Absolute classic. Another Tolstoy short story I really love is the tale of "The Two Pilgrims". You read them once. And they stay with you your entire life ;)
Gosh... I (re)read it this morning, and come across it to here. I developed an habit that I gift a book to a random person I meet on outside... at a coffee shop, or on a beach whatever. I usually choose a person that read a book and go like "hey, what are you reading?" and we talk about it... It's a great icebreaker. By the time, I happen to buy hundreds of books and decided to share them. What is the point collecting them and calling it a "library"? It eventually lead me to meet the people from all shades of life with the interesting stories.
Interesting practice. I like to read, around 2 books per month, and mostly random books (non fiction) that catch my interest. I have interests that are unrelated to one another, and due to this I find it difficult to just talk about a book to someone I know, and even more so with strangers.
I'm the same way, but I've actually found that having random interests makes it easier to talk to people, precisely because I've read from a variety of topics.
What does your schedule looks like? I have a large catalog of books which Id love to go over, but it can be very hard for me to find the time to simply sit and read beyond sitting on a plane or a bus
Do you not have much free time after work? Or do you just feel like there are better things to occupy it, other than reading?
I always read after a work and manage more than 2 books a month but, then again, I don't think I've seen a movie or played a video game in at least half a year, so I'm sacrificing on that front.
Yeah, I'm lucky to have no kids and a bookworm partner so I don't get roped into playing with toys or watching reality TV. The other option in such cases would probably be their commute to work, if they have one. Audiobooks can be a real savior there.
I read on the subway everyday. My commute time is 1 hr to work and 1 hr to home so 2 hrs everyday. Most of the time it is enough to read 2 books per month. I don’t do speed reading.
The basic point of Georgism is that landownership is the root of most of the economic evil in the world and land should all be expropriated and held in common. (but don't want to expropriate capital or do anything to it, unlike the Marxists: Marx called Georgism "Capitalism's last ditch")
So strangely enough, it's not about greed in general, it's about land specifically.
Basically, the social value of land is 100% socially constructed, but under a system of landownership, it's 100% privately held and all the profit goes to private hands. There are multiple empty lots very close to downtown SF which are worth millions, tens of millions that the landlord didn't do jack shit to improve, that everyone else improved the value of, that the entire value of is the location. But when the landlord sells, only they get the value.
But it's easy as hell to tax land and impossible to avoid the tax (just show up with cops, what the hell are they going to do, move the land? - and if they don't pay, just sell the land to someone else, although usually the aim is to collect the tax when transactions happen) So tax it. 100%. Georgism's tax suggestions go: have that 100% land tax (not property tax), have no other taxes, that's it. Also tax networks which have an inherent monopoly effect, it was also suggested by Henry George.
Nothing to do with agrarian points of view, really. Georgism was created in SF, it was most popular in NYC, and it was talking about the problems of the first properly modern cities in America and Britain.
Do you suppose the owner of the land wants to build on it, but is being blocked by socialists in the government? Do you think this developer bought some lots in SF and left them empty just to make tech bros upset?
When you don't or can’t own land you end up with favela-like developments. It’s okay as a sort of transition from homelessness to home ownership but you don’t want that to be the end stage for a city.
Land value tax isn't property tax. Despite my use of the word "expropriation", what George specifically suggested was that people would be able to own land, they just wouldn't benefit any from improvements in land value because of the land value tax. So you would have to improve property and do something with it to benefit from it.
You get that in absence of building codes. Right now in many major cities people don't or can't own land, can't build rigid favelas due to building codes, and instead end up living in tent favelas on the sidewalk or sleep in their car. That's not a great end stage for a city, either, but that's the status quo in our investment driven real estate market.
“But it's easy as hell to tax land and impossible to avoid the tax (just show up with cops, what the hell are they going to do, move the land?“
The revenue man wanted granddaddy bad, headed up the holler with everything he had, ‘fore my time but I’ve been told, he never came back from Copperhead Road...
If you shoot all the cops (and probably the army), then you have conquered the land, congratulations. You are now the state. Probably have to go and make your own cops now.
>Basically, the social value of land is 100% socially constructed, but under a system of landownership, it's 100% privately held and all the profit goes to private hands.
But this can be said for anything, no? After all the value of every asset is socially constructed, whether that's shares in a company or land seems irrelevant, so if you buy that logic I feel like the Marxist case makes more sense instead of just arbitrarily stopping at land.
It also seems counterintuitive because it would essentially mean that someone who holds billions in shares or digital assets has no tax burden under the Georgist logic but a small independent farmer does.
You own the value of the goods you've made with your own hands (minus the value of their raw materials if you want to be strict about it), and by extension you can freely trade those. Land is the exception because people don't make it themselves, they lay claim to what's already there (even in the case of "artificial" land, most of the value is in the seabed that was there before rather than what you did).
> It also seems counterintuitive because it would essentially mean that someone who holds billions in shares or digital assets has no tax burden under the Georgist logic but a small independent farmer does.
Someone living like a billionaire probably owns a much higher value of land (if only what's under their mansion) than a small independent farmer. The land value tax would end up being built into food prices, so farmers wouldn't lose out on the whole unless they're currently growing wastefully; maybe farming would be pushed onto less valuable land, that's sort of the point (but in practice that mostly happens already; farmers near towns wanting to expand would get gradually pushed out via higher taxes rather than getting a windfall for selling up, which is bad for those individual farmers but better for society as a whole).
> Land is the exception because people don't make it themselves ...
People don't make the land but they do make the value of the land. Even if that just consists of recognizing the potential in what is already there. LVT does nothing to distinguish between value resulting from the actions of the owner—apart from a very limited set of formally recognized "improvements", mainly permanent structures—and value resulting from the actions of others. And even if part of the "unimproved" value does result from others' actions, these others are not, in general, the ones receiving the tax.
> LVT does nothing to distinguish between value resulting from the actions of the owner—apart from a very limited set of formally recognized "improvements", mainly permanent structures—and value resulting from the actions of others. And even if part of the "unimproved" value does result from others' actions, these others are not, in general, the ones receiving the tax.
The same is true of the existing system - currently owners pocket all of the value increase despite the vast majority of it being nothing to do with them. LVT is a recognition that most of the value of land comes from the actions of others - not just a handful of immediate neighbours but the whole surrounding community (e.g. most of the value of land in a given city gets its value from the entirety of that city) - and so should rightfully go to an organisation that represents that community as a whole.
> currently owners pocket all of the value increase
Except for the property taxes and local sales taxes which pay for all these things supposedly contributing "unearned" value to the land... and which over time add up to more than the increase in land value.
> despite the vast majority of it being nothing to do with them
> to an organisation that represents that community as a whole
[citation needed x 2]
LVT eliminates the financial incentive to take personal or collective private action to improve the community as a whole. Rather than increasing the value of your property (and your neighbours') your only reward is to be saddled with additional taxes above and beyond the cost of the improvements. The LVT model essentially assumes that the only source of community-level improvements worthy of remuneration is the government. Which is obviously nonsense. If I contribute to the community at my own expense, the benefits accrue not to me but to the government—which may represent "us" in a vague, manipulative sense but certainly doesn't represent me—to be spent more often than not on things I explicitly do not want and which are contrary to my own interests. Governments love to act as though they enjoy an agent/principal relationship with their constituents but neglect the fact that an agent has a individual duty to each principal, not just the majority position. It's an inherent conflict of interest to serve multiple principals with conflicting goals.
Of course, property taxes have a similar issue, but at least they don't have an explicit goal of negating all profit to the property owner; you don't get the full benefit of contributed improvements but you do get the majority of it.
> The LVT model essentially assumes that the only source of community-level improvements worthy of remuneration is the government. Which is obviously nonsense.
Any organisation that purported to represent the community well enough to make community-level improvements (which will almost inevitably make things worse for some people even if they're a huge gain for the community as a whole), like "we should demolish these buildings to put a rail line in" or "should this area be a park or a factory", would have to incorporate the same feedback mechanisms and so on that would make it a de facto government.
If you're doing something that really improves the community as a whole, under LVT the community government should be willing to fund it, since they'll get back all the value. Indeed they have an incentive to seek out ways to improve the community and encourage neighbourhoods to improve themselves, unlike today.
> Governments love to act as though they enjoy an agent/principal relationship with their constituents but neglect the fact that an agent has a individual duty to each principal, not just the majority position. It's an inherent conflict of interest to serve multiple principals with conflicting goals.
Of course it is. Doing anything on a community scale is inherently difficult, and there will inherently be winners and losers. LVT actually helps even that out though - the gains of community-scale improvements accrue to the government of the community as a whole, but by the same token they also bear the cost of any local deteriorations.
> Of course, property taxes have a similar issue, but at least they don't have an explicit goal of negating all profit to the property owner; you don't get the full benefit of contributed improvements but you do get the majority of it.
Property taxes are a completely backwards way to approach this kind of thing, because they punish the owner for the one kind of community improvement that they actually fully control and spend their own money on. Under LVT you keep the full value of your buildings, landscaping and so on (which are the result of your own toil); you pay taxes on the value of the unimproved land, which is a function of the community as a whole rather than your individual efforts.
Probably that with sufficient land you can sustain yourself regardless of what happens with the outside world. Sustenance farming as a baseline of human need.
>Probably that with sufficient land you can sustain yourself regardless of what happens with the outside world. Sustenance farming as a baseline of human need.
Producing enough in the growing season to sustain yourself through the off season is... no small amount of work. You need a reasonably large amount of capital in the form of tools and knowledge to have a reasonable shot at doing so with only your labor. And unless you have a lot of capital in the form of advanced machines, it would be a huge amount of labor.
But that's not the real problem; the real problem is how chancy farming is. Too much rain? no food this year. Not enough rain? no food this year. I mean, there are a lot of things technology can do (like, say, tile drainage and irrigation) that make the growing conditions wider, those things can require significant capital and/or labor, and even then, you can have too much or too little rain. Even if you do everything right, if you are depending on growing your own food, there's a reasonable chance of not getting significant calories for a year or two just 'cause the weather was bad.
Most of our farm subsidies go to crop insurance; the government essentially sees to it that our farmers are made whole if it rains too much or too little, which makes farming a lot more certain, and helps ensure our overproduction of food. (note, I totally support my tax dollars being used for this; If there's anything the world should overproduce, it's food.)
It seems to me that is a variation of the same idea. The only difference is that nomadic groups need access to much more land in order to generate the same number of calories that agriculture does.
Well, agriculturalists before the modern era were generally more malnourished than hunter-gatherers. Mostly due to a lack of various nutrients and heightened risk of famine due to low food diversity- one drought or blight can wipe out your whole monocrop, leaving no backups or alternatives. Hunter gatherers sampled a much broader swath of the ecosystem, so one food source crashing for a year or so had a much smaller effect.
Good question, and why not just look at the Wikipedia entry, which addresses this in the second paragraph:
>paradigm seeks solutions to social and ecological problems, based on principles of land rights and public finance which attempt to integrate economic efficiency with social justice.[6][7]
>Georgism is concerned with the distribution of economic rent caused by natural monopolies, pollution, and the control of commons, including title of ownership for natural resources and other contrived privileges (e.g., intellectual property). Any natural resource which is inherently limited in supply can generate economic rent, but the classical and most significant example of 'land monopoly' involves the extraction of common ground rent from valuable urban locations. Georgists argue that taxing economic rent is efficient, fair, and equitable. The main Georgist policy recommendation is a tax assessed on land value
Cynically, the difference is that they don’t own much and other people do. If you’re a 19th century new-money factory owner [] looking enviously at all those old-money landed aristocrats it’s easy to see why you’d be able to persuade yourself that actually it’s assets you don’t* own rather than assets you do that should be taxed.
(Or a ruined old-money aristocrat turned novelist. Or a 21st century San Francisco tech bro who has just realised that he’ll never be able to afford a house.)
Georgism had far too much popularity in its day to be a specialty economic point of view, although it is nowadays. Two years after its publication, _Progress and Poverty_ was the second most bought book in the US, after the Bible.
Land is not an unlimited resource and therefore a public good. This is the same principle the FCC applies to the airwaves (obligated to say here - fuck Ajit Pai).
One obviously should be able to LEASE the land from the people if they intend to do something useful with it, but otherwise, you are just going to have the land accumulate in the hands of ultra-wealthy who just sit on it. It will appreciate in value since there will be fewer and fewer patches to buy, and then you have a bunch of kids from Succession acting like they own the world, since they happened to inherit it by purely winning the birth lottery.
Alternately: Since natural resources are not created by people, there's no reason why a given person should have the right to profit from it to the exclusion of others. They didn't do anything to create the resource, it was there already.
> there's no reason why a given person should have the right to profit from it to the exclusion of others.
The social value of private ownership isn't in permitting owners to profit, it's in aligning incentives so that a resource is put to the most productive use. Very often those willing to pay the most money are the ones with the most productive use, and so long as there's a private owner his interests are usually to sell to the highest bidder. More importantly, a private owner can't be corrupted into selling to lower bidders, whereas bureaucratic owners (public or private) can be.[1]
I [very briefly] researched Georgist taxation systems in the U.S. when taking a seminar on land use regulation. My tentative conclusion was that they weren't very effective because the bureaucratic systems for appraisal were very quickly corrupted--not to benefit individual politicians, but to satisfy the electorate, who often find such taxation schemes unfair.
[1] A private owner with multiple interests might be willing to sell one interest to a lower bidder in exchange for a higher bid for some other interest, though.
How do you determine what the most productive use is and whether a natural resource is being put to it? If one person owns so much useful land that they don't even have to work and another person works hard but does not own any useful land then I don't think that's a productive use of the land.
I agree with you that Georgism isn't perfect. However, I haven't seen a better solution.
> How do you determine what the most productive use is and whether a natural resource is being put to it?
You can't. No one person can. That's why centralized economic planning doesn't work. (I'm not trying to suggest that Georgism is centralized planning, or that Georgism doesn't appreciate the value and necessity of price signaling.) And private ownership doesn't necessarily lead to the most efficient allocation. But the point is that private ownership is a stable regime. There are an infinite number of regimes that would offer better allocation, but we haven't yet seemed to find one that is stable, or that we can make stable. (A big part of the problem, I suspect, is cultural, so I don't mean to suggest that Georgist systems are inherently unworkable, just evidently unworkable in recent American history. I think our social and political cultures play a big part in what make land value taxation seem unfair.)
That said, if the public believes land isn't being put to good use it can purchase the land at market price.[1] That still leaves accidental and speculation profits in private hands, but theoretically it puts a ceiling on inefficient allocation. Unfortunately, in some ways (particularly politically) eminent domain powers are at their nader in the U.S. Which is a big part of the reason why we can't accomplish things like California Highspeed Rail. I think that drives home the point that Georgist taxation is less workable today than it ever has been in recent history.
[1] That's required by law in some countries, like the U.S. In some other countries it's not technically required by law but it's often the case that the government does pay market price, simply because to do otherwise would seem unfair and lead to political backlash.
That's fair. I suppose partially I'm coming from the perspective of: why should I care if a system is stable if it benefits the rich at my expense. As I see it the idea of liberal democracy is to create a system that works for everyone so that everyone is incentivized to make it stable. As long as that's not the case, then it seems reasonable to be willing to trade some stability for more equality.
>Unfortunately, in some ways (particularly politically) eminent domain powers are at their nader in the U.S. Which is a big part of the reason why we can't accomplish things like California Highspeed Rail. I think that drives home the point that Georgist taxation is less workable today than it ever has been in recent history.
HSR would be easier with a land value tax - there would be a negative incentive to hoard land, so land acquisition costs would be minimised.
Yes, I know.[1] My point is that the current political environment is especially averse to systems which trade private gain for public good. Central Valley farmers have been successful in running out the clock and extracting huge payouts for their land because they can leverage public sentiment to forestall land acquisitions that are both perfectly legal and rather run-of-the-mill. In most holdout cases California courts would order a sale rather quickly, but the state doesn't avail themselves of that option nearly as much as they could. This is how Georgist systems seem to become corrupted--an appraisal results in some sympathetic character (an elderly person or even a businessman) effectively being forced to move or sell, exceptions made, formulas tweaked, inexorably regressing the Georgist system to the status quo ante.
California is a great example: HSR battles and Prop 13 revenue dilemmas are things that land value taxes are directly intended to resolve in favor of the public wealth. But both of these phenomena have strong public support propping them up, directly and indirectly. Prop 13 was passed precisely because the public was concerned about the threat of people being priced out of their homes, and that sentiment is at least as strong today as it was back then. Land value taxes would systematize homeowners' worst fears, and they won't be placated by arguments or even evidence that shows that they're better off on average.
I'm tempted to say that people are just irrational or that the public often wants contradictory things, but that would be lazy--true but lazy. In any event, my point is that resolving these things requires more than simply engineering a system that works better on paper. Incentives have to be aligned not just in dollars, but also in votes; not just at the outset, but also on an ongoing basis. Georgist land value taxation schemes are fundamentally predicated on consistent, long-term application. Once exceptions are made it crumbles because not only do perceptions of unfairness increase, the utility of the regime declines. This is true of alot of things, even traditional land taxation, but it's especially true of land value taxes.
[1] Or at least I'll concede that point. It's not obvious to me if and how prospective public works projects would figure into land values under a Georgist system, especially in the rural areas where HSR battles seem to be the worst. (AFAIK, the more urban areas in and around Fresno were acquired and bulldozed rather quickly.) Particularly with land value taxation, the devil is in the details.
No, what I'm suggesting is that the making of a resource is where someone adds value.
So profit that comes solely from owning a natural resource isn't earned; however, profit that comes from the labor of extracting the resource or from making something with the resource is.
"Making something with the resource" must include having the foresight to preserve it from others who would have consumed it for a less valuable use. The "unimproved value" is what it would have been worth if left unclaimed—not the market value of the land in the actual situation where it was claimed and preserved. The difference between those two prices is earned value even if it doesn't take the form of formal "improvements" built on the land.
However, under that definition there essentially is no such thing as "unimproved value"—unclaimed and unpreserved land would quickly become unusable for any purpose—and the proper LVT assessment in the vast majority of cases would be zero, or else so low as to not be worth collecting.
If you over-farm a piece of land, it loses fertility, until it becomes un-arable.
If LVT is implemented, then there would be incentive to over-extract from the land anything that is valuable and can be avoided from taxation (such as fertility, or minerals, or anything else that rises from the land).
I dont think this can be sustainable - because without clear, exclusive ownership that lasts indefinitely, why would anyone value the land at all?
> I dont think this can be sustainable - because without clear, exclusive ownership that lasts indefinitely, why would anyone value the land at all?
For the same reason that people already rent property they don't own. There are all sorts of value-generating activities that require exclusive right to some land.
Based on my reading of Progress & Poverty, it’s not so much the finite nature of land that matters (though it does make the concern much more pressing). The reason land ought to be taxed differently is because the people who monopolize its productive power did not create the land nor its productive power.
The central thesis of Henry George is that a person is entitled to all value s/he creates. No one creates the value of natural resources like land (but also ocean, radio spectrum, etc.), but landlords get to monopolize its value. Since they have no claim to what they did not create, it would be economically just to tax that value and distribute it.
One argument would be that if someone doesn't have the opportunity to provide for themselves through farming then they have no choice but to work for someone else. That then means that their labor is no longer freely exchanged which is supposed to be the core of Capitalism.
However, my understanding is that Georgism generally applies its arguments to natural resources in general; it's just that land has traditionally been the most important natural resource. You could also probably extend its arguments to other forms of economic rent.
In Georgist terms 'land' means any non-renewable natural opportunity such as thr actual land, magnetic spectrum (wifi, 5g)… deposit of oil or iron ore or even ancient sites built by previous civilizations that nobody can claim inheritance to nowadays.
Labor is in theory infinitely expandable. Capital is infinitely expandable. Land (and natural opportunities) is fixed in supply, so according to Georgists there is no moral argument for favoring somebody for its monopolization. It should be community owned and rights of use to it should be given out to people, priced by a market mechanism.
Labor and capital don't suffer from fixed supply or renewability so according to Georgists there is no need to prevent it from expanding, eg. by slapping taxes on it.
Georgist movement is also known as single-tax or zero-tax movement, because they advocate that there should be no taxes on labor, consumption or capital. The only tax implemented should be the natural monopoly tax (land value tax). They say it would be enough to finace government from it because there are crazy trillions of dollars parked in real estate. Real estate price is actually land value price (location, location, lovation), so only land tax would suffice and there is no need for property taxation, which is actually product of someone's labor.
Some Georgists say that Land Value Tax is not even a tax but a payment for exclusive rights of use. You pay for the service the government gives you directly, therefore it's not a tax. In this way they argue you can run a society with exactly ZERO taxes and paradoxically raise even more money than current tax system.
There are grades of land. Land in the city is more scarce and more valuable. Rural land is less scarce and less valuble. Land on Mars is even less scarce and less
accessible and less valuablee.
Same with domain names. People are interested in using shorter domains like abc.com, not long ones such as xyajfbeusnfdbdjak.craptld
The scarcity applies to a grade of land or string, not to all land in the Universe or string space in total.
It is difficult to compare the 'grades' of land, because the grading is not discrete but somewhat continuous.
With the production of some additional capital, it should be entirely possible to go get all of the rest of the land and other natural resources in the solar system/galaxy/universe
A nation is the relevant unit here. A nation cannot always practically render useful all land within its own borders.
The hypothetical expansion of the human race in the coming centuries has no bearing on decisions that are made with the next years and decades in mind.
Even if land on Earth were infinite, there would still be differences in value based on location. Already there is desert land which can be used for free but urban land is far more valuable due to its proximity to desirable features.
Economic rent like this pops up even in human-made domains of potentially infinite expanse, such as the internet. There is no limit to the number of domain names which may exist yet some are far more valuable than those which can be claimed for low-to-no cost. Even social media platforms are valued to include the economic rent of their own user communities. For example, even if there came along a social media platform which was better than Facebook in every way, users would still value Facebook more because it has more community and community-generated activity and content.
I have tried understanding Georgism a few different times, but I struggle to understand pricing: assuming we could fairly solve the transition from a society in which people currently own land, how would land be valued?
Who determines what land is worth? In a society with property rights, the market bids up land that is undervalued according to society's current needs and expectations and bids down land that is overvalued. When not significantly hindered by government zoning policy, it is pretty good at generating more buildings where there is high demand (see Dallas, TX). If the answer is a bureaucracy, it seems like a system of price controls where prices will inevitably be wrong and misallocate assets. I'm not aware of any country that has yet demonstrated the ability to successfully set direct prices of important economic assets for more than a decade without causing huge surpluses or (more commonly) shortages. A direct price control removes all input information from the market, whereas existing price floors (minimum wages), price ceilings, and subsidies tend to create smaller scale problems.
Georgism is also compatible with a system where land is auctioned, it's just that the proceeds of the auction go to the state instead of the owner of the land. So you could do auctions and market stuff. Without the possibility of profit from appreciation, of course, the land value would be much lower. But land has value even without appreciation.
Interesting -- the market aspect is crucial. My only other qualm, which may or may not be better than necessary side effects of capitalism: if someone has "owned" a house for a long time, especially in a growing area, what is their Land Value Tax? Have they not profited through intelligent or lucky speculation by not having an auction since decades back when the price was much lower, and are they not incentivized to hold onto it even if it should be redeveloped? On the other side, will the feds kick people out with eminent domain for the above reasoning?
I came up with a scenario about why I thought this would hinder property improvement, but I think I solved it within the Georgian system:
Let's say Alice buys a piece of property zoned for 10 story buildings at 2mm/year LVT. She invests 30M and 3 years of construction into building a 10 story building that can generate 4mm/year in rent. It will pay itself off in 21 years plus start generating profit. Alice has specialized in being a great property develop but not a property manager. However, she is now TIED to this property -- if she lets it go up for auction, she loses the profits from her improvements. Sure, she can contract out property managers and eat into the profit, but this just increases the time until she can afford to build the next building.
In a capitalist system, Alice can sell the building upon successful completion and immediately profit to the exact degree the market thinks she improved the land's value. That capital can immediately go into the next project and allow better specialization of human resources.
However, I now suppose that the party who "bought" the land from the feds doesn't have to be the specialist who gets contracted to develop it. She can still be paid 30M upon completion and go straight into the next project with a different owner, without ever dealing with an auction.
I potentially like this system a lot, as long as it allows wealth and non-land property rights, and market pricing, but I do need to think about it more. Thanks for helping to explain.
LVT applies to the land value today. If the value increases because a commuter rail station opens, the value of the land goes up, so the price of the tax goes up (you’re effectively paying more tax as you benefit from better society)
If a power station opens next door and price drops, you pay less tax
Presumably it would also be possible to take steps to adjust the LVT. For example, perhaps the first x thousand dollars of a family's primary home is untaxed.
But why? What problem would that rebate seek to solve?
If the concern is that poor people might be unable to afford to stay in their homes, why not target poverty or house prices directly rather than adjusting the tax?
This is the problem -- who determines how much these things are worth? And if you risk other people pricing you out of property you currently hold a lease for (especially because they think the value is going up because of your investments in it) I can't imagine that would encourage any development at all.
If LVT is subject to arbitrary changes outside of precise terms negotiated during the initial auction (which should cover the annual cost plus cost increase schedule).
Ultimately, nothing will incentivize the improvement of the value of the property as much as owning the property. I think it's apparent that total infrastructure development would go down significantly under this system, even if there are other advantages. We can minimize risk by including length of lease in the auction, but if there is a maximum lease length, the end part of that lease will always be devoid of infrastructure improvements.
> This is the problem -- who determines how much these things are worth?
There should be a much more active market in land (land would change hands much more frequently because it doesn't make sense to hold as an investment), which then makes it easy to assess land value.
> And if you risk other people pricing you out of property you currently hold a lease for (especially because they think the value is going up because of your investments in it) I can't imagine that would encourage any development at all.
You're discouraged from building more than you need on land you can barely afford, and in an area that's rapidly changing you're encouraged to build things that you can either easily move, or sell on to future buyer of the land. The intent isn't to encourage development for development's sake, and the result might be less development in areas that are rapidly changing.
> This is the problem -- who determines how much these things are worth? And if you risk other people pricing you out of property you currently hold a lease for (especially because they think the value is going up because of your investments in it) I can't imagine that would encourage any development at all.
This concern is usually addressed by ditching the distorting effects of the periodic auction and of the incentive to try to "steal" capital improvements by abandoning the auction framework and just assessing a yearly property tax proportional to the value of the underlying land were it unimproved. Since ownership and sale of land would still exist in this system, the value of the land for assessing land value tax can be determined by the market value of the land.
'Land ownership' actually means 'rights for exclusive use of land'. Government owns the land but gives out rights to use to people. If oil deposit or gold mine is found on it, the right is often revoked after compensating the rights holder.
The prices for rights of use are determined by market, but usually bundled together with prices of buildings on it.
One way to look at Georgist critique of current land system is that the rights of use are sold once but held infinitely long. If you got lucky and bought a piece of land in downtown Manhattan 200 years ago for 20 bucks, now you wouldn't need to pay anyone for granting you that ownership right. Basically land (and natural resources) are owned by people who got lucky, not by people who actually use it (such as a restaurant which has to rent it from that lucky holder). If the ownership rights were not given for infinite amount of time but reentered into an auction every, say 7 years, the allocation of land would then go to people who actually need it. It is the same economical problem as Domain Name allocation on web.
People 'own' land on paper only. The government actually owns it no matter if you are in China, Europe or United States.
I like the auction aspect the parent described in another comment. However I don't like the idea that the government can revoke at will and eminent domain you out of property even if you paid the tax you won at auction. For example -- what incentivizes people to take their expensive expertise, time and equipment and survey land before placing a bid at auction? If the government is going to be the only one to survey land, that's a great way to kill innovation in the field of natural resource exploration.
Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house?
Yes, many people are not comfortable about being evicted.
In reality that is how majority of people and business operate because they rent from somebody else. Your apartment lease usually expires after a year and you can be 'evicted' by your landlord. Businesess have contracts for longer periods (about 10years) of time because they put more investment into it.
Instead of renting from lucky private landowners, the business owners could just as easily lease from a government for 7 years.
The only question really is how long the auction should repeat after. Every year would mean people would not invest much for risk of non renewal of the contract next year. On the other hand too long between auctions (such as infinite time like in present day situation) and you get huge underutilization because the lucky winner in the first auction is not pressured to sell.
LVT (or this auction mechanism) is based on market price of the land in that area so it changes in time. To prevent sudden spikes in price, the valuation of land should happen in intervals of several years like I described above in the case of an auction.
I would consider “ability to be evicted” to be a great moral wrong, and that access to comfortable housing that doesn’t cause an unreasonable commute to be a basic human right on par with free medical care & education.
It’s hard for me to think of a way to square this without a concept of land ownership and exclusive property rights.
I guess some type of lifelong lease from the government could be OK, but some land is more valuable than other land for living, so then how to allocate the best livable land?
At any rate, I do view the capability to be evicted as a moral wrong.
> I would consider “ability to be evicted” to be a great moral wrong, and that access to comfortable housing that doesn’t cause an unreasonable commute to be a basic human right on par with free medical care & education.
These two ideals of yours are contradictory. The right to not be evicted (in order to better develop the land) can directly prevent the availability of housing with the qualities you require. With the help of zoning boards, which are really just an embodiment of their constituent land owners, isn't this more or less the sum of the housing issue in the bay area? You certainly cannot say that there's any semblance of comfortable hosting with a reasonable commute...
I agree with you that it’s two contradictory forces, and yet I still believe either outcome is wrong. If a person can be evicted from where they live, that is wrong. Yet also if comfortable, nearby, affordable housing (that you did not need to evict others to build) is not widespread for all, that is also wrong.
It’s important to focus on solutions that solve both sides of the problem, and to deny arguments that it’s functionally not possible (which would be an unacceptable outcome).
I don’t mind the contradictory positions in terms of market theory and efficient allocation, and believe it’s important to pursue anyway, that this technical contradiction is fine... necessary even.
The impossibility may be "unacceptable" but it's reality. I believe that at a certain point - e.g. when evicting one means 1000 or 10000 more people are able to afford somewhere decent to live near where they work - eviction becomes a lesser evil. If you're unwilling to make that kind of trade, then however much sophistry you put into "focusing on solutions that solve both sides", more likely you'll just end up never getting those 1000 or 10000 people a place to live.
an outcome can be unacceptable, but you have no choice but to accept it. It's like gravity will pull down, whether you accept it or not.
When you lose the ability to evict, you also lose the ability to rebuild (since you'd need to evict to rebuild).
What is desirable is balance. Where that balance lies is up to the populous, and in san fran, the populous have spoken (by their actions) - they prefer to keep it less dense, and suffer the consequences of high property prices.
I too would love to guarantee to every citizen that they will not be evicted.
Unfortunately it cannot be a universal benefit since not everybody lives in their own. Implementing this non-eviction right would vastly benefit one part of the society at the expense of the other. The benefiting half of society would then proceed to collect vast sums of money from the other half through rent payments.
I personally think if there is a class divide in society then it is exactly because of this supposedly universal 'moral good'.
If Marx lived couple more decades he would see that those capitalists used their hard earned money to buy.. real estate and land. Therefore just becoming new aristocracy displacing the old one. It was not the Marx's capitalist who was the exploiting bad guy. It was the landowner after all. Industrial revolution during Marx era was just a transition of aristocratic titles to the new generation of aristocrats that we now call.. well we call them just 'billionaires'.
why is eviction so bad? provided the person has the resources to move and is given enough notice, I fail to see what is so morally wrong about it. it can certainly be inconvenient and/or disappointing, but it's hardly a heinous evil.
the expectation to live on a specific piece of land indefinitely has always seemed one of the more bizarre entitlements to me. it's basically the only thing we can't make more of.
With a lifelong auction for individuals, perhaps with an agreed upon inflation agreement (which can also be bid in the auction) and a sufficiently long auction cycle for big corporate projects to be worth doing (50 years?), I could see this being feasible. I still don't see a way to condone eviction outside of this period, just because the new land renter A. happened upon unexpected value on the land or B. had more insight to identify the value than other auctioneers. And even with a 50 year cycle, if a business builds a business specific factory, this cycle would discourage more investment into the factory near the end of the "lease" and encourage wastefully leasing some new land and building a new factory on it. There are a lot of theoretical challenges with Georgism, and combined with the impossibility of stripping all existing landowners of their property, it's all just a theoretical exercise. Still an interesting thought experiment though, and could be worth exploring if science opens up new land to divvy up (e.g. on Mars).
To the example of factory and 50 year cycle of auction and potential eviction.
If noone else wished to take over the land on which the factory stood, well then the factory owner renews the lease for another 50 years.
If there was somebody who wished to own that land and offered higher price, well they'd win the auction. However they wouldn't suddenly own the factory. They would still have to pay the price of the factory to the previous owner, much like it is done today.
If they didn't want the factory, only the land under it, and they won the auction but didn't pay for the factory, then that would result in a deadlock situation.
The original factory owner would stop production, but the new owner would be prevented from using it either, but would be stuck with the rent payments for the land under the factory.
Most likely he would sell it back to the previous owner or just not bid for it in the first place.
Only if he really wanted it that much that he would pay for the land rent to the government and price of the factory to the previous owner, he would get it.
And that is pretty much how it works today, so nothing really would change.
How many 50-year-old factories are still operating and making the same thing? My guess is hardly any, and those that are are have likely replaced the majority of their equipment by value, probably multiple times over. You'd be able to plan for the 50 year cycle and align equipment lifetimes etc. with that (whereas currently we see blighted areas because a major rebuilding project is planned someday, but there's no clarity about when); yes the factory owners would be encouraged to wind down their equipment and be prepared to move out if it turned out their land could be put to better use a different way, that's kind of the point. If the cost of moving to a new factory is higher than what someone else could gain by using the land differently, that ought to be reflected in their bids for the land.
> There are a lot of theoretical challenges with Georgism, and combined with the impossibility of stripping all existing landowners of their property, it's all just a theoretical exercise.
While the specific auction mechanism and expropriation of all land is obviously fantasy, substantiatively the same effect can be obtained with property taxes assessed based only on the value of the underlying land and updated frequently (land value tax), with the added benefit of avoiding the distortions of worrying that a lease will expire and someone will outbid you to seize the value of the capital you have invested in improving the property.
The comment you are replying to suggested that 7-year leases could be auctioned. A lease cannot be revoked “at will.” But it does mean that people can be priced out of their homes when the lease expires. That’s the point.
Coincidentally, this is similar to the lease-hold system in Hong Kong. Most land plots revert to the government after a 75 or 99 year lease term. You can sublet land during that period, but whoever directly holds the government lease is obligated to pay an annual tax equal to a percentage of the land's rated value.
>Or will the price keep going up and price you out of your longtime house?
If we don't have a problem with elderly renters getting priced out and not receiving a windfall (public concern for this issue is pretty muted) I don't see why homeowners getting priced out and receiving a windfall is worse.
I always found it deeply ironic that the Howard Jarvis Taxpayers foundation successfully lobbied for prop 13 on the "won't think of the pensioners homeowners" argument and then turned around and lobbied to slash pensions... yet their propaganda still carries weight today.
If you read the stuff Howard Jarvis Taxpayers Association puts out it's mostly "taxation is theft!!1" and starving the beast. I don't believe that people are still buying the whole thing about poor old grandma since it's very easy to make laws specific to them, cf. https://www.cga.ct.gov/2000/rpt/2000-R-0836.htm
> Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house?
The entire point is for the price to keep going up and to eventually price people out of their longtime homes. It is the specific intent of this sort of policy to force people out of their single story homes near downtown SF. Whether you think it's good policy or bad policy can be debated, but proponents of these sorts of policies consider it bad public policy to allow scarce resources to be monopolized by people using them inefficiently, regardless of who those people are or how they came to possess those scarce resources.
In this system people would not have a lot of incentive to keep improving the land. Still I can see some value in it, but there needs to be a away to feel that ownership and having value in taking care of the land.
I'm not an expert, but my understanding is that Georgists often do not advocate literally reselling the land every so many years. Rather they advocate that the value of the land be evaluated periodically and used to set a 100% property tax on that value. However, improvements to the land are not factored into the valuation. The idea then is that the owner can turn a profit by improving the land but not by simply owning the land as is.
Over the long run, does that end up being much different than typical US property taxes? I think the US typical house pays prop taxes every year based on land + improvements. Wouldn’t this be even less of a tax?
The intention of a land value tax (as this is called) is to zero out the component of property taxes based on improvements, but increase the component based on the value of the land itself. Whether this ended up being an increase or decrease in the tax rate would mostly depend on how improved the land was. If the land is very improved, this should end up being a reduction in taxes, and for mostly unimproved land it would be an increase in taxes. The intention is to encourage people who own unimproved land to either improve it or sell it to someone who will.
> but what is the value of the land if it's not the improvements upon the land?
Following this line of reasoning would suggest that all unimproved land is always worthless, which is obviously not true given that people buy unimproved land all the time. Moreover, it would suggest that knocking down a building on a piece of land is never a correct decision, since land with a building on it would always be worth more than that same land with the building removed, which is also obviously not the case.
> Is it the value someone else would've paid?
Yup, the market value of the land were it unimproved. There are various ways to estimate this value.
> ... would suggest that all unimproved land is always worthless, which is obviously not true given that people buy unimproved land all the time.
The problem is what counts as an "improvement". LVT proponents tend to go with the technical/legal definition, which is basically permanent structures built on the property, and consider everything else which contributes to the market value of the property to be part of the "unimproved" value. However, that "unimproved" value was still created by human beings, not an inherent part of the land. Some or all of that "unimproved" value may even be due to the efforts of the owner of the land, without involving any structures on the land itself.
To illustrate, let's say a developer buys some vacant land and, after reserving space for residential lots, adds roads, electricity, water, sewer, communications, convenience stores, etc. Those residential lots are now worth quite a bit more than the original land, despite having no "improvements" as yet. That increase in value is 100% due to the efforts of the developer, and yet a LVT would call it "unearned" and attempt to tax it away. Where is the fairness in that?
but the value (including the location) only exists if the eventual goal of adding improvement to the land is possible (or is doable). If i stipulate that the land is forever unused (e.g., i contaminated it with poison which cannot be removed), then the land would become worthless, regardless of the location!
The Georgist movement (or Single-Tax movement) had a lot of momentum at the beginning of the 20th century. Major political leaders like Winston Churchill, Rutherford B. Hayes, and Sun Yat-Sen were all Georgists. There are various reasons for why the movement lost traction but I think it can mostly be attributed to:
(1) the automobile which increased the accessibility and productivity of formerly-marginal land, lessening the problem of equitable access to land, and
(2) the introduction of the income tax as an alternative to land value taxes. Notable, land monopolists preferred income taxes because as long as their land is unused or underused they are not producing as much income. The Georgist movement then split between those who thought that income tax was a good enough replacement and those who "knew" it wasn't.
There's also a kind of conspiracy theory which claims that (to a certain extent) neo-classical economics (which developed at about the same time that Georgism become popular) was promoted by wealthy and biased land owners and monopolists at the time with an intent to discredit Henry George and obfuscate the role of land in the economy, folding it under the definition of
'capital' to reduce the factors of production to just two, along with labor.
The wealthiest people in America aren't big landholders though. Georgism does nothing to reduce inequality. In fact, it looks like the people pushing Georgism today (wealthy tech bros) are hoping to avoid paying any kind of income or capital gains, and soak people who own land.
This is a typical effort to obfuscate land’s role in the economy and the goal of Georgism overall. The goal is not to redistribute and create financial equality. The goal is to create economic justice: to give each person as much of what they themselves produce plus or minus what it takes to ensure a reasonable living standard for everyone. There are meaningful conversations to be had in the “plus or minus” part of that, but Georgism is primarily concerned with how to eliminate a substantial violation of the first part which is hidden in plain sight.
That’s all Georgism is. When I agree to pay $3000/mo for a crappy studio to be close to a particular park/subway station/employer/school, some large portion of my rent should go to fund the things that enticed me to move there.
I don't know if it's how Georgian works, but this shouldn't mystify you in principle: municipalities do it all the time for property taxes: set a budget for the year (mostly going to schools), then determine every plot's relative value to all of the other plots. Divide up the budget along these percentages.
Georgists and others who support land value taxes generally oppose conventional property taxes because property taxes are usually based on the total value of the property, not just the component of the value that comes from the underlying land.
Well okay, but in the modern era like ours where value is increasingly found in intellectual property and an increasingly mobile workforce, physically commodifying land like that sounds more limiting, wedding the theory to a 19th century economy.
While true, the underlying land is still enormously valuable, and the principle of the land value tax applies to other land-like things, most notably rights to use electromagnetic frequency bands.
How does that work if there are already improvements on the land? You'd either have to auction the land with the improvements—in which the auction price won't indicate how much the land would have fetched on its own—or else stipulate that any improvements must be demolished prior to the auction, which would be massively wasteful.
There are other options, sure. The tax assessors could simply guess, or outright dictate whatever "unimproved value" they choose (i.e. the highest tax they think they can get away with). If the the point is to establish the "unimproved" value of the land through an auction, however, you can't do that when the land and its improvements are inseparable. These are not two distinct economic goods with independent values. The improved land is one good, with one combined value.
Thought experiment for readers, supposed humans magically appear on planet earth when no humans existed before, how would they go about utilizing the land in a manner that is peaceful, sustainable and fair?
A simpler version of this thought experiment would be: Given some land (say 100 acres) how would 2 people go about utilizing the land in a manner that is peaceful, sustainable, least impactful to the environment, fair, protects individual ownership, simple etc. Assume that no government or laws exists. If one can chip away at this problem, I think one will have the solution to most problems created by (but not limited to):
1)Absurdities of law.
2)Property taxes
3)Property ownership
4)Inheritance ( let say later these 2 people have 3 kids)
5)Socialism/capitalism ( these definitions vary depending on who you ask)
6)Zoning issues.
7)Common property.( roads, rivers)
8)Food production and distribution.
9) Etc...( covers innumerable other things, so Tolstoy was right in my opinion - land ownership is the root of most of the economic evil )
This story was faithfully transposed to *bande dessinée" (European comics) by Martin Veyron in 2016. "Ce qu'il faut de terre à l'homme" won a prize at the Angoulême Festival, and I recommend it very much if you can read French. My only complaint with it is that the handful of Cyrillic texts in the drawings are not made of Russian words but simple transliterations of French words.
Among the short novels wrote by Tolstoi, my personal preference is for "Father Sergius". A young prince can't support any more the royal court, so he flees outside of his world, then struggles in trying to find meaning and peace in his life.
> Tolstoy also became a dedicated advocate of Georgism, the economic philosophy of Henry George
> towards the end of his life, Tolstoy become more and more occupied with the economic theory and social philosophy of Georgism.
> He spoke of great admiration of Henry George, stating once that "People do not argue with the teaching of George; they simply do not know it. And it is impossible to do otherwise with his teaching, for he who becomes acquainted with it cannot but agree."
...I have never really looked into it, but I happened on a paragraph that makes it sound like it might be an approach to dealing with the problems people complain about a lot these days:
"Douglas proposed to eliminate the gap between purchasing power and prices by increasing consumer purchasing power with credits which do not appear in prices in the form of a price rebate and a dividend. Formally called a "Compensated Price" and a "National (or Consumer) Dividend", a National Credit Office would be charged with the task of calculating the size of the rebate and dividend by determining a national balance sheet, and calculating aggregate production and consumption statistics."
"Based on his conclusion that the real cost of production is less than the financial cost of production, the Douglas price rebate (Compensated Price) is determined by the ratio of consumption to production. Since consumption over a period of time is typically less than production over the same period of time in any industrial society, the real cost of goods should be less than the financial cost.
For example, if the money cost of a good is $100, and the ratio of consumption to production is 3/4, then the real cost of the good is $100(3/4) = $75. As a result, if a consumer spent $100 for a good, the National Credit Authority would rebate the consumer $25. The good costs the consumer $75, the retailer receives $100, and the consumer receives the difference of $25 via new credits created by the National Credit Authority.
The National Dividend is justified by the displacement of labour in the productive process due to technological increases in productivity. As human labour is increasingly replaced by machines in the productive process, Douglas believed people should be free to consume while enjoying increasing amounts of leisure, and that the Dividend would provide this freedom."
There are townhouses roughly five miles apart in the city where I live that differ by a factor of two in price. If what you say means anything, they should rent for the same amount...? It seems doubtful to me.
The major office complex in the middle of things is almost ten minutes commute from the expensive townhouses and just over ten minutes commute from the cheap ones. Even though it's right beside the expensive homes. So in this particular case, 5 miles is not a long way.
It seemed pretty obvious to me that the difference was that the expensive ones were brand new and the cheap ones were 25 years old. But often people don't think of houses depreciating like cars.
This story has stuck with me for years. Any time I've over-promised what I could deliver or stand to miss a deadline or am otherwise stressed out by situations of my own creation it comes back to me.
This website often focuses on ambition and furiously chasing one's dreams, but it's nice to have reminders that in the end, it's the small comforts and relationships we've built that really matter.
> in the end, it's the small comforts and relationships we've built that really matter.
Or maybe none of that matters at all, since we all die alone one way or another, it's the journey and not the destination. Life is to be lived, experienced, and one could argue dying abruptly in aggressive pursuit of your dreams is ideal.
>There's a common saying that you can't take your stuff with you when you die, but you can't take your memories or relationships either.
The only thing of value we leave behind is our artistic creations. Whatever Javascript adware or trendy C replacement you're hacking on will be obsolete before you finish decomposing. All your "experiential purchases" like travel, relationships, etc. will be gone in a flash. The only thing left will be the art you created. The art you created is of course not entirely your own, it's essentially a restatement of the world cultural traditions, but through the lens of your life experience in a way that only you could create.
And all that art will eventually be gone and forgotten too, so it is ultimately as meaningless as the other things, even if it manages to last a trillion years longer.
how do you know that they're being downvoted? I see this comment all the time on HN, but there is no visible karma on comments, and only a flag option, no downvotes?
I'm glad that Tolstoy found it's place on hacker news. His Christian anarhisam and nonviolence doctrine influence basically all civil right heroes in 20 century. But it is funny how Georgisam is selected. Just wonder could it be related with high property price in bay area.
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We had a translated and simplified version of this story for my Tamil class in elementary school - and distinctly remember this and a few others. So much so, that I googled a few years ago to realize that the original was from Tolstoy
This story reminds me of playing the board game "Deep Sea Adventure" ( https://boardgamegeek.com/boardgame/169654/deep-sea-adventur... ) with some friends. In this game you try to get as much treasure as you can from the sea bottom floor. At the same time you share your oxygen supply with your competitors. We managed to run out of air three times in a row! The final round was particularly amusing: When the players noticed that (only) one player had a chance of making it back to the surface, they made sure to use up the shared oxygen supply since they were doomed anyway.
Fun game, give it a try. Also quite educational, just as this excellent short story.
Absolutely love this short story, it really gets under your skin.
In one sense, I'm pretty sure it's a riff on Jesus' parable of the rich fool (recounted in Luke 12:13-21). In both cases, the sudden & unexpected death of the main protagonist shocks you into thinking through their (and by extension your own) value system.
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[ 1.8 ms ] story [ 245 ms ] threadhttp://www.online-literature.com/tolstoy/2891/
What does your schedule looks like? I have a large catalog of books which Id love to go over, but it can be very hard for me to find the time to simply sit and read beyond sitting on a plane or a bus
I always read after a work and manage more than 2 books a month but, then again, I don't think I've seen a movie or played a video game in at least half a year, so I'm sacrificing on that front.
https://web.archive.org/web/20200105211507/https://www.onlin...
https://www.jstor.org/stable/3487337
The basic point of Georgism is that landownership is the root of most of the economic evil in the world and land should all be expropriated and held in common. (but don't want to expropriate capital or do anything to it, unlike the Marxists: Marx called Georgism "Capitalism's last ditch")
So strangely enough, it's not about greed in general, it's about land specifically.
But it's easy as hell to tax land and impossible to avoid the tax (just show up with cops, what the hell are they going to do, move the land? - and if they don't pay, just sell the land to someone else, although usually the aim is to collect the tax when transactions happen) So tax it. 100%. Georgism's tax suggestions go: have that 100% land tax (not property tax), have no other taxes, that's it. Also tax networks which have an inherent monopoly effect, it was also suggested by Henry George.
Nothing to do with agrarian points of view, really. Georgism was created in SF, it was most popular in NYC, and it was talking about the problems of the first properly modern cities in America and Britain.
The revenue man wanted granddaddy bad, headed up the holler with everything he had, ‘fore my time but I’ve been told, he never came back from Copperhead Road...
But this can be said for anything, no? After all the value of every asset is socially constructed, whether that's shares in a company or land seems irrelevant, so if you buy that logic I feel like the Marxist case makes more sense instead of just arbitrarily stopping at land.
It also seems counterintuitive because it would essentially mean that someone who holds billions in shares or digital assets has no tax burden under the Georgist logic but a small independent farmer does.
> It also seems counterintuitive because it would essentially mean that someone who holds billions in shares or digital assets has no tax burden under the Georgist logic but a small independent farmer does.
Someone living like a billionaire probably owns a much higher value of land (if only what's under their mansion) than a small independent farmer. The land value tax would end up being built into food prices, so farmers wouldn't lose out on the whole unless they're currently growing wastefully; maybe farming would be pushed onto less valuable land, that's sort of the point (but in practice that mostly happens already; farmers near towns wanting to expand would get gradually pushed out via higher taxes rather than getting a windfall for selling up, which is bad for those individual farmers but better for society as a whole).
People don't make the land but they do make the value of the land. Even if that just consists of recognizing the potential in what is already there. LVT does nothing to distinguish between value resulting from the actions of the owner—apart from a very limited set of formally recognized "improvements", mainly permanent structures—and value resulting from the actions of others. And even if part of the "unimproved" value does result from others' actions, these others are not, in general, the ones receiving the tax.
The same is true of the existing system - currently owners pocket all of the value increase despite the vast majority of it being nothing to do with them. LVT is a recognition that most of the value of land comes from the actions of others - not just a handful of immediate neighbours but the whole surrounding community (e.g. most of the value of land in a given city gets its value from the entirety of that city) - and so should rightfully go to an organisation that represents that community as a whole.
Except for the property taxes and local sales taxes which pay for all these things supposedly contributing "unearned" value to the land... and which over time add up to more than the increase in land value.
> despite the vast majority of it being nothing to do with them
> to an organisation that represents that community as a whole
[citation needed x 2]
LVT eliminates the financial incentive to take personal or collective private action to improve the community as a whole. Rather than increasing the value of your property (and your neighbours') your only reward is to be saddled with additional taxes above and beyond the cost of the improvements. The LVT model essentially assumes that the only source of community-level improvements worthy of remuneration is the government. Which is obviously nonsense. If I contribute to the community at my own expense, the benefits accrue not to me but to the government—which may represent "us" in a vague, manipulative sense but certainly doesn't represent me—to be spent more often than not on things I explicitly do not want and which are contrary to my own interests. Governments love to act as though they enjoy an agent/principal relationship with their constituents but neglect the fact that an agent has a individual duty to each principal, not just the majority position. It's an inherent conflict of interest to serve multiple principals with conflicting goals.
Of course, property taxes have a similar issue, but at least they don't have an explicit goal of negating all profit to the property owner; you don't get the full benefit of contributed improvements but you do get the majority of it.
Any organisation that purported to represent the community well enough to make community-level improvements (which will almost inevitably make things worse for some people even if they're a huge gain for the community as a whole), like "we should demolish these buildings to put a rail line in" or "should this area be a park or a factory", would have to incorporate the same feedback mechanisms and so on that would make it a de facto government.
If you're doing something that really improves the community as a whole, under LVT the community government should be willing to fund it, since they'll get back all the value. Indeed they have an incentive to seek out ways to improve the community and encourage neighbourhoods to improve themselves, unlike today.
> Governments love to act as though they enjoy an agent/principal relationship with their constituents but neglect the fact that an agent has a individual duty to each principal, not just the majority position. It's an inherent conflict of interest to serve multiple principals with conflicting goals.
Of course it is. Doing anything on a community scale is inherently difficult, and there will inherently be winners and losers. LVT actually helps even that out though - the gains of community-scale improvements accrue to the government of the community as a whole, but by the same token they also bear the cost of any local deteriorations.
> Of course, property taxes have a similar issue, but at least they don't have an explicit goal of negating all profit to the property owner; you don't get the full benefit of contributed improvements but you do get the majority of it.
Property taxes are a completely backwards way to approach this kind of thing, because they punish the owner for the one kind of community improvement that they actually fully control and spend their own money on. Under LVT you keep the full value of your buildings, landscaping and so on (which are the result of your own toil); you pay taxes on the value of the unimproved land, which is a function of the community as a whole rather than your individual efforts.
Producing enough in the growing season to sustain yourself through the off season is... no small amount of work. You need a reasonably large amount of capital in the form of tools and knowledge to have a reasonable shot at doing so with only your labor. And unless you have a lot of capital in the form of advanced machines, it would be a huge amount of labor.
But that's not the real problem; the real problem is how chancy farming is. Too much rain? no food this year. Not enough rain? no food this year. I mean, there are a lot of things technology can do (like, say, tile drainage and irrigation) that make the growing conditions wider, those things can require significant capital and/or labor, and even then, you can have too much or too little rain. Even if you do everything right, if you are depending on growing your own food, there's a reasonable chance of not getting significant calories for a year or two just 'cause the weather was bad.
Most of our farm subsidies go to crop insurance; the government essentially sees to it that our farmers are made whole if it rains too much or too little, which makes farming a lot more certain, and helps ensure our overproduction of food. (note, I totally support my tax dollars being used for this; If there's anything the world should overproduce, it's food.)
Look at the famine in Guatemala, as people can’t grow enough food due to climate change, leading to mass migration
>paradigm seeks solutions to social and ecological problems, based on principles of land rights and public finance which attempt to integrate economic efficiency with social justice.[6][7]
>Georgism is concerned with the distribution of economic rent caused by natural monopolies, pollution, and the control of commons, including title of ownership for natural resources and other contrived privileges (e.g., intellectual property). Any natural resource which is inherently limited in supply can generate economic rent, but the classical and most significant example of 'land monopoly' involves the extraction of common ground rent from valuable urban locations. Georgists argue that taxing economic rent is efficient, fair, and equitable. The main Georgist policy recommendation is a tax assessed on land value
(Or a ruined old-money aristocrat turned novelist. Or a 21st century San Francisco tech bro who has just realised that he’ll never be able to afford a house.)
One obviously should be able to LEASE the land from the people if they intend to do something useful with it, but otherwise, you are just going to have the land accumulate in the hands of ultra-wealthy who just sit on it. It will appreciate in value since there will be fewer and fewer patches to buy, and then you have a bunch of kids from Succession acting like they own the world, since they happened to inherit it by purely winning the birth lottery.
The social value of private ownership isn't in permitting owners to profit, it's in aligning incentives so that a resource is put to the most productive use. Very often those willing to pay the most money are the ones with the most productive use, and so long as there's a private owner his interests are usually to sell to the highest bidder. More importantly, a private owner can't be corrupted into selling to lower bidders, whereas bureaucratic owners (public or private) can be.[1]
I [very briefly] researched Georgist taxation systems in the U.S. when taking a seminar on land use regulation. My tentative conclusion was that they weren't very effective because the bureaucratic systems for appraisal were very quickly corrupted--not to benefit individual politicians, but to satisfy the electorate, who often find such taxation schemes unfair.
[1] A private owner with multiple interests might be willing to sell one interest to a lower bidder in exchange for a higher bid for some other interest, though.
I agree with you that Georgism isn't perfect. However, I haven't seen a better solution.
You can't. No one person can. That's why centralized economic planning doesn't work. (I'm not trying to suggest that Georgism is centralized planning, or that Georgism doesn't appreciate the value and necessity of price signaling.) And private ownership doesn't necessarily lead to the most efficient allocation. But the point is that private ownership is a stable regime. There are an infinite number of regimes that would offer better allocation, but we haven't yet seemed to find one that is stable, or that we can make stable. (A big part of the problem, I suspect, is cultural, so I don't mean to suggest that Georgist systems are inherently unworkable, just evidently unworkable in recent American history. I think our social and political cultures play a big part in what make land value taxation seem unfair.)
That said, if the public believes land isn't being put to good use it can purchase the land at market price.[1] That still leaves accidental and speculation profits in private hands, but theoretically it puts a ceiling on inefficient allocation. Unfortunately, in some ways (particularly politically) eminent domain powers are at their nader in the U.S. Which is a big part of the reason why we can't accomplish things like California Highspeed Rail. I think that drives home the point that Georgist taxation is less workable today than it ever has been in recent history.
[1] That's required by law in some countries, like the U.S. In some other countries it's not technically required by law but it's often the case that the government does pay market price, simply because to do otherwise would seem unfair and lead to political backlash.
HSR would be easier with a land value tax - there would be a negative incentive to hoard land, so land acquisition costs would be minimised.
California is a great example: HSR battles and Prop 13 revenue dilemmas are things that land value taxes are directly intended to resolve in favor of the public wealth. But both of these phenomena have strong public support propping them up, directly and indirectly. Prop 13 was passed precisely because the public was concerned about the threat of people being priced out of their homes, and that sentiment is at least as strong today as it was back then. Land value taxes would systematize homeowners' worst fears, and they won't be placated by arguments or even evidence that shows that they're better off on average.
I'm tempted to say that people are just irrational or that the public often wants contradictory things, but that would be lazy--true but lazy. In any event, my point is that resolving these things requires more than simply engineering a system that works better on paper. Incentives have to be aligned not just in dollars, but also in votes; not just at the outset, but also on an ongoing basis. Georgist land value taxation schemes are fundamentally predicated on consistent, long-term application. Once exceptions are made it crumbles because not only do perceptions of unfairness increase, the utility of the regime declines. This is true of alot of things, even traditional land taxation, but it's especially true of land value taxes.
[1] Or at least I'll concede that point. It's not obvious to me if and how prospective public works projects would figure into land values under a Georgist system, especially in the rural areas where HSR battles seem to be the worst. (AFAIK, the more urban areas in and around Fresno were acquired and bulldozed rather quickly.) Particularly with land value taxation, the devil is in the details.
So profit that comes solely from owning a natural resource isn't earned; however, profit that comes from the labor of extracting the resource or from making something with the resource is.
However, under that definition there essentially is no such thing as "unimproved value"—unclaimed and unpreserved land would quickly become unusable for any purpose—and the proper LVT assessment in the vast majority of cases would be zero, or else so low as to not be worth collecting.
Additionally, we don't know how much coal there is to still be discovered - we know very well how much land there is.
If LVT is implemented, then there would be incentive to over-extract from the land anything that is valuable and can be avoided from taxation (such as fertility, or minerals, or anything else that rises from the land).
I dont think this can be sustainable - because without clear, exclusive ownership that lasts indefinitely, why would anyone value the land at all?
For the same reason that people already rent property they don't own. There are all sorts of value-generating activities that require exclusive right to some land.
yeah, basically you can go prospecting on anyone's private land (some caveats)
The central thesis of Henry George is that a person is entitled to all value s/he creates. No one creates the value of natural resources like land (but also ocean, radio spectrum, etc.), but landlords get to monopolize its value. Since they have no claim to what they did not create, it would be economically just to tax that value and distribute it.
However, my understanding is that Georgism generally applies its arguments to natural resources in general; it's just that land has traditionally been the most important natural resource. You could also probably extend its arguments to other forms of economic rent.
Labor is in theory infinitely expandable. Capital is infinitely expandable. Land (and natural opportunities) is fixed in supply, so according to Georgists there is no moral argument for favoring somebody for its monopolization. It should be community owned and rights of use to it should be given out to people, priced by a market mechanism.
Labor and capital don't suffer from fixed supply or renewability so according to Georgists there is no need to prevent it from expanding, eg. by slapping taxes on it.
Georgist movement is also known as single-tax or zero-tax movement, because they advocate that there should be no taxes on labor, consumption or capital. The only tax implemented should be the natural monopoly tax (land value tax). They say it would be enough to finace government from it because there are crazy trillions of dollars parked in real estate. Real estate price is actually land value price (location, location, lovation), so only land tax would suffice and there is no need for property taxation, which is actually product of someone's labor.
Some Georgists say that Land Value Tax is not even a tax but a payment for exclusive rights of use. You pay for the service the government gives you directly, therefore it's not a tax. In this way they argue you can run a society with exactly ZERO taxes and paradoxically raise even more money than current tax system.
Same with domain names. People are interested in using shorter domains like abc.com, not long ones such as xyajfbeusnfdbdjak.craptld
The scarcity applies to a grade of land or string, not to all land in the Universe or string space in total.
It is difficult to compare the 'grades' of land, because the grading is not discrete but somewhat continuous.
The hypothetical expansion of the human race in the coming centuries has no bearing on decisions that are made with the next years and decades in mind.
Economic rent like this pops up even in human-made domains of potentially infinite expanse, such as the internet. There is no limit to the number of domain names which may exist yet some are far more valuable than those which can be claimed for low-to-no cost. Even social media platforms are valued to include the economic rent of their own user communities. For example, even if there came along a social media platform which was better than Facebook in every way, users would still value Facebook more because it has more community and community-generated activity and content.
Who determines what land is worth? In a society with property rights, the market bids up land that is undervalued according to society's current needs and expectations and bids down land that is overvalued. When not significantly hindered by government zoning policy, it is pretty good at generating more buildings where there is high demand (see Dallas, TX). If the answer is a bureaucracy, it seems like a system of price controls where prices will inevitably be wrong and misallocate assets. I'm not aware of any country that has yet demonstrated the ability to successfully set direct prices of important economic assets for more than a decade without causing huge surpluses or (more commonly) shortages. A direct price control removes all input information from the market, whereas existing price floors (minimum wages), price ceilings, and subsidies tend to create smaller scale problems.
I came up with a scenario about why I thought this would hinder property improvement, but I think I solved it within the Georgian system:
Let's say Alice buys a piece of property zoned for 10 story buildings at 2mm/year LVT. She invests 30M and 3 years of construction into building a 10 story building that can generate 4mm/year in rent. It will pay itself off in 21 years plus start generating profit. Alice has specialized in being a great property develop but not a property manager. However, she is now TIED to this property -- if she lets it go up for auction, she loses the profits from her improvements. Sure, she can contract out property managers and eat into the profit, but this just increases the time until she can afford to build the next building.
In a capitalist system, Alice can sell the building upon successful completion and immediately profit to the exact degree the market thinks she improved the land's value. That capital can immediately go into the next project and allow better specialization of human resources.
However, I now suppose that the party who "bought" the land from the feds doesn't have to be the specialist who gets contracted to develop it. She can still be paid 30M upon completion and go straight into the next project with a different owner, without ever dealing with an auction.
I potentially like this system a lot, as long as it allows wealth and non-land property rights, and market pricing, but I do need to think about it more. Thanks for helping to explain.
If a power station opens next door and price drops, you pay less tax
If the concern is that poor people might be unable to afford to stay in their homes, why not target poverty or house prices directly rather than adjusting the tax?
If LVT is subject to arbitrary changes outside of precise terms negotiated during the initial auction (which should cover the annual cost plus cost increase schedule).
Ultimately, nothing will incentivize the improvement of the value of the property as much as owning the property. I think it's apparent that total infrastructure development would go down significantly under this system, even if there are other advantages. We can minimize risk by including length of lease in the auction, but if there is a maximum lease length, the end part of that lease will always be devoid of infrastructure improvements.
There should be a much more active market in land (land would change hands much more frequently because it doesn't make sense to hold as an investment), which then makes it easy to assess land value.
> And if you risk other people pricing you out of property you currently hold a lease for (especially because they think the value is going up because of your investments in it) I can't imagine that would encourage any development at all.
You're discouraged from building more than you need on land you can barely afford, and in an area that's rapidly changing you're encouraged to build things that you can either easily move, or sell on to future buyer of the land. The intent isn't to encourage development for development's sake, and the result might be less development in areas that are rapidly changing.
This concern is usually addressed by ditching the distorting effects of the periodic auction and of the incentive to try to "steal" capital improvements by abandoning the auction framework and just assessing a yearly property tax proportional to the value of the underlying land were it unimproved. Since ownership and sale of land would still exist in this system, the value of the land for assessing land value tax can be determined by the market value of the land.
The prices for rights of use are determined by market, but usually bundled together with prices of buildings on it.
One way to look at Georgist critique of current land system is that the rights of use are sold once but held infinitely long. If you got lucky and bought a piece of land in downtown Manhattan 200 years ago for 20 bucks, now you wouldn't need to pay anyone for granting you that ownership right. Basically land (and natural resources) are owned by people who got lucky, not by people who actually use it (such as a restaurant which has to rent it from that lucky holder). If the ownership rights were not given for infinite amount of time but reentered into an auction every, say 7 years, the allocation of land would then go to people who actually need it. It is the same economical problem as Domain Name allocation on web.
People 'own' land on paper only. The government actually owns it no matter if you are in China, Europe or United States.
Similarly, if you "bought" a piece of land you just use for a single story home near downtown SF 30 years ago, are you still paying the same LVT you got at action back then? Or will the price keep going up and price you out of your longtime house?
In reality that is how majority of people and business operate because they rent from somebody else. Your apartment lease usually expires after a year and you can be 'evicted' by your landlord. Businesess have contracts for longer periods (about 10years) of time because they put more investment into it.
Instead of renting from lucky private landowners, the business owners could just as easily lease from a government for 7 years.
The only question really is how long the auction should repeat after. Every year would mean people would not invest much for risk of non renewal of the contract next year. On the other hand too long between auctions (such as infinite time like in present day situation) and you get huge underutilization because the lucky winner in the first auction is not pressured to sell.
LVT (or this auction mechanism) is based on market price of the land in that area so it changes in time. To prevent sudden spikes in price, the valuation of land should happen in intervals of several years like I described above in the case of an auction.
It’s hard for me to think of a way to square this without a concept of land ownership and exclusive property rights.
I guess some type of lifelong lease from the government could be OK, but some land is more valuable than other land for living, so then how to allocate the best livable land?
At any rate, I do view the capability to be evicted as a moral wrong.
These two ideals of yours are contradictory. The right to not be evicted (in order to better develop the land) can directly prevent the availability of housing with the qualities you require. With the help of zoning boards, which are really just an embodiment of their constituent land owners, isn't this more or less the sum of the housing issue in the bay area? You certainly cannot say that there's any semblance of comfortable hosting with a reasonable commute...
It’s important to focus on solutions that solve both sides of the problem, and to deny arguments that it’s functionally not possible (which would be an unacceptable outcome).
I don’t mind the contradictory positions in terms of market theory and efficient allocation, and believe it’s important to pursue anyway, that this technical contradiction is fine... necessary even.
an outcome can be unacceptable, but you have no choice but to accept it. It's like gravity will pull down, whether you accept it or not.
When you lose the ability to evict, you also lose the ability to rebuild (since you'd need to evict to rebuild).
What is desirable is balance. Where that balance lies is up to the populous, and in san fran, the populous have spoken (by their actions) - they prefer to keep it less dense, and suffer the consequences of high property prices.
Unfortunately it cannot be a universal benefit since not everybody lives in their own. Implementing this non-eviction right would vastly benefit one part of the society at the expense of the other. The benefiting half of society would then proceed to collect vast sums of money from the other half through rent payments.
I personally think if there is a class divide in society then it is exactly because of this supposedly universal 'moral good'.
If Marx lived couple more decades he would see that those capitalists used their hard earned money to buy.. real estate and land. Therefore just becoming new aristocracy displacing the old one. It was not the Marx's capitalist who was the exploiting bad guy. It was the landowner after all. Industrial revolution during Marx era was just a transition of aristocratic titles to the new generation of aristocrats that we now call.. well we call them just 'billionaires'.
the expectation to live on a specific piece of land indefinitely has always seemed one of the more bizarre entitlements to me. it's basically the only thing we can't make more of.
If noone else wished to take over the land on which the factory stood, well then the factory owner renews the lease for another 50 years.
If there was somebody who wished to own that land and offered higher price, well they'd win the auction. However they wouldn't suddenly own the factory. They would still have to pay the price of the factory to the previous owner, much like it is done today.
If they didn't want the factory, only the land under it, and they won the auction but didn't pay for the factory, then that would result in a deadlock situation.
The original factory owner would stop production, but the new owner would be prevented from using it either, but would be stuck with the rent payments for the land under the factory.
Most likely he would sell it back to the previous owner or just not bid for it in the first place.
Only if he really wanted it that much that he would pay for the land rent to the government and price of the factory to the previous owner, he would get it.
And that is pretty much how it works today, so nothing really would change.
While the specific auction mechanism and expropriation of all land is obviously fantasy, substantiatively the same effect can be obtained with property taxes assessed based only on the value of the underlying land and updated frequently (land value tax), with the added benefit of avoiding the distortions of worrying that a lease will expire and someone will outbid you to seize the value of the capital you have invested in improving the property.
If we don't have a problem with elderly renters getting priced out and not receiving a windfall (public concern for this issue is pretty muted) I don't see why homeowners getting priced out and receiving a windfall is worse.
I always found it deeply ironic that the Howard Jarvis Taxpayers foundation successfully lobbied for prop 13 on the "won't think of the pensioners homeowners" argument and then turned around and lobbied to slash pensions... yet their propaganda still carries weight today.
The entire point is for the price to keep going up and to eventually price people out of their longtime homes. It is the specific intent of this sort of policy to force people out of their single story homes near downtown SF. Whether you think it's good policy or bad policy can be debated, but proponents of these sorts of policies consider it bad public policy to allow scarce resources to be monopolized by people using them inefficiently, regardless of who those people are or how they came to possess those scarce resources.
https://en.wikipedia.org/wiki/Land_value_tax
but what is the value of the land if it's not the improvements upon the land?
If i left the land wild and free and un-used, what would the the value? Is it the value someone else would've paid?
Following this line of reasoning would suggest that all unimproved land is always worthless, which is obviously not true given that people buy unimproved land all the time. Moreover, it would suggest that knocking down a building on a piece of land is never a correct decision, since land with a building on it would always be worth more than that same land with the building removed, which is also obviously not the case.
> Is it the value someone else would've paid?
Yup, the market value of the land were it unimproved. There are various ways to estimate this value.
The problem is what counts as an "improvement". LVT proponents tend to go with the technical/legal definition, which is basically permanent structures built on the property, and consider everything else which contributes to the market value of the property to be part of the "unimproved" value. However, that "unimproved" value was still created by human beings, not an inherent part of the land. Some or all of that "unimproved" value may even be due to the efforts of the owner of the land, without involving any structures on the land itself.
To illustrate, let's say a developer buys some vacant land and, after reserving space for residential lots, adds roads, electricity, water, sewer, communications, convenience stores, etc. Those residential lots are now worth quite a bit more than the original land, despite having no "improvements" as yet. That increase in value is 100% due to the efforts of the developer, and yet a LVT would call it "unearned" and attempt to tax it away. Where is the fairness in that?
Location.
A free and un-used plot in SF is worth a lot.
but the value (including the location) only exists if the eventual goal of adding improvement to the land is possible (or is doable). If i stipulate that the land is forever unused (e.g., i contaminated it with poison which cannot be removed), then the land would become worthless, regardless of the location!
They care about what a currently empty lot (perhaps with necessary building permissions) fetches on the market.
There are lots of reasons great ideas may not take off, including the difficulty of grokking them and/or entrenched interests.
(1) the automobile which increased the accessibility and productivity of formerly-marginal land, lessening the problem of equitable access to land, and
(2) the introduction of the income tax as an alternative to land value taxes. Notable, land monopolists preferred income taxes because as long as their land is unused or underused they are not producing as much income. The Georgist movement then split between those who thought that income tax was a good enough replacement and those who "knew" it wasn't.
There's also a kind of conspiracy theory which claims that (to a certain extent) neo-classical economics (which developed at about the same time that Georgism become popular) was promoted by wealthy and biased land owners and monopolists at the time with an intent to discredit Henry George and obfuscate the role of land in the economy, folding it under the definition of 'capital' to reduce the factors of production to just two, along with labor.
That’s all Georgism is. When I agree to pay $3000/mo for a crappy studio to be close to a particular park/subway station/employer/school, some large portion of my rent should go to fund the things that enticed me to move there.
https://en.wikipedia.org/wiki/Land_value_tax
https://www.youtube.com/watch?v=gD_dZvPwAj0
You can use an auction.
Eg you can auction the land off to the highest bidder for a few years at a time.
Thought experiment for readers, supposed humans magically appear on planet earth when no humans existed before, how would they go about utilizing the land in a manner that is peaceful, sustainable and fair?
A simpler version of this thought experiment would be: Given some land (say 100 acres) how would 2 people go about utilizing the land in a manner that is peaceful, sustainable, least impactful to the environment, fair, protects individual ownership, simple etc. Assume that no government or laws exists. If one can chip away at this problem, I think one will have the solution to most problems created by (but not limited to):
1)Absurdities of law.
2)Property taxes
3)Property ownership
4)Inheritance ( let say later these 2 people have 3 kids)
5)Socialism/capitalism ( these definitions vary depending on who you ask)
6)Zoning issues.
7)Common property.( roads, rivers)
8)Food production and distribution.
9) Etc...( covers innumerable other things, so Tolstoy was right in my opinion - land ownership is the root of most of the economic evil )
Among the short novels wrote by Tolstoi, my personal preference is for "Father Sergius". A young prince can't support any more the royal court, so he flees outside of his world, then struggles in trying to find meaning and peace in his life.
> Tolstoy also became a dedicated advocate of Georgism, the economic philosophy of Henry George
> towards the end of his life, Tolstoy become more and more occupied with the economic theory and social philosophy of Georgism.
> He spoke of great admiration of Henry George, stating once that "People do not argue with the teaching of George; they simply do not know it. And it is impossible to do otherwise with his teaching, for he who becomes acquainted with it cannot but agree."
Land value tax explained in 10 minutes:
https://www.youtube.com/watch?v=gD_dZvPwAj0
https://en.wikipedia.org/wiki/Social_credit
...I have never really looked into it, but I happened on a paragraph that makes it sound like it might be an approach to dealing with the problems people complain about a lot these days:
"Douglas proposed to eliminate the gap between purchasing power and prices by increasing consumer purchasing power with credits which do not appear in prices in the form of a price rebate and a dividend. Formally called a "Compensated Price" and a "National (or Consumer) Dividend", a National Credit Office would be charged with the task of calculating the size of the rebate and dividend by determining a national balance sheet, and calculating aggregate production and consumption statistics."
"Based on his conclusion that the real cost of production is less than the financial cost of production, the Douglas price rebate (Compensated Price) is determined by the ratio of consumption to production. Since consumption over a period of time is typically less than production over the same period of time in any industrial society, the real cost of goods should be less than the financial cost.
For example, if the money cost of a good is $100, and the ratio of consumption to production is 3/4, then the real cost of the good is $100(3/4) = $75. As a result, if a consumer spent $100 for a good, the National Credit Authority would rebate the consumer $25. The good costs the consumer $75, the retailer receives $100, and the consumer receives the difference of $25 via new credits created by the National Credit Authority.
The National Dividend is justified by the displacement of labour in the productive process due to technological increases in productivity. As human labour is increasingly replaced by machines in the productive process, Douglas believed people should be free to consume while enjoying increasing amounts of leisure, and that the Dividend would provide this freedom."
It seemed pretty obvious to me that the difference was that the expensive ones were brand new and the cheap ones were 25 years old. But often people don't think of houses depreciating like cars.
This website often focuses on ambition and furiously chasing one's dreams, but it's nice to have reminders that in the end, it's the small comforts and relationships we've built that really matter.
and says just the same things about comforts, relationships, and generally love, which really matter:
https://www.gutenberg.org/files/6157/6157-h/6157-h.htm#link2...
Or maybe none of that matters at all, since we all die alone one way or another, it's the journey and not the destination. Life is to be lived, experienced, and one could argue dying abruptly in aggressive pursuit of your dreams is ideal.
There's a common saying that you can't take your stuff with you when you die, but you can't take your memories or relationships either.
There's plenty of reasons to cultivate relationships in the present moment without justifying it by anticipating regret on your deathbed if you don't.
And there's plenty of reasons to spend this life enjoying time with yourself.
There are lessons you can learn only in deep relationships and lessons you can learn only through extended time by yourself.
I wouldn't be prepared to call a life lived in isolation and in harmony with nature a regretful life at all.
The only thing of value we leave behind is our artistic creations. Whatever Javascript adware or trendy C replacement you're hacking on will be obsolete before you finish decomposing. All your "experiential purchases" like travel, relationships, etc. will be gone in a flash. The only thing left will be the art you created. The art you created is of course not entirely your own, it's essentially a restatement of the world cultural traditions, but through the lens of your life experience in a way that only you could create.
Why this comment? I don't see a report button.
- little bit more...
http://www.metafora.ch/wp-content/uploads/2015/06/Tolsto%C3%...
It teaches the concept of "good is good enough" and the consequences of greed.
Fun game, give it a try. Also quite educational, just as this excellent short story.
In one sense, I'm pretty sure it's a riff on Jesus' parable of the rich fool (recounted in Luke 12:13-21). In both cases, the sudden & unexpected death of the main protagonist shocks you into thinking through their (and by extension your own) value system.