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Book Review: Progress and Poverty

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Re: Book Review: Progress and Poverty

#71

Post by prichino »

AnimalMuppet wrote: post #66
zozbot234 wrote: post #35

Earlier quoted context omitted.

Since all taxes are ultimately borne by land (specifically, by resources in fixed supply), it's not at all clear that compensation is required for a neutral tax shift.

> Since all taxes are ultimately borne by land ... Objection, your honor. Assumes facts not in evidence. How is income tax ultimately borne by land? Sales tax? Inheritance tax? Gasoline tax? Corporate income tax on corporations like SpaceX, Goldman Sachs, and Intel? "Ultimately borne by land" may have made sense a century or three ago, when (almost) all income ultimately came from the land. That's not the world we li…

The username checks out; where do you think wealth comes from if not land? Paper money in the end is just a representation of claims for assets generated from land. Food, minerals, energy, actual things all come from land.

You cannot eat a metaverse.

Re: Book Review: Progress and Poverty

#72

Post by prichino »

TimPC wrote: post #38
zozbot234 wrote: post #35

Earlier quoted context omitted.

Since all taxes are ultimately borne by land (specifically, by resources in fixed supply), it's not at all clear that compensation is required for a neutral tax shift.

Some people argue no compensation is required but I think in reality an LVT at 100% reduces the price of all land to $0. Given that land is substantial portion of retirement savings in our current economy, completely obliterating land prices without any compensation seems morally dubious. Perhaps if you do it slowly enough that you give everyone time to adjust and make the market adjustments gradual enough that peopl…

That's the gist of it. If land is so worthless even rich people don't want anything to do with it, why would it make someone poor better off to have it?

Re: Book Review: Progress and Poverty

#73

Post by AnimalMuppet »

prichino wrote: post #71
AnimalMuppet wrote: post #66

Earlier quoted context omitted.

> Since all taxes are ultimately borne by land ... Objection, your honor. Assumes facts not in evidence. How is income tax ultimately borne by land? Sales tax? Inheritance tax? Gasoline tax? Corporate income tax on corporations like SpaceX, Goldman Sachs, and Intel? "Ultimately borne by land" may have made sense a century or three ago, when (almost) all income ultimately came from the land. That's not the world we li…

The username checks out; where do you think wealth comes from if not land? Paper money in the end is just a representation of claims for assets generated from land. Food, minerals, energy, actual things all come from land. You cannot eat a metaverse.

> The username checks out; where do you think wealth comes from if not land?

I gave several examples of wealth that doesn't come from land. I asked for an explanation of how, in those examples, wealth came from land. You reply with an insult to my chosen username. That's... not a very good argument.

> Paper money in the end is just a representation of claims for assets generated from land.

Here you're using the assumption that all wealth comes from land (the exact assumption I was questioning) in your argument. That's circular, and therefore flawed. You can't assume X and use that in your proof of X.

> Food, minerals, energy, actual things all come from land.

The silicon that goes into Intel chips comes from land. The chips themselves? Not so much.

The single biggest factor in Google's prosperity is the google.com domain name. How big a real estate footprint does that have?

I hear that Taylor Swift has a pretty big income. How much of her income is based off of land? It's derived from a musical imagination.

> You cannot eat a metaverse.

This I will grant you. All food (currently) is derived from land. There's a lot more to wealth than food, though.

Re: Book Review: Progress and Poverty

#74

Post by gruez »

SilasX wrote: post #47
aesh2Xa1 wrote: post #11

Earlier quoted context omitted.

I have wondered this, too. "Is/was Georgism really so popular?" Do you have any papers/writing which specifically criticise Georgism?

Paul Birch had a long essay criticizing it. Here’s where I mentioned it on HN to summarize the key points: https://news.ycombinator.com/item?id=17605751

I'm actually doubtful this would end up being cheaper. Sure, such a building would only pay taxes equivalent to a suburban house, but the construction/maintenance cost of a 2000m building (the tallest building in the world is only 828m) would be insane and would obliterate any tax savings.

Re: Book Review: Progress and Poverty

#75

Post by dionidium »

bee_rider wrote: post #8
scythe wrote: post #6

Earlier quoted context omitted.

The biggest problem with LVT is surprisingly simple: accurately assessing the value of land is very hard, and ensuring that the assessment process is fair is therefore extremely hard. LVT experiments in history tend to run into problems when people feel that their land has been valued incorrectly, leading to a vocal minority that despises the law. That results in something like this: https://nassimtaleb.org/2016/08/i…

Huh. Property tax is already a thing of course, but I guess if the LVT was going to replace all taxation the stakes would be much higher. In an urban setting, it seems to me that the land value should be... reasonably uniform, unlike property, which should make assessing much easier, right? But that's just getting the number. Whether people are happy with the number is a whole 'nother problem.

> Property tax is already a thing of course

Yes, but note that property taxes are extremely unpopular:

> America's most hated tax: Local property tax (42%) By far, America's most hated tax is your local property tax! It's almost ironic that your home, perhaps the single greatest source of taxable deductions on your federal income taxes, is also the greatest source of dislike when it comes to taxes in general among the American public with 42% responding that they felt it was the least fair tax of all.

Source: https://www.fool.com/investing/general/2013/11/02/americas-5...

It looks like that 42% number comes from this Gallop poll: https://news.gallup.com/poll/1714/taxes.aspx

They have a sort of purity and logic that appeals to economists, but they're intuitively hated by everyone else.

Re: Book Review: Progress and Poverty

#76

Post by snidane »

AnimalMuppet wrote: post #73
prichino wrote: post #71

Earlier quoted context omitted.

The username checks out; where do you think wealth comes from if not land? Paper money in the end is just a representation of claims for assets generated from land. Food, minerals, energy, actual things all come from land. You cannot eat a metaverse.

> The username checks out; where do you think wealth comes from if not land? I gave several examples of wealth that doesn't come from land. I asked for an explanation of how, in those examples, wealth came from land. You reply with an insult to my chosen username. That's... not a very good argument. > Paper money in the end is just a representation of claims for assets generated from land. Here you're using the assum…

Georgists divide into two categories. They define land differently, or emphasize different aspects of it.

1. Left wing georgists. Land = resource needed for human life. Humans cannot fly, therefore land is a life necessity. Food grows on land and nowhere else, therefore land is necessary for life.

2. Right wing georgists. Land as a monopoly. Electromagnetic spectrum (5g, wifi, radio waves) cannot have too many owners of a band otherwise you get interference. Google.com domain can be owned only by one entity otherwise you get mess. For actual land (geographical parcel) you hold exclusive use rights, that others have to respect, otherwise you get fights for territory. All of these - geo area, name system, electromagnetic spectrum - constitute a form of land. There are grades of it which differently priced and only one owner can operate it at a time.

Land is still the most important section of economy. Real estate is mainly land speculation. You can observe billionaires investing in real estate and land when there is nowhere else to invest, so it definitely is not piece of worthless nothing that only had value in 19th century when majority of population was still employed in agriculture. Except homeless, 100% of population is invested in real estate. Only tiny portion of money is spent on stocks comparatively.

Georgist philosophy lives completely ouside of the current left right spectrum, both on the political and cultural level. However, if it become the next societal paradigm, you'll see this divide again. It is becoming a real possiblity it'd become the next paradigm because after zero interest rate policy, quantitative easing, helicopter money and debt amnesties, the only choice is between a war and georgism.

Re: Book Review: Progress and Poverty

#77

Post by pessimizer »

dionidium wrote: post #75
bee_rider wrote: post #8

Earlier quoted context omitted.

Huh. Property tax is already a thing of course, but I guess if the LVT was going to replace all taxation the stakes would be much higher. In an urban setting, it seems to me that the land value should be... reasonably uniform, unlike property, which should make assessing much easier, right? But that's just getting the number. Whether people are happy with the number is a whole 'nother problem.

> Property tax is already a thing of course Yes, but note that property taxes are extremely unpopular: > America's most hated tax: Local property tax (42%) By far, America's most hated tax is your local property tax! It's almost ironic that your home, perhaps the single greatest source of taxable deductions on your federal income taxes, is also the greatest source of dislike when it comes to taxes in general among th…

Lobbyists, PR professionals and the people who pay them own lots of property and pay property taxes. They're far harder for the wealthy to dodge than income or capital gains taxes. Of course the public has been trained to hate them, like they've been trained to hate estate taxes, and in some years public polls would show near-majorities against progressive taxation in general.

edit: it seems obvious because of the thread topic, but property taxes are the most easily and intuitively justifiable tax. People with more property use more public services.

Re: Book Review: Progress and Poverty

#78

Post by snidane »

TimPC wrote: post #2

Progress and Poverty was once the most popular economics book ever written. The Georgist Theory in it, and the land value tax proposed by it is still endorsed by economists today. This review clearly illustrates the ideas from George that land captures gains that in a more fair society we'd want to go to labour.

From Henry George wikipedia page:

> Commentators disagreed on whether it was the largest funeral in New York history or the largest since the death of Abraham Lincoln. The New York Times reported, "Not even Lincoln had a more glorious death."

https://en.m.wikipedia.org/wiki/Henry_George

Re: Book Review: Progress and Poverty

#79

Post by invalidOrTaken »

ryukafalz wrote: post #61
TheCoelacanth wrote: post #59

Earlier quoted context omitted.

They probably would decrease somewhat, because there's no longer an incentive for landowners to prevent people from building housing to keep the supply low.

This is something I’ve been wondering about with LVT. Wouldn’t they still have an incentive to stop people from building more dense housing near them? Even more of an incentive than now, in fact? Because the more people that can live and work in the immediate area near them, the more valuable the land is, and the more they’ll pay in tax.

As the land becomes more valuable, it becomes more valuable to them---better access to services, etc.

If it becomes more valuable, but in such a way that they can't leverage it, they can sell it.

Re: Book Review: Progress and Poverty

#80

Post by snidane »

colinmhayes wrote: post #53
mynameishere wrote: post #50

Earlier quoted context omitted.

I'm just going by the headline definition: "A land value tax is a levy on the value of land without regard to buildings, personal property and other improvements." That's the basic idea. I think people need to keep in mind the actual purpose of taxation: One group is taking resources from another. Nobody is pushing this tax (or any) because it's "efficient" or whatever. They are pushing it because they will come out…

The more I read about LVT the more clear it is to me that it legitimately solves many, many problems society is currently facing. The housing price crisis is effectively solved by LVT. The "greedy landlord" meme is effectively solved by LVT. Income tax being distortionary is solved by LVT. NIMBYism caused by people wanting their home to be worth more is solved by LVT. Yes, some are better off, some are worse. It's no…

Your assessment is correct. The fact that implementing such a simple scheme as LVT would lift up many societal issues suggests that the entire problem that it aims at is the society's bottleneck.

From system design we know that no matter how much we optimize other parts of the system, no gain in performance will be achieved because the flow still has to go through that bottleneck. So we should focus on removing that narrow part before even engaging in discussions about other economical topics such as minimum wages, healthcare or education funding etc.

Society has it backwards.

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