Published in this week's Liberal Democrat News: a letter by ALTER Vice Chair John Pincham.

Owe the bank £100 and it's your problem, owe them £100 million and it's their problem. Add a few noughts and one has the developing relationship between the banks and the Treasury/us. Helping first time buyer? - yes to get deeply into debt.

Fail to lend the banks billions and they'll stop granting mortgages. House prices would fall, perhaps to 1997 pre-Labour government levels, and home owners would cease voting Labour.

With lower prices and owning second and third homes less financially attractive, more houses would be available and affordable by first time buyers whose lower mortgage needs might once again be financed by building societies from savings.

Keep up the letter writing - and let us know about your successes.

ALTER departed from its pet subject of Land Value Taxation to suggest an Emergency Motion for Liverpool Conference, which Vince Cable and the Lib Dem Treasury Team supported and adapted. It was debated for 20 minutes on Sunday 9th March and almost unanimously passed as new policy.

Christopher Glover, who helped draft the Motion and introduced it in a 4-minute speech - his first - to Conference, has experience of investigating accounts of major international banks and is an expert witness in banking fraud cases. Christopher admits that his main interest in ALTER is, like others, reform of taxation so as collect economic rent - but also like most ALTER members he recognises the close link between banking, imprudent lending based on inflated property values and the need for tax reform.

The wording of the Motion is below:-

SUSTAINABLE BANKING

Conference

5. To ensure that there is greater banking stability, using capital requirements as a tool to reflect the state of the economic cycle and therefore deter prevent large fluctuations in lending particularly in the housing market.

Vince Cable was the main speaker at ALTER Spring Conference Fringe, on the day he was made a Vice President of the group. We had asked him to talk not about LVT itself, but about a wider range of radical Liberal economic policies that link to LVT. The meeting was intended to ‘launch’ the ALTER project to mark the 1909 Peoples Budget centenary with a book of essays.
Alter Chair Cllr Tony Vickers chaired the meeting, introducing the speakers and asking ALTER Secretary Jock Coats to explain why we’re planning the book.
Vince Cable surprised us by immediately but firmly returning the focus to LVT, asking ALTER to continue its valued role by “challenging the Party to come up with practical policies on the subject”, translating ideas espoused by a wide and growing range of modern commentators, such as Sam Brittain and the Editor of the ‘Economist’. He remarked on the “extreme and growing inequalities of wealth” and stated that “it is widely understood that rent should be taxed”, citing the gift of carbon permits to large energy producing companies and utilities as examples of how not to deal with “natural opportunities to accrue wealth”.
“There is a dangerous illusion that private landed property can be treated like a bank”, he said. “We have to find ways to tackle our obsession with private property”. He concluded his speech to around 100 Lib Dem members by posing two questions that he wanted ALTER to answer:-
1. How can the Party take forward its commitment to LVT in ‘non threatening’ ways?
2. Do we leave the current property tax system alone and capture rent in other ways?
On behalf of the younger ALTER membership, former Federal Executive member and Lib Dem Voice figure James Graham responded from the platform. He said that currently the country was “going backwards on social mobility” and claimed this was largely due to the failure of Governments during recent decades to tax wealth acquired through property. “We need to deploy stronger moral arguments in support of LVT” but recognise that “inter-generational arguments can be divisive” and we should never forget there are asset-poor older people as well as asset-rich ones. “The division in society is not simply between old/rich and young/poor. We need to emphasise solidarity among all who rent.” Graham saved special disapproval for Inheritance Tax.
A lively discussion session followed. Gordon Williams wanted to know if LVT would capture the value which good schools added to their catchment area. Bernard Salmon wanted Vince to say if he supported the old Liberal policy of co-ownership – mutuality – but got a luke-warm response: “Workers today are not so comfortable with co-ownership. They’d rather not have their assets tied up in their employment.” However Vince didn’t dismiss the idea and pointed to the success of the rather complex John Lewis Partnership model.
Neil Upstone of Cambridge was another who supported mutuality – in his case, it was community land trusts that interested him. Jock Coats, Chair of Oxfordshire CLT, bemoaned the difficulty of acquiring land to put into such Trusts and felt they would help make land use more dynamic. He applauded Vince for keeping the pressure on his colleagues and ALTER to develop policies on land value capture.
Richard Gadsden of St Helens wanted to know if ALTER supported using auctions for landing slots and other natural monopoly opportunities. Vince said that even Richard Branson supported the idea. Certainly, said Vince, he wanted just this kind of fiscal measure to capture economic rent.
A young lady from Vince’s own Constituency in Twickenham made the perceptive point that people tend to become disengaged from the Welfare State through acquiring personal property wealth. This was the kind of question that ALTER wanted to explore but time ran out on the discussion and Tony finished by thanking Vince and announcing his (and Leader Nick Clegg's) appointments as Vice Presidents of ALTER .