I’ve since learned that overly online keyboard warriors are the least important people to convince. The most important people are on your local city council or state legislature. Furthermore, instead of wasting time with hard cases or elected officials who are dead-set against your ideas, you’re much better off finding and working with people who are already interested in your principles. This often means giving up on your own city or state, at least for the time being, and pursuing a “succeed anywhere” strategy instead.
We're about to have a board vote eliminating single-family zoning (I expect us to win) and this rings extremely true about local politics. If you count "votes" in Facebook comments --- Facebook is where all our local politics happen --- you'd think this is the most contentious issue in the world. But in our last mayoral election, you'd draw the same conclusion about the race being tight, and in fact the progressive rinsed the moderate by a huge margin.
The same thing is very true of public meetings; the turnout for comment at those things is almost never representative of the area's median sentiment. "No" turns out for everything; "yes" rarely does.
I spend a lot of time in online arguments with opponents, on the theory that I'm not really writing to the person I'm arguing with but rather to everyone quietly reading comments. But it's almost certainly the case that the only conversations that have really mattered have been with electeds themselves.
Which is maddening, given how much damage these existing policies are doing, and how many other zeitgeist issues (homelessness, affordability, robust economic growth etc) are downstream of this.
I wonder if this movement needs a form of performative extremism somewhere (think bridges being forcibly closed for causes), so that then the mainstream notices the sensible compromise and pushes for it. The YIMBY's have never played Overton Window games, but maybe they need to hold their nose and play it.
There's a lot here to absorb, but one thing I've always wondered about Georgism and Land Value Tax is whether land supply is actually inelastic:
> Land, however, is not built. Land is inelastic in supply, and landowners don’t “provide” land the way laborers provide labor and investors provide capital; they un-provide land by excluding others from using it. Building supply can change in response to a tax change, but land supply cannot.
But many cities actually can increase their land supply via land reclamation. This can be done by filling in waterways or otherwise altering the landscape to make it suitable to build on. Chicago, for example, built the Adler Planetarium by filling in rubble along the shore of Lake Michigan. Boston is an even more impressive example; Back Bay used to be a bay of the Atlantic Ocean, not an entire neighborhood of a city with very high cost of living.
Cities can also lose land. Sometimes this is due to natural causes like erosion, sea level rise, or disasters like earthquakes and volcanic eruptions. Other times a lack of regulation might permit pollution to make land unlivable or infeasible to build on. Land owners can't create natural disasters, but they can advocate for policies that strongly influence effective land supply, such as whether building codes allow building on certain kinds or soil or require resistance to earthquakes.
Does this change the calculus from a Georgist economic perspective? If not, why?
I think LVT does have a history in US, e.g Pittsburgh.
Also Georgism is 100% LVT -> A land tax alone has been the recommendation of many economists before and after George - From Smith, Riccardo, Mill to Friedman. Across classical, neoclassical, Keynesian, Austrian schools. If there's one thing economists can agree on, it's that land tax is better than income tax.
Random thought, would be it be good to extend land tax to use of all common public goods. E.g. radio frequencies, mining, water, CO2 pollution. Things you own, licensed or consume that take from the common good. Obviously this need constant tweaking E.g. as new tech makes different things valuable.
Yes, it's been suggested that all scarce inputs to the economy should be taxed. And yes the idea of Georgism is to let market set the prices and tax based off of that.
It does become complicated when the scarce inputs are things like highly specialized labor. Georgism wouldn't tax that monopoly, though our current systems (progressive income taxes) do. Many people would want a system which penalizes businesses for buying up e.g. all the veterinarians in a city and charging monopoly prices.
Other replies supporting taxing externalities and scarce resources are correct, but it can be generalized as taxing undesirable behavior to disincentivize it.
The good news is that as different things become valuable their value changes, I guess? So if radio frequency stops being useful, the LVT put on it also drops pretty hard.
The bad news is now you have to assess the value of a lot more things in order to do this (the value of clean waterways in a certain state, the value of IP taken away from the common culture) that may not have a direct market value.
How does one even put a direct financial value on clean water, clean air, lack of noise pollution, etc.?
These things have different values to different people. While most everyone wants them in some form, there is a huge spectrum between “it won’t kill me this month” and “living in pristine Mt. Fuji”.
Should private companies be allowed to pollute sparse remote areas with no population?
Does it have a financial value if nobody goes there?
There was also a community in the deep south. And I once read a case study about a town that tried it in, IIRC, New Mexico.
Full LVT never works. It always ends up shot through with exceptions and loopholes and, in the case study, inducing corruption. And it's all predictable, too, if you know anything about taxation policy and American political culture. For full LVT you'd need to start from a blank slate, not just from a legal perspective but from people's expectations about property ownership.
The fact that economically right wing economists like Milton Friedman supported LVT is a great argument against landlord type labelling LVT as far-left and attempting to push the idea outside the Overton window.
I think the only valid argument against is it is that a significant LVT would punish those who've worked for their wealth as they've already paid significant income tax. But there are plenty of ways to introduce it gradually. Other arguments boil down to vested interests when I dig into it.
It's the tax with the most positive impact AFAIK, especially when the other taxes are removed or at least adjusted accordingly.
But it probably is also a cooperation problem, thus we prefer a slow but accelerating apocalypse.
All these graduates need some value from their education after all, and if we reduce doing actively harmful things like the current tax system, others will be superior to us by transforming resources more quickly into waste.
Since the latter process is extremely profitable, and again, so many people have education in optimizing the resources->money->waste pipeline, it would be a luddite and anti-science thought to listen to the science and stop this.
Apart from that, there's a very common and profitable way of getting yield from people's everyday life while also rewarding them: cars.
Live somewhere, but everything you do requires a vehicle.
You'll see so many beautiful places.
But you also have to rant about the evil urban population that pays for your car, gas, roads, parking space and special subsidies.
It would be unlivable out there in the wilderness without this totally natural subsidization.
You can say that land tax might be better than income tax but it's hard to argue that both land tax and income tax is better than just income tax. This is the biggest reason why new tax modalities are considered unworkable.
We already have property tax + income tax, and property tax is land value + value of improvements. From TFA, the immediate proposal is just allowing the property tax to assess the land value and value of improvements at two different rates, with the rate on improvements decreasing to remove incentives against improvements.
This presupposes a balancing, when in reality it only ever goes up, and when it goes down it leads to lapses in services where the bill comes due later, with interest
Unfortunately, most of the political changes that I want to see go against some special interest. Examples include liberalizing professional licensing, reducing medical paternalism, and streamlining the litigation system. I can think of a zillion ways to do this, but every one of them cuts out some toll booth with concentrated benefits and diffuse costs, and our political system is not capable of dealing with such things in a reasonable way.
I am very open to be told strategies to fight this more effectively without becoming a full time career activist for years on end for one issue at a time.
I guess here's an issue. I bought 13 acres - mostly because I hate hearing basketballs bouncing, other people's TVs, and "boom cars".
So if we're going to start taxing me at a million per year, can I start taxing those loud people a million a year so I can live in the city to pay for medical bills for my brain to go through the bouncing basketball.
Mind you, everyone else in my area has 10 - 15 acres and it's just a dead area. Just people that ran away from the city. There's absolutely no "value" in this land as no one wants to even be here and drive 40 minutes to get to a grocery store.
Then your land would likely be priced at the nominal amount per acre x 13 since the demand for that area is low and diffuse. Not a horrible outcome, and, could encourage you to make the land "productive" to at least cover the tax. Tree farms are lovely.
What about conservation? On my land, after clearing a bit around the house for fire safety and "pest" prevention, I kept most of the native rainforest. I planted a few syntropic lines of fruit trees, but they cannot cover the land tax I already pay. All my gardening and land management at large is a money sink (unless we consider touching grass an investment).
Isn't the idea that it's a land value tax, and not just a land tax. The land in your example is not particularly valuable. Unless I have misunderstood the idea.
The LVT seems to me to be a lot like a carbon tax: a wonderful technocratic idea that is politically untenable. LTV would be great for humanity, but very bad for present homeowners. Since homeowners are wealthy and thus more politically engaged on average, I just don’t see how this could ever get passed. Instead of starting with an impossible task, why not start instead with a merely incredibly unlikely task: repeal proposition 13.
I’ve since learned that overly online keyboard warriors are the least important people to convince. The most important people are on your local city council or state legislature. Furthermore, instead of wasting time with hard cases or elected officials who are dead-set against your ideas, you’re much better off finding and working with people who are already interested in your principles. This often means giving up on your own city or state, at least for the time being, and pursuing a “succeed anywhere” strategy instead.
We're about to have a board vote eliminating single-family zoning (I expect us to win) and this rings extremely true about local politics. If you count "votes" in Facebook comments --- Facebook is where all our local politics happen --- you'd think this is the most contentious issue in the world. But in our last mayoral election, you'd draw the same conclusion about the race being tight, and in fact the progressive rinsed the moderate by a huge margin.
The same thing is very true of public meetings; the turnout for comment at those things is almost never representative of the area's median sentiment. "No" turns out for everything; "yes" rarely does.
I spend a lot of time in online arguments with opponents, on the theory that I'm not really writing to the person I'm arguing with but rather to everyone quietly reading comments. But it's almost certainly the case that the only conversations that have really mattered have been with electeds themselves.
Which is maddening, given how much damage these existing policies are doing, and how many other zeitgeist issues (homelessness, affordability, robust economic growth etc) are downstream of this.
I wonder if this movement needs a form of performative extremism somewhere (think bridges being forcibly closed for causes), so that then the mainstream notices the sensible compromise and pushes for it. The YIMBY's have never played Overton Window games, but maybe they need to hold their nose and play it.
There's a lot here to absorb, but one thing I've always wondered about Georgism and Land Value Tax is whether land supply is actually inelastic:
> Land, however, is not built. Land is inelastic in supply, and landowners don’t “provide” land the way laborers provide labor and investors provide capital; they un-provide land by excluding others from using it. Building supply can change in response to a tax change, but land supply cannot.
But many cities actually can increase their land supply via land reclamation. This can be done by filling in waterways or otherwise altering the landscape to make it suitable to build on. Chicago, for example, built the Adler Planetarium by filling in rubble along the shore of Lake Michigan. Boston is an even more impressive example; Back Bay used to be a bay of the Atlantic Ocean, not an entire neighborhood of a city with very high cost of living.
Cities can also lose land. Sometimes this is due to natural causes like erosion, sea level rise, or disasters like earthquakes and volcanic eruptions. Other times a lack of regulation might permit pollution to make land unlivable or infeasible to build on. Land owners can't create natural disasters, but they can advocate for policies that strongly influence effective land supply, such as whether building codes allow building on certain kinds or soil or require resistance to earthquakes.
Does this change the calculus from a Georgist economic perspective? If not, why?
I think LVT does have a history in US, e.g Pittsburgh.
Also Georgism is 100% LVT -> A land tax alone has been the recommendation of many economists before and after George - From Smith, Riccardo, Mill to Friedman. Across classical, neoclassical, Keynesian, Austrian schools. If there's one thing economists can agree on, it's that land tax is better than income tax.
Random thought, would be it be good to extend land tax to use of all common public goods. E.g. radio frequencies, mining, water, CO2 pollution. Things you own, licensed or consume that take from the common good. Obviously this need constant tweaking E.g. as new tech makes different things valuable.
Yes, it's been suggested that all scarce inputs to the economy should be taxed. And yes the idea of Georgism is to let market set the prices and tax based off of that.
It does become complicated when the scarce inputs are things like highly specialized labor. Georgism wouldn't tax that monopoly, though our current systems (progressive income taxes) do. Many people would want a system which penalizes businesses for buying up e.g. all the veterinarians in a city and charging monopoly prices.
> Many people would want a system which penalizes businesses for buying up e.g. all the veterinarians in a city and charging monopoly prices.
As powerful as taxes are to create change, you don't need to use them to solve every problem out there.
Other replies supporting taxing externalities and scarce resources are correct, but it can be generalized as taxing undesirable behavior to disincentivize it.
The good news is that as different things become valuable their value changes, I guess? So if radio frequency stops being useful, the LVT put on it also drops pretty hard.
The bad news is now you have to assess the value of a lot more things in order to do this (the value of clean waterways in a certain state, the value of IP taken away from the common culture) that may not have a direct market value.
How does one even put a direct financial value on clean water, clean air, lack of noise pollution, etc.?
These things have different values to different people. While most everyone wants them in some form, there is a huge spectrum between “it won’t kill me this month” and “living in pristine Mt. Fuji”.
Should private companies be allowed to pollute sparse remote areas with no population?
Does it have a financial value if nobody goes there?
Yes, pricing negative externalities is a good idea. Unfortunately some are more or less expensive to price/enforce
There was also a community in the deep south. And I once read a case study about a town that tried it in, IIRC, New Mexico.
Full LVT never works. It always ends up shot through with exceptions and loopholes and, in the case study, inducing corruption. And it's all predictable, too, if you know anything about taxation policy and American political culture. For full LVT you'd need to start from a blank slate, not just from a legal perspective but from people's expectations about property ownership.
The fact that economically right wing economists like Milton Friedman supported LVT is a great argument against landlord type labelling LVT as far-left and attempting to push the idea outside the Overton window. I think the only valid argument against is it is that a significant LVT would punish those who've worked for their wealth as they've already paid significant income tax. But there are plenty of ways to introduce it gradually. Other arguments boil down to vested interests when I dig into it.
It's the tax with the most positive impact AFAIK, especially when the other taxes are removed or at least adjusted accordingly.
But it probably is also a cooperation problem, thus we prefer a slow but accelerating apocalypse.
All these graduates need some value from their education after all, and if we reduce doing actively harmful things like the current tax system, others will be superior to us by transforming resources more quickly into waste.
Since the latter process is extremely profitable, and again, so many people have education in optimizing the resources->money->waste pipeline, it would be a luddite and anti-science thought to listen to the science and stop this.
Apart from that, there's a very common and profitable way of getting yield from people's everyday life while also rewarding them: cars.
Live somewhere, but everything you do requires a vehicle.
You'll see so many beautiful places.
But you also have to rant about the evil urban population that pays for your car, gas, roads, parking space and special subsidies.
It would be unlivable out there in the wilderness without this totally natural subsidization.
You can say that land tax might be better than income tax but it's hard to argue that both land tax and income tax is better than just income tax. This is the biggest reason why new tax modalities are considered unworkable.
We already have property tax + income tax, and property tax is land value + value of improvements. From TFA, the immediate proposal is just allowing the property tax to assess the land value and value of improvements at two different rates, with the rate on improvements decreasing to remove incentives against improvements.
I think land + income is better. It's what I have where I live, and I'd like to see the balance shifted more towards land.
This presupposes a balancing, when in reality it only ever goes up, and when it goes down it leads to lapses in services where the bill comes due later, with interest
"Doing policymaker's work for them" is something like 80% of lobbying.
If you have something you want done in your town, and you come with the work done AND not asking for funding, you're likely to get it.
If you come with the work done and a PLAN for getting the funding, you also have a good chance of success.
Unfortunately, most of the political changes that I want to see go against some special interest. Examples include liberalizing professional licensing, reducing medical paternalism, and streamlining the litigation system. I can think of a zillion ways to do this, but every one of them cuts out some toll booth with concentrated benefits and diffuse costs, and our political system is not capable of dealing with such things in a reasonable way.
I am very open to be told strategies to fight this more effectively without becoming a full time career activist for years on end for one issue at a time.
Eh... After finishing the article, did I miss the section where the author discuss if Georgism actually works?
Did it actually increase the amount of housing? Reduce wealth disparity? Got enough taxes so cities can make commutes better?
[delayed]
I guess here's an issue. I bought 13 acres - mostly because I hate hearing basketballs bouncing, other people's TVs, and "boom cars".
So if we're going to start taxing me at a million per year, can I start taxing those loud people a million a year so I can live in the city to pay for medical bills for my brain to go through the bouncing basketball.
Mind you, everyone else in my area has 10 - 15 acres and it's just a dead area. Just people that ran away from the city. There's absolutely no "value" in this land as no one wants to even be here and drive 40 minutes to get to a grocery store.
LVT is assessed on land value. Your 13 rural acres aren't insanely valuable and would not be assessed a million dollars a year under a Georgian model.
Ok, that makes sense to me then. I thought I was going to be taxed for unused land.
Then your land would likely be priced at the nominal amount per acre x 13 since the demand for that area is low and diffuse. Not a horrible outcome, and, could encourage you to make the land "productive" to at least cover the tax. Tree farms are lovely.
What about conservation? On my land, after clearing a bit around the house for fire safety and "pest" prevention, I kept most of the native rainforest. I planted a few syntropic lines of fruit trees, but they cannot cover the land tax I already pay. All my gardening and land management at large is a money sink (unless we consider touching grass an investment).
Isn't the idea that it's a land value tax, and not just a land tax. The land in your example is not particularly valuable. Unless I have misunderstood the idea.
The LVT seems to me to be a lot like a carbon tax: a wonderful technocratic idea that is politically untenable. LTV would be great for humanity, but very bad for present homeowners. Since homeowners are wealthy and thus more politically engaged on average, I just don’t see how this could ever get passed. Instead of starting with an impossible task, why not start instead with a merely incredibly unlikely task: repeal proposition 13.