"Unknown" submitted a couple of KLNs, you can tell his heart wasn't really in it:
1. The landlord owns the property and land it stands on because of homsesteading. Nobody has moral claim to it other than them.
Poor start. A landlord is clearly not "homesteading" and owns more land than he needs. There's no such thing as a moral claim to land, it's a legal and economic concept, so whether or not a landowner (or anyboyd else) has a "moral" claim to land is neither here nor there. But landowners do not have a moral claim on a large chunk of everybody else's output and labour, i.e. the taxes on output and earnings which are used to pay for those government services which give land its value in the first place.
2. Land is just one more scarce resource. There are many, many people who live fulfilling, economically productive lives never owning land.
If we put a 100% tax on chicken consumption, guess what? Everybody would eat turkey McNuggets.
Georgism is stupid because no scarce resource is unique. They're all scarce and thus not special. There's even plenty we're not making more of. The idea of one of them being the one thing we can tax is just ridiculous.
That's kitchen sink stuff.
I don't think that land is scarce at all, 99% of the UK population lives and works on less than 10% of UK surface area, the developed bit. Developed land = geographical areas where society in general and the government in particular make land valuable, that's where people want to live, some trade-off between good jobs, shops and leisure opportunities, good schools, low crime, good transport links, nice views, a bit of open nature - or not as the case may be. Developed land is 'scarce' because providing or organising all these services is very expensive and complicated (simply owning land is the easiest bit); it is the services which are in limited supply.
It is quite true that many people don't own land. Most of them are economically productive, but their lives are all the less fulfilling for having to fund land values out of their taxes AND pay rent for somewhere to live or do business. But if they can manage - and they can - why can't everybody? Is there a special class of people who can only lead "fulfilling, economically productive lives" if they own land? How is a landlord "economically productive" anyway? Any tenant who buys the place he was renting must know that they aren't.
The chicken-McNuggets analogy is fatuous. Land Value Tax is just landowners paying the government for the value of the services they receive, it's a user charge, like paying for the market price for chicken or turkey McNuggets. You wouldn't say that McDonalds charge a 100% tax on turkey McNuggets, they just charge market price. And the government can "tax" land rental value at 100% (for administrative reasons, call it 80-90%) and the land is still there, the same services/benefits are still being provided at that location, and demand for land is unchanged.
As mentioned, whether land is scarce or not is irrelevant. What makes it unique is the fact its "value" is actually the value of services and benefits being provided at that location. My car doesn't change in value if I buy it in Wales and park it in Kensington. If you could buy farmland in Wales and move it to Kensington, it would go up in value a million times over. That's why land is an ideal source of government revenues (there other equally ideal taxes, like fuel duty, but they are minor in comparison), and certainly far better than taking arbitrary percentages of business output (VAT), wages (National Insurance) or income generally (income and corporation tax).
Thursday, 29 October 2020
Killer Arguments Against LVT, Not (486)
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Land is different, because it is supplied free of human inputs. Thus income derived from it is cost free i.e free money.
Those excluded from source of free money suffer a loss of opportunity, that if uncompensated, bakes in excessive inequalities and all the social and economic consequences that follow.
Paying the LVT is therefore in principle no different from paying for wages, goods, services received. A matter of basic economic justice and all the benefits that follow.
B, we come to the same conclusion for different reasons. I could argue that all atoms and molecules are free gifts of nature.
If you buy goods, 99% of the value is the labour, ingenuity etc and 1% is the 'free' atoms and molecules. It's the same with land. 99% of the value is the services and benefits provided (by the government or individuals or businesses) and 1% is the physical land.
The other KLN I've notices is when objectors say that LVT is land nationalisation. I've got news for them. Land is already nationalised. The 1947 Town and Country Planning Act took care of that.
Even the Law notes 'special privileges'. From wiki:
At its core, English land law involves the acquisition, content and priority of rights and obligations among people with interests in land. Having a property right in land, as opposed to a contractual or some other personal right, matters because it creates privileges over other people's claims, particularly if the land is sold on, the possessor goes insolvent, or when claiming various remedies, like specific performance, in court.
L, maybe it is moderate form of "land nationalisation" in a way. But so what?
1. It's not real land nationalisation with collective farms and state-allocated housing, we know where that leads.
2. Even if LVT is a moderate form of "land nationalisation", that's still a damn sight better than "nationalisation of private effort and enterprise" by taxing away about half the value generated.
MW. I am not complaining about the T&CPA. I am juss saying...
Note. In my local council (Babergh D C) planning guidelines on its website it actually states that land has been de facto nationalised for 1947.
L, I'm not bothered about T&CPA, I can see the general point. Nice quote from local council!
" I could argue that all atoms and molecules are free gifts of nature."
You could. But "land" in the economic sense refers to 3D space i.e differences in locational productivity, not the atoms and molecules that inhabit it.
@MW
The trouble with your "Georgist" explaination is that while its true, it also applies to everything. Without "society" nothing would would have any monetary value.
It may convince most, so good propganda, but not so good on folk like me. Therefore on a good base to build on. IMHO.
B, again, 3D space or radio spectrum are free gifts of nature.
"it also applies to everything. Without "society" nothing would would have any monetary value."
Probably true. But so what?
Somebody makes a car or writes some software, people who get the (benefit of) the car or software pay the producer the market value.
Society creates location values, so the people who get the (benefit of) those values should be paying the market value to the society which generated it i.e. the government collecting it on behalf of society (and hopefully spending it or redistributing it fairly and wisely).
"It may convince most, so good propaganda." I am a simple kind of person, and this justification will do me, seems pretty bullet proof to me.
@MW
Lets fire some bullets then (for the benefit of anyone else reading these comments).
The intersection of supply and demand gives those things supplied their monetary value.
We know where supply comes from. Demand comes from humans networking and concentrating resources, resulting in economies of scale.
Without that demand, nothing gets supplied by humans. There is no economy.
Socialists take that as society being owed part or everything of monetary value. That's consistant, but wrong.
Society is a tool. We only owe our tools their upkeep. Tools are not harmed by being excluded from things that are supplied. Individuals are.
So who is being harmed by the exclusion from the returns to land, labour and capital? Who should be compensated?
You can't have it both ways. Society being owed for somethings that are supplied but not others.
Georgism is socialism, just not applied to labour and capital. That's not consistant (is full of holes). IMHO.
Anyway, I thought you were Geo-Lib?
B "You can't have it both ways. Society being owed for somethings that are supplied but not others."
My view is, stable society is just a good thing all round, that's taken as a given. All land needs to have a rental value is a stable society. Things like cars and fridges and haircuts need extra individual effort on top of that.
B: "So who is being harmed by the exclusion from the returns to land, labour and capital? Who should be compensated?"
It's a book keeping thing. Creating and maintaining land values is a massively expensive exercise. Before we start discussing compensation for those excluded, let's focus on making the beneficiaries pay for the expensive exercise. That's instead of making everybody, including those excluded, paying for that exercise via taxes on output and employment. That's a double slap in the face for the excluded.
The value of land is the surplus productivity above that of the least productive site in use. Normal supply/demand curves do not apply because land is not a fungible commodity and is inelastic in supply.
There never was such a thing as homesteading except as land rights granted and protected by government, in the case of America by the force of the US Army.
Ph, yes of course, but that doesn't help us to rebut KLNs.
A landlord is clearly not "homesteading"
Correct. But the original owner was. And created property. And then sold it. Owning land is as valid as owning a boat you didnt build yourself but you just bought.
There's no such thing as a moral claim to land,
Homesteading.
But landowners do not have a moral claim on a large chunk of everybody else's output and labour, i.e. the taxes on output and earnings
Correct. Nobody has a moral claim on those other than the ones who created that output/labour. Only by getting the owner of those things to give them freely and consentually can you own them. Taxation is theft, friend.
government services which give land its value in the first place.
Completely wrong, actually. Value is purely subjective.
Anon, if there is such a thing as "homesteading" then it is a personal right and not transferable. Like the right to vote, every adult gets the right to cast one vote, that right can't be sold or passed on by way of inheritance.
"Completely wrong, actually. Value is purely subjective"
The rental value is the highest amount that anybody is prepared to pay to occupy any particular plot of land, even if only one single person happens to be prepared to pay that amount. Whether the tenant and landlord's opinions are 'subjective' or not, they can be objectively measured (and averaged and smoothed etc).
"Correct. But the original owner was. And created property. And then sold it."
I would be interested to see an example of property being "created" in this way. 99.9% of land that is sold for the first time has been taken by force from someone else, who owned it to the extent that they had free access to it, which was then denied them as part of the process of property "creation".
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