Georgism • Hacker News Board

Re: Georgism

#321

Post by ZeroGravitas » Tue, May 19, 2020, 10:24 AM UTC

roenxi wrote: post #22

JSavageOne wrote: post #14

Earlier quoted context omitted.

> If you had a choice, you would choose to be poor today, than to be poor a century or two ago. The classic false dichotomy that somebody always feels the need to point out in justifying the status quo.

The status quo is a jawdroppingly fast and totally unprecedented reduction in poverty [0]. If my goal were to reduce poverty; my strategy would be to defend the status quo. [0] https://ourworldindata.org/extreme-poverty

Hasn't most of that happened in Asia, where they are closer to Georgism in their treatment of land?

Re: Georgism

#322

Post by nybble41 » Tue, May 19, 2020, 5:40 PM UTC

ZeroGravitas wrote: post #320

nybble41 wrote: post #316

Earlier quoted context omitted.

> … which you didn't have to work for? To rent out property you must first own property. To own property you must buy property. Buying property requires resources. Accumulating enough resources to buy property requires a great deal of work, to say nothing of the effort which goes in to deciding which properties to buy or sell or the opportunity cost of deferring consumption. All of that work occurs before the first r…

The important parts of the discussion can be seen more clearly if we compare two different landlords rather than landlords vs non-landlords. Then it should become obvious that some part of the profit is due to "work" i.e. investing money in an area by building upgrading, and some part is due to other people doing the same. So in a hot new area, a bunch of people moving in, opening hip restaurants, renovating old buil…

Does the landlord get any credit for encouraging development in the surrounding area? For that matter, these "other people" may even be the same person in some cases, in which case they're both paying for the development and paying extra LVT due to the general rise in property values which they created. Even recognized physical improvements to your own property can cause property values for surrounding empty lots to rise, and you'd be paying LVT on that as well.

Let's look at a hypothetical case for a moment. Say I buy some otherwise nice property for cheap because it's in the middle of nowhere and there is no easy way to get to it. Trees, lakes, etc. but no nearby roads. The LVT would be low, right? If you auctioned it off in that state as unimproved property you wouldn't get many takers. But say I build a private road to that area at my own expense, and then rent out the now-accessible land in family-size lots. The land hasn't changed, but its value is much higher now because of something I did. How would the "unimproved" value of those lots be assessed, and who receives the LVT? If the answer to that last question isn't "me" (and it won't be) then someone is receiving an unearned benefit from my work.

Even if you think it's somehow "unfair" for property owners to benefit financially from general improvements in their communities, LVT doesn't change the fact that someone is still getting an unearned external benefit. It takes from the property owner without doing much at all to ensure that the LVT goes to the parties actually responsible for the improvement.

Re: Georgism

#323

Post by pydry » Tue, May 19, 2020, 7:31 PM UTC

JoeAltmaier wrote: post #314

pydry wrote: post #313

Earlier quoted context omitted.

>The landlord provides a usable piece of land They neither made the land nor made it valuable, so they're not "providing" it in any meaningful sense. They're relinquishing their state provided entitlement to expel users of the land with state-backed violence. In exchange for resources.

Ask an automaker: did they make the iron? No, it was a supernova 1B years ago.

Valuable mining rights should, broadly speaking, follow the same rules as land under georgism. rather than, say, "renting" it from some guy who has land deeds that say "i own this mountain".

what turns iron ore into a car is labor, which you should pay the laborer for.

that is, unless you think you should have a greater share of mineral rights than somebody else for some reason.

Re: Georgism

#324

Post by pydry » Tue, May 19, 2020, 7:35 PM UTC

nybble41 wrote: post #316

pydry wrote: post #312

Earlier quoted context omitted.

>Rent is hardly "free money". What would you call money which accumulates in your bank account which you didn't have to work for? (I could the portion of rent which would be left over after a rentier paying management fees here. Managing a property is work. Owning is not.)

> … which you didn't have to work for? To rent out property you must first own property. To own property you must buy property. Buying property requires resources. Accumulating enough resources to buy property requires a great deal of work, to say nothing of the effort which goes in to deciding which properties to buy or sell or the opportunity cost of deferring consumption. All of that work occurs before the first r…

>To rent out property you must first own property. To own property you must buy property.

Or inherit. Mayfair is rented out by the Duke of Westminster not because him or any or his ancestors did anything as crass as buying it but because he traces his lineage back to a mate of William the conqueror (note : not William the buyer. Conqueror. The distinction is important you see) in 1066.

Broadly speaking, all land wealth is derived this way, no matter how many hands it passes through on the way to its current owner.

You no doubt believe that the act of buying and selling land and working with it somehow "morally sterilizes" it. It does not. If Mayfair was sold it would still be conquered wealth.

I am very well aware that investments do not necessarily pay off immediately and you know very well that that is not what I am talking about at all.

Re: Georgism

#325

Post by ZeroGravitas » Tue, May 19, 2020, 8:39 PM UTC

nybble41 wrote: post #322

ZeroGravitas wrote: post #320

Earlier quoted context omitted.

The important parts of the discussion can be seen more clearly if we compare two different landlords rather than landlords vs non-landlords. Then it should become obvious that some part of the profit is due to "work" i.e. investing money in an area by building upgrading, and some part is due to other people doing the same. So in a hot new area, a bunch of people moving in, opening hip restaurants, renovating old buil…

Does the landlord get any credit for encouraging development in the surrounding area? For that matter, these "other people" may even be the same person in some cases, in which case they're both paying for the development and paying extra LVT due to the general rise in property values which they created. Even recognized physical improvements to your own property can cause property values for surrounding empty lots to…

If it genuinely is a private road then why would those plots be more valuable? If someone opened a business there you'd be able to extract all their profits since you control the only access.

Of course in reality it's not a private road or private sewer system or private fire service or private police force, it's all provided by government via taxes.

Taxes that people pay based on how much they earn, a far more obvious source of people being penalised for doing the right thing.

If you have an empty lot and you improve the district you can get your reward by selling the plot or opening your own business on it. Under LVT what you can't do is just sit on it for years at no cost to yourself, but great costs to others just in case it turns out to be a lottery ticket.

Re: Georgism

#326

Post by revnode » Wed, May 20, 2020, 2:07 AM UTC

tanzbaer wrote: post #285

revnode wrote: post #26

> The main Georgist policy recommendation is a tax assessed on land value. Georgists argue that revenues from a land value tax (LVT) can be used to reduce or eliminate existing taxes (for example, on income, trade, or purchases) that are unfair and inefficient. Fine in theory, the reality is that you get nailed for property taxes AND income taxes AND sales taxes AND everything else. If a government CAN tax it, it wil…

Depends on the state. Several state have no income tax. New Hampshire lacks income and sales tax.

All states have federal income taxes and all states have federal sales taxes (by way of tariffs).

Re: Georgism

#327

Post by nybble41 » Wed, May 20, 2020, 7:49 PM UTC

pydry wrote: post #323

JoeAltmaier wrote: post #314

Earlier quoted context omitted.

Ask an automaker: did they make the iron? No, it was a supernova 1B years ago.

Valuable mining rights should, broadly speaking, follow the same rules as land under georgism. rather than, say, "renting" it from some guy who has land deeds that say "i own this mountain". what turns iron ore into a car is labor, which you should pay the laborer for. that is, unless you think you should have a greater share of mineral rights than somebody else for some reason.

Would you not say that finding the mineral deposit is worth at least some reward, separate from the labor of mining and processing the ore?

Re: Georgism

#328

Post by nybble41 » Wed, May 20, 2020, 8:02 PM UTC

pydry wrote: post #324

nybble41 wrote: post #316

Earlier quoted context omitted.

> … which you didn't have to work for? To rent out property you must first own property. To own property you must buy property. Buying property requires resources. Accumulating enough resources to buy property requires a great deal of work, to say nothing of the effort which goes in to deciding which properties to buy or sell or the opportunity cost of deferring consumption. All of that work occurs before the first r…

>To rent out property you must first own property. To own property you must buy property. Or inherit. Mayfair is rented out by the Duke of Westminster not because him or any or his ancestors did anything as crass as buying it but because he traces his lineage back to a mate of William the conqueror (note : not William the buyer . Conqueror. The distinction is important you see) in 1066. Broadly speaking, all land wea…

> You no doubt believe that the act of buying and selling land and working with it somehow "morally sterilizes" it.

Nonsense. If that particular plot of land was stolen then the people it was stolen from are welcome to assert their claim. If they can prove that they have one, that is. A thief ("conqueror") does not through their theft obtain the rights to the property which is stolen, and cannot rightfully sell what they do not own. The buyer acquires nothing, and (if innocent) is welcome to sue the thief for fraud to recover what they paid.

However, leaving the ownership uncontested for this long would certainly dilute any claim based on ancestral rights. If there comes a point where no one else is claiming rightful ownership of the land then any prior claim can be considered abandoned, and whoever happens to be using it at that point holds the rights to it by default. Even if it was originally stolen. So the question becomes, has someone maintained their claim to the land and passed it down to their descendents from 1066 until now? Or was that claim permitted to lapse?

Re: Georgism

#329

Post by nybble41 » Wed, May 20, 2020, 11:03 PM UTC

ZeroGravitas wrote: post #325

nybble41 wrote: post #322

Earlier quoted context omitted.

Does the landlord get any credit for encouraging development in the surrounding area? For that matter, these "other people" may even be the same person in some cases, in which case they're both paying for the development and paying extra LVT due to the general rise in property values which they created. Even recognized physical improvements to your own property can cause property values for surrounding empty lots to…

If it genuinely is a private road then why would those plots be more valuable? If someone opened a business there you'd be able to extract all their profits since you control the only access. Of course in reality it's not a private road or private sewer system or private fire service or private police force, it's all provided by government via taxes. Taxes that people pay based on how much they earn, a far more obvio…

> If it genuinely is a private road then why would those plots be more valuable?

One assumes that the people I'm renting the lots to are permitted to use the road as part of their contract. But let's make this simple and say that I offer a perpetual agreement to let anyone use this road at cost, whether they rent from me or not. The road is a loss-leader; I intend to make my money by renting out the land, not by operating a toll road.

There are plenty of examples of communities with their own private roads and other services. Not everything of value to a community is provided by the government.

> you can get your reward by selling the plot

That won't work. Whoever buys it would be taking over the LVT payments, so that expense will come out of the resale value of the property.

> Under LVT what you can't do is just sit on it for years at no cost to yourself, but great costs to others just in case it turns out to be a lottery ticket.

And here we once again have someone failing to see the economic value of speculation.

The only reason to "sit on" the land and not use it would be that any use you could put the land to now would interfere with taking advantage of an even more valuable opportunity which you anticipate in the future. Not holding the land in readiness for that more valuable future use under such circumstances would be destructive.

Re: Georgism

#330

Post by somatic » Thu, May 21, 2020, 1:31 AM UTC

geofft wrote: post #31

oDot wrote: post #24

Earlier quoted context omitted.

It actually makes much more sense to use a uniform sales tax: (1) If you spend more, you're taxed more. Obviously this is better for poorer people, who spend less, but also for rich yet reserved people, who keep most of their money in the bank (which lends it) and are earning an income (=productive). Both will not penalized. (2) It's much hard to raise, because people will just stop buying stuff, which is much easier…

> rich yet reserved people, who keep most of their money in the bank (which lends it) and are earning an income (=productive) ... will not penalized. This goes against just about every standard defense of the ability to be rich: that rich people are job creators, that they power the economy by buying things, etc. Why should we discourage them from employing people and buying things? I don't want a loan (that needs to…

The standard defenses of the ability to be rich are persuasive arguments promulgated by those who are rich.

If we assume that the rich are, as other advertisers, rational and self-interested, the we should expect their messaging (i.e., the “standard defenses”) to be that which is most effective.

Something akin to if it works, it ships.

Consider that from the perspective of the accountants, every job created is a huge and ongoing liability and cost, and that from the perspective of the shareholders, every job created is stolen profit, money that is not returned in the form of equity appreciation + dividends.

Then you will begin to see the reality of the situation.