photo credit: M0les

Renegade Economists podcast

Joel Simo from the Melanesian Land Defence Group visited Australia recently via an Aid Watch.

Listen to his interview on the Renegades here…

In discussion with Green Left Weekly Joel says:

Customary land title represents the majority of land tenure in Fiji and Vanuatu and provides locals with food security.

This security provides certainty in times of economic downturn. MILDA argues that during the global financial crisis of 2009, very few people in these communities went without food or housing because of their access to traditional land.

Sukot told GLW: “During the economic crisis, it was very difficult for people in the cash economy. In the traditional economy, everything is very much dependent on land.

“People are able to provide basics for themselves even in economic crisis. The traditional economy is about sharing. This is different to the economy in the US, where the economy is based on selling.

Music

The Shepherd Island dancers were recorded at the 2008 Shepherd Alliance Party’s National Congress.

Read this innovative Helo Magazine interview. As a crisis journalism magazine, we were interviewed via a skype roundtable chat session:

Part of the intro states:

Can Pacific peoples bridge the world’s chasm between understanding cause and effect of climate change as well as coconut colonialism? Paradise, blue water, blue skies, abundant marine life, smiling faces, bible harmonies, simple lives, and resorts for cashed-up suburbanites. Or abject poverty, menacing kava stares, razor wire, machete-wielding youth, laplap dictatorships, tribal violence and raskol gangs running amok.

We jump into the interview:

Karl: My answer is to use the language of the corridors of power to fight back:  Use economic lingo to protect the earth, the community. Also, foreign aid has to be carefully looked at. Throughout Melanesia, aid has built ring roads around islands and new wharfs so the Multi-National Corporation’s (MNC’s) can rip out the resources quickly. Thirteen such projects by the Millennium Development Corp in Vanuatu. [For example] the ring road is almost finished on the main island of Efate.

Daniel J Gerstle, HELO Editor:  Forgive me, but given that foreign aid development may need to be done with more fairness, particularly in terms of MNC, does it really follow that you consider those ring roads and development unhelpful to the indigenous people in other ways, in terms of infrastructure, healthcare logistics, and markets?

Karl: More resource-based greed is showing through in the carbon cowboys scouring Papua New Guinea (PNG), and I bet other Pacifica islands. Check the comments re: Kirk Roberts.

The roads do improve life in the short run—less dust for local communities, quicker travel times – are dwarfed by the motivations these improved services provide to land sharks. Land becomes hugely valuable when you can fly into an airstrip in the north of Efate, one of the 13 infrastructure projects being built in Vanuatu, and zip off to the coastal mansion you have. All with little interaction with the locals, missing the urban drift in Vila. When this happens the local fisheries are fenced off by these essentially gated communities and the locals can no longer live off the land.

They have to head into town to work for the man. This form of dispossession has racked all developing countries where land scarcity delivers more workers to the smokestack MNC’s, and thus cheap labour. Check out the land speculators paradise: They have the cheek to call it barrier beach! To turn it into a marketing ploy when the locals can’t fish there no more!!! This site is in Santo, the 2nd biggest island in Vanuatu. 

Elite property investors are attracted to this slick site. Check it out and invest with a click of a button, with no thought of the impact on the local community. The Washington consensus has been aiming for this, for the flexibility of capital to swoop into a country and buy up a prime location, sell it a year later to make a killing. This is happening to all of the world’s most beautiful areas, particularly those like in the pacific where private land title is barely thirty years old.

Read more at HELO

Last night’s 7.30 Report saw the long awaited report on Vanuatu’s freedom being curtailed by foreign investors. The high rents are hurting, as is the understanding of the lost opportunities when millions in profits are being siphoned out of the country by the real estate industry . This industry is largely dominated by expat aussies ‘making a new start’. A good story well told by reporter Kerri Ritchie.

Read the transcript or download the video here.

We hope this motivates you to attend our talk next week on Vanuatu’s Sovereignty Surrendered.

Karl Fitzgerald

As published in the Mar – April Progress magazine. Get a copy of this cane paper, veggie ink mag sent to you for 6 free editions
Related Event – Thurs April 30th – Vanuatu’s Sovereignty Surrendered
The World’s Happiest People

A 2006 study by the New Economics Foundation and Friends of the Earth found that Vanuatu was the world’s happiest nation. The study looked at consumption levels, life expectancy and happiness.

Our recent visit there proved otherwise.

Walking down the main street of Port Villa at sunset and one could feel the glaring eyes of the youth looking at the food in my hands. A riot had occurred in May. In early November, a week before we arrived, a tourist operator was bashed at the local port by a local taxi driver. Frustration boiled over because of the cartel-like control of new visitors by the expat dominated tourist industry.

With urban drift a rising phenomenon in rapidly westernising Pacific nations, the city had an edgy feel .

Something was amiss in the world’s happiest nation.

Within minutes of arriving, the eyes of a roaming renegade economist could soon see traits similar to western societies. Vacant land littered the community. Forests were being cut down on the urban fringe, rivers and streams polluted by the run off. These were effects, but what was the cause?

Vanuatu is a relatively young country, having gained its independence just 29 years ago from the French and English.

The tragedy of this opportunity is that just 29 years since independence, 90% of Vanuatu’s coastline has been sold off. Over 80% of the capital city Villa is foreign owned. Small, locally owned business is a rarity, with just 2 ni-Van owned operations located whilst we were there.

Vanuatu’s background is radical for the region. Walter Lini was their first Prime Minister (1980 – 91). He developed Melanesian socialism. Wikipedia tells us “’Giving’ was based on one’s ability to do so. ‘Receiving’ was based on one’s need”.

Lini also signed the Non-Alignment Movement. Whilst maintaining his independence, he forged closer ties with Libya and Cuba than the US. This concerned America as Vanuatu was the only Pacific country not to have signed with the pro-Western bloc. Lini ‘s administration was staunchly against nuclear testing in the region. He was also a proponent of a new Melanesia where the people of East Timor and West Papua were freed.

Many ni-Van’s (indigenous) etch together a living driving taxi’s. Most locals work for expat Aussies or Chinese. With Vanuatu a prominent tax haven, some of the shadier western businessmen have descended on this idyllic life to ‘start again’. It’s not hard to find web comments on how ni-Van’s are treated as little kids by these westerners with superior english.

Rayna and I were invited there to speak to the Shepherd Alliance Party, a rapidly growing political party in the volatile world of Vanuatuan politics. In what turned out to be a 4 hour presentation, I ran through the need for the people to gain a share in the bounty of the land.

Having a cultural connection to land, the many chiefs in the audience resonated with this need. We moved through how social progress and population growth naturally added to land values. One of the many Karl’s we met there summed this up as ‘magic money’. How true. ‘We must turn off the tap to the magic money of land speculation’ became the catch-cry.

Over the last twenty years much of the Pacific has moved from kastomary land title to Torrens Title. Going from a socially based form of land ownership to one where property developers are carving up their idyllic coastline with names like Barrier Beach, it was like a step back in time for a Georgist. Here we were rubbing shoulders with politically minded people in an era where their commons were being enclosed day by day.

The people are alive with the inherent understanding of the vitality of land and all the freedom it represents. In what seemed to be a light bulb type moment for the audience, the chiefs were excited by the explanation that land earns a natural bounty to be shared amongst the community in place of all other taxes. Chairman Morris Kaloran summed the essence of this up with ‘No matter what factory they have, they cant make dirt’.

Soon the chiefs passed a resolution to include Land Tax in the party’s constitution.

As with Melbourne’s ‘World’s Most Liveable’ city tagline, the ‘World’s Happiest’ tag was adopted and sculpted by those that owned the most precious resource of all – Vanuatu’s land.

Ironically, the World’s Happiness measure was meant to raise awareness that excessive consumption doesn’t deliver happiness. However, with our two dimensional economic system any such headlines can be marketed to the advantage of those same over-consumers, the wealthiest people on the planet.

Vanuatu’s main newspaper, the Daily Post (19/08/08) reported how chief Mack Paiiamaja from South Santo expressed serious concerns regarding massive uncontrolled land speculation and sub division development.

“Many of these developments have contributed significantly to creating divisions within the communities of rural Santo as a result of land disputes being generated to claim ownership.”

Meetings with senior bureaucrats revealed shocking details. Land valuations hadn’t been performed since independence in some areas. The tourist brochures reminded us that Vanuatu means ‘Land Eternal’. Surely it is valuable then?

In Port Villa it has been over 10 years since land valuations, meaning that the contributions land owners are making to the public purse via land tax are very small.

Compounding the problem, the Land Valuers office is tragically under resourced, with administration soaking up any time to value land. Four work in valuation at the Lands Department. Two people work at the Valuer Generals office. Discussions revealed that valuation skills desperately needed updating.

The Land Tribunal had thousands of disputes but only 2 people. The Lands Department was even shutting services, such was the ineffectiveness of public policy.

The plot thickened when we heard that Land Taxes had mysteriously been reduced from the 2- 3% listed online to 0.83% on pre-historic land values! An administrative decision, rather that a government decree, had led to this secretly sliding through.

A host of differential rates of Land Taxes ensure the system is confusing and open to debate. No wonder so much time is spent in administration.

Every time we mentioned to taxi drivers or people we met at the Fest Namaba1 that the land bounty must be shared with the people, there was resounding agreement. It was widely recognised that speculators were doing more harm than good.

So what was the cause to more than 25% of the population living below the poverty line?

Tax policy has been massaged by vested interests so that the direct and costly administrative control of an island nation has been replaced by the invisible chains of land speculation, forcing up rents to astronomical levels. Heads nodded in agreement when we asked whether the many living in central Villa, the educated workers of government, were paying 50% of their money in rents.

One wonders how they received such poor tax advice. Some suggest that land policy was developed pre-independence and has not been reviewed since. With the rapid increase in land privatisation, land use policy seems well overdue for a revamp. An ad hoc process is holding the good people of Vanuatu to ransom.

The easy profits being made in land speculation are tearing up the Pacific Islands. Whilst one can point to religious and racial tension as triggers, one feels that with more investigation of the Soloman and Fiji riots that these were borne of frustration at the radical change in lifestyles thrust upon them by the ‘benefits’ of westernising land title and privatising land rents. One hopes this doesn’t occur in Vanuatu, but with large numbers of unemployed young men in a town witnessing rich white folk driving around town in new hummers (!), the social contract is rapidly melting.

We have a unique opportunity to assist in finding a balance between western and kastomery land title.

What one can experience when visiting HYPERLINK “http://www.barrierbeach.com.au/”www.barrierbeach.com.au is the internationalisation of what was once a sacred resource. The land itself is now being sold off to the highest bidder in a global fire-sale. Local ni-Van’s have no chance of owning a piece of their traditional lands and taking a respectable place in their precious society.

Instead, some of the world’s most beautiful coastline is being sold off to an international coterie of property speculators who know that given enough time, they can sit back and buy and sell exotic locations for massive profits with just a few clicks of a mouse.

Morris Kaloran recounted how ‘In the 90′s there was barely a real estate agent in town. Now there are dozens of them, all making a killing’.

But the tax advice is where the real game of opportunity lies. Which foreign entities have advised the Port of Villa Municipality to charge council rates on buildings only? We are pursuing the answers through the questioning of the Senate Estimate’s committee.

No land is in the tax mix for council rates. This is precisely the reverse of what should be occurring for an effective council rating system. Meetings with senior bureaucrats revealed that many colonial landlords were given exemptions from even these miniscule council rates at the time of independence.

With all this controversy, we had to drive around the island of Effate to survey the lay of the land.

Colonialists used guns to gain access to land. Neo-Colonialists use a potent mix of land speculation, corruption and the promulgation of ineffective economic policy to massage their self interests. Nowhere is this more prominent than the lands of Roi Mata.

Roi Mata was the grandfather of Effate, the main island of Vanuatu, renowned for crystallising peace amongst the tribes. His ancestral lands at Mangaliliu were announced on July 8th, 2008 as Vanuatu’s first World Heritage Site. With signage at the front gate stating that this was proposed World Heritage land, Queensland developers somehow connived their way into clear-felling the forest and offering nine hectares up for sale. This clear-felling happened within one month of the World Heritage announcement. The buffer zone they are operating in came with a set of leasing rules that have been drastically overstepped.

Local chief Reuben Kaloris and William Kalotiti have blockaded the main access road out of concern for what is happening to this sacred land. With legal threats being thrown at the chiefs and local supporters (who are also scared that their house will be burnt down), we hope this story will reach mainstream press by the time you read this.

This clear-felling is happening for a paltry amount. Locals were told that the land would be sold for 4million Vatu (A$55,000) However, the prime beach front site was advertised at 30m Vatu (A$415,000) and is now sold. The remaining 9 sites at advertised prices will reap just $900,000. Trashing a World Heritage site must be worth barely more than a million bucks!

With the GFC accelerating bankruptcies daily, it seems like much of this pristine coastline will sit vacant waiting for the next land boom to take off. As analysts of the land market will understand, these sites will be drip fed to the market over the next 15 years, with at least one guaranteed to go for $1m. More pollution and disturbance will be about all the local community receives in return.

Of added attraction to salivating profiteers is the fact that Mangaliliu is the entrance point to the island that Survivor: Vanuatu was filmed on. Perhaps the potential of exotic marketing slogans highlighting the World Heritage status and views of ‘Survivor’ Island motivated the developers to ruthlessly cut corners. Those taglines, when combined with its intrinsic beauty, would ensure a sizeable price tag well beyond what the local bloodlines would receive in a one-off payment for this sacred land.

Please watch our short film on this outrageous controversy via www.youtube.com/earthsharing

As a demonstration of the difficulty good governance faces in the country, Transparency International, the peak NGO body fighting the ills of corruption worldwide, is represented by a real estate agent in Vanuatu.

A developer with a 2 page criminal record was recently awarded Vanuatu’s highest honour. He has the privilege of enclosing the closest, most beautiful beach to Villa.

Taken from the Vanuatu Investment Promotion Authority website, this developer says:

“To Whom it May Concern

If you are reading this letter than you have made the first step in the right direction.

To invest in the Vanuatu Islands is the smartest move I have ever made, and will be yours also.

I arrived here Independence day 2001, just divorced ravaged by tax and lawyers, not knowing where or in what I wanted for my future life.

Alone and lost I immediately felt the warmth of the people, Ni van’s and expats all welcomed me…

On the second day I started real estate hunting, I knew this was my future home, I was fortunate enough to see a double wave break on a white sandy beach not 10 minutes from town. I could not believe I could buy 1 acre on that beach, but I could, the land ownership over here is same as Canberra.”

One can be assured that the friendliness is waning today. Australians have a bad name due to the corners they cut chasing the ‘investment dream’. Another development on Mele beach sees sites up for sale on former swamp land, with the environmental destruction prevalent in clearing the site said to be positive for the community because of the removal of conditions conducive to mosquitoes and their malaria.

As we continued our drive around the island we began to see the impact of the ring road that US Aid was building. Perhaps solidifying the warmth in relations as Vanuatu’s politicians were brought back in line with Western interests, the Millennium Challenge Corporation has signed a five-year, $65.69 million Compact with the Government of Vanuatu.

This aid will deliver eleven infrastructure projects. Pro-aid websites valiantly tell us this will benefit poor, rural agricultural producers by reducing transportation costs.

It is also meant to increase average wages per capita by 15% within 5 years.

This analysis fails to register that western property developers have crept around the island buying up vast tracts of virgin land. We saw land banks for sale every 8 – 10 km’s. With a new airstrip and a sealed road, wealthy westerners can fly in, scoot off to their beach villa and hardly see the depths of poverty in Port Villa.

A new slogan was borne: ‘Foreign aid for foreign speculators’.

Our second stop saw a visit to Chief Andrew Popovi from Tanoliu. His concern centred around speculation and how little land his people had left. Chief Popovi was one of the few to know that a 10% fee was to be paid to the traditional owners when re-selling the land as a subdivision. This amount was often a lot lower than when sold a third time, hinting that perhaps third party companies were utilised to ensure that the flipping profits stayed within the walls of the wealthy.

The chief was concerned that many of the reform measures decided upon at the 2006 Land Summit had not yet been implemented. Land sale contracts are still written primarily in English, rather than including the local Bislama language.

Driving onwards through this largely unsigned country we were desperate for a lunch stop. We had noticed that Beachcomber Lodge had hot spas, the only location on the island with this natural wonder. Upon entering the site, we drove straight to the nearest spot on the beach for a quick bite before heading over to the springs.

A few bites into lunch and this loud voice boomed out from right next to us, scaring the living daylights out of us all. Before we could comprehend how this self-professed land-lord had crept up and yelled at the top of his lungs, he was preaching to us ‘How dare you enter my land, driving all over it. Who do you think you are? Where do people like you come from?’

We were rattled and couldn’t even get in a good comeback line! Where were the cameras to catch this landlord’s insecurity on film? Where were our moral rights to a seat on what is meant to be a public beach overlooking the Shepherd Islands, the traditional lands of our navigators Julie and Rivkin?

With tensions rising amongst the community about access rights to beaches and food sources, the school principal type demeanour this Aussie expat displayed was a shameful reflection of private property rights walloping human rights. I still have moments of anger flash in frustration at my inability to awaken this poor chap’s conscience. One can only imagine how he treats his indigenous ‘subjects’.

If I was on my front foot I would have inquired about ‘his’ enclosures. Are the natural springs he enclosed valued at a respectable level? Is the rate paid respective of the right to privatise what once would have been a public meeting place?

We dwelled on these thoughts as we dodged pot holes, gliding through some of the most beautiful lands one could imagine. Soon we arrived at Eton Beach, the only national park we saw, where we gladly paid a 300 Vatu entry fee to the government.

We left Vanuatu shocked at the effect land speculation was having. Adding to the dilemma was that western aid funded scores of young white uni graduates to a loud, beer fuelled aussie existence. Canadian aid workers were wary of us. Western aid promoted a reliance model of handouts rather than self-help.

Let’s do something about this.

With the positive resonance experienced in discussions with bureaucrats, we are making the most of Alanna Hartzok’s Global Land Tools online course as the perfect resource for long distance learning. Within the course we have set up an EarthSharing Pacific class where participants are submitting details on land policy vagaries in their country.

Take it further by joining the class – http://course.earthrights.net/

photo credit: robertpaulyoung

There is little doubt that Zimbabwean-like land grabs will occur on our doorstep if current economic policy continues. The policy alternative we spell out below could pop the fuse to the frustration that led to Zimbabwean land grabs and the simmering tensions in Fiji.

With the Pacific Islands rapidly privatising from kastomeray land title in the last decade or so, the growing pains of adjusting to the outright ownership of natural resources is continually rearing it’s head. We have written about Vanuatu before and hold great fears for countries such as Papau New Guinea, West Papau and small island nations like Maluku. Why? Because there is something intrinsically wrong with the current notion of ‘private property rights’.

Read this story on death and destruction in PNG over a gold producing piece of land in Morobe Province near the controversial Hidden Valley goldmine:

The newspaper, The National, reports that fighting erupted when a land dispute over ownership of the McAdam National Park between Wau and Bulolo came to a head as Watut tribesmen gathered in Wau in their hundreds and staged an early morning attack on the villages of Biangai tribe.

The violence left three people dead, several injured, houses and property destroyed, and forced the temporary shutdown of the Hidden Valley gold mine and the evacuation of employees.

A Watut man was allegedly killed recently by Biangais over a gold-bearing piece of land on the national park, which is said to have sparked the tension.

How can one man be said to ‘own’ a piece of land, especially one that has gold underneath it? Did he create this gold? Did he do anything to produce it? No. Now how does this sit with indigenous culture that sees the creator spirit as having gifted the gold to all living beings past, present and future? If the creator gave gold and all other natural resources as a gift, why should white man come along with a black and white ruling to determine that private property is a god given right?

Is private property a god given right?

White man’s understanding of private property once knew of the need for a distinction. Unfortunately it’s been largely forgotten. The Lockean principle that founded private property rights stated that we all deserve to keep the fruits of our labour. The fruits of the earth, however, were to be shared amongst all and weren’t to be sold (Leveticus 25:23).

How do we process this distinction in the modern era?

As natural resources gain in value due to scarcity rather than hard work, the upkick in value should be shared amongst the community. This is where a Resource Rentals system comes into play. Natural resources such as gold come from land. Effective yearly land valuations would reflect the changing value of gold. The Site Rental on the land would be paid to a transparent government, where such monies would go towards the running of the country. In this way all tribes get some share of the money, as does the private company mining the gold. Sovereignty is maintained. Reward for effort is encouraged. Everyone benefits.

The resource curse is a fallacy pushed by the academic elite in support of the silent theft of millions by vested interests involved in ‘the land game’.

Indigenous cultures are seeing the worst of economic behaviour in a minute period of time. Western culture had 200+ years to adapt to the speculative mindset that dominates finance today. How would one feel in a country where your traditional cultural upbringing raises questions about the millions resource flippers make buying and selling? Then to see the house of cards come crashing down with the GFC, even the most educated westerners are questioning modern economics AKA speculative economics. Is an economic policy alternative being presented? Or are frustrated regimes left with the slash and burn policies of Mugabe?

How long will Boplivia’s Morales last with such land grabs?

Consider what the chiefs in Morobe province have heard about the tax benefits Freeport mine receives, for example:

As a complex set of limited partnerships, many of Freeport’s operations enjoy tax-free status under the 1987 Internal Revenue Code (Section 7704) exemption for partnerships that derive 90 percent or more of their gross income from natural resources. Its 1993 Annual Report (p. 1, 34 and 46) shows sales of more than $1.5 billion and yet in 1991, Freeport gained a federal tax BENEFIT (not a payment) of $28 million; in 1992, a tax benefit of $25 million; in 1993, it received more than $2 million in federal tax benefits.

It seems the entire Pacific has been given a bum steer when it comes to tax policy. Natural resources to receive an exemption from tax? Ahh that’s right, capitalists already own the earth!

Mining companies should be paying an environmental bond reflective of the immense value of eco-systems surrounding their projects (ie a bond in the millions) to ensure that they do the right thing by the local community. Acid-bleach mining may not be such a priority under such a move.

This bond plus a Resource Rentals system would go some way towards bringing harmony between the community and the miners.

Read Alanna Hartzok’s The Earth Belongs To Everybody to understand how the above can occur.

Following our recent visit to Vanuatu, a colleague put this together, reflecting the heartfelt concern ni-Van’s have for their rapidly dwindling land ownership. Just 29 years since independence, only 11% of land in Villa is locally owned.

As Morris Kaloran states: “No matter what factory they use, they cant make any more dirt.”

We will be announcing a number of initiatives to assist this movement during the course of this year