Killer Arguments Against LVT, Not (173)

Prelude, from 1984:

"[Winston Smith's] mind slid away into the labyrinthine world of doublethink. To know and not to know, to be conscious of complete truthfulness while telling carefully constructed lies, to hold simultaneously two opinions which cancelled out, knowing them to be contradictory and believing in both of them, to use logic against logic, to repudiate morality while laying claim to it, to believe that democracy was impossible and that the Party was the guardian of democracy, to forget whatever it was necessary to forget, then to draw it back into memory again at the moment when it was needed, and then promptly to forget it again: and above all, to apply the same process to the process itself.

That was the ultimate subtlety: consciously to induce unconsciousness, and then, once again, to become unconscious of the act of hypnosis you had just performed. Even to understand the word 'doublethink' involved the use of doublethink."
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There are (at least) three ways of looking at or measuring how wealth flows to landowners, which all come to the same thing when expressed in £-s-d:
i. The rental income which accrues to them, which can be enjoyed in kind (by living there) or turned into money by renting out the place or selling it.
ii. The value of the benefits which accrue to landowners because of the location, location. location (which is another way of saying that land values are created by the community).
iii. The burden which any landowner places on 'everybody else' (i.e. those members of the community who created the land value in the first place), the external cost to 'everybody else' is of course more or less equal to the benefit accruing to the landowner in i. (see second part of previous link for the maths and logic behind that).

When we look at i. the Home-Owner-ists claim that non-cash income is not income, and when we look at ii. recent purchasers with a mortgage say, not entirely unreasonably, that they are paying for those benefits out of their hard-earned money. However, iii. is the coolest way of looking at it because this way it is irrelevant how any landowner came into ownership - for example, the fact that your neighbour has bought his new television out of his own hard earned - rather than winning it in a raffle or stealing it from a shop - does not give him the moral right to listen to it full blast all night long.

When it comes to LVT, the Homeys flatly deny that they are placing any sort of burden on anybody else (see discussion over at 4liberty) and thus they think they have a clever argument against iii. as well.

Fair enough. We conclude that on Planet Homey, a landowner places no burden on others or on other landowners. To each action is there is no reaction. We can have specialisation without free trade. Black is white.
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The funny thing is, when it comes to increasing our real housing wealth (as opposed to paper wealth) and simply building more houses where people would like them, the NIMBYs are out in force saying that no new housing should be built because the new homeowners (landowners) will place a burden on the existing homeowners (landowners) in that area (farmland isn't really land for these purposes, it's main purposes is just to provide a view as far as NIMBYs are concerned).

On the assumption that you'll never get a Homey or NIMBY to admit to being a raving hypocrite, how do they square this? There argument seems to be that not building houses anywhere near them is the right thing to do for society as a whole because, presumably, the burden this places on existing homeowners far outweighs the benefits to the potential new homeowners.

Now, if that is correct, if we start with the oldest house first, every single house built since then must have placed a burden on the owner of the oldest house (because of agglomeration, the reverse usually applies in real life, which is why land in the centre of towns and cities is infinitely more valuable than farmland, but the Homeys even deny this), and let's assume that either

a) The new houses have now been built. Surely the burden which the new houses place on the older houses is exactly equal to the burden placed by the older houses on the newer ones, in which case the whole thing is a score-draw (notwithstanding the agglomeration benefits to owners of old and new and the fact that the more housing we have, by and large, the happier we are)? or

b) The new housing is refused planning and does not get built. Then there are the burdens which the existing homeowners place on the owner of the farmland who'd love to get planning, and on the people who are thus forced to live further away, in a less desirable area, in more cramped or more expensive accommodation etc, which must, by any stretch of the imagination, also be pretty hefty and ball-park, those burdens are equivalent to the current value of the existing housing, i.e. the benefits which accrue to existing homeowners in any area.
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So when it comes to arguing against LVT, land owners place no burden on others; but when it comes to arguing against new housing they do. If you tried to programme a computer with this sort of stuff, it would cease to function.