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Who Owns the WorldThe Surprising Truth About Every Piece of Land on the Planet
By Cahill, Kevin
Grand Central PublishingCopyright © 2010 Cahill, Kevin
All right reserved.
OVERVIEW AND ANALYSIS
Of Wealth and Poverty, of Kings and Queens, of Power and Land, of the Planet and the Race
Income doesn’t make you wealthy. Assets do.
Advertisement for Portfolio Building Services, as seen in Financial Times, June 11, 2004
Poverty and wealth are not, as is often thought, opposites. Instead, the two words predicate a problem, poverty, and also indicate its solution—wealth. Land is the single most common characteristic of wealth worldwide. What the poor lack—land—the rich have in spades. In fact, land defines the wealthy to a far greater extent than cash. According to the World Wealth Report 2007 released by Merrill Lynch/Capgemini there are 9,500,000 millionaires worldwide totaling 0.15% of the population. Likewise, there are 3,200,000 in North America (mostly found in the United States) totaling 0.62% of the regional population. Of the earth’s 6,600 million inhabitants, few, perhaps just 15%, own anything at all, and most are pitifully poor. The distinguishing feature of universal poverty is landlessness. Yet there is no great movement to get land to the impoverished masses. Aid, yes. But land, no.
Land, though, is not scarce on our planet. There are 33,558,400,010 acres of land on earth, and only 6,600 million people to occupy those acres. (This excludes Antarctica, which is another 3,375,496,490 acres.) Notionally, there are 5.2 acres of land available to every man, woman and child on the earth.
|Rank||County||No. millionaire households||Percent of millionaire households households (based on states total population of millionaire households)|
Trying to Visualize Space on the Planet—It’s Difficult
If you are rich, 5.2 acres will not seem like much land. If you are among the 85% of the earth’s population who own no land at all, 5.2 acres will seem like a dream beyond avarice. Conventionally, geographers quote a statistic of persons per acre, square kilometer or square mile to demonstrate demographic distribution. Acres and acres per person on the other hand, will be the normal measurement(s) used throughout this book.
Acres per person clarifies three things. First: the actual availability of land in any given country in relation to the population. Second, it provides a much clearer picture of how land is used, as well as occupied, when a fuller picture of actual distributions within countries is presented later in the book. Third, it provides an indicator of the potential for wealth creation, as land is taken from rural areas, say, and converted to urban use.
An acre is a little larger than the area occupied by a soccer field. So, for example, every person living in the wide open spaces of America has a potential 8.2 acres available to them—the equivalent of about 8 soccer fields. The converse picture, of Americans per square mile, which is 77, falsifies the actual distribution and is purely notional. It is a figure that is true for statistics but not for the real world. The acres per American, on the other hand, is factual and true for the space potentially available. As we shall later see, the majority of Americans live in America’s 60-million-acre urban area, leaving the rural population in America’s real wide open spaces, with about 101 (38.1) acres apiece, based on potential availability. The overall picture throughout the world is composed by separating those two figures—the acres available per person in urban areas, and the acres available in rural areas—and excluding wasteland.
The question then is simple. If there is this much land available, why is there poverty? The answer is simple. It is called exclusion. Over 85% of the earth’s population is excluded from ownership of land. In 2006, 50% of all human beings lived in urban areas. Urban land is probably a maximum of 1,000 million acres, about 3% of the 33,558 million non-Antarctic acres that make up the land surface of the planet. Exclusion from ownership is the context in which poverty occurs.
The World’s Five Richest Men
William (Bill) Gates III: Chairman of Microsoft
Net worth: $40 billion
Warren Buffet: Chairman and CEO of Berkshire Hathaway
Net worth: $37 billion
Carlos Slim Helu & family: Chairman and CEO of Telemex, Telcel and America Movil
Net worth: $35 billion
Lawrence Ellison: Co-founder and CEO of Oracle
Net worth: $22.5 billion
Ingvar Kampard: Founder of Ikea
Net worth: $22 billion
Each individual’s wealth may be different at the time of publication as a result of the volatile economic climate.
Source: Forbes.com, March 3, 2009. Edited by Luisa Kroll, Matthew Miller and Tatiana Serafin.
The World’s Five Richest Women
Christy Walton & Family: Daughter-in-law of Sam Walton, founder of Walmart.
Net worth: $20 billion
Alice Walton: Daughter of Sam Walton, founder of Walmart.
Net worth: $19.5 billion
Liliane Bettencourt: Daughter of L’Oreal founder Eugene Schueller. She holds a controlling stake in the company.
Net worth: $15 billion
Susanne Klatten: Inherited from her late father a large stake in the auto manufacturer BMW.
Net worth: $12 billion
Birgit Rausing: After the death of her husband in 2000, inherited Tetra Laval, a multinational corporation headquartered in Switzerland that focuses on food processing and distribution.
Net worth: $11 billion
Each individual’s wealth may be different at the time of publication as a result of the volatile economic climate.
Source: Forbes.com, June 9, 2009. Steven Bertoni.
The word “exclusion” is used deliberately. Access to and use of land across the planet is determined, after nature has made its disposition, by ownership. Those not part of the ownership nexus, and consequently excluded from formal rights over, or access to and use of, land, save with the consent of the owners, constitute more than 85% of all human beings and may even be 90%.
In a nutshell, the root cause of poverty is the historic capacity of landowners to assign themselves the bulk of the land and to exclude all others from access or ownership of land, using what they call the “law.”
Landownership by a central power, usually the monarch, has an ancient history. This book will look to explore the transformation from poverty to comparative wealth, and its spread in the population of so-called developed countries. But this book will also show that it is the same underlying factor, the distribution of land, which lies at the heart of solving poverty in the developing world and of securing future economic development in the developed nations. As industrial employment declines in industrialized countries, the source of economic growth and development has shifted, from wages to real wealth, which are assets.
Those with the largest land assets have hastened to the propaganda barricades to prove that there is hardly any land in the world at all.
It is the creation of assets within the population which will solve poverty in the world, and economic stagnation too. It is not GNI that will measure the future wealth of nations, but GNAV: gross national asset value, per capita. And it is a rise in GNAV that will measure the true rise out of poverty of the world’s poor. Nations in the future will have not a GDP index but an asset index. The GNAV will have two categories. Private-land GNAV, based mainly on homeownership, which will be an indicator mainly of landed assets, and non-land GNAV, which will be an indicator of non-land assets—cars, etc. Each of the indicators will help make clear the gap between the wealthy, with fixed assets, and the relatively poor, those without landed assets. The real economic progress of all the countries can then be measured in a meaningful way, because the two measures, private-land GNAV and non-land GNAV, will between them yield a picture of how poverty is being eradicated and wealth created, and at what rate.
Where countries, populations and economies are concerned, the future is substantially predictable, excluding major catastrophes such as earthquakes, tsunamis, hurricanes and wars. Trends in populations and economics are well established.
What this book seeks to do is simple but also unprecedented. It seeks to establish an accurate picture of a current phenomenon, which is landownership, sufficient to disclose the historic trends which created the current reality, and also sufficient to make predictions about it.
Land Availability Worldwide
Below is a table of some of the world’s largest and most populous countries. The table shows the average Chinese citizen has twice as much homeland available to him or her than a citizen of the United Kingdom. India emerges as no more crowded than the UK, but Bangladesh is seen to be pushing the envelope badly, with land availability amongst the lowest of any country on earth. The table also reveals that 79% of the US population lives in urban areas, leaving one with a strong visual sense of just how much rural land and unoccupied real estate there is in the wide open space of America.
|Country||Total acreage||Urban acreage(est.)||Population||Percentage (and number) of population which is urban||Acres per person for the country as a whole||Acres per person living in a rural area|
Tables like the above enable us to establish basic, though very approximate, facts about existing patterns of land availability and use, and offer a new way of planning for increased wealth and diminished poverty. They provide a goal and a way to plan the journey.
But it doesn’t explain the existence of a vast mass of the poor, any more than it explains why the rich are just a tiny tribe. Aberrant landownership, as we have said, does that. It was neither nature nor God who built estate walls to keep the starving Irish from the food that would have saved their lives during the famine. Nor was it nature or God who built fences to keep the dispossessed English, Welsh and Scottish peasantry off their own land during the enclosures. It was landowners and Parliamentary law. It was not nature or God who forced the Native American people off the land that was once theirs. It was would-be English and European landowners. It was not nature or God who kept the Russian population as landless serfs. It was Russian landowners and Tsarist law. It was not, and is not, nature or God who donates one-eighth of the planet to twenty-six people. It was forceful theft, followed by bent laws, and now inheritance, fortified by an aberrant version of the principle of private ownership, especially of land.
For here is a gorgeous contradiction. This book asserts that the main cause of most remaining poverty in the world is an excess of landownership in too few hands. The book will also assert that private ownership of a very small amount of land—one-tenth of an urban acre or an acre or two of rural land—granted to every person on the planet has the potential to, and, I believe, begin ending poverty on a global basis. The book will go further and reassert that the right to the direct ownership of land is a fundamental human right.
This book will hopefully demonstrate, as the Chinese government has actually proved, that the core concept of private landownership, even if limited to time-bound leases, is the single most important element in dredging the masses off the dung-heap of poverty. Conversely, as we shall show, it is the misapplication of the principle of private property which put the poor on the dung-heap in the first place and has kept them there throughout history.
The concept of the overwhelming right to own private property has deeper roots than might be supposed. To protect the primary human right, the right to life, both the European Convention on Human Rights and the UN Convention class a right to shelter as a basic human right. In practice, shelter needs to be more than a sheet of canvas on two sticks. Meaningful shelter includes, and has to include, the concept of security and with it a degree of permanence. Families are not one-night stands. Overnight shelter does not meet the requirements of the second human right.
It was a violation of this basic right, the right to secure shelter, which resulted in the deaths of hundreds of thousands, possibly millions, of Irish peasants during the famine in 1845–9. As the landlords evicted the starving peasants from their plots of dead potatoes, they invariably caused the peasants’ shelters or huts to be pulled down around their ears as the law permitted. This forced hundreds of thousands to live in holes in the ground, from which they were later rooted out and sent into the open countryside by troops acting on the orders of the landowners backed by the laws of the time. Ireland is classed as a temperate weather zone, but it is a wet temperate country and a cold one in winter. Without shelter in Ireland in winter, you die. Between one and two million people were murdered by landowners using, not abusing, the law, and by denying the peasants their right to shelter. The landowners did not have the peasants shot or bayoneted. They simply drove them, starving and sick, out of any kind of shelter, into the open countryside, as was permitted by law. The weather did the rest.
The right to private property, which may arise from many concepts, economic and otherwise, is fundamental to the protection of the second human right, the right to secure shelter. A thousand other catastrophes besides the Irish Famine have proved and continue to prove this fact on a daily basis. But in the complex urban structures which dominate the populations of the modern world, basic facts are often forgotten or obscured. In many countries, the right to secure shelter is undermined by landlords and by outdated concepts of landlord rights, written in and for another age. For instance, the concept of rent for a shelter not owned by the dweller is supposed to be fundamental to capitalism. It isn’t. It is an accident of a primitive and outdated concept of land use, mainly but not only central to feudal and medieval land tenure. The entire feudal and medieval structure rested on possession of land by a tiny aristocratic few and the payment of rent or service by the bulk of the population.
In the UK, private homeownership stands at 69% of all homes and is rising, if slowly. Private homeownership in Ireland stands at 79–82% and is rising but is probably close to its ceiling. In the US, private homeownership stands at approximately 60%. These three sets of facts, repeated around the world, state that “rent” is an outdated concept in economics.
People in developed semi-democracies no longer rent; they own. And it is out of private ownership that real democracy, as opposed to the neo-democracy we now endure, will finally arise. Not, however, before the third principle of economics is up and running. This is the mobility of land. This principle completes the underlying foundations of true capitalist economics and free markets, which is access by the entire population to capital assets and a free market in those assets. The true capitalist circle consists of the mobility of labor and the mobility of capital combined with the mobility of land. It is extraordinary that the fathers of modern economics, Adam Smith amongst them, failed to realize that if land is an inherent asset in the capitalist system, then it has to conform to the rules of the market of which it is such a critical component. It has to be, above all, available. In the landowner-bound world of the early economists, the idea of the mobility of land conflicted with the notion of landowner hegemony and the authoritarian structure of government that rested on universal ownership of all land by a small elite. In as much as this was a fundamental failure of analysis by the founding fathers of the dismal science, it was also a blunder that has left the West handicapped by totally unsuitable structures when it comes to land, especially in Europe.
To prove this, let us simply state the facts of landownership in modern Europe. In Europe, about 59% of all arable land is owned by between 360,000 and 720,000 people, many of them from aristocratic families. This number is between 0.3% and 0.6% of Europe’s population. How unsuitable these structures are follows from what these family groups obtain from their near-monopoly possession of land. The elite European landowners get at least 59% of the European Union subsidy for “farming” each year, which amounts to $28,000 million. It is an extraordinary situation. The richest people in Europe not only clip their tenants for rent but the taxpayer as well. Two bites of the cherry and no tax—most of Europe’s agricultural land is untaxed.
They are also paid to own and keep extremely valuable economic assets within a badly run business, which is agriculture. They are paid a fortune to keep the most critical economic asset in the capitalist system, land, off the market. Indeed, one can go further and say that they are paid a fortune to ensure that a proper market in land never develops.
Renting is becoming economic history. Of course, there will always be a role, everywhere, for rented accommodation. But its central role, as a source of rents for the privileged few, is over—as is its role as a significant factor in any modern economic model. The many in the developed countries are where human rights and human welfare say they should be: in their own shelter, which they own or hold in freehold possession and do not rent. They are exercising their deepest right, after life itself, which is to secure shelter. And, at the same time, they are where all future economic development is going to be focused: around the privately owned dwelling-place.
The Largest Landowners on Earth
The 35 monarchies, including the papacy, currently in place around the world, together rule over a third of the earth’s surface. Monarchical rule exists in 51 fully constituted states, and in 36 colonies and dependencies of the world’s 197 states. Together, 26 of those kings—it is mostly kings, emirs or sultans, rather than the female of the species—claim personal, legal ownership of about 20% of the surface of the planet, out of 36,933,896,500 acres.
And it is the claim by the 26 key monarchies to overall, feudal ownership of all land under their rule that gives away the game. The purpose of monarchical rule is the monarch obtaining supreme power, or something as close as possible to it, in any given state. Historically, this was done by force, with the successful bandit or criminal asserting suzerainty over all the land that he and his outlaws could control, and as much else as would yield to his blackmail.
The purpose of grabbing all the land in sight and beyond was simple. In earlier times, land was the source of almost everything, including, most importantly from the would-be monarchical point of view, rents. Claim all the land and all the rents were yours, and surplus land was an asset with which to bribe your followers.
But existing monarchs don’t live in the same era that we do. They remain ensnared in the past and are largely as they always have been: avaricious and wholly concerned with maintaining what power they have, irrespective of the cost to others.
And they have, to an extraordinary degree, done so by hanging on to this concept of royal or monarchical ownership of the ultimate freehold of all land over which they reign. The word “extraordinary” is used because, in a world where 5,500 million people own nothing at all, we have 26 leftovers from history getting away with a claim to own one-fifth of the planet.
But their capacity to sell an outdated shibboleth, that of private ownership of whole states, even to those who destroyed their ancestors, is unique and uniquely damaging in the modern age. The Russians who overthrew the Tsar in 1917, far from abolishing the core defect in the Tsar’s rule, which was the concept of the royal ownership of all Russian land, instituted a new and even more regressive form in the subsequent Soviet state. The Soviet state in fact became the Tsar reborn and ultimately collapsed because corporate or collective ownership can never replace widespread private and personal ownership of land. The Soviet Union collapsed because the United States, as the renowned historian and author Paul Kennedy showed, outgunned the Soviet Union economically, and it did so, according to Tom Bethell in The Noblest Triumph, because of widespread private landownership.
There are many reasons for the economic superiority of the United States, but the most commonly agreed factor amongst economists was, and is, the widespread private ownership of land in the United States. This will be dealt with in more detail later. For now, let us look at how the world is divided up, having discovered who the primary owners are.
This distribution of land amongst the 26 monarchies makes them richer by far than anyone on the Forbes list of the world’s billionaires. It establishes four of them as trillionaires. This is a very rare accomplishment on planet earth, even on a comparative basis with, say, the Roman emperors.
|Population Estimates for 2008, 2007, 2006||Rank||City||2008||2007||2006|
|Name||Country||Legal claim on land in acres||Approx. value|
Landownership in history through time and across the planet
History, seen from the perspective of the mass of the landless, is a record solely of those who “owned,” in whatever form, all land. These were mostly emperors, kings, queens and aristocrats, constituting less than 3% of the earth’s population at any one time and often a much smaller percentage than this.
For about 9,800 years of known history, humanity on the planet’s surface was divided into those claiming ownership of land—a figure of between 0.2% and 3% of the planetary population—and the remaining 97–99% of humanity, which owned nothing. The function of humanity itself—was threefold: to grow produce and generate tax for the owners, to pay loyalty to those owners, and to be cannon fodder for those owners. Beginning with the American Revolution, the relationship between the masses and the owners began to change. In 2007, about 16% of the planetary population have a fingerhold on land, by way of a domestic dwelling. Recalling that, historically, the assets of the owners were in fact the entire sum of assets on the planet, and that the assets of the rest of humanity were zero, or near it, this is actually the most profound economic change ever to occur.
Excerpted from Who Owns the World by Cahill, Kevin Copyright © 2010 by Cahill, Kevin. Excerpted by permission.
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