Seeing like a state, progress and poverty, and owning land
1–10 of 156 posts
Re: Seeing like a state, progress and poverty, and owning land
#2There was a post a couple of weeks ago on “second order thinking” from the
I think that this post points out an example of where “second order thinking” may be necessary or applicable.
Re: Seeing like a state, progress and poverty, and owning land
#3I'd like to better understand the concept of "unimproved land value" vs. "improvements".
For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can't pay the Georgist tax anymore and lose the land. And of course none of them can take the improvements they've made and transplant them somewhere else, it's just a total loss. Their own charity and neighborliness spelled their doom, even though they made the area attractive in the first place. What gives?
Re: Seeing like a state, progress and poverty, and owning land
#4I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
I see a different problem with the separation.
In the modern day, the improvements may contribute more than 100% of the value of the land. In most cases the sole benefit of having land in a desirable city is that it is near other desirable things. This is unlike the agricultural model motivating Georgism, where the primary benefit of owning land is that you can grow crops on it.
But taking the proposal literally that we can tax land based on the improvements existing on other nearby land, but not based on the improvements made to the same land being taxed... there is a very obvious implication. Land will end up being owned in such massive chunks that the land value tax goes back down to zero, because we subtract away the entire value of the area when calculating the tax.
Consider a small plot of land in Los Angeles. It's relatively close to Hollywood, and a lot of other nearby amenities. In its unimproved state, it's a swamp unfit for human habitation, but it is so advantageously located that we can attribute a lot of value to it anyway.
But if the same person owns the entire region of California around Los Angeles, its unimproved state is still an uninhabitable swamp... and because he owns the entire area, there are no improvements nearby to raise the value of the land to the point where he'd have to pay taxes on it. The film industry is an improvement to the land, which we don't want to tax. The port of Long Beach is an improvement to the land, which we don't want to tax. (There is not any fundamentals-based reason to locate a port there - it was constructed as a union-busting exercise, not because of geography.) The fact that millions of people live there is an improvement that we don't want to tax.
It makes no sense to base our tax assessments on how concentrated landownership is, but that is the Georgist proposal.
Re: Seeing like a state, progress and poverty, and owning land
#5I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
That's an interesting dilemma. I don't think Georgism fully solves the issue of returning community-created value to the community members who contributed to it. Of course the same is true under the current system for anyone who rents their residence.
I think the ideal outcome would be to just build additional housing for the people who want to move there, i.e. split the tax per unit land across more units of housing, since that's what the market is indicating that it "wants".
Of course most of the Anglophone world is doing a terrible job of adding housing in high-demand areas, and I'm not clear whether and how that would change under a Georgist regime.
Re: Seeing like a state, progress and poverty, and owning land
#6I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
There are some undefined variables. Did the people doing the improving own the land? Well, now they're no longer poor. Yay. Sell and get out of there before the Californians move in and turn it into a sewer.
If they voluntarily improved somebody else's land under no contractual agreement with the owner, why do they think they're entitled to a share of the new value?
If they voluntarily improved "public" land, good luck extracting gratitude from the state after the fact. The bureaucrats are more likely to issue fines and send in bulldozers.
Re: Seeing like a state, progress and poverty, and owning land
#7I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
I've always called this "state-to-state" income inequality, because it used to be that people from relatively wealthy states would "retire" (probably not actually retire) in lower income states because they can purchase a home with less friction.
Nowadays, the income inequality gap has grown drastically in each state, so I think this problem just falls under that umbrella. A good source: https://www.cbpp.org/blog/a-state-by-state-look-at-income-in...
Re: Seeing like a state, progress and poverty, and owning land
#8I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
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 without Georgist taxation, property taxes got too high to pay. I imagine a lot of folks in Texas and other less dense areas are going through this right now due to the rapidly increasing property values and less controlled changes in taxation.
It does cause change and turnover instead of stagnation in an area though.
Re: Seeing like a state, progress and poverty, and owning land
#9I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
I see a different problem with the separation. In the modern day, the improvements may contribute more than 100% of the value of the land. In most cases the sole benefit of having land in a desirable city is that it is near other desirable things. This is unlike the agricultural model motivating Georgism, where the primary benefit of owning land is that you can grow crops on it. But taking the proposal literally that…
Your issue is "what if someone owns huge chunks of land and doesn't try to make any money off it?" Then Hollywood gets built somewhere else where someone does want to make money. And eventually, those improvements may make the land the other person owns worth more money anyway and they'd be unable to pay the taxes.
Re: Seeing like a state, progress and poverty, and owning land
#10I'd like to better understand the concept of "unimproved land value" vs. "improvements". For example, let's say there's a neighborhood of people who are quite poor but charitable toward one another. So they build nice gardens accessible for free, little galleries, drinking fountains and so on. As a result, other people want to move in, land value in the community increases, and eventually the original inhabitants can…
There are some undefined variables. Did the people doing the improving own the land? Well, now they're no longer poor. Yay. Sell and get out of there before the Californians move in and turn it into a sewer. If they voluntarily improved somebody else's land under no contractual agreement with the owner, why do they think they're entitled to a share of the new value? If they voluntarily improved "public" land, good lu…
> If they voluntarily improved somebody else's land under no contractual agreement with the owner, why do they think they're entitled to a share of the new value?
> If they voluntarily improved "public" land, good luck extracting gratitude from the state after the fact. The bureaucrats are more likely to issue fines and send in bulldozers.
I wonder if this is a fringe example as I imagine few people are radically improving public land, esp. to such extent that it's causing a real estate rush. We might then go across not only the country but to other nations like Canada and ask what proportion of real estate booms are due to this scenario.