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Seeing like a state, progress and poverty, and owning land

loukidelis.com

141–150 of 156 posts

Re: Seeing like a state, progress and poverty, and owning land

#141
post #124
post #107

Earlier quoted context omitted.

The math on this idea is laughable though. Giving out $1 Million in tax credits per person in the US is $330 trillion dollars. Given that the US Federal Government only collects about $4 trillion in taxes and probably still wants to collect more than $0 then this scheme doesn't really work. Getting a $10,000 tax credit in exchange for nearly completely obliterating the federal budget just doesn't have the same oomph.

At some point I need to do the math and get an economics degree and use this idea to start a think tank. The standard federal tax deduction is $12.5k and average US income is about $30k and US GDP is around $20 trillion and GDP per capita is about $60k. So you have about 50% of the economic output to work with. And you're right, average income tax per capita is $10k. Maybe $100k or even $10k is a better ball park sta…

A $100k tax credit means there is such a large surplus of tax credits that not only does the government tax $0 after credits, but also large numbers of credits go completely unpurchased. This doesn't seem like a good system at all.

Corporate tax rates are around 12% after deductions and constitute less than 20% of current taxation. If you raise those corporate tax rates to 96% above a certain threshold you collect less than 8-times the current revenue. Even 8 times current revenue would get you less than $6 trillion in revenue from corporate tax which would let you improve your tax deduction from $10,000 to $20,000 if you wanted all the tax credits to get purchased and government to collect no tax revenue. You've now completely reformulated all of how corporations work and obliterated a large portion of shareholder revenue and you need eight more equally large changes to get to $100k. I don't think you have them.

Re: Seeing like a state, progress and poverty, and owning land

#142
post #100

Earlier quoted context omitted.

This is wrong under a 100% land value tax. The value of land is a perpetual income stream an if the government takes all of this value the price of land falls to $0 regardless of all the amenities that improve it. Each amenity that improves it raises the tax which captures all the additional value from that external improvement which keeps the price at $0. Only improvements on the land itself will add to the price. O…

Yes, this is true. But as tax money is raised, the local government has a choice 1. They can use the tax money to fund services. 2. They can return the tax money collected as a Citizen's Dividend. If they don't have any need for any more services, everyone would still be able to live there. Your concern that people will lose their community are unfounded. They might decide, as the tax goes up, that they don't need a…

Georgists generally believe that everyone has an equal right to all land and all natural resources. This makes the correct scale for a CD global if possible and national if not possible. The CD is a poor tool for keeping up with the cost of living when it's not highly localized. But localizing it is a form of neo-feudalism where people have wildly different entitlements based on where they are born.

Re: Seeing like a state, progress and poverty, and owning land

#143
post #142

Earlier quoted context omitted.

Yes, this is true. But as tax money is raised, the local government has a choice 1. They can use the tax money to fund services. 2. They can return the tax money collected as a Citizen's Dividend. If they don't have any need for any more services, everyone would still be able to live there. Your concern that people will lose their community are unfounded. They might decide, as the tax goes up, that they don't need a…

Georgists generally believe that everyone has an equal right to all land and all natural resources. This makes the correct scale for a CD global if possible and national if not possible. The CD is a poor tool for keeping up with the cost of living when it's not highly localized. But localizing it is a form of neo-feudalism where people have wildly different entitlements based on where they are born.

I'm pretty sure you can have both if the tax bubbles up. You pay the local tax. That tax money then goes and pays the city tax. The city tax pays the state tax, the state tax pays the country tax, the country tax pays the global tax.

You are responsible for the improvements on your land, and you pay for the unimproved value of that land that comes from all higher levels. The local government on the other hand is responsible for local infrastructure, and pay for the city+ based unimproved value.

A landlocked country would pay less tax, a city at the mouth of a river pays higher tax, a locality with a beach pays higher tax, etc... this ensures that each level has some accountability and is incentivized to improve.

At each level is money left over after paying the tax(I hope!), and can either be invested or can be returned as a dividend.

One of the main unresolved issues with Georgism is the Disney World problem, and I believe that if you structure the tax in this way that problem goes away. Disney would simply be labeled not as a household actor, but as a city level actor.

Re: Seeing like a state, progress and poverty, and owning land

#144
post #108
post #39

Earlier quoted context omitted.

People hate to hear this but noone has a right to live somewhere indefinitely. Logically, this doesn't even work. Lets say everyone in LA wants to live there with their children and their children's children and so on forever. Extrapolate this a few generations and eventually you will have a solid mass of humans 1000 ft tall. (This is a hyperbolic joke, you get the point)

People hate to hear this but noone has a right to live somewhere indefinitely I am sure you feel it made sense when you wrote it, or the example explained it in any way. I absolutely failed to understand the common knowledge aspect about people's limits to their ownership rights or even understand the sequence of events or mathematical explanation of the example.

Over time, the number of people that can lay claim to their right to live in LA forever will/could grow exponentially. The space is limited. Particularly so when you have prop 13. These two facts are incompatible. What you will get in reality is an ever-ballooning housing price, pushing everyone else out and single-family home owners locking in their "right" to the space through market-distorting laws like prop 13.

I ask you this, why do the people living in LA have more of a right to be there than the native Indians that were there 500 years ago?

Re: Seeing like a state, progress and poverty, and owning land

#145
post #138

Earlier quoted context omitted.

Please give me an example? Or give me an example of an affordable city that is also high density in America. I haven’t seen it.

I don't have an example and I'm not saying there are affordable high density cities. What I'm saying is that they aren't expensive because of the density. They are dense, because they are expensive, because they are very desirable places to live. You wouldn't densify an area where no one wants to live...

To your point, I desire to live in Atherton. It is not affordable. Nor is it high density or will ever be.

High density is imposed upon medium density middle class zipcodes because it is the middle class that is working class.

There are more jobs in this zipcode because the govt has chosen to create infrastructure(often supported by the employers like FAANGs or HP at a time etc in the Bay Area for example). It was meant to benefit the workers.

But as these cities prospered, it became crowded. Instead of creating new cities with good infrastructure to replicate the success of tier 1 cities, corporations and governments are trying to stuff more sardines in a small metal can.

The FAANGs are basically run by the employees who are woke adult children who have never had any real life experience or have travelled beyond the confines of their fantasy world. The Govt is run by the equivalent of a pirate with a wooden peg leg and a green plastic parrot on its shoulder plundering the working middle class for extractive taxes with no returns and punishing the productive.

The ‘desirability’ is the availability of jobs. Corporate America and Big Govt are hand in glove as they keep scratching each other’s back. The immigrant tech work force often has no voice as most of them are denied green cards due to what is racism. An Indian or Chinese passport sends you to way back to the end of the immigration line. There is no DACA for the children of tech workers, mind you.

They are treated like cattle and then squeezed to death by taxes. The visa is the chain that binds them because they don’t even have the mobility to move to another job or city that is more affordable. If this isn’t thuggery and theft by Big Gov+Corporate America, I don’t know what is..

I have looked at the minutes of many city council meetings in the Bay Area. Every high density initiative is always wherever there is a substantial tech immigrant population..often Indian/Asian. And the high density is often affordable housing quotas to bring people from other Bay Area cities which is a redistribution program. In one Bay Area city, high density housing is mandated by Sacramento to bring in the homeless and create affordable housing from other cities in the county. But no new schools or roads. No community spaces and existing green and open spaces are being built. There is BART which is basically transport for people who come to the city to steal Amazon packages and catalytic converters. There is an increase in social spending for the new entrants but no increase in law enforcement even though crime has soared, no new fire stations and retail/shopping options have shrunk. Water, electricity and every utility bill has gone up by 25%. Property taxes increase every year and so does cost of living.

What Corporate America and Big Gov needs to do is create more fantastic cities that are desirable. As an Example: Why this scarcity mentality that there will be only one Bay Area? Bay Area is a modern day labour camp. It’s expensive and crowded not because it is desirable but because people are trapped. Trapped by their jobs and by taxes.

Re: Seeing like a state, progress and poverty, and owning land

#146

Earlier quoted context omitted.

> They lost their homes which is not just a house. You want me to feel sorry for someone who gets a Million dollar windfall when: 1) they got a million dollar windfall 2) they now have a ridiculous amount of options (because money = options) 3) if they're really determined to stay in their house, they can cash-out refinance continuously and use some of the unrealized gains to pay property taxes (and past cash-outs) 4…

They got a million dollar windfall in a market now shifting to where the average buyer is in a position to drop a million plus without blinking. You can be poor, even with a million in such a market, and all that happens if you move somewhere cheaper to start again, is you perpetuate the cycle.

That's exactly the cycle of population growth. Either we build more housing to accommodate everyone, or poor people get kicked out by the rich.

The question is whether the Georgist solution is more equitable than what we have today. But no system can magically solve the problem of supply and demand.

Re: Seeing like a state, progress and poverty, and owning land

#147
post #144
post #108

Earlier quoted context omitted.

People hate to hear this but noone has a right to live somewhere indefinitely I am sure you feel it made sense when you wrote it, or the example explained it in any way. I absolutely failed to understand the common knowledge aspect about people's limits to their ownership rights or even understand the sequence of events or mathematical explanation of the example.

Over time, the number of people that can lay claim to their right to live in LA forever will/could grow exponentially. The space is limited. Particularly so when you have prop 13. These two facts are incompatible. What you will get in reality is an ever-ballooning housing price, pushing everyone else out and single-family home owners locking in their "right" to the space through market-distorting laws like prop 13. I…

How is the potential problem of housing future people an argument for a policy that allows kicking out existing owners? They don't seem to me related. This is about the rights of ownership.

The problems you mention stem from various "kick out" policies that are essentially forced assets transfer and artificial scarcity policies to inflate prices (difficulty for new housing, one family houses, height of buildings, devaluation of residential areas by bad policing etc)

Housing prices are results of specific policies, and people's ownership rights are protected in western societies.

Re: Seeing like a state, progress and poverty, and owning land

#148
post #141
post #124

Earlier quoted context omitted.

At some point I need to do the math and get an economics degree and use this idea to start a think tank. The standard federal tax deduction is $12.5k and average US income is about $30k and US GDP is around $20 trillion and GDP per capita is about $60k. So you have about 50% of the economic output to work with. And you're right, average income tax per capita is $10k. Maybe $100k or even $10k is a better ball park sta…

A $100k tax credit means there is such a large surplus of tax credits that not only does the government tax $0 after credits, but also large numbers of credits go completely unpurchased. This doesn't seem like a good system at all. Corporate tax rates are around 12% after deductions and constitute less than 20% of current taxation. If you raise those corporate tax rates to 96% above a certain threshold you collect le…

Just wanted to say thanks again for the detailed and thoughtful response! It was just a thought experiment but thanks for making me think it through a little more. I was originally thinking "hey, some corporations already buy carbon credits, why not give people some tax credits and let the corporations buy those too". But the numbers totally don't make sense. I know it would never be workable, but the napkin math doesn't work either so the whole idea is basically nonsense. I always just sort of assumed that corporations don't pay enough tax and if you tweaked that formula a bit there'd be plenty of money for free health care and ice cream parties.

I do still think it's kind of a neat idea but at lower amounts, as you've pointed out, it also doesn't move the needle much because corporations don't actually pay that much tax in the first place compared to the size of the population of the US. Allocating a chunk of any real money to a 330+ M population really adds up quick too. I think the motivation (as one of the parent comments suggested) was to try and provide some kind of basic income but also to boost the "value" of a worker in some way so we don't all get replaced by robots and GPT3000. The bigger problem right now isn't employment though, it's wages and inflation, and this doesn't really help that much.

I did finally look at some tax revenue numbers instead of just wildly guessing. :) The bottom 50% of taxpayers (75M people) pay on average $650 in taxes and their total contribution is 48 billion, around 3% of the total taxes paid [0]. In 2019 revenue from corporate income tax was $230B, but that looks to be closer to 10% of the total federal revenue from income tax for that year on this other chart [1]. Interestingly those two sources don't match but whatever, it's close enough for government work.

So, even a 3k floating tax credit just for that bottom 50% segment instead of everyone would "cost" the system about $225B for those 75M people which is pretty close to the corporate tax revenue. So let's see what that would look like. If you doubled the corporate tax rate to pay for all this then you'd have $460B from corporate tax to start, then $225B credits are redeemed, leaving $235B. Of course, nobody is going to pay $3k for $3k of credits, so the exchange rate would probably converge to closer to the tax rate something like 10:1, and now you're talking about 300 bucks per person and another $25B in "cost" to the corporations to buy their tax credits back. So then you've effectively increased corporate taxes to $260B which is like +13% after all the credits are redeemed and you've only given half the population 300 bucks.

I think the amounts are definitely too low for anyone to care. Even at 10x it isn't that interesting and as you point out, you could 100x it and tax corporations at a 1000% rate just to get into poverty level universal basic income territory.

It would be a lot easier to just eliminate taxes on that demographic and maybe bump the corporate tax rate by 20% to cover it without all this credit reassignment nonsense.

Maybe the current system isn't the worst after all? Maybe I'll try to come up with a plan to fix the health insurance system in this country instead, it's probably easier. :)

[0] https://taxfoundation.org/publications/latest-federal-income... [1] https://www.taxpolicycenter.org/statistics/amount-revenue-so...

Re: Seeing like a state, progress and poverty, and owning land

#149

Earlier quoted context omitted.

This is not the case where I live. Levy rates are set in statute.

Are rates proportional to house valuations used in “most places in the U.S”? That is, are most rates not “mill rates” (where relative house values matter, not absolute values).

Yeah I'm very curious about this. I assumed that because my taxes have been purely proportional in the several places that I've lived that this was generalized to across the U.S.

This is the first I've heard of a city adjusting taxes down.

Re: Seeing like a state, progress and poverty, and owning land

#150
post #8

Earlier quoted context omitted.

By 'lose the land', really they'd be forced to sell or go bankrupt/accrue tax debt. Which is pretty terrible if the folks are little old ladies settling down to avoid the cruel harsh world, and now need to find somewhere else to live when they are least capable of doing so (being on a fixed income and all). The 'can't put old widows out of their homes' scenario is why California's Prop 13 came to be, btw. Even withou…

Unless the laws are bad, if property taxes are going up to the point you can’t afford them, why wouldn’t you rent out enough of your high value property to pay them, and live in the rest? That might mean building an ADU or a multi-family unit where you live in one of them, but I don’t see why “people will need to move when their homes rise in price” is a legitimate argument. Unless the laws prevent you from both livi…

The laws mostly prevent this yes. Either from zoning, or logistics. Not many single income retirees can pull off constructing an ADU on their own property.
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