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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?

#311

Post by Anderkent »

midasuni wrote: post #224
larsiusprime wrote: post #152

Earlier quoted context omitted.

So you're basically describing the slumlord situation. Let me grab a figure from the book review: https://cdn.substack.com/image/fetch/w_1456,c_limit,f_auto,q... So imagine that the return from land was taken away. The only thing a landlord can charge rent on now is providing a nice building (capital) and good service & maintenance (labor). The first property, "a nice house" would be able to charge rent -- because it…

> thus can't be passed on to tenants Currently you charge tennant a as much as you can until they no longer live there. That works out to be as much as they can pay for the benefit they get. If you charge 1k a month now, the reason you don’t charge 1200 is because they won’t pay it. If you have a LVT, and try to increase the rent, your tennent wouldn’t be gaining any more value from the land that they currently are,…

>If you charge 1k a month now, the reason you don’t charge 1200 is because they won’t pay it.

>If you have a LVT, and try to increase the rent, your tennent wouldn’t be gaining any more value from the land that they currently are, so you still won’t be able to charge 1200.

This only holds if there's no competition between landlords - so the landlord extracts the maximum possible rent from each tenant. If I'm a tenant and living in this area is worth $1500 for me; but there are two landlords competing to have me pay them, I might end up paying $1000. If then both landlords raise their prices to pass the LVT, my rent ends up higher.

It's an empirical question and not easy to answer as to how much of the economic surplus is captured by the tenant vs landlord

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

#312

Post by mindslight »

mech422 wrote: post #172
mindslight wrote: post #94

Earlier quoted context omitted.

> the suburban hellscape is definitely a lot more economically productive Neither dense suburbs nor rural suburbs are defined by economic productivity, because they're residences. If this shifts with work from home, their focus will still be on quality of life rather than packing people in as close as possible for more "specific revenue". > the rural living you describe is probably no better If you have to drive ever…

>>Furthermore I'm currently in a quasi-rural area with gigabit muni fiber, so I don't buy that argument either. Whether there is the political will to build out modern Internet access or suffer the extractive oligopoly depends entirely on the politics of an area. Our experiences color our views. I grew up in rural towns ( I ran as fast as I could when I was 18. oh - and btw, pulling utilities can be quite expensive -…

I ran too, from a suburban area calling itself a city to an actual city. And I loved the walk/bike/lightrail restaurant/concert/etc lifestyle. But ultimately if you want to get some relief from the rent treadmill (which includes "buying" shared walls with unreasonably high valuations), you inevitably end up back in less dense areas.

Suburbs are certainly not my ideal of "heaven". I feel like I'm being argued with by younger people still in the phase where they're in love with the city, extrapolating my points into general indictments of density. They're most certainly not. All I'm pointing out is that once you're already past needing to drive everywhere, having the space to actually do things and be left alone is much nicer than being packed up on your neighbors.

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

#313

Post by AnimalMuppet »

imtringued wrote: post #227
AnimalMuppet wrote: post #134

Earlier quoted context omitted.

No, I did not in fact read the whole thing. My life is too short. Only 400k houses? I don't think that supports your point very much. Apple, Amazon, or Google have land footprints that are far smaller than 400,000 houses. And, the growth in inequality is coming from land? The top 0.01% have what percent of their assets in land? And, which came first? Did they make their money on stocks and then buy the land to divers…

According to dirk löhr a big chunk of stock market valuation is based on real estate and ultimately land. Once you include other land like monopolies like spectrum or patents you're looking at more than 60% of the value of a given stock being tied up in those things. Bill gates owns a huge amount of farm land. Land is still one of the biggest factors of production and the biggest driver of inequality in the 21th cent…

> Once you include other land like monopolies like spectrum or patents you're looking at more than 60% of the value of a given stock being tied up in those things.

Yeah, see, that's part of my point. Why just do land, and not "other land like monopolies like spectrum or patents"? Or domain names? Some of those are pretty valuable...

> Bill gates owns a huge amount of farm land.

Sure he does. How did he get the land? Well, he made a ton of money on Microsoft stock, and eventually he sold some of it, and bought land. How much of his money did he make via stock, and how much via land? (Granted, he had the stock longer...)

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

#314

Post by dragonwriter »

roenxi wrote: post #213
whakim wrote: post #183

Earlier quoted context omitted.

So why not tax gold or bitcoin or the Mona Lisa if the main difference between taxable assets and non-taxable assets is scarcity?

The post didn't use the word scarcity. Land isn't even scarce, most land is effectively uninhabited compared to the population densities most people live at. Humanity at large is not short of land. Land is quite unique. It is the resource with the weakest argument that humans produce it. Gold, for example, requires human labour to be dug up. Bitcoin requires humans to run machines. The Mona Lisa requires humans to pa…

> Land isn't even scarce

Yes, it is (or, at least important subsets of land are.) If it wasn't, it would have zero value. Nonzero market value requires, and therefore proves, scarcity.

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

#315

Post by bradleyjg »

DarylZero wrote: post #292
bradleyjg wrote: post #268

Earlier quoted context omitted.

> but there's no obvious reason to think we're way better at one or the other. There’s a very good reason. Sales of buildings plus land happen all the time, whereas sales of just land are virtually non-existent in a lot of the places with the most valuable property (e.g. Manhattan). Without real sales to tether the analysis you are just guessing.

Buildings are demolished in Manhattan on a regular basis, granted not that often. There are real sales of empty plots. Also if you know a building would cost $X to replace, but the plot with it sells for $X+$Y, you have some real information, not just guesses!

How much would it cost to replace the Empire State Building?

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

#316

Post by caeril »

Land Value Taxes are an immediate nonstarter for anyone who cares about the environment or conservation.

Imagine wanting to start an urban community garden and make your city a nicer place to live, but the taxes are prohibitive because you could have built a concrete monstrosity there instead.

Taxes predicated on the money you could have hypothetically made by paving over everything is a great way to ensure that you'll pave over everything.

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

#317

Post by mindslight »

sagarm wrote: post #309
mindslight wrote: post #295

Earlier quoted context omitted.

I said "trash disposal" for a reason. Rather than handwave that things cost "more" with area, the sane way to analyze it is in terms of their growth. Rather than talking in terms of lot area, it's clearer to discuss in terms of single dimension distance between houses (lot area ~= L^2), holding population constant. Schools/hospitals/trash disposal/wastewater treatment - heavily proportional to population, with a negl…

Your argument about costs ignores the key fact that rural areas are far less productive than urban areas, and so cannot afford even the same per-capita rates as urban areas. As for the land value economics of multi-family development in rural areas: it just isn't that important IMO. However your described scenario seems like a great way for the rural area to become economically relevant by gradually building up a fun…

I don't see how this "productivity" you're talking about is relevant to my point. The page you link is talking about the large scale urban-rural balance, not analyzing the gradient in a given region.

Cities themselves are obviously centers of commerce and concentrations of wealth - but it's nonsensical to extrapolate this feature as applying to slightly denser suburbs. If someone lives in the suburbs and commutes into the city to work, then all their "productivity" happens in the city. And obviously the more workers you can fit into a given area, the more work gets done (cf factory housing).

Furthermore, cities are inherently more interconnected and thus the activities there are more legible to the system, whereas rural work is less so - eg a couple working full time plus and hiring maids/contractors/etc to take care of their home creates a lot more cashflow than a rural couple DIYing.

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

#318

Post by pydry »

CryptoPunk wrote: post #277
pydry wrote: post #247

Earlier quoted context omitted.

This is essentially saying that the rich must be kept rich to prevent them from hurting us. You're saying that they must be paid protection money. Slavery wasn't as big a part of the economy of the British Empire as it was to the American south. In any case the US made back a lot of the losses of the war during the period of reconstruction.

It's not about rich or poor. Any group, if you threaten their economic interests, will retaliate. Take for instance public sector unions: they have grown from strength to strength over the last 50 years, and today are owed trillions in pensions, from sweetheart collective bargaining agreements, that have massively increased their benefits, while degrading the quality of public services, like public education: https:/…

It's kind of weird that you hold up unions as an example of a group who would go to war if their economic interests are threatened, yet they have not just been threatened they have had a scythe taken to them since the 1970s and yet here we are. No war.

But you think that the fascists should have money thrown at them because they're more violent than the rest of us?

I don't believe an LVT should be ramped from 0% to 100% immediately. Would boiling the frog be more effective and safer? Certainly.

If a far right terrorist movement were to emerge as a result of a policy like this, should it be appeased? You may very well think that. I couldn't possibly comment.

>The damage from the Civil War is still not fully repaired.

After the civil war America rebuilt itself into the world's richest and most powerful country. Some people would count that as "doing ok".

It could have very easily turned itself into yet another bloated oligarchy like Argentina rather than growing into the world's most powerful industrial superpower if existing economic relations were deliberately maintained.

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

#319

Post by francisofascii »

caeril wrote: post #316

Land Value Taxes are an immediate nonstarter for anyone who cares about the environment or conservation. Imagine wanting to start an urban community garden and make your city a nicer place to live, but the taxes are prohibitive because you could have built a concrete monstrosity there instead. Taxes predicated on the money you could have hypothetically made by paving over everything is a great way to ensure that you'…

Simple fix. Community gardens are tax-free. A big reason why much of America is covered with mostly empty asphalt parking lots is because is costs very little in land taxes.

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

#320

Post by ineptech »

bradleyjg wrote: post #268
ineptech wrote: post #113

Earlier quoted context omitted.

Inaccuracy isn't a very big component of this; assessing the value of land and structures isn't perfect but there's no obvious reason to think we're way better at one or the other. The point of this is that taxing the land only would lead to land being used differently, which would benefit society. Suppose there is a plot of land which (from some omniscient point of view) would offer maximal benefit to society if a f…

> but there's no obvious reason to think we're way better at one or the other. There’s a very good reason. Sales of buildings plus land happen all the time, whereas sales of just land are virtually non-existent in a lot of the places with the most valuable property (e.g. Manhattan). Without real sales to tether the analysis you are just guessing.

a) You're implying that we use sale prices to set the assessed value of property today; I believe that's often not true. I happen to have the tax slip for a property in front of me, the assessed value is about 80% of what I paid for it five years ago. Assessments are already inaccurate, because they're more a product of politics than science; a LVT wouldn't magically fix that, but AFAICS it wouldn't necessarily make it worse.

b) You may not be confident in your ability to distinguish the value of the land from the value of the structure, but your insurer is. If you want to know e.g. how much your home's value would improve if you finished out the basement or built a garage, they will go through it with you on the phone. Sure, it's something of a guess, but a very educated one.

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