Proposition America: Pay for What You Get and Get What You Pay For

Frank F. Bille

[A book self-published by the author, 1982 -- Part 1 of 3]

The following reprint of Mr. Bille's book repeats the author's use -- for purposes of emphasis -- of terms and phrases in full capitalization.

Is it not becoming more and more evident that there must be something FUNDAMENTALLY WRONG with the economic systems of the world?

Not only do the socialistic and communistic countries suffer from terrible oppression and under-utilization of human and natural potentials, with chronic shortage of food and consumer goods; but the so-called "capitalistic" nations also struggle with enormous difficulties in coping with the problems of INFLATION, UNEMPLOYMENT, HOUSING SHORTAGE, and a rapidly rising number of POVERTY-STRICKEN PEOPLE who must be supported by the governments at TAXPAYERS' EXPENSE.

Here in America, the high cost of HOUSING, FOOD, GASOLINE, INSURANCE and TAXES, which the hard working people must pay, is obviously detrimental to the American Way Of Life, DEMORALIZING to young couples who want to raise children, AGONIZING to the old folks with fixed dollar incomes, DESTRUCTIVE to the nation's moral fibre, and DISASTROUS to the nation's internal and external SECURITY.

The purpose of this book is to show that these tragic circumstances are the results of FALLACIOUS DOCTRINES of economics which are of ancient origin; PRECEPTS OF MEN contrary to the will of God but perpetuated through many centuries, wrecking nation after nation, kingdom after kingdom all through recorded history.

The rise and imminent DECLINE of the magnificent AMERICAN CIVILIZATION follows the same pattern as that of the Roman Empire, the Spanish, the Chinese, the Russian and the British Empires. In all of these civilizations there existed an adverse economic condition which slowly but steadily eroded their strength and made them vulnerable to internal and external enemies.

According to reliable statistics the NON-PRODUCTIVE labor force of America which in 1944 was one-third of the whole force has now in 1982 risen to two-thirds; the PRODUCTIVE labor force having been reduced from two-thirds to one-third. America is losing her place as the most productive and prosperous, peaceful nation in the world.

While the number of millionaires in America is growing rapidly, the number of unemployed, poor, dependent people is growing much faster. The number of property owners is declining while the number of renters is increasing. And the government is going bankrupt!



The explanations given by today's economists are utterly confusing and leave US the citizens little hope of betterment. The one great American economist whose name will be given later in this book provided us with the REMEDY a hundred years ago. Because this man has been so thoroughly misrepresented, ignored and maligned, to mention his name at this point would be to conjure up all the prejudice and professional ignorance accumulated through a century of misinformation.

As a true PATRIOT you are anxiously engaged in a good cause and would like to know exactly what's wrong with the American economy so that you could base your POLITICAL OPINION on facts. You would want to have an answer convincing to you as an educated person trained in making logical conclusions; convincing to you as an honest person who abhors all injustice. You would want a simple, clear-cut, unsophisticated explanation which could be understood, adopted and acted upon by the majority of the American people. Most of you good Americans would also want an answer that is convincing to you as a CHRISTIAN whose life is governed by obedience to the LAWS OF GOD.

Whatever the truth is, it must be the same no matter what criterion is applied to it.


PROPOSITION AMERICA gives you the simple, straightforward answer to a long list of perplexing economic problems and provides every American Patriot with a solution and a course of political action which has the power to solve practically all of the economic problems SIMULTANEOUSLY. This is possible because the problems have a COMMON CAUSE. When the FUNDAMENTAL FALLACY is corrected, a multitude of SOCIAL, ECONOMIC and POLITICAL problems are automatically solved.

The REMEDY is TRUE CAPITALISM, which is expressed in the subtitle: Proposition America: PAY FOR WHAT YOU GET AND GET WHAT YOU PAY FOR.

The COMMON but little understood CAUSE of universal economic trouble is that mankind has disregarded the instructions which the Maker of Heaven and Earth provided for the users of His Product, the earth. But when all else fails, then perhaps we will READ THE INSTRUCTIONS and do something about it.

We have violated the fundamental economic principle and the natural law decreed by the Creator, the law upon which the Lord's promise of material BLESSINGS are PREDICATED. It is impossible for the Lord to secure to us His endless blessings when we disregard His all knowing and wise instructions on HOW TO ADMINISTER His gifts of love.

The Fundamental Economic Principle which we have disregarded is THE PRINCIPLE OF PROPERTY RIGHT, and the specific Law of God which is clearly stated in the BIBLE but has been systematically ignored is THE LAW OF LIBERTY.

From these violations spring the CURSES of unemployment, underemployment, poverty, lack of housing, lack of food, lack of education, lack of freedom, economic slavery, oppressive and wasteful government and excessive taxation, enormous public and private debts, inflation and bankruptcy of individuals, businesses and of public entities such as New York City.

There is only one course of action which can carry the American nation forward towards the cherished condition of GENERAL PROSPERITY with LIBERTY AND JUSTICE FOR ALL, and which can save US from being destroyed by internal and external enemies:


The economic and political ORDER which would arise on these premises could be termed TRUE CAPITALISM as contrasted with the present mixture of FALSE Capitalism, socialism, communism, atheism and materialism. PROSPERITY would be within everybody's reach, and the LIBERTY of citizens would be restricted only by the equal rights of all others.

PROPOSITION AMERICA is meant to show, point for point, that this program is not an impossible dream; that our present so-called "capitalistic" system is an un-scientific, unnatural, self-destructive mixture of truths, half-truths and fallacies which will ultimately cause the destruction of the American Nation if we do not put a halt to it. There are only these two alternatives, self-destruction or redemption.

America's destiny is to lead the world in righteousness first, prosperity and peace being the natural consequences thereof. Ancient prophets have described America as "a land choice above all other lands" and have stated categorically that this choice land must be inhabited by righteous people who, if they become "ripe in their iniquity", will be destroyed.

PROPOSITION AMERICA is not based on a theory concocted by politicians as the result of an opinion poll. It is not of human origin, and this writer takes no credit for it. It is based on one single PRINCIPLE, which is of God and which cannot be disputed, the principle of PROPERTY RIGHT. The Kingdom of God is governed by sacred laws. If the principle of property right were not a sacred law the commandment that "Thou Shalt Not Steal" and "Thou Shalt Not Covet" would be meaningless.

PROPOSITION AMERICA'S aim is to restore to the American people all the RIGHTS, PRIVILEGES and BLESSINGS which the Lord God intended for us to have, and the key to all this is the God-given principle of Property Right, which is a far cry from that which by the precepts of men is called "property right."

Many of the good causes for which a multitude of fine American Patriots are willing to spend their lives would automatically be fulfilled if PROPOSITION AMERICA were enacted. Therefore, if our Patriots will endorse this ONE GOOD CAUSE, all the scattered and often fruitless efforts to save our country from a multitude of dangers will combine into ONE FORMIDABLE POLITICAL FORCE FOR GOOD, and America will fulfill her destiny.

PROPOSITION AMERICA, when endorsed by the people and made the LAW OF THE LAND by act of the Congress, will have far reaching, beneficial effects on the American economy.


In fact, ALL TAXATION of the products of human labor and industry will be ABOLISHED.

YET, all levels of government will have AMPLE REVENUE with which to carry out their LEGITIMATE FUNCTION, which is to SECURE JUSTICE by PREVENTING INJUSTICE. This revenue arises, without taxation, from the nation's COMMON HERITAGE, the free gifts of God.

GROUND DUTY is the appropriate name for this PUBLIC REVENUE which will replace all taxation. It is paid by all who partake of the UNEARNED BENEFITS arising from NATURAL RESOURCES, in proportion to the VALUE of their LAND HOLDINGS. It is called a DUTY because they OWE it to the COMMUNITY. The existence of this natural, equitable SOURCE of public revenue has been carefully concealed by the powers which rule the world, the powers which are responsible for the UNNATURAL, INIQUITOUS economic conditions just described.

These evil powers are appropriately referred to as MAMMON, and this book is an appeal to the greater powers which are known to exist, the powers bestowed upon those of us who will not knowingly serve the false god Mammon.

Since the concept of Ground Duty is unknown to most Americans it is necessary to give it careful explanation, which will be given throughout this book.

The Federal, State and Local Governments will be reduced to the size necessary for securing justice by preventing injustice. The functions of each level of government will be sharply defined.

There will be FULL LOCAL AUTONOMY in all matters which can be handled locally. Most government revenue will be collected by local governments, and higher levels of government (State and Federal) will be supported by APPORTIONMENT between local governments.

Governments will be organized and run in a business-like manner after the example set by executives of successful American corporations. Their responsibility will be to secure the greatest possible profit from the assets entrusted to them, and to yield the greatest possible DIVIDEND to their SHAREHOLDERS, the American people. Every citizen is born a shareholder.

Unlimited FREE PRIVATE ENTERPRISE will provide unlimited employment opportunities (unlimited because the natural opportunities are no longer monopolized). Consequently, there will be no involuntary unemployment and poverty. LABOR UNIONS will become OBSOLETE because PRODUCTION is limited only by the number of workers available. Employers will-compete with each other to get the best workers and will have to offer the highest possible WAGES. Every person will have an opportunity to develop MB TALENTS to the highest degree.

The blessings and joy of HOME OWNERSHIP and a happy family life will be within everybody's economic means.

There will be NO INFLATION, no recessions or depressions. PRODUCTION will rise to the limit of the nation's capacity, causing PRICES of goods to be SLOWLY FALLING while WAGES are stabilized.

The nation's MONEY SUPPLY will be created and OWNED by the national government through MONETIZATION of the interest-free national CREDIT, which is the credit given to the nation by all the money-holders in common, i. e. the people.

The NATIONAL DEBT will be ELIMINATED, and no new national debt will arise.

PRIVATE DEBT will be greatly reduced because title to land can be acquired without purchase price but on condition of paying the annual land rent called GROUND DUTY to the local government.

The secondary effects on the nation's cultural and social life will be immense.

The nation's economic strength will greatly increase our MILITARY STRENGTH and preparedness. Our prosperity will be of our own making and not at other nations' expense. We will still not have any reason for trying to dominate other nations, and our strength will be a deterrent to the aggressors.

The government will no longer have a. mandate to extend "Foreign Aid" or any other form of handouts to anybody. "Public Welfare" payments will cease, and the responsibility for taking care of the underprivileged, the sick and the needy will rest upon the individuals, the family and the charitable organizations formed for that purpose. Local government welfare assistance will be last resort.

The SOCIAL SECURITY System will be phased out, and the responsibility for securing a retirement fund will eventually rest upon the individuals themselves. However, it is expected that the GROUND DUTY FUND will yield a SURPLUS which can be distributed either as a DIVIDEND or as an old age PENSION.

All citizens will automatically be INSURED against economic losses which may befall them due to natural calamities such as fire, floods, earthquakes, untimely deaths, epidemics, etc. , or accidents. All such losses not due to any fault of your own will be re-compensated to you out of the GROUND DUTY INSURANCE FUND. There will be NO PREMIUM to pay, for the Ground Duty is the premium.

At this point of my "utopian" presentation my reader's irritation may have reached the boiling point, and the next paragraph, I warn you, may be "the last straw." But please read on! The full explanation of these unbelievable statements will be given later. Remember, our present economic system is an unnatural, cancerous organism. Having grown up with the unnatural, the natural order seems weird to us.


When the owners of land (improved or unimproved) have to pay the full Ground Duty to the local government they thereby LOSE all the UNEARNED PROFIT arising from land ownership. They also lose the INVESTMENTS in land because the land (apart from the improvements) can have NO MARKET VALUE when no unearned profit can be gained therefrom. The "capital" invested in land is referred to as FALSE CAPITAL.

Therefore, the land owners are entitled to a COMPENSATION for the loss of false capital which, to them, is very much a real capital, perhaps representing all their life savings.

The compensation to all the land owners for the false capital lost will be distributed once and for all in the year of the "Jubilee" in such a manner that every person retains for himself the same percentage of his NET WORTH as all others do. NOBODY suffers any REAL LOSS.

Details of this EQUALIZATION process will be given in a following chapter.

On the following pages will be given the SCIENTIFIC FACTS on which PROPOSITION AMERICA is founded, together with the MORAL, ETHICAL and RELIGIOUS reasons why these reforms CAN and MUST become a reality. The most compelling arguments for PROPOSITION AMERICA are found in the BIBLE and other sacred literature.

Before going into details, let's look at the PRESENT SITUATION:

The PRICE INFLATION is getting worse (1981. The SHORTAGE OF HOUSING is becoming desperate. It is almost impossible for the young couples to buy their first home and expect to pay for it out of the breadwinner's salary. HOUSE RENT runs as high as HALF of an ordinary family income. UNEMPLOYMENT is high and rising. POVERTY is becoming widespread. The NATIONAL DEBT is (1982) about to top the unimaginable TRILLION DOLLAR mark, and INTEREST thereon is about ONE HUNDRED BILLION dollars annually, to be paid by the taxpayers before anything else can be paid for. High INTEREST RATES on loans make it next to impossible for business and industry to expand and provide more jobs. BANKRUPTCIES are becoming an epidemic. TAXES take away what the inflation has left. INSURANCE PREMIUMS are painfully high. PRODUCTIVE INVESTMENT is DOWN, while UNPRODUCTIVE INVESTMENT is UP. FOREIGN COMPETITION is overtaking the American industry. FOREIGN INVESTORS buy up American land and American industry. Etc. , etc.

Economists disagree between themselves, but most believe (1982) that we are headed for a serious, if not catastrophic, breakdown of our economy. There is a real possibility that the inflation will run wild and render the dollar worthless, throwing the nation into chaos, in spite of anything the Reagan Administration can do. The President said in his speech on February 18, 1981: "There is nothing wrong with America that we, acting together, cannot fix. "True, provided -- of course -- that we KNOW what's wrong. That's the PROBLEM! The nation is not being informed of the FUNDAMENTAL EVIL that is wrecking America. Basic economic principles are not being taught in our institutes of learning, and though it is basically a RELIGIOUS and MORAL matter, no theologian is teaching it, no preacher is preaching it. Anybody who brings up the subject is usually ignored, or else he is ridiculed and in various ways effectively silenced.


IS IT NOT STRANGE that our combined DEBTS, public and private, have risen to an astronomical amount which EXCEEDS the total amount of ALL WEALTH owned by the American people and governments combined?

IS IT NOT STRANGE that you automatically OWE Uncle Sam an extra amount of dollars whenever you have made an extra effort to support yourself and your family; while, conversely, if you wasted your time and talents you may be eligible for an AWARD from the same U. S.?

IS IT NOT STRANGE that we must pay $50,000.00 to $100,000.00 for an ordinary, vacant residential lot, which the Lord God created and gave us FREE ?

IS IT NOT STRANGE that MONEY comes into existence whenever someone signs a note secured by real estate or wealth and hands the note to a bank; and that, on the other hand, money is EXTINGUISHED when the LOAN is paid off?

PERHAPS you have ready answers to these questions. Please write down your answers. After reading PROPOSITION AMERICA, please see the notes again.

We Americans believe in "Government of the people, by the people, for the people. "The Founding Fathers believed that a well informed, righteous electorate would produce well informed, righteous lawmakers who would make just laws beneficial to the people as well as the nation. They were inspired to formulate our CONSTITUTION which for two centuries has guided the American nation to the highest position of liberty, prosperity and power ever experienced by any nation on Earth.

Then HOW did we get trapped in this economic quagmire? HOW is it possible that a nation so wealthy, so powerful and possessing the world's finest constitution is about to go bankrupt and commit economic suicide?

The answer is that the Constitution, great as it is, does NOT define the fundamental economic principle without which our Pledge of Allegiance to One Nation, under God, with LIBERTY AND JUSTICE FOR ALL, becomes merely rhetoric.

AS A FORMALITY, we the people are still invited to express our opinions and preferences. Thank God for that!

But before BIG BROTHER cuts us off and makes it completely impossible for us the people to even attempt to GOVERN OURSELVES, let us FACE REALITIES and get down to BASICS! Until we the Electorate understand and apply the basic economic principles we will continue to be manipulated by the politicians who are forever trying to satisfy this or that special interest lobby. We can be manipulated because we do not have any STANDARD by which we can judge the Tightness or wrongness of laws dealing with matters of economics.

PROPOSITION AMERICA sets up such an unfailing standard.

Unless this standard is applied, nothing can save America from going the way of the Roman Empire which destroyed itself because of its iniquitous ECONOMIC IMBALANCE.


There are two fundamental economic principles, the POSITIVE and the NEGATIVE economic principles.


This is the principle of ECONOMIC BALANCE, BLESSINGS, PEACE PROSPERITY, HARMONY, LIBERTY, FREE ENTERPRISE, FULL EMPLOYMENT, and fulfillment of man's mission on Earth.

The RIGHT OF OWNERSHIP, in terms of Political Science, is called TITLE and can be obtained, scientifically and ethically, in the following three ways only:

  1. TITLE can be established by MAKING the object, creating an ORIGINAL TITLE.
  2. TITLE to the object can be established by GIFT, GRANT or INHERITANCE from the titleholder. This will be a TRANSFERRED TITLE.
  3. TITLE can be established by EXCHANGE between FREE MEN acting with COMMON CONSENT of objects to which each party, respectively, has an original or transferred title.

PROPERTY RIGHT according to the POSITIVE ECONOMIC PRINCIPLE is an UNIVERSAL PRINCIPLE which the Lord God himself honors in all His dealings with men. His commandment "Thou Shalt Not Steal" is predicated upon the principle of true property right, without which the commandment would be meaningless.

The NEGATIVE economic principle:




The NEGATIVE ECONOMIC PRINCIPLE is the principle of ECONOMIC IMBALANCE, which evokes confusion, poverty, unemployment, riots, wars, disease and wretchedness, and the CURSE of God.

PROPOSITION AMERICA proposes to RESTORE the POSITIVE ECONOMIC PRINCIPLE in all matters of economics, by causing the American People to abandon all acts governed by the Negative Economic Principle. In other words: STOP STEALING!

At first thought, that doesn't seem very far fetched. We don't steal!

What we meant to say was: STOP LEGAL STEALING!

At second thought, that's another matter.

Let us simplify the matter by stating the simple philosophy of TRUE CAPITALISM: PAY FOR WHAT YOU GET, AND GET WHAT YOU PAY FOR. That's all there is to it!

If we stick to that axiom we can put America on its feet again. And, honestly, does that sound too hard? Presumably not.


PRODUCTION of goods and services in abundance is what makes the American nation so wealthy. We possess all the FACTORS necessary for an even greater abundance of wealth. But we have LOST the ability to make full use of these economic factors.

The term WEALTH comprises CONSUMER GOODS and CAPITAL GOODS. Wealth is everything which is PRODUCED by LABOR and CAPITAL and which has an ECONOMIC VALUE. The term VALUE means DESIRABILITY and is measured by the amount of EXERTION which people are willing to give IN EXCHANGE for the object, in the MARKET PLACE. SERVICES can be defined as "Wealth instantly produced and consumed."

The Three Factors of Production


LAND is the scientific economic term for ALL NATURAL RESOURCES.

LABOR is the scientific economic term for PEOPLE who exert their ENERGY and TALENTS in any way whereby they produce goods or services of VALUE to mankind.

CAPITAL is the scientific economic term for that part of the nation's WEALTH which is set aside for the purpose of AIDING LABOR in the PRODUCTION OF MORE WEALTH. It includes wealth which is not yet in the hands of the consumers but is still in the process of EXCHANGE. Capital is, so to speak "Labor transformed into a more efficient form."

The Three Channels of Wealth Distribution

The PRODUCT is DISTRIBUTED by the means of EXCHANGE, to the OWNERS of Land, Labor and Capital, through three CHANNELS OF DISTRIBUTION: RENT, WAGES and INTEREST.

The owners of LAND receive RENT for the use of their land. RENT, properly called LAND RENT as distinct from rent of buildings and other man-made things, is the UNEARNED INCOME arising from land. "Unearned" because it arises either from the natural bounty of the land or from the LOCATION VALUE. In either case, land rent is that part of the product which exceeds the expenditure of wages and interest.

The workers, LABOR, receive WAGES for their efforts Wages are the EARNED INCOME or benefits arising from labor of any sort, mental or manual, whether paid in money or in any other form.

The owners of CAPITAL ("Capitalists" are workers who have stored up results of their labors for a more efficient use) receive INTEREST, which, in the true sense of the word, is a form of WAGES for their stored-up labor. True INTEREST is, therefore, an EARNED INCOME.


In spite of all scientific evidence, in spite of all scriptural evidence and in spite of logic and moral considerations, the "establishment", i.e. the powers ruling the world, has consistently disregarded the fact that natural resources, the economic factor number one, LAND, is NOT the property of men.


The POSITIVE ECONOMIC PRINCIPLE states that THE MAKER has the TITLE. The Lord made the earth, therefore He has the title to it. The Bible confirms this scientific fact:

"The earth is the LORD'S, and the fulness thereof, the world and they that dwell therein. For he hath founded it upon the seas, and established it upon the floods. " (Psalms 24:1-2)

The Bible also declares:

"The heaven, even the heavens, are the LORD'S: but the earth hath he given to the children of men. " (Psalms 115:16)

Does the Lord contradict himself when He claims title to something He has given away? Do the "children of men" actually own the earth now that He has given it to them? NO. what the Lord has given to the children of men is NOT the earth itself but the RIGHT TO EXIST on the earth and use its NATURAL RESOURCES, on certain CONDITIONS. He did not sell it to US, He LEASED it. Moreover, since the Lord is not a respector of persons, He did not grant any special favors to anybody.

Everybody has an EQUAL RIGHT to exist on this earth without having to pay another person for that privilege. That is the ESSENCE of the LAW OF LIBERTY. That is OUR GOD-GIVEN INHERITANCE.

Each of the Children of Israel who received the LAW OF LIBERTY was GRANTED a portion of the LAND as a LEASEHOLD, but this INHERITANCE was CONDITIONAL. They were to obey certain COMMANDMENTS, or else they would LOSE their INHERITANCE.


This is a clear statement that God is THE GREAT LANDLORD and that MAN is His TENANT.

As a TENANT, man is required to pay THE GREAT LANDLORD his RENT, in the Bible called TITHE because it is one-tenth of man's INCREASE derived from his LABOR on his INHERITANCE.

The Israelites paid the tithe to the Lord, and the Lord used the revenue to pay the WAGES of His servants, the priestly tribe of LEVI. To the Levites, the tithe constituted THEIR INHERITANCE, for they were NOT granted a landed inheritance such as the other tribes.



According to the COVENANT which the Israelites made with the Lord the tithe was clearly a contractual payment for benefits received. It was clearly a LAND RENT. The Israelites paid the Lord for two different kinds of BENEFITS. Life itself, and the God-given TALENTS bestowed on the individual was one of the benefits. The God-granted landed inheritance was the other benefit. We may refer to the tithe as "Soul-and Land RENT. "

Under the contract (covenant) which they made with the Lord, the Israelites could not sell their land forever (in perpetuity), for the land belongs to the Lord. But they could sell it as a SUB-LEASEHOLD for periods of up to fifty years at a time, after which the land would REVERT to the man whose INHERITANCE it was, free of charge, in the year of the JUBILEE.

The LEASEHOLDER would pay a LAND RENT, either as a lump sum once and for all or as an annual charge:


If an Israelite decided to become a merchant, sailor, carpenter or anything for which he did not need his acres, he could in this way LEASE his land to someone else and continue to receive the UN-EARNED, God-given income from his INALIENABLE INHERITANCE while devoting his time and energy to his trade. But he could not sell his land outright the way we do today, for that would DEPRIVE HIS CHILDREN of their inheritance when the money was gone. And nobody would have to make any DEBT in order to gain access to LAND. The land rent was paid out of CURRENT INCOME from the land. In contrast, the PRICE we pay for land today is the CAPITALIZED, FUTURE LAND RENT, and MORTGAGE DEBTS are putting not only ourselves but our posterity into economic SLAVERY.

The Israelites eventually lost their inheritance because they VIOLATED the LAW OF LIBERTY. They adopted the idolatrous ways of the false god BAAL and began to buy and sell land outright, ignoring the law of REDEMPTION commanded by the Lord:


Please read the entire chapters 25 and 26 to get the full scope of this tremendously important LAW OF LIBERTY.

We too are violating the Lord's commandment in thinking that we can own the land and that we can buy and sell for a PRICE like merchandise. Therefore, WE are NOT receiving the BLESSINGS which were PREDICATED upon keeping the Lord's commandments. Not that the Lord is arbitrarily punishing us in revenge; we bring upon ourselves the natural CONSEQUENCES of UPSETTING THE NATURAL ECONOMIC BALANCE when some of us get something for nothing while others get nothing for something. We are applying the NEGATIVE ECONOMIC PRINCIPLE to our dealings in LAND.


We cannot use the METHOD employed by the Israelites. We cannot distribute the land to everybody in equally valuable parcels, but we can do what is even better. We can distribute the LAND RENT, i.e. the unearned income from land, which arises partly from the God-given, inherent qualities of the land and partly from the benefits of a well organized society, benefits which create LOCATION VALUES.

Since the God-given, inherent qualities of the land are bestowed EQUALLY to all men, and since the location values are created by us all IN COMMON, the total land value, or ANNUAL LAND RENT, is clearly the COMMON PROPERTY of us all according to the POSITIVE ECONOMIC PRINCIPLE.

In keeping with the LAW OF LIBERTY, this common property should be collected by the COMMUNITY in the form of a GROUND DUTY and be distributed equally to all persons in the community where it is produced. Each person would in this way receive his God-given, un-earned income or INHERITANCE, exactly as each Israelite did when he leased his inheritance to someone else.


The community (city, county, state, nation) also has COMMON EXPENSES. The city and county provide streets, sewers, schools, police, fire protection etc. The state provides freeways, courts, universities, harbors, etc. The Federal Government provides defense, courts, foreign relations, national parks, etc.

As a matter of fact, the VALUE (desirability) of the land arises as a RESULT of all these beneficial PUBLIC WORKS, SERVICES and ACTIVITIES which serve to secure our possessions, enhance our economic possibilities and enrich our lives as workers, businessmen and residents. Also all the beneficial activities of the people in our various capacities contribute in a large measure to making the land valuable.

The commonly owned GROUND DUTY FUND collected from all us land holders according to the value of our land holdings is the natural fund from which ALL LEGITIMATE PUBLIC EXPENSES could be disbursed. Then only the SURPLUS of the people's equal inheritance would be distributed to the citizens.

The WELL MANAGED PUBLIC SECTOR, in cooperation with a well managed PRIVATE SECTOR, would greatly ENHANCE the property values and ENLARGE the GROUND DUTY, while simultaneously keeping the expenses down. The result would be a greater surplus which could be paid out as a DIVIDEND to the SHAREHOLDERS, that is, all the citizens of that community.

Liberation from taxation

With FULL GROUND DUTY in effect, this public revenue will be immensely large while simultaneously the cost of ADMINISTRATION will be immensely simplified. Therefore we can ABOLISH all taxes on the products of human labor: INCOME TAXES, SALES TAXES, PROPERTY TAXES ON BUILDINGS, etc.

The GROUND DUTY is NOT a tax but a duty.

Free public insurance

Besides taxes, also most INSURANCE PREMIUMS can be abolished. The Ground Duty Fund will pay the citizens a COMPENSATION for all DAMAGE from natural causes (fire, flood, earthquake, etc.), from acts of criminals and from any other calamity not due to any fault of the individual. There is NO PREMIUM to pay, for the GROUND DUTY is the premium.

Equalization of nominal losses

Of course, when the un-earned income from all land is collected by local governments from the owners of land the owners LOSE the WHOLE AMOUNT they have invested in land since the PRICE OF LAND is determined by the UN-EARNED PROFIT which the titleholders expect to derive from their land. The landholders are entitled to receive a COMPENSATION for their LOSS of FALSE CAPITAL.

PROPOSITION AMERICA provides for an EQUALIZATION of these nominal losses in such a way that NOBODY LOSES but all gain. See the chapter on Equalization.

To avoid misunderstanding, let us make it absolutely clear that you can BUY AND SELL PROPERTY exactly AS NOW. You take TITLE to land and improvements exactly as now, the only difference being that THE LAND COSTS YOU NOTHING, only the IMPROVEMENTS have to be paid for. But then you must pay the annual GROUND DUTY for the land while the buildings and improvements are TAX FREE.

You pay full Ground Duty whether the land is vacant or developed.


You pay the community for the value which the Lord and the community have bestowed upon the lot, and you pay the carpenters, electricians and other contractors for the beautiful house they build for you. If you leave the land vacant, the Lord and the community are bestowing the value on it IN VAIN unless you pay the Ground Duty, and till you do develop the land YOU are paying the Ground Duty IN VAIN and have NO PROFIT. Therefore, no valuable land will remain vacant or underdeveloped for long. All valuable land will be put to THE HIGHEST AND BEST USE, and the ensuing BUILDING BOOM will be limited only by the availability of workers and materials. No more UNEMPLOYMENT!

There will, of course, still be land which is not needed at present. Such land will become part of the PUBLIC DOMAIN which does not pay Ground Duty but which is reserved for the use of FUTURE GENERATIONS.

Remember, it is NOT YOU who pays the Ground Duty. THE LAND pays the Ground Duty if YOU make good use of it.


The LAND MONOPOLY is the fundamental EVIL which is running US down. We are all, more or less, either monopoly holders or victims of the monopoly powers. And let us make it perfectly clear that neither the monopoly holders nor the victims will like it when the madly escalating ECONOMIC IMBALANCE is driven to the point where the great majority of US must pay TWO THIRDS or THREE FOURTHS of our hard earned income just for the RIGHT TO EXIST (in rents, taxes, insurance premiums, etc.); when 99% of US are RENTERS and 1% of US are OWNERS. There will be RIOTS and CIVIL DISORDERS far beyond the chaos we already have (1982). Therefore, it is IN THE INTEREST of even the most affluent person that the LAND MONOPOLY be ELIMINATED.

THE CHOICE before US today is between NATIONAL SUICIDE and NATIONAL REVIVAL, and the latter alternative is possible only if we TURN AROUND and try to live by the economic laws of God.

ECONOMIC BALANCE or EQUITY is the NATURAL ORDER which will replace the economic imbalance or INIQUITY of the present if and when we begin to obey God's commandments and permit true economic science to be taught and to be acted upon politically.

Our economy can be likened to a huge PIE which is being divided into wedge-shaped pieces of various sizes. There are three main portions representing the three CHANNELS of WEALTH DISTRIBUTION: LAND RENT, WAGES and INTEREST. These three pieces are, in the illustration, separated by heavy lines. The dotted lines indicate "the way the pie is eaten. " The pie as a whole represents the TOTAL amount of WEALTH and SERVICES produced in America in one year, the GROSS NATIONAL PRODUCT (GNP). It is not a fixed quantity, and the size of each slice relative to the size of other slices is subject to VARIATIONS. It is important to visualize that, as the economy develops, the whole pie will usually grow bigger, and also that a proportional ENLARGEMENT of any one slice will cause a proportional DIMINISHING of other slices. Thus, if for instance the slice taken by TAXES grows disproportionately, the net revenue of Rent, Wages and Interest diminishes.

Please bear in mind that the relative sizes of the slices in the illustration in no way reflect statistical facts. It's the HOW and the WHY we are interested in, not statistics.

The PIE will be cut according to the POWERS which control the three economic factors, LAND, LABOR and CAPITAL. The more power, the bigger the slice.

The LAND RENT is that part of the PRODUCT which is left after payment of WAGES and INTEREST.

WAGES is that part of the product which is left after payment of the LAND RENT and INTEREST.

INTEREST is that part of the product which is left after payment of LAND RENT AND WAGES.

In other words, each of the three economic factors is exerting political and economic POWER to secure for itself a greater slice of the pie at the expense of the two others.

Unfortunately, due to the inherent ancient misconception of Property Rights, the cards are stacked in favor of the Land Monopoly. Labor and Capital must pay the Land Monopoly a rapidly increasing RANSOM for the RIGHT TO EXIST and can expand only with difficulty because little is left of their WAGES and INTEREST after paying these expenses. The expansion of Capital must be done with funds derived from the Land Monopoly, and the INTEREST RATES which Capital must pay are necessarily HIGH because otherwise the funds would be invested in LAND which yields a higher PROFIT than normally can be earned by investments in capital (buildings, machinery, etc.)

The Land Monopoly exerts its power by keeping large tracts of land VACANT or UNDERDEVELOPED, denying Labor and Capital access to the natural resources necessary for all productive activity. The landowners, as such, need only WAIT and nay the MINIMAL TAXES on the land, while Labor and Capital starve for lack of opportunities they can afford. Eventually, all land, all natural resources become capitalized at such high ransoms that Labor and Capital cannot function, and we have UNEMPLOYMENT, POVERTY, RECESSIONS and DEPRESSIONS.

Here in America there was plenty of land to share in the beginning. Therefore, the Land Monopoly had relatively little power, and the slice of the Pie going to Labor and Capital was relatively large compared to the Land Rent slice. The early settlers in America were people who had escaped from the oppression of the Land Monopoly in Europe. They found LIBERTY in America because they didn't have to pay other men for the right to live and work on the land. And Labor and Capital produced the world's greatest and richest nation. For a long time, the Land Monopoly had relatively little power because of the abundance of land, the Homesteading Law and the Property Tax which channelled part of the Land Rent away from the landlords and into the public treasuries where it belongs.

The PROPERTY TAX was originally a tax on LAND ONLY. Due to the general confusion about Property Right, the DISTINCTION between LAND and WEALTH became lost, and eventually the Property Tax was levied equally on both land and wealth. Land was taxed less and less and wealth was taxed more and more as INCOME TAXES, SALES TAXES and other taxes on the products of human efforts replaced the Property Tax. That development increased greatly the NET UN-EARNED PROFIT, the LAND RENT, and the Land Monopoly has now grown to the point where the portions left for WAGES and INTEREST are not just proportionally but ABSOLUTELY being DIMINISHED. That point is where the wholesome GROWTH of the whole PIE, the GNP, can no longer be sustained as more money is being UNPRODUCTIVELY invested in LAND and less money is being PRODUCTIVELY invested in LABOR and CAPITAL.

STOP AND THINK! Does a vacant lot on Wilshire Boulevard in Los Angeles become more productive because a man in New York invests ten million dollars in it? Is it not at least as productive if a Los Angeles firm takes it over for nothing, puts a skyscraper on it and starts paying Los Angeles City a million dollars a year in GROUND DUTY?

LABOR AND CAPITAL feel the pinch and try to fight back the best they can, but due to the confusion in economic theory, the power of the LABOR UNIONS and the powers of the CAPITAL OWNERS are aimed at the WRONG TARGETS. Instead of uniting their powers and fight the monopolies they fight EACH OTHER because they do not understand the fact that they are IN THE SAME BOAT!

STRIKES are directed at MANAGEMENT, and when the wage dispute is settled and higher wages are being paid to LABOR, no greater amount of WEALTH is being produced, but people have more MONEY to spend. That is a signal for the LANDLORDS to raise the RENT, and soon the Land Monopoly has eaten up the whole pay raise, necessitating another round of strikes. The LANDLORD is making LAND and BUILDINGS available for RENT, and the rent is raised when the SUPPLY of available land in that general location falls short of the DEMAND. Therefore, most of the INCREASE in rent translates into higher land PRICES.

The LAND-OWNER, as such, is completely PASSIVE and produces NOTHING. He may live in New York and own land in California, from which he draws his UN-EARNED INCOME. The people of California, with their industry and co-operation, have created the land value and the land rent and are therefore, according to the POSITIVE ECONOMIC PRINCIPLE, the TRUE OWNERS of the land rent, which they don't get. So they must pay income taxes, sales taxes, etc. to defray their public expenses, while the landowner can take his un-earned income, pay some income tax from it and INVEST the rest in more California land.

Our economy is becoming increasingly UNBALANCED because the LAND RENT does not flow to the rightful owner. According to the POSITIVE ECONOMIC PRINCIPLE, and according to the Lord's LAW OF LIBERTY, the land rent belongs to all the people in common, or equally to each and every person because land rent arises from, first, God's free and equal gift of natural resources; second, the marvelous co-operation of the people and the miraculous TECHNOLOGY, which make it possible for the ordinary citizen to live in greater comfort, security, health and luxury than any king in ages past. The technological SOCIETY or COMMUNITY provides streets, highways, railways, airports, police, fire-protection, courts, hospitals, churches, theatres, restaurants, shopping centers, water, electricity, gas, telephone, radio, television, libraries, parks, factories, schools, universities, amusement parks, museums, etc. GOOD BUSINESS and GOOD EMPLOYMENT OPPORTUNITIES come along with all these beneficial facilities and institutions. Whether they are publicly or privately financed they all together cause the DESIRABILITY, i.e. the VALUE of the land to rise. In truth, the community EARNED the land rent but is getting only a very small part thereof in the form of PROPERTY TAX ON LAND VALUES.

An uncalculable amount of money is WASTED because of our unbalanced economy, A huge BUREAUCRACY arises because of the need for an ARTIFICIAL BALANCING of the economy. A multitude of LAWS and REGULATIONS and EXECUTIVE ORDERS must be put into effect in order to help the individuals, the companies, the cities and even the poor FOREIGN COUNTRIES which all have become the victims of an unbalanced economy. And the TAXPAYERS must pay and pay till they run out of work and money. Then THEY become entitled to a HANDOUT.

But the WORST WASTE is the waste of HUMANS. Lack of FREEDOM to use the God-given OPPORTUNITIES causes waste of human intelligence and human aspirations, dreams and longings, the SPIRITUAL GIFTS of God which, if given a chance, would blossom and enrich our lives materially, culturally and spiritually.

Just think of all the mothers who must leave their children all day while they are working to supplement their husbands' income. Is there any doubt that children need their mothers, and that this condition is detrimental to Family Life?

The American Dream

Our great American free enterprise, "capitalistic" economy did not happen by accident. There were spiritual as well as material factors contributing to our success. The people who built up this great nation were possessed with a wholesome attitude, aptly described as "The American Ethic, "a blend of positive ideas both pragmatic and religious, characterized by a sense of fairness, tolerance, liberty and justice. As a result we became a classless society in which most inhabitants were, at the same time, LANDOWNERS, LABORERS and CAPITAL OWNERS, all three in one. In other words, most Americans possessed to some degree their God-given share of the natural resources, their INHERITANCE. And even if they were not owners of land they received much of their natural BLESSINGS anyway as long as land was abundantly available, RENT and PRICES were low, and WAGES were comparatively high. With this came the gift of independence, self-reliance, industriousness, generosity and PROSPERITY. There was, and still is, enough land for everybody to share. The abundance of cheap land spurred a rapid rate of growth. The political UNION and the absence of trade barriers between the states (Free Trade) created the most favorable climate for an unprecedented TECHNOLOGICAL DEVELOPMENT, with MASS PRODUCTION bringing the technical wonders to the people at prices which they could afford.


The American Dream was badly disturbed in the 1930's when the GREAT DEPRESSION hit the United States. The Land Monopoly and its offspring, the Money Monopoly, had created a state of economic imbalance which almost paralyzed the country. The Roosevelt Administration could have restored full employment, prosperity and peace in a very short time by applying the Positive Economic Principle. But instead of curing injustice with justice, Roosevelt's "New Deal" rescued the Money Monopoly and the Land Monopoly, which had just proven their perverse nature; established BIG BROTHER GOVERNMENT with its unmerciful TAX MONOPOLY, introduced SOCIALISM and the LABOR MONOPOLY and created the WELFARE STATE.

The "New Deal," which pretends that government can perform many tasks better than Free Enterprise can, was necessary because the Land Monopoly and the Money Monopoly made it impossible for Labor and Capital to function at full capacity and provide for the needs of ALL.

These un-natural, socialistic creations violate the God-given principle of Property Right just as badly as the Land Monopoly and the Money Monopoly do, but they serve to establish an ARTIFICIAL, though UNSTABLE ECONOMIC BALANCE, a balance which is continuously upset by the iniquitous POWERS operating within the system.

In fact, the "New Deal" served to magnify the powers of the Land Monopoly and the Money Monopoly by forcing the victims of the monopolies to share their means with each other, to the end that we may all be alive and able to pay rent and make loans at usurious interest rates. It goes without saying, that DEAD PEOPLE are of NO USE to the monopolies.

IN SPITE of the monopolies and the "New Deal" America proceeded victoriously and emerged from the Second World War stronger and more prosperous than ever. But we are not so sure about the THIRD WORLD WAR!

Now the "New Deal" has run its pernicious course and has served to elevate the Land Monopoly and the Money Monopoly to the point where the RANSOM we have to pay for the right to exist makes it IMPOSSIBLE for us to maintain PRODUCTIVE investment and employment. No matter WHAT the government tries to do, short of establishing Justice, will only make matters worse.

More and more Americans are now deprived of the chance to become owners of even a small lot with a house on it. All their income is spent on RENTS, LIVING EXPENSES, TAXES and INSURANCE. Nothing is left for the acquisition of either land or capital.

On the other hand, that portion of the population which holds LEGAL TITLE to land (the Land Monopoly) has an ever growing SURPLUS. This surplus is further enlarged when LAND VALUE TAXATION is being DIMINISHED as when California's Proposition 13 was passed in 1978. And when the INCOME TAX CUTS become effective in 1982, much of the tax savings will be invested in land, further stimulating the PRICES.

This UNPRODUCTIVE INVESTMENT in land, whether the land is vacant or developed, diminishes sharply the funds available for PRODUCTIVE investment. The much needed factories, homes and office buildings etc. remain unbuilt, and UNEMPLOYMENT gets worse.

If a FEDERAL SALES TAX, the so-called VALUE ADDED TAX (VAT) is instituted to replace income taxes lost, the brunt of the burden will be on the CONSUMER, further expanding the GAP between rich and poor.


Perhaps the ugliest but least noticed consequence of the Land Monopoly is ABSENTEE OWNERSHIP. Places which are abundantly bestowed with natural resources such as coal, oil, minerals, timber, fertile land, etc. , are often inhabited mostly by poor people who do not own much of the land, with poorly financed local governments and schools. Though they produce enormous amounts of wealth they receive no share of the bountiful land rent. ABSENTEE OWNERS siphon away the LAND RENT, while paying only a scant property tax and no income tax to the community where the land rent is produced.

The astronomical land values of New York City yield too little to the city government. The income tax on the unearned profits may be paid by the absentee owners, but not to New York City. The welfare load is huge, and that most wealthy city is BANKRUPT.

California's Imperial Valley is one of the country's most productive agricultural areas. Big absentee landowners carry the land rent away, and poor men do the labor.

Arab Oil Sheiks and Japanese Industrialists buy up large tracts of land in America. There is nothing to prevent them from carrying off the fruits of our God-given INHERITANCE, our common property, the land rent, which we as a community have EARNED.

Higher rents, lack of employment and rising poverty force millions of -Americans to become dependent on PUBLIC WELFARE. The government spends billions upon billions of taxpayers' money on aid to the poor but when the poor families get this extra money, UP GOES THE RENT. For the rent is determined by what the market will bear. In the end, the Land Monopoly soaks up all the "welfare" money, and the poor are no better off. Then, instead of a cry for justice, up goes a cry for RENT CONTROL. When rent control is in force, no new buildings will be built unless heavily subsidized by the government, and the existing apartment buildings will decay for lack of maintenance. Apartment owners are often hard put because of the high price they have paid and the high interest rate on mortgage loans.

The taxpayers are SUBSIDIZING the Land Monopoly in many other ways. Perhaps the most astounding feat of the Land Monopoly is the great success of REDEVELOPMENT AGENCIES. Private enterprise cannot eradicate slums and rebuild decaying cities because the low property taxes make it profitable for landlords to keep the land under-utilized while waiting for the BIG BIDDER. The Redevelopment Agencies are such big bidders. There was, for example, a triangular block about one and one-half acre in size adjacent to the freeway near this town. The owners were offered a total of $250,000 for it but would not sell. Then the Redevelopment Agency took action. The block was condemned and acquired by the RDA for $750,000 and resold to a hotel chain for $250,000, with a LOSS of half a million dollars, which loss is to be borne by the taxpayers. The "increment" in property tax revenues paid by the new hotel over the next forty or fifty years will pay off the bonds issued. The people got nothing but the land speculators have already received triple the market price. The value of the location, enhanced by the freeway, was created by the people in common, but it went into the wrong pockets.

In fact, all government activities which protect us, improve our lives and put money into our pockets have a highly stimulating effect on land prices. Also all activities of the people individually or in common which are beneficial to the communities serve to increase land values. SUPPOSE, for instance, that the Christian way of life became the only way of life, and that crimes, immorality, smoking and drinking, etc. were to cease. The BENEFICIAL EFFECTS on the community would be enormous. SAVINGS would increase and the effective DEMAND for land would increase, driving up the PRICES. The landowners would become richer still, and the poor would become poorer still as a result of this VERY DESIRABLE All-American Bliss.

Part 2