Killer Arguments Against LVT, Not (170)

Let's hold our noses and dip back in to the next two paragraphs of the Homey/Faux Lib ranting in yesterday's City AM in which the author misprepresents and then trashes the IF's fine report:

...In view of the real housing shortage (1), the charity’s surreal answer is that the government should tax the elderly into smaller homes. It would (how generous) exempt the over-60s from stamp duty when they sell to move to a smaller home; and it wants to replace the council tax with a land tax, "to reflect the social cost of occupying ... housing that is larger than one’s needs" (2). In a very welcome move, housing minister Grant Shapps dismissed the idea, replying that the elderly would not be bullied out of their homes.(3)

The report correctly laments the decline of UK home ownership, which went down from 70.9 per cent in 2003 to 67.4 per cent today.(4) Owning one’s home is now virtually impossible for the young.(5) But the shortage of housing and its high cost are in large part the consequence of state interference. Supply can’t satisfy demand as land prices are kept high by legal rationing. Building is held back by regulatory restrictions. The answer isn’t to ration homes – instead, government needs to make planning permission simpler, so more houses are built.(6)

Nope.

1) There is no 'real housing shortage', that was the whole point of the report, did he not read it?

2) There is a social/economic cost to land-ownership; this cost imposed on others is, broadly speaking, equal to the benefits accruing to the land-owner. What's wrong with taxing such costs? Admittedly, that external cost is much the same whether the land itself is over- or underoccupied, but then again, over-occupation imposes a cost on the over-occupier as well, things like 'fuel poverty' and the fact that their children and grandchildren have to move far, far away to be able to find somewhere they can afford to rent or buy.

The bitter irony is that a lot of Homeys were bleating 'Oh but I need spare bedrooms in case relatives come to stay', well, if there was more downsizing and more new construction, then people would be able to afford live closer to their ageing parents and so there'd be no need to keep a spare bedroom on the off chance that they make an occasional visit.

3) The Homeys are doing a fine job of that themselves, aren't they? Isn't it quite clearly the case that young people are quite deliberately and calculatedly being denied the chance of ( or "being bullied out of") owning their own homes on the same favourable terms as older people did? The whole point of Home-Owner-Ism is, ultimately, to reduce the number of owner-occupiers...

4) ... as is clearly evidenced by this stark statistic.

5) Yup, that's the whole point of not having LVT, so that each generation can skew the playing field against the next one. Each generation hikes taxes on incomes, employment, profits etc and reduces taxes on land, thus amplifying the transfer from young to old and further concentrating land ownership in ever fewer hands.

6) Faux Lib bullshit, frankly. 'The state' as an abstract concept couldn't give too hoots about how many houses are built or not, it is the self-same Home-Owner-Ists who make bloody sure that what were once basically sensible planning rules are interpreted to mean that 'nothing new may be built'.

If the current government scrapped all planning laws tomorrow, you can be bloody sure that at the next General Election, whichever party promised to reinstate them all would get straight into power. In any event, the report makes it perfectly clear that this exercise of NIMBY electoral power has contributed to the present state of affairs (and recommends iberalising planning laws). And just you wait until the council grants planning for something near where a Faux Lib lives, they turn into raving blue-socialist NIMBYs like anybody else.