5 ms·

'Land ownership' actually means 'rights for exclusive use of land'. Government owns the land but gives out rights to use to people. If oil deposit or gold mine

'Land ownership' actually means 'rights for exclusive use of land'. Government owns the land but gives out rights to use to people. If oil deposit or gold mine is found on it, the right is often revoked after compensating the rights holder. The prices for rights of use are determined by market, but usually bundled together with prices of buildings on it. One way to look at Georgist critique of current land system is that the rights of use are sold once but held infinitely long. If you got lucky and bought a piece of land in downtown Manhattan 200 years ago for 20 bucks, now you wouldn't need to pay anyone for granting you that ownership right. Basically land (and natural resources) are owned by people who got lucky, not by people who actually use it (such as a restaurant which has to rent it from that lucky holder). If the ownership rights were not given for infinite amount of time but reentered into an auction every, say 7 years, the allocation of land would then go to people who actually need it. It is the same economical problem as Domain Name allocation on web. People 'own' land on paper only. The government actually owns it no matter if you are in China, Europe or United States.

lend000 7y ago
I like the auction aspect the parent described in another comment. However I don't like the idea that the government can revoke at will and eminent domain you out of property even if you paid the tax you won at auction. For example -- what incentivizes people to take their expensive expertise, time and equipment and survey land before placing a bid at auction? If the government is going to be the only one to survey land, that's a great way to kill innovation in the field of natural resource exploration. Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house?
- snidane 7y ago
  Yes, many people are not comfortable about being evicted. In reality that is how majority of people and business operate because they rent from somebody else. Your apartment lease usually expires after a year and you can be 'evicted' by your landlord. Businesess have contracts for longer periods (about 10years) of time because they put more investment into it. Instead of renting from lucky private landowners, the business owners could just as easily lease from a government for 7 years. The only question really is how long the auction should repeat after. Every year would mean people would not invest much for risk of non renewal of the contract next year. On the other hand too long between auctions (such as infinite time like in present day situation) and you get huge underutilization because the lucky winner in the first auction is not pressured to sell. LVT (or this auction mechanism) is based on market price of the land in that area so it changes in time. To prevent sudden spikes in price, the valuation of land should happen in intervals of several years like I described above in the case of an auction.
  - mlthoughts2018 7y ago
    I would consider “ability to be evicted” to be a great moral wrong, and that access to comfortable housing that doesn’t cause an unreasonable commute to be a basic human right on par with free medical care & education. It’s hard for me to think of a way to square this without a concept of land ownership and exclusive property rights. I guess some type of lifelong lease from the government could be OK, but some land is more valuable than other land for living, so then how to allocate the best livable land? At any rate, I do view the capability to be evicted as a moral wrong.
    - jdmichal 7y ago
      > I would consider “ability to be evicted” to be a great moral wrong, and that access to comfortable housing that doesn’t cause an unreasonable commute to be a basic human right on par with free medical care & education. These two ideals of yours are contradictory. The right to not be evicted (in order to better develop the land) can directly prevent the availability of housing with the qualities you require. With the help of zoning boards, which are really just an embodiment of their constituent land owners, isn't this more or less the sum of the housing issue in the bay area? You certainly cannot say that there's any semblance of comfortable hosting with a reasonable commute...
      - mlthoughts2018 7y ago
        I agree with you that it’s two contradictory forces, and yet I still believe either outcome is wrong. If a person can be evicted from where they live, that is wrong. Yet also if comfortable, nearby, affordable housing (that you did not need to evict others to build) is not widespread for all, that is also wrong. It’s important to focus on solutions that solve both sides of the problem, and to deny arguments that it’s functionally not possible (which would be an unacceptable outcome). I don’t mind the contradictory positions in terms of market theory and efficient allocation, and believe it’s important to pursue anyway, that this technical contradiction is fine... necessary even.
        7y ago
- sjy 7y ago
  The comment you are replying to suggested that 7-year leases could be auctioned. A lease cannot be revoked “at will.” But it does mean that people can be priced out of their homes when the lease expires. That’s the point.
  - chaorace 7y ago
    Coincidentally, this is similar to the lease-hold system in Hong Kong. Most land plots revert to the government after a 75 or 99 year lease term. You can sublet land during that period, but whoever directly holds the government lease is obligated to pay an annual tax equal to a percentage of the land's rated value.
- crdoconnor 7y ago
  >Or will the price keep going up and price you out of your longtime house? If we don't have a problem with elderly renters getting priced out and not receiving a windfall (public concern for this issue is pretty muted) I don't see why homeowners getting priced out and receiving a windfall is worse. I always found it deeply ironic that the Howard Jarvis Taxpayers foundation successfully lobbied for prop 13 on the "won't think of the pensioners homeowners" argument and then turned around and lobbied to slash pensions... yet their propaganda still carries weight today.
  - rcpt 7y ago
    If you read the stuff Howard Jarvis Taxpayers Association puts out it's mostly "taxation is theft!!1" and starving the beast. I don't believe that people are still buying the whole thing about poor old grandma since it's very easy to make laws specific to them, cf. https://www.cga.ct.gov/2000/rpt/2000-R-0836.htm https://www.cga.ct.gov/2000/rpt/2000-R-0836.htm
- dodobirdlord 7y ago
  > Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house? The entire point is for the price to keep going up and to eventually price people out of their longtime homes. It is the specific intent of this sort of policy to force people out of their single story homes near downtown SF. Whether you think it's good policy or bad policy can be debated, but proponents of these sorts of policies consider it bad public policy to allow scarce resources to be monopolized by people using them inefficiently, regardless of who those people are or how they came to possess those scarce resources.
kmonsen 7y ago
In this system people would not have a lot of incentive to keep improving the land. Still I can see some value in it, but there needs to be a away to feel that ownership and having value in taking care of the land.
- harimau777 7y ago
  I'm not an expert, but my understanding is that Georgists often do not advocate literally reselling the land every so many years. Rather they advocate that the value of the land be evaluated periodically and used to set a 100% property tax on that value. However, improvements to the land are not factored into the valuation. The idea then is that the owner can turn a profit by improving the land but not by simply owning the land as is.
  - AgentOrange1234 7y ago
    Over the long run, does that end up being much different than typical US property taxes? I think the US typical house pays prop taxes every year based on land + improvements. Wouldn’t this be even less of a tax?
    - rcpt 7y ago
      It would be a very high tax for the Los Angeles County Club. It would be a comparably low tax for 432 Park.
    - dodobirdlord 7y ago
      The intention of a land value tax (as this is called) is to zero out the component of property taxes based on improvements, but increase the component based on the value of the land itself. Whether this ended up being an increase or decrease in the tax rate would mostly depend on how improved the land was. If the land is very improved, this should end up being a reduction in taxes, and for mostly unimproved land it would be an increase in taxes. The intention is to encourage people who own unimproved land to either improve it or sell it to someone who will. https://en.wikipedia.org/wiki/Land_value_tax https://en.wikipedia.org/wiki/Land_value_tax
cortesoft 7y ago
Isn't property tax trying to solve that issue?
- tomjakubowski 7y ago
  Yes, but property tax is also levied on improvements, which creates a disincentive to develop primo land.

lend000 7y ago

I like the auction aspect the parent described in another comment. However I don't like the idea that the government can revoke at will and eminent domain you out of property even if you paid the tax you won at auction. For example -- what incentivizes people to take their expensive expertise, time and equipment and survey land before placing a bid at auction? If the government is going to be the only one to survey land, that's a great way to kill innovation in the field of natural resource exploration. Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house?

snidane 7y ago
Yes, many people are not comfortable about being evicted. In reality that is how majority of people and business operate because they rent from somebody else. Your apartment lease usually expires after a year and you can be 'evicted' by your landlord. Businesess have contracts for longer periods (about 10years) of time because they put more investment into it. Instead of renting from lucky private landowners, the business owners could just as easily lease from a government for 7 years. The only question really is how long the auction should repeat after. Every year would mean people would not invest much for risk of non renewal of the contract next year. On the other hand too long between auctions (such as infinite time like in present day situation) and you get huge underutilization because the lucky winner in the first auction is not pressured to sell. LVT (or this auction mechanism) is based on market price of the land in that area so it changes in time. To prevent sudden spikes in price, the valuation of land should happen in intervals of several years like I described above in the case of an auction.
- mlthoughts2018 7y ago
  I would consider “ability to be evicted” to be a great moral wrong, and that access to comfortable housing that doesn’t cause an unreasonable commute to be a basic human right on par with free medical care & education. It’s hard for me to think of a way to square this without a concept of land ownership and exclusive property rights. I guess some type of lifelong lease from the government could be OK, but some land is more valuable than other land for living, so then how to allocate the best livable land? At any rate, I do view the capability to be evicted as a moral wrong.
  - jdmichal 7y ago
    > I would consider “ability to be evicted” to be a great moral wrong, and that access to comfortable housing that doesn’t cause an unreasonable commute to be a basic human right on par with free medical care & education. These two ideals of yours are contradictory. The right to not be evicted (in order to better develop the land) can directly prevent the availability of housing with the qualities you require. With the help of zoning boards, which are really just an embodiment of their constituent land owners, isn't this more or less the sum of the housing issue in the bay area? You certainly cannot say that there's any semblance of comfortable hosting with a reasonable commute...
    - mlthoughts2018 7y ago
      I agree with you that it’s two contradictory forces, and yet I still believe either outcome is wrong. If a person can be evicted from where they live, that is wrong. Yet also if comfortable, nearby, affordable housing (that you did not need to evict others to build) is not widespread for all, that is also wrong. It’s important to focus on solutions that solve both sides of the problem, and to deny arguments that it’s functionally not possible (which would be an unacceptable outcome). I don’t mind the contradictory positions in terms of market theory and efficient allocation, and believe it’s important to pursue anyway, that this technical contradiction is fine... necessary even.
      - 7y ago
sjy 7y ago
The comment you are replying to suggested that 7-year leases could be auctioned. A lease cannot be revoked “at will.” But it does mean that people can be priced out of their homes when the lease expires. That’s the point.
- chaorace 7y ago
  Coincidentally, this is similar to the lease-hold system in Hong Kong. Most land plots revert to the government after a 75 or 99 year lease term. You can sublet land during that period, but whoever directly holds the government lease is obligated to pay an annual tax equal to a percentage of the land's rated value.
crdoconnor 7y ago
>Or will the price keep going up and price you out of your longtime house? If we don't have a problem with elderly renters getting priced out and not receiving a windfall (public concern for this issue is pretty muted) I don't see why homeowners getting priced out and receiving a windfall is worse. I always found it deeply ironic that the Howard Jarvis Taxpayers foundation successfully lobbied for prop 13 on the "won't think of the pensioners homeowners" argument and then turned around and lobbied to slash pensions... yet their propaganda still carries weight today.
- rcpt 7y ago
  If you read the stuff Howard Jarvis Taxpayers Association puts out it's mostly "taxation is theft!!1" and starving the beast. I don't believe that people are still buying the whole thing about poor old grandma since it's very easy to make laws specific to them, cf. https://www.cga.ct.gov/2000/rpt/2000-R-0836.htm https://www.cga.ct.gov/2000/rpt/2000-R-0836.htm
dodobirdlord 7y ago
> Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house? The entire point is for the price to keep going up and to eventually price people out of their longtime homes. It is the specific intent of this sort of policy to force people out of their single story homes near downtown SF. Whether you think it's good policy or bad policy can be debated, but proponents of these sorts of policies consider it bad public policy to allow scarce resources to be monopolized by people using them inefficiently, regardless of who those people are or how they came to possess those scarce resources.

kmonsen 7y ago

In this system people would not have a lot of incentive to keep improving the land. Still I can see some value in it, but there needs to be a away to feel that ownership and having value in taking care of the land.

harimau777 7y ago
I'm not an expert, but my understanding is that Georgists often do not advocate literally reselling the land every so many years. Rather they advocate that the value of the land be evaluated periodically and used to set a 100% property tax on that value. However, improvements to the land are not factored into the valuation. The idea then is that the owner can turn a profit by improving the land but not by simply owning the land as is.
- AgentOrange1234 7y ago
  Over the long run, does that end up being much different than typical US property taxes? I think the US typical house pays prop taxes every year based on land + improvements. Wouldn’t this be even less of a tax?
  - rcpt 7y ago
    It would be a very high tax for the Los Angeles County Club. It would be a comparably low tax for 432 Park.
  - dodobirdlord 7y ago
    The intention of a land value tax (as this is called) is to zero out the component of property taxes based on improvements, but increase the component based on the value of the land itself. Whether this ended up being an increase or decrease in the tax rate would mostly depend on how improved the land was. If the land is very improved, this should end up being a reduction in taxes, and for mostly unimproved land it would be an increase in taxes. The intention is to encourage people who own unimproved land to either improve it or sell it to someone who will. https://en.wikipedia.org/wiki/Land_value_tax https://en.wikipedia.org/wiki/Land_value_tax

cortesoft 7y ago

Isn't property tax trying to solve that issue?

tomjakubowski 7y ago
Yes, but property tax is also levied on improvements, which creates a disincentive to develop primo land.