extra pittance that is going to Old Age Pensioners to help keep them warm during the winter, I can hardly hold back the cynical laughter. Doesn’t anyone wonder why a person might work for 40-50 years and be unable to save enough for a comfortable retirement?

       

      However this is not a “terribly important matter” as you put it, so by all means don’t pursue it.

       

      But, I will.

       

      Harry

       

      ********************************

      Henry George School of Los Angeles

      Box 655

      Tujunga  CA  9104

      818 352-4141

      ********************************

       

      From: LandCafe@yahoogroups.com [mailto:LandCafe@yahoogroups.com] On Behalf Of walto
      Sent: Sunday, October 31, 2010 5:56 AM
      To: LandCafe@yahoogroups.com
      Subject: [LandCafe] Re: Rack-rent and Digest 1804.

       

       



      --- In LandCafe@yahoogroups.com, David Reed <dbcreed@...> wrote:
      >
      >
      > Walto wrote on 29thOct :"all rent is rack-rent,unless one landlord happens to be in a charitable mood. Why should anyone take less?"
      >
      To which Dave responded: > Having once superintended ,for somebody else ,the letting of some commercial property (don't laugh), it became apparent that you could ,when there was a lot of money around let shops at an eye-watering rent such that it was difficult to see how a ,generally over-optimistic, tenant would make any money. Whereupon, come the downturn, s/he duly did n't and stopped paying the rent ,very often claiming that the landlord had n't kept up with repairs (He had n't, having ambitions to be a rack-renter).This exerience seems to show that it is not good practice to press the tenants to the limit
      > and that it is not just being charitable to allow a realistic rent but a way to keep the tenant in continuous occupation.
      >

      This, I think, shows quite well that the term "rack-rent" already has a meaning and can't be confiscated and given a strictly geoist use without creating equivocations. That is, you seem to be using it to express something like "rent too high for the existing tenant to afford and higher than any decent/reasonable landlord would charge upon seeing the pain created by its levy."

      The problem is that such rents could occur in a completely geoist realm--even WITH a personal exemption. If Harry were made king and instituted a full LVT, there would still be rack-rents as you use this term above, though there couldn't be as he uses it.

      What Harry does is, as I explained in my last post, misleadingly make it into a technical term, meaning sometimes "the excess rent created by speculative withholding or less than highest use" and sometimes "the total rent including all such excess." This makes a mess of the traditional use because the pain in some location produced by rents being "too high" to be paid by people who already live there, want to continue, but can't at that charge would not be completely eliminated unless there were landlords so rich and charitable that they offer these places at a loss--an amount at which they subsidize their tenants when they pay the LVT. Thus Reedian/traditional "rack-rent" would not be eliminated by a full LVT, while Pollardian "rack-rent" would be, by definition, gone. That's why his use of it is misleading and results in equivocal usages.

      This is, however, not a terribly important matter, and (a) I'm sick of it, and (b) Harry doesn't actually read anyone's objections, but, like a robot, just repeats his piece again. Thus, I'm not going to discuss it further. I just warn that contentions that "rack-rent" would be eliminated by the implementation of a full LVT are both true and false, depending on which definition one is using at the time.

      Best,

      W

    • John
      ... Few parts of London have close communities. The old London arrangement of terraced houses ... If giving the land of England back to the people of
      Message 101 of 101 , Dec 27, 2010
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        --- In LandCafe@yahoogroups.com, "roy_langston1" <roy_langston1@...> wrote:
        >
        > --- In LandCafe@yahoogroups.com, David Reed
        > dbcreed@ wrote:
        >
        > > It will come as a surprise to Londoners to hear
        > > that Bloomsbury and Marylebone are not
        > > communities or COMMUNITIES even.
        >
        > No, it won't, as Londoners are aware that they are
        > merely neighborhoods or districts.

        Few parts of London have close communities. 
         
        > > The old London arrangement of terraced houses
        > > surrounding a communal but private garden
        > > behind cast-iron railings(annual key money 50
        > > quid) does create a sense of community
        >
        > Speaking of senses, that smells of equivocation
        > -- and conflates "community" with "exclusivity."

        "If giving the land of England back to
        the people of England is theft, I am
        quite happy to call it theft. In his zeal to
        defend private property, my
        correspondent does not stop to consider
        how the so-called owners of the land
        got hold of it. They simply seized it by
        force, afterwards hiring lawyers to
        provide them with title-deeds. 

        In the  case of the enclosure of the common
        lands, which was going on from about
        1600 to 1850, the landgrabbers did not
        even have the excuse of being foreign
        conquerors; they were quite frankly
        taking the heritage of their own countrymen,
        upon no sort of pretext except that they
        had the power to do so. Except for the
        few surviving commons, the high roads,
        the lands of the National Trust, a certain
        number of parks, and the sea shore below
        high-tide mark, every square inch of England
        is 'owned' by a few thousand families. These
        people are just about as useful as so many
        tapeworms. 

        It is desirable that people should
        own their own dwelling houses, and it is
        probably desirable that a farmer should own
        as much land as he can actually farm. But
        the ground-landlord in a town area has no function
        and no excuse for existence. He is merely
        a person who has found out a way of
        milking the public while giving nothing in
        return. He causes rents to be higher, he
        makes town planning more difficult, and he excludes
        children from green spaces: that is literally all
        that he does, except to draw his income.

        The removal of the railings in the squares
        was a first step against him. It was a very
        small step, and yet an appreciable one, as
        the present move to restore the railings shows.
        For three years or so the squares lay open, and
        their sacred turf was trodden by the feet of
        working-class children, a sight to make
        dividend-drawers gnash their false teeth.
        If that is theft, all I can say is, so much the
        better for theft."

        - George Orwell

        Orwell was writing in WW2.  The squares were open after the railings were taken down to make war products.  To his disgust, he notes they started to enclose the green grass in the squares again, using wooden fences, excluding poor children from the scarse open urban space.

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