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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 concern with LVT is that I regard most kinds of property tax (as well as income tax) as fundamentally immoral, for basically Nozickean reasons, and I do not regard that as "low-effort" in the slightest. I am fine with sales tax, insofar as government facilitates exchange through the medium of regulated money; when you use the government-facilitated exchange, you should also pay for the maintenance of that exchange. I am okay with property tax to the extent that the use and enjoyment of your property depends on government police powers protecting borders and private property rights, but even here I favor strong homestead protections; for property you live on, especially, I regard tax foreclosures as strictly immoral. In the U.S. today, almost all tax dollars fund purely redistributionist aims, and I do not think there are very many plausible justifications for the amount of redistribution we do (though there are probably some cases where it's justified, particularly where negative externalities are imposed on the public by private actions).
I get the impression that some of the basic ideas of Georgism/LVT may be compatible with my view, but presumably someone who paid the value of land, and never improves it, can only sell for the (present) value of the land. Any "profit" they make is down to fluctuations in the market that are beyond their control. One of the most basic rules of business associations law is that whoever bears the risk, reaps the reward. The way you've described LVT here ("tax away the value of the land"), privatizes risk of holding unimproved land, while publicizing rewards. That seems to me just as objectionable as publicizing risk while privatizing rewards.
But I have not made a careful analysis of Georgism (beyond reading what Scott says about it) so I'd be interested in any corrections you might be able to offer my view.
Why are sales taxes better than income taxes under your philosophy? They both make use of the medium of regulated money.
The problem is most legible for the self-employed. For them, income tax is just an additional way of taxing profits after they've already been taxed as transactions. So like--you open up a shop, you charge $100 in labor to fix someone's iPhone. Depending on where you live, you also have to collect 6% or 10% or 12% in sales taxes on that money, to pay to the government. But hey, you've got $100! Well, no, now you also have to pay over 15% in self-employment taxes, and another 5% or 15% or 35% or whatever in income taxes to the government because... why? You already paid tax on the transaction, if it's not enough to support the system of exchange, then raise taxes on the exchange!
It's a little less clear for those who collect salaries or wages, but consider that in the U.S. your paycheck does get taxed directly, as an exchange, before income tax withholding kicks in--Social Security and Medicare amount to a 15.3% tax if you're self-employed, though most people have about half that amount paid by their employer rather than having it come out of their paycheck. That looks much more like a tax on the exchange of services for money than a tax on income per se (though it would be better, I think, if it were a flat fee rather than a percentage).
You might say "well, it's six of one, half dozen of the other" but even if that's numerically true, the math can function as a shell game for government actors. How often have you heard something like, "I don't mind paying taxes because I like to drive on roads!" A large chunk of most state transportation budgets, however, is fuel taxes--which makes sense. If you don't use the roads, you don't pay for (that part of) them. When there's a clear connection between the tax being levied, who it's being levied on, and how it's being spent, that benefits citizens by keeping systems accountable. That kind of transparency can, I think, help prevent cost disease. If your paycheck is getting charged, essentially, sales tax for the transaction between you and your employer, with the explicit purpose of keeping the nation's monetary system functioning, people will think of it very differently than if they're essentially pouring money into a general slush fund for Congress to spend on god-knows-what.
And really, in a system of fiat currency, it's kind of silly to have taxes at all. This is a more complicated argument, but basically the point of taxes used to be that the government needed your money to pay soldiers and pave roads. Under a fiat currency system, the (federal) government doesn't need your money; your money is worthless to a government that can make as much money as it wants. Really taxes aren't even a question of revenue, taxes are just one of many interlocking opaque and unaccountable systems the government and its cronies can use to regulate the economy, or in other words, to control people. For their own good, maybe! But that's the kind of thing I would prefer the government be forced to do explicitly, if it's going to be allowed to do it at all.
So basically, sales taxes are better because they are a step toward government transparency and accountability. It's okay to tax your paycheck as an exchange. But calling it an "income tax" so you can effectively double- or triple-tax certain exchanges (by multiplying the number of "exchanges" ostensibly taking place) is exactly the sort of thing I regard as morally impermissible government behavior.
Which may not really matter much in terms of the effective impact of the tax. If it costs more to employ you that puts downward pressure on you wage or salary. If a change was made now to put it all on the employee, its not like all employee compensation would automatically or even quickly change but in the longer run the amount going to employees might not change much.
Fuel taxes are also used to cover non-road transportation, so it may be the case that that large chunk is actually in a sense over 100 percent. (Yes the actual road expenses only cost 100 percent of what they costs but the fuel tax could be more than 100 percent of that cost.)
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Not sure where to begin with this really. Governments can't spend in any great capacity without taxation, whether or not you want to call it a 'question of revenue' or not. The government can't borrow without the presence of taxation guaranteeing to debt holders that the government will eventually fulfil its obligations. Nor can it simply 'print money', the consequences of financing expenditure with only creating new money would be absurdly inflationary.
This is how people perceive taxes like fuel duty but they are totally wrong. All taxes pay for all expenditure. We know this is true because firstly rates of fuel duty move up and down completely out of sync with costs of road maintenance and construction, and secondly because what you pay for fuel duty doesn't correspond with the wear and tear you cause on roads. If two cars of the same weight have different levels of efficiency, then the more efficient car pays less despite not doing any more damage to roads. On a policymaking level, fuel duty is set with no reference to the cost of roads, it's just one source of revenue for the government (with added environmental concerns).
I would recommend you begin by thinking more carefully before making sweeping declarations about what governments "can't" do. The second part of this paragraph demonstrates why you're clearly wrong about the first. Governments can, and do, "simply 'print money'" all the time. And yes--when they do that, it's inflationary! We know it's inflationary because we've watched it happen time and again throughout history. It's weird to say "governments can't do X, because it causes Y" when the suppressed premise is "and we know it causes Y because governments somewhat routinely do X." What you really mean is that governments shouldn't do X, for further reasons to be explained.
A claim I encountered some time ago, that I've been contemplating for a while, is that taxes are now the primary backstop of the dollar's value. You can find other ways to exchange goods and services, you can barter or use other currencies or whatever, but the only way to pay government taxes is with government-approved currency. So at some level you want your transactions to be taxed, because that is both how the currency you have maintains its value, and how you can secure receipts declaring that the government's monopoly on force should not be used to confiscate your property.
The more I think about this, the more I feel like the switch to fiat currency is something we as a civilization have yet to sufficiently digest. Part of me continues to suspect that fiat currency was just a horrible mistake. I'm aware of the reasons why it was done, and the arguments for how it greased the skids for American prosperity. But that's the kind of trick you can only pull once; when you do it, a bunch of stuff comes apart and the sociological distortions created by those trends are hard to predict beyond "probably not great."
But part of me wonders if we just failed to sufficiently commit. A major practical development that ended the Confederated U.S. and gave rise to the Constitutional U.S. was a bunch of unpaid soldiers. Would the question of soldier pay have arisen under a system of fiat currency? I think no--the U.S. cannot run out of dollars. Those dollars might be worthless, but that's a different problem! When the U.S. government "borrows" money, it's actually a bit of a farce; in a fiat system, the U.S. cannot possibly default on any of its dollar-denominated debt unless it chooses to do so (by refusing to print the necessary dollars). "National debt" is just a way of printing tomorrow's fiat dollars, today! And inflation is a tax on people who have money (both now, and later). The question is, if the government collected no taxes, and instead printed money to finance expenditures, would the resulting inflation be a greater tax than extant taxes, or a lesser tax?
That's an empirical question that will presumably depend in great measure on psychological factors (namely, how people perceive inflation versus taxation). It is not an empirical question I think will ever be answered. But this is why I think about the "taxes give your dollars value" argument a lot. If it's right, then one inescapable "cost" of maintaining a functioning system of economic exchange just is confiscating some amount of people's money from time to time--because if you don't, then people will get rid of money as fast as they can, exchanging it for durable goods and other stores of value. And not poor people's money, because they won't think about or understand any of this, but rich people's money, because they are the ones who are most afraid of having their goods confiscated by state-sponsored bandits and extortionists ("revenue services"). To successfully pay the protection racket, they must agree to participate in the sovereign's monetary scheme. But this functionally disincentivizes certain kinds of success, and it makes the task of transforming income into wealth more difficult, essentially protecting the existing rich from competition that might otherwise rise from the lower classes.
This is why the apparent death of small-government conservatism (which was never very healthy to begin with) is so frustrating to me. The appropriate way out of this mess, as I see it, is to keep the government small enough to drown in a bathtub. Imagine a government that collects sales tax alone, and primarily finances expenditures through inflationary money-printing. In such a government, the way to keep inflation low is simple and obvious: keep expenditures down. Every decision to use the government monopoly on force would be accompanied by a tax on everyone with money, in the form of inflation. That's about as direct as accountability gets. And yes--I can imagine that this could be hell on the economy in a variety of ways. But my argument is a moral one. I want to increase liberty, and decrease the use (or threat) of government coercion against citizens doing nothing but living their lives. If stealing was the only road to general prosperity, it would be better for people to make peace with being paupers.
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