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, pricing negative externalities is a good idea. Unfortunately some are more or less expensive to price/enforce

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.

Georgism is not about scarcity, it's about economic land: inputs to production which are fixed in quantity, and that you can't make more of. This is a very different characteristic than scarcity, because many scarce things can be increased, and should be if they are needed.

Taxing specialized labor goes against that spirit, because specialized labor can be created. And in fact taxing the labor would result in less of it being there, the exact opposite of the optimal result.

Yes, the right generalization of Georgism is the taxation of economic rent in its various forms - something which George himself opposed.

> something which George himself opposed.

Do you have a source on this?

> economic rent

What's the definition of this term?

Basically money you make by owning some legal right rather than by doing something productive

> Georgism is not about scarcity, it's about economic land: inputs to production which are fixed in quantity, and that you can't make more of.

I think people get tripped up on this specifically because a growing demand for something with fixed/inelastic supply will naturally tend to cause that thing to become scarce given enough time, and it's that scarcity as applied to land that's making Georgism look more and more like a good idea.

Doesn’t the veterinarian own their own skills, after having spent decades in school to learn them (and perhaps being saddled with student loans to do so?)

What if they just moved? Or should we have US-style global taxes following them around even then?

> 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.

Monopoly busting doesn't need to be solved by the tax system, right? Isn't that a separate issue?

Although, maintaining a monopoly by owning land becomes more difficult with a LVT. It theoretically becomes easier for a new vet to find a place and setup shop in the city, and then the Monopoly is busted.

Randall Wray frames this as “tax bads not goods”. In other words: don’t tax payroll, we want companies to hire. Don’t tax labour: we want people to work. Don’t tax company profits: we want profitable companies. DO tax pollution. DO tax interest income: we don’t want people to get money for doing nothing. DO tax resource usage. If your houses are too big tax house volume. If your land is being banked tax vacancy and so on.

Interest income is not taxed under Georgism btw, except for income on land speculation.

If you buy company x, restructure the business, start turning a profit, then sell the company -> that income (capital gains under current system) is untaxed in Georgism

If you buy an empty lot, wait 10 years to sell it to someone at a higher price, then all that profit is taxed (before it is realized too).

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?

I mean — valuing things is not always that hard: how much are you willing to take to go without?

Other replies supporting taxing externalities and scarce resources are correct, but it can be generalized as taxing undesirable behavior to disincentivize it.

The generalization I would use is that governments should tax any scarce resource based on the amount of revenue it should produce if used effectively, rather than the revenue a given consumer can actually produces. Whether that is land, radio spectrum, or clean air.

“Undesirable behavior” is overly broad to the point of being actively misleading, and gets you into sin taxes. smut or drugs are not the scarce resources anybody is talking about here.

But that is what the land tax folks are doing. They want dense cities and transit. They tax the "undesirable behavior" i.e. parking lots and lower density usage.

Not misleading. Rent-seeking is an undesirable behavior, and it's the primary behavior a land value tax targets. Hoarding limited resources is an undesirable behavior. Making products that have negative environmental impacts is an undesirable behavior.

You're kind of describing two different ideas: pigouvian taxes, and taxing The Commons.

What both have in common is that economists from all different schools of thought widely agree that they're the least distortionary taxes.

This is Norway's approach with Hydropower and Petroleum: https://blog.landeconomics.org/p/book-review-the-natural-div...

Here in Germany there was a bidding frenzy for 3G frequencies. The end result was simply that 3G was more expensive than in other countries and reception was worse.

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 have to pay the government rent in perpetuity.

You are paying the government rent in perpetuity for the services they provide, including enforcement of your property rights. If you wish to live on land without paying government rent, you will need to go to a place without effective government. Today, that would be Syria, parts of Sudan, or Mali as examples. I doubt you want to live in those places as a 1st world resident, but if you do, there's little stopping you.

It’s exactly the correct idea. If the value of your land rises as a positive externality, it only makes sense that you contribute some of that back to the society that effected the rise in the first place.

No it doesn't. You haven't realized any gains, therefore it's not just to tax you on that.

Vast majority are realizing their gains as rent. A land tax would just be taxing those gains before they can be recycled into the real-estate market. Perfectly just in that case.

If you're talking about an individual not using the land commercially - well theoretically the tax burden lowers the sale price. You don't pay both. At 100% land tax, the sale price would be zero. You pay only as you use the land. That also seems just to me.

Well I have news for you… governments are coming for unrealized gains, they will not care if the money is on hand, they’ll fire sell your property if you don’t get a loan to pay the taxes. It’s a mathematical inevitability. And by that I mean governments are going broke and will try to find ever more creative ways to raise money, and unrealized gains, tax normalization, is one of the bigger leavers.

Where I live, the government owns about 40% of the value of my labour. I have to rent my own body in perpetuity. Meanwhile my second biggest expense is a mortgage I pay for land that nobody created.

How much of the land value of your country do you currently own? A land value tax is likely to increase the amount of land you own (the profits of). I don't think US tracks land values as accurately as countries with some kind of land tax.

The alternative is unbounded compounding of wealth until all land is held by very few hands.

Paying taxes in perpetuity is what pretty much everyone does.

Not necessarily. It can be arranged so for owners with no income the tax accrues to the land and no cashflow is necessary until sale.

California and at least ten other states have programs for the elderly to defer paying property tax on their homestead and the heirs pay it.

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.

An analogy just occurred to me. Imagine an income tax not on what you currently earn, but on what you could earn given your schooling, credentials, experience, etc, and the available jobs within your region. Imagine how utterly unfair people would feel about that, and how quickly such a scheme would fall to widespread political pressure.

I get why an LVT makes sense from an economic perspective, but in practice it feels nearly as unfair as the above. Residents especially, but small and medium sized businesses would very quickly lobby to eviscerate an LVT. Imagine long-time residents getting kicked out not because a developer wants to make buck, but because the tax system requires that to happen. There's zero chance such a scheme could survive intact politically. In Pittsburg it's an LVT in name only, with a long list of exceptions and curious appraisals. And once it's applied ad hoc, which it must, there's all manner of distortions and incentives for corruption.

There are many ways for land use and tax policy to improve, but you have to come at from the perspective of improving the existing system, not revolutionizing it with an LVT. And you could probably get closer to an LVT by smart incremental reform than you could by trying to nominally pursue an LVT.

>Imagine long-time residents getting kicked out not because a developer wants to make buck, but because the tax system requires that to happen.

Some of us think that would be a good thing. My elderly neighbour has been living on her own in a five bedroom house for twenty five years meanwhile there are people nearby struggling to raise a family in one or two bedroom houses. She doesn't need that house, she is just there out of inertia. Letting the tax system nudge people in the right direction is a good thing.

> she doesn't need that house

Ick.

Georgists would say that if some corporation built Disneyland next door, I no longer deserve to live there. How am I to compete with the vast productivity of a massive corporation?

Where do I deserve to live then? Only where my productivity matches the economic bar of those around me?

I'm getting old and tired. Am I only allowed in a retirement home?

On the contrary, Georgists would say that if some corporation built Disneyland next door, they have to compensate the local community for their use of that valuable land. Local homeowners have to do the exact same thing, but a single home would pay vastly less tax compared to the much more expansive Disneyland. So even the homeowners would marginally benefit in that scenario. Land is always valued according to the potential highest and best use, so the fact that a Disneyland may or may not have been built in any specific location matters less than one might expect.

To an economist, the highest and best use of the land around disneyland is not my home. It's not housing. It's hotels, motels, restaurants. So my land would now be taxed at that rate, until I'm forced out

For devil's advocate's sake, how is this not state sponsored gentrification?

The problem economists would point out is that this is a fully general argument against any development. Which is exactly what leads to the negative side of gentrification - people eventually being forced out of their communities, because there's way too little developed real estate and the rent is too damn high. Georgism lowers rents by pushing towards the highest and best use of land, which is the anti-gentrification move.

In your specific example, you shouldn't assume that the supposed change in the "highest and best use" will be enough to price you out if you're a typical homeowner (not a vulnerable renter in a sharply gentrifying area): the numbers don't really pencil out that way. High land values exist in some places, but they're quite rare and quite concentrated.

The solution to this is to use that LVT revenue to fund UBI, such that the income from all that Disneyland-related land value offsets your own LVT burden.

In a mathematically-perfect setup (100% LVT going entirely to UBI, with zero overhead and zero other government expenditures), the break-even point where your LVT exactly equals your UBI would mean that you own your exact equal share of that tax jurisdiction's total land value; if you own more, then you pay for it, and if you own less, then you get paid for it. Obviously in the real world some of that LVT revenue has to go toward paying people to collect taxes / distribute income checks (not to mention the many other functions of a typical government), but the point is that LVT+UBI produces a self-balancing system that maximizes fairness even for people using their land “non-productively”.

> Imagine an income tax not on what you currently earn, but on what you could earn given your schooling, credentials, experience, etc, and the available jobs within your region. Imagine how utterly unfair people would feel about that, and how quickly such a scheme would fall to widespread political pressure.

Yep, great analogy. LVT is the optimum tax from the point of view of maximising production incentives, but actually practical ways of extracting significant revenues from people tend to skew towards "this person/organization has liquid funds available and wants to do something enough to pay the tax on top". (For related reasons LVT-style approaches to taxation work rather well when the finite resource being taxed is something like broadcast spectrums which the average person doesn't own)

As for Single Taxing, convincing the public theres some ethical principle that PE funds buying tech stocks deserve to keep all of the rewards for risking their money on a particular venture and homeowners who lived through the area's dodgy-reputation years don't is a complete non-starter even though anyone with an economics degree can tell you why such an argument might be made...

Not sure if you realize this, but most businesses and nearly half of residents pay exactly such a tax. It's called 'rent' and is based on a 'market rate' which is exactly the amount that could be earned. They get kicked out all the time! That's actually what created the political demand for LVT!

You even pay rent when you buy a house. The value of the land is the market expectation of the value of future rents.

You can have a less than 100% LVT to get some of the advantages without upsetting the apple cart. Common in many jurisdictions.

Full LVT “never works” because landowners have a vested interest in sabotaging it and the vast majority of politicians are landowners.

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.

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.

Personally I’d rather Land tax revenue be distributed evenly as a citizens dividend, and separate from the taxes leveed to make the society which allows people to have income and wealth.

Those who use their fair share are no change, those using more see taxes go up, those using less see a rebate.

The more valuable Land a business uses the more they have to pay, encouraging more efficient utilisation. Their competitor using less Land has lower taxes and can thus out compete them.

Land of course isn’t just dirt, it’s any limited natural resource.

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.

Does a parking lot in Manhattan pay the same cost per acre than a 50 story apartment block does?

It should! The public (through taxes) shouldn't be forced to subsidize the cost of a parking lot. If the parking lot was valuable to the market, the opportunity cost of the land not being used for some other purpose would be priced in (either through consumers paying more for parking, or businesses subsidizing the cost for consumers as it's profitable for them to do so). Parking lots paying lower property taxes subsidizes economic inefficiency.

Author of TFA certainly argues that land and income is better than just income.

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

> I think LVT does have a history in US, e.g Pittsburgh

Yeah, I looked at the map in the article and thought, wait a minute, why is Pennsylvania not colorcoded if Pittsburgh has a land value tax? So the map is only showing states that do? I didnt know there were any states that tax land. But do remember being confused when I moved to Pittsburgh by there being two separate taxes - for land and for property.

I also think that the pittsburgh example shows that LVT is meaningless. All homeowners care about here is their total real estate tax. How it is split between land and property nobody pays attention to.

> All homeowners care about here is their total real estate tax. How it is split between land and property nobody pays attention to.

Right, because there's already a home on the property.

Anyone who owns a parking lot or vacant lot, will care very much about the split.

Then it's just an argument about raising taxes, which any municipality could choose to do, rather than a question of land value tax.

Georgeism is just silly from economics standpoint

I think you misunderstand. Having separate land and property taxes allows the city a lever to discourage vacant lots.

Vacant land has just one tax - which they can raise.

Right exactly. And by raising land tax and lowering (ha) or keeping constant property tax they discourage vacant lots without punishing homeowners even more, which is what happens everywhere else.

> If there's one thing economists can agree on, it's that land tax is better than income tax.

This is overstating the case by a lot. There is a lot of discussion about land value taxes being efficient for various means, but there are far fewer economists who would suggest that 100% LVT is a good idea.

It just wouldn’t be popular. It would instantly get filled with holes and exceptions and distorted until it tries to approximate something else.

Some of the high level economic features that 100% LVT advocates want, like forcing people out of their properties when they become too valuable for other uses, are actually extremely unpopular with people who actually live in homes. You would get a wave of cases where grandma got pushed out of her forever home because the LVT got too expensive and a developer bulldozed it to build a strip mall instead. Under the economic model this is a good thing because the land is being used for its best value, but people actually hate this stuff.

Land value taxes are also really bad at progressive taxation. The hardcore LVT people think this is a good thing because they talk about taxes as “disincentivizing extra work” but we all know that taxes have never stopped people from earning money. Going full LVT puts us in ridiculous situations where someone who earns $500K for a tech company but works remote from a luxurious house somewhere where land is not valued much will pay almost nothing in taxes, but a family with modest income who works a trades job (which generally requires being close to a population center) will have to live in some form of housing subject to very high taxation, therefore paying a lot in taxes.

If you still don’t see it, imagine the outrage when people realized that some billionaires are barely paying more in taxes than a family of four in a modest house in a city where land is valuable.

The more you read about Georgism you more you realize how it’s not as popular with economists as it’s portrayed. There is valuing in taxing land, but we already do that! The debates about eliminating other taxes and replacing them all with LVT is something else, and it’s not universally popular at all.

> there are far fewer economists who would suggest that 100% LVT

Yeah that's the exact distinction I was drawing. The article says Georgism but talks about land tax in general, which is popular with many non-Georgist economists.

However, I have to take issue with your example

1) Land is effectively nationalized under 100% LVT. Worker likely own (the profits of) more land than before

2) The value of the land where the tradesman works is already used against him, to extract the majority of hte profits of his labor. He already pays the land value tax - to his landlord. From his perspective, the burden changes little while the wealthier lose an avenue to make money without working.

3) A luxurious house / lifestyle still requires paying land tax on the things you consume (the land of course and notably energy sources, minerals, timber, building materials, etc). The kind of spartan lifestyle required to truly avoid this tax works now too - incorporate as a company and don't pay yourself a salary.

4) I think very few people care about a $500k salary tech workers, or footballers, or what have you. It's the billionaire oligarchs influencing politics who attract the most attention.

5) Current day oligarchs derive a lot of their wealth from land and other monopoly rents, not from simply 'working more' or 'contributing more value'. This is resented by many. When people get rich by contributing (relatively more) value, they are usually widely praised

The majority of Americans own the home they live in. That’s the real issue here. The landlord the tradesman is enriching is himself.

If you incorporate and don’t pay yourself a salary you still owe corporate taxes.

People absolutely care about the tax rate techies making 500k are paying. They’ll care even more when the billionaires start blasting the airwaves with ads about how unfair it all is.

Athletes have the highest tax rate in the country, why do you think people don’t care about their tax rate?

As far as I know the only tech billionaire with significant land holdings is gates. Zuckerberg and Ellison have big holdings too but not compared to the land per wealth that normal Americans have.

> The majority of Americans own the home they live in

That's the biggest obstacle but also the biggest motivation for increasing land tax. The number is barely 50% currently and falling fast. Of those 40% are owned outright, the rest have mortgages.

This isn't even accounting for commercial real estate and farmland. People complain about grocery price gauging where I live but supermarkets are no more profitable than before covid - they don't realize the main expense change has been land rent.

Once you take out a mortgage you're committed to speculating on that land's future value. If that expectation doesn't pan out, you get a GFC. A gradual land tax would remove some fuel from that fire.

> If you incorporate and don’t pay yourself a salary you still owe corporate taxes

Well yes but actually no - e.g 'buy borrow die'. Regardless, my point is avoiding a land tax isn't as simple as living somewhere with cheap land (it requires consuming less), and people (companies) do also avoid income taxes (it doesn't require consuming less).

> Athletes have the highest tax rate in the country, why do you think people don’t care about their tax rate?

I've never heard anyone talk about this. If I search 'taylor swift tax rate' vs 'elon musk tax rate' I think it's clear.

> As far as I know the only tech billionaire with significant land holdings is gates

Why limit to tech billionaires (who do own lots of land)? The class that specifically didn't make their money from land monopolies, and who pay little effective tax under current system anyway? Trump, Kushner, Witkoff come to mind.

If you're concerned about taxing tech specifically - well George is one of very few people in the 1800s who genuinely considered the full AI + robotics case.

> 1) Land is effectively nationalized under 100% LVT.

You're close to understanding why people wouldn't like it.

100% LVT schemes are basically a mechanism for letting the government force people to do things that the government wants. You want to live in your forever home that you and your husband worked for 50 years to afford? Sorry, government has other plans for that land and now it's too expensive for you to keep it.

The utopian use case that proponents talk about is replacing parking lots with high rise apartment buildings, which everyone loves because it feels like a win for the people and a loss for developers. The more realistic use cases would be much less popular, like the 90-year old couple getting forced out of their forever home because it's close to a substation, which suddenly turned that land into highly valuable property for data centers, which will happily pay those taxes and bulldoze the homes.

Every time I read a 100% LVT piece it's focused on the parking lots to houses type story. They either ignore the more obvious problems of people being forced out of their homes everywhere for businesses to take over, or they do a hand-wavey thing to say it's all for the greater good and we shouldn't care.

Every 100% LVT argument turns into an argument against private property ownership and in favor of a central planning type land reallocation, but with the final use case going to the highest bidder.

People do not actually want this.

This line of reasoning never made sense to me. If the value of the land is going up enough to make an impact on the month to month financials then it makes sense to dip into the equity of the property. Presumably the overall equity still goes up? Beneficiaries still inherit more in fiat terms? What’s the issue here?

Also datacenters are absolutely not going to be built on ultra desirable land, why would the developer ruin the land value that way?

Land is worthless under 100% LVT. Your land value going up just means you owe the government more in rent every year, since the government owns all the land rents. The only real solution to this problem is prop 13 I think which georgists hate. Nationwide prop 13(only on homes) + LVT is still probably better than the current system though imo, although it creates a huge incentive to never move

90 year-olds may well have bought land at a bargain and would therefore suffer somewhat under an LVT. It's a transition problem though - since in the 100% LVT world the couple didn't have to work 50 years (and pay vast interest to a banker) to get that house.

19 year-olds on the other hand already compete with businesses for land (especially corporate landlords - who pay more than datacenter owners) and are losing rapidly.

You do lose the option of speculation - buy early before a town or region is built up. In the current system, speculation is not an option, it is compulsory.

Also you can't force everyone out of their houses - people could simply reserve land for residential purposes (as is already the case). It is still a democratic system, after all.

Finally, western governments already use eminent domain to repurpose land. It's already a part of our system.

[delayed]

Alternatives like aggressive up zoning and development would benefit this cohort and be welcomed as well. It's very natural to welcome things that benefit you

About half might. But then another half will have dealt with actually moving a confused, possibly suffering from dementia, elderly person, managing all of the affairs (and forgetting to do some, changing health care insurance), creating an unnecessary multiyear fuck you in your life while trying to manage a job and a family, and the policy will get torched.

Allowing the elderly to stay where they are isn't just about protecting vulnerable boomers, it's about not being a problem for responsible people in the next generation. You could also be one of those no-contact assholes and never have to deal with your parents when they get screwed by displacement, land value tax away.

I suspect you're right, in the same way that a lot younger people really like any ideas like blanket student loan forgiveness because they have student loans and are receptive to any idea that involves someone else paying for them.

Like most ideas in this category, they become less popular as people grow older and build up some of their own assets. I would expect popularity of this idea to fall of sharply around the age that people start buying a home and see their property tax bill go up.

Practically, this makes it a complete dead end. Much to my lament in every election, younger people don't vote as much as they post online and respond to polls. Older people don't post online and respond to polls as much as they actually go out and vote.

This is why the Georgism thing always seems popular on niche internet boards, but would never get anywhere in a real political system.