A great man in the name of Frederic Bastiat, wrote words that shall echo for eternity. He noted this.
“The law perverted! And the police powers of the state perverted along with it! The law, I say, not only turned from its proper purpose but made to follow an entirely contrary purpose! The law become the weapon of every kind of greed! Instead of checking crime, the law itself guilty of the evils it is supposed to punish! If this is true, it is a serious fact, and moral duty requires me to call the attention of my fellow-citizens to it.”
Like Bastiat, we feel we have a moral duty to warn Kenyans of the greatest robbery which is a foot in the name of the so called Vision 2030. Now, under the “Vision” 2030, one of the key planks is infrastructure like roads, railways and ports. There is nothing wrong with this at first glance for we need them. However, let the reader first appreciate the origins of this “vision” by visiting this site: (Visited on 20/3/2010).
Having seen the origin of this “vision,” let us now turn our attention to some obscure “business news” which did not and cannot compete with more “serious issues” like the “women affirmative” action, counties and regions and such kind of jazz. (DN informs us that: “Thika Road land soars OVER highway.”
Then, we are informed by Mr Ibrahim Mwathane, the director of Landscape Surveyors, that:
“The value of land in Ruiru and Juja areas is appreciating fast as a result of the ongoing re-engineering of Thika Road into a modern highway. real estate experts, the prospects of new structures and amenities have pushed up the cost of land along the vital artery as Chinese contractors build the country’s first eight-lane highway. ... “New infrastructure will play a big role in increasing the value of land. Prices have also risen due to speculative activities since building work started last year,”
Meaning of the above statement
The above facts, do confirm what we have stated many times here. Land values do not result from any labour or capital expenditure of landowners, but, from:
(a) from good governance funded by Wanjiku, and
(b) population increment.
Thus, courtesy of Wanjiku taxes (Remember, she walks to work hungry) the new infrastructures in tune with “vision” 2030 are being put into place. If we take Thika road as an example, we are told this:
- “Kasarani, Githurai, Ruiru, and Juja are burgeoning industrial and commercial centres. For example the cost of 80 metres by 100 metres plot in Ruiru has risen to about Sh1 million.”
- Land from Globe Cinema, Muthaiga and Ruaraka area is currently valued at between Sh20 million to Sh40 million an acre.
- The cost of land from Ruaraka to Githurai ranges from Sh3 million to Sh6 million. From Githurai and Thika, the value ranges from between Sh500, 000 to Sh1 million an acre in the rural setting while the value rises to between Sh1.5 and Sh3 million in urban centres.
“Ground rents, so far as they exceed the ordinary rent of land, are altogether owing to the good government of the sovereign,...Nothing can be more reasonable than that a fund which owes its existence to the good government of the state should be taxed peculiarly, or should contribute something more than the greater part of other funds, towards the support of that government."
In simple words, increased land values are a social/common product and no one has right in front of God and man and in justice and, or equity to monopolise it. Thus, in a free enterprise society, such monopoly ought to be extinguished. So, by refusing to extinguish this monopoly, what kind of economy do we have then? We answer socialism.
This is so because; socialism is denoted by DIVORCE BETWEEN LABOUR AND REWARDS. To the extent that, a few stand to make billions for doing nothing, for we suspect that, having known where these infrastructure will lie, these few, have moved to purchase these lands, we are practicing not free markets as we are told, but, socialism for the few. What is interesting is that, those few who believe in socialism are the first to accuse others of being socialists so as to confuse and frighten the ignorant masses who are being robbed.
Some have argued that, our views about land are motivated by Karl Marx views. Firstly, we ask, was also Adam Smith motivated by Karl Marx? Secondly, for anyone to link Karl Marx to land question betrays monumental ignorance on land question. For instance, during the English civil war, in 1659 (note the centuries before Karl Marx) Harrington warned that, Parliament was not to be trusted to reach a settlement that was good for the people, for it was likely to introduce the monarchy (sounds familiar?).
Although they did not love the monarchy, the gentry wanted a political formula that would protect its estates, i.e. land. Harrington’s advice for diffusion of land to those who had been dispossessed was at odds with the gentry. What did Harrington ask for? He had asked for compulsory education, election by ballot of the executive, executive drawn from all classes in rotation. They rejected such wise advice and brought the monarchy back on one condition. On MONEY MATTERS (remember what we have been saying about banks?), the landed class would determine public policy. It took centuries and rivers of human blood for even ballot to be accepted.
He also noted one truth that, popular government entailed the diffusion of land rights. This will take may be another 1000 years, for, it seems, just as Harrington was shouted at in 1659, we hear same echo, you are too utopians bwana Mwarang’ethe in the 21st Century. So, from this, we can see that, the idea of Karl Marx and land is a red herring adopted by those who dispossess Wanjiku to hide their crimes against humanity which has been going in modern times since 1235. Thus, let no one tell us about Karl Marx for we shall wonder how ignorant one can be in the 21st Century. Now, we ask, is there an alternative to this robbery in the name of “vision” 2030? We answer in the affirmative and give an example.
Hong Kong – A sterile Outcrop Transformed
The terms, on which Hong Kong was to be administered as revealed by Lord Aberdeen in 1843, the then UK’s Foreign Secretary is all we need state to silence would be detractors. He noted that:
"The principal source from which revenue is to be looked for is the Land; and if by the liberality of the Commercial regulations enforced in the Island, foreigners as well as British Subjects are tempted to establish themselves on it, and thus to make it a great mercantile Entrepôt, with very limited dimensions, Her Majesty’s Government conceived that they would be fully justified in securing to the Crown all the benefits to be expected from the increased value which such a state of things would confer upon Land. Her Majesty’s Government would therefore caution you against the permanent alienation of any portion of the land, and they would prefer that Parties should hold land under Leases from the Crown, the terms of which might be sufficiently long to warrant the holders in building upon their allotments . . . It would probably be advantageous also that the portions of land should be let by auction."
This was a clear case of Adam Smith's way of levying tax or communism if you are brainwashed by the modern “education.” And, it is self evident to all today, the integration of the public finance with private property rights has transformed what was a sterile outcrop on the edge of China into one of the most dynamic capitalistic economy. In fact, if Hong Kong had the natural resources we have in Africa, its economy would be more advanced than even of the USA by far. That is what awaits Kenya/Africa when it wakes up to the reality we preach here.
The facts of the Hong Kong economy were captured by Heritage Foundation (2003). When it came to income tax rates, the top rate was 17% in Hong Kong, in Singapore was 22%, in the UK, was 40%, and in the USA was 39.1%. As concerns marginal (average payer), it was 17% in Hong Kong, 8% in Singapore, 22% in the UK and 27.5% in the USA. As to corporation tax, in Hong Kong, it was 16%, 22% in Singapore, 30% in the UK and 35% in the USA.
The most interesting figures were in the government expenditure per cent of the GDP. In Hong Kong, the expenditure was 21.6%, Singapore was 18.1%, in the UK, it was 38.3% and in the USA was 30.4%. What is clear from the last figures is that, due to the tax structures in the UK and in the USA, which rob those who labour because land was monopolized under the guise of capitalism/free markets, these governments, are now forced to intervene in the name of so called welfare state. Unfortunately, such intervention is a dangerous delusion as is evident in mounting public debts which are will eventually bankrupt the UK and the USA. Also, this will be self evident in Kenya within the next 10 years (remember the “infrastructure bonds” we are issuing for these “vision” 2030 roads?)
Through the Hong Kong scheme, those who made/make money did/do not own land for windfall gains were/are captured by the colonial/current government through auctions. The result of this was/is low taxation as we show above, which thereby, enabled/s capitalists or the investors to make huge profits and high wages for workers. This philosophy remains the best kept secret of Hong Kong. While World Bank continues to pile infrastructure debts such as on Thika road on Wanjiku, we can see how Hong Kong uses its land values to fund its infrastructure while relieving those who labour from inquisition in the name of tax.
Some questions to ponder about
- Have some people with insider information about “vision” 2030 bought land along the infrastructural routes? If so, how many billions do they stand to make? If so, do these people believe in free markets or socialism?
- Instead of allowing a few idlers to pocket these billions, what if we took these values, and relieved our teachers, doctors, nurses, etc of taxes to the value generated by the infrastructures they have funded? More so, what would this do to our economy and wealth gap?
- If Hong Kong which has no natural resources is outperforming USA, can you imagine what Africa would look like if we adopted this system with all the natural resources we have?
- In the last few months, we have been screaming about a few millions that have been stolen. Of course, the World Bank joins in that cry. Why are these people silent about what Hong Kong does?
- To Phil, we ask, why is the ODM so hopelessly unable to sell such a wonderful idea to the masses who are confused to think land reforms means eviction of Kikuyu’s from RV?
- To PDM guys like Vikii, Deroo, we know you guys have gone to heaven and hell in search of “progressiveness” ideology. But, we ask, does this “ideology” of yours include what Hong Kong has done? And, if not, why?
- Finally, let the reader read the DN article, together with two articles we have posted here before, i.e. The First Principle in Drafting a Constitution and Why the New Constitution is Void Ab Initio. Once you do that, is the futility of the current “new constitution” which does not come even close to respecting the NATURAL RIGHT TO PROPERTY become self evident because, as we noted, it seeks to entrench ARTIFICIAL RIGHT TO PROPERTY, i.e. rent seeking?
Finally, as you watch the “new constitution” drama, remember these words by Bastiat which summarizes the ongoing constitutional “reforms.”
“As long as it is admitted that the law may be diverted from its true purpose — that it may violate property instead of protecting it — then everyone will want to participate in making the law, either to protect himself against plunder or to use it for plunder. Political questions will always be prejudicial, dominant, and all-absorbing. There will be fighting at the door of the Legislative Palace, and the struggle within will be no less furious. To know this, it is hardly necessary to examine what transpires in the [Kenyan] French and English legislatures; merely to understand the issue is to know the answer.”