Could it be that the best way to achieve an economically liberal Britain might be to get a “mad” left government headed by Corbyn and McDonnell elected?

Now sure, ALTER has long touted the LVT-supporting credentials of leading Lib Dem MPs: Clegg, Huhne, Cable, Davey and others have been or are presidents or vice-presidents of ALTER, and both Farron and Lamb in the leadership campaign stated they supported the idea, but with how much conviction is anyone’s guess! Labour Land Campaign, ALTER’s equivalent LVT campaign group in the Labour movement, similarly tout the enthusiasm of McDonnell especially and Corbyn more recently as champions of this sine qua non of a liberal, just economic system.

Corbyn and McDonnell - the best way to achieve LVT?
Corbyn and McDonnell – the best way to achieve LVT?

McDonnell in particular, unencumbered in the past with the sort of high profile position Cable was in as Shadow Chancellor and then SoSBIS, has been particularly enthusiastic. He’s usually the MP who has facilitated LVT campaign meetings in Westminster through the Coalition for Economic Justice. We like to think of LVT as a Liberal cause, but even before 1909 it was a large part of the platform of the radical Labour movement (McDonnell is also the parliamentary leader of the “continuity LRC”) before they “split” from the Liberals electorally. It was the radical Labour movement who tended to use the cry “he who shall not work shall not eat” not aimed then at “benefit scroungers” but at idle landowners becoming rich off their tenants and the landless in general.

It was MacDonald and Snowden’s first Labour government who enacted an LVT where Lloyd-George had failed and it was the post-war Labour government that enacted LVT-lite as part of the Town and Country Planning Act regime. In both cases of course it was repealed by incoming Tory led governments before it could actually start.  In 1939 no less than the Prince of Darkness’s grandfather, Herbert Morrison, alongside Megan Lloyd-Goerge in the footsteps of her father, attempted to get the London Rating (Site Value) Bill through parliament. And it was Tony Benn who last resurrected the idea in the 1970s in parliament (in spite of his £8m Holland Park home).

Snowden in particular was a great fan of Henry George, penning the introduction to a 1930s edition of George’s paean to free trade, “Protection or Free Trade”. Their support for this, in the face of Tory protectionism at the time, got them kicked out of the Labour party if I recall correctly.

LVT is a bedrock of economic liberalism. The idea that “healthy” economic processes of labour and investment in productive capital should be rewarded and the primary means of the distribution of economic welfare, but that pure rent seeking be the source of contributions to whatever sort of state apparatus, and the provision of erroneously termed “public goods”. As Churchill noted in the debates around the People’s Budget, for the first time the taxman should ask not just “how much have you got” but “how did you get it”.

Once you have a comprehensive system for collecting that socially created value (an economic externality if ever there was one) the need for many of the left’s more statist welfare and economic interventionism disappears as true “predistribution” takes effect. A term shamelessly abused by Ed Miliband and his American political scientist inspirations Jacob Hacker and Paul Pierson (in “Winner Take All Politics” in which they claimed to have coined the word – they hadn’t – LVT and monetary reformists had been using it for years before them).

And on the other side, once you implement such a system you encourage business, detax the profits of true capital investment, and create an economy that would be perhaps 30% more competitive, why should the “right” object once they see that working. Only the tiniest minority, overall, and all of them rent-seekers, would be permanently disadvantaged, to the extent that they might actually turn their no doubt excellent entrepreneurial skills to proper capital instead of land.

The Economist for a long time (perhaps since supporting J S Mill for all I know) and the FT more recently (through Samuel Brittain and now Martin Wolf) are fans, as are the centre left darlings at Prospect. Whilst many of the historical and contemporary economic and political figures that are wheeled out in support are seen as on the “right” mainly because that’s where the most objections come from, lefties like Stiglitz are fully on board with rent being the mainstay of a healthy fiscal system.

If some of their more nutty state interventionist socialist policies can be countered, or at least made secondary to LVT or whatever we want to call it, perhaps, the best way to get this essential underpinning of a liberal economy implemented would, indeed, be to elect Corbyn and McDonnell to PM and Chancellor as soon as possible 🙂

Vote Labour for a liberal, just economy?
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