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Just out of curiosity (ie. not trying to ask you a "gotcha" question), would you apply this idea to measures to reduce climate change? Oil companies and compani

Just out of curiosity (ie. not trying to ask you a "gotcha" question), would you apply this idea to measures to reduce climate change? Oil companies and companies/individuals dependent on cheap oil would presumably lose a lot. I'm not sure if their current behavior is exactly rent-seeking, but asking them to internalize their externalities is fairly close to abolishing rent seeking I think. And if your answer is yes, how would we value the economic loss they face?

ItsMonkk 5y ago
I don't know the answer to this either, but I'll at least try to give an idea on how one might get to that value. For the Land Value Tax this question is fairly straight-forward. We have the current market value(say $2.4M from the article). We need to work out the value for the land($2M from the article). That 2M is the losses if a 100% LVT is applied. You can choose to phase in the tax, or you can give a tax subsidy equal to the land value($2M), or you can flat out print money equal to the land value, and you can do some combination of all three. Of those 3, it is better to implement the full tax right away to correct the incentives as soon as possible, but long-term it doesn't matter so long as the incentives get there. One of the interesting consequences here is if you currently own a home, and understand that we are currently in a bubble, and know the consequences of 2008, you are incentivized to vote for a Land Value Tax with a one time transition subsidy, as it will lower your risk profile from another catastrophic collapse of the housing market. Similar approaches surely apply to carbon sellers, and the carbon tax and dividend is extremely close in idea as the Land Value tax with UBI. So long as people are disincentivized against using carbon, giving tax credits or cash to these companies seems appropriate.
CryptoPunk 5y ago
I would definitely apply this to oil companies as part of any CO2 emissions reduction/elimination plan. I'm not qualified to determine how to assess their expected losses, but I assume there are financial analysts that are.
radu_floricica 5y ago
In the case of current land owners we'll be changing the way they pay for what they get. Currently they pay a lump sum when they buy the land, and we're switching to a model where the land would be a lot cheaper but tax on land would be high. Not compensating them at all would have them pay twice. I'm all for breaking eggs to make omelet, but it is unfair. Polluters simply generate negative externalities. They've benefited so far by making a profit without compensating society for the harm they cause. Fair would be hitting them with backcharges. Adding various taxes and regulations to bring them closer to a net zero harm is a bare minimum. As an aside, in both cases we're talking about commons. Land owners enjoy for free the commons of being in an urban place (other people, infrastructure, access to interesting places, clients, employees and employers). Polluters hurt the commons of clean air and clean water.

ItsMonkk 5y ago

I don't know the answer to this either, but I'll at least try to give an idea on how one might get to that value. For the Land Value Tax this question is fairly straight-forward. We have the current market value(say $2.4M from the article). We need to work out the value for the land($2M from the article). That 2M is the losses if a 100% LVT is applied. You can choose to phase in the tax, or you can give a tax subsidy equal to the land value($2M), or you can flat out print money equal to the land value, and you can do some combination of all three. Of those 3, it is better to implement the full tax right away to correct the incentives as soon as possible, but long-term it doesn't matter so long as the incentives get there. One of the interesting consequences here is if you currently own a home, and understand that we are currently in a bubble, and know the consequences of 2008, you are incentivized to vote for a Land Value Tax with a one time transition subsidy, as it will lower your risk profile from another catastrophic collapse of the housing market. Similar approaches surely apply to carbon sellers, and the carbon tax and dividend is extremely close in idea as the Land Value tax with UBI. So long as people are disincentivized against using carbon, giving tax credits or cash to these companies seems appropriate.

CryptoPunk 5y ago

I would definitely apply this to oil companies as part of any CO2 emissions reduction/elimination plan. I'm not qualified to determine how to assess their expected losses, but I assume there are financial analysts that are.

radu_floricica 5y ago

In the case of current land owners we'll be changing the way they pay for what they get. Currently they pay a lump sum when they buy the land, and we're switching to a model where the land would be a lot cheaper but tax on land would be high. Not compensating them at all would have them pay twice. I'm all for breaking eggs to make omelet, but it is unfair. Polluters simply generate negative externalities. They've benefited so far by making a profit without compensating society for the harm they cause. Fair would be hitting them with backcharges. Adding various taxes and regulations to bring them closer to a net zero harm is a bare minimum. As an aside, in both cases we're talking about commons. Land owners enjoy for free the commons of being in an urban place (other people, infrastructure, access to interesting places, clients, employees and employers). Polluters hurt the commons of clean air and clean water.