Really? By owning capital, he creates the capital. Interesting theory.
What would stop the producer from simply using the capital, if the capital owner left the scene? Would his machine tools cease to exist without him?
Why is that? Could you explain it to us?
The owner chooses anyone who may substitute for him in making decisions. That choice of who to appoint as manager, or who to lease to, is a critical decision and may be good or bad. The owner is thus still the ultimate risk-bearer and decision-maker. That is, he is an entreprenuer.
Bingo. And proving you wrong is horrible and wicked, and anyway it never happened, ever...
Because the landowner will lose money if he does not permit the most appropriate and productive use the market has decided on.
The only way to do that is by recovering their value from landowners, who get to pocket it.
Sorry, that can't work because people will shirk paying for things they can't be deprived of if they don't pay. You are comprehensively and immutably ignorant of the economics of public goods.
It's not immoral if the landowners who get all the benefit are.
Sorry, but it is a known fact of economics that the private market cannot invest efficient amounts in public goods. It is merely a fact that is not known to you, because you do not know any economics.
Except by comparison with no government.
There. Fixed it for you.
Sales tax, income tax, payroll tax, etc. Hello?
Better producers should do it, rather than parasites.
Right, because a free market would not include massive government welfare subsidy giveaways to landowners.
And no one would be able to go anywhere. How many roads have private entrepreneurs built in Somalia?
It's only a distortion because the landowners who pocket all the benefit are not asked to pay for what they get.
Silliness. How's that morning commute in Mogadishu workin' for ya?
Brainless name calling doesn't persuade.
Nope. Toilet paper is a private good. You just do not know any economics. None.
There can be no landowning in a free market other than empty, formal landowning, because any other kind is inherently a welfare subsidy to the landowner, and there is no place for welfare subsidies in a free market.
But if it is land he owns, he also misses out on risk and trouble:
Land rent goes to the incompetent and non-beneficial landowner just the same as the competent and beneficial one -- but at less risk.
No, because the more they benefit the community, the higher the land rents go and the less property they can afford.
Nope. Too bad the economic ignorami who make such puerile claims are unable to account for the fact that the Duke of Westminster, one of the richest men in Britain, is the heir of a long line of idlers who did nothing but collect land rent and use it to buy up more land.
You hate, fear, and oppose real freedom.
Garbage. What right has he to deprive others of their liberty without making just compensation?
Of course. The use to which that land is put affects everyone around it.
Not so much: the Borg is highly intelligent.
And maybe you will say and believe ANYTHING WHATEVER in order to avoid knowing the self-evident and indisputable facts of objective physical reality that prove your beliefs are false and evil.
A totally free market requires abolishing the welfare subsidy to landowning.
By BUYING (or producing) capital, he creates the capital. Even if he does not produce it himself, his purchase of it initiates and enables its creation, either directly or indirectly. His devotion of his purchasing power to its production makes available an aid to further production that would otherwise not have existed or been available to production.
Nothing. But unlike the landowner, if the capitalist had never been on the scene in the first place, his gift to the producer would not be there to use.
They would never have existed in the first place without him, or someone he paid to make them.
Holding a power to stop production and not doing so is not the same as being productive, sorry.
And would be made just as well or even better by the market, had the landowner never existed.
Like a protection racketeer. Sorry, but exercising a power to allow or not allow productive activity is not the same as actually engaging in productive activity.
Garbage. The manager is responsible, as proved, repeat, PROVED by the fact that if the restaurant fails, it will be the manager who loses his position, not the owner.
More stupid garbage from you. The land's value is already there, like the land, ready to use, with no help at all from the owner or anyone else; and the market will tell him how it can be used most profitably, by means of the high bid from among the prospective users. The restaurant, by contrast, had to be created by labor, either the owner's labor or the labor of someone he paid to create it, and the market will not tell him how to make it profitable.
What labors? The landowner performs no labor. He just pockets the high bid and (at best) stays out of the producer's way. And far from being wrong or harmful, recovering publicly created land value for public purposes and benefit is one of the most reliable ways to reduce injustice and supercharge an economy.
The restaurant owner created something, if only by initiating and enabling its creation through his investment. The landowner did not.
Not to you, because you refuse to know facts of economics.
Thanks!
The Default position is not anarcho-capitalism. I do not have the burden of proof showing that my system is better than yours in order to dethrone the reigning champion anarcho-capitalism. Because anarcho-capitalism is not the reigning champ. Its scarcely possible, and I think Nozick does a good job showing that its impossible. And I've read Rothbard's response to Nozick and Rothbard loses the argument, he has no argument actually. So I don't think your system can even exist, for one thing. Yet even if it were possible, you'd still have the burden proving its better with regard to land use, and it simply isn't. Your argument thus far is that profit drives land use in an anarchic society. Well guess what? Profit drives land use in a Geoist society. So that argument is awash.
I didn't want you to feel like you had any burden of proof, I just wanted an explanation of why instituting LVT would increase the efficiency of land allocation, not necessarily compared to an-cap or compared to anything in particular, but at all. This explanation you have provided in this post, for which I thank you very much. Any spark of intelligence is such a breath of fresh air in the stifling atmosphere that is reading Roy L.
Rothbard is not the only one to defend an-cap against its detractors. Nozick is not even a particularly strong detractor. There are gigabytes and even terabytes by now of books, lectures, articles, and videos on Mises.org explaining why an-cap is the bomb-diggity. If you want to talk about it, start a thread! There are certainly a lot of interesting aspects to discuss. Or at least post a specific statement from Nozick that you want to dare us to refute.
So, the logic is: add a tax into the expenses of a land owner, and he will use the land more productively. Why? Because the very moderately profitable use of the lazy, stupid land-steward, will no longer be profitable with an LVT. If you're incompetently making 5% profit on the land, but the LVT is 6%, then actually you're making a loss now and will have to either get your act together or sell your monopolization rights to the smart, motivated guy who can make at least 7%. Without an LVT, you could have gone on indefinitely making 5%, or even 1%, and depriving the economy of that extra potential productivity.
Call it geoist if you need a term. It's just a world where government by and for the people makes a serious effort to secure the equal, natural human rights of all. Natural rights are correctly understood as the things one would have if others did not forcibly deprive one of them: mainly life, liberty, and property in the fruits of one's labor. The liberty people have a right to is thus correctly understood as the liberty they would have if others did not deprive them of it: the liberty to use the resources of the earth that nature provided for all, and to deal with their fellows by mutual consent.
This thread is all about the solution: land value taxation (or more generally, recovery of the publicly created rent of land for the purposes and benefit of the public that creates it) and abolition of all the unjust and harmful taxes that burden production and exchange. I would only add that restoration of the individual human right to liberty via a uniform, universal individual exemption to the land value tax, ensuring free, secure tenure on enough good land of the individual's choice to live on and participate in society must also be part of the solution. I have only attacked ignorant and dishonest derogation of this self-evidently just and moral plan.
It would look a lot like this world, but with much more liberty, justice and prosperity.
You feel stifled by me because I won't let you get away with the bull$#!+ that has been your stock in trade your whole adult life.
Sprawl is bad because it wastes resources.
So as a child, you were not thoughtful enough to ask yourself how it could somehow be more profitable for the developer to pay a premium for good farmland, and put roads, water lines, power lines, etc. on it, and then build houses on it, rather than to build the houses on vacant or underutilized lots in town that already had the roads, water, power, etc. in place.
Why is it more profitable to build 1000 houses on good farmland rather than 1000 apartments in a few towers in town?
I.e., to pay attention to what the market is telling him.
Correct, because as a landowner he would also be reigning over other individuals, depriving them of their liberty to do better than he.
The market is reliably more intelligent than one single man.
That depends on the tax. Pressuring him with the market signal of LVT DOES increase efficiency.
No, it is not the right amount, nor the free market amount, because it includes the welfare subsidy giveaway to the landowner. As long as his land is rising in value at a faster rate than the property tax rate, why would he sell? Why would he EVER sell?
It is the landowner who is committing the ongoing theft, sunshine, and don't you forget it.
Garbage with no basis in fact.
Oh. My. God.
There is no such thing as a free market in rent seeking.
Competence in rent seeking. Not production.
Garbage. You end up with rampant inefficiency as speculators try to grab publicly created value for themselves. The point of rent seeking behavior is that it tends to expand to absorb all the rent.
More stupid garbage with no basis in fact. You forgot the speculators holding land vacant in the towns, pushing development out into the farmland where it is inefficient and doesn't belong.
You misspelled, "greedy, idle parasites."
Nonsense. The first to sell are those who weren't using the land anyway. LVT encourages the most productive use, so the land boom never gets off the ground: builders are fully occupied building on vacant and under-used land in town, and no one is fool enough to offer much above recent market rates for farmland that will not be needed. The bubble values you are talking about happen NOW, under the CURRENT system, not under LVT. Everywhere LVT has been tried, the result is the same: compact, efficient development; no land price bubble; no stampede to sell.
Now you are just being silly. A million in taxes is a million in land rent. That implies the diner's site would be worth about $20M in the absence of LVT. REALLY?? With thousands of empty acres all around it?
Stupid nonsense refuted above. Many will simply take advantage of the opportunity to expand their businesses. Remember: LVT is limited to what someone is willing and able to pay for the site. The locals are generally going to have a better idea of how to take full advantage of local conditions.
With LVT, you'll get the right amount.
Possibly, if that is what the market wants.
Silliness.
Garbage with no basis in fact.
So? I told you that you hated and feared real freedom.
We've seen it happen lots of times without LVT. Where has it ever happened WITH LVT? Remember, LVT also recovers the value of depletable natural resources like oil, gold, copper, etc., so the mad scramble to grab the resource never happens, and the ghost town never happens. There is just a measured, gradual, efficient and rational exploration, identification and extraction of the resource as it becomes economic to extract it.
But WITH LVT, their opinions are not animated entirely by a feeding frenzy of rent seeking.
Wrong. LVT removes the parasites' feeding frenzy, replacing it with a requirement to contribute something to production if you want to make money.
Wrong AGAIN. LVT means the correction is smaller, and happens faster.
Not the parasite who wants something for nothing, anyway.
The market.
And I say you are a name-calling apologist for feudalism.
"Parasites."
No, you have too much power. That's why you always f*ck things up, like the rent-seeking Wall Street parasites who screwed over the entire world in their frantic greed to stuff trillions into their own pockets.
But have to pay a lot more tax...
"Parasites."
You can't afford them either, because you are not productive.
No, you're not. You'd go broke without your welfare subsidy giveaways.
Nope. You won't, because you can't make any money by building housing. You only make money by pocketing welfare subsidies.
Wrong. That has never happened anywhere LVT has been tried.
If there was an LVT, presumably they would not be greedy, all greed is irradicated of course if we have LVT, they would not be idle, because no one is ever idle if there's LVT, and they would not be parasites, because they would be paying LVT, which somehow magically ("by definition", perhaps, that's been a faithful fall-back for you so far!) would be set at the perfect rate to exactly zero out their parasitic benefit. They would also not be the absolute owners of the land. Matt used the term steward. I went with it. Seemed fair enough.
Yes, I think it's a form that has proved its value, though in many cases legacies of colonial borders have made them unjust, and ungovernable under democratic rules.
No, I don't believe in the Single Tax (another reason I don't call or consider myself a Georgist). I would favor taxes on other forms of privilege (if they can't be abolished), on depletion of natural resources (severance tax), Pigovian taxes to recover the costs imposed on the community by private actions like smoking and drinking, user fees where they are efficient, etc.
LVT most appropriately funds goods that are more accessible from certain locations, and thus add to land value. There is no need to restrict it to public goods in the technical sense. Some services and infrastructure are natural monopolies, and can't be provided efficiently by the private sector.
Part of the purpose of the individual land tax exemption is to reduce or eliminate the need for pensions and income support. People have a right to liberty, not to money. Orphanages and other child-protection programs would still be provided, though probably much less needed once the relentless financial duress imposed by landowning was removed.
Right.
Banks would be merchant or investment banks engaged in financial intermediation, not creators of demand deposits. Money would be issued to the Treasury by the Mint, in quantities calculated to keep prices stable or very slowly rising.
I don't know about the Constitutional side, and don't support banning all taxes but LVT. The main thing is to make the legitimate functions of government self-financing by recovering the land value its spending on services and infrastructure creates.
Yes, its value is just dominated by pre-paid rent and/or long-term tenure agreements, rather than the privilege of pocketing future rents.
I envision a system whereby people can pre-pay rent for up to say, 10 years, or lock in rent indexed to GDP for 50 years, for a modest fee. The outside bidder's higher offer just increases the measure of market rent. If he wants the title, he has to buy it from the holder.
Market data, probably using a computer model. The model and data would all be public, and subject to appeal and amendment. Anyone would be able to check the assessments for themselves.
Pretty much.
I would prefer full disclosure.
Some is probably necessary.
Not needed if people have their rights.
Neither.
Of course not.
Yes.
They might still be greedy, but they would not be able to rob the productive by owning land.
They might be idle, but they wouldn't be forcing idleness on others.
There is nothing magical about measuring market rent. What do you think landlords and tenants both do? And zero tolerance is unscientific nonsense.
Well, you confused me with a contradiction:
The second can't happen with the first, so I assumed you didn't know what the first meant. The lower bound of a "hefty" land tax is more than the expected land value increase. That eliminates any possibility that property values could "skyrocket" anywhere, or even rise very much.
This seems to preclude the possibility of massive sudden changes in expectations. Do you not agree that we live in an uncertain world? I can already answer for you: you think that LVT is going to smooth out and take care of a lot of that uncertainty. As you wrote, "Remember, LVT also recovers the value of depletable natural resources like oil, gold, copper, etc., so the mad scramble to grab the resource never happens, and the ghost town never happens. There is just a measured, gradual, efficient and rational exploration, identification and extraction of the resource as it becomes economic to extract it." So there are no sudden massive oil discoveries if we have an LVT. LVT solves all of that. Everything just goes along on a smooth, steady, even, predictable keel.
No, it just precludes the economic disruptions and discontinuities associated with massive sudden expectations of grabbing unearned wealth.
Yep. It removes a large element of positive feedback: prices rising in expectation of rising prices, and falling in expectation of falling prices.
The massive discoveries would still happen (maybe not quite as early), but the mad rush to grab it first never happens.
Removing positive feedback doesn't make things entirely predictable, but it does remove the violent gyrations.
Another day another thread. Our views are already so similar whats the point? Its an anarchist and a geoist arguing over some minutiae. I don't want you to think I'm a litmus test poster solely on these forums to advocate geoism. I have, as a matter of fact, commented on and started several other threads having nothing to do with geoism in my short history here. I'm a regular poster since 2007 at Ann Coulter Online. Corresponding with you, let me tell you, THAT is a breath of fresh air!
That is correct. However, this line of thinking ignores a critical argument on which Geoism rests. Let us consider my earlier example of farming in Manhattan. Farming is obviously not going to work in Manhattan with a LVT. Some type of high-density commercial or residential use is compelled by the LVT. Yet LVT does not specify anything beyond this. LVT merely sets a baseline threshold for what the owner must do. It might be that in Manhattan all that is required to meet this threshold is a 4-story building with 90% use of available acreage. If the owner constructs a 50 story high-rise, all of the surplus will accrue to him.
Let me offer the pithy and trite observation that with LVT there probably be a lot less sprawl and lot fewer million dollar subdividisions! Let me say too that local farming and sustainable local produce and all that stuff which is so en vogue today, the reason it does not work well is because our cities resemble Atlanta or Houston and not Manhattan or San Francisco. Large, sprawling, suburbanized cities make it hard for your beet farmer on the edges of town to stay in business. There is no center square or no place that large #’s gather. He is instead forced to make the rounds selling to grocery store chains, driving around a lot, its very hard. You should visit Union Sq. in Manhattan. On most days of the week you will find it teeming with farmers selling out of their stands to huge crowds. Its called economy of scale.
I think it is wrong of you to call it pressure. Incentive maybe, yes, but not pressure. As for calling it theft, I think that is unfair. This is not an uncompensated taking of land. If the tax is high and the farmer can’t afford it there is good reason. We can assume there are a number of buyers waiting in line to pay the higher price for the land. The owner is lucky to be in such a position! With the money earned he can double his acreage at a different site and farm even more. I respect that people have sentimental attachment to land in some cases were born there and inherited. If that is an argument you make then I can’t rebut it.
I am so happy you mentioned North Dakota. I heard the NPR story a few weeks back and was blown away. Apparently we are living on top ofon more oil than is found in all the Middle East and north Africa combined, by a factor of 2X. Its truly mind-boggling. Something like 2 trillion barrels? I understand Canada has even more. At USA’s present consumption of 20MM barrels a day, this represents over 200 years supply of oil, all of it buried here. Canada has enough oil to power itself for the next 2,000 years. Like I said, its mind boggling. Peak oil can be put aside as a credible argument for at least another century.
Well, as a starting point, let me point out that you are lamenting the fate of Jed Clampet, a poor mountaineer who barely kept his family fed, yet up from ground came a bubbling crude. Oil that is. Texas tea. It turns out that collectively all the old Jed’s out there are sitting on about $185 trillion dollars of oil reserves. So pardon me if I don’t feel pity that Jed is forced into selling his coon-skin store and Ma Clampet no longer keeps the sewing store. They are filthy stinking rich. Its off to Beverly Hills now. No assessment board will set the value of their land, all the people clamoring for their oil will. In case I’ve not been clear, I think its completely appropriate and reasonable that society’s desire to get at 2 trillion barrels of oil trump the quaint wishes of Jed to continue hunting coons and Ma to continue sewing dresses. Jed is now going to be producing luxury furs with offices in Paris and Hong Kong and Ma is partnering with Ralph Lauren.
Wow. I think I'm feeling empathetic pain just contemplating the possibility that someone would do that.
Oh yes, I understand that, definitely. That was the critical argument you were referring to, right? Yeah, obviously, just as just because the "floor" is zero without land tax, yet nothing is stopping the man from earning way more than zero, the sky is the limit with a land tax, too.
This is sounding suspiciously Austrian...
Ha! Yes, because if nothing else, even if the guy's a bum, he is still delaying consumption by investing his resources in land rather than nights on the town, thus lowering the average time preference of society and enabling the structure of production to either get stretched out or shrink less quickly. And yes, assuming an evenly rotating economy (no North Dakotas, nor people changing their mind about how big of yards they like, no change in where or how they want to live and moving to or fro for any reason) all land will get that average rate of return we call the interest rate, because investors (if there's no uncertainty I guess we can't call them entrepreneurs) will gravitate towards putting money into land if it's earning a higher rate of return than the average, and thus bidding that rate until it reaches the average, or towards pulling money out if it's earning below-average returns, thus leaving the remaining land investors with less competition, enabling them to charge higher prices and earn a greater rate of return, until it goes up to the average. Boy, that was a long sentence. Anyway, you already understand all that, so I guess I just put it out there for anyone reading to partially explain what in the world we're talking about the interest rate for, though after 60 pages of the quality of conversation we've mostly had here, I kind of doubt anyone's still torturing themselves by reading.
Maybe. I understand the more-efficient-utilization argument, but I don't see why that should necessarily mean more-densely-packed-cities. Add a tax and people will stop preferring having a backyard to living in a high-rise apartment? Please feel free to explain. I tend to think that an even bigger factor in sprawl is that the government, always picking winners and losers, took the side of sprawl for 50 years and still does to an extent, using it's resources to make it happen through subsidies, zoning, building lots of beltline higways and roads in general, utilities, etc. which no one has to pay for (and so everyone has to pay for), etc., etc. Ending all that would make a bigger difference in how people distribute themselves than raising land taxes.
I actually really like Houston. Everything is so remarkably new and shiny and modern, in contrast to, say, Chicago. Traffic isn't bad either (relatively speaking). San Francisco was a lot of fun -- to visit; I'm sure I wouldn't like all their laws and taxes if I lived there. Especially Chinatown. Lots of amazingly cheap bizarre vegetables and unrefrigerated raw fish in buckets everywhere. In your face, food safety inspectors!
Yeah that makes sense. I think all these produce farmers should get their own freeze-drying machines and distribute things that way. That way you can pick the stuff when it's actually ripe, you don't have to use breeds with superior transportability but inferior taste, there's no time crunch to get it to your customers, you thus don't so badly need the economies of scale you're talking about, and the nutrition is locked in and the cell structure is preserved, even better than the fresh in some cases, which can suffer oxygen damage.
I think that land is a legitimate subject of ownership, so it is unavoidable for me to believe taxing it would be theft. Just so, you would believe that taxing me for using a computer would be theft, I think.
I have lower standard of theft than that: involuntary taking is theft, compensated or not. One man's "need" doesn't cancel another man's right. I don't agree with so-called eminent domain. Do you?
True. It wouldn't be the worst thing in the world. But neither would it be the worst thing if you had this same set-up for capital goods. You charge a CVT (capital value tax) on capital goods, determined based on assessors, market prices, and some sophisticated computer model Roy L. has. Just like LVT. The owners of injection molds and CNC lathes would then pay an annual tax. Normally, as long as they were putting them to reasonably good use they'd be able to afford the tax. If the tax is high and the factory can't afford the tax, there is some reason. We can assume there are many buyers waiting in line to pay the higher price of the machines. Perhaps society needs every available unit of a specialized machine the factory has, in order to produce the new iPhone which is in a desperate shortage. The owner is lucky to be in such a position! With the money, he can buy even better machines and twice as many, and manufacture to his heart's delight.
Amen. Score another point for Julian Simon. Human ingenuity truly is The Ultimate Resource. We will never run out of any natural resource, as long as we have freedom.
In the absence of an LVT, in fact, even such stores would be prospering, because the old clientele is still there, and with a much higher population (with lots of excess spending money) some small percentage of the oil workers may have wives needing sewing needles, and some larger percentage will definitely decide they need a coon-skin cap. So business will increase. It's only if the taxes increase even more than the profits do that it must be the end of the road for them.
Thank you for your vote of confidence!
