The Third Place: Abolition of Rents and Mortgages

Previously, I covered the concept of Intellectual Property as a pivotal example where there exists an intermediate between Productive and Personal Properties. To justify its existence in Production for Dasein, I adopted the Hegelian conception of Intellectual Property due to it being almost perfectly compatible with the rest of the Work-Standard. All that was needed on my part was to determine how it fits within the broader legal jurisprudence and who should be presiding over the regulation of all Legal Duties and Legal Rights pertaining to Intellectual Property. In the end, Office III of the Kontor, which concerns itself with Equipmentalities, was chosen as the one most suitable for tackling all matters related to Intellectual Property. In this Entry, I will expand upon the arguments introduced in the preceding one by addressing why the concepts of Rents and Mortgages do not exist and why the Totality must own its land on the basis of national sovereignty.

To begin, it is important to realize that all of the land in the Socialist Nation is owned by the Totality. The Totality owns the land through the Council State, which is tasked with looking after the land as part of its broader domestic policies. The State acts as the intermediate between the Totality and any Self interested in acquiring their own plot of land. There are three possibilities where the Self will be receiving the land and any buildings built atop it:

  1. The State may award the land and/or the buildings to the Self as part of their Vocation. The Self’s affiliated Guild covers all their room and board expenses.
  2. The State may award a deed of ownership to the Self as one of the aforementioned Prizes in the Social Ranking System. If the Self accepts the Prize, the land will become their Personal Property.   
  3. Alternatively, the State can facilitate the sale of the land to the Self. Once the Self buys the land, they receive the deed of ownership, and it will become their Personal Property.

What is happening in all three cases is in final analysis a transfer of Personal Property. The Totality is transferring something which belongs to them to the Self. It cannot be Productive Property because there is no Arbeit and Geld being created and there is just Actual Geld in a transactional sale. And even then, any accruing Actual Geld will only occur in the third option; this will be the case for the first or second options. Due to the characteristics of the Work-Standard, the concept of “real estate” has to be changed to reflect its conception of Property.

This also raises the question of what becomes of Rents and Mortgages for the “Reciprocal-Reserve Banking System,” the Work-Standard’s alternative to the Neoliberal “Fractional-Reserve Banking System.” Given the limited role of banking services, including the issuances of interest-loans called “Work-Tenures” (and eligibility is limited to one’s Social Rank) there will be neither Rents nor Mortgages in the purchasing of Personal Properties. Rents and Mortgages belong in the other two Modes of Production, Production for Profit and Production for Utility. In the former Mode of Production, both serve as extensions of Usury and Rent-Seeking, of trying to achieve Kapital Accumulation without generating any new Kapital. In the latter, their existence is scaled back to reduce the Quantity of Schuld to the so-called “renters” and “owners.”   

In Production for Dasein, because Kapital does not exist and the minimized presence of Schuld, Rents do not generate any Arbeit. The practice of charging Rent for Geld will be banned altogether. Conversely, Mortgages cease to exist as the Interest Rate gets replaced by the more appropriate “Mechanization Rate,” which controls the extent of Automation in the VCS Economy. Thus, all purchases of land will be a one-time purchase and the same is also true for other types of loans that exist in Production for Profit and Production for Utility. Either somebody has the Actual Geld to buy Personal Properties from the Totality or they do not have any to speak of.  

The elimination of Rents and Mortgages (as well as most other loans under the Fractional-Reserve Banking System) on Personal Properties does not signal the elimination of “Upkeep Costs.” Actual Geld is still needed for the maintenance of Personal Properties. For housing, as an obvious example of Personal Properties, that includes the mundane monthly payments for water, heating and air conditioning, and electricity. Somebody has to pay for those services, and that somebody is whoever owns the Personal Properties. Should the owner be the members of a Guild, to cite the first possibility, Self and their Comrades of the Guild are expected to pay the bills.   

Similarly, for Personal Properties controlled by the Totality, the Upkeep Costs are added to the “State Expenses” of the Council State, deducting any “State Revenues” to the “State Budget.” And as stated in The Work-Standard (2nd Ed.), if the State Expenses are higher than the State Revenues, “Sovereign Schuld” will begin to accumulate.  

Could a National-Socialized Bank (NSB) or a State Bank lend a Work-Tenure to a Borrower who is seeking to purchase Personal Property from the Totality? The characteristics of the Work-Tenure, as a National-Socialized Financial Instrument (NSFI), has the Lender and the Borrower contributing their two halves of Arbeit and two halves of Geld, and the Borrower paying the Service Fee. This fact alone limits the issuance of Work-Tenures under the Reciprocal-Reserve Banking System because the Lender is expecting the Borrower to convert their Personal Property into a Productive Property. It is possible for Personal Properties to be converted into Productive Properties and vice versa. If the Lender cannot achieve that conversion, then they cannot be expected to pay their half of the Work-Tenure. Therefore, in addition to Borrowers having to meet the perquisite Social Rank, the Lenders will be limited further to those who can.    

Categories: Third Place

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