NIMBYs in the twenty-first century • Hacker News Board

Re: NIMBYs in the twenty-first century

#31

Post by _delirium » Wed, Mar 25, 2015, 3:47 PM UTC

matwood wrote: post #19

nwah1 wrote: post #18

Housing is a euphemism for land. The value of locations is determined by the quality of the surrounding community and the environment. This value winds up in land because it is claimed for exclusive use by individuals, enforced by government. Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it. Instead of Piketty's blunt "we…

Who isn't paying taxes on their land value? Maybe there are some states that do not, but every year I pay a pretty large tax bill based on the value of my land/house.

One way it happens: In much of the U.S., agricultural land is either exempted, or taxed at a very low rate. The stated rationale (besides openly being an agriculture subsidy) is as a kind of anti-gentrification measure for farmers. Farmers complain that rising land values, due to e.g. expanding cities, would "price them out" if they had to pay taxes on the full (non-agricultural) market value of the land.

In practice it's common for large-scale property investors to use this as a way to accumulate and hold land tax-free or nearly tax-free. At least in Texas almost all large land holdings are held as agricultural land for that reason. Investors keep the land classed "agricultural" until such time as they want to actually develop it. Sometimes this is really agricultural land in addition to being an investment; other times a few gratuitous cows are thrown on some land purely for tax reasons (this is why the city of Houston has a surprising number of tiny cattle ranches within the city limits). The end result either way is that you can accumulate land over long periods of time without paying much in the way of taxes.

Re: NIMBYs in the twenty-first century

#32

Post by nwah1 » Wed, Mar 25, 2015, 3:55 PM UTC

jerf wrote: post #30

timclark wrote: post #24

Earlier quoted context omitted.

Not every country taxes land in that way. I own no land but pay tax for occupying a property, my landlord pays no tax on this property - he may pay some tax on his rental income and will be taxed if the property is sold.

That's just accounting. In the end, the renter either effectively pays the tax or the property becomes unavailable for renting, because the rental income either covers the taxes and other expenses or it doesn't. This is important to understand because "well let's just raise taxes on rental properties" can sound really emotionally appealing to stick it to those nasty landlords, but the landlords aren't the ones who en…

According to David Ricardo's Law of Rent, a tax on land cannot be passed on to renters, because landlords are locational monopolists who are already charging as much as the market will bear.

"A tax upon ground-rents would not raise the rents of houses. It would fall altogether upon the owner of the ground-rent, who acts always as a monopolist, and exacts the greatest rent which can be got for the use of his ground."

   - Adam Smith, Wealth of Nations

"A tax on rent would affect rent only; it would fall wholly on landlords, and could not be shifted to any class of consumers. The landlord could not raise his rent, because he would leave unaltered the difference between the produce obtained from the least productive land in cultivation, and that obtained from land of every quality."

   - David Ricardo, On the Principles of Political Economy and Taxation

Re: NIMBYs in the twenty-first century

#33

Post by mixmastamyk » Wed, Mar 25, 2015, 3:56 PM UTC

nwah1 wrote: post #18

Housing is a euphemism for land. The value of locations is determined by the quality of the surrounding community and the environment. This value winds up in land because it is claimed for exclusive use by individuals, enforced by government. Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it. Instead of Piketty's blunt "we…

This sounds like Henry George, a guy I never heard about in school, but had some quite interesting ideas.

http://en.wikipedia.org/wiki/Henry_George http://en.wikipedia.org/wiki/Georgism

... in short capitalism for work, but collective use of land to recognize its unique ability in compounding inequity.

Re: NIMBYs in the twenty-first century

#34

Post by leviathant » Wed, Mar 25, 2015, 3:57 PM UTC

psaintla wrote: post #11

pcarolan wrote: post #3

Conventional wisdom says that homes are bad investments compared to equities, conventional wisdom looks to be wrong. Maybe loading up your 401k instead of buying a home isn't such a good idea. The right answer is probably to rebalance a bit towards property.

Yes, which is always why I always cringe when I see how many people in their 20s and 30s believe that home ownership is a bad idea. The willingness to rent for life in order to live a high density, urban lifestyle is going to come back to haunt them when they get older. It's good for me as a landlord but I hope people my age start rethinking their position on home ownership.

I was resistant to buying a house here in Pennsylvania, but my wife's from Sydney, Australia, and was gobsmacked by how inexpensive real estate is here. By 26, we had bought a small house in the Philadelphia suburbs about three blocks from a train station and renovated it over the course of a few years. We were able to purchase a larger house in Philadelphia proper, and rented out the house in the suburbs - which covered the price of that house's mortgage and subsidized the newer house's mortgage. Aggressively paying down the first house, it's now paid off, and is just straight income, and we're more than halfway done paying off the mortgage on this house.

This year, we actually dumped our investment account for a sizeable property in an amazing spot (on the waterfront, where the historic district meets the trendy hipster district), with commercial space on the first floor, an apartment on the second floor, and we'll be financing the expansion to a third floor by selling off the other two houses we have.

I'll be living in a new-construction home above a performing arts space that I own outright, paid for by a second floor apartment I'll be renting out, in a high density, urban environment - because my wife and I bought a house when we were 26.

Re: NIMBYs in the twenty-first century

#35

Post by JoshTriplett » Wed, Mar 25, 2015, 4:00 PM UTC

nwah1 wrote: post #18

Housing is a euphemism for land. The value of locations is determined by the quality of the surrounding community and the environment. This value winds up in land because it is claimed for exclusive use by individuals, enforced by government. Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it. Instead of Piketty's blunt "we…

> Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it.

One very easy principle can: the value of land goes down dramatically if you can't kick other people off of it. Exclusive use is critically important. Unless you'd like other people traipsing through your house.

Re: NIMBYs in the twenty-first century

#36

Post by mikeash » Wed, Mar 25, 2015, 4:02 PM UTC

ForHackernews wrote: post #4

> Modern forms of capital, such as software, depreciate faster in value than equipment did in the past: a giant metal press might have a working life of decades while a new piece of database-management software will be obsolete in a few years at most. Is software even capital? Isn't this part of why we've been arguing against software patents for years now? Obviously software and other forms of intellectual property…

I don't think the argument about software patents is related to capital.

The argument for patents is that it encourages people to invent things, because they have a guarantee of exclusive use which makes it easier to make money from their invention. It also encourages people to make inventions public instead of keeping things secret and then the knowledge being lost, since that's required as part of obtaining a patent. The US Constitution spells this out explicitly: the purpose of patents and other such things is "To promote the progress of science and useful arts...."

The arguments against software patents are basically that it doesn't have the desired effect. Much of what gets patented gets rediscovered independently, and thus it doesn't seem to actually encourage innovation. Nobody seems to ever go digging through patent archives looking for useful software techniques, so the fact of making patented inventions public also doesn't help.

None of this has much to do with software as capital, which would work much the same with or without software patents.

Re: NIMBYs in the twenty-first century

#37

Post by nwah1 » Wed, Mar 25, 2015, 4:05 PM UTC

JoshTriplett wrote: post #35

nwah1 wrote: post #18

Housing is a euphemism for land. The value of locations is determined by the quality of the surrounding community and the environment. This value winds up in land because it is claimed for exclusive use by individuals, enforced by government. Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it. Instead of Piketty's blunt "we…

> Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it. One very easy principle can: the value of land goes down dramatically if you can't kick other people off of it. Exclusive use is critically important. Unless you'd like other people traipsing through your house.

Exclusive use is important, but who gets it is currently arbitrary. To make it non-arbitrary, the titleholder should pay rent for the privilege.

http://libertythinkers.com/education/a-landlord-is-a-governm...

Re: NIMBYs in the twenty-first century

#38

Post by tomjen3 » Wed, Mar 25, 2015, 4:11 PM UTC

sun_machine wrote: post #13

I am confused by the way the Economist phrased Mr. Rognlie's argument. The crux of Piketty's argument is that when global returns on wealth (r) is more than global economy growth (g), capital will start snowballing into the hands of the few very quickly. The mechanism of r getting bigger than g is not an increase in r, but a decrease in g. The increase of the global economy is dominated not by increasing technologica…

You seem to be under the assumption that the population is going to grow towards infinity. The UN projects that we will stay under 10 billion (http://en.wikipedia.org/wiki/Projections_of_population_growt...) and even the highest only have us at 16 billion at the end of this century (compare that to the growth in the 20th century).

So unless there is a relatively low limit for total humans on this planet, we won't reach it before we become a spacefaring race, at which point the limit will be the carrying capacity of the Universe.

Re: NIMBYs in the twenty-first century

#39

Post by khuey » Wed, Mar 25, 2015, 4:11 PM UTC

matwood wrote: post #19

nwah1 wrote: post #18

Housing is a euphemism for land. The value of locations is determined by the quality of the surrounding community and the environment. This value winds up in land because it is claimed for exclusive use by individuals, enforced by government. Yet, claiming ownership over any part of the surface of this ball of space rock is arbitrary, and no principle of justice can truly legitimize it. Instead of Piketty's blunt "we…

Who isn't paying taxes on their land value? Maybe there are some states that do not, but every year I pay a pretty large tax bill based on the value of my land/house.

Anyone who owns property in the State of California, for one. Thanks Prop 13!

Re: NIMBYs in the twenty-first century

#40

Post by rrss1122 » Wed, Mar 25, 2015, 4:12 PM UTC

throwaway_xl5 wrote: post #6

hucker wrote: post #2

Paywalled... Does anyone have a mirror? edit: They removed it, thanks The Economist!

Economist lets you read a limited number of articles free of charge each month. The link gave me the full article so perhaps you used up your quota, or their rules are different in your territory?

You're right. I hit a paywall at first, but with private browsing got through to the full article, so I guess I used up my quota.