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Letter from a Young Distributist: Georgism and Distributism

progressandpoverty.substack.com

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Re: Letter from a Young Distributist: Georgism and Distributism

#51

Post by brightly-salty »

clairity wrote: post #45
geocon wrote: post #36

Earlier quoted context omitted.

One of the nice things about LVT is that it aligns those incentives though, since what increases tax revenue the most is investment in public infrastructure and services. It's the Henry George Theorem at work: https://en.wikipedia.org/wiki/Henry_George_theorem

that's assuming politicians are compelled at least a little bit by the public good. unfortunately, our politico-economic systems have become more and more captured by moneyed interests, insulating politicians from those wider incentives. but to be fair, that's not unique to georgism. we need to solve for that problem generally.

I think it would be at least partially solved by reorganizing government to be based upon subsidiarity :) but yes, this isn’t necessarily a question which political economy can or should solve

Re: Letter from a Young Distributist: Georgism and Distributism

#53

Post by TimPC »

geocon wrote: post #34
Aunche wrote: post #25

Earlier quoted context omitted.

I think to start with, we can end prop 13 and fix whatever loopholes that allow billionaire's row penthouses to be taxed a lower rate than regular apartments.

Yeah there are lots of small reforms that can be done: transitioning property taxes to land value taxes, ending property tax caps like prop 13 that just allow landowners to extract rents, putting in place land value capture for public transit, and so forth

Can you make a strong case for transitioning just property taxes to land value taxes without transitioning other forms of taxation? I'd argue that this would result in a fairly sizeable wealth transfer from homeowners to condo developers. To me it feels like the decrease in sales and income taxes underpins the whole structure to make it feasible for the average American.

Re: Letter from a Young Distributist: Georgism and Distributism

#54

Post by goodpoint »

TimPC wrote: post #4

Georgism and Distributism is interesting but short of a plan to actually transition the tax infrastructure in that direction this article reduces to an unactionable history lesson. Still worth reading, but not powerful enough for those who want economic change. I'd argue that transitioning is an extremely hard problem. The Georgist system taxes property at extreme rates. In particular, the taxes on property ownership…

> I'd argue that transitioning is an extremely hard problem. The Georgist system taxes property at extreme rates.

Forgive the naive suggestion, but tax rates on property can be be introduced progressively - few percentage points per year - for many decades.

Re: Letter from a Young Distributist: Georgism and Distributism

#55

Post by geocon »

TimPC wrote: post #53
geocon wrote: post #34

Earlier quoted context omitted.

Yeah there are lots of small reforms that can be done: transitioning property taxes to land value taxes, ending property tax caps like prop 13 that just allow landowners to extract rents, putting in place land value capture for public transit, and so forth

Can you make a strong case for transitioning just property taxes to land value taxes without transitioning other forms of taxation? I'd argue that this would result in a fairly sizeable wealth transfer from homeowners to condo developers. To me it feels like the decrease in sales and income taxes underpins the whole structure to make it feasible for the average American.

I think you have a mistaken view of who is actually making money in this equation. Developers do not make all that much money from building housing, which is actually a productive contribution to society. Homeowners, on the other hand, make hand over fist by simply sitting on land absorbing rents: https://pbs.twimg.com/media/EyJN_g3UUAIW0f0?format=jpg&name=...

https://www.wsj.com/articles/homes-earned-more-for-owners-th...

Re: Letter from a Young Distributist: Georgism and Distributism

#56

Post by geocon »

TimPC wrote: post #44
larsiusprime wrote: post #41

Earlier quoted context omitted.

Two things: 1) "In particular, the taxes on property ownership are supposed to capture the entire value of renting the property." Not true. Only the unimproved value of land is meant to be taxed. This amounts to a complete exemption on taxes on buildings. The current proposal that is often on the table is not to go for classical 100% Georgist LVT, but to simply collect the exact same amount of property taxes we do no…

My default reaction to 1) is that I dislike it. I feel like the incentive to labour to accept the tax of unimproved land value instead of property tax is the removal of income and sales taxes that accompany it. Taxing unimproved land value instead of improved land value in a system as close as possible to the current one feels like a massive wealth transfer from homeowners to condo developers. As it is, condos repres…

I think you have a mistaken view of who is actually making money in this equation. Developers do not make all that much money from building housing, which is actually a productive contribution to society. Homeowners, on the other hand, make hand over fist by simply sitting on land absorbing rents: https://pbs.twimg.com/media/EyJN_g3UUAIW0f0?format=jpg&name=...

https://www.wsj.com/articles/homes-earned-more-for-owners-th...

Secondly, suburbs are drastically subsidized by denser development. They resist densification because they don't want to pay their fair share. https://www.strongtowns.org/journal/2020/4/16/when-apartment...

Re: Letter from a Young Distributist: Georgism and Distributism

#57

Post by geocon »

TimPC wrote: post #50
lukifer wrote: post #10

Earlier quoted context omitted.

> I'd argue that transitioning is an extremely hard problem. While you're completely correct, I don't think this is a reason to abandon the enterprise (other extremely hard problems: sending a human safely to the moon; democratic rule of law; the elimination of slavery). While I ideologically support the so-called "Single Tax" model, it is indeed extremely difficult to imagine how this would be implemented at the fed…

I'm hesitant to implement locally without changes at larger levels. I feel like the system depends in a fundamental way on the removal of sales and income taxes on individuals to account for the increase in taxation for less improved land. Without the changes in the other forms of taxation I feel the change in property tax amounts to a wealth transfer from homeowners to condo developers.

I think you have a mistaken view of who is actually making money in this equation. Developers do not make all that much money from building housing, which is actually a productive contribution to society. Homeowners, on the other hand, make hand over fist by simply sitting on land absorbing rents: https://pbs.twimg.com/media/EyJN_g3UUAIW0f0?format=jpg&name=...

https://www.wsj.com/articles/homes-earned-more-for-owners-th...

Re: Letter from a Young Distributist: Georgism and Distributism

#58

Post by TimPC »

geocon wrote: post #56
TimPC wrote: post #44

Earlier quoted context omitted.

My default reaction to 1) is that I dislike it. I feel like the incentive to labour to accept the tax of unimproved land value instead of property tax is the removal of income and sales taxes that accompany it. Taxing unimproved land value instead of improved land value in a system as close as possible to the current one feels like a massive wealth transfer from homeowners to condo developers. As it is, condos repres…

I think you have a mistaken view of who is actually making money in this equation. Developers do not make all that much money from building housing, which is actually a productive contribution to society. Homeowners, on the other hand, make hand over fist by simply sitting on land absorbing rents: https://pbs.twimg.com/media/EyJN_g3UUAIW0f0?format=jpg&name=... https://www.wsj.com/articles/homes-earned-more-for-owners…

I think it's misleading to measure things in revenue per square foot. Most government services aren't provided based on the number of square feet but rather based on the number of people. The per capita revenue for denser developments is lower than the per capita revenue for single family housing. When you get to rural densities you have issues of providing services because of the lack of scale of communities but suburbs are generally dense enough to afford services like police, fire, community centres and hospitals.

Re: Letter from a Young Distributist: Georgism and Distributism

#59

Post by Barrin92 »

Central problem with these kinds of systems of thought is actually hinted at in the piece itself

>"While Georgism does not have a philosophy of governance, it can easily be harmonized with distributist ideals. In many governments today, especially the United States, there is a substantial bureaucracy which creates red tape rather than solving problems"

Georgism and similar economic ideas that favor localism have no theory of governance or of power. You can imagine a G.K. Chesterton style economy where we all live in a sort of Catholic Hobbingen of family owned businesses or Le Guin's Anarres, but there's a reason we're not living in it now.

Without having a theory of administration, that is to say bureaucracy and governance and how to beat all those big companies and actors that ruin your distributist dreams into submission, you have a considerable problem. There is no such thing as 'naturally limited government'. That these systems do not magically sustain themselves is visible in Europe with the decline of Christian- and Social-Democracy respectively whose economic and cultural foundations (largely Catholic/neo-Calvinist social teaching) started to break apart.

Re: Letter from a Young Distributist: Georgism and Distributism

#60

Post by pyradius »

geocon wrote: post #56
TimPC wrote: post #44

Earlier quoted context omitted.

My default reaction to 1) is that I dislike it. I feel like the incentive to labour to accept the tax of unimproved land value instead of property tax is the removal of income and sales taxes that accompany it. Taxing unimproved land value instead of improved land value in a system as close as possible to the current one feels like a massive wealth transfer from homeowners to condo developers. As it is, condos repres…

I think you have a mistaken view of who is actually making money in this equation. Developers do not make all that much money from building housing, which is actually a productive contribution to society. Homeowners, on the other hand, make hand over fist by simply sitting on land absorbing rents: https://pbs.twimg.com/media/EyJN_g3UUAIW0f0?format=jpg&name=... https://www.wsj.com/articles/homes-earned-more-for-owners…

Yep the suburbs are a money-loser for governments as noted in https://www.youtube.com/watch?v=7Nw6qyyrTeI
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