Comment by vineyardmike

Prop 13 isn't for seniors, though, it's for all ages. And the heirs inherit the tax base. A senior-only prop 13 would reset at death, so at least it's limited in duration.

A common one I've seen is that for the elderly, property taxes are deferred until they die and are then deducted from their estate (including a sale of the house).

IMO this is a much more fair system than just saying "lol no taxes on the elderly."

The nonexistence of Prop 13 in other states should be pretty clear evidence that there are more options besides Prop 13 or kicking out lifelong residents.

California already has property tax deferment.

> There is an assumption but no explanation how kicking long time residents out of their homes due to tax pressure is a benefit to the community

One benefit of an equal property taxation system would b having workers close to the city centres where they work rather retirees.

> And when that home is sold the tax assessment of course goes right back to market rate, and boy that is substantial when you have what would be a 450k home outside of Boston go for 2.1m with a 1% tax. 21 thousand a year off a single 50ft wide lot is no slouch in terms of tax revenue.

The problem is all the tax revenue being lost at the municipality level for decades. National tenure average is ~12 years. Los Angeles is 20 years, SF is 16.5 and SJC is in between. It clearly has a meaningful effect, it's just harder to buy into the market and keep the home over a long period of time.

Prop 13 also applies to commercial real estate.

It's not reset of you inherit, or a bunch of other bullshit exemptions.

We live in a gerontacracy. Every advantage and tax break and handout is given to the elderly and the ladder has fully been pulled up for the new generations.

> Land is not cheap to repurpose. The Georgism dream that land can be optimally used is a farce. There is significant costs to repurposing land - to make those costs worth it because of the taxes would heavily distort current society, and I think the assumption that this would be desirable compared to the status quo is unproven.

Your friction is real - and already exists.

So the bar for improvement is not no friction.

The bar is less friction, and higher productive use of land, which benefits everyone. Lowering the costs of both housing and business space, while increasing economic output.

That is was economic alignment does, it doesn't just improve one thing, or improve on a one-time or fixed percentage basis.

And less passive, underutilizing, economically-parasitic investments from the rich. (Rich passive investment in land, uses land like Bitcoin for its deflationary nature, which compounds land prices while suppressing its full productive use.

Not raises. Compounds. The more the rich passively invest in land, the more profitable land becomes to passively invest in.

Stating truisms ahead of straw manning me avoids the actual discussion. "Everything has real negative consequences." "Land is not cheap to repurpose." I never said otherwise.

You're right about my estimate being off though and it was a disservice to the discussion. An equivalent revenue from sales tax would require ~2.1%. In SF, that would move the total sales tax from 8.6% to 10.7%; in Oakland, 13.8%. A large increase would likely bend some consumer behavior (chasing sales that have feet, aka move to the informal/grey market).

> Again, the optimal answer from an economist is not necessarily desirable from an emotional perspective of the people being governed.

This is the real difference between us imo. I believe the optimal answer is based on realistic projections on revenue collected and what prevents bankruptcy. The compromise answer is what passes a vote and in fact, the bankrupt answer.

I would prefer we didn't raise taxes and instead reduce spending. But given the complexity of reducing spending and the scale of our deficit, we will have to do both. On the side of raising revenue, a land tax offers a way of taxing a wealth that cannot flee.

The negative side effects of taxes on labor are enormous, and have distorted humanity probably more than any other factor.

Any consideration of the consequences of taxes also has to consider the consequences of the current taxation.

But taxes have and will always be a transfer of wealth from the working poor to the rich and powerful. People talking about tax reform or more effective and just systems tend to forget this. It's like the lamb having an opinion on how the wolves should share it.

> you think seniors and young people don't have affordability problems?

Of course I don't think that, which is why I didn't say it. That would be a silly thing to write. What is the advantage for you in mischaracterizing what someone wrote and then expending effort to "correct the record" for a statement no one made?

You created a strawman and then knocked it down.

What I actually said: "New Jersey or Texas that do not have Prop 13 style laws and their seniors are not suffering excessively. However housing is much more affordable for younger people in those states."

Both of these statements are demonstrably true. Let's look at the data.

   * NJ price to income ratio for housing: 5.5
   * mortgage cost burden: 31% of mortgage owners spend more than 30% of their income on housing.
   * renter cost burden: 52% of renters spend more than 30% on rent

   * CA price to income ratio for housing: 8.0
   * mortgage cost burden: 38% of mortgage owners spend more than 30% on housing
   * renter cost burden: 58% of renters spend more than 30% on rent

So housing in NJ is more affordable than in CA.

Now, let's look specifically at seniors.

In California:

   * 68% of senior renters are cost burdened
   * 35% of senior homeowners are cost burdened

In New Jersey:

   * 59% of senior renters are cost burdened
   * 35% of senior homeowners are cost burdened

So we see that across the board, seniors in NJ are not cost burdened more than in California, and that in fact they are cost burdened a bit less.

Therefore if your solution is to look to Prop 13 style fixes to address cost burdens for either seniors or the general population, then you are not making a data based argument, and in fact the data goes against you, because there is no excess cost burden in states without these property tax freezes.

Kicking in at retirement age plus limiting it to a single owner occupied property is the key, IMO.

In California, it applies to multiple properties, you can pass it down to your children and it applies to property owned by businesses both commercial and industrial, which is absolutely crazy.

California has basically created a class of landed gentry.