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Georgism

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Re: Georgism

#71

Post by moreaccountsplz »

alexmingoia wrote: post #25
JSavageOne wrote: post #17

I've yet to see a single valid objection as to why LVT (Land Value Tax) should not be the primary tax, yet it's nowhere to be found in the political dialogue. Such a shame that the majority of the tax burden instead falls on the working class while the landowners get a free ride.

Land value (like all value) is subjective. There is no inherent value to land. What one person is willing to pay is not the same for everyone. Appointing someone to imagine a price for the purposes of taxation doesn't change this fact.

There are ways to address value being subjective: use an incentive compatible revelation mechanism. E.g. http://radicalmarkets.com/chapters/property-is-monopoly/ where the property-owner appraises his own property, pays a fraction of his given value as a tax, and anyone can buy his property at the appraised price.

Whether it would be /accepted/ is another matter. But it's not impossible in the squaring-the-circle sense.

Re: Georgism

#72

Post by CydeWeys »

MiroF wrote: post #63
CydeWeys wrote: post #61

Earlier quoted context omitted.

> tech companies are a very small percentage of economic activity globally. This flat-out isn't true. Tech companies alone are a significant part of economic activity globally (e.g. they make up the majority of the top 10 largest companies in the world by market cap). Once you include all white collar work, which generally tends to be similarly divorced from land value, you're talking about the majority of the world…

> market cap Market cap doesn't measure economic activity. https://en.wikipedia.org/wiki/List_of_largest_companies_by_r... Look at this. Among the tech companies that are high, most of those are consumer electronics or something else not purely related to tech.

Sort by profit, not be revenue, and you see the tech companies appearing again. Profit (or even just total corporate spending) is a better measure of economic activity than revenue.

Re: Georgism

#73

Post by MiroF »

toohotatopic wrote: post #64
MiroF wrote: post #41

Earlier quoted context omitted.

> This assumes that the farmer has to remain a farmer. How does it assume that?

Otherwise it wouldn't be a monopoly and the farmer wouldn't have to accept the offer. The farmer, or rather, the human, can source resources from other markets and sell goods or services that don't depend on farmland. Once that happens, and nobody accepts the high price, the landlord has to lower the price until somebody accepts his offer.

The existence of substitutes doesn't make a monopoly no longer a monopoly.

Bell was still a telephone monopoly even if I could have used carrier pigeons instead.

Re: Georgism

#74

Post by CydeWeys »

NumberWangMan wrote: post #67

A lot of people focus on the fairness of the Land Value Tax, but the consequences of using one are just as interesting if not more. This tax has been put into practice in some cities in Pennsylvania, and there's evidence that it has a whole bunch of positive effects on the city, due to the way that it incentivises improving your property and making the most of your land (since you're going to be taxed on it pretty mu…

I sort of agree that replacing property taxes with land-value taxes would make sense, so long as you can actually do the value assessments fairly and impartially.

What doesn't remotely make sense to me is the suggestion that LVT should be the primary or even only tax, which you see others arguing for here in the comments.

Re: Georgism

#75

Post by tlholaday »

thechao wrote: post #52
nabla9 wrote: post #20

Earlier quoted context omitted.

There is brilliant way to solve it so that value and market-value meet. Keep the land always in market. It's called Common Ownership Self-Assessed Tax (COST). Land owner would self-assess the value of assets they possess, pay a tax on that value. The owner would be required to sell the asset to anyone willing to purchase them at this self-assessed price. If you value the land high for any reason and want to keep it,…

This is exactly how non-private copyright & patents should work. That is copyright/patent "for hire" would be COST, with the rate of taxation increasing by a small amount each year until tax rate was 100%. This would given Disney the ability to keep the mouse for 120 years, but also free up less lucrative works for public enjoyment.

What is the benefit of increasing the rate?

If you like 100 years of ownership, set the rate at 1% per year, calculated on the copyright/patent holder's self-assessed price. Every century, the polity collects 100% of the value. What the polity does with the money collected is up to the polity.

Re: Georgism

#76

Post by CydeWeys »

MiroF wrote: post #56
PeterisP wrote: post #49

Earlier quoted context omitted.

Some time ago wealth and production of wealth was heavily tied to land, agriculture and various natural resources were key to the wealth of a nation. This is not the case any more - only a tiny fraction of our economy is tied to the land, primary production (agriculture/forestry/fishing and mining including oil) is just a few percent of the total economy; real estate/rents/leasing is perhaps 15% but most of that is r…

"Land" for George is just things you can rent-seek on and are fixed in supply, that includes stuff like intellectual property, etc. > real estate/rents/leasing is perhaps 15% but most of that is related to the value of buildings, not the value of land. Not at all clear that most of that is related to the value of the building and also you conveniently neglect to mention that that is the largest share of GDP out of an…

How do you determine the value of intellectual property if not by looking at how much income is actually being derived from said IP? And at that point, don't you just have the same income-based corporate taxation that we already have, with extra steps?

Re: Georgism

#77

Post by bluecalm »

CydeWeys wrote: post #32
JSavageOne wrote: post #17

I've yet to see a single valid objection as to why LVT (Land Value Tax) should not be the primary tax, yet it's nowhere to be found in the political dialogue. Such a shame that the majority of the tax burden instead falls on the working class while the landowners get a free ride.

What tax should tech companies pay then, given that the only land they really need is cheap rural land for data centers? This taxation system does make sense for land, but there's way more economic activity happening that isn't associated with land than there is that is.

If they don't pay anything it's not really a problem. Their owners will and their employees will. Corporate income tax is the worst possible tax as it creates incentives for all the things at both don't want and which are very hard to police in a fair way (is this 1M they paid for licensing really a fair price or is it tax evasion?).

Re: Georgism

#78

Post by snidane »

PeterisP wrote: post #49
JSavageOne wrote: post #17

I've yet to see a single valid objection as to why LVT (Land Value Tax) should not be the primary tax, yet it's nowhere to be found in the political dialogue. Such a shame that the majority of the tax burden instead falls on the working class while the landowners get a free ride.

Some time ago wealth and production of wealth was heavily tied to land, agriculture and various natural resources were key to the wealth of a nation. This is not the case any more - only a tiny fraction of our economy is tied to the land, primary production (agriculture/forestry/fishing and mining including oil) is just a few percent of the total economy; real estate/rents/leasing is perhaps 15% but most of that is r…

Land is still necessary for production.

Maybe it will help to think of "land" as "location" since it is not the actual soil but the location which Georgists keep talking about.

If you are a modern services company you need to have access to large pool of qualified people - which happens to be in big cities. So you need a great location for your office to attract people from this talent pool. Location (aka land) therefore is an important input to your business and you will pay a lot for it.

Second, wealthy people park their money (regardless of origin, good or bad) in real estate. That drives living costs for non wealthy people.

It turns out it is non-wealthy workers who pay taxes which fund infrastructure development which benefits wealthy owners of real estate by increasing value of their property.

Georgists promote reversal of the present day funding scheme from nonwealthy workers to wealthy land owners with money parked in real estate. With the alternative being simple "taxing" of locational value to fund government services with two main outcomes

1. reducing tax burden on workers and small business 2. reducing cost of living (rents) by properly allocating land (mostly city land, not agricultural)

Re: Georgism

#79

Post by andrepd »

toohotatopic wrote: post #18
nabla9 wrote: post #12

Earlier quoted context omitted.

"The rent of land, therefore, considered as the price paid for the use of the land, is naturally a monopoly price. It is not at all proportioned to what the landlord may have laid out upon the improvement of the land, or to what he can afford to take; but to what the farmer can afford to give." — Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book I, Chapter XI "Of the Rent of Land"

This assumes that the farmer has to remain a farmer. This can be true for one generation, but the next generation can choose another profession. People don't become farmers if they have to pay too much.

That would be true in a perfect world with 0 impediments to social mobility. A socioeconomic "frictionless vaccum" of sorts. In the real world, social mobility is far from perfect.

Re: Georgism

#80

Post by MiroF »

CydeWeys wrote: post #72
MiroF wrote: post #63

Earlier quoted context omitted.

> market cap Market cap doesn't measure economic activity. https://en.wikipedia.org/wiki/List_of_largest_companies_by_r... Look at this. Among the tech companies that are high, most of those are consumer electronics or something else not purely related to tech.

Sort by profit, not be revenue, and you see the tech companies appearing again. Profit (or even just total corporate spending) is a better measure of economic activity than revenue.

> Profit (or even just total corporate spending) is a better measure of economic activity than revenue.

Profit is a terrible measure of economic activity because it is unrelated to the amount of goods changing hands. Indeed, in industries where lots and lots of goods change hands, profit is likely to be lower.

e: Also, real estate is extremely profitable, it's just not as consolidated as the major tech companies are.

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