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Georgism doesn't pass the laugh test either. It's impossible to fund a modern government with land taxes alone. We'd have to revert to 1776 levels of taxation. Maybe not a bad thing overall, but kiss social security and aircraft carriers goodbye.
Nevertheless, more Georgist-esque taxes are a good thing. In major urban areas, we should tax land more and buildings less.
Will this "one weird trick" fix the fertility and housing crisis? No. But it might help, slightly.
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Georgism is equivalent to the elimination of private real property. I don't think that's going to fix the fertility crisis. If it "fixed" the housing crisis, it will be by accelerating the process of putting us in pods. This is why urbanists like Georgism, it forces property "owners" to develop "their" property to the utmost or pay taxes the property's income cannot support.
Surely there's a middle ground.
Imagine some lord who owned land in central London in 900 AD, used it as a sheep pasture, and then passed it down to his sons for 30 generations, each using it as a sheep pasture onto the present day. There's no property taxes because taxes = theft. The lords never sell or convert their land to non-pasture since the value goes up every year.
Why not just kill the lord, build a park everyone can use, and then piss on his rent-seeking grave?
Surely there is a place for reasonable accommodations to common sense in any system, even if we should err on the side of ancient liberties. For example, I think that on balance the electoral college is a good thing, but the pre-1832 rotten boroughs of England take things too far.
This comment undercuts the moral argument for Georgist taxes pretty severely. (I've long been suspicious of the practical argument in general, although the practical argument of "we ought to incentivize the medieval sheep farmer to get the hell out of the middle of London" still makes a huge amount of sense in your hypothetical.)
A tax that can be framed as "We're just taxing the value that the rest of society has provided to you" feels like a huge moral advance over the typical lesser-of-two-evils "We can't make civilization work without lots of money so we're raising the amount of yours we'll take; pray we don't raise it further". And this moral justification for land-value tax makes some sense, for land uses where most of your revenues (and/or at least your use-value for a homestead residence) really come from the value of proximity to your neighbors. But what if you just wanted to farm sheep, and the main thing your neighbors have done to aid that is dump a bunch of air pollution into their lungs and their wool? Asking you to pay ever-increasing taxes for that service seems almost cruel.
Then you sell your central London sheep farm for a gazillion pounds and buy a sheep farm somewhere else.
If we make a rule that people and their descendants get to keep their property tax free forever we end up with a stagnant, feudal economy. That puts us in the bottom left corner of the "growth / equality" grid, the worst of all words economically speaking.
Honestly, I'm probably 90th percentile in the anti-tax camp, but we need to be practical. Abolishing property tax goes too far.
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What rent is he seeking? He's passing up taking advantage the value of the land by pasturing sheep on it (surely, in the modern world, an activity with very low economic value). For what reason should his land be expropriated? If Richard Branson wants to build an apartment building there instead, let him make an offer.
I explained this in a different comment.
Let me be the one to ask a question. Are you are against property taxes?
I'm against taxes in general, but if a government must be funded, property taxes CAN be a reasonable way to do it. Georgist taxes are not, for various reasons, one being that the government cost attributable to the land is typically more related to improvements than the land itself, at least in urban areas.
As for rent, what you're talking about is just capital gains, which isn't the same thing as rent or rent-seeking. The owner is actually forgoing the land rents.
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We have some of these: Lord Cadogan and (the Duke of?) Westminster. If I’ve learned anything, it’s that such people are far, FAR more responsible and long-termist landlords than the politicians and private equity companies that would like to replace them.
Because the lord, who is aware of the limitations of aristocratic power and is also a normal human being who quite likes parks and doesn’t need more money, will build parks of his own accord. The politicians will build ugly vanity projects and the equity people will build unobtainable buy-to-lets for the Chinese.
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I can see the case for lost economic productivity, but how could using your own property as a sheep pasture despite opportunity to develop it be in any sense rent-seeking?
Maybe it's not the most perfect example of rent-seeking.
But it's close enough.
Every year your wealth increases due to the urbanization of London, but you personally have created none of that wealth. You are just the heir of a lucky land speculator.
Your wealth on paper increases, but if you continue to use it from for sheep pasturing then you are not benefitting from it because you are precisely not seeking any rent that matches the value of the land!
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