Tuesday, 23 June 2020

Killer Arguments Against LVT, Not (480)

"You Georgists just hate landlords!" and "You Georgists are just envious of people with big back gardens!"

The latter is nonsense, we do have a big back garden (by London standards - pretty average for old houses in England), as do many other Georgists I know. Some are tenants, some are even landlords, that does not colour our opinion much.

As to landlords, would you say that the people at IBM who developed the word processor hated typists and type-setters? Are the people who design and build tractors envious of farm labourers? Did James Hargreaves invent the Spinning Jenny to spite people who span fabrics at home?

Nope, they just invented better ways of doing things that were to the overall benefit of humankind. With every step forward, there are people who lose out and have to find a different way of earning a living.

It's the same with tax reform. Government spending which enhances land values (however indirectly) should be funded out of a user charge on the land values arising, and all the regressive and damaging taxes should be reduced as far as possible. If car manufacturer spends money on improving their cars, they get their money back by selling them for higher prices or selling more of them. What's wrong with customer paying more for better product - should those enhancements be paid for out of taxes on the general population, car owner or not?

And if reliability improves, the car repair workshops lose out. So what? That is still to the overall benefit of humankind.

And yes, there are people who have arbitraged or gained from our current unfair and stupid tax/land ownership system who will lose out, the same as the typists, typesetters, farm labourers and weavers lost out in the past.

That's not an argument for sticking with typewriters and type setting; we could argue against those and say we should have stuck with hand writing, but to preserve the jobs of monks, the hoi polloi shouldn't be taught to read and write either, the ultimate logic being we should have stayed living in caves and hunting animals with stones.

And it's not an argument for funding landowner benefits out of taxes on the general population, landowner or not, either.


mombers said...

Hate the system, not the people. Most landlords and landowners are perfectly decent people. I'm an ex-landlord and an ex-landowner, soon (hopefully) to become a landowner again. It's the system that has caused untold misery.

Mark Wadsworth said...

M, correct. I am also home-owner and ex-BTL landlord.

ThomasBHall said...

I have been a tenant and a landowner. While I do agree with the sentiment above- there is something so grubby about landlording I would never for a moment consider going into it now- even if it made complete personal financial sense. It's the same as slave-owning: I'm sure lots of perfectly nice people invested in and even directly owned slaves. But they should have thought about what they were doing- and I would tell them so (as I tell landlords actually).

benj said...

Some of you might remember a chap who advanced the argument against LVT, that it acts as a one time confiscation on present landowners, who in effect pay the tax for everyone in perpetuity. This is correct, but an arguement for LVT IMHO.

Point is, you could say Georgists hate current landowners/landlords. But the once the tax is in place, it would have no bearing on the net incomes of future landowners/landlords i.e like so many things, its all about the transition, including landowner/landlord hate.

BTW, I see no moral difference between any landowner. They bought their property from a previous landowner, so their income, imputed or otherwise is all much the much.

If we are on the subject of slaves, an owner occupier is like only having house slaves, from whom no actual income is derrived. Is that any less grubby?

Lola said...

I have a huge back garden. I own ground rent reversions. But I am also a wealth creator - a business owner, who pays shed loads of taxes on that wealth creation. LVT - if applied properly with the bulk of all other taxes being scrapped - would be a huge benefit to me.

What's not to like?

Mark Wadsworth said...

TBH, yes. Grubby. Exploiting the weak. That is why the early landowners had to cover the whole thing with a veer of respectability, by making people call them Sir or Lord and referring to themselves as Nobility.

B "it acts as a one time confiscation on present landowners, who in effect pay the tax for everyone in perpetuity. This is correct, but an argument for LVT IMHO."

Correct. That's an argument FOR. There's a one-off hit and after that we live tax free. But the Homeys claim it's a one-off hit AND a future tax burden. It can't be both, unless you are capable of Homey Double Think.

Mark Wadsworth said...

L, our house is worth a few bob, but Mrs W and I are in reasonably well paid jobs, so we'd pay less tax. And our kids would pay a LOT less tax. So overall a massive win for us.

Bayard said...

"Grubby. Exploiting the weak. That is why the early landowners had to cover the whole thing with a veer of respectability, by making people call them Sir or Lord and referring to themselves as Nobility."

Actually, that's a complete rewrite of history. It's a very C21st thing to do, to look back at people in the past, assume they had the same idea about everything as us and say "ooh, weren't they horrible".
This idea of tenant as failed homeowner dates from the Thatcher years. Go back to before the WWII and middle class people like my grandfathers rented out of choice. Go back to before WWI and the aristocracy rented out of choice. You either rented, built or inherited. People who lived in houses they had bought were sneered at as parvenus. I'm not saying it was right to sneer at people for whatever reason, but it shows that attitudes were totally different then.

Mark Wadsworth said...

B, when I say 'weak', I mean people who lacked the means to put up proper armed resistance. Like old ladies being mugged. The feudal peasants were quite happy with the old system where the 'land' sort of belonged to the whole village and nobody paid rent.

Bayard said...

You're thinking of common land, however, most commoners (users of common land) had to own or rent land in addition to the common land in order to hold their rights over the common. The rights ran (and still do) with the adjoining land, not the common itself.

Mark Wadsworth said...

B, how old are you? Like a thousand years old?

Mark Wadsworth said...

B, don't get bogged down in details. The Anglo Saxons were worse off after the Normans seized (most of) the land. With every enclosure, the masses ended up a bit worse off. Was Anglo Saxon society a model of egalitarianism? Of course it wasn't, but it was better than after 1066.