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Earth Rights Democracy

Land Ethics and Public Finance Policy as if People and Planet Mattered

by Alanna Hartzok, Co-Director, Earth Rights Institute
Presented at the
The Richard Alsina Fulton Conference on Sustainability and the Environment
March 26 - 27, 2004
Wilson College, Chambersburg, PA

Evaggelos Vallianatos, in his reflections on Why Small Farmers are Essential to Democracy, said: "When democracy thrived in Greece, so did farming. The two were inseparable." He noted that those who worked very small plots of land, not philosophers, laid the foundations for ancient Greek democracy. "Democracy was the Greek smallholders' answer to tyranny" and the "genius of Greek civilization." Vallianotos well remembers the joys and pleasures of childhood on the small Greek farm where he grew up. "My father's farming was wrecked when the Americans converted Greece to agribusiness," he states.1

Somehow our world has become complex. Stress related emotional and physical illness continues to rise. Most of us are born landless, without any real place to be. Our parents were probably paying rent or a mortgage while we were growing up. They did the best they could, then we launched into the world of labor. While some never made it to the first rung of the ladder, others found employment as highly skilled laborers. An educator is a type of highly skilled laborer. Usually, the more highly skilled a laborer is, the further removed he or or she is from the land. Yet that which all of the laborers need to survive comes ultimately from the the earth itself.

Who owns the earth?

  • A United Nations study of 83 countries showed that less than 5% of rural landowners control three-quarters of the land.
  • Just 342 farm properties in Brazil cover 183,397 square miles - an area larger than California 2
  • 86% of South Africa is still owned by the white minority population
  • 60% of El Salvador is owned by the richest 2% of the population
  • 80% of Pakistan is owned by the richest 3% of the population
  • 74% of Great Britain is owned by the richest 2% of the population
  • 84% of Scotland is owned by the richest 7% of the population
  • At best, a generous interpretation would suggest that about 3% of the population owns 95% of the privately held land in the United States.3
  • 568 companies control 22% of our private land, a land mass the size of Spain. Those same companies land interests worldwide comprise a total area larger than that of Europe - almost 2 billion acres.
  • In Florida, 1% owns 77% of the land. Other states where the top 1% own over two-thirds of the land are Maine, Arizona, California, Nevada, New Mexico, and Oregon.4
  • Urban Land Institute calculations show that more than half of all corporate earnings are generated by real estate and real estate-related activities.5

Eli Siegel once said, "How the earth should be owned is the major economic question of this time; as it is the oldest.... The world should be owned by the people living in it."6

By some estimates, one percent of the population owns at least 60% of the land value in western countries. The value of all land in the United States in 1990 was $3.7 trillion.7 By now that number is likely to be more than $6 trillion. The federal government no longer tracks land ownership and values. Apparently such numbers are too politically sensitive.

Let us take an example of how the average American family experiences the land problem. In smaller cities a typical $120,000 house will be on a $30,000 lot. In major population centers a house costs double, triple or even 10-times that price. In parts of California a comparable home would be $400,000; in parts of Washington, DC it would be $800,000. Labor and material prices for these homes are relatively equal. The price difference is the cost of land functioning under the "law of rent" as described by classical economist David Ricardo.8 Under our current economic system, the price of land is paid by the producers of wealth - labor - to those who amass wealth from unearned income for which they do not labor. Those who receive this unearned income from land price escalation are primarily (1) those who already own large amounts of land or land of high value; (2) those who are earning interest from real estate speculation; and (3) financial institutions via mortgage payments.

We must grasp the injustice at the core of our economic system. We need to understand how far we have strayed from reality and how we have been led into illusionary games of finance. Patricia Mische said, "The more we grow in awareness of our own sacred source, the more we discover that our own sacred source is the sacred source of each person and all that is in the universe."9

Near a large metro area, a farmer can sell land at a price of $20,000 to $60,000/acre and in some cases even more. The farmer takes this cash and looks for another farm to buy farther from the city. Using a 1031 (tax-free) exchange he rolls the profits into another farm. Another group of agricultural land buyers are investors who conclude that ag land is a good investment after watching farmland prices go up. Farmers sitting on significant equity in land they already own also add to their current land base at higher prices when they perceive that land values are on the rise.10 Farmland thus loses its utility value for agriculture and becomes a "good investment" - a cash cow to be milked for all its worth.

For most farmers, the value of farmland comprises the majority of net worth. The recent land price boom has been driven primarily by low interest rates. Because of these low interest rates, a young couple living in a metropolitan area can now buy a $150,000-200,000 home. As a result of these new buyers, real estate developers are able to buy farmland at extremely high prices and develop entry-level to middle-income homes.

John Mohawk fully grasped the problem of our land tenure system. He said, "When land became a 'commodity' and lost its status as provider and sustainer of life, Western civilization began its history of subjugation and exploitation of the earth and earth based cultures.11

Today, this subjugation and exploitation is eroding middle class America as well. While the larger land parcels are bought with cash or very little debt, working people take on substantial amounts of debt to buy their small house plots. This further widens the wealth gap.

Americans are working longer and harder just to buy someplace, somewhere, to rest their weary bones at night. The United States is a super rich nation which spends a huge amount on health care and has multitudes of sick people. The Health Olympics tracks the correlation between illness, longevity and economic injustice as indicated by the wealth gap. This indicator shows that the greatest health hazard in the United States is the economic gap between the rich and the poor. With greater economic inequality comes worse health - lower life expectancy and higher mortality rates. The U.S. spends the most money on health care but ranks 26th in life expectancy on the Health Olympics 2003 chart. All of the countries that rank higher in the Health Olympics have a smaller gap in income distribution between their richest and poorest citizens.

Worldwide less than 300 multi-billionaires now have as much wealth as three billion people, which is half the six billion population of the planet. Just three people have as much wealth as the people of 48 countries. In the United States, the wealth gap has been steadily growing since the 1970s. Currently, the top one percent of our population has accumulated more household wealth than the bottom 95 percent. The bottom 90% has only 29% of household wealth. The wealthiest 1% owns 49% of all stocks and mutual funds; the next 9% own 36% and the bottom 90% own 15%.12

Robert Reich said, "We now have more national income and national wealth concentrated in fewer hands then we've had since the gilded age of the late nineteenth century. This poses a fundamental threat to democracy."

One of the most disturbing aspects of life in this very wealthy country is the persistence of hunger. The U.S. Department of Agriculture (USDA) reports, based on a national U.S. Census Bureau survey of households representative of the U.S. population, that in 2002 11.1 percent of all U.S. households were "food insecure" because of lack of resources. Of the 12.1 million households that were food insecure, 3.8 million suffered from food insecurity that was so severe that USDA's measure classified them as "hungry." The report showed that food insecurity and hunger increased in the United States for the third consecutive year. Since 1999, food insecurity has increased by 3.9 million individuals: 2.8 million adults and more than one million children. In 2002, 34.9 million people lived in households which were unable to purchase adequate food and thus experienced food insecurity, compared to 33.6 million in 2001 and 31 million in 1999.13

The U.S. Conference of Mayors in their Sodexho Survey 2003 also reported that hunger and homelessness continued to rise in major American cities over the last year.14 Twenty participating cities reported that unemployment and various employment-related problems were the leading causes of hunger. Other causes most likely contributing to hunger include low-paying jobs (13 cities) and high housing costs (11 cities). Participating cities were most likely to attribute homelessness to a lack of affordable housing (21 cities), mental illness and the lack of needed services (20 cities), substance abuse and the lack of needed services (19 cities), and low-paying jobs (17 cities). The survey documents significant unmet need for shelter in the cities surveyed. Eighty-four percent of the cities reported that emergency shelters have turned away homeless families due to lack of resources.

To remedy this injustice we must understand the land problem. Thomas Berry said, "Humans in their totality are born of the earth. We are earthlings. The earth is our origin, our nourishment, our support, our guide... Thus the whole burden of modern earth studies is to narrate the story of the birth of humans from our Mother Earth."15

The millions who are hungry and homeless in America are unlikely to ev