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I just find something very cold and socially undesirable in the idea that somebody can spend a lifetime putting in the work to get the home they want, only to b

I just find something very cold and socially undesirable in the idea that somebody can spend a lifetime putting in the work to get the home they want, only to be forced out because "society" decides they are no longer productive. I'm no NIMBY—those people shouldn't have the right to stop others from developing their own properties—but I'm not sure I like the idea of economic incentives kicking the least productive to the curb because it's "efficient".

Aunche 6y ago
If being taxed 2.5% a year counts as being "forced out," then staying in a highly productive area of land indefinitely is "forcing" people who can otherwise move to your house to stay poor. Never mind that it's the wealthy are the ones who benefit from elimination of property taxes. It's society that makes the property valuable in the first place, so it makes sense to pay society back. The firefighters, schools, and social workers in your area need to get paid extra to account for the cost of living increases. That money should come from the people benefit the most from their services, the property owners.
- chordalkeyboard 6y ago
  > If being taxed 2.5% a year counts as being "forced out," then staying in a highly productive area of land indefinitely is "forcing" people who can otherwise move to your house to stay poor. “Otherwise” is doing a lot of work here. The people can’t “otherwise” move there because the person isn’t selling, that’s the idea. Taxing people so they are forced to sell is forcing them out. Not taxing people so they are not forced to sell is letting them stay there. You’ve yet to explain why the people who do live there have less of a claim to the house than the wealthier people who would buy it from them. > Never mind that it's the wealthy are the ones who benefit from elimination of property taxes. Yes nevermind that since its not even true. > It's society that makes the property valuable in the first place, so it makes sense to pay society back. This reifies “society” as a thing-in-itself rather than properly considering society as consisting of the people who own the properties and make them valuable by their ownership, maintenance, and use. Then it equivocates “society” with the actual government that collects the taxes and decides how they are spent (typically routing them to their friends who sell goods and services to the government). > The firefighters, schools, and social workers in your area need to get paid extra to account for the cost of living increases. Cost of living increases like land value tax? Like how landlords pass increased taxes and maintenance onto their tenants? > That money should come from the people benefit the most from their services, the property owners. Its not at all clear that property owners benefit disproportionately from social services, and they also pay for those services through taxes. I think most of this recent fascination with Georgism is a result of California tax policy and doesn’t withstand a cursory economic analysis.
  - Aunche 6y ago
    Overall, I agree with you that Georgist LVT is nonsense, but overall, I think that an LVT would be an efficient way to raise revenue. > Taxing people so they are forced to sell is forcing them out. That's still very much overstretching the word "force." If the government taxes a cigarette factory out of existence, are they "forcing" the workers to move if they need to do so to find another job? > You’ve yet to explain why the people who do live there have less of a claim to the house than the wealthier people who would buy it from them. I view this as a meaningless philosophical question. There are so many ways that life can be unfair. Being taxed into selling your home at a huge profit is just not a concern I care about. > Like how landlords pass increased taxes and maintenance onto their tenants? This is completely untrue. Rent is solely dependent on supply and demand. Demand is elastic, and supply is very inelastic and even more so in highly desirable cities, so it doesn't get very affected by a tax. If property taxes get passed down to tenants, Prop 13 would have passed the tax savings onto renters, which it clearly has not. > Its not at all clear that property owners benefit disproportionately from social services, and they also pay for those services through taxes. Financially, a renter would be fine if their home burns down, becomes surrounded by used needles, or has a terrible school district. The homeowner reaps the financial benefit from these services, so they should expect to pay a share.
    - chordalkeyboard 6y ago
      > Financially, a renter would be fine if their home burns down, becomes surrounded by used needles, or has a terrible school district. Thanks for your reply. I think this statement is a good example of how I think your reply misses the point and so I’m not sure we will come to any agreement. Thanks.
  - neilparikh 6y ago
    > You’ve yet to explain why the people who do live there have less of a claim to the house than the wealthier people who would buy it from them. You've yet to explain why the people living there have more of a claim to the land than anyone else in society. The model you've proposed is basically "first come first serve" (ie. homesteading principle). Except even that doesn't apply given that some of the land currently in private ownership was previously used by others, who were forced off it, via colonization in North America, and the enclosure acts in Europe. Should we return the land to the descendants of the Native Americans? Given that land is a scarce good, and access to good land gives substantial benefits to those with access, "first come first serve" simply isn't a workable way to allocate land. Those with land are able to charge rents to those without, and they can pass this privilege down to their heirs, keeping this inequality going. > Its not at all clear that property owners benefit disproportionately from social services, and they also pay for those services through taxes. Here's a simple example. Suppose the government decides to build a new transit line going to the edge of the city. The rents and property values along the line will increase. And in most places, income and sales taxes fund at least part of the cost. So renters will pay some of the cost, but get no financial benefit, while also paying increased rents. On the other hand, the landowners will pay some of the cost, but they'll also profit from the increased rents and land values. Essentially, renters pay "twice" for government services: once for the actual service, and then again when the existence of the service leads to higher rents, which are then reaped by landowners. > I think most of this recent fascination with Georgism is a result of California tax policy and doesn’t withstand a cursory economic analysis. Basically every economist agrees with the principles behind Georgism, starting from Adam Smith and David Ricardo, and continuing to modern economists like Milton Friedman and Joseph Stiglitz, so I don't really know what you're talking about here. You should read about the Law of Rent by Ricardo (https://en.wikipedia.org/wiki/Law_of_rent https://en.wikipedia.org/wiki/Law_of_rent), which basically states what I have said here: land rent is equal to the marginal economic advantage, which is obviously not created by the landowner.
imtringued 6y ago
> because "society" decides they are no longer productive. You have to consider the benchmark. Do people deserve to live in a castle if they aren't productive enough? Living in a single family home in the middle of NYC requires a whole lot of productivity because you are literally displacing dozens of other people. You have to be as productive as all those people combined to be worthy of replacing them.
- lambda_obrien 6y ago
  So by your accounting, if I purchase a home in Stockton, CA right now, then in 40 years when I'm old and can't afford the taxes on my lifelong home because Stockton is huge then, I'm to be kicked out for a more productive use?
  - neilparikh 6y ago
    More likely, the government would place a lien on your property, and when you die or sell your home, the profits would be used to pay for the deferred tax, rather than simply accruing to you or your heirs.
    - lambda_obrien 6y ago
      And why should the home I paid for be auctioned by the government? How is that fair for anyone but the wealthy? You're saying that only the rich can stay in one place, everyone else has to move to the middle of no where or risk losing it all to said rich folk who will buy my property at auction by the government. Seems silly to me.
      - neilparikh 6y ago
        In my original comment, I stated "when you die or sell your home", so I don't see why anyone would have to move. If you think people shouldn't have to pay extra when their land becomes more valuable, I don't see why they should still get the profits when their land becomes more valuable. That's basically socializing the costs, but privatizing the profits, which is obviously a bad thing to do.

Aunche 6y ago

If being taxed 2.5% a year counts as being "forced out," then staying in a highly productive area of land indefinitely is "forcing" people who can otherwise move to your house to stay poor. Never mind that it's the wealthy are the ones who benefit from elimination of property taxes. It's society that makes the property valuable in the first place, so it makes sense to pay society back. The firefighters, schools, and social workers in your area need to get paid extra to account for the cost of living increases. That money should come from the people benefit the most from their services, the property owners.

chordalkeyboard 6y ago
> If being taxed 2.5% a year counts as being "forced out," then staying in a highly productive area of land indefinitely is "forcing" people who can otherwise move to your house to stay poor. “Otherwise” is doing a lot of work here. The people can’t “otherwise” move there because the person isn’t selling, that’s the idea. Taxing people so they are forced to sell is forcing them out. Not taxing people so they are not forced to sell is letting them stay there. You’ve yet to explain why the people who do live there have less of a claim to the house than the wealthier people who would buy it from them. > Never mind that it's the wealthy are the ones who benefit from elimination of property taxes. Yes nevermind that since its not even true. > It's society that makes the property valuable in the first place, so it makes sense to pay society back. This reifies “society” as a thing-in-itself rather than properly considering society as consisting of the people who own the properties and make them valuable by their ownership, maintenance, and use. Then it equivocates “society” with the actual government that collects the taxes and decides how they are spent (typically routing them to their friends who sell goods and services to the government). > The firefighters, schools, and social workers in your area need to get paid extra to account for the cost of living increases. Cost of living increases like land value tax? Like how landlords pass increased taxes and maintenance onto their tenants? > That money should come from the people benefit the most from their services, the property owners. Its not at all clear that property owners benefit disproportionately from social services, and they also pay for those services through taxes. I think most of this recent fascination with Georgism is a result of California tax policy and doesn’t withstand a cursory economic analysis.
- Aunche 6y ago
  Overall, I agree with you that Georgist LVT is nonsense, but overall, I think that an LVT would be an efficient way to raise revenue. > Taxing people so they are forced to sell is forcing them out. That's still very much overstretching the word "force." If the government taxes a cigarette factory out of existence, are they "forcing" the workers to move if they need to do so to find another job? > You’ve yet to explain why the people who do live there have less of a claim to the house than the wealthier people who would buy it from them. I view this as a meaningless philosophical question. There are so many ways that life can be unfair. Being taxed into selling your home at a huge profit is just not a concern I care about. > Like how landlords pass increased taxes and maintenance onto their tenants? This is completely untrue. Rent is solely dependent on supply and demand. Demand is elastic, and supply is very inelastic and even more so in highly desirable cities, so it doesn't get very affected by a tax. If property taxes get passed down to tenants, Prop 13 would have passed the tax savings onto renters, which it clearly has not. > Its not at all clear that property owners benefit disproportionately from social services, and they also pay for those services through taxes. Financially, a renter would be fine if their home burns down, becomes surrounded by used needles, or has a terrible school district. The homeowner reaps the financial benefit from these services, so they should expect to pay a share.
  - chordalkeyboard 6y ago
    > Financially, a renter would be fine if their home burns down, becomes surrounded by used needles, or has a terrible school district. Thanks for your reply. I think this statement is a good example of how I think your reply misses the point and so I’m not sure we will come to any agreement. Thanks.
- neilparikh 6y ago
  > You’ve yet to explain why the people who do live there have less of a claim to the house than the wealthier people who would buy it from them. You've yet to explain why the people living there have more of a claim to the land than anyone else in society. The model you've proposed is basically "first come first serve" (ie. homesteading principle). Except even that doesn't apply given that some of the land currently in private ownership was previously used by others, who were forced off it, via colonization in North America, and the enclosure acts in Europe. Should we return the land to the descendants of the Native Americans? Given that land is a scarce good, and access to good land gives substantial benefits to those with access, "first come first serve" simply isn't a workable way to allocate land. Those with land are able to charge rents to those without, and they can pass this privilege down to their heirs, keeping this inequality going. > Its not at all clear that property owners benefit disproportionately from social services, and they also pay for those services through taxes. Here's a simple example. Suppose the government decides to build a new transit line going to the edge of the city. The rents and property values along the line will increase. And in most places, income and sales taxes fund at least part of the cost. So renters will pay some of the cost, but get no financial benefit, while also paying increased rents. On the other hand, the landowners will pay some of the cost, but they'll also profit from the increased rents and land values. Essentially, renters pay "twice" for government services: once for the actual service, and then again when the existence of the service leads to higher rents, which are then reaped by landowners. > I think most of this recent fascination with Georgism is a result of California tax policy and doesn’t withstand a cursory economic analysis. Basically every economist agrees with the principles behind Georgism, starting from Adam Smith and David Ricardo, and continuing to modern economists like Milton Friedman and Joseph Stiglitz, so I don't really know what you're talking about here. You should read about the Law of Rent by Ricardo (https://en.wikipedia.org/wiki/Law_of_rent https://en.wikipedia.org/wiki/Law_of_rent), which basically states what I have said here: land rent is equal to the marginal economic advantage, which is obviously not created by the landowner.

imtringued 6y ago

> because "society" decides they are no longer productive. You have to consider the benchmark. Do people deserve to live in a castle if they aren't productive enough? Living in a single family home in the middle of NYC requires a whole lot of productivity because you are literally displacing dozens of other people. You have to be as productive as all those people combined to be worthy of replacing them.

lambda_obrien 6y ago
So by your accounting, if I purchase a home in Stockton, CA right now, then in 40 years when I'm old and can't afford the taxes on my lifelong home because Stockton is huge then, I'm to be kicked out for a more productive use?
- neilparikh 6y ago
  More likely, the government would place a lien on your property, and when you die or sell your home, the profits would be used to pay for the deferred tax, rather than simply accruing to you or your heirs.
  - lambda_obrien 6y ago
    And why should the home I paid for be auctioned by the government? How is that fair for anyone but the wealthy? You're saying that only the rich can stay in one place, everyone else has to move to the middle of no where or risk losing it all to said rich folk who will buy my property at auction by the government. Seems silly to me.
    - neilparikh 6y ago
      In my original comment, I stated "when you die or sell your home", so I don't see why anyone would have to move. If you think people shouldn't have to pay extra when their land becomes more valuable, I don't see why they should still get the profits when their land becomes more valuable. That's basically socializing the costs, but privatizing the profits, which is obviously a bad thing to do.