Real and Personal Credit
For this last issue in 2015, with endemic property speculation again on the rise, we have chosen as our theme what one might call the recycling of real estate profits in favour of the arts. This is a topic that goes to the heart of associative economics – the problems that ensue when too much capital is credited into real estate, rather than being used up, spent away in ways that support the goods economy, with all that means for work opportunities and so on. But spent away, too, in ways that add to the quality of life, what economist, John Maynard Keynes, would have called carrying out ‘fine actions’, rather than disporting, or even losing, ourselves in leisure and entertainment.
The basic misdirection of capital into real estate leads to any number of secondary problems but here we focus on the possibility that, notwithstanding this error in our economic ways, can we even so, release some of that trapped capital to provide a basis after all for fostering the social and cultural aspects of life. Apart from individuals’ circumstances, these are the real casualties or victims of our error.
With its montage of recent references to real estate prices, Sign of Our Time confirms the thesis that the problem is known, but that little if anything has been done to remedy it, and that the error is now being reiterated.
The piece entitled Over-capitalised Land – The Creation of False Value by Rudolf Steiner is from his lectures in economics given in 1922. These lectures can be seen from many points of view and they deal with a huge range of topics. But their essential ground, when compared to the prevailing paradigm, is Steiner’s critique of not allowing capital to disappear into the creation of new values, but endeavouring to preserve it by over-capitalising real estate.
Then two examples are given from worlds seemingly far removed from one another, yet strangely united in their purpose. Habaguanex – Under the Nose of Communism reports on an important project in communist Cuba’s Havana. The Case of Folkestone – Arts-led Town Regeneration concerns the work of the Roger De Haan Charitable Trust in Folkestone, England, and is about capitalist philanthropy.
The AEX Page features two threads, the first looks at the Land and Capital Exchange, whilst the second contemplates the merits of regional or individual renewal.
Rounding off the issue, Accounting Background examines two differing approaches to the income and expenditure account, by nature and by function. Although the basis of the article was published in this journal 18 months ago, its theme remains of central importance, especially in light of the call for individuals to share their accounts, expressed in the exchange included in the page outlined above.