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Does Georgism work? Is land a big deal?

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Re: Does Georgism work? Is land a big deal?

#21

Post by runnerup »

pasquinelli wrote: post #11
sokoloff wrote: post #2

I look forward to reading the second part, especially if it’s going to argue that tenants will somehow be able to use the land without paying the land rent. In any case, I believe a land value (or other property) tax would face significant (possibly insurmountable) Constitutional challenge to levy this federally in the US absent an amendment. https://constitutioncenter.org/interactive-constitution/inte...

Just make it a constitutional ammendment. I mean, obviously nothing of significance is going to change in terms of public policy, at all. This should be obvious after Obama->Trump->Biden, and covid, and on and on really. So, given that fact, it's a little funny to poo-poo a public policy thought experiment (which is all it is) on the grounds that the courts would strike it down-- as if any change of any significance…

Indeed! Thank you. Too many people don't see the constitution as the living document it was intended to be. It's so weird to me to keep hearing "that would be unconstitutional" as if it's some ultimate argument-ender for these thought experiments.

Also, in real life, I'd be happy to see a constitutional convention to resolve quite a few things - 2A, 4th amendment, abortions, 100-mile constitution-free-zone, etc. Seems like having a well-defined constitution that we can actually follow would be much better than our current situation where we largely seem to ignore the constitution text in favor of byzantine court precedence/interpretations.

I mean, on the face of it, people should see it's strange that alcohol prohibition required a constitutional amendment in 1920 but marijuana/drug prohibition in 1970 did not (Controlled Substances Act).

Re: Does Georgism work? Is land a big deal?

#22

Post by runnerup »

TulliusCicero wrote: post #17
runnerup wrote: post #16

The pro-Georgist essayist lists the three biggest challenges to Land-Value Tax as: > 1) Land might have been a big deal in 1879, but it just doesn't matter much today > 2) Landlords will just pass Land Value Tax (LVT) on to tenants, so it won't work > 3) In real life you can't accurately assess land value separately from improvements, so even if LVT would work in theory, it doesn't work in practice I personally under…

> In real life you can't accurately assess land value separately from improvements Hmm, is this true? It seems to me like the value of owning that 'space' wouldn't be that hard to evaluate separately from the stuff on it. When you say improvements here, do you mean improvements to land itself, like removing poison from the soil or reshaping it to be more flat, or 'improvements' meaning properties built on the land?

Generally improvements would mean "housing/commercial/industrial structures built on the land". The tricky part is that the land value can change quite a bit year-to-year, and the structures built on it can also both decrease or increase in value.

Re: Does Georgism work? Is land a big deal?

#23

Post by PragmaticPulp »

runnerup wrote: post #8
sokoloff wrote: post #2

I look forward to reading the second part, especially if it’s going to argue that tenants will somehow be able to use the land without paying the land rent. In any case, I believe a land value (or other property) tax would face significant (possibly insurmountable) Constitutional challenge to levy this federally in the US absent an amendment. https://constitutioncenter.org/interactive-constitution/inte...

> tenants will somehow be able to use the land without paying the land rent. I believe proponents of Georgist Land Taxes generally believe that rents are already as high as they can be. This seems reasonable for areas with housing shortage, as housing is a very inelastic commodity as far as commodities go. However, it might not be a good assumption for areas with a surplus of housing. I do know (multiple!) people who…

> Currently the property tax is offset by rising property prices and its not worth the hassle/risk to put tenants into the properties.

Depending on the local laws, leaving properties empty can actually be riskier than having them occupied. I had a friend struggle to evict squatters who moved into his rental property while it was vacant for a few weeks between tenants for upgrades. He lost months trying to get them evicted and they did a lot of damage to the house because they didn’t have anything to lose.

Houses are also tough assets to just sit on because they slowly decay over time and require periodic maintenance and updates, even if nobody is living there. An empty house can actually accumulate damage faster than an occupied house because nobody is there to notice leaks or other problems.

Leaving a property empty is definitely not a normal situation outside of maybe a few select markets with outlier (bubble) levels of appreciation and speculation. Building an entire tax system around this possibility doesn’t seem like a good idea.

Re: Does Georgism work? Is land a big deal?

#24

Post by tormeh »

kiba wrote: post #19
klipt wrote: post #3

Earlier quoted context omitted.

You'd really need to combine land tax with zoning reform to make it work properly. The idea is that since the land under a house and under a skyscraper is taxed the same, more valuable land (eg in city centers) would be built up, which means the tax per tenant could still be very low. Also you don't need to do it federally, states could do it fine too.

If we're talking about no political restriction, I would go even further. Get rid of the mass market cars and implement trams as the basic suburban and urban feature. It could even carry some light freight for last mile logistics. As for the rest, it's bicycles, even velomobiles.

Trams suck, IMO. The only good thing about them is they often get right of ways, which can also be given to busses. Subways are where it's at. Long trains that don't have to deal with traffic lights.

Re: Does Georgism work? Is land a big deal?

#26

Post by MisterMower »

“But won't landlords just raise the rent to make up for the LVT, passing the burden of the tax on to the tenants? Georgists say no, because land is special in that it is scarce and nobody can make any more of it. Indeed, LVT is a rare form of taxation that actually boosts the economy, because it discourages rent-seeking and speculation. Some Georgists even go so far as to say that LVT can raise enough revenue to replace all other less efficient taxes, becoming the so-called "Single Tax," but this is not a universally held position among modern Georgists. To be clear, proponents of the "Single Tax" believe that LVT is sufficient for all public purposes and that no other taxes (such as income tax, capital taxes, and tariffs) are necessary for revenue generation, although they still might support carbon taxes or "sin taxes" on things they want to discourage.”

Translation: Land is special, see? That means landlords will suddenly act irrationally and not pass costs onto their tenants, choosing instead to operate at a loss. And this method of taxation will somehow solve the housing crisis, because it will cause competition for scarce resources to suddenly stop. Some followers of these ideas imagine it being the only tax society could ever need! Except, you know, the ones that we want to keep so we can manipulate the dumber citizens into behaving the way we smarter citizens decide.

What a garbage philosophy. It takes a lot of education to step into bullshit this pungent.

Re: Does Georgism work? Is land a big deal?

#28

Post by slibhb »

I think the biggest problems with Georgism are 1. in some sense it calls for the expropriation of land by the government 2. it's unfair to change the rules in the middle of the game and 3. it's logistically difficult to carry out.

As far as unfairness goes, imagine a couple, 65, retired, paid off their mortgage, paid income taxes all their lives until retirement, now living off their savings. It's unfair to start taxing them based on the value of the land their home is built on, which they already paid for.

Re: Does Georgism work? Is land a big deal?

#29

Post by tormeh »

runnerup wrote: post #21
pasquinelli wrote: post #11

Earlier quoted context omitted.

Just make it a constitutional ammendment. I mean, obviously nothing of significance is going to change in terms of public policy, at all. This should be obvious after Obama->Trump->Biden, and covid, and on and on really. So, given that fact, it's a little funny to poo-poo a public policy thought experiment (which is all it is) on the grounds that the courts would strike it down-- as if any change of any significance…

Indeed! Thank you. Too many people don't see the constitution as the living document it was intended to be. It's so weird to me to keep hearing "that would be unconstitutional" as if it's some ultimate argument-ender for these thought experiments. Also, in real life, I'd be happy to see a constitutional convention to resolve quite a few things - 2A, 4th amendment, abortions, 100-mile constitution-free-zone, etc. Seem…

That's just how common law works. If you want to get rid of the power of precedent, it's not gonna really happen, but civil law would relax it a little bit, at least. Civil law is, in practice, also using precedent, but it's given way less weight

Re: Does Georgism work? Is land a big deal?

#30

Post by jolux »

MisterMower wrote: post #26

“But won't landlords just raise the rent to make up for the LVT, passing the burden of the tax on to the tenants? Georgists say no, because land is special in that it is scarce and nobody can make any more of it. Indeed, LVT is a rare form of taxation that actually boosts the economy, because it discourages rent-seeking and speculation. Some Georgists even go so far as to say that LVT can raise enough revenue to repl…

Well, charging an increase in rent without making an improvement would suggest that the value of the land has gone up, that increase would be taxed away, and so they wouldn’t be able to increase profit by raising rent. Of course, you do have to redistribute as well. It doesn’t help nearly as much just to tax.
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