How Land is the Lynchpin in the Global Banking Systems | Interview: Mike Bird

The shift from agricultural to industrial economies dramatically changed land value from being based on what you could grow or mine from it to being based around cities, which created a much more fixed supply because cities can only grow so large based on transportation technology available at the time.

“the huge change obviously in the Enlightenment area era and and going forward was the move to industrialization and urbanization changing the value of land from primarily agricultural based on what you could grow from it or mine from it or anything like that to being based around cities um, which created a much more sort of fixed supply of land because cities can only grow so large based on the sort of transportation technology available to you at the time. You could only live so far away from the place that you work.”

English colonial North America went from a land-scarce (Europe) to a land-rich society, making land seem plentiful and creating an enormous drive to exploit its value, turn it into money, and encourage economic activity—a major fracture point with the British Empire and early US independence.

“colonization of North America, the English and then British colonization of North America where you went from a place where the supply of land was fixed and everyone owned everything in in England in the United Kingdom to a place where the land supply suddenly seemed not to be fixed. Um, the early colonists absolutely enormously wealthy in land, right? Um, they didn't know how far the world they were expanding into would go but the land seemed like the most plentiful thing that they had. Um, and and the use of it in finance really I think stems from that.”

Despite being promoted by the World Bank and other multilateral development institutions, property formalization and land titling programs did not have the revolutionary impact that Hernando de Soto hoped for, suggesting that while property rights are necessary, dropping them into a system without other enabling conditions does not automatically produce capitalist development.

“What we have seen is this been promoted and it's still promoted by by the World Bank and a lot of other institutions. It didn't have the revolutionary impact that I think Hernando de Soto would have wanted. I think almost everyone agrees that to have a rich country uh with a sort of market oriented model you need property rights and you need the ability to borrow against it. The problem is it's a bit of a chicken and [51:37] egg thing. Where do those rights emerge from? What sort of system creates those rights in and of itself? Can you just drop the property rights on another system and say you're off the races now, you can borrow from the bank against the land, go for it. It seems not.”

Late 20th-century reality contradicted Arthur C. Clarke's prediction—rather than decentralizing, knowledge workers doubled down on a few really expensive superstar cities (San Francisco, London, New York, Asian cities), with land prices in these cities exploding as high-income workers clustered together to access cultural capital and exposure to similar professionals.

“to put it lightly this did not turn out to be correct about the development of communication technology. And in fact what you saw in the late 20th century was uh doubling down on a few really really pricey cities. You see the superstar city effect, knowledge workers really want to be in and among one another. They want uh whether it's access to the sort of cultural capital that gives you or direct exposure to other people like yourselves. You see this doubling down of really really high income people moving to the same places, land prices [56:49] absolutely exploding in these places”

Land's fixed supply in most places means that once concentrated ownership is established, changing the system becomes extremely difficult politically because land is a widely-owned and politically salient asset, making systemic reform nearly impossible regardless of whether the system is good or bad.

“the difficulty of getting out of it when it's a very widely owned Right. politically salient asset. Whether that's, you know, you have a good system or a bad system or whatever, it's it's it's extremely difficult to change.”

When people with abundant social capital and willingness to tolerate annoying neighbors at dinner can maintain shared institutional arrangements (kibbutzes, communes), but when social solidarity erodes, even well-designed systems break down as people prioritize individual interests.

“you can be a Skinnerist or you can be a Shaker, you can be all sorts of things, you know, and you know, the kibbutzes worked when there was just massive amounts of social solidarity and you're willing to tolerate annoying neighbors at your dinner table every night, but eventually that stuff, you know, just starts to erode.”

Milton Friedman's favorite quote about free trade—'protectionism does to us in times of peace what our enemies do to us in times of war'—is originally a Henry George quote.

“Milton Friedman's favorite quote about free trade, you know, protectionism does to us in times of peace what our enemies do to us in times of war. It's a Henry George quote.”

The real value of land is the intangible capital of the people associated with it and the resources that can be allocated to it—owning land near economic activity is like owning a small stake in that economic activity.

“I always think of it as owning land near some economic activity is like owning a small stake in the economic activity. Right. You can you can benefit from that whether that's you know, you're using a piece of land for anything from a a railway depot to a a luxury apartment. If there's some form of activity you can you can benefit from that. If there's no activity you can't.”

Henry George's central argument was that everyone in the industrializing world could see technological progress (trains, electricity, telephone, medical technology) alongside crushing urban poverty, and George's explanation was that land concentration allowed landowners to mop up all the gains of these technologies and all economic surplus.

“Henry George's idea is essentially within the title of the book, which is that everyone in the United States and everywhere in the in the industrializing world at the time could see they live in an era of technological change unlike anything the world has ever seen. We're talking about trains, electricity, telephone, lighting, the development of medical technology, all sorts of other things. This is a sort of era of mass industrialization beginning. Um and at the same time, you have these sort of crushing forms of urban poverty that particularly in the United States uh jarring relative to what was once a very sort of egalitarian, politically equal, and and relatively low economic inequality society. People are screaming out for an answer to these two things happening at the same time. Henry George comes along and says, "It's land. It's all land." Land is concentrated and the people that own it are able to mop up the gains of all of these amazing technologies. Um and they're able to mop up essentially all of the sort of economic surplus in society.”

Hardcore Georgists tried to set up utopian communes like Arden in Delaware and Fairhope in Alabama based on Georgist principles, which had vague success for a few years before becoming normal towns as the system leaked away over time.

“A lot of really hardcore Georgists tried to set up their own sort of utopian communes. You have places um Arden in Delaware and uh Fairhope in Alabama, um which are attempts to set up along Georgist lines. A society, um which have sort of some vague success for a few years. They're just normal towns now, you know, the stuff sort of leaks away over time.”

In China, the central government changed the tax and spending system in 1994, shifting revenue collection to central government while keeping spending obligations local, leaving local governments with only 60-70% of their funding needs and forcing them to turn to land sales to fill the gap.

“the central Chinese government in 1994 changes the tax and spending system in China and instead of the local and provincial governments doing almost all of the tax raising and almost all the spending, the central government says, "No, okay, this is over. You're going to do all of the taxing, but the tax money comes to us. We will decide how much you get back, right?" So, overnight local governments in China go from sort of roughly fully funded to only able to afford 60 or 70% of their spending obligations. And they turn eventually to land sales as the way to fill the gap.”

George's explanation was particularly appealing in the US because the frontier was closing—people could no longer head west and carve out homesteads as their ancestors had done 50-100 years earlier.

“I think this is particularly appealing at the time in the US because the frontier is basically closing. So, you're going from a period where 100 years earlier, people's ancestors might have arrived in the United States even 50 years earlier and been able to head out west and carve something out for themselves. That's done really by the time Henry George is emerging as a major figure.”

George wrote like a lay preacher using biblical language to describe economic injustices, which made his ideas dramatically more engaging to ordinary American, British, and European readers than academic economic writing.

“He writes like a sort of lay preacher. It's very religious, you know, barely an undertone. He's very religious man and he's happy to use sort of biblical language in describing the injustices that he sees. And this becomes a gargantuan social movement on both sides of the Atlantic.”

Marx criticized George in his letters as a 'secret capitalist plot' because George wanted to separate land from capital, arguing this would end with no taxes on other capital, leading to total capitalist control.

“This this American land taxer who I think I think Marx actually nails him to some degree in that he says he's a, you know, this is a secret capitalist plot, right? Because he's trying to separate land out from capital. He's going we're going to end up with no taxes on anything else. We're going to end up with total capitalist control. And this is all a sort of a mirage.”

Property rights and the ability to borrow against land are necessary for a market-oriented economy, but the deeper question is what system creates those rights, and you cannot simply drop property rights onto another system and expect them to function—they must emerge from the system's own logic.

“The problem is it's a bit of a chicken and egg thing. Where do those rights emerge from? What sort of system creates those rights in and of itself? Can you just drop the property rights on another system and say you're off the races now, you can borrow from the bank against the land, go for it. It seems not.”

Singapore has nearly century-long leasehold properties from the 1960s that are now drifting toward expiration, and the question of what to do when a large portion of the country's population reaches lease expiry is still unresolved.

“In Singapore, which has this unique, extremely unusual public-private system of housing, extremely high homeownership rates, but it's very tightly managed by the government, but they're all leasehold properties. So, the the sort of uh the nearly century-long leases, if you think about Singapore founded in the middle of the 1960s, are sort of drifting towards coming up for the earlier homes. And the question of what you do when a very large portion of your country uh finds themselves at the expiry of these leases is still not clear at all. So, that that can cause problems.”

Henry George fell between libertarian and socialist worlds ideologically—with strong egalitarian/redistribution commitments alongside free trade and anti-tax libertarian impulses—a contradiction that became much more difficult in the 20th century.

“I think you can start to see from the description a little bit of the seeds of where it went wrong for Georgism in the sense that he's got these libertarian ideals, he's got these strong ideas about inequality and egalitarianism and redistribution. And he sort of falls between these two worlds. Um in a way that became much more difficult in the 20th century.”

The number of actual successful efforts to implement land value taxation was very small relative to the level of popularity that the idea had in the late 19th century.

“So, the the number of actual successful uh efforts to bring this in uh is very small relative to the the level of popularity that the idea had.”

In China, the 1994 tax and spending system reform shifted fiscal power from local to central government—local governments went from being roughly fully funded to only able to afford 60-70% of their spending obligations overnight, forcing them to turn to land sales as a way to fill the gap and eventually transforming land sales from a tool for productive allocation into a mechanism to raise maximum revenue.

“the central Chinese government in 1994 changes the tax and spending system in China and instead of the local and provincial [19:55] governments doing almost all of the tax raising and almost all the spending, the central government says, "No, okay, this is over. You're going to do all of the taxing, but the tax money comes to us. We will decide how much you get back, right?" So, overnight local governments in China go from sort of roughly fully funded to only able to afford 60 or 70% of their spending obligations. And they turn eventually to land sales as the way to fill the gap. So, this starts to become not a way of allocating land most productively, not [20:26] necessarily a way of making sure that you're raising enough money for the land sales to uh to build the infrastructure out to whatever factories or apartments or whatever you're building. It becomes a way to raise as much money as possible.”

Chinese households rationally concluded that buying housing and as much of it as possible was the correct investment strategy because the Chinese stock market has gone sideways while the economy grew 8-10 fold, bank accounts offered negative real returns, and there was an understanding that the government wouldn't let house prices fall, so the optimal strategy was to buy multiple apartments even if leaving three empty was necessary.

“If you're not buying apartments or apartment leases, what else are you doing? The Chinese stock market has gone functionally sideways during a period in [20:56] which the Chinese economy's, you know, grown eight 10-fold. Bank accounts, terrible, negative real returns for most of of modern Chinese history on a Chinese bank account. It's been awful and the uh the the conclusions of this most Chinese families and the correct rational conclusion in the system they're living in is to buy housing and as much of it as they can get their hands on. If it means buying multiple apartments and leaving some of them empty, if it means buying four apartments and leaving three of them empty, that's still the right [21:26] thing to do. There was an understanding that the government wouldn't let house prices go down and that things had to continue on this path.”

Sun Yat-sen, first president of the Republic of China, had an idea (since revived by economist Glen Weyl) to solve land valuation through self-assessment—people declare their land's value and pay taxes on that declared value, but the government has the right to purchase the land at that declared price, creating an incentive to not undervalue the property.

“Sun Yat-sen, first president of the Republic of China, had an idea, which actually uh Glen Weyl, an economist, has [45:54] has since sort of tried to revive. You can [clears throat] have a valuation regime based on what people tell you, right? You own a plot of land, you say it's worth a million dollars, we'll tax you based on it being worth a million dollars. But if the government then wants to buy your land for a million dollars, they're allowed to do it, That's interesting.”

During the Industrial Revolution, factories needed specific locations based on water access for steam power, proximity to rivers and canals for transportation, and access to large labor forces, meaning location-dependent returns to land were obvious and measurable in a way that is less true in dematerialized knowledge economies.

“land Mhm. Um used to be so much more obvious, right? So you would have a factory during the Industrial Revolution it would need access to water to power the steam stuff and uh like load the ships and to get to the canals to get to the river to get to the ocean to the yada yada yada. You need, you know, proximity to a big labor force”

Property rights formalization is promoted by the World Bank and other institutions, but didn't have the revolutionary impact de Soto hoped—the results have been a mixed bag, less impressive than expected.

“this world of intangible assets, of incorporeal things, of digital technology the one thing I can say relatively confidently at the moment is it's very difficult to lend money against these things. Mhm. Right? If you're a banker or a lender of any other type, valuing uh an idea, a piece of software, a network effect at a tech company is nightmarishly difficult, which is why only uh a handful of very skilled investors try and do this. Most of them get it wrong and those that get it right are paid enormous amounts, but this is not something a bank branch manager is going to be able to do.”

Intangible assets (ideas, software, network effects at tech companies) are very difficult to value and lend against, which is why only a small number of skilled investors attempt it, most get it wrong, and those who get it right command enormous fees.

“this world of intangible assets, of incorporeal things, of digital technology the one thing I can say relatively confidently at the moment is it's very difficult to lend money against these things. Mhm. Right? If you're a banker or a lender of any other type, valuing uh an idea, a piece of software, a network effect at a tech company is nightmarishly difficult, which is why only uh a handful of very skilled investors try and do this. Most of them get it wrong and those that get it right are paid enormous amounts”

In principle, government ability to purchase land at declared valuations would work as an incentive-aligning mechanism for honest land valuation, but in American political culture this would be politically dangerous because the idea that government can snap up your land would be extremely unpopular.

“That's interesting. Yeah. It's an incentive to not uh BS the the the valuation of it. That said, it's difficult to see something like that working in America because I think the idea that the government can sort of snap up your land from you Yeah. very politically dangerous.”

Land sales transformed from a tool for productive allocation and reasonable infrastructure financing to a mechanism for raising as much money as possible, which created terrible incentives for local governments to oversupply and overprice land without regard for actual productive capacity or housing demand.

“So, this starts to become not a way of allocating land most productively, not necessarily a way of making sure that you're raising enough money for the land sales to uh to build the infrastructure out to whatever factories or apartments or whatever you're building. It becomes a way to raise as much money as possible.”

Henry George was inordinately more famous than any socialist thinker during his lifetime and after, with Karl Marx endlessly complaining about him in his letters.

“up until the Russian Revolution and certainly while uh George was alive in the late 19th century, he was inordinately more famous than any socialist thinker anywhere on either side of the Atlantic, you know. Karl Marx in his letters endlessly complaining about this guy, right?”

Land is fundamentally different from other commodities because its supply is essentially fixed in most places, and a piece of land's value varies enormously based on its proximity to population and economic activity, not on intrinsic qualities of the land itself.

“the supply of land is pretty much fixed. That's why people treat it differently. Right? It it's not uh, 100% binding but other than a few pretty small parts of the world the the sort of real estate developer line that they're not making any more of it is effectively true.”

Hong Kong and Singapore both inherited leasehold systems from British colonial administration and adapted them to finance government spending, especially infrastructure, by having colonial governments own all land and lease it out for productive use, generating revenue to fund roads and basic government functions.

“Singapore and Hong Kong, which [11:00] both inherited these fascinating leasehold systems from the UK. Um so, they were used to finance government spending, uh especially government infrastructure building. Uh the idea was that the colonial government owned the land in these places and would lease it out uh for productive use, could raise money from that to build roads and all sorts of other infrastructure, uh run the very basic elements of government.”

Karl Marx himself complained extensively in his letters about Henry George, calling his ideas a 'secret capitalist plot' because George wanted to separate land from capital and eliminate all other taxes—Marx argued this would result in total capitalist control and was a mirage designed to distract from deeper problems.

“Karl Marx in his letters endlessly complaining about this guy, right? This this American land taxer who I think I think Marx actually nails him to some degree in that he says he's a, you know, this is a secret capitalist plot, right? Because he's trying to separate land out from capital. He's going we're going to [39:08] end up with no taxes on anything else. We're going to end up with total capitalist control. And this is all a sort of a mirage.”

David Lloyd George's People's Budget in 1909 attempted to implement a small land value tax in Edwardian Britain as a foot-in-the-door that would rise later, but became an administrative nightmare—the valuation office was unable to complete valuations before World War I, the process dragged out political battles that had to be refought repeatedly, and after the war it was never properly picked up again.

“David Lloyd George is Chancellor of the Exchequer. And he brings in the People's Budget in 1906 and tries to bring in a uh tax on land values. Very very small [37:35] tax on land values, extremely low in in the grand scheme of things, but it's the the point of getting your foot in the door, right? It will rise later. Um it's an administrative nightmare. The government of Edwardian Britain is not up to the task here. So, the valuations office set up. It's a it's a terrible effort for years and years and basically Britain stumbles into the beginning of the First World War having not completed this task this valuation task. And it's essentially something [38:07] that is obviously halted during the process of the First World War and not picked up again properly afterwards.”

Hardcore Georgists tried to establish utopian communes along Georgist lines, such as Arden in Delaware and Fairhope in Alabama, which had some vague initial success but eventually became normal towns as the Georgist principles leaked away over time.

“A lot of really hardcore Georgists tried to set up their own sort of utopian communes. You have places um Arden in Delaware and uh Fairhope in Alabama, um which are attempts to set up along Georgist lines. A society, um which have sort of some [40:43] vague success for a few years. They're just normal towns now, you know, the stuff sort of leaks away over time.”

Hernando de Soto was probably the most influential development economist of the second half of the 20th century and advanced the argument that access to property rights, particularly for land in the developing world, is necessary for liberal democracy and functioning capitalism.

“Hernando de Soto not really a a sort of academic economist in the way that we think of. I think probably the most influential development economist nevertheless of 20th century, certainly of the second half of the 20th century. And he comes through and basically gives this idea that you need access to property rights and and in the developing world this means property rights for land more than anything else to have liberal democracy or really functioning capitalism.”

Arrow's Impossibility Theorem demonstrates that all election systems have inherent problems and fairness issues, meaning all voting systems and primary systems are always pursuing least-bad options rather than perfect solutions.

“In political science, there's this I think his name is Kenneth Arrow, and he's got this understanding of how basically every election model just has a problem, right? That there's some I'm I'm butchering it and I'm not doing it in academies, but there's there is some inherent filtering pro- sorting mechanism problem [17:51] that is unfair in some circumstance in some way, and so all forms of primaries um and elections pro- systems um are you're always always going to be pursuing the least bad option rather than a perfect option, right?”

Looking Backward by Edward Bellamy was one of the first utopian science fiction novels, hugely influential in the late 19th century, and spawned Nationalist Clubs that overlapped with Georgist movements, but has been almost entirely forgotten today despite its historical significance.

“There was also, you know, Edward Bellamy had this book Looking Backward, which was a one of the the I think it's credited as being like the first utopian science fiction. And um or close to it. Um hugely influential. Utterly forgotten today...one of the things that came out of Looking Backward, it's basically a Rip Van Winkle story...Nationalist Clubs, which I had a lot of overlap at the time with with the Georgists. And um [33:57] utterly forgotten today. I mean just utterly forgotten.”

Charles Murray's standard response when asked how Sweden reconciles welfare and social success was that there's a well-established finding that pretty much any idea works for a while with Swedes if you have high communitarian cooperation, and that this explains why communes, kibbutzes, and various social experiments succeed initially before eroding over time.

“Charles Murray once he used to get asked all the time when he was doing stuff about welfare reform, well, how do you explain Sweden's success? And his standard answer was something like, [41:15] well, look, there's a well-established finding in the social science literature that pretty much any idea will work for a while with Swedes. Um if you have a very just have a very high level of communitarian cooperation, you can work on, you know, you can be a Skinnerist or you can be a Shaker, you can be all sorts of things, you know, and you know, the kibbutzes worked when there was just massive amounts of social solidarity”

Extremely low rental yields—1% or lower in expensive Chinese cities—indicate exuberant bubble-like behavior because rental yields should align with property prices over time as an asset with certain risk, and when they diverge, it signals that investment is driven by price appreciation expectations rather than income-generating fundamentals.

“rents in most of these really expensive cities are astoundingly low Yeah, okay. uh relative to the price of housing. So, the rental yield you get as [23:30] an investor is, you know, it's often sort of 1% or lower. Um you know, absolutely astoundingly low rental yields. And I think it's that it's that split to me that often indicates you saw in Japan, you saw it actually in, you know, parts of the US and UK in the run-up to the global financial crisis. It's those rental yields dripping to really, really low levels. Mhm. Um that's usually the signal that there's some sort of uh exuberant bubble-like behavior, right? Because they should they should align over time. It's a it's a it's an asset with a certain amount of [24:01] risk. Um when they stop doing that, and they haven't in China basically in China's entire modern history, um it's a sign of a problem.”

The idea of government being able to take your land if you declare its value is politically very dangerous in America because it threatens fundamental property rights conceptions, making Sun Yat-sen's incentive-compatible self-assessment solution difficult to implement despite its technical elegance.

“That said, [46:25] it's difficult to see something like that working in America because I think the idea that the government can sort of snap up your land from you Yeah. very politically dangerous.”

Land valuation is vulnerable to corruption because property owners have incentives to undervalue their land to avoid taxation, and governments would need to determine valuations that people don't want to declare, making corruption likely given the high financial stakes involved.

“I can't imagine something more vulnerable to corruption than a government agency setting the value of land, um where you you would want it to be assessed as low as possible and given the the stakes involved, you know, slipping some”

The supply of land is pretty much fixed, which is why people treat it differently from other commodities—once someone owns it and utilizes it, it's not available for someone else to use, making it quite different from other assets and goods.

“the basic idea and it's something I deal with in the book um, that started all of this especially in Europe is that the supply of land is pretty much fixed. That's why people treat it differently. Right? It it's not uh, 100% binding but other than a few pretty small parts of the world the the sort of real estate developer line that they're not making any more of it is effectively true. And and to that Rousseau quote, once one person possesses it, owns it, is utilizing it, it's not available for someone else to use.”

Arthur C. Clarke predicted in the early 1960s that communication technology would transform society more dramatically than any transport technology and that cities would cease being necessary as an organizing mode of human civilization—but this prediction proved dramatically wrong.

“There's a guy called Arthur C. Clarke Mhm. who was I always think this is a a futurist, right? You know, what a what a great job title. But you know, he wrote 2001 a Space Odyssey, really really interesting guy. If you go back to the things he was talking about in the early 1960s, it seems fascinatingly prescient. He's pretty plugged in to the development of uh early semiconductor technology, transistors, and he sees immediately this going to transform communication technology and then it's going to transform from transform the the world after that, right? Everything is going to change because we're going to be able to communicate at extraordinary distance um cheaply and the the way we think of society is operating now is going to change uh more dramatically he thought than you know any transport technology had previously changed it. And one of the that'll be the end of the city as the organizing mode of human civilization. That'll be out the window, right?”

Reliable returns on investment for basic human needs will always exist in ways that speculative assets won't, making land and basic resources valuable across time.

“reliable source of re reliable return on investment is always going to exist for basic human needs in ways that other things won't. And I think land is sort of tied to that as well. They're always going to need it, right? Because we have to live in meat space.”

Friedrich Hayek first became interested in economics because of Henry George, and William F. Buckley loved Henry George, showing that Georgist ideas influenced conservative/libertarian thought despite George's egalitarian redistribution proposals.

“Friedrich Hayek says he first got interested in economics because of Henry George, right? So, like there's this whole branch of libertarianism that you can trace back to Henry George. William F. Buckley, you know, my former boss, loved Henry George.”

Progress and Poverty, published in 1879, was probably the best-selling book in the world after the Bible in the late 19th century, with millions of copies sold by multiple publishers in the UK and US, and was the most influential book of that period.

“Progress and Poverty was not an immediate success, but in the very late 19th century, we don't have a Time's best-seller list, but in the very late 19th century, best guess this is probably the best-selling book in the world after the Bible. Um certainly, I think the most influential during that period. You know, you have millions of copies sold by multiple publishers in in the UK and US. There's really nothing else at this time that captures the public imagination this way.”

Hernando de Soto is not primarily an academic economist but is probably the most influential development economist of the second half of the 20th century, arguing that access to property rights (especially land) is necessary for liberal democracy and functioning capitalism.

“Hernando de Soto not really a a sort of academic economist in the way that we think of. I think probably the most influential development economist nevertheless of 20th century, certainly of the second half of the 20th century. And he comes through and basically gives this idea that you need access to property rights and and in the developing world this means property rights for land more than anything else to have liberal democracy or really functioning capitalism.”

In colonial North America, English settlers became extraordinarily wealthy in land precisely because the land supply seemed inexhaustible compared to England, where land supply was fixed, and this exceptional land abundance drove a unique culture of exploiting land's financial value to turn it into money and encourage economic activity.

“the English and then British colonization of North America where you went from a place where the supply of land was fixed and everyone owned everything in in England in the United Kingdom to a place where the land supply suddenly seemed not to be fixed. Um, the early colonists absolutely enormously wealthy in land, right? Um, they didn't know how far the world they were expanding into would go but the land seemed like the most plentiful thing that they had. Um, and and the use of it in finance really I think stems from that. This extraordinarily land rich society, the comparatively very equal society doesn't really have the the same sort of class system as you had in England or other parts of Europe. And this enormous drive to exploit the value of the land, to turn it into money”

In early 20th century Britain, David Lloyd George as Chancellor introduced the People's Budget in 1909 with a small tax on land values—meant as a foot in the door that would later increase—but the valuation process was an administrative nightmare that stretched on for years and essentially halted during World War I, never to be properly resumed.

“David Lloyd George is Chancellor of the Exchequer. And he brings in the People's Budget in 1906 and tries to bring in a uh tax on land values. Very very small tax on land values, extremely low in in the grand scheme of things, but it's the the point of getting your foot in the door, right? It will rise later. Um it's an administrative nightmare. The government of Edwardian Britain is not up to the task here. So, the valuations office set up. It's a it's a terrible effort for years and years and basically Britain stumbles into the beginning of the First World War having not completed this task this valuation task. And it's essentially something that is obviously halted during the process of the First World War and not picked up again properly afterwards.”

The first major non-religious, cross-border ideological movement of the modern era was Georgism, with Henry George clubs and single tax clubs popping up everywhere in the mid-1880s, influencing local and municipal politics extensively.

“Really, I would say the first major not specifically religious sort of cross-border ideological movement of the modern era is Georgism. And his solution to all of this is you have a 100% tax on the value of land, which means really the rental income that land gives you is taxed at 100%. You shouldn't receive any of that. If you build something on top of the land you live on, you should uh you should receive rent for that. That's fine. Um but the land value itself should be completely expropriated and shared socially. He's a relatively libertarian guy in many ways. He doesn't believe in effectively any other taxes. It's why they start calling the land value tax the single tax. Right. Huge free trader, right? Huge huge. Yeah. Yeah.”

Very low rental yields (often 1% or lower) in expensive cities like China indicate exuberant bubble-like behavior, because rental yields should align with property prices over time given the asset's risk profile.

“rents in most of these really expensive cities are astoundingly low Yeah, okay. uh relative to the price of housing. So, the rental yield you get as an investor is, you know, it's often sort of 1% or lower. Um you know, absolutely astoundingly low rental yields. And I think it's that it's that split to me that often indicates you saw in Japan, you saw it actually in, you know, parts of the US and UK in the run-up to the global financial crisis. It's those rental yields dripping to really, really low levels. Mhm. Um that's usually the signal that there's some sort of uh exuberant bubble-like behavior, right? Because they should they should align over time.”

Henry George was 'inordinately more famous than any socialist thinker anywhere on either side of the Atlantic' during the late 19th century while he was alive, demonstrating his unprecedented cultural reach before his ideas were displaced by the hardening of left-right politics.

“up until the Russian Revolution and certainly while uh George was alive in the late 19th century, he was inordinately more famous than any socialist thinker anywhere on either side of the Atlantic”

Land valuation for tax purposes is vulnerable to corruption because property owners have strong incentives to have valuations set as low as possible, and the stakes are high.

“I can't imagine something more vulnerable to corruption than a government agency setting the value of land, um where you you would want it to be assessed as low as possible and given the the stakes involved, you know, slipping some”

Chinese households rationally believe the government won't let house prices go down significantly and that this path must continue, so buying multiple apartments even if three are left empty remains the right investment strategy.

“There was an understanding that the government wouldn't let house prices go down and that things had to continue on this path. So, what started out as a tool that was incredibly powerful for financing local government and really worked very well to build out Chinese cities.”

George's diagnosis was particularly appealing in the US because the frontier was closing—people whose ancestors had arrived 50-100 years earlier could head west and carve something out for themselves, but by George's time this was no longer possible, making the loss of land access feel immediate and real to ordinary Americans.

“I think this is particularly appealing at the time in the US because the frontier is basically closing. So, you're going from a period where 100 years earlier, people's ancestors might have arrived in the United States even 50 years earlier and been able to head out west and carve something out for themselves. That's done really by the time Henry George is emerging as a major figure.”

George's solution was a 100% tax on the value of land (the rental income it generates), which he called the Single Tax because he believed this should be the only tax—all other taxes should be eliminated because land's value is socially created and should be shared socially, while improvements built on land should remain privately owned.

“his solution to all of this is you have a 100% tax on the value of land, which means really the rental income that land gives you is taxed at 100%. You shouldn't receive any of that. If you build something on top of the land you live on, you should uh you should receive rent for that. [31:18] That's fine. Um but the land value itself should be completely expropriated and shared socially. He's a relatively libertarian guy in many ways. He doesn't believe in effectively any other taxes. It's why they start calling the land value tax the single tax. Right.”

Wilhelm Schrammier, a colonial administrator in the German government of Qingdao, China, was an obsessive land tax advocate who implemented a full land value tax system and ran the city according to Georgist principles for several years, representing one of the few comprehensive attempts to implement pure Georgism.

“The German government in Qingdao in China is run by a guy called Wilhelm Schrammier. Uh he's the colonial administrator and [40:11] he's a land tax guy. He's a sort of obsessive and he brings in a a sort of you call it sort of full fat land value tax and ran the city that way for several years.”

De Soto's insight about property rights formalization showed early revolutionary impacts—projects in Thailand massively boosted bank lending and entrepreneurial activity, improved education access for recipients, and seemed to show that formalizing land titles would be extraordinarily productive for development.

“some of the early results of this are colossally successful. Mhm. Um you have uh projects in Thailand that that massively boost bank lending, they boost the [50:34] entrepreneurial activity of the people involved who have been given title. These people are able to educate their children because they're able to access capital. You're seeing growth sort of speed up and it seems like this will be an extraordinarily uh productive thing.”

George wrote in the style of a lay preacher using biblical language and religious undertones to describe social injustices, which made his economic arguments dramatically more engaging to ordinary American, British, and European readers than abstract economic writing had been, contributing to Progress and Poverty becoming a massive social movement on both sides of the Atlantic.

“He writes like a sort of lay preacher. It's very religious, you know, barely an undertone. He's very religious man and he's happy to use sort of biblical language in describing the injustices that he sees. And this becomes a gargantuan social movement [30:47] on both sides of the Atlantic.”

Henry George's central argument in 'Progress and Poverty' was that despite unprecedented technological progress (trains, electricity, telephones, medical advances), industrializing societies were experiencing crushing urban poverty, and the solution was that land concentration allowed owners to capture all economic surplus and gains from technological progress because landowners could appropriate the wealth created by technological advancement.

“everyone in the United States and everywhere in the in the industrializing world at the time could see they live in [28:43] an era of technological change unlike anything the world has ever seen. We're talking about trains, electricity, telephone, lighting, the development of medical technology, all sorts of other things. This is a sort of era of mass industrialization beginning. Um and at the same time, you have these sort of crushing forms of urban poverty...Henry George comes along and says, "It's land. It's all land." Land is concentrated and the people that own it are able to mop up the gains of all of these amazing technologies. Um and they're able to mop up essentially all of the sort of economic surplus in society. All of the the growth in [29:45] productivity and wealth is just going to go to the landowners.”

Arthur C. Clarke predicted in the early 1960s that development of semiconductor technology and cheap long-distance communication would transform society by eliminating the geographic constraints on work and living arrangements, eventually leading to the end of cities as the organizing mode of human civilization.

“There's a guy called Arthur C. Clarke Mhm. who was I always think this is a a futurist, right? You know, what a what a great job title. But you know, he wrote 2001 a Space Odyssey, really really interesting guy. If you go back to the things he was [55:15] talking about in the early 1960s, it seems fascinatingly prescient. He's pretty plugged in to the development of uh early semiconductor technology, transistors, and he sees immediately this going to transform communication technology and then it's going to transform from transform the the world after that, right? Everything is going to change because we're going to be able to communicate at extraordinary distance um cheaply and the the way we think of [55:47] society is operating now is going to change...And one of the that'll be the end of the city as the organizing mode of human civilization. That'll be out the window, right?”

Early results of property rights clarification projects, such as those in Thailand, massively boosted bank lending and entrepreneurial activity for people given titles, enabling them to access capital for education and growth, with early projects seeming extraordinarily productive.

“Some of the early results of this are colossally successful. Mhm. Um you have uh projects in Thailand that that massively boost bank lending, they boost the entrepreneurial activity of the people involved who have been given title. These people are able to educate their children because they're able to access capital. You're seeing growth sort of speed up and it seems like this will be an extraordinarily uh productive thing.”

Edward Bellamy's Looking Backward was one of the first utopian science fiction novels and was hugely influential, spawning Nationalist Clubs that overlapped with Georgist movements, but the book and its influence are now utterly forgotten despite being a major intellectual force in the late 19th century.

“That gave birth to these things called Nationalist Clubs, which I had a lot of overlap at the time with with the Georgists. And um utterly forgotten today.”

Most developing world land reform movements after WWII failed to redistribute significant amounts of land and were often corrupt, suggesting that redistributing a widely-distributed asset is politically and administratively much more difficult than establishing systems at the outset.

“You see these land reform movements to try and redistribute lots of land. They work in some parts of East Asia. Most places they don't work. Not a lot of land is redistributed. It's often quite corrupt. Um it often causes a lot of social difficulties and political difficulties as well.”

Freehold ownership—owning land forever with the ability to pass it down indefinitely—is a very powerful tool for permanence because land, unlike businesses or equipment, does not decay or depreciate, making freehold particularly attractive in places like America where land supply historically seemed abundant.

“Freehold. You own the land, you own the land forever. And since it's it's not an asset that decays or depreciates in itself. The stuff on top [9:59] of it can't. That means you hang on to it, you can hand it down indefinitely. It's not like a business, it's not like a a real property, it's not like a piece of equipment. Everything else sort of decays, land doesn't. So, freeholds are very powerful tool for the sort of permanence and in a place like America historically, leasehold just wouldn't have seemed that important, right?”

Post-WWII decolonization movements pursued land reform to redistribute land from colonists or colonial-era elites, but most land reform efforts failed to actually redistribute much land, were often corrupt, and caused significant social and political difficulties, with most air going out of the movement by the 1970s-1980s.

“You have a huge number of new countries become independent and they're all to some degree involved in sort of reforming the system of land... You see these land reform movements to try and redistribute lots of land. They work in some parts of East Asia. Most places they don't work. Not a lot of land is redistributed. It's often quite corrupt. Um it often causes a lot of social difficulties and political difficulties as well. By the 1970s and 1980s, all of the air has gone out from the land reform movement.”

Freehold ownership—where you own land forever and it can be handed down indefinitely because land doesn't decay or depreciate—is a powerful tool for permanence and stability, whereas leasehold systems where land reverts to the original owner after a set period (75-200 years) create different political and economic dynamics.

“the the the very basic level is freehold. You own the land, you own the land forever. And since it's it's not an asset that decays or depreciates in itself. The stuff on top of it can't. That means you hang on to it, you can hand it down indefinitely.”

The leasehold system in places like London can be useful when concentrated ownership exists, allowing a single owner to maintain the character of areas like Bloomsbury through shared standards and maintenance of terraced housing and public spaces.

“The benefit of leasehold, I would say, in a city like London, is in the places where you have a concentrated ownership, where you have one person that owns a very large space. And you can think about some of the really nice areas of London, like Bloomsbury and places like that. Those are often examples of exactly this. They're concentrated ownership. You want people to be able to own within them to some degree, and you want them to be able to uh settle there. But those areas are nice because everything is the same in those areas, because you have beautiful terrace houses, you have shared public spaces, the tiny parks in in terraces and things like that. You want that to be maintained, and having a single owner is a useful way of doing that.”

Knowledge workers in late 20th century concentrated in a few superstar cities not because they had to (communication technology could allow remote work) but because they wanted face-to-face access to other knowledge workers and the cultural capital those cities offered, driving up land values dramatically in places like San Francisco, London, New York, and various Asian cities.

“knowledge workers really want to be in and among one another. They want uh whether it's access to the sort of cultural capital that gives you or direct exposure to other people like yourselves. You see this doubling down of really really high income people moving to the same places, land prices absolutely exploding in these places”

Milton Friedman's famous quote 'Protectionism does to us in times of peace what our enemies do to us in times of war' is actually a Henry George quote, illustrating George's commitment to free trade and radically minimal government intervention despite his radical land redistribution proposals.

“Milton Friedman's favorite quote about free trade, you know, protectionism does to us in times of peace what our enemies do to us in times of war. It's a Henry George quote.”

By the mid-1880s, Henry George clubs and single tax clubs were popping up everywhere, becoming enormously influential in local and municipal politics, electing mayors and state governors primarily through Democratic tickets based on essentially Georgist platforms, before mostly disappearing by the middle of the 20th century.

“By the late 19th century, the the sort of mid-1880s, you see Henry George clubs, single tax clubs popping up everywhere. Enormously influential in local and municipal politics. You start getting mayors, you start getting state governors who are elected through the Democrats usually, sometimes through the Republican Party, on essentially Georgist tickets. Becomes enormously influential in, you know, all sorts of Democrat politics in the the early 20th century. And then sort of more or less disappears [32:54] by the middle of the 20th century.”

George's solution was a 100% tax on the value of land (the rental income), while buildings built on land would still generate rent to the owner, and he believed in effectively no other taxes—calling it the 'single tax'—and was a huge free trader.

“his solution to all of this is you have a 100% tax on the value of land, which means really the rental income that land gives you is taxed at 100%. You shouldn't receive any of that. If you build something on top of the land you live on, you should uh you should receive rent for that. That's fine. Um but the land value itself should be completely expropriated and shared socially. He's a relatively libertarian guy in many ways. He doesn't believe in effectively any other taxes. It's why they start calling the land value tax the single tax. Right. Huge free trader, right?”

The Kenneth Arrow impossibility theorem in political science shows that all election models have inherent filtering problems that are unfair in some circumstance, so all election systems and primary systems are always pursuing the least bad option rather than a perfect option.

“In political science, there's this I think his name is Kenneth Arrow, and he's got this understanding of how basically every election model just has a problem, right? That there's some I'm I'm butchering it and I'm not doing it in academies, but there's there is some inherent filtering pro- sorting mechanism problem that is unfair in some circumstance in some way, and so all forms of primaries um and elections pro- systems um are you're always always going to be pursuing the least bad option rather than a perfect option, right?”