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When you work for an hour, you increase society’s wealth (and your own) by an hour’s worth of wages. When you save a dollar rather than spending it, you increase society’s (and your own) wealth by a dollar. But when you buy a piece of land for $10,000 and sell it for $20,000, you haven’t increased the total wealth of society by a nickel. Yet the price of land keeps going up, up, up, as the population increases and society grows richer. Where does that money come from? It comes from the pockets of the other two factors of production, labor and capital. ...Henry George believed that the landlord’s share of wealth that all of us have helped to accumulate is inherently illegitimate and should be confiscated. He wouldn’t send in the National Guard to seize people’s property. He would instead confiscate the value of unimproved land—that is, land that had not been improved by, say, building on it—by taxing its annual value at a rate of 100 percent.“But,” you’re thinking, “that would make the property itself worthless.” (“That’s not what I’m thinking,” says Arianna, mysteriously.) Well, you’re right. Making the property worthless is the whole idea. Society gets the value of the property. Taxes on the other factors of production—labor and capital—can be reduced, or even eliminated. This is why people who are dedicated to promoting George’s ideas are known as “single-taxers.”The landlord will have little choice but to put the property to its “highest and best use.” ...But George got the main things right. Free markets are best (provided they are really free). A lot of markets that masquerade as free really aren’t. And we often tax the wrong things—ignoring wealth that accomplishes nothing while taxing labor and capital that are actually productive.
When you save a dollar rather than spending it, you increase society’s (and your own) wealth by a dollar.
Ppl don't own land today either. Not allodially as you seem to describing it.
People would not take title to land where the taxes could shoot up greatly.Example" Let's say some schmuck under this proposed Georgianism tax scheme bought a piece of property for $ 1 million when the interest rate was 5%. Let's say interest rates went down to roughly 2%. That would increase the value of the property by about $1 million so resulting in the tax of about $1 million. The schmuck would loose everything he ever owned due to this crap tax system.This system would lead to ownership by the benevolent State, under the best of circumstances. People would own nothing.
Why don't you check out how they do things in Pittsburgh, PA? They have a land value tax (tax on the land only, not improvements). IIRC, property value swings have been far lower in this city - a land value tax stabilizes real estate prices.
Let's say some schmuck under this proposed Georgianism tax scheme bought a piece of property for $ 1 million when the interest rate was 5%. Let's say interest rates went down to roughly 2%. That would increase the value of the property by about $1 million so resulting in the tax of about $1 million. The schmuck would loose everything he ever owned due to this crap tax system.
Example" Let's say some schmuck under this proposed Georgianism tax scheme bought a piece of property for $ 1 million when the interest rate was 5%. Let's say interest rates went down to roughly 2%. That would increase the value of the property by about $1 million so resulting in the tax of about $1 million. The schmuck would loose everything he ever owned due to this crap tax system.If true, it's no different than how current property taxes are reassessed for most localities.
Example" Let's say some schmuck under this proposed Georgianism tax scheme bought a piece of property for $ 1 million when the interest rate was 5%. Let's say interest rates went down to roughly 2%. That would increase the value of the property by about $1 million so resulting in the tax of about $1 million. The schmuck would loose everything he ever owned due to this crap tax system.
The point is that no one created land, therefore no one should be able to extract wealth from people who actually work simply by virtue of land ownership. All hereditary aristocracy is based on a class of people who don't have to work because they own the land and everyone else is therefore forced to work for them. Land ownership produces nothing at all.Please read the good explanations at:https://astralcodexten.substack.com/p/your-book-review-progress-and-poverty https://astralcodexten.substack.com/p/does-georgism-work-is-land-really https://astralcodexten.substack.com/p/does-georgism-work-part-2-can-landlords https://astralcodexten.substack.com/p/does-georgism-work-part-3-can-unimproved
The post-Corona economic environment puts a premium on finding fiscal means to stimulate the economy while continuing to finance current levels of expenditures and debt. We develop and carefully calibrate a model of the US economy to show that an increase in the tax rate on the value of land, balanced by decreases in the tax rates on the incomes of capital and labor, can meet this need. We find that the US share of land in total nonfinancial assets is more than 50%, so that the tax base is very large. This is corroborated by very high quality OECD data for other industrialized economies that, almost without exception, find land shares of between 40% and 60%. Our baseline proposed tax reform is an increase in the tax rate on the asset value of land from its current 0.55% to 5.55%, accompanied by reductions in tax rates on capital and labor incomes of 28 and 10 percentage points, respectively. In a representative household model, this increases welfare by 3.4% of steady state consumption, and increases output by almost 15% relative to trend. In an economy with separate groups of workers, capitalists and landlords, the output gain is the same, while the welfare gain increases to 6.4% on average across the three groups. Welfare and output gains for a wealth tax that raises the same revenue, and which increases the tax rates on capital and land equally, are only half as large as the baseline. Welfare and output gains for an optimal tax reform, under the assumption that the tax rate on the value of land is capped at 20%, are approximately twice as large as the baseline. This reform raises 55% of all tax revenue through land taxes, with the remaining 45% raised through consumption taxes, while all income taxes are abolished.
Hudson (2012, 2018) has shown that most land rent is paid out as interest to banks and that bank credit is a major driver of increases in housing prices (“real estate is worth whatever the bank will lend against it”). Further empirical support is offered by Favara and Imbs (2015), and La Cava (2015) finds that this can explain the increase in the share of housing in capital income studied by Rognlie (2015). Ryan-Collins et al. (2017) and Turner (2017) argue that a self-reinforcing cycle between bank lending and land value increases has caused a shift in bank lending from business loans to mortgages and the inflation of land prices, and this has impaired financial stability, as also argued in Keen (2017).
Put the Moxi, not Puny, in MUNIby David Giesen (info [at] TheCommonsSF.org)Thu, Jul 6, 2023 11:27PMThe progressive left hobbles itself in not believing the advocacy of socializing land values is worth the energy expended. Without a clear, principled aspiration articulated, a larger, wider, transformative social justice program is unlikely to emerge in public discourse, much less at the ballot.When one reads the editor-in-chief dismissing the value of San Francisco self-described left liberals taking the case for reforming the property tax to the public--and this is substantially what Tim Redmond said in a 48 Hills editorial Thursday, July 6--a cold gray city of defeatism and smug elitism guts the hopes and expectations of 3rd Street. I say smug elitism because not a few of those with a media or institutional platform in this city are sitting on Prop 13 suppressed land valuations that were they to take a principled position, would substantially raise their own taxes.Consuming the Earth affects everyone else's opportunity to use the Earth in making a livelihood. When I and a large cadre of fellow Americans hold title to a piece of land in the USA, that means a substantial cadre of fellow Americans have access to land for a home or a business or, for that matter, for recreation, only if the landless first pay my sort--the landowning--for access. Now it's true that commercial real estate titleholders hold sway over the huger part of land values in the US, but it's disingenuous for Redmond and others with thought-shaping platforms to pretend that when they, too, are titleholders of land, that their monopoly hold on the material universe doesn't skew towards a degree of desperation the lives of the whole population, but especially of the largely unlanded folk of 3rd Street (and their peers). The liberal democratic socialists (and the multi-astral constellation of other do-gooders) who hurrah revising Prop 13 so that commercial real estate would pay tax at MARKET valuation, but who conveniently excuse the home landowner from the equation, are simply not being principled in their thought. Consuming land, whether commercial real estate or not, alienates the rest of society from land. A principled position would be to require anyone enabled by land title to exclude others from use of that piece of the Earth, to pay the value of that exclusionary power to society.Turning to a related social question, the thought-swayers of self-professed Left persuasion do a poor job of making the case for small business when, in principle, they argue for taxes on productive activity, including doing business. To be sure, most Left voices specify that small businesses should be excused from tax levels meant to level incomes. Still, there is an implicit conviction amongst so many on the Left that the act of being productive in meeting consumer demand is suspicious. That conviction tries to hide behind the vague, dissembling mumble that there is an acceptable level of reward for meeting consumer demand, but that large aggregations of people into a corporation are, by dint of their scales of economy, receiving unjust amounts of reward for their efficiency. Yes, regulatory fees on doing business fall disproportionately heavily on small businesses than on large, but there is in the "Eat the Rich" sentiment a gross, careless understanding of from whence larger businesses gain their advantage over small businesses. It has to do with monopoly. Large businesses tend to own their real estate, and thus they internalize as income the differential in what they pay to use land and the location rent most small businesses must pay.Similarly, large businesses dependent upon natural resources are more often than small such businesses to own or control the price and access to such resources, whereas small businesses must pay the full market price for coal, petroleum, forest, coltan, and other resources. Redmond and fellow pundits (and these thought-shapers are mere pundits so long as they fail to rigorously explore first principles) take little if any account of the financial advantages of land value ownership that, I argue, account for so much bigger businesses' so-called profits. Socialize land values and then we can begin to discern whether doing business is ipso facto suspicious, or whether it is the customary monopoly on land access and land values that is what society should "eat."Don't take my word for it. Go yourself to five or six small business owners and ask them, "Do you find business taxes burdensome? Would you be better off and more able to compete with larger businesses if taxes fell not upon your earnings, but simply upon the location value your business occupies?" Many will say, "A tax on my location? I'm already paying my landlord for that." To which the principled response is, "That's right, and wouldn't it be desirable to have that portion of the rent you pay that pertains to location (as opposed to pertaining to the value of improvements) be the end of your tax due, with it collected by the landlord, but then passed along by him to the various government jurisdictions?"This is but a brief treatment of the unconsidered thinking of so many on the Left who would right significant social troubles with specious economic analysis. In the absence of rigorous reflection on the land question, we can expect the earnest voices of thought-swayers to accomplish near nothing in liberating the nation's 3rd Streets from alienation from place.By way of supplying one example of the power of correctly addressing the land question, I'll explain the title of this article. The United States, no doubt much to the surprise of most readers, has one of the most efficient public transport systems in the world. Tens of millions of people are safely and speedily conveyed to their destinations every year, and without a fare having to be paid! I refer to elevators in commercial buildings. The owners of buildings have a great incentive to make their piece of the Earth the site of an attractive destination. Whether its an apartment or condominium building, an office building, a retail store, etc., the commercial user of a piece of land seeks to optimize their income by making getting to destinations within their building easy. They do so by providing elevator service. Lay that elevator model perpendicular. Oblige the owners of land to pay in full for the annual value of that land, and they'll desire Euro or Asian quality public transportation to get consumers of the land owners' productive activity to their business sites. In other words, taxing away the full annual value of land will enable society to build horizontal fare-free public transportation with the same predictability that consumers expect to find vertical transportation in buildings.Socialized land values put moxi in MUNI. Sabe?For more information: http://www.thecommonssf.org/
Why can't I own a nuclear bomb?
People would own nothing.
richwicks saysWhy can't I own a nuclear bomb?
Why can't I own a nuclear bomb?Because you might set it off.
Federal government doesn't have any right to prevent me.
murder is NOT a federal offense
Federal government doesn't have any right to prevent me.So the state should do it. I don't think an individual should possess nuclear weapons. Too much can go wrong.
That is, whenever land is for sale, the land gets sold to whomever agrees to pay the highest annual land value tax for it.
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