Taxes Avoided by the Rich Could Pay Off the Deficit

[Roy L]

Does that include all the great Hong Kong fortunes,

Most of them, certainly.

and can we take that to a Hong Kong bank as well?

You can.

Or should we consider them exceptions to your Ballsack Rule, and continue to attribute those great fortunes instead to a lack of private landownership in Hong Kong?

No, lack of landownership produces more broad-based prosperity, not great concentrations of wealth. But HK offers lots of other opportunities for dishonest gain, so there are plenty of billionaires there.

 

[awake]

Ben Bernanke? Try Hank Paulson. Most of the super-duper uber-rich are scammers, rent seekers and parasites of one stripe or another, as I already showed. And in most countries it's even worse than in the USA.

Nah. "Behind every great fortune there is a great crime." -- Balzac

The greater the accumulation of wealth, the lower the probability that any significant portion of it was acquired honestly. I used to think Michael Dell was the model of a self-made billionaire. Then I found out he has been using tremendous amounts of prison (i.e., slave) labor. Dig into the sources of great fortunes, and you will find great crimes. Take it to the bank.

RoyL... From what I can gather you would use government violence to expropriate any person who had more money than you because it is an automatic crime that they have wealth; or as you quote "great fortunes = great crimes". Your position is envy parading as "justice", which it clearly is not. Have wealthy men used government to get rich. Yes. Has every wealthy man done this? Absolutely not. To write off everyone who has money as unjustly acquiring it and implying that it be confiscated, is in itself unjust.

If you expropriate the justly rich along with the 'rich by government types', you collapse the market system. You have to be a bit more surgical about it. Cut the government root and the unjustly rich wither on the branch for this is thier means an method...Monopoly government is the mechanism of corruption - one starts there.

"Taxes avoided by the rich could pay off the deficit" put another way is, 'if I have spent more than I have, its OK to take the difference from some one else' whether they agree or not. The case for theft can be made many ways, this is just one of them

 

[Roy L]

If its too expensive, how does debt help?

You can pay for it over time while using it. You know this. Why pretend you don't?

a) precisely how much land is that?

That depends on how advantageous government, the community and nature have made it. In the middle of a city where publicly provided services, infrastructure, opportunities and amenities abound, it might be very little: a tiny fraction of the land under an apartment building, say. In the country, where the gifts of nature are more important and access to government services and infrastructure more difficult, it might be hundreds or even thousands of acres.

b) ever heard of a home office?

Yes. Ever considered saying something relevant?

c) If only the rich own homes (as you have previously argued)

I haven't argued that. You are just lying. All apologists for landowner privilege lie. That is a natural law of the universe. There has never been an exception to that law, and there never will be. NEVER.

then why do they get an exemption?

They are human beings (more or less) and thus have the same rights to liberty as anyone else. The rich get the universal individual income tax exemption, don't they?

What I think you are in fact trying to solve is an entitlement mentality and a lick of saving and diligence.

No, I am trying to solve the problem of people's rights to liberty having been removed for the unearned profit of private landowners. It is not a lack of saving and diligence that has put them on the treadmill. It is the institution of landowner privilege that steals their rightful earnings and gives the money to landowners in return for nothing.

There are homes in major cities in America available for very little.

Only in the ones where opportunity is scarce, services and infrastructure decrepit, and living conditions unpleasant and/or unsafe.

Even in the most exorbitant market a home should not exceed 3-4 times ones salary

I live in an area where it is 30-40 times.

which is easy enough to save for in a few years, especially for a married couple.

Nope. That's a fabrication. Their earnings are constantly being taken from them and given to landowners, making the land more expensive even as it takes away their ability to save up and buy it. The more they earn, the more is stolen from them and given to landowners. The more the landowners are given for idly owning the land, the less reason they have to sell, and the higher the price they will demand. The productive young married couple are forced to pay for government twice so that landowners can pocket one of the payments in return for nothing. By earning enough to save $1K, they have to pay another $1K in taxes, and the price of the land rises another $1K so they are no closer to being able to buy it. That is the treadmill that powers the landowners' escalator. The landless young couple effectively have no way of ever saving up enough money to buy a home. The harder they toil on the treadmill, the faster it goes, the faster they have to run just to stay in the same place -- and the faster the landowners' escalator raises the price of land up out of reach.

 

[awake]

"landowner privilege", could you please define what you mean by this?

"All apologists for landowner privilege lie. That is a natural law of the universe." What?

Could you define property rights as they should be in your just world?

 

[Roy L]

RoyL... From what I can gather you would use government violence to expropriate any person who had more money than you because it is an automatic crime that they have wealth;

No. You are just lying about what I have plainly written. You made a conscious, deliberate decision to lie. You're lying. Stop lying.

or as you quote "great fortunes = great crimes".

It doesn't take a great fortune to have more money than me. I have stated explicitly NOT that no great fortune has ever been obtained honestly, but that the larger the fortune, the less likely it is to have been obtained honestly. IMO anyone who has read very extensively in the business section of the newspaper knows that is true.

Your position is envy parading as "justice",

No, that is a lie. I have said nothing that could honestly be interpreted as envious. To accuse those who oppose injustice of envy for its beneficiaries is the most deeply evil act any human being can commit. It is the pure, distilled essence of absolute, Satanic evil.

which it clearly is not.

It clearly is, and you are just lying about what I have plainly written.

Have wealthy men used government to get rich. Yes. Has every wealthy man done this? Absolutely not.

See my analysis of the 21 "self-made" billionaires listed by Forbes. I found that four of them could have made their money honestly.

To write off everyone who has money as unjustly acquiring it and implying that it be confiscated, is in itself unjust.

Which might be why I have done no such thing, and you had to make a conscious, deliberate decision to lie about what I have plainly written.

If you expropriate the justly rich along with the 'rich by government types', you collapse the market system.

That is why I don't propose to tax, let alone expropriate, the justly rich.

You have to be a bit more surgical about it.

I propose to be a lot more surgical, by taxing privilege and leaving rightful property alone. I would rather tax a poor man's land than a rich man's honest earnings, because the land represents opportunity the poor man is taking from the community, while the rich man's earnings represent what he contributed TO the community.

Cut the government root and the unjustly rich wither on the branch...

Nope. That claim is disproved by the massive fortunes of the unjustly rich in countries with small and weak governments.

Monopoly government is the mechanism of corruption - one starts there.

No. It is landowner privilege that is the basic engine of government corruption. If you are familiar with local politics almost anywhere in the world, you know that is true. Until you solve the problem of landowner privilege, you have to pay for government twice, AND you make it necessary for government to spend a lot of money rescuing the landless from the effects of landowner privilege. Why do you, who rail against government, want to pay for MORE government, and pay for it TWICE?

 

[awake]

No. You are just lying about what I have plainly written. You made a conscious, deliberate decision to lie. You're lying. Stop lying.

It doesn't take a great fortune to have more money than me. I have stated explicitly NOT that no great fortune has ever been obtained honestly, but that the larger the fortune, the less likely it is to have been obtained honestly. IMO anyone who has read very extensively in the business section of the newspaper knows that is true.

No, that is a lie. I have said nothing that could honestly be interpreted as envious. To accuse those who oppose injustice of envy for its beneficiaries is the most deeply evil act any human being can commit. It is the pure, distilled essence of absolute, Satanic evil.

It clearly is, and you are just lying about what I have plainly written.

See my analysis of the 21 "self-made" billionaires listed by Forbes. I found that four of them could have made their money honestly.

Which might be why I have done no such thing, and you had to make a conscious, deliberate decision to lie about what I have plainly written.

That is why I don't propose to tax, let alone expropriate, the justly rich.

I propose to be a lot more surgical, by taxing privilege and leaving rightful property alone. I would rather tax a poor man's land than a rich man's honest earnings, because the land represents opportunity the poor man is taking from the community, while the rich man's earnings represent what he contributed TO the community.

Nope. That claim is disproved by the massive fortunes of the unjustly rich in countries with small and weak governments.

No. It is landowner privilege that is the basic engine of government corruption. If you are familiar with local politics almost anywhere in the world, you know that is true. Until you solve the problem of landowner privilege, you have to pay for government twice, AND you make it necessary for government to spend a lot of money rescuing the landless from the effects of landowner privilege. Why do you, who rail against government, want to pay for MORE government, and pay for it TWICE?

Your methods are arbitrary and flaky at best, you are advocating we tax certain rich people. How? We apply the RoyL method to define who gets to keep their wealth and who gets to pay. Everyone else who disagrees is a)a liar or b) an apologist for the land privileged.

 

[idiom]

You can pay for it over time while using it. You know this. Why pretend you don't?

Saving first and then paying for land is far cheaper. If this is impossible how can paying debt and interest be easier?

I live in an area where it is 30-40 times.

Move? Why choose to live somewhere like that? Paying more than 3-4 times ones salary is irresponsible. Just give your money away. rofl. The law of supply and demand is suggesting strongly you look for a different supply.

Only in the ones where opportunity is scarce, services and infrastructure decrepit, and living conditions unpleasant and/or unsafe.

Are they lacking in rich landowners to make it safe? Why are low property values associated with a complete set of infrastructure?

That depends on how advantageous government, the community and nature have made it. In the middle of a city where publicly provided services, infrastructure, opportunities and amenities abound, it might be very little: a tiny fraction of the land under an apartment building, say. In the country, where the gifts of nature are more important and access to government services and infrastructure more difficult, it might be hundreds or even thousands of acres.

One more time, with more 'precisely'?

I haven't argued that. You are just lying. All apologists for landowner privilege lie. That is a natural law of the universe. There has never been an exception to that law, and there never will be. NEVER.

An interesting accusation. I take it then that you think the poor are landowning parasites too?

 

[idiom]

I would rather tax a poor man's land than a rich man's honest earnings, because the land represents opportunity the poor man is taking from the community, while the rich man's earnings represent what he contributed TO the community.

That is a very interesting position.

Taking even the little the poor have and re-distributing it to the rich. Yes this will create Justice!

I wonder why people object to your vision of a world where the poor can be taxed to reimburse the wealthy for not providing the opportunity for them to live in their hovels.

That claim is disproved by the massive fortunes of the unjustly rich in countries with small and weak governments.... It is landowner privilege that is the basic engine of government corruption.

Geonomists may disagree with you there...

Land rent makes the Kuomintang (KMT), the corrupt ruling party that has been in power since Chiang Kai-shek took refuge on Formosa over fifty years ago, the richest political party in the world. Not only does the KMT own about a quarter of the island's economy legally, they also collect an enormous amount of graft.

 

[Roy L]

"landowner privilege", could you please define what you mean by this?

Landowner privilege has two main components:

1) the legal entitlement to profit from the forcible removal of others' liberty to use the land, and

2) the legal entitlement to charge others full market value for access to the government services and infrastructure that their taxes already paid for -- i.e., effectively to pocket other people's taxes.

"All apologists for landowner privilege lie. That is a natural law of the universe." What?

The only way to rationalize, justify and excuse evil is by lying. Landowner priviege is the greatest evil in the history of the world. Therefore, apologists for landowner privilege have to lie. ALWAYS.

Could you define property rights as they should be in your just world?

All valid rights are founded on the non-deprivation principle: people have a right to what they would have if others did not forcibly deprive them of it: chiefly life, liberty, and property in the fruits of their labor. Rightful property therefore consists of the fruits of one's labor (including the fruits of others' labor obtained by consensual transactions), which others would not otherwise be at liberty to use, and that others cannot take or possess without depriving one of what he would otherwise be at liberty to use.

 

[Roy L]

Saving first and then paying for land is far cheaper.

No, it is not, because the land is rising in value -- roughly in pace with GDP -- while you save up for it. That is why almost all land purchases are made using mortgage debt.

If this is impossible how can paying debt and interest be easier?

Because the price doesn't keep rising while you are paying it.

Move? Why choose to live somewhere like that?

Because it is extremely desirable. Do you really think you know better than the market?

Paying more than 3-4 times ones salary is irresponsible.

Nonsense. It depends on how productively you will use the location.

Just give your money away. rofl.

I am FORCED to give it away, in taxes, to landowners. That is why land costs so much: its owner is privileged to pocket other people's taxes.

The law of supply and demand is suggesting strongly you look for a different supply.

No, it is not. It is suggesting that you do not know any economics.

Are they lacking in rich landowners to make it safe?

Rich landowners don't make a place safe, as Pakistan and many other highly unsafe societies based on landowner privilege prove. Rather, a place being safe (and having other publicly provided advantages) is what makes its landowners rich. You're just spewing stupid, dishonest nonsense.

Why are low property values associated with a complete set of infrastructure?

They aren't. Why are you lying about what I have plainly written?

One more time, with more 'precisely'?

It depends, very precisely, on how advantageous land at the citizen's chosen location is. At a rough cut, call it the amount of land there that is worth 20% of per capita land value for the relevant jurisdiction.

An interesting accusation. I take it then that you think the poor are landowning parasites too?

The poor rarely own land, and even more rarely do they own more than the fair share they need to sustain themselves (~20% of per capita land value). You know this. See how you have to lie?

The dishonesty of your posts is palpable.

 

[Roy L]

That is a very interesting position.

You are just unaccustomed to it because it is factual.

Taking even the little the poor have and re-distributing it to the rich. Yes this will create Justice!

You again prove that you have to lie about what I have plainly written. Taxes are redistributed to landowners, not the rich, so what the poor landowner pays in taxes he is getting back as a landowner. The rich just happen to also own most of the land, which is why they get rapidly richer without lifting a finger, while productive working people toil on the treadmill and get nowhere.

I wonder why people object to your vision of a world where the poor can be taxed to reimburse the wealthy for not providing the opportunity for them to live in their hovels.

You again prove that you have to lie. The advantageous opportunity of which the landowner (rich or poor) deprives others (rich or poor) is to use the land, not the improvements thereon, and the tax a poor landowner pays is not used to reimburse the wealthy, it comes right back to him in the desirable government services and infrastructure he is enabled to access through using the land -- and which typically give it its value.

Geonomists may disagree with you there...

No; despite the explosive growth Taiwan has achieved by taxing land, there is still ample landowner privilege there to feed corruption. The Chinese cultural traditions of political corruption and landowner privilege are extremely deep and ingrained. 30 years of Maoism in the PRC barely scratched them, as China's history in the last 30 years has proved.

 

[Roy L]

Your methods are arbitrary and flaky at best,

No, my methods are supported by many of the greatest minds that have ever lived, including Nobel laureates in economics like Milton Friedman.

you are advocating we tax certain rich people. How?

By taxing the privileges that made them rich, keep them rich, and enable them to get rapidly richer without lifting a productive finger.

We apply the RoyL method to define who gets to keep their wealth and who gets to pay.

Because if we can find a willingness to know self-evident and indisputable facts of objective physical reality, we can distinguish just from unjust wealth and recover the latter from those who have taken it. Right.

Everyone else who disagrees is a)a liar or b) an apologist for the land privileged.

Your b is a subset of a, so it's not either/or.

 

[Roy L]

You are confusing margin compression and price equilibrium.

No, you are confusing the economics of elastic supply with those of fixed supply.

If adding the tax simply pushes the market equilibrium point up, then the tax has effectively been passed directly on.

But a tax on land can't do that, because supply is fixed. The owner can't affect demand, and he can't affect supply, so he can't affect price.

If the market equilibrium point won't go up then margin compression will wipe out swathes of the supply

Oh, really? Taxing land will cause it to fall into the sea? Or do you think that the more expensive it gets to hold land vacant, the more of it landowners will hold vacant?

It is time for you to stop typing and start thinking.

until margins return on a lower cost structure. And the rent has been passed on.

See above. Economists have known for 200 years that a tax on land cannot be passed on.

If the tax is hiked high enough in the belief that business and markets do not account for operating costs and market cannot bear more then supply will end.

You mean the earth will vanish? Or will landowners consent to pay the entire cost of government out of their other assets in return for the privilege of keeping land vacant and unused?

Think hard.

Landowning is the same as any other business,

Oh, really? Then what is its product? It can't be the land, as that was already there, ready to use, with no help from the landowner or anyone else.

Right about now your mouth should be hanging open, as you realize what a fool you have made of yourself.

if the margins are too small you change business.

Ah. But that is exactly what we want landowners to do: change their business and stop robbing us. I have posted this many times before, and no one has ever been able to refute it. You won't, either:

The Bandit

Suppose there is a bandit who lurks in the mountain pass between two countries. He robs the merchant caravans as they pass through, but is careful to take only as much as the merchants can afford to lose, so that they will keep using the pass and he will keep getting the loot.

A thief, right?

Now, suppose he has a license to charge tolls of those who use the pass, a license issued by the government of one of the countries -- or even both of them. The tolls are by coincidence equal to what he formerly took by force. How has the nature of his enterprise changed, simply through being made legal? He is still just a thief. He is still just demanding payment and not contributing anything in return. How can the mere existence of that piece of paper entitling him to rob the caravans alter the fact that what he is doing is in fact robbing them?

But now suppose instead of a license to steal, he has a land title to the pass. He now charges the caravans the exact same amount in "rent" for using the pass, and has become quite a respectable gentleman. But how has the nature of his business really changed? It's all legal now, and he can even pretend that his profits come from his "property rights," not just a special government-issued license. But in fact, he is still just taking money from those who use what nature provided for free, and contributing nothing whatever in return, just as he did when he was a lowly bandit. How is his "business" any different now that he is a landowner?

And for that matter, how is any other landowner charging rent for what nature provided for free any different?

Do the merchants, by using the pass when they know the bandit is there, agree to be robbed? Does their "free choice" to use the pass make the robbery a consensual transaction?

If there were two, or three, or 300, or 3 million passes, each with its own resident bandit, would the merchants' being at "liberty" to choose which bandit robs them somehow make the bandits' enterprises a competitive industry in a free market?

 

[Roy L]

Not if he doesn't type them there. (setting aside for a moment your generic lay use of an actual legal term that has specific meaning)

The legal term comes from the factual concept.

Until "public-ized", all new privately developed ideas, new knowledge or discoveries, by their nature begin as private property.

It is when they are in someone else's mind that they can't be your property. As much as you would like to, you can't own the contents of other people's minds, sorry.

Like many owners of many firms, I opt to keep those ideas that give me competitive advantages completely out of the public domain.

And that's your prerogative. But once it is in someone else's mind, your exclusive possession of it is at an end.

There is nothing to prevent others from having these very same ideas, of course, or even placing them into the public domain themselves.

BINGO! That is what makes it property and not privilege: it has NO EFFECT on others' exercise of their rights to liberty.

But until that happens, they are my trade secrets - my property - my economic advantages - alone. The world at large is entitled to absolutely nothing, save the opportunity to pay for the fruits of my superior labors, as I seek to recoup (and even profit from) the costs of REAL WORK performed, and time, money and energy expended on research, experimentation and development of specific knowledge to aid me in my pursuits.

Like any other valid property that others have to pay for, but unlike privilege, does not deprive them of any liberty they would otherwise have.

That is not to give away to everyone (and specifically my competitors) for free so that Roy L's collectivist sensibilities can be pleased.

You again choose deliberately to lie about what I have plainly written.

Those ideas, those secrets, appear only indirectly in the market as improved processes and products.

That is how my ideas (which are typed, but only privately) are not only my property, but always were.

Because your exclusive possession and use of them does not deprive others of any liberty they would otherwise have. If you just take a powder, others are no better off. Others ARE better off if the owners of land titles, patents, copyrights, etc. just take a powder. That is the difference between rightful property and unjust privilege.

They began that way. They were not "turned into" property by government fiat, or IP laws, but rather human nature, and the capacity of individuals to seek out and obtain competitive KNOWLEDGE advantages in a free market. And that "trade secret" process has been going on for thousands of years, and will continue to be practiced with or without IP laws. And nothing wrong with that at all.

And I agree. Just don't imagine you can sell knowledge and ideas to the public, but still keep them private.

 

[Zippyjuan]

But a tax on land can't do that, because supply is fixed. The owner can't affect demand, and he can't affect supply, so he can't affect price.

The price of land is still set by supply and demand. The supply is not the total supply of land in the world (which does not change unless say a volcano rises out of the sea or waters are drained to create more) but the supply available for purchase and the demand for purchasing that land at a given point in time. Values of land go up and down all of the time.

See above. Economists have known for 200 years that a tax on land cannot be passed on.

Only if you have prefectly elastic demand can taxes not be passed on. That means that the demand for land go to zero if the price is raised at all. Property taxes get added on to the rent if the owner leases the land out. Otherwise, at least some if not all of the taxes can be passed along. If I am renting out the land for say apartments, I will add the tax to the rent I charge. If I am a business or farm producing something, I will add it to the costs of whatever it is I am producing. If I am simply owning and occupying it, then yes, I am unable to pass the tax along. But I will include the costs of the tax in my decision to purchase or not to purchase the land and see if I can afford it or not. In that sense, though, the tax is again passed along. It lowers the price I would be willing to pay for the land since it is added to my costs. If, for example, I decided I could afford to pay $1000 a month towards a place to live and wanted to buy one, without a tax, I would look at property where my payments for ownership were $1000. But if there was a monthly tax of $200, then I am only going to consider properties where my costs would be $800 instead of $1000.

If the tax is hiked high enough in the belief that business and markets do not account for operating costs and market cannot bear more then supply will end.

You mean the earth will vanish? Or will landowners consent to pay the entire cost of government out of their other assets in return for the privilege of keeping land vacant and unused?

You are right- the supply will not disappear- if taxes get too high the demand for owning land will go down. The other side of the supply/ demand equation. It could effect sellers too- if the demand is less, they may have to lower their asking price or take the property off the market (which reduces the supply- the supply available for purchase at a given moment).

 

[Steven Douglas]

WARNING - SLIPPERY DISHONEST SEMANTICS ALERT

But a tax on land can't do that, because supply is fixed. The owner can't affect demand, and he can't affect supply, so he can't affect price.

Roy employs an extremely (but conveniently) distorted, intellectually dishonest view of both supply and demand where land is concerned, but especially supply.

When referring to land, Roy doesn't use the economic definition of supply. The actual economic definition of supply is the quantity (area/parcel/etc.,) that sellers are able and willing to sell, at a given price (over a given period of time). All those variables are required to determine "supply".

When Roy refers to supply, he means the total land area in existence, all of which is presumed to be "on the market", with all owners presumed to be sellers, all of which are both able and willing to sell. Roy uses this twisted, non-economic semantic shell game reasoning to argue for inelasticity and absolute fixity of land supply, and this is why, he argues, that owners/sellers "can't affect supply" -- even though the actual economic supply of land is anything but inelastic, and sellers can and do affect supply, and ultimately market price, individually and in the aggregate, every day in the real estate market.

Roy's "inelastic supply" reasoning could be said to be logically consistent, or have some bearing on reality, IF you begin from his presumption of the state as the lone "seller" (of LVT rental contracts). Then you are referring only to the "RENTAL" supply, with the state having arrogated all land/land rents as common property under a geoist regime. Under that paradigm, and assuming no minimum floor price is in effect, and assuming literally ALL land was indeed available to the market, land 'rental' supply could (in theory) be considered truly inelastic, with a supply curve that is perfectly vertical, as that is a case where the "seller" (the state) is willing to rent/sell/make all land available (for rent) to the market -- at any (LVT) price over any period of time.

 

[awake]

No, my methods are supported by many of the greatest minds that have ever lived, including Nobel laureates in economics like Milton Friedman.

By taxing the privileges that made them rich, keep them rich, and enable them to get rapidly richer without lifting a productive finger.

Because if we can find a willingness to know self-evident and indisputable facts of objective physical reality, we can distinguish just from unjust wealth and recover the latter from those who have taken it. Right.

Your b is a subset of a, so it's not either/or.

Why tax a privilege? As if that can even be done. Why not abolish it?

Milton Friedman is great because he won a Nobel? Obama did too. Milton Friedman liked government economic intervention which is why I don't like Milton Friedman. He was a statist and inflationist which makes him a false free market defender - a poser. You should get a better economist to agree with.

Your system doesn't make any practical sense and endorses the idea of taxation as a means to correct government privilege; treating the symptom of the problem and ignoring the cause. You have a difficulty in explaining your plan because its not any plan that is compatible with economic liberty at all.

This forum is about getting the government out of our lives; you are recommending ways to employ it. Liberty will not come from government, it is a irrefutable contradiction.

 

[flynn]

Roy L just never realizes that the government is the biggest corporation of them all. Please stop wasting your time educating him.

 

[MattintheCrown]

WARNING - SLIPPERY DISHONEST SEMANTICS ALERT



Roy employs an extremely (but conveniently) distorted, intellectually dishonest view of both supply and demand where land is concerned, but especially supply.

When referring to land, Roy doesn't use the economic definition of supply. The actual economic definition of supply is the quantity (area/parcel/etc.,) that sellers are able and willing to sell, at a given price (over a given period of time). All those variables are required to determine "supply".

When Roy refers to supply, he means the total land area in existence, all of which is presumed to be "on the market", with all owners presumed to be sellers, all of which are both able and willing to sell. Roy uses this twisted, non-economic semantic shell game reasoning to argue for inelasticity and absolute fixity of land supply, and this is why, he argues, that owners/sellers "can't affect supply" -- even though the actual economic supply of land is anything but inelastic, and sellers can and do affect supply, and ultimately market price, individually and in the aggregate, every day in the real estate market.

Roy's "inelastic supply" reasoning could be said to be logically consistent, or have some bearing on reality, IF you begin from his presumption of the state as the lone "seller" (of LVT rental contracts). Then you are referring only to the "RENTAL" supply, with the state having arrogated all land/land rents as common property under a geoist regime. Under that paradigm, and assuming no minimum floor price is in effect, and assuming literally ALL land was indeed available to the market, land 'rental' supply could (in theory) be considered truly inelastic, with a supply curve that is perfectly vertical, as that is a case where the "seller" (the state) is willing to rent/sell/make all land available (for rent) to the market -- at any (LVT) price over any period of time.

Take it away, Henry George:

That taxes levied upon Land Values, or, to use the politico-economic term, taxes levied upon rent, do not fall upon the user of land, and cannot be transferred by the landlord to the tenant is conceded by all economists of reputation. However much they may dispute as to other things, there is no dispute upon this point. Whatever flimsy reasons any of them may have deemed it expedient to give why the tax on rent should not be more resorted to, they all admit that the ‘taxation of rent merely diminishes the profits of the landowner, cannot be shifted on the user of land, cannot add to prices, nor check production.

Not to multiply authorities, it will be sufficient to quote John Stuart Mill. He says (Section 2, Chapter 3, Book 5, “Principles of Political Economy”) “A tax on rent falls wholly on the landlord. There are no means by which he can shift the burden upon anyone else. It does not affect the value or price of agricultural produce, for this is determined by the cost of production in the most unfavorable circumstances, and in those circumstances, as we have so often demonstrated, no rent is paid. A tax on rent, therefore, has no effect other than its obvious one. It merely takes so much from the landlord and transfers it to the State.”

The reason of this will be clear to everyone who has grasped the accepted theory of rent—that theory to which the name of Ricardo has been given, and which, as John Stuart Mill says, has but to be understood to be proved. And it will be clear to everyone who will consider a moment, even if he has never before thought of the cause and nature of rent. The rent of land represents a return to ownership over and above the return which is sufficient to induce use—it is a premium paid for permission to use. To take, in taxation, a part or the whole of this premium in no way affects the incentive to use or the return to use; in no way diminishes the amount of land there is to use, or makes it more difficult to obtain it for use. Thus there is no way in which a tax upon rent or Land Values can be transferred to the user. Whatever the State may demand of this premium simply diminishes the net amount which ownership can get for the use of land, or the price it can demand as purchase money, which is, of course, rent or the expectation of rent, capitalized.

Emphasis mine. This isn't rocket science. Taxing land will not reduce its supply, nor will it increase demand. The owner of the land will bear the full burden of the tax. Hey Henry, can you give a hypothetical?

Here, for instance, is a piece of land that has a value—let it be where it may. Its rent, or value, is the highest price that anyone will give for it—it is a bonus which the man who wants to use the land must pay to the man who owns the land for permission to use it. Now, if a tax be levied on that rent or value, this in no wise adds to the willingness of anyone to pay more for the land than before; nor does it in any way add to the ability of the owner to demand more. To suppose, in fact, that such a tax could be thrown by landowners upon tenants is to suppose that the owners of land do not now get for their land all it will bring; is to suppose that, whenever they want to, they can put up prices as they please.

Ah, thanks. As you can see from the though experiment, to suppose that landowners could pass on the LVT is to suppose that landowners are not getting all they can now for their land. But generally, they are. If a tax were to be assessed on their land -by value- the would simply get less, because there'd be no reason for buyers to pay more; the tax in no way adds to landowners' bargaining power.

 

[MattintheCrown]

Why tax a privilege? As if that can even be done. Why not abolish it?

Because the privilege of exclusive use of an area of land is necessary to our way of life. To do away with private tenure of land would be to do away with fixed improvements. Obviously, that's not beneficial to society. The solution, then, is to have the beneficiaries of the privilege compensate those who are deprived as a result of the privilege; ie, the landowner compensates the rest of society, who now must do without use of that location.