Earlier quoted context omitted.
Yes, that confusion is a decent enough explanation. The important thing I want to highlight, is that as factors of production go, increasing returns to land have different policy implications than increasing return to capital: A general wealth tax might be required if capital was actually the problem; with all the economic inefficiency that implies. I don't know for sure. But increasing returns to land have a simple…
I'm sold to Henry George's land value tax idea, if we were to create a nation. But we aren't. In our current situation, I would worry that taxing only the wealth "stored" in land ownership would create a massive economical crisis as capital tries to escape this new tax. A broader wealth tax base, with a slightly higher rate for land, is a more prudent approach.
And how is land supposed to flee? You can't take soil with you.
Wouldn't a broader wealth tax that applies to movable capital as well lead to that very moveable capital fleeing? (As an example, I am currently in the process of optimizing my own capital gains taxes, by eg choosing the country I hold my assets in carefully.)