I would challenge you to point out exactly where in OP's comment that he advocates abolishing all taxes except land taxes. I see only a comparison to taxing land vs property.
Lars here. I run the Center for Land Economics with Greg (we wrote the OP blog post). We are not maximalist single taxers.
Henry George was obviously a Single Taxer, but "Georgism" has a generally broader meaning than that. Some Georgists are single taxers, but not all, including Greg and I.
When we talk to elected officials, we don't even talk about Henry George all that much (I did in the ACX article series because it all started with the progress and poverty book review). We mostly speak of "Land value return" and our focus is mostly on pragmatic revenue neutral tax shifts to LVT.
Why care about wealth disparity at all as long as everyone is better off? If I offered you to double your real wealth but also Bezo's real wealth, would you reject that offer just because wealth disparity went up?
Because obscene levels of wealth disparity makes everyone worse off. Power is a zero sum game.
If I were offered to double your real wealth but also double Bezos's real wealth, of course I would take that deal! I would benefit from it. But if you offered to double the real wealth of everyone, what would that even mean?
You are confusing money and wealth. We can all be richer. The vast majority today has riches that a medieval king could have never dreamed of. Exotic fruits year around. Magic devices. Healthcare that goes beyond anything medieval people could have imagined.
Yes, unlike economics, politics is zero-sum. The solution to that is to fix the political system, not to destroy the things that are working great.
I like Georgism, but I don't think it should be limited to just LVT. I think ownership of all natural resources (especially scarce ones) should be taxed at an aggressively progressive rate. Own one oil well? Cool. Own enough oil wells to supply the entirety of the Allied Forces throughout the duration of the European Theater in World War 2? Meh.
What if your only relationship with land is that you rent an apartment, but from that apartment you build a $10M/year revenue social network? How should that be taxed? Should it at all?
GP doesn't appear to be advocating for abolishing all tax. The thrust of it seems to be to abolish property tax and replace with a land value tax. There's no mention of abolishing income, capital gains, sales, use, etc. taxes.
Maybe don't attack a straw man you've stood up yourself?
I'm pretty certain Henry George would be very happy with pigovian taxes like a carbon tax as well.
Income tax it's definitely something he'd not prefer because it reduces incentive to do something we want you to do. Better to tax windfalls and undesirable things
Cool, but just bringing up Georgism doesn't mean the commenter wants to go all-in full Georgist. People can agree with part of a philosophy and not all of it. But we don't know, so we should assume good faith, read the comment charitably (per HN guidelines), and argue against what the commenter actually said, not what we might assume they believe.
I don't mind land value tax! Like you, I think it's one of many valid kinds of tax that a government can put on its citizens to achieve various social goals. Hence, I am not a Georgeist.
You can tax certain things a certain amount and you get diminishing returns. For example, if you had a 50% wealth tax, it would stop collecting anything pretty quickly and would cause pretty big economic disruption.
Land value tax has the potential to collect a lot of money with less disruption.
There's like $20 trillion worth of capitalized land value in the USA. That could mean like $1 trillion a year on-going assuming 5% discounting. Land rent is a perpetual stream of wealth.
There's only $8 trillion billionaire wealth. So already 5%/year would be less. And there's a huge incentive and ability to avoid it by moving.
And I rarely ever even hear suggestions for wealth tax rates around 5%. So then if you had a wealth tax, well land is wealth, and you'd be leaving a ton on the table as you could still have the land value tax at 5% of the capitalized value.
That money could be spent on public services that poorer people will benefit from more like transit, schools, or even local hospitals and subsidized healthcare. A typical point by LVT supporters here is that these services have the impact of raising land rents.
Most taxes have this dynamic:
tax -> invest in public services poor people use -> land rents go up -> land owners benefit
LVT has this dynamic:
Tax land -> invest in public services poor people use -> land rent goes up -> tax land more so land owners don't benefit
Landlords, developers, builders etc. should earn the return on the constructed housing, not the land.
I would challenge you to point out exactly where in OP's comment that he advocates abolishing all taxes except land taxes. I see only a comparison to taxing land vs property.
That's what Georgeism is?
Lars here. I run the Center for Land Economics with Greg (we wrote the OP blog post). We are not maximalist single taxers.
Henry George was obviously a Single Taxer, but "Georgism" has a generally broader meaning than that. Some Georgists are single taxers, but not all, including Greg and I.
When we talk to elected officials, we don't even talk about Henry George all that much (I did in the ACX article series because it all started with the progress and poverty book review). We mostly speak of "Land value return" and our focus is mostly on pragmatic revenue neutral tax shifts to LVT.
And where do they advocate wholesale adoption of Georgeism? You can like one part of a theory without adopting it all.
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Why care about wealth disparity at all as long as everyone is better off? If I offered you to double your real wealth but also Bezo's real wealth, would you reject that offer just because wealth disparity went up?
Because obscene levels of wealth disparity makes everyone worse off. Power is a zero sum game.
If I were offered to double your real wealth but also double Bezos's real wealth, of course I would take that deal! I would benefit from it. But if you offered to double the real wealth of everyone, what would that even mean?
You are confusing money and wealth. We can all be richer. The vast majority today has riches that a medieval king could have never dreamed of. Exotic fruits year around. Magic devices. Healthcare that goes beyond anything medieval people could have imagined.
Yes, unlike economics, politics is zero-sum. The solution to that is to fix the political system, not to destroy the things that are working great.
2 replies →
I like Georgism, but I don't think it should be limited to just LVT. I think ownership of all natural resources (especially scarce ones) should be taxed at an aggressively progressive rate. Own one oil well? Cool. Own enough oil wells to supply the entirety of the Allied Forces throughout the duration of the European Theater in World War 2? Meh.
What if your only relationship with land is that you rent an apartment, but from that apartment you build a $10M/year revenue social network? How should that be taxed? Should it at all?
That would be income tax
3 replies →
GP doesn't appear to be advocating for abolishing all tax. The thrust of it seems to be to abolish property tax and replace with a land value tax. There's no mention of abolishing income, capital gains, sales, use, etc. taxes.
Maybe don't attack a straw man you've stood up yourself?
I'm pretty certain Henry George would be very happy with pigovian taxes like a carbon tax as well.
Income tax it's definitely something he'd not prefer because it reduces incentive to do something we want you to do. Better to tax windfalls and undesirable things
My understanding is that Georgism opposes the kinds of tax you mention.
Cool, but just bringing up Georgism doesn't mean the commenter wants to go all-in full Georgist. People can agree with part of a philosophy and not all of it. But we don't know, so we should assume good faith, read the comment charitably (per HN guidelines), and argue against what the commenter actually said, not what we might assume they believe.
1 reply →
I think land value tax is good.
That doesn't mean LVT is a panacea.
I think that's a bit of a strawman and a false dichotomy.
I don't mind land value tax! Like you, I think it's one of many valid kinds of tax that a government can put on its citizens to achieve various social goals. Hence, I am not a Georgeist.
why not?
The onus is on you to describe some mechanism by which abolishing almost all taxation will magically fix wealth discrepancy.
I don't know what degree "fixing" means.
You can tax certain things a certain amount and you get diminishing returns. For example, if you had a 50% wealth tax, it would stop collecting anything pretty quickly and would cause pretty big economic disruption.
Land value tax has the potential to collect a lot of money with less disruption.
There's like $20 trillion worth of capitalized land value in the USA. That could mean like $1 trillion a year on-going assuming 5% discounting. Land rent is a perpetual stream of wealth.
There's only $8 trillion billionaire wealth. So already 5%/year would be less. And there's a huge incentive and ability to avoid it by moving.
And I rarely ever even hear suggestions for wealth tax rates around 5%. So then if you had a wealth tax, well land is wealth, and you'd be leaving a ton on the table as you could still have the land value tax at 5% of the capitalized value.
That money could be spent on public services that poorer people will benefit from more like transit, schools, or even local hospitals and subsidized healthcare. A typical point by LVT supporters here is that these services have the impact of raising land rents.
Most taxes have this dynamic:
tax -> invest in public services poor people use -> land rents go up -> land owners benefit
LVT has this dynamic:
Tax land -> invest in public services poor people use -> land rent goes up -> tax land more so land owners don't benefit
Landlords, developers, builders etc. should earn the return on the constructed housing, not the land.
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