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The recent Georgist uprising in the rat-sphere seems to be spreading outward, and gathering steam if anything. Lars Doucet, who wrote the original ACX post that blew up, is now releasing a book called Land is a Big Deal which summarizes his writings thus far.
There was also a major takedown of Detroit land assessment practices by a major land parcel data collector, ReGrid that dropped a few days ago. Major takeaways:
In addition, some fairly mainstream political candidates such as Chloe Brown who's running for Mayor of Toronto, seem to be gaining steam. Land value tax is a large plank in her platform.
I got interested in land reform through the original series of ACX posts, and frankly I'm surprised how interesting the problem is and how overall neglected the topic seems to be. Even extremely intelligent and well read folks I talk to about it are surprised when they learn that land value is usually just pulled out of thin air - the industry standard is to just take 25% of the purchase price and not give a shit about location or any other factors, which seems bizarre upon a critical review.
I've seen some discussion about Georgism/LVT here, but curious if anyone else has been following this?
Also, what are the arguments against LVT, besides low-effort "taxes are always bad and raising them is evil?" Genuinely curious for well thought out reasons why an LVT would be a bad idea.
Edit: For those new to this idea, a Land Value Tax in it's most basic form simply says we should tax away the value of the land, and only let people who sell land profit off of the 'improvements' they make, such as buildings, restorations, etc. For instance if you bought a piece of land and tried to sell it 1 year later off pure speculation, doing nothing to the land, you would not receive any profit.
My understanding is that this is effectively an opportunity cost tax. I.e., if you are sitting on a valuable plat which could generate 10 M$ in rents with 1 M$ of improvements, the market value of the plat should be about 9M$, and you would be taxed on that value, even if you were only generating 100K$ of rents (including imputed rents).
This is economically very efficient, as it encourages land to be used for its most economically efficient purpose. However, this butts directly up against peoples' real-world desires to "settle" - to establish a home in a place and be able to stay there indefinitely. If, for reasons beyond their control, the price of their property increases, they can be financially forced from their homes, which is about as soulcrushing as being foreclosed upon, while also seeming much more unfair. It destroys a person's ability to make stable long-term plans regarding a very fundamental fact of life. It also destroys residential community, by creating a disincentive to make a community that people want to live in, which has the natural effect of increasing property value. These are already problems with existing property taxes, that would be greatly amplified by taxing away all of the land value (leaving only rents).
After all, most people recoil about applying the same logic in other contexts: should a person's income tax be based on the amount of money they theoretically could be earning, if they worked as much as possible in the most valuable field they are qualified for, in the location with the highest salary? Hard-core utilitarians have seriously proposed this, but the concept of being treated as an economic ends with no function other than to produce social benefit, rather than a sapient being with noneconomic needs and desires makes most people reject this with prejudice.
The solution I've seen mentioned is that you can permit the homeowner to 'name their price' i.e. the value of what they think their home/land is truly worth, with the caveat being that if someone offers to purchase at said price they are legally compelled to accept it.
If they name an astronomically high price, then they are going to be taxed accordingly.
So the incentive would be that they name a price that is sufficiently high to make up for the the distress of leaving a cherished home, of finding and moving to a new one, and whatever other burdens would be placed on them if they were to move, but not so high that they couldn't afford the tax burden.
I've not thought of nor seen a solid rebuttal to this proposal. If a homeowner has a price they are genuinely willing to accept for a property they have an extreme emotional attachment to, then 'forcing' them to sell at that price is barely a harm. If they claim that the property is actually worth far more than any buyer would reasonably be willing to pay, then they are prevented from complaining if their inflated valuation is the one they pay tax on.
Because if we take the complete inverse of your scenario, we end up with nail houses where a person refuses all reasonable offers to sell, and ends up having all the positive features of their neighborhood stripped away and end up distressed anyway, but with no money to show for it.
The simplest rebuttal is that it is immoral to tax people for having natural human feelings of attachment to their home. You could make the same case for forcing people to set a sale price for their children. Very efficient for clearing the adoption market. Or for their spare organs, even. By forcing people to pay for the right to not be forced from their home, you are turning a voluntary market into an involuntary one, which degrades the market and degrades basic human rights and dignity.
That said, I'm not totally against the use of eminent domain powers where you have obstinate sellers blocking genuine civic improvements. But I think the "public benefit" of such seizures needs to be adequately established.
If we grant that people's feelings have moral weight then we're opening up quite the can of worms here.
If people aren't willing to place a specific price tag on their 'feelings of attachment' then how can we know that their attachment outweighs that of the buyer's desire to have the house?
What if the buyer is actually attempting to re-purchase their childhood home, and has INTENSE positive feelings associated with it?
How ELSE can you figure out how to weigh the disparate interests here?
I don't see how. We account for them in myriad other laws.
Because otherwise they would sell at that higher price voluntarily, presumably.
Voluntary transactions, the same way we clear most markets. This is only a problem because you're starting with the assumption that the owner shouldn't be able to benefit from the transaction.
Yes, that's the trick. You ask a person "at what price would you voluntarily part with this piece of property?"
and if they offer such a price, they should by definition be willing to accept an offer at that price without a fuss.
They're free to name an arbitrarily high amount, but then they'll be held to that number by being taxed on it.
If you are objecting to the morality of taxing assets at all you can find this problematic Otherwise, there's really no fairer way to establish a valuation for purposes of imposing a tax.
Well then it's not strictly voluntary, is it? If you can't afford to pay the taxes on your subjective valuation, you're forced out of your home just as surely as if the government re-assessed your property at a higher rate than you can afford.
This is why we don't normally tax wealth.
In the same way any tax isn't strictly voluntary, yes.
But this argument generalizes to literally any sort of tax you could impose. I'm happy to have that discussion.
But I thought we were engaging with the LVT idea itself.
Which is why you better set your valuation at the correct level!
Is it better to depend on the government to declare a valuation which you have almost no control over?
Also because wealth can be easily hidden or obfuscated. As opposed to land, which is physically located exactly where you expect it to be at all times, and can't be hidden.
But surely taxing land doesn't prevent someone from shifting their wealth into other, non-taxed assets!!!!
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No. You come to me with an offer and earnest money, and I decide if it is worth my time to bother listening to you based largely on the number.
It is aggravating to price everything in my life, knowing that I am fucked if I get it wrong because they are out to get me.
If someone values my home at $3 million because of the feng shui, they can offer me $2 million and keep $1 million of surplus for themselves. $2 million is more than I value my current home. Now someone is going to try "we already know you are a whore we are just negotiating on the price" to figure out exactly where below $2 million my value is and that is when I tell them to eat shit. If I have to defend my property constantly then I might as well go full ancap and blast anyone who steps on it.
I mean this happens, constantly, all the time. If you live in a desirable area you will get a veritable stream of calls, texts, e-mails trying to make you an offer on your land.
It's dreadfully annoying to filter.
From my perspective, I'd much rather just publicly set the asking price for which its worth my time to even engage with a possible buyer, and only interact with those who can prove the ability to pay the asking price, and everyone else can pound sand.
And if you think there's someone out there who values your house at $3 mil, maybe set the price at $3 mil, or $2.5 to split the difference.
Nothing in this hypothetical situation demands you set the price exactly where you value it. You're free to set a 'strategic' asking price too.
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