Tag Archives: land value

The Financial Times  (on Wednesday, 18th September) carried an article by Martin Wolf “ Why rigged capitalism is damaging Liberal Democracy “ .He writes “Economies are not delivering for most citizens because of weak competition, feeble productivity growth and tax loopholes”

Guy Standing in his 2016 book “The corruption of capitalism” explained how capitalism has been corrupted as the security of the many has been weakened to strengthen the position of those who hold the bulk of society’s wealth. He wrote, “we have a rigged system that leaves those without much property with few rights”. He borrows from John Maynard Keynes’ critique of the rentier class — broadly, those who live on income from property, including patents and copyright, and investments. And like Keynes, he wants to see the end of the rentier on the grounds that the system they have created is both inefficient and grossly unfair. Those at the bottom Standing calls the precariat — the workers most exposed to the insecurity typical of this era of rentier capitalism driven by globalisation.

The unfairness of housing policy in the UK, one of the more egregious examples of the power of the rentier, is highlighted as are labour conditions in the era of apps, where data are used to monitor and control a workforce with little by way of employment rights. Standing writes that “the precariat’s vulnerability today is everyone’s tomorrow.”

Wolf asks the question “Why is the economy not delivering?” The answer lies, he says, with the rise of rentier capitalism. In this case “rent” means rewards over and above those required to induce the desired supply of goods, services, land or labour. “Rentier capitalism” means an economy in which market and political power allows privileged individuals and businesses to extract a great deal of such rent from everybody else.