Unfortunately, most of the political changes that I want to see go against some special interest. Examples include liberalizing professional licensing, reducing medical paternalism, and streamlining the litigation system. I can think of a zillion ways to do this, but every one of them cuts out some toll booth with concentrated benefits and diffuse costs, and our political system is not capable of dealing with such things in a reasonable way.
I am very open to be told strategies to fight this more effectively without becoming a full time career activist for years on end for one issue at a time.
The OP is saying, if you show up with a bill to fix one of these problems, in a scoped way — like, actual working text they can put to a vote, not a general ideal of what to do — and can explain exactly what you're trying to solve, you have a decent chance of them putting it on the floor.
Just in general saying "please fix professional licensing" isn't actionable, you aren't doing the work for them. You're asking them to turn a vague idea into law, when it wasn't their problem to start with.
I speculate that that form of corruption is concentrated at the large scale. Town councillors where i live don't have campaign budgets. They barely have campaigns.
Get a bunch of town councils on side and you're better placed to tackle the vested interests at the next level up.
I'm not saying this doesn't happen, but probably 80% of the value of lobbying comes from just showing up and talking to the representative. You won't know what works, unless you do the same.
Well, I wouldn't even expect to be able to have access to any platform to be taken seriously enough even if I had such a bill. For example, most professional licensing is at the state level, so it requires a state legislature vote. I've already spoken to both of the state representatives' offices for my area, and they give me a hard wall of they won't even talk to me about it in any detail unless I come back with a huge number of people demanding the same. And, I can't get that because of concentrated benefits and diffuse costs — very few people will both care enough to show up, and be on the side that is not the special interest with concentrated benefits (i.e., current license holders).
Could you please stop posting unsubstantive comments and flamebait? You've unfortunately been doing it repeatedly. It's not what this site is for, and destroys what it is for.
You've been here a long time, and it's dismaying to see a longstanding user degrade the site like this.
I think LVT does have a history in US, e.g Pittsburgh.
Also Georgism is 100% LVT -> A land tax alone has been the recommendation of many economists before and after George - From Smith, Riccardo, Mill to Friedman. Across classical, neoclassical, Keynesian, Austrian schools. If there's one thing economists can agree on, it's that land tax is better than income tax.
Absolutely terrible idea. So based on this no one can just buy land and settle down. You have to pay the government rent in perpetuity. It’s asinine and unconstitutional.
> You have to pay the government rent in perpetuity.
You are paying the government rent in perpetuity for the services they provide, including enforcement of your property rights. If you wish to live on land without paying government rent, you will need to go to a place without effective government. Today, that would be Syria, parts of Sudan, or Mali as examples. I doubt you want to live in those places as a 1st world resident, but if you do, there's little stopping you.
It’s exactly the correct idea. If the value of your land rise as a positive externality, it only makes sense that you contribute some of that back to the society that effected the rise in the first place.
Vast majority are realizing their gains as rent. A land tax would just be taxing those gains before they can be recycled into the real-estate market. Perfectly just in that case.
If you're talking about an individual not using the land commercially - well theoretically the tax burden lowers the sale price. You don't pay both. At 100% land tax, the sale price would be zero. You pay only as you use the land. That also seems just to me.
Well I have news for you… governments are coming for unrealized gains, they will not care if the money is on hand, they’ll fire sell your property if you don’t get a loan to pay the taxes. It’s a mathematical inevitability. And by that I mean governments are going broke and will try to find ever more creative ways to raise money, and unrealized gains, tax normalization, is one of the bigger leavers.
Where I live, the government owns about 40% of the value of my labour. I have to rent my own body in perpetuity. Meanwhile my second biggest expense is a mortgage I pay for land that nobody created.
How much of the land value of your country do you currently own? A land value tax is likely to increase the amount of land you own (the profits of). I don't think US tracks land values as accurately as countries with some kind of land tax.
There was also a community in the deep south. And I once read a case study about a town that tried it in, IIRC, New Mexico.
Full LVT never works. It always ends up shot through with exceptions and loopholes and, in the case study, inducing corruption. And it's all predictable, too, if you know anything about taxation policy and American political culture. For full LVT you'd need to start from a blank slate, not just from a legal perspective but from people's expectations about property ownership.
An analogy just occurred to me. Imagine an income tax not on what you currently earn, but on what you could earn given your schooling, credentials, experience, etc, and the available jobs within your region. Imagine how utterly unfair people would feel about that, and how quickly such a scheme would fall to widespread political pressure.
I get why an LVT makes sense from an economic perspective, but in practice it feels nearly as unfair as the above. Residents especially, but small and medium sized businesses would very quickly lobby to eviscerate an LVT. Imagine long-time residents getting kicked out not because a developer wants to make buck, but because the tax system requires that to happen.
There's zero chance such a scheme could survive intact politically. In Pittsburg it's an LVT in name only, with a long list of exceptions and curious appraisals. And once it's applied ad hoc, which it must, there's all manner of distortions and incentives for corruption.
There are many ways for land use and tax policy to improve, but you have to come at from the perspective of improving the existing system, not revolutionizing it with an LVT. And you could probably get closer to an LVT by smart incremental reform than you could by trying to nominally pursue an LVT.
Georgists would say that if some corporation built Disneyland next door, I no longer deserve to live there. How am I to compete with the vast productivity of a massive corporation?
Where do I deserve to live then? Only where my productivity matches the economic bar of those around me?
I'm getting old and tired. Am I only allowed in a retirement home?
On the contrary, Georgists would say that if some corporation built Disneyland next door, they have to compensate the local community for their use of that valuable land. Local homeowners have to do the exact same thing, but a single home would pay vastly less tax compared to the much more expansive Disneyland. So even the homeowners would marginally benefit in that scenario. Land is always valued according to the potential highest and best use, so the fact that a Disneyland may or may not have been built in any specific location matters less than one might expect.
To an economist, the highest and best use of the land around disneyland is not my home. It's not housing. It's hotels, motels, restaurants. So my land would now be taxed at that rate, until I'm forced out
For devil's advocate's sake, how is this not state sponsored gentrification?
The problem economists would point out is that this is a fully general argument against any development. Which is exactly what leads to the negative side of gentrification - people eventually being forced out of their communities, because there's way too little developed real estate and the rent is too damn high. Georgism lowers rents by pushing towards the highest and best use of land, which is the anti-gentrification move.
In your specific example, you shouldn't assume that the supposed change in the "highest and best use" will be enough to price you out if you're a typical homeowner (not a vulnerable renter in a sharply gentrifying area): the numbers don't really pencil out that way. High land values exist in some places, but they're quite rare and quite concentrated.
The solution to this is to use that LVT revenue to fund UBI, such that the income from all that Disneyland-related land value offsets your own LVT burden.
In a mathematically-perfect setup (100% LVT going entirely to UBI, with zero overhead and zero other government expenditures), the break-even point where your LVT exactly equals your UBI would mean that you own your exact equal share of that tax jurisdiction's total land value; if you own more, then you pay for it, and if you own less, then you get paid for it. Obviously in the real world some of that LVT revenue has to go toward paying people to collect taxes / distribute income checks (not to mention the many other functions of a typical government), but the point is that LVT+UBI produces a self-balancing system that maximizes fairness even for people using their land “non-productively”.
> Imagine an income tax not on what you currently earn, but on what you could earn given your schooling, credentials, experience, etc, and the available jobs within your region. Imagine how utterly unfair people would feel about that, and how quickly such a scheme would fall to widespread political pressure.
Yep, great analogy. LVT is the optimum tax from the point of view of maximising production incentives, but actually practical ways of extracting significant revenues from people tend to skew towards "this person/organization has liquid funds available and wants to do something enough to pay the tax on top". (For related reasons LVT-style approaches to taxation work rather well when the finite resource being taxed is something like broadcast spectrums which the average person doesn't own)
As for Single Taxing, convincing the public theres some ethical principle that PE funds buying tech stocks deserve to keep all of the rewards for risking their money on a particular venture and homeowners who lived through the area's dodgy-reputation years don't is a complete non-starter even though anyone with an economics degree can tell you why such an argument might be made...
Not sure if you realize this, but most businesses and nearly half of residents pay exactly such a tax. It's called 'rent' and is based on a 'market rate' which is exactly the amount that could be earned. They get kicked out all the time! That's actually what created the political demand for LVT!
You even pay rent when you buy a house. The value of the land is the market expectation of the value of future rents.
You can have a less than 100% LVT to get some of the advantages without upsetting the apple cart. Common in many jurisdictions.
The far that economically right wing people like Milton Friedman supported LVT is a great argument against landlord type labelling LVT as far-left and attempting to push the idea outside the Overton window.
I think the only valid argument against is it is that a significant LVT would punish those who've worked for their wealth as they've already paid significant income tax. But there are plenty of ways to introduce it gradually.
You can say that land tax might be better than income tax but it's hard to argue that both land tax and income tax is better than just income tax. This is the biggest reason why new tax modalities are considered unworkable.
We already have property tax + income tax, and property tax is land value + value of improvements. From TFA, the immediate proposal is just allowing the property tax to assess the land value and value of improvements at two different rates, with the rate on improvements decreasing to remove incentives against improvements.
It should! The public (through taxes) shouldn't be forced to subsidize the cost of a parking lot. If the parking lot was valuable to the market, the opportunity cost of the land not being used for some other purpose would be priced in (either through consumers paying more for parking, or businesses subsidizing the cost for consumers as it's profitable for them to do so). Parking lots paying lower property taxes subsidizes economic inefficiency.
Personally I’d rather Land tax revenue be distributed evenly as a citizens dividend, and separate from the
Those who use their fair share are no change, those using more see taxes go up, those using less see a rebate.
The more valuable Land a business uses the more they have to pay, encouraging more efficient utilisation. Their competitor using less Land has lower taxes and can thus out compete them.
Land of course isn’t just dirt, it’s any limited natural resource.
> I think LVT does have a history in US, e.g Pittsburgh
Yeah, I looked at the map in the article and thought, wait a minute, why is Pennsylvania not colorcoded if Pittsburgh has a land value tax? So the map is only showing states that do? I didnt know there were any states that tax land. But do remember being confused when I moved to Pittsburgh by there being two separate taxes - for land and for property.
I also think that the pittsburgh example shows that LVT is meaningless. All homeowners care about here is their total real estate tax. How it is split between land and property nobody pays attention to.
Right exactly. And by raising land tax and lowering (ha) or keeping constant property tax they discourage vacant lots without punishing homeowners even more, which is what happens everywhere else.
> If there's one thing economists can agree on, it's that land tax is better than income tax.
This is overstating the case by a lot. There is a lot of discussion about land value taxes being efficient for various means, but there are far fewer economists who would suggest that 100% LVT is a good idea.
It just wouldn’t be popular. It would instantly get filled with holes and exceptions and distorted until it tries to approximate something else.
Some of the high level economic features that 100% LVT advocates want, like forcing people out of their properties when they become too valuable for other uses, are actually extremely unpopular with people who actually live in homes. You would get a wave of cases where grandma got pushed out of her forever home because the LVT got too expensive and a developer bulldozed it to build a strip mall instead. Under the economic model this is a good thing because the land is being used for its best value, but people actually hate this stuff.
Land value taxes are also really bad at progressive taxation. The hardcore LVT people think this is a good thing because they talk about taxes as “disincentivizing extra work” but we all know that taxes have never stopped people from earning money. Going full LVT puts us in ridiculous situations where someone who earns $500K for a tech company but works remote from a luxurious house somewhere where land is not valued much will pay almost nothing in taxes, but a family with modest income who works a trades job (which generally requires being close to a population center) will have to live in some form of housing subject to very high taxation, therefore paying a lot in taxes.
If you still don’t see it, imagine the outrage when people realized that some billionaires are barely paying more in taxes than a family of four in a modest house in a city where land is valuable.
The more you read about Georgism you more you realize how it’s not as popular with economists as it’s portrayed. There is valuing in taxing land, but we already do that! The debates about eliminating other taxes and replacing them all with LVT is something else, and it’s not universally popular at all.
> there are far fewer economists who would suggest that 100% LVT
Yeah that's the exact distinction I was drawing. The article says Georgism but talks about land tax in general, which is popular with many non-Georgist economists.
However, I have to take issue with your example
1) Land is effectively nationalized under 100% LVT. Worker likely own (the profits of) more land than before
2) The value of the land where the tradesman works is already used against him, to extract the majority of hte profits of his labor. He already pays the land value tax - to his landlord. From his perspective, the burden changes little while the wealthier lose an avenue to make money without working.
3) A luxurious house / lifestyle still requires paying land tax on the things you consume (the land of course and notably energy sources, minerals, timber, building materials, etc). The kind of spartan lifestyle required to truly avoid this tax works now too - incorporate as a company and don't pay yourself a salary.
4) I think very few people care about a $500k salary tech workers, or footballers, or what have you. It's the billionaire oligarchs influencing politics who attract the most attention.
5) Current day oligarchs derive a lot of their wealth from land and other monopoly rents, not from simply 'working more' or 'contributing more value'. This is resented by many. When people get rich by contributing (relatively more) value, they are usually widely praised
The majority of Americans own the home they live in. That’s the real issue here. The landlord the tradesman is enriching is himself.
If you incorporate and don’t pay yourself a salary you still owe corporate taxes.
People absolutely care about the tax rate techies making 500k are paying. They’ll care even more when the billionaires start blasting the airwaves with ads about how unfair it all is.
Athletes have the highest tax rate in the country, why do you think people don’t care about their tax rate?
As far as I know the only tech billionaire with significant land holdings is gates. Zuckerberg and Ellison have big holdings too but not compared to the land per wealth that normal Americans have.
> The majority of Americans own the home they live in
That's the biggest obstacle but also the biggest motivation for increasing land tax. The number is barely 50% currently and falling fast. Of those 40% are owned outright, the rest have mortgages.
This isn't even accounting for commercial real estate and farmland. People complain about grocery price gauging where I live but supermarkets are no more profitable than before covid - they don't realize the main expense change has been land rent.
Once you take out a mortgage you're committed to speculating on that land's future value. If that expectation doesn't pan out, you get a GFC. A gradual land tax would remove some fuel from that fire.
> If you incorporate and don’t pay yourself a salary you still owe corporate taxes
Well yes but actually no - e.g 'buy borrow die'. Regardless, my point is avoiding a land tax isn't as simple as living somewhere with cheap land (it requires consuming less), and people (companies) do also avoid income taxes (it doesn't require consuming less).
> Athletes have the highest tax rate in the country, why do you think people don’t care about their tax rate?
I've never heard anyone talk about this. If I search 'taylor swift tax rate' vs 'elon musk tax rate' I think it's clear.
> As far as I know the only tech billionaire with significant land holdings is gates
Why limit to tech billionaires (who do own lots of land)? The class that specifically didn't make their money from land monopolies, and who pay little effective tax under current system anyway? Trump, Kushner, Witkoff come to mind.
If you're concerned about taxing tech specifically - well George is one of very few people in the 1800s who genuinely considered the full AI + robotics case.
> 1) Land is effectively nationalized under 100% LVT.
You're close to understanding why people wouldn't like it.
100% LVT schemes are basically a mechanism for letting the government force people to do things that the government wants. You want to live in your forever home that you and your husband worked for 50 years to afford? Sorry, government has other plans for that land and now it's too expensive for you to keep it.
The utopian use case that proponents talk about is replacing parking lots with high rise apartment buildings, which everyone loves because it feels like a win for the people and a loss for developers. The more realistic use cases would be much less popular, like the 90-year old couple getting forced out of their forever home because it's close to a substation, which suddenly turned that land into highly valuable property for data centers, which will happily pay those taxes and bulldoze the homes.
Every time I read a 100% LVT piece it's focused on the parking lots to houses type story. They either ignore the more obvious problems of people being forced out of their homes everywhere for businesses to take over, or they do a hand-wavey thing to say it's all for the greater good and we shouldn't care.
Every 100% LVT argument turns into an argument against private property ownership and in favor of a central planning type land reallocation, but with the final use case going to the highest bidder.
This line of reasoning never made sense to me. If the value of the land is going up enough to make an impact on the month to month financials then it makes sense to dip into the equity of the property. Presumably the overall equity still goes up? Beneficiaries still inherit more in fiat terms? What’s the issue here?
Also datacenters are absolutely not going to be built on ultra desirable land, why would the developer ruin the land value that way?
Land is worthless under 100% LVT. Your land value going up just means you owe the government more in rent every year, since the government owns all the land rents. The only real solution to this problem is prop 13 I think which georgists hate. Nationwide prop 13(only on homes) + LVT is still probably better than the current system though imo, although it creates a huge incentive to never move
90 year-olds may well have bought land at a bargain and would therefore suffer somewhat under an LVT. It's a transition problem though - since in the 100% LVT world the couple didn't have to work 50 years (and pay vast interest to a banker) to get that house.
19 year-olds on the other hand already compete with businesses for land (especially corporate landlords - who pay more than datacenter owners) and are losing rapidly.
You do lose the option of speculation - buy early before a town or region is built up. In the current system, speculation is not an option, it is compulsory.
Also you can't force everyone out of their houses - people could simply reserve land for residential purposes (as is already the case). It is still a democratic system, after all.
Finally, western governments already use eminent domain to repurpose land. It's already a part of our system.
Alternatives like aggressive up zoning and development would benefit this cohort and be welcomed as well. It's very natural to welcome things that benefit you
About half might. But then another half will have dealt with actually moving a confused, possibly suffering from dementia, elderly person, managing all of the affairs (and forgetting to do some, changing health care insurance), creating an unnecessary multiyear fuck you in your life while trying to manage a job and a family, and the policy will get torched.
Allowing the elderly to stay where they are isn't just about protecting vulnerable boomers, it's about not being a problem for responsible people in the next generation. You could also be one of those no-contact assholes and never have to deal with your parents when they get screwed by displacement, land value tax away.
I suspect you're right, in the same way that a lot younger people really like any ideas like blanket student loan forgiveness because they have student loans and are receptive to any idea that involves someone else paying for them.
Like most ideas in this category, they become less popular as people grow older and build up some of their own assets. I would expect popularity of this idea to fall of sharply around the age that people start buying a home and see their property tax bill go up.
Practically, this makes it a complete dead end. Much to my lament in every election, younger people don't vote as much as they post online and respond to polls. Older people don't post online and respond to polls as much as they actually go out and vote.
This is why the Georgism thing always seems popular on niche internet boards, but would never get anywhere in a real political system.
I’ve since learned that overly online keyboard warriors are the least important people to convince. The most important people are on your local city council or state legislature. Furthermore, instead of wasting time with hard cases or elected officials who are dead-set against your ideas, you’re much better off finding and working with people who are already interested in your principles. This often means giving up on your own city or state, at least for the time being, and pursuing a “succeed anywhere” strategy instead.
We're about to have a board vote eliminating single-family zoning (I expect us to win) and this rings extremely true about local politics. If you count "votes" in Facebook comments --- Facebook is where all our local politics happen --- you'd think this is the most contentious issue in the world. But in our last mayoral election, you'd draw the same conclusion about the race being tight, and in fact the progressive rinsed the moderate by a huge margin.
The same thing is very true of public meetings; the turnout for comment at those things is almost never representative of the area's median sentiment. "No" turns out for everything; "yes" rarely does.
I spend a lot of time in online arguments with opponents, on the theory that I'm not really writing to the person I'm arguing with but rather to everyone quietly reading comments. But it's almost certainly the case that the only conversations that have really mattered have been with electeds themselves.
> The same thing is very true of public meetings; the turnout for comment at those things is almost never representative of the area's median sentiment. "No" turns out for everything; "yes" rarely does.
That’s the exact opposite of the experience I’ve had in my town.
It seems that money is the primary driver of turnout at town council meetings. I live at the top of a mountain with 1 real road and 2 smaller frequently closed roads down to the city below. Developers really want to build up here, but there’s no way to widen the road, and no realistic way to build more. There’s not enough flat land to build enough jobs, shopping, dining etc… up here, so increasing density just means more cars making the trip 30 minutes into the city.
Every single time there’s an issue about development, you get dozens of real estate agents, developers, and people who work in construction showing up because their bank account depends on it. Every local election, you have candidates bankrolled by out of town developers.
“No” is much less well organized and will only occasionally turn out in larger numbers than “Yes” despite dominating in elections.
People say the same things here, where I know them not to be true, but I don’t know anything about your municipality. I know what the social science says about this, and the common sense intuition that never occurs to people to turn out in favor of apartments they’re not going to live in, but does occur to people who want to stop it. Your mileage obviously varies.
cost per unit actually goes up as buildings get larger, so it really depends on the market. i don’t really know any developers who actively oppose upzoning in my region, but the SFH builders I think have an easier and more lucrative job than the ones doing urban infill.
> cost per unit actually goes up as buildings get larger
Construction cost per unit goes up a little, but land cost per unit goes down a lot, because you buy the same plot of land and put N times more units on it.
> and the common sense intuition that never occurs to people to turn out in favor of apartments they’re not going to live in
That ignores all the people who have other incentives to build.
Depending on the area you probably have about 10% of the people who have jobs that directly benefit from new construction (construction workers, plumbers, electricians etc…) or who are married to people who do. Then you have all the people who work or own businesses in sectors that indirectly benefit from new construction or directly benefit from increased density.
In my town of 8k people, I’ve seen 30 people from those groups show up
in support of a new sub division vs half a dozen against.
I haven't read anything about Georgism that would specifically argue for or against single-family zoning. I own a single-family house, I already pay high property taxes, and I pay high income taxes. I think it would be more fair to me and everyone else to drop both, and tax the land my house is on, even if that came out to the same amount of tax I paid per year. If that tax was used to provide a UBI to people who don't own land, great. And I'm fairly conservative. I don't think this aligns as a modern progressive or conservative issue.
That all being said, I find expropriation to be loathsome, and I think the movement to destroy single-family zoned neighborhoods is a species of evil that borders on satanic.
> That all being said, I find expropriation to be loathsome, and I think the movement to destroy single-family zoned neighborhoods is a species of evil that borders on satanic.
Isn't restricting what people can lawfully do with their own land a form of expropriation?
> Isn't restricting what people can lawfully do with their own land a form of expropriation?
Imagine you own land subject to a restrictive covenant. The restrictive covenant might actually have positive value to you – if the entire neighbourhood has a restrictive covenant prohibiting certain land uses, that gives your neighbourhood a character, people are willing to pay for the character the covenant enforces – maybe the existence of the covenant was actually a factor in convincing you to purchase this specific property. Suppose a legislative change invalidates the covenant – that's the government taking away from your land something you value about it. Isn't that an expropriation?
And I don't think there is a fundamental logical difference between a restrictive covenant on the title, and zoning as a government-imposed land use regulation. Some buyers choose a property because of its zoning, its zoning is something they know about and value; if the government changes the zoning, and that takes away from their property something they valued about it, isn't that an expropriation?
Note, I'm not arguing that removal of zoning and restrictive covenants is always wrong – maybe sometimes it is the right thing to do, all things considered. I'm simply arguing against the position "land use limitation = expropriation, removal of it = not expropriation" – even if something is expropriation, sometimes expropriation is justifiable
I mean, I personally loathe the concept of HOAs so the government abolishing them sounds like a wonderful thing to me.
And if you just buy a property and don't actually make this agreement, I definitely don't see a problem with abolishing it. We're talking about the government telling you what you can do with your land, and then stopping doing that.
Real property is a bundle of rights in land and its fixtures – that's the standard definition in academic legal theory
If there was already a zoning or restrictive covenant, and you knew about that when you bought the land – then the ability to do with the land what that zoning or covenant prohibits is not part of the rights to the land you acquired, and the enforcement of that zoning/covenant isn't denying you any of the rights you paid for.
Besides that, private property is (almost always) a creation of the government. [0] I own a house. If I trace the chain of land titles, it ultimately ends in a government land grant; the government got it by stealing it from the Indigenous people. The government land grant was issued on the condition of obeying the government's laws as in force from time-to-time. You can't sell what you don't own; the original land grant recipient didn't own the land independent of that condition, so none of the subsequent purchasers could either. So the government restricting my ability to use the land I purchased isn't an infringement of any of the rights I actually paid for.
[0] I live in Australia; under Australian law, "native title" is considered to pre-exist Australia's current British-imposed system of governance, but all other land titles derive their legal existence from being created by that system; I don't think the situation in the US is fundamentally different, all non-Indigenous US land titles derive from action of the state or federal governments, or the colonial governments, or the Mexican or Spanish or French or Dutch or Russian or Hawaiian governments
Remember that there are plenty of houses today in America which were bought under the explicit promise that their neighbors would always be white people. That got taken away. Why should the promise of single family housing be any more precious?
Uh, no, that's not the case at this point in time. There were racist HOA compacts like that up to the Fair Housing Act of 1968. Pretty few people alive today have bought houses where they were given an "explicit promise that their neighbors would always be white people" as you said.
I live ten blocks from a neighborhood in Portland called Laurelhurst. Laurelhurst sits on a hill, about 30 blocks east of downtown, and contains the largest 100-year-old mansions east of the river. At each main entrance to Laurelhurst, there are massive stone archways. The arches were built to define the points where Black people were not allowed to enter after sundown.
This is not the case today.
Speaking as someone whose Dad grew up in segregated Baltimore, my grandfather was a bar owner who wasn't even allowed to own or work at a bar in the white neighborhoods. They couldn't rent or buy a house in the white neighborhoods.
The situation today has nothing in common with that. We own homes and businesses wherever we want to. Fold up your manufactured guilt and sympathy and take it elsewhere, we didn't need your help and we still don't.
The more fair reading of the parent comment is that some people bought homes prior to 1968 with racial covenants attached that were subsequently made illegal. Those homes built in that regime still exist. So we have precedent within the lifetime of the _homes_ for this sort of change.
Also just as an interesting historical oddity, here is a map of home deeds in Chicago that still have (obviously illegal and unenforceable) racial covenants. Including tons in the Washington park neighborhood made famous by Raisin in the Sun!
Within my lifetime, the municipality in which I live enacted policies (historic preservation and racial steering of apartments) specifically to limit the number of Black families that moved in. The preservation-based restrictionism continued into the 1980s (and, of course, remains in force today); the steering into the late 1990s. Our Fair Housing Ordinance included an escape clause allowing our board to resegregate specific blocks, and just a year or two before I was born, they used it.
> Remember that there are plenty of houses today in America which were bought under the explicit promise that their neighbors would always be white people. That got taken away. Why should the promise of single family housing be any more precious?
I'm not saying I oppose abolishing either racially restrictive covenants or single family zoning. On the contrary, I support the abolition of the former, and am open-minded about the abolition of the latter.
What I'm opposing is particular arguments to those conclusions – what one might call libertarian(-adjacent) arguments – not the conclusions themselves.
I think, a legal right to racially homogenous neighbours is a property right, and taking it away was an expropriation of property – but an expropriation I support. And I don't think one is always owed compensation for such expropriations either. Legally speaking, not all "regulatory takings" are entitled to compensation; and I'm unconvinced the answer is different if we look at that question through a moral lens rather than a legal one.
Was it ever an explicitly legal right, or just one that hadn't been explicitly illegal? I don't know offhand if there was any prior legal ruling that this sort of thing was legal or if it was just something that in practice the government never did anything about before 1968. I feel like there's a difference between a legal status quo and a legal right, and it's not clear to me that this was ever a right (although maybe you're aware of a specific case or something I'm not)
The US Supreme Court upheld racially restrictive covenants in the 1926 case Corrigan v. Buckley; they then overturned that decision in the 1948 case Shelley v. Kraemer.
So, between 1926 and 1948, there was a US Supreme Court case upholding racially restrictive covenants. There were also many state court cases reaching the same conclusion. So yes, the US courts had reviewed them and found them to be legally binding.
Furthermore, although from 1948 onwards they were officially legally unenforceable, it didn't stop new such covenants being made, which served as a social signal that non-white residents weren't welcome; the 1968 Fair Housing Act made it illegal to create such a covenant, as opposed to them merely being unenforceable in the courts.
I guess I shouldn't be surprised that for any given form of racial discrimination, there was some point in US history where a court directly ruled that it was legal.
> Furthermore, although from 1948 onwards they were officially legally unenforceable, it didn't stop new such covenants being made, which served as a social signal that non-white residents weren't welcome; the 1968 Fair Housing Act made it illegal to create such a covenant, as opposed to them merely being unenforceable in the courts.
Yeah, this is more what I was wondering about in my comment above. You had mentioned the idea of a "legal right to racially homogenous neighbours", and I was curious if that was actually an explicit legal right at any point rather than just something that in practice people did without getting into trouble. It sounds like there were a couple decades where it was explicitly a legal right, and then another couple decades after where it was in the "implicitly allowed despite not being considered legal" territory (and presumably for an indefinite period beforehand was also basically allowed, just without the definitive legal ruling on it).
To clarify, I didn't expect that you were wrong by using that phrasing earlier; I just had no clue either way, and it seemed like it might be useful context for the discussion either way.
I think racially restrictive covenants were originally legal basically everywhere; but only in the US, Canada and South Africa did they become common.
Under English real estate law, while there are some constraints on your ability to make covenants, the rules are quite broad. A century ago, racial discrimination wasn't illegal or clearly contrary to public policy in most common law jurisdictions – indeed, many of them had explicitly racially discriminatory laws on the statute book – so racially restrictive covenants weren't obviously disallowed. The US, with its constitutional prohibition on discrimination in the 14th Amendment, was actually the only common law country in which there was a decent argument they weren't legal – but SCOTUS rejected that argument at first, then changed its mind over 20 years later. In the 1945 case Re Drummond Wren, the Ontario High Court ruled them illegal – but it cited the just signed United Nations Charter as grounds for doing so.
I agree. And really the Supreme Court ruling that racial zoning couldn’t be enforced and was an unlawful property taking is an even more direct analogy.
I think you’re missing the point. It’s not you gaining more freedom with the land that’s the problem. It’s that all your neighbors now have the same freedom.
I bought my house with a close neighbor because I know the neighbor can’t build a steel mill in their backyard. If the government comes in and says we’re all free now to build steel mills, that gain in freedom is a loss in value for me.
No, that’s not expropriation. There’s a really important difference between a restrictive covenant on the title and a zoning regulation. The former is part of what you bought. The latter is something that happened to exist, and nothing about your purchase carried any sort of promise, express or implied, that this would continue forever.
It’s no different from buying a house with a great tree in the neighbor’s yard, and then they cut it down. Was that part of the value of the house to you? Yep. Was there a promise that it would stay there forever? Nope. Is cutting it down expropriation? Nope. Should you have assumed it would be there forever? Absolutely not.
Like, that's a clever response, but it's not describing expropriation, and you know that. Expropriation literally means taking away property, so it's not a matter of degree: It's saying we are taking your property and redistributing it.
Here's where Georgism gets clever: The initial Georgism says that land should be taxed up to the value of its land-rent. Some progressive people said, well, that means the landlord wouldn't make any money anyway, so the government should just take (expropriate) the land. George said, basically, no. Let the landlord decide if it's worth it for them to keep the freehold.
Then, there are varieties of Georgism that disagree about whether the government should be allowed to tell you anything at all about what to do with your property. Some say you should be able to do anything on it. Others say not.
When I bought my house, across from an elementary school, I knew I didn't have a right to drill oil on it, or to build a factory making solid rocket boosters and dumping perchlorates in the basement.
That's all written into the code governing the land before you buy it. The Georgist question is: If I'm paying 100% tax on this land's rent value, does that mean I get to despoil it any way I want? Or do some rules apply?
That's a separate and more nuanced question; the answer is probably that the same rules would apply as do now, but that doesn't equate with expropriation.
So IIUC your argument is that what do you do as a landholder when actually land development is forbidden/restricted because the absence of certain developments actually what provide the value ?
I have no idea what georgists would say about that. My guess is that being a the holder of such land would work as luxury/status-signal because you are only incurring the cost of the land and no/low revenues from it
It really doesn't have much to do with planning or zoning, I imagine it predates that. A lot YIMBYs are also georists but a LVT wouldn't really address issues created by planning.
Zoning and planning distorts land values so georgism alone won't solve land use problems. E.g. Demand for land with fewer property rights (such as single family zoning, or a heritage restriction) will be lower than the site next to it that allowed building a 200 floor residential tower. In turn its land value will be lower.
It might still yield a high rent tho, but maybe not more than a new well maintained apartment.
> A lot YIMBYs are also georists but a LVT wouldn't really address issues created by planning.
It wouldn't directly address those planning issues, but it aligns the financial incentives of the body politic between residential homeowners and the rest of the community. Normally residential homeowners have huge financial incentive to make housing scare and expensive, the LVT removes that financial gain from causing misery.
LVT is a good reform to do, but if the goal is to improve housing affordability through supply it's quite an indirect measure and occur at a glacial pace without proper planning reform.
Many areas where people want to live and where homes should be built, can sometimes have a large portion of home owners like Mosman, Bondi, Croydon or Woollahra in Sydney. A tax on the unimproved value of land just doesn't get home building started here if no one is a renter (I recall increases in rent were tied to LVT in Progress and Poverty). And if its based on valuations the valuations will again be distorted by planning controls.
If you upzone these areas for towers, the moment the first person takes the gazillion dollar offer from a developer suddenly homes get built, and suddenly everyone else want to exit. And besides if you have LV Tax their land value will got up because their land will have fewer development limitations, higher demand, etc, etc.
Georgism is cool, land tax is cool, but it's not a silver bullet.
If your goal is to make homes more affordable, reforms like the ones they did in Auckland (loosening planning controls) is the way to go. https://onefinaleffort.com/auckland
If your goal is to redistribute wealth Georgism is not a bad option, but again planning controls (zoning, Floor space, height limits, heritage controls, parking minimums, upper setbacks, excessive lower setbacks) can suppress the true size of the tax base.
the movement against SFH zoning is not about destroying single family zoned neighborhoods, it’s about not forcing every lot to require a SFH. i’m not sure how your comment on expropriation was meant to read, but SFH zoning itself is more of a taking. people who want to live in a single-family-only neighborhood should find a spot on the edge of town where development pressure is low, not weaponize land use regulations to make it illegal to build what the market wants near jobs and amenities.
and while an LVT doesn’t really care about zoning, depending on how close to a city center your SFH is, a well calibrated LVT might dramatically increase your overall tax burden even if you dropped all other taxes. SFH zoning is manufactured scarcity; LVT prices scarcity correctly, and there’s no upper bound on that value, especially since land taxes become divorced from income.
>> i’m not sure how your comment on expropriation was meant to read
I should have clarified that. I meant it in the context of Georgism. The concept of Georgism was manifestly against the government actually redistributing owned land; instead, landlords would divest themselves of the land if the only utility they got from it was rent. What Georgism says you're paying for when you pay LVT on the land you own is the exclusive right to private use of that land, which comes at the expense of everyone else who doesn't "own" (or essentially, lease) the right to live on it or build on it.
Georgism distinguished between ownership by individuals for productive use and ownership by either (a) individuals for rent-seeking or (b) governments for redistribution.
You may be right about LVT pricing scarcity where I live higher than my current tax basis, but even that would make sense since I earn a lot and pay inordinate income tax to have the ability to live in a single family home near to a city center. But there is a funny corrolary to that which Georgism seems to intuitively grasp and which is orthogonal to the argument between manufactured scarcity. (And maybe this is a gap in Georgism's argument):
I live in inner southeast Portland, Oregon. Along all our east-west avenues there are tons of Amazon boxes (what we call studio / one bedroom 4 story cheaply constructed wooden apartments with a patina of modern amenity). And tons of local businesses. Between the major streets it's almost all single family homes. This makes it one of the last cities in America where you can live in a SFH within walking distance of everything, including downtown. Street parking is still free here, and a lot of people don't need a car at all. I live in an SFH within two blocks of apartments where the waiters and bartenders live who works at the restaurants on the avenue. It's truly mixed use. However, they've now rewritten the zoning law to allow tearing down houses as small as mine (1200 sqft) and replacing them with 4-plexes. The problem with the Amazon boxes is that they don't provide room for families. No one is building 3 bedroom apartments where you can raise your kids in the city.
Which gets to the heart of the matter, which is that a major reason that this city and this area are so desirable is precisely because those SFHs exist between all the major streets. The usefulness of not needing a car and being able to have a family in the city center is widely overlooked by people campaigning to eliminate SFH zoning, but without it you end up with neighborhoods where everyone is under 30 and relatively transient, without much money to spend locally. The apartments decay, and most of the work reasons for living there disappear.
Eliminating SFH zoning is an opinionated form of redistribution that preferences a certain age group and a certain socioenconomic position over others. It reduces actual diversity, and produces monocultural places like Seattle and Santa Monica where only the very rich can raise a family in town, and everyone else is a young renter.
i appreciate the thoughtful response, and the fact that it’s rooted in a desire to maintain some element of diversity.
i’d play your observation back at you though: there’s more than just young renters and nuclear families in terms of household typologies, and nearly all of the other ones (childless couples, empty nesters, older singles aging in place) would also benefit from ownership (or “rooted”) housing opportunities that things like a quad would provide in these neighborhoods. household size across the US has been shrinking for decades, and there is truly a lot of demand for smaller homes at all stages of life. instead of looking at the quadplex in the SFH neighborhood as a way for “young renters” to displace families out of the neighborhood, it’s an opportunity for other households to take root or make a life transition without having to leave.
if quads in SFH neighborhoods are just being overrun with young transient renters, it probably means there’s not enough “amazon boxes”, and may be related to broken zoning at the upper end of the spectrum.
also, this is all without saying… it is entirely possible for children to be raised in a home that is not a detached SFH! it is certainly a preference for a lot of people, but it is not a hard requirement. and missing middle buildings like the 2/4/6 plexes are some of the best non-SFH buildings for doing that, where you can more easily have 2-3 bedrooms and some sense of a yard.
I think we largely agree on the fact that SFHs should not be the only option for young families or empty nesters or aging couples. (As an aside, all of the above live in SFHs on my block, as well as young single renters in their 20s who share SFHs as roommates). I brought up Baltimore rowhouses for that reason. My Mom grew up in a duplex in LA with a backyard... my brother is raising his own kids in almost an exact copy of that duplex.
I'm not sure what you mean about the lack of new construction of that type coming from broken zoning at the upper end of the spectrum. Maybe uou could elaborate. The upper end of the spectrum in Portland is... almost everyone with money moves to either the oldest exclusive homes in one of two very non-diverse neighborhoods (Laurelhurst or the West Hills), or else they move to the exurbs and build McMansions out in the farmland. Neither is really actively engaged in a community beyond a homeowner's association, and neither is walkable or a place where people of different economic and cultural backgrounds get to interact for everyone's benefit.
So maybe what I'm trying to say is that the high upper end (homes over $1M, let's say), is going to remove itself anyway, and that yes there should be more construction of 2-4-plexes which are not Amazon boxes... but there seems to be no incentive to build those things, and I don't even know how you could do so on a 1200 sqft lot.
In the interim, Portland has eased lots of rules on the use of ADUs and trailers in backyards and even yurts. I bought my home for $450k and the range in the area goes up to $800. This tells you that what I'm arguing for is a working middle class that should have access to living in the city with a modest back yard.
But I do feel like the crusade against SFHs has a distinctly classist, anti-middle-class, anti-family quality to it... and what I mean to say is that it is the working middle class families in the upper end of housing on those avenues who anchor those blocks and keep the neighborhoods livable and loved and who keep the businesses in business. I've seen what's happened to such inner city SFH neighborhoods in Los Angeles, and it turns into somewhere that no one would want to live if they didn't have to, with no community or neighborhood to speak of. Row houses and shared brownstones in East Coast cities have fared slightly better as an attractive living pattern.
Ultimately too, your argument is that not everyone should live where they live, because more people want to live in that spot, so if they want space they should move to the suburbs. My argument is that not everyone can afford to live exactly where they want, either way, but that doesn't logically imply that you should increase density as much as possible in a mixed and vibrant neighborhood just because people want to live there. At a certain point it will lose the very thing that makes people want to live there in the first place. Not even to get into the fact that no one actually works downtown anymore or commutes away from the neighborhood, so this is purely a choice for most people.
You still didn't address my point that every SFH torn down for a 4-plex just redistributes individual middle class ownership to financial corporations.
Many places have all of the single-family homes also owned by corporations. I think your problem here is increasing financialization of the economy rather than anything to do with zoning.
> what I'm arguing for is a working middle class that should have access to living in the city with a modest back yard
If housing has gotten so expensive that the "working middle class" has to live somewhere else and commute in, the way to attack that is to increase the stock of available housing, not continue to sharply restrict it.
> crusade against SFHs has a distinctly classist, anti-middle-class
To the contrary, relaxing zoning requirements most strongly benefits people who are less wealthy and currently end up overspending on housing or getting priced out.
I think this all depends on what time and place you're living in.
I'm definitely living in a very weird bubble in eastern Portland. It was a working-class, blue collar town of single-family homes. It was colonized in two separate waves, in the 90s and in the 2020s, by people who couldn't afford rents or homes in city areas of San Francisco or Seattle. But it never really took off economically as an international city, and it's still stagnant, and much more reminiscent of Seattle in the 1980s.
There's a lot to like about that pattern, and under Georgism it would make lots of sense for people to move here because the land value close to downtown isn't really that great. Or to move to Cincinnati, or Lexington, or Des Moines. If all people had to pay was fair rent on the land, new local communities and diverse downtown areas would be springing up all over America.
Not everywhere that people rush into and want to live because it was shown on the Real World needs to instantly resemble the same monocultural sort of housing that a big city like Los Angeles or Seattle has had to adopt.
Moreover, there's nothing inherently immoral about retaining the shape of a city when more people move into it; presumably, they are moving there because they like the city.
When I see working people being priced out of Seattle or LA, they're being priced out by financial groups and offshore investors, with the help of local boards that allow homes to be torn down and replaced with half-empty investment apartment blocks... destroying the very thing they're investing in.
We may be clinging on as homeowners and holding to a way of life that is incompatible with the kind of colonization other cities experienced, but: We take care of our parks. We know each other. I can't go 4, or 8 or 12 blocks that I don't see people I know. Up in the Amazon boxes, we meet the people who come for a year and go.
What equity is there for us in the plan to remove single family zoning? Not even as a parable:
10 miles west of Portland, Intel built a giant facility, and there is a commuter train stop out there which has Amazon boxes for miles around it. But no SFHs in their new construction, nor anything that would be attractive to anyone over the age of 29.
Why should I move out there and they move here, when in reality, that wouldn't even exist without the ancient core of SFHs that defines the character of the city they ostensibly want to live in?
The problem I have with your line of thinking is that it basically seems like the main reason you like your SFH neighborhood is that it's right next to one that's not SFH; if you were surrounded by multiple layers of SFH, you'd lose the ability to have the nearby businesses staffed people you're describing as not living in that type of zoning. It's not clear that the non-SFH home neighborhood with all of the businesses near you gets anywhere close to as much benefit from the proximity to your neighborhood (the closest thing to this I can find is that you mention you have well-maintained parks, but it's not clear why you think that this couldn't exist in a large cluster of non-SFH neighborhoods as well; I've lived within a few blocks of very large, well-maintained parks in separate neighborhoods where there were no SFH neighborhoods anywhere close by).
Combined with some kind of odd ways is describing things (cities being "colonized" in recent decades, people moving to LA because it was on The Real World, as if there hasn't been close to a century of tropes of people moving to Hollywood to pursue show business, implication that eliminating SFH zoning requires you to "move out" when it certainly does not require any individual homeowners to do anything different than what they're already doing), it's hard not to get the impression that you're basically trying to argue in favor of NIMBY without actually saying it.
An aside - I was talking about the wave of mostly white, young, single, affluent people colonizing and gentrifying Portland, not LA. The Amazon boxes are a form of gentrification that push out existing homeowners. Portland's historically Black neighborhood of Albina was a thriving mix of SFHs and medium density. Now those houses are torn down and it's a wall of condos and apartments that all look the same, each with a sushi restaurant or an organic market.
You're right, it is that there is denser zoning in close proximity that makes us want to live where we do, and makes it walkable. Which contradicts the idea that I'm making a NIMBY argument. I don't want to live in an all-SFH suburb or in a high density zone that's all rentals. I also don't want to live in the only SFH surrounded by condos. I think your point is that the SFHs don't contribute anything to the mixture, and are somehow parasitic on the higher density zones. I think that's not true. Both sides of the mix are important. It gives the neighborhood a character that doesn't exist in most American cities, which is: People of different backgrounds sit together outside cafes and talk. On any given day we hang out with other homeowners, their kids, young professionals, and also people who work in the service industry who live in the neighborhood and go to the same places they work on their days off. We go to concerts with them, they come over when we BBQ and hang out at our house.
My argument is that this arrangement is much better for society as a whole, and for individuals across the socioeconomic spectrum, than a division between all-SFH suburbia and all high-density inner city. Especially now that most people don't commute to an office, and most of the commuting is done by wage workers who have to commute out to the suburbs to work in a strip mall. The homeowners close to downtown provide an economic base for higher-end local businesses that renters would not be able to support. The people who work in those businesses earn enough to rent in the neighborhood where they work. With all high-density, families are essentially exiled to the burbs, there is little to no socializing between economic classes, and everyone has to commute.
Sure, re-zoning doesn't affect individual homeowners immediately, but the endpoint or goal of it is to ultimately get rid of SFHs in inner areas, not to leave a healthy mixture standing. That's what I see as the problem. And I think it's a politically motivated goal based on the idea that no one should really own a SFH (or if they do, as one poster put it, they can move somewhere far away from the city).
I've lived or spent significant time in a bunch of places around the US - rural NJ, suburban NJ, NYC, Philly, Orlando exurbs, San Diego, San Francisco, South Bay, and I now live in inner SE Portland. And I agree with you that there is something really special about it.
In some ways it's similar to the tourism or gentrification problem - the very things that make a place desirable lead to the destruction of those things. Some people view the world through a purely economic lens and treat individual people as abstracted production/consumption units. And unfortunately there's no real way to put a dollar value on "all the neighbors know each other and help each other out". And even if you could - you can't just BUY your way into that, no matter how much money you have! The only way to unlock that value is to live there and engage with the community. Obviously there will be turnover but what some people don't seem to grasp is that there is a tipping point, where enough newcomers overwhelm the "old timers" and destroy the culture of a place. And think about the game theory of it from the point of view of a resident - why invest time and resources in a community if you're just going to leave in a year or two? Or if the beneficiaries are future random people who are not going to give a shit about the community?
Nice to hear from a fellow Portlander who feels the same way! And your explanation is clearer than what I tried to describe as "character". There are a lot of people here of course who do just view residents as economic units, but there's just as much resistance.
"you can't just buy your way into that" is a great insight.
> Which contradicts the idea that I'm making a NIMBY argument. I don't want to live in an all-SFH suburb or in a high density zone that's all rentals.
I don't understand what you're trying to say here at all. If you're trying to argue against some sort of development or planning change that doesn't change anything about your own property due for reasons that are purely about how it would affect you personally, that seems like NIMBY to me. The fact that you happen to not be arguing for universal SFH doesn't somehow make it not NIMBY.
Independent of that, I don't really find the rest of what you're saying compelling. You're arguing against a change to eliminate something with concrete, known problems on the basis of wanting to preserve "character". I still maintain that this is indistinguishable from any NIMBY argument.
This comment makes me wonder: is the actual issue perhaps not so much SFH but family housing?
I can imagine a sensible zoning rule requiring an appropriate fraction of housing units to have 2+ bedrooms and another fraction to have 3+. (There is no particular reason that a multi bedroom unit needs to house a family. Plenty of 20-somethings are happy to have housemates.)
Due in part to suboptimal fire codes, the US has trouble building nice multi-unit buildings with 2+-bedroom units, but other countries manage just fine.
What is the median price of one of these SFH in this neighborhood? I doubt very much that "middle class people who are willing to buy a house where they don't need a car and want to raise their family in the city center" is an accurate assessment here. This is a housing policy that allows the most valuable land for high density housing to be monopolized by a small cohort of rich people who have enough money to afford both the convenience of proximity to downtown and also the luxury of a whole house + yard to themselves, probably making up less than 1% of the metro area population.
That's really not the case. Which is why I'm saying that inner SE and NE Portland are very unique in their walkability, zoning pattern and the resulting social effects for an American city.
Prices have risen in the past 10 years, but the median SFH in Portland sits at around $550k. 54% of the housing stock in Portland is SFH.[0]
The 1% don't live in the city, they live in Lake Oswego and other suburbs where the average SFHs are twice as large (at least).
Nobody is expropriating your land by upzoning it, they're giving you and all of your neighbours stronger property rights through the freedom to develop your land.
Denser developments are also much more fiscally productive than SFH zoning [1]. This means that cities that upzone will tend to have lower taxes, less debt, and better services in the long run.
I think UBI is pretty squarely a progressive issue. Maybe you're conservative for the area you live in (Cali?) but many conservatives would consider your view to be pretty extreme left.
> you’re much better off finding and working with people who are already interested in your principles
after five years in the trenches of local housing/urban policy in my city, this is my biggest takeaway. i don’t think i’ve ever even once changed someone’s mind who was a staunch NIMBY, even with a reputation as one of the most accessible and persuasive local policy advocates/writers. but I have been able to build coalitions of hundreds of people by finding people who were already mostly with me, and just shifting them from inactive->active.
there’s also a lot of power in the energy of building for the future. when we passed our big SFH elimination ordinance two years ago, we had a packed city council meeting that, numerically, had 50/50 of residents speaking for/against. but for the city council, watching a parade of retirees 65+ come up and say the same thing over and over again (“i’m not sure this is right for our city”) vs an equal sized but diverse group of people of all ages and life stages speak about all of their different housing needs and dreams for the future, the weight in the room was overwhelmingly in favor; the new zoning passed unanimously.
> watching a parade of retirees 65+ come up and say the same thing over and over again (“i’m not sure this is right for our city”) vs an equal sized but diverse group of people of all ages and life stages speak about all of their different housing needs and dreams for the future, the weight in the room was overwhelmingly in favor; the new zoning passed unanimously
"Yes you worked your whole life for that house that you carefully chose and maintained, but we want to send its value through the floor because we're more powerful".
Show me someplace a change in zoning from R1 to Rx sent values through the floor.
Around here (Metro DC), that simply hasn't happened. There's so much pent up demand for housing that at worst, the appreciation has slowed, but I'm not even convinced that's happened, as the infill/redeveloped land is actually being used and generating economic activity (vs parking lots or old flats and offices nobody wanted).
Also, you didn't reply to what I wrote, which is that it's funny that you were trying to convince us that land value appreciation is a return to labor. I'm guessing you ditched that because it's obvious how silly it is.
Upzoning a neighborhood typically increases the value of the land, so that straw -man owner would benefit from it when/if they decide to sell their place.
I don't know how you can say it's a straw-man argument when you qualify the the statement as "typically" increases the value of the land... that indicates you KNOW at least occasionally it doesn't increase and instead decreases, and if it's a real possibility (even if the % is low - 10-15%) then it's not a straw-man argument to be concerned about it, it becomes something that should be risk weighted and explained to mitigate the concern.
Why should someone who is almost dead care about the current and future value of their house? Why should someone who is almost dead care about what their neighborhood looks like after they're gone? There some sort of mental illness where these people think they're going to live forever.
> Why should someone who is almost dead care about what their neighborhood looks like after they're gone?
It might be unfamiliar, but people care about their neighbours and family, and passing on a good place to others to raise their families there in future.
The problem with having everyone rely on gains from home appreciation is that it doesn’t continue to work over time.
Yesterday’s home appreciation is today’s price increase for new home buyers. In most places in the US, home prices have far outpaced inflation for several decades now.
It seems silly to even be arguing about whether or not it’s deserved when we already know that it’s not remotely sustainable.
Yeah I think one of the vestiges of the "liberal consensus" era of politics (pre 2016) was that "persuasion" was seen as the only valid way to advance your advocacy. But the shattering of that consensus has allowed the left of center to realize that, in fact, winning is what matters. Your biggest ideological opponents by definition cannot be persuaded- politics is now a tightly coupled to the ego and therefore someone attempting to change your beliefs is deeply threatening.
The right learned this a long time ago. Persuasion does not matter. Our system is winner take all. Winning is all that matters. Online debate is a waste of time. Find your base and activate them instead.
(author here) Another thing I've noticed is that you never know how or what will happen until you try. I was following legislation in one state and learned that literally dozens of people from all kinds of organized opposition came out to testify against a proposed bill and it quickly died in committee, exactly the kind of brutal pushback that demoralizes people against trying. Then, Jackson Arnold's experience in Kentucky was almost the exact opposite. He approached a local government official, who got excited about it but needed a state enabling law. The official in turn got in touch with a state republican, who basically went "seems fine," and inserted it into a giant omni bill, and it sailed through the legislature. Now they're working on local implementation.
How dare these wretched poors fight to protect the single most important financial asset in their life: their home. Those NIMBY backwards cretins! Those swine! How dare they not embrace the sweet delights of the 5 over 1 luxury condo with an HVAC that sounds like a tornado and walls so then you learn every single neighbor's dog on your entire floor by bark. Of course I, the noble YIMBY patrician who knows what's best, will continue to live in the $1.2M home my parents purchased for me and my wife in the walkable part of town near the hustle and bustle of the city's best breweries and axe throwing salons!
Doesn't matter if you increase the housing supply but replace the demand with one of a higher real estate tier. "Oh no all these $300k houses were knocked down to make $800k condos. But on the bright side consider how much higher the supply will be!"
Are you sure this isn't just 'turnout inertia' working in your favor? People who are relatively content with the zoning rules are probably not actively engaged on the issue. But swap them in a way that they become unhappy with (as you presumably were) and you see sharply increased turnout in the opposite direction.
Put another way, one of the historical critiques of democracy was that it ends up catering to interest groups whose interest may not align with the rest of society. At first that seems paradoxical, because a more knee-jerk critique would expect democracy to just turn into a tyranny of the majority. But the reality is that people generally don't act on things until they are sufficiently incentivized to do so. And that incentivization is often reactive in nature.
Yes, representative democracy as a system is biased more towards preventing bad outcomes (i.e. allowing the people to remove leaders that harm their interests) rather than pursuing the pareto frontier
as someone who reads a lot but doesn't comment much you've got the topshelf content here consistently, its so obvious when someone has a clue or doesn't if you're in the same areas, very easy to fool others with confident assertions (cough airline issues on HN) but for someone in the industry it's not at all
funnily enough this comment about zoning which isn't your or my field but get the feeling it's on point, is such a massive problem in the western world which has built up over decades, lets just copy someone elses homework in my opinion, Asia gets this stuff right: https://devonzuegel.com/north-american-vs-japanese-zoning
It strikes me that there is something slightly ironic to this point that he's making. It actually is useful for him to persuade the "overly online keyboard warriors" who frequent his writing that they should be focusing on local influence. It seems to me that the real lesson is that if you have a big audience, it is most useful to persuade that audience, but if you don't, it's most useful to work to influence specific people in the right positions.
Just dropping by to say that you're doing gods work advocating for more housing. Its exhausting seeing amount of cynicism around how the status quo just can't be changed for this or that reason, but seeing the small, incremental, advocacy over decades pro housing groups put in is really inspiring. An incredible amount of progress has been made here
My business partners will chuffed when the vote happens in October or November, whichever way it goes, because this has been siphoning a huge amount of my attention over the last year.
I guess here's an issue. I bought 13 acres - mostly because I hate hearing basketballs bouncing, other people's TVs, and "boom cars".
So if we're going to start taxing me at a million per year, can I start taxing those loud people a million a year so I can live in the city to pay for medical bills for my brain to go through the bouncing basketball.
Mind you, everyone else in my area has 10 - 15 acres and it's just a dead area. Just people that ran away from the city. There's absolutely no "value" in this land as no one wants to even be here and drive 40 minutes to get to a grocery store.
One of the main points made in TFA is it's important to communicate that single-family homes outside of city centers will tend to see lower taxes if you go from property tax to LVT, because in the city most of the value in your home is the land, but that ratio flips the further you get from the city center.
Obviously this assumes a single tax-base; if you are not in the same tax base of the city, then you're probably still fine, since if everybody has similarly valued lots, the taxes will be shared similarly between them.
The LVT seems to me to be a lot like a carbon tax: a wonderful technocratic idea that is politically untenable. LTV would be great for humanity, but very bad for present homeowners. Since homeowners are wealthy and thus more politically engaged on average, I just don’t see how this could ever get passed. Instead of starting with an impossible task, why not start instead with a merely incredibly unlikely task: repeal proposition 13.
I think that GPs point still stands if you replace homeowners with the sort of organization that own en-masse the sort of empty lots that would lose out.
What is the purpose of a tax? LVT might be be perfect for some applications. Or not. Until you define what you want a tax to achieve arguing about what's best is ill-defined.
There's a lot here to absorb, but one thing I've always wondered about Georgism and Land Value Tax is whether land supply is actually inelastic:
> Land, however, is not built. Land is inelastic in supply, and landowners don’t “provide” land the way laborers provide labor and investors provide capital; they un-provide land by excluding others from using it. Building supply can change in response to a tax change, but land supply cannot.
But many cities actually can increase their land supply via land reclamation. This can be done by filling in waterways or otherwise altering the landscape to make it suitable to build on. Chicago, for example, built the Adler Planetarium by filling in rubble along the shore of Lake Michigan. Boston is an even more impressive example; Back Bay used to be a bay of the Atlantic Ocean, not an entire neighborhood of a city with very high cost of living.
Cities can also lose land. Sometimes this is due to natural causes like erosion, sea level rise, or disasters like earthquakes and volcanic eruptions. Other times a lack of regulation might permit pollution to make land unlivable or infeasible to build on. Land owners can't create natural disasters, but they can advocate for policies that strongly influence effective land supply, such as whether building codes allow building on certain kinds or soil or require resistance to earthquakes.
Does this change the calculus from a Georgist economic perspective? If not, why?
All that is true and I suppose there could be tax policies to encourage land reclamation, but this is more likely to run into environmental concerns. It’s literally an edge case.
> one thing I've always wondered about Georgism and Land Value Tax is whether land supply is actually inelastic
It isn't actually perfectly inelastic, but looking at land reclamation (and erosion!) relative to the ease with which places to live can be added to a locale, the supply of land is relatively inelastic. Even then, that kind of misses the core of George's argument about land value.
George himself distinguished land from labor and capital by looking at it through the lens of whether the economic value of a piece of land needed to be attributable entirely to improvements undertaken on that land. This is his "all natural opportunities or forces," and those are where the constraint lies.
For land reclamation in particular, there are two things to look at: (1) the value attributable to the land reclamation effort; and (2) the residual site value. (2) is land rent, and the Georgist model really is predicated on the relationship the surrounding community has with a piece of land. As it goes, if the community's feelings toward, say, a reclaimed waterfront are tepid, that reclaimed land won't have much value (even if the land reclamation were undertaken at great expense!), and won't command high land rents.
When georgists refer to land, they are referring to locations - not dirt.
Locations refer to the sections of physical 2D space that makes up a country. Why 2D when the world is 3D? Because parcels are allocated and segmented based on a 2D model.
Locations are best thought of as being similar to "spectrum" (what typically gets auctioned off every few years to the highest bidder) - there is a total fixed amount. Nobody made the physical space, and nobody will make more of it in the future. It all existed before life even began on this planet, and it will exist long after all of us are dead.
I think this is actually the problem with Georgism. The world has plenty of dirt. Locations are in short supply. Georgism taxes away the gain from the creation of Locations, which is an important economic activity. For example, most of London's suburbia was created by the building of the metropolitan railways around 100-150 years ago. Places that were too far from London to be useful suddenly became Locations, and the railway companies made back the money they spent to build the railways by selling these new Locations for home building (now known as Metroland).
Although we don't have LVT in the UK, it interesting that we have another restriction on the creation of Locations: Planning laws in the UK are extremely hard and expensive to navigate and get permission to build pretty much anything, so the creation of new Locations is pretty much impossible. And that doesn't seem to be a good thing.
> Georgism taxes away the gain from the creation of Locations
The premise of Georgism is that there is no creation of locations (at least unless you're in the business of creating planets).
> Places that were too far from London to be useful suddenly became Locations
No, those were always locations, before and after the construction of railways made them more valuable. Accordingly, Georgists ain't interested in taxing the gains of the railways themselves; we're only interested in taxing the gains of the landowners profiting off of their land suddenly being more valuable from no contribution of their own. Under LVT the railway companies still would've made their money back in droves — probably moreso if they're only paying taxes on the land under the railroads instead of the actual railroads themselves!
Land means location in this context. Filling in seabed (which are literally termed "water parcels" as a term of art) to make dry land is technically improving it. The straightforward policy recommendation is therefore to exempt reclaimed land from taxation (perfectly in line with a policy of not taxing improvements) for e.g. the first 50 or so years (well past the investment horizon) and begin taxing it as conventional land thereafter -- this comports with George's philosophy for how to handle edge cases like e.g. landscaping that start off as improvements but over a long enough time horizon eventually become regarded as part of the permanent landscape.
Alternatively, reclaimed land is usually a state initiated enterprise in most cases. In those situations, the land can simply be leased out by the state. This is literally what NYC did with Battery Park city!
But you can multpliy location by building up (there is some energy and time inefficiency in having to go up and down but in theory you can also build multiple layers of transportation), so how that works?
I see how it works but all you're doing is making more efficient use of the given parcel of land. The value of the land already prices in its development potential. A parcel that could legally, physically, and feasibly accommodate a high rise will be worth more.
Take the Netherlands as an extreme example of this; something like 17% of the country is reclaimed land. There's not many places you could do that.
Since unreclaimed "land" if it can be owned, can not generate any rents, it won't be taxed at all. But if all the additional value of making it usable were taxed away with a full LVT, it creates very little incentive to reclaim it and make it usable.
I think the best thing to do would be to exempt reclaimed land from land value tax for a period of time. Just like we grant monopolies for patents for a fixed value of time to incentivize sharing of the secrets.
If you got 50 years on reclaimed land without tax, it would heavily incentivize its creation.
> Cities can also lose land. Sometimes this is due to natural causes like erosion, sea level rise,
When there's a full LVT, the transactional sale price for land is very close to $0, because your land rents are taxed away. That leaves only the buildings as something that's lost to the natural disaster, so in many ways this might be far better for property owners.
It would also alleviate many of the challenges with relocation when necessary, from flooding, etc. Since the land is no longer the valuable part of the relationship estate, only the building must be moved/replaced.
Georgism, or the tax on the unimproved value of the land, is the fairest tax I (and many others) can imagine. It directly counters one of the ugliest part of any economy/society - rent seeking.
Suppose you see an area in upward economic trajectory, you buy a bunch of land/properties, then do fuck-all for the next 30 years while the hard work of everyone around that land causes your land's value to increase. You contribute nothing, while benefitting from others' contributions. All this while someone who could have used that land/property for a more productive used is deprived of it. Georgism directly counters that by taxing any 'base land value' that you own.
Georgism and the 'taxing progressively higher any property a person directly/indirectly owns after first N properties' are seriously very much needed around the world, economic rent-seeking steals from future generations.
>...the 'taxing progressively higher any property a person directly/indirectly owns after first N properties' are seriously very much needed...
I don't see it in the article, but the progressive nature of the tax is important. It makes it harder for large landowners to pass along the tax, since they must compete with smaller landlords. The net effect should also stabilize land appreciation, which will no longer rise with rapidly increasing wealth disparity as it has in the past couple of decades. And we won't need clunky, patchwork solutions like the ban on home ownership by private equity.
Right, it's not in the article but this is a problem I have spent disproportionate amount of time thinking so that leaked in. A lot of things that benefit the regulatory capturing class are presented as if they are good for the 'common man' and how we all won't even have homes to rent if it wasn't for generosity of landlords, such bs.
What prevents the landlord rent seekers from just charging more rent? Wont they all uniformly raise rent, because they are all uniformly having their taxes increased?
This is the argument again Georgism I have the hardest time countering.
Landlords tend to raise rent to the maximum value they can.
If they could raise rents, why haven't they already?
And if their costs go up and they can't make ends meet, they will sell the property, possibly at a loss, and the lower value will lower taxes.
But this won't happen, because the landlord's taxes won't rise. They'll almost certainly fall, as shown in the abundant data. And if for some reason the landlord's property tax does rise, it's because it's a ridiculously underused parcel in an area of really really high value, like a duplex next to 10+ story buildings. Which means it may be best to let 100-300 people use that parcel rather than ~10.
The LVT shifts tax burden away from homes and businesses and towards empty lots and parking lots.
Thanks. I like this response. I might phrase it a little more verbosely: what forces currently limit rent prices, and will any of those forces be lessened if land value is taxed?
They haven't raised rents because they are in competition with other landlords. If all landlords' costs go up (e.g. taxes) then all landlords will raise rents to maintain the same previously optimal profit margin they were extracting.
To put it another way, why not raise taxes to $1M/sq.ft.? $1B/sq.ft.? If if were true that it wouldn't be passed on to tenants then you've found the magic money tree.
Excellent point, and nobody has ever brought it up to me despite me talking this way many times! I think the "competition" angle is really good at pointing out why a land value tax is very different from a property tax here.
A property tax affects all square footage of apartments quite equally, which is very well correlated to rental prices, so a property tax is roughly equally a rise in all landlord's costs. So in the very few housing markets where rental prices have fallen to near the cost level, and there's very near zero profit in renting, property taxes could easily cause a rise in rents.
However when switching to a land value tax from the current property tax system, the incidence is quite different than a broad property tax increase. Some landlord's taxes fall quite a bit, some landlord's tax bills might increase.
> If all landlords' costs go up (e.g. taxes) then all landlords will raise rents to maintain the same previously optimal profit margin they were extracting.
And then all landlords will see a surge in vacancies, and not all landlords are able to tolerate paying LVT on empty units for very long before they're forced to drop their rents back to the actual market value.
> why not raise taxes to $1M/sq.ft.? $1B/sq.ft.?
Same reason why landlords can't raise rents to $1M/sq.ft or $1B/sq.ft: because nobody in their right mind would pay that much.
> What prevents the landlord rent seekers from just charging more rent? Wont they all uniformly raise rent, because they are all uniformly having their taxes increased?
The first effect Georgism would have is, more effective utilization of real estate. If you go to any big city, there is simultaneously a shortage of properties while a significant number of vacant properties. This would disincentivize vacant properties, so more supply (or at least more tax collected on vacant properties that the city can use for better purposes).
Also, the reason for making progressive tax larger on larger landlords means renting out a few homes is significantly more economically attractive while beyond a certain number, it is no longer viable, which pins prices down.
Government already has the prerogative to set taxes, so you should worry about that exactly to the extent that you currently worry about it. LVT is orthogonal.
Broadly, government is not called rent-seeking because it does things to justify its keep: law, defense, roads, bins, etc etc.
At least I have some influence over my local government and how it spends my tax money. Same can't be said about my landlord and how it spends my rent money.
The headlines would be more along the lines of ”Grandma Jones is losing her family farm, because she refuses to turn it into condos and now the land is taxed as if there was development on it”
Georgism ignores how many voters are vehemently anti-development. Just visit any hearing where housing is discussed, people really hate the idea of getting more homes built.
> Suppose you see an area in upward economic trajectory, you buy a bunch of land/properties, then do fuck-all for the next 30 years while the hard work of everyone around that land causes your land's value to increase. You contribute nothing, while benefitting from others' contributions.
In a market economy, if it's a known fact that the area is in an upward economic trajectory, then the future increase in usefullness of that land will already be priced into the land today. You can't just make profit (in expectation) by going and buying land in an area that the market already knows is going to become more productive. Competition amongst investors will drive expected profit to 0.
The only way that you can actually make a profit as a speculator, is by bringing new information to the market. The rest of society thinks this area has no potential, but you have good insight that is costly to figure out, which tells you that the area is going to be more productive. You take a risk and purchase the property. You are compensated for the risk and effort you undertook, and if you're wrong, you are punished by losing money.
>>> boring scut work of implementation. Now I realize that the boring scut work is actually what precedes, and even leads to, changing the consensus.
See every enterprise project. The code for s written, the app is promoted as working in this department and the the project gets funded and approved. Under some other manager
Yes, it works. It makes childless gloomy cities that are now also going bankrupt (see: Austin, TX).
Because why would you move into a shoebox-sized apartment that costs as much as a single-family home and doesn't have any grocery stores nearby (see: Manhattan)?
But don't despair! Your unit 31E will be allowed an individualized door knob and a space for a whimsical 4x5 inch placard.
This guy has been grinding his axe and wasting folks' time here for years. Even when shown how middle-density towns are the most efficient for utilities, taxes, infrastructure, etc. Even when confronted with the falling rents of Tokyo and yes Austin in times when they've briefly overbuilt. Don't waste your time.
Austin is the only possible outlier so far. My model predicts that housing prices (sustainably) fall in dense cities only when the population declines, so Austin's population should be declining. There is no data _yet_ to prove or disprove it, the ACS data series will be released in about 1 year. The IRS data will also be available around that time.
However, some proxy data tends to support _my_ viewpoint. The student enrollment in Austin schools has dropped unexpectedly this year.
A compelling review of the authors work, but I think there would be benefit from dropping the early reference to UBI: LVT is an interesting approach and line of reasoning. UBI is a political hotbed with deeply acrimonious feelings on all sides.
When you align one idea with another external one, you are adopting all that external baggage - it's a cheap way to get a few additional people to agree, but at the cost of a bunch of other people seeing what they perceive as warning signs of a class of ideas they are suspicious of.
It's important to have confidence in your idea, on its own merits.
It's actually a really key part of the functioning of the LVT. It is fuel to grow the economy, just like the LVT is the stick that punishes those who hold back the economy by hoarding land.
At least, that's my opinion. Carrot based economic policies have a tendency of working in multiples of the money involved, and penalties a bit less than that.
”The taxes will go up and getting a job is going to be optional” is a really hard sell, because anyone who has done group projects at school knows that freeloading is a massive issue
More money in the hands of the entire population have a multiplicative effect in the economy, as it spurs more spending, and that spending is organic choices by tons of people, rather than it just sitting in the investment accounts of a few wealthy people.
The fuel of capitalism is a large population of consumers. To be extent that we have inequality and we have lots of pork that are unable to make economic choices due to poverty, we limit the growth of the economy.
One of the lessons of macroeconomics is that subsidizing demand doesn’t really grow the economy, it’s mostly just results in inflation. Obviously not a hard law but if UBI causes people to work less then the economy will shrink, no matter how much stuff people want to buy.
My understanding is that UBI experiments show that is not the case. UBI is a safety net, and does not lead to a significant drop in labor. With the pending waves of AI and automation impacting labor we'd be well-served to continue to explore how to make it work.
Inflation is caused by the Fed's 2% inflation target. If tomorrow Congress passed a UBI, backed by nothing extra, the Fed would respond by raising rates, and inflation would be the same exact long-run value of their target.
But a UBI funded through an LVT is much better than that. An LVT is a non-distortionary tax. This means that increasing the tax does not change behavior. But it is not only non-distortionary, it also reduces the ability to speculate as land tax rises. This causes the LVT to be a net-good tax. The lack of an LVT is a subsidy to the owner of the land. Ending rent-seeking will thus cause the economy to grow. This would result in deflation, and so the UBI is necessary to bring us back to our inflationary target.
The article shows a good example where this will have a massive impact to the economy, even if it is not true in most of the world. That place is South Korea, where roughly 50% of the population lives in the Seoul Capital Area, which continues to grow every year. This has caused significant economic damage, as young people are unable to afford to have both families and a place to live in Seoul, but they must live there in order to have a job. They can simply not afford to live outside of Seoul, where housing is less, but wages are much less.
If they were to enact an LVT with a UBI(or as Georgists call it, Citizen's Dividend) then the population of Seoul that would prefer to move out into cities and towns throughout SK would finally be able to afford to do so. They would only need to be able to find a job that allowed them to live a lifestyle that they preferred.
That's what great about a policy that does not advocate for any particular out-come, but about reaching equilibrium economic states. For places that have to low density, it incentivizes density. For places that have to high density, it incentives spreading.
It's much easier to do things like pursue higher education or start a business when you don't have to worry that you'll be homeless if things don't pan out.
Because having more money than what's needed for basic subsistence is nice? Because it's something that interests you? Maybe you'd be one to lounge around doing nothing if you had UBI, but UBI studies so far have demonstrated that you'd be the exception rather than the norm.
It's freakishly weird to see this at the top of HN. I had never heard or read anything about Georgism until last week, when I stumbled onto it after randomly seeing a photo of a 100-year-old billboard on the Wikipedia page for the term "speculation". I spent a few days researching it on and off. In fact, I just navigated to HN from the last page I was reading about it. It seems like a clever way to address a number of very pressing modern issues.
I think it's better to say that HN readers have a soft spot for clever solutions that seem like hacks. And the LVT is really a huge societal hack to unlock a lot of prosperity and eliminate a lot of poverty.
Allow to me cite another beloved HN blog by way of explanation for why this mostly appeals to people without a strong understanding of the systems they want to “fix”.
I directionally agree! I grew out of Big Systemic Fixes in my 20s. The great thing about LVT is that it can be implemented piecemeal at the small scale. I think we should do that; have some tolerance while we thrash out the bugs; then let matters progress as they will.
While i don't agree with Big Systemic Fixes, i certainly agree with - or rather, acknowledge the existence of - Big Systemic Problems. We should tackle those when we can, with appropriate caution. LVT's viability, IMO, is predicated on gradual rollout and low cost of reversal.
I would not call a "hack" a "systemic fix" in fact quite the opposite.
And those who work on understanding the systems (economists) universally agree that the hack is a great hack, across all sorts of schools of thought, something that's pretty much unheard of in economics.
I hope you are as interested in detail as you purport with your link, and go and look at the real world examples of doing this hack in practice!
Honestly, a week ago after I got deeply into Georgism and totally apart from this, I was like:
This is the hack that fixes inequality in the 21st century, provides for a UBI, fixes the housing shortage, lowers inflation, ___and___ is astonishingly libertarian in a way that would still achieve a lot of those progressive goals, but could be embraced by self-employed / founder / developer / capitalist / middle-class and upwardly mobile non-bitching people like myself... even those of us who do own land.
Next thought was that I should start a political campaign based on it. It probably would function as a sort of systemic broad-spectrum antibiotic for our current monopolist "late capitalism", at least on a street level.
Then a week later it's topping HN, so why bother ;)
shrug I must've missed it. I guess the fact that I was enchanted when I read it last week, and I've been here 15 years, illustrates something about common zeitgeist that I had stopped ascribing to HN awhile ago.
2. Even if it didn't work, Georgism is fundamentally a more just and fair system.
3. The world really needs it right now. Housing, wealth inequality, climate change, the inability for most populations to understand how to properly balance aspects of capitalism and socialism.
Friends let their friends know about Georgism! Do the right thing!
One of the problems with many of these tax proposals is that it’s not accompanied by a reduction in taxes. So it’s basically just a tax increase masquerading as innovative tax policy.
It would be great if politicians implemented it as tax neutral and as originally designed: the ONLY tax, and including renters. Some jurisdictions are doing it that way.
It’s unclear to me what problem it seeks to solve. Market value changes for every asset, not just land, and unearned wealth creation is common. Should all software engineers return the 50% of their salary that market forces caused to increase and give it to typists?
I will probably believe it more when the proponents act on their recommendations, say, if Lars sells his house and sends the 50% appreciation he says in his blog he didn’t earn, as a gift to the Federal Government to reduce Trump’s deficit.
The standard reform we actually pitch is a revenue neutral swap for existing property taxes. The tax we are reducing is the building tax, shifted onto land instead.
> One of the problems with many of these tax proposals is that it’s not accompanied by a reduction in taxes. So it’s basically just a tax increase
Done honestly, land tax replaces property tax. The problem of tax increases is orthogonal. Your paragraph doesn't address LVT, it addresses cities being broke.
> It's unclear to me what problem it seeks to solve
Unfairness of existing tax; rent-seeking; insufficient housing supply; unpriced externalities; take your pick.
> unearned wealth creation is common
...and, typically, taxed. I have a Capital Gains liability for mine, which comes due when i sell.
> Should all software engineers return the 50% of their salary that market forces caused to increase and give it to typists?
No; they were presumably taxed on it already; and it's currently dropping, also due to market forces. But that's beside the point. Their income, inflated or not, was earned. LVT is about pricing in an externality that currently goes unpriced, that is deemed to be owned because someone a long time ago planted a flag. We do not need to abolish the concept of land ownership, but we should question assumptions about it.
> I will probably believe it more when...
That's just insane.
> My concern is also aligned with Orwell
No, you merely quoted Orwell out of context. FFS. By all means borrow a pithy line, but don't claim an authority who doesn't agree with you.
Orwell was a passionately radical and progressive. He fought in the Spanish civil war. He wrote "Down And Out In Paris And London". I don't know if he ever wrote about LVT, but my bet is that he would have been strongly in favour of it.
It's deeply weird how little interest there seems to be the inquiry of why Georgism failed in the past despite being an enormously popular political movement. It was tried. And abandoned. Investigating that history would yield a lot more compelling information than musing about the hypotheticals of what would happen if it was implemented now.
its unclear to me how you could pay for the massive tax burden of a modern state with a single tax. while i agree in theory that taxation of land is the most "fair" type of tax, it does not seem possible that eg. the federal US government could obtain $7,000,000,000,000 from a %5 tax rate on land, without making it completely unaffordable for the average citizen to own a modest home.
if you were to couple Georgism with a massive reduction in state spending i would be more on board i think.
The US ideological push for homeownership is what eventually led to the housing shortage that we’re in now. If we tie up a big chunk of the majority’s net worth in their house, of course they’re going to vote for their own net worth going up. Of course they’re going to vote for renters to become their serfs. Of course they’re going to vote for subsidizing housing demand instead of subsidizing housing supply.
We needed a government to crush the majority’s house values yesterday. As a consolation prize, we got ‘08. It sucked investment out of housing, and we got a booming economy.
The average citizen should not own a home and be allowed to vote at the same time. Canada experienced the consequences of a psychotic ideological homeownership push, China dodged it by intentionally deflating property values, the US will pay the price if people keep voting for property values to go up.
Buried in the middle, a whole section on "won't landlords just pass costs into tenants" passed over with the weakest deflections. This is willful naivety.
Evidence is presented suggesting landlords don't lower rent when costs go down, and a hand-wavy claim is made by-symmetry that they won't raise rents when costs go up. It's nonsense, there's nothing to rebut.
I think i see the error in your thinking. You believe that rent is low-margin and cannot be sustained at a given level if costs rise.
That's never been true anywhere I've lived. Landlords generally charge the maximum the market will bear. In high-demand areas, letting is highly profitable. A London flat, say, will generally net five figures above the mortgage.
LVT is, definitionally, only high in those places.
No I don't. I believe landlords grab any excuse to price gouge. You're tilting at a strawman.
Edit 1: We agree rent is a problem, we disagree that your LVT "one weird trick" is effective, and I'm opposed to the trojan-horse-end-of-income-tax which gets this stuff on HN in the first place.
Edit 2: you'll win more hearts without the patronizing/smug rhetoric.
Apologies for the condescension. The position you've outlined makes no logical sense to me, so i discounted it. Let me ask in a spirit of enquiry: Why are they waiting for LVT?
They hike the rent ten percent and say it's because of LVT - if LVT didn't exist, they'd say it was because of the war on Iran, or interest rates, or mercury in retrograde.
> we illustrate how conventional property taxes punish those who improve properties and invest in the city by providing housing and business, while those who own vacant lots or surface parking lots are rewarded for holding land out of use.
This was made dramatically obvious in Christchurch, New Zealand, after the 2011 earthquake.
Land that previously housed people or businesses in the central city became unsealed carparks run by an overseas company that dominates parking businesses here, for years, and many still are, 15 years on.
Likewise, the owners of buildings rendered unusable by earthquake damage had no compelling reason to demolish and rebuild, as their local taxes dropped significantly, as they're based on land value and improvement (i.e., building) value, and the building was now worth nothing.
So long as the increase in the value of the land outweighed the now minimal local taxes they paid, they'd still come out ahead when they finally sold.
Hence the local government resorted to naming and shaming the so-called "Dirty Thirty", because they had no other levers to pull.
But this still doesn't address the previously utilized land that is now just a muddy carpark operating for the benefit of a company in Singapore - they have no economic incentive to invest in a parking building when they can just run their business on several hectares of unsealed and frequently muddy and pot-holed sections in the central city while paying minimal local tax.
And in and around Auckland, New Zealand's most populous city and the most expensive to buy or rent a home in, they struggle with the land bankers, and ghost houses - properties owned solely for (largely untaxed) capital gains.
> we illustrate how conventional property taxes punish those who improve properties and invest in the city by providing housing and business, while those who own vacant lots or surface parking lots are rewarded for holding land out of use.
The reasoning makes no sense applied to land value tax though: people improve properties for their own profit, and the land value (on which the tax is raises) increases slower than the value of their own property so they aren't being deterred by the land value tax. People who don't invest on the other hand don't see increase in their profit while their taxes increase because the land value is being pumped up by those who invest.
Is there any evidence to support this 'land banking' and 'ghost house' theory? I've heard it mentioned but the rate of unused housing in Auckland is low from what i can see.
Here's a dumb question. If there was just one tax, the lvt, what would stop businesses sort of rediscovering income tax.
I mean putting a line on your pay slip called "lvt contribution" and then state the pre-lvtc salary in job descriptions and stuff like that.
Similarly with vat and related taxes. The incentive in both cases being to signal: here's what we would pay/charge if it weren't for the government. Which is presumably the current incentive to state before tax salary/cost (this assumption could well be totally wrong).
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[ 0.22 ms ] story [ 98.7 ms ] threadIf you have something you want done in your town, and you come with the work done AND not asking for funding, you're likely to get it.
If you come with the work done and a PLAN for getting the funding, you also have a good chance of success.
I am very open to be told strategies to fight this more effectively without becoming a full time career activist for years on end for one issue at a time.
Just in general saying "please fix professional licensing" isn't actionable, you aren't doing the work for them. You're asking them to turn a vague idea into law, when it wasn't their problem to start with.
Get a bunch of town councils on side and you're better placed to tackle the vested interests at the next level up.
I'm not saying this doesn't happen, but probably 80% of the value of lobbying comes from just showing up and talking to the representative. You won't know what works, unless you do the same.
You've been here a long time, and it's dismaying to see a longstanding user degrade the site like this.
If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html and taking the intended spirit of the site more to heart, we'd be grateful.
(I suppose I'd better add that this has nothing to do Georgism. You're welcome to make substantive points thoughtfully, but this was not that.)
Also Georgism is 100% LVT -> A land tax alone has been the recommendation of many economists before and after George - From Smith, Riccardo, Mill to Friedman. Across classical, neoclassical, Keynesian, Austrian schools. If there's one thing economists can agree on, it's that land tax is better than income tax.
You are paying the government rent in perpetuity for the services they provide, including enforcement of your property rights. If you wish to live on land without paying government rent, you will need to go to a place without effective government. Today, that would be Syria, parts of Sudan, or Mali as examples. I doubt you want to live in those places as a 1st world resident, but if you do, there's little stopping you.
If you're talking about an individual not using the land commercially - well theoretically the tax burden lowers the sale price. You don't pay both. At 100% land tax, the sale price would be zero. You pay only as you use the land. That also seems just to me.
How much of the land value of your country do you currently own? A land value tax is likely to increase the amount of land you own (the profits of). I don't think US tracks land values as accurately as countries with some kind of land tax.
Full LVT never works. It always ends up shot through with exceptions and loopholes and, in the case study, inducing corruption. And it's all predictable, too, if you know anything about taxation policy and American political culture. For full LVT you'd need to start from a blank slate, not just from a legal perspective but from people's expectations about property ownership.
I get why an LVT makes sense from an economic perspective, but in practice it feels nearly as unfair as the above. Residents especially, but small and medium sized businesses would very quickly lobby to eviscerate an LVT. Imagine long-time residents getting kicked out not because a developer wants to make buck, but because the tax system requires that to happen. There's zero chance such a scheme could survive intact politically. In Pittsburg it's an LVT in name only, with a long list of exceptions and curious appraisals. And once it's applied ad hoc, which it must, there's all manner of distortions and incentives for corruption.
There are many ways for land use and tax policy to improve, but you have to come at from the perspective of improving the existing system, not revolutionizing it with an LVT. And you could probably get closer to an LVT by smart incremental reform than you could by trying to nominally pursue an LVT.
Ick.
Georgists would say that if some corporation built Disneyland next door, I no longer deserve to live there. How am I to compete with the vast productivity of a massive corporation?
Where do I deserve to live then? Only where my productivity matches the economic bar of those around me?
I'm getting old and tired. Am I only allowed in a retirement home?
For devil's advocate's sake, how is this not state sponsored gentrification?
In your specific example, you shouldn't assume that the supposed change in the "highest and best use" will be enough to price you out if you're a typical homeowner (not a vulnerable renter in a sharply gentrifying area): the numbers don't really pencil out that way. High land values exist in some places, but they're quite rare and quite concentrated.
In a mathematically-perfect setup (100% LVT going entirely to UBI, with zero overhead and zero other government expenditures), the break-even point where your LVT exactly equals your UBI would mean that you own your exact equal share of that tax jurisdiction's total land value; if you own more, then you pay for it, and if you own less, then you get paid for it. Obviously in the real world some of that LVT revenue has to go toward paying people to collect taxes / distribute income checks (not to mention the many other functions of a typical government), but the point is that LVT+UBI produces a self-balancing system that maximizes fairness even for people using their land “non-productively”.
Yep, great analogy. LVT is the optimum tax from the point of view of maximising production incentives, but actually practical ways of extracting significant revenues from people tend to skew towards "this person/organization has liquid funds available and wants to do something enough to pay the tax on top". (For related reasons LVT-style approaches to taxation work rather well when the finite resource being taxed is something like broadcast spectrums which the average person doesn't own)
As for Single Taxing, convincing the public theres some ethical principle that PE funds buying tech stocks deserve to keep all of the rewards for risking their money on a particular venture and homeowners who lived through the area's dodgy-reputation years don't is a complete non-starter even though anyone with an economics degree can tell you why such an argument might be made...
You even pay rent when you buy a house. The value of the land is the market expectation of the value of future rents.
You can have a less than 100% LVT to get some of the advantages without upsetting the apple cart. Common in many jurisdictions.
Those who use their fair share are no change, those using more see taxes go up, those using less see a rebate.
The more valuable Land a business uses the more they have to pay, encouraging more efficient utilisation. Their competitor using less Land has lower taxes and can thus out compete them.
Land of course isn’t just dirt, it’s any limited natural resource.
Yeah, I looked at the map in the article and thought, wait a minute, why is Pennsylvania not colorcoded if Pittsburgh has a land value tax? So the map is only showing states that do? I didnt know there were any states that tax land. But do remember being confused when I moved to Pittsburgh by there being two separate taxes - for land and for property.
I also think that the pittsburgh example shows that LVT is meaningless. All homeowners care about here is their total real estate tax. How it is split between land and property nobody pays attention to.
Right, because there's already a home on the property.
Anyone who owns a parking lot or vacant lot, will care very much about the split.
Georgeism is just silly from economics standpoint
This is overstating the case by a lot. There is a lot of discussion about land value taxes being efficient for various means, but there are far fewer economists who would suggest that 100% LVT is a good idea.
It just wouldn’t be popular. It would instantly get filled with holes and exceptions and distorted until it tries to approximate something else.
Some of the high level economic features that 100% LVT advocates want, like forcing people out of their properties when they become too valuable for other uses, are actually extremely unpopular with people who actually live in homes. You would get a wave of cases where grandma got pushed out of her forever home because the LVT got too expensive and a developer bulldozed it to build a strip mall instead. Under the economic model this is a good thing because the land is being used for its best value, but people actually hate this stuff.
Land value taxes are also really bad at progressive taxation. The hardcore LVT people think this is a good thing because they talk about taxes as “disincentivizing extra work” but we all know that taxes have never stopped people from earning money. Going full LVT puts us in ridiculous situations where someone who earns $500K for a tech company but works remote from a luxurious house somewhere where land is not valued much will pay almost nothing in taxes, but a family with modest income who works a trades job (which generally requires being close to a population center) will have to live in some form of housing subject to very high taxation, therefore paying a lot in taxes.
If you still don’t see it, imagine the outrage when people realized that some billionaires are barely paying more in taxes than a family of four in a modest house in a city where land is valuable.
The more you read about Georgism you more you realize how it’s not as popular with economists as it’s portrayed. There is valuing in taxing land, but we already do that! The debates about eliminating other taxes and replacing them all with LVT is something else, and it’s not universally popular at all.
Yeah that's the exact distinction I was drawing. The article says Georgism but talks about land tax in general, which is popular with many non-Georgist economists.
However, I have to take issue with your example
1) Land is effectively nationalized under 100% LVT. Worker likely own (the profits of) more land than before
2) The value of the land where the tradesman works is already used against him, to extract the majority of hte profits of his labor. He already pays the land value tax - to his landlord. From his perspective, the burden changes little while the wealthier lose an avenue to make money without working.
3) A luxurious house / lifestyle still requires paying land tax on the things you consume (the land of course and notably energy sources, minerals, timber, building materials, etc). The kind of spartan lifestyle required to truly avoid this tax works now too - incorporate as a company and don't pay yourself a salary.
4) I think very few people care about a $500k salary tech workers, or footballers, or what have you. It's the billionaire oligarchs influencing politics who attract the most attention.
5) Current day oligarchs derive a lot of their wealth from land and other monopoly rents, not from simply 'working more' or 'contributing more value'. This is resented by many. When people get rich by contributing (relatively more) value, they are usually widely praised
If you incorporate and don’t pay yourself a salary you still owe corporate taxes.
People absolutely care about the tax rate techies making 500k are paying. They’ll care even more when the billionaires start blasting the airwaves with ads about how unfair it all is.
Athletes have the highest tax rate in the country, why do you think people don’t care about their tax rate?
As far as I know the only tech billionaire with significant land holdings is gates. Zuckerberg and Ellison have big holdings too but not compared to the land per wealth that normal Americans have.
That's the biggest obstacle but also the biggest motivation for increasing land tax. The number is barely 50% currently and falling fast. Of those 40% are owned outright, the rest have mortgages.
This isn't even accounting for commercial real estate and farmland. People complain about grocery price gauging where I live but supermarkets are no more profitable than before covid - they don't realize the main expense change has been land rent.
Once you take out a mortgage you're committed to speculating on that land's future value. If that expectation doesn't pan out, you get a GFC. A gradual land tax would remove some fuel from that fire.
> If you incorporate and don’t pay yourself a salary you still owe corporate taxes
Well yes but actually no - e.g 'buy borrow die'. Regardless, my point is avoiding a land tax isn't as simple as living somewhere with cheap land (it requires consuming less), and people (companies) do also avoid income taxes (it doesn't require consuming less).
> Athletes have the highest tax rate in the country, why do you think people don’t care about their tax rate?
I've never heard anyone talk about this. If I search 'taylor swift tax rate' vs 'elon musk tax rate' I think it's clear.
> As far as I know the only tech billionaire with significant land holdings is gates
Why limit to tech billionaires (who do own lots of land)? The class that specifically didn't make their money from land monopolies, and who pay little effective tax under current system anyway? Trump, Kushner, Witkoff come to mind.
If you're concerned about taxing tech specifically - well George is one of very few people in the 1800s who genuinely considered the full AI + robotics case.
You're close to understanding why people wouldn't like it.
100% LVT schemes are basically a mechanism for letting the government force people to do things that the government wants. You want to live in your forever home that you and your husband worked for 50 years to afford? Sorry, government has other plans for that land and now it's too expensive for you to keep it.
The utopian use case that proponents talk about is replacing parking lots with high rise apartment buildings, which everyone loves because it feels like a win for the people and a loss for developers. The more realistic use cases would be much less popular, like the 90-year old couple getting forced out of their forever home because it's close to a substation, which suddenly turned that land into highly valuable property for data centers, which will happily pay those taxes and bulldoze the homes.
Every time I read a 100% LVT piece it's focused on the parking lots to houses type story. They either ignore the more obvious problems of people being forced out of their homes everywhere for businesses to take over, or they do a hand-wavey thing to say it's all for the greater good and we shouldn't care.
Every 100% LVT argument turns into an argument against private property ownership and in favor of a central planning type land reallocation, but with the final use case going to the highest bidder.
People do not actually want this.
Also datacenters are absolutely not going to be built on ultra desirable land, why would the developer ruin the land value that way?
19 year-olds on the other hand already compete with businesses for land (especially corporate landlords - who pay more than datacenter owners) and are losing rapidly.
You do lose the option of speculation - buy early before a town or region is built up. In the current system, speculation is not an option, it is compulsory.
Also you can't force everyone out of their houses - people could simply reserve land for residential purposes (as is already the case). It is still a democratic system, after all.
Finally, western governments already use eminent domain to repurpose land. It's already a part of our system.
Allowing the elderly to stay where they are isn't just about protecting vulnerable boomers, it's about not being a problem for responsible people in the next generation. You could also be one of those no-contact assholes and never have to deal with your parents when they get screwed by displacement, land value tax away.
Like most ideas in this category, they become less popular as people grow older and build up some of their own assets. I would expect popularity of this idea to fall of sharply around the age that people start buying a home and see their property tax bill go up.
Practically, this makes it a complete dead end. Much to my lament in every election, younger people don't vote as much as they post online and respond to polls. Older people don't post online and respond to polls as much as they actually go out and vote.
This is why the Georgism thing always seems popular on niche internet boards, but would never get anywhere in a real political system.
We're about to have a board vote eliminating single-family zoning (I expect us to win) and this rings extremely true about local politics. If you count "votes" in Facebook comments --- Facebook is where all our local politics happen --- you'd think this is the most contentious issue in the world. But in our last mayoral election, you'd draw the same conclusion about the race being tight, and in fact the progressive rinsed the moderate by a huge margin.
The same thing is very true of public meetings; the turnout for comment at those things is almost never representative of the area's median sentiment. "No" turns out for everything; "yes" rarely does.
I spend a lot of time in online arguments with opponents, on the theory that I'm not really writing to the person I'm arguing with but rather to everyone quietly reading comments. But it's almost certainly the case that the only conversations that have really mattered have been with electeds themselves.
That’s the exact opposite of the experience I’ve had in my town.
It seems that money is the primary driver of turnout at town council meetings. I live at the top of a mountain with 1 real road and 2 smaller frequently closed roads down to the city below. Developers really want to build up here, but there’s no way to widen the road, and no realistic way to build more. There’s not enough flat land to build enough jobs, shopping, dining etc… up here, so increasing density just means more cars making the trip 30 minutes into the city.
Every single time there’s an issue about development, you get dozens of real estate agents, developers, and people who work in construction showing up because their bank account depends on it. Every local election, you have candidates bankrolled by out of town developers.
“No” is much less well organized and will only occasionally turn out in larger numbers than “Yes” despite dominating in elections.
Construction cost per unit goes up a little, but land cost per unit goes down a lot, because you buy the same plot of land and put N times more units on it.
That ignores all the people who have other incentives to build.
Depending on the area you probably have about 10% of the people who have jobs that directly benefit from new construction (construction workers, plumbers, electricians etc…) or who are married to people who do. Then you have all the people who work or own businesses in sectors that indirectly benefit from new construction or directly benefit from increased density.
In my town of 8k people, I’ve seen 30 people from those groups show up in support of a new sub division vs half a dozen against.
Especially since these days it is entirely unclear whether a given keyboard warrior is actually a human being at all.
That all being said, I find expropriation to be loathsome, and I think the movement to destroy single-family zoned neighborhoods is a species of evil that borders on satanic.
Isn't restricting what people can lawfully do with their own land a form of expropriation?
Imagine you own land subject to a restrictive covenant. The restrictive covenant might actually have positive value to you – if the entire neighbourhood has a restrictive covenant prohibiting certain land uses, that gives your neighbourhood a character, people are willing to pay for the character the covenant enforces – maybe the existence of the covenant was actually a factor in convincing you to purchase this specific property. Suppose a legislative change invalidates the covenant – that's the government taking away from your land something you value about it. Isn't that an expropriation?
And I don't think there is a fundamental logical difference between a restrictive covenant on the title, and zoning as a government-imposed land use regulation. Some buyers choose a property because of its zoning, its zoning is something they know about and value; if the government changes the zoning, and that takes away from their property something they valued about it, isn't that an expropriation?
Note, I'm not arguing that removal of zoning and restrictive covenants is always wrong – maybe sometimes it is the right thing to do, all things considered. I'm simply arguing against the position "land use limitation = expropriation, removal of it = not expropriation" – even if something is expropriation, sometimes expropriation is justifiable
And if you just buy a property and don't actually make this agreement, I definitely don't see a problem with abolishing it. We're talking about the government telling you what you can do with your land, and then stopping doing that.
If there was already a zoning or restrictive covenant, and you knew about that when you bought the land – then the ability to do with the land what that zoning or covenant prohibits is not part of the rights to the land you acquired, and the enforcement of that zoning/covenant isn't denying you any of the rights you paid for.
Besides that, private property is (almost always) a creation of the government. [0] I own a house. If I trace the chain of land titles, it ultimately ends in a government land grant; the government got it by stealing it from the Indigenous people. The government land grant was issued on the condition of obeying the government's laws as in force from time-to-time. You can't sell what you don't own; the original land grant recipient didn't own the land independent of that condition, so none of the subsequent purchasers could either. So the government restricting my ability to use the land I purchased isn't an infringement of any of the rights I actually paid for.
[0] I live in Australia; under Australian law, "native title" is considered to pre-exist Australia's current British-imposed system of governance, but all other land titles derive their legal existence from being created by that system; I don't think the situation in the US is fundamentally different, all non-Indigenous US land titles derive from action of the state or federal governments, or the colonial governments, or the Mexican or Spanish or French or Dutch or Russian or Hawaiian governments
I live ten blocks from a neighborhood in Portland called Laurelhurst. Laurelhurst sits on a hill, about 30 blocks east of downtown, and contains the largest 100-year-old mansions east of the river. At each main entrance to Laurelhurst, there are massive stone archways. The arches were built to define the points where Black people were not allowed to enter after sundown.
This is not the case today.
Speaking as someone whose Dad grew up in segregated Baltimore, my grandfather was a bar owner who wasn't even allowed to own or work at a bar in the white neighborhoods. They couldn't rent or buy a house in the white neighborhoods.
The situation today has nothing in common with that. We own homes and businesses wherever we want to. Fold up your manufactured guilt and sympathy and take it elsewhere, we didn't need your help and we still don't.
Also just as an interesting historical oddity, here is a map of home deeds in Chicago that still have (obviously illegal and unenforceable) racial covenants. Including tons in the Washington park neighborhood made famous by Raisin in the Sun!
https://experience.arcgis.com/experience/32c7a747127e46dda11...
This is not ancient history.
I'm not saying I oppose abolishing either racially restrictive covenants or single family zoning. On the contrary, I support the abolition of the former, and am open-minded about the abolition of the latter.
What I'm opposing is particular arguments to those conclusions – what one might call libertarian(-adjacent) arguments – not the conclusions themselves.
I think, a legal right to racially homogenous neighbours is a property right, and taking it away was an expropriation of property – but an expropriation I support. And I don't think one is always owed compensation for such expropriations either. Legally speaking, not all "regulatory takings" are entitled to compensation; and I'm unconvinced the answer is different if we look at that question through a moral lens rather than a legal one.
So, between 1926 and 1948, there was a US Supreme Court case upholding racially restrictive covenants. There were also many state court cases reaching the same conclusion. So yes, the US courts had reviewed them and found them to be legally binding.
Furthermore, although from 1948 onwards they were officially legally unenforceable, it didn't stop new such covenants being made, which served as a social signal that non-white residents weren't welcome; the 1968 Fair Housing Act made it illegal to create such a covenant, as opposed to them merely being unenforceable in the courts.
> Furthermore, although from 1948 onwards they were officially legally unenforceable, it didn't stop new such covenants being made, which served as a social signal that non-white residents weren't welcome; the 1968 Fair Housing Act made it illegal to create such a covenant, as opposed to them merely being unenforceable in the courts.
Yeah, this is more what I was wondering about in my comment above. You had mentioned the idea of a "legal right to racially homogenous neighbours", and I was curious if that was actually an explicit legal right at any point rather than just something that in practice people did without getting into trouble. It sounds like there were a couple decades where it was explicitly a legal right, and then another couple decades after where it was in the "implicitly allowed despite not being considered legal" territory (and presumably for an indefinite period beforehand was also basically allowed, just without the definitive legal ruling on it).
To clarify, I didn't expect that you were wrong by using that phrasing earlier; I just had no clue either way, and it seemed like it might be useful context for the discussion either way.
Under English real estate law, while there are some constraints on your ability to make covenants, the rules are quite broad. A century ago, racial discrimination wasn't illegal or clearly contrary to public policy in most common law jurisdictions – indeed, many of them had explicitly racially discriminatory laws on the statute book – so racially restrictive covenants weren't obviously disallowed. The US, with its constitutional prohibition on discrimination in the 14th Amendment, was actually the only common law country in which there was a decent argument they weren't legal – but SCOTUS rejected that argument at first, then changed its mind over 20 years later. In the 1945 case Re Drummond Wren, the Ontario High Court ruled them illegal – but it cited the just signed United Nations Charter as grounds for doing so.
I bought my house with a close neighbor because I know the neighbor can’t build a steel mill in their backyard. If the government comes in and says we’re all free now to build steel mills, that gain in freedom is a loss in value for me.
It’s no different from buying a house with a great tree in the neighbor’s yard, and then they cut it down. Was that part of the value of the house to you? Yep. Was there a promise that it would stay there forever? Nope. Is cutting it down expropriation? Nope. Should you have assumed it would be there forever? Absolutely not.
Here's where Georgism gets clever: The initial Georgism says that land should be taxed up to the value of its land-rent. Some progressive people said, well, that means the landlord wouldn't make any money anyway, so the government should just take (expropriate) the land. George said, basically, no. Let the landlord decide if it's worth it for them to keep the freehold.
Then, there are varieties of Georgism that disagree about whether the government should be allowed to tell you anything at all about what to do with your property. Some say you should be able to do anything on it. Others say not.
When I bought my house, across from an elementary school, I knew I didn't have a right to drill oil on it, or to build a factory making solid rocket boosters and dumping perchlorates in the basement.
That's all written into the code governing the land before you buy it. The Georgist question is: If I'm paying 100% tax on this land's rent value, does that mean I get to despoil it any way I want? Or do some rules apply?
That's a separate and more nuanced question; the answer is probably that the same rules would apply as do now, but that doesn't equate with expropriation.
I have no idea what georgists would say about that. My guess is that being a the holder of such land would work as luxury/status-signal because you are only incurring the cost of the land and no/low revenues from it
Zoning and planning distorts land values so georgism alone won't solve land use problems. E.g. Demand for land with fewer property rights (such as single family zoning, or a heritage restriction) will be lower than the site next to it that allowed building a 200 floor residential tower. In turn its land value will be lower.
It might still yield a high rent tho, but maybe not more than a new well maintained apartment.
It wouldn't directly address those planning issues, but it aligns the financial incentives of the body politic between residential homeowners and the rest of the community. Normally residential homeowners have huge financial incentive to make housing scare and expensive, the LVT removes that financial gain from causing misery.
Many areas where people want to live and where homes should be built, can sometimes have a large portion of home owners like Mosman, Bondi, Croydon or Woollahra in Sydney. A tax on the unimproved value of land just doesn't get home building started here if no one is a renter (I recall increases in rent were tied to LVT in Progress and Poverty). And if its based on valuations the valuations will again be distorted by planning controls.
If you upzone these areas for towers, the moment the first person takes the gazillion dollar offer from a developer suddenly homes get built, and suddenly everyone else want to exit. And besides if you have LV Tax their land value will got up because their land will have fewer development limitations, higher demand, etc, etc.
Georgism is cool, land tax is cool, but it's not a silver bullet.
If your goal is to make homes more affordable, reforms like the ones they did in Auckland (loosening planning controls) is the way to go. https://onefinaleffort.com/auckland
Similar thing is taking place in Austin Texas right now as well. https://www.pew.org/en/research-and-analysis/articles/2026/0...
If your goal is to redistribute wealth Georgism is not a bad option, but again planning controls (zoning, Floor space, height limits, heritage controls, parking minimums, upper setbacks, excessive lower setbacks) can suppress the true size of the tax base.
and while an LVT doesn’t really care about zoning, depending on how close to a city center your SFH is, a well calibrated LVT might dramatically increase your overall tax burden even if you dropped all other taxes. SFH zoning is manufactured scarcity; LVT prices scarcity correctly, and there’s no upper bound on that value, especially since land taxes become divorced from income.
I should have clarified that. I meant it in the context of Georgism. The concept of Georgism was manifestly against the government actually redistributing owned land; instead, landlords would divest themselves of the land if the only utility they got from it was rent. What Georgism says you're paying for when you pay LVT on the land you own is the exclusive right to private use of that land, which comes at the expense of everyone else who doesn't "own" (or essentially, lease) the right to live on it or build on it.
Georgism distinguished between ownership by individuals for productive use and ownership by either (a) individuals for rent-seeking or (b) governments for redistribution.
You may be right about LVT pricing scarcity where I live higher than my current tax basis, but even that would make sense since I earn a lot and pay inordinate income tax to have the ability to live in a single family home near to a city center. But there is a funny corrolary to that which Georgism seems to intuitively grasp and which is orthogonal to the argument between manufactured scarcity. (And maybe this is a gap in Georgism's argument):
I live in inner southeast Portland, Oregon. Along all our east-west avenues there are tons of Amazon boxes (what we call studio / one bedroom 4 story cheaply constructed wooden apartments with a patina of modern amenity). And tons of local businesses. Between the major streets it's almost all single family homes. This makes it one of the last cities in America where you can live in a SFH within walking distance of everything, including downtown. Street parking is still free here, and a lot of people don't need a car at all. I live in an SFH within two blocks of apartments where the waiters and bartenders live who works at the restaurants on the avenue. It's truly mixed use. However, they've now rewritten the zoning law to allow tearing down houses as small as mine (1200 sqft) and replacing them with 4-plexes. The problem with the Amazon boxes is that they don't provide room for families. No one is building 3 bedroom apartments where you can raise your kids in the city.
Which gets to the heart of the matter, which is that a major reason that this city and this area are so desirable is precisely because those SFHs exist between all the major streets. The usefulness of not needing a car and being able to have a family in the city center is widely overlooked by people campaigning to eliminate SFH zoning, but without it you end up with neighborhoods where everyone is under 30 and relatively transient, without much money to spend locally. The apartments decay, and most of the work reasons for living there disappear.
Eliminating SFH zoning is an opinionated form of redistribution that preferences a certain age group and a certain socioenconomic position over others. It reduces actual diversity, and produces monocultural places like Seattle and Santa Monica where only the very rich can raise a family in town, and everyone else is a young renter.
i’d play your observation back at you though: there’s more than just young renters and nuclear families in terms of household typologies, and nearly all of the other ones (childless couples, empty nesters, older singles aging in place) would also benefit from ownership (or “rooted”) housing opportunities that things like a quad would provide in these neighborhoods. household size across the US has been shrinking for decades, and there is truly a lot of demand for smaller homes at all stages of life. instead of looking at the quadplex in the SFH neighborhood as a way for “young renters” to displace families out of the neighborhood, it’s an opportunity for other households to take root or make a life transition without having to leave.
if quads in SFH neighborhoods are just being overrun with young transient renters, it probably means there’s not enough “amazon boxes”, and may be related to broken zoning at the upper end of the spectrum.
also, this is all without saying… it is entirely possible for children to be raised in a home that is not a detached SFH! it is certainly a preference for a lot of people, but it is not a hard requirement. and missing middle buildings like the 2/4/6 plexes are some of the best non-SFH buildings for doing that, where you can more easily have 2-3 bedrooms and some sense of a yard.
I'm not sure what you mean about the lack of new construction of that type coming from broken zoning at the upper end of the spectrum. Maybe uou could elaborate. The upper end of the spectrum in Portland is... almost everyone with money moves to either the oldest exclusive homes in one of two very non-diverse neighborhoods (Laurelhurst or the West Hills), or else they move to the exurbs and build McMansions out in the farmland. Neither is really actively engaged in a community beyond a homeowner's association, and neither is walkable or a place where people of different economic and cultural backgrounds get to interact for everyone's benefit.
So maybe what I'm trying to say is that the high upper end (homes over $1M, let's say), is going to remove itself anyway, and that yes there should be more construction of 2-4-plexes which are not Amazon boxes... but there seems to be no incentive to build those things, and I don't even know how you could do so on a 1200 sqft lot.
In the interim, Portland has eased lots of rules on the use of ADUs and trailers in backyards and even yurts. I bought my home for $450k and the range in the area goes up to $800. This tells you that what I'm arguing for is a working middle class that should have access to living in the city with a modest back yard.
But I do feel like the crusade against SFHs has a distinctly classist, anti-middle-class, anti-family quality to it... and what I mean to say is that it is the working middle class families in the upper end of housing on those avenues who anchor those blocks and keep the neighborhoods livable and loved and who keep the businesses in business. I've seen what's happened to such inner city SFH neighborhoods in Los Angeles, and it turns into somewhere that no one would want to live if they didn't have to, with no community or neighborhood to speak of. Row houses and shared brownstones in East Coast cities have fared slightly better as an attractive living pattern.
Ultimately too, your argument is that not everyone should live where they live, because more people want to live in that spot, so if they want space they should move to the suburbs. My argument is that not everyone can afford to live exactly where they want, either way, but that doesn't logically imply that you should increase density as much as possible in a mixed and vibrant neighborhood just because people want to live there. At a certain point it will lose the very thing that makes people want to live there in the first place. Not even to get into the fact that no one actually works downtown anymore or commutes away from the neighborhood, so this is purely a choice for most people.
You still didn't address my point that every SFH torn down for a 4-plex just redistributes individual middle class ownership to financial corporations.
> what I'm arguing for is a working middle class that should have access to living in the city with a modest back yard
If housing has gotten so expensive that the "working middle class" has to live somewhere else and commute in, the way to attack that is to increase the stock of available housing, not continue to sharply restrict it.
> crusade against SFHs has a distinctly classist, anti-middle-class
To the contrary, relaxing zoning requirements most strongly benefits people who are less wealthy and currently end up overspending on housing or getting priced out.
I'm definitely living in a very weird bubble in eastern Portland. It was a working-class, blue collar town of single-family homes. It was colonized in two separate waves, in the 90s and in the 2020s, by people who couldn't afford rents or homes in city areas of San Francisco or Seattle. But it never really took off economically as an international city, and it's still stagnant, and much more reminiscent of Seattle in the 1980s.
There's a lot to like about that pattern, and under Georgism it would make lots of sense for people to move here because the land value close to downtown isn't really that great. Or to move to Cincinnati, or Lexington, or Des Moines. If all people had to pay was fair rent on the land, new local communities and diverse downtown areas would be springing up all over America.
Not everywhere that people rush into and want to live because it was shown on the Real World needs to instantly resemble the same monocultural sort of housing that a big city like Los Angeles or Seattle has had to adopt.
Moreover, there's nothing inherently immoral about retaining the shape of a city when more people move into it; presumably, they are moving there because they like the city.
When I see working people being priced out of Seattle or LA, they're being priced out by financial groups and offshore investors, with the help of local boards that allow homes to be torn down and replaced with half-empty investment apartment blocks... destroying the very thing they're investing in.
We may be clinging on as homeowners and holding to a way of life that is incompatible with the kind of colonization other cities experienced, but: We take care of our parks. We know each other. I can't go 4, or 8 or 12 blocks that I don't see people I know. Up in the Amazon boxes, we meet the people who come for a year and go.
What equity is there for us in the plan to remove single family zoning? Not even as a parable:
10 miles west of Portland, Intel built a giant facility, and there is a commuter train stop out there which has Amazon boxes for miles around it. But no SFHs in their new construction, nor anything that would be attractive to anyone over the age of 29.
Why should I move out there and they move here, when in reality, that wouldn't even exist without the ancient core of SFHs that defines the character of the city they ostensibly want to live in?
Combined with some kind of odd ways is describing things (cities being "colonized" in recent decades, people moving to LA because it was on The Real World, as if there hasn't been close to a century of tropes of people moving to Hollywood to pursue show business, implication that eliminating SFH zoning requires you to "move out" when it certainly does not require any individual homeowners to do anything different than what they're already doing), it's hard not to get the impression that you're basically trying to argue in favor of NIMBY without actually saying it.
You're right, it is that there is denser zoning in close proximity that makes us want to live where we do, and makes it walkable. Which contradicts the idea that I'm making a NIMBY argument. I don't want to live in an all-SFH suburb or in a high density zone that's all rentals. I also don't want to live in the only SFH surrounded by condos. I think your point is that the SFHs don't contribute anything to the mixture, and are somehow parasitic on the higher density zones. I think that's not true. Both sides of the mix are important. It gives the neighborhood a character that doesn't exist in most American cities, which is: People of different backgrounds sit together outside cafes and talk. On any given day we hang out with other homeowners, their kids, young professionals, and also people who work in the service industry who live in the neighborhood and go to the same places they work on their days off. We go to concerts with them, they come over when we BBQ and hang out at our house.
My argument is that this arrangement is much better for society as a whole, and for individuals across the socioeconomic spectrum, than a division between all-SFH suburbia and all high-density inner city. Especially now that most people don't commute to an office, and most of the commuting is done by wage workers who have to commute out to the suburbs to work in a strip mall. The homeowners close to downtown provide an economic base for higher-end local businesses that renters would not be able to support. The people who work in those businesses earn enough to rent in the neighborhood where they work. With all high-density, families are essentially exiled to the burbs, there is little to no socializing between economic classes, and everyone has to commute.
Sure, re-zoning doesn't affect individual homeowners immediately, but the endpoint or goal of it is to ultimately get rid of SFHs in inner areas, not to leave a healthy mixture standing. That's what I see as the problem. And I think it's a politically motivated goal based on the idea that no one should really own a SFH (or if they do, as one poster put it, they can move somewhere far away from the city).
In some ways it's similar to the tourism or gentrification problem - the very things that make a place desirable lead to the destruction of those things. Some people view the world through a purely economic lens and treat individual people as abstracted production/consumption units. And unfortunately there's no real way to put a dollar value on "all the neighbors know each other and help each other out". And even if you could - you can't just BUY your way into that, no matter how much money you have! The only way to unlock that value is to live there and engage with the community. Obviously there will be turnover but what some people don't seem to grasp is that there is a tipping point, where enough newcomers overwhelm the "old timers" and destroy the culture of a place. And think about the game theory of it from the point of view of a resident - why invest time and resources in a community if you're just going to leave in a year or two? Or if the beneficiaries are future random people who are not going to give a shit about the community?
"you can't just buy your way into that" is a great insight.
I don't understand what you're trying to say here at all. If you're trying to argue against some sort of development or planning change that doesn't change anything about your own property due for reasons that are purely about how it would affect you personally, that seems like NIMBY to me. The fact that you happen to not be arguing for universal SFH doesn't somehow make it not NIMBY.
Independent of that, I don't really find the rest of what you're saying compelling. You're arguing against a change to eliminate something with concrete, known problems on the basis of wanting to preserve "character". I still maintain that this is indistinguishable from any NIMBY argument.
I can imagine a sensible zoning rule requiring an appropriate fraction of housing units to have 2+ bedrooms and another fraction to have 3+. (There is no particular reason that a multi bedroom unit needs to house a family. Plenty of 20-somethings are happy to have housemates.)
Due in part to suboptimal fire codes, the US has trouble building nice multi-unit buildings with 2+-bedroom units, but other countries manage just fine.
Prices have risen in the past 10 years, but the median SFH in Portland sits at around $550k. 54% of the housing stock in Portland is SFH.[0]
The 1% don't live in the city, they live in Lake Oswego and other suburbs where the average SFHs are twice as large (at least).
[0] https://www.portland.gov/phb/documents/2024-state-housing-po...
Denser developments are also much more fiscally productive than SFH zoning [1]. This means that cities that upzone will tend to have lower taxes, less debt, and better services in the long run.
[1] - https://www.youtube.com/watch?v=SmQomKCfYZY
after five years in the trenches of local housing/urban policy in my city, this is my biggest takeaway. i don’t think i’ve ever even once changed someone’s mind who was a staunch NIMBY, even with a reputation as one of the most accessible and persuasive local policy advocates/writers. but I have been able to build coalitions of hundreds of people by finding people who were already mostly with me, and just shifting them from inactive->active.
there’s also a lot of power in the energy of building for the future. when we passed our big SFH elimination ordinance two years ago, we had a packed city council meeting that, numerically, had 50/50 of residents speaking for/against. but for the city council, watching a parade of retirees 65+ come up and say the same thing over and over again (“i’m not sure this is right for our city”) vs an equal sized but diverse group of people of all ages and life stages speak about all of their different housing needs and dreams for the future, the weight in the room was overwhelmingly in favor; the new zoning passed unanimously.
"Yes you worked your whole life for that house that you carefully chose and maintained, but we want to send its value through the floor because we're more powerful".
Around here (Metro DC), that simply hasn't happened. There's so much pent up demand for housing that at worst, the appreciation has slowed, but I'm not even convinced that's happened, as the infill/redeveloped land is actually being used and generating economic activity (vs parking lots or old flats and offices nobody wanted).
Why would you tax people for those things? They didn't do them.
Also, you didn't reply to what I wrote, which is that it's funny that you were trying to convince us that land value appreciation is a return to labor. I'm guessing you ditched that because it's obvious how silly it is.
It might be unfamiliar, but people care about their neighbours and family, and passing on a good place to others to raise their families there in future.
Yesterday’s home appreciation is today’s price increase for new home buyers. In most places in the US, home prices have far outpaced inflation for several decades now.
It seems silly to even be arguing about whether or not it’s deserved when we already know that it’s not remotely sustainable.
The right learned this a long time ago. Persuasion does not matter. Our system is winner take all. Winning is all that matters. Online debate is a waste of time. Find your base and activate them instead.
You never know until you try.
This is a big deal, because rent is the biggest factor to the avg person's cost of living.
Put another way, one of the historical critiques of democracy was that it ends up catering to interest groups whose interest may not align with the rest of society. At first that seems paradoxical, because a more knee-jerk critique would expect democracy to just turn into a tyranny of the majority. But the reality is that people generally don't act on things until they are sufficiently incentivized to do so. And that incentivization is often reactive in nature.
as someone who reads a lot but doesn't comment much you've got the topshelf content here consistently, its so obvious when someone has a clue or doesn't if you're in the same areas, very easy to fool others with confident assertions (cough airline issues on HN) but for someone in the industry it's not at all
funnily enough this comment about zoning which isn't your or my field but get the feeling it's on point, is such a massive problem in the western world which has built up over decades, lets just copy someone elses homework in my opinion, Asia gets this stuff right: https://devonzuegel.com/north-american-vs-japanese-zoning
So if we're going to start taxing me at a million per year, can I start taxing those loud people a million a year so I can live in the city to pay for medical bills for my brain to go through the bouncing basketball.
Mind you, everyone else in my area has 10 - 15 acres and it's just a dead area. Just people that ran away from the city. There's absolutely no "value" in this land as no one wants to even be here and drive 40 minutes to get to a grocery store.
Obviously this assumes a single tax-base; if you are not in the same tax base of the city, then you're probably still fine, since if everybody has similarly valued lots, the taxes will be shared similarly between them.
It's usually up against some insane shit like Prop 13
Did it actually increase the amount of housing? Reduce wealth disparity? Got enough taxes so cities can make commutes better?
> Land, however, is not built. Land is inelastic in supply, and landowners don’t “provide” land the way laborers provide labor and investors provide capital; they un-provide land by excluding others from using it. Building supply can change in response to a tax change, but land supply cannot.
But many cities actually can increase their land supply via land reclamation. This can be done by filling in waterways or otherwise altering the landscape to make it suitable to build on. Chicago, for example, built the Adler Planetarium by filling in rubble along the shore of Lake Michigan. Boston is an even more impressive example; Back Bay used to be a bay of the Atlantic Ocean, not an entire neighborhood of a city with very high cost of living.
Cities can also lose land. Sometimes this is due to natural causes like erosion, sea level rise, or disasters like earthquakes and volcanic eruptions. Other times a lack of regulation might permit pollution to make land unlivable or infeasible to build on. Land owners can't create natural disasters, but they can advocate for policies that strongly influence effective land supply, such as whether building codes allow building on certain kinds or soil or require resistance to earthquakes.
Does this change the calculus from a Georgist economic perspective? If not, why?
It isn't actually perfectly inelastic, but looking at land reclamation (and erosion!) relative to the ease with which places to live can be added to a locale, the supply of land is relatively inelastic. Even then, that kind of misses the core of George's argument about land value.
George himself distinguished land from labor and capital by looking at it through the lens of whether the economic value of a piece of land needed to be attributable entirely to improvements undertaken on that land. This is his "all natural opportunities or forces," and those are where the constraint lies.
For land reclamation in particular, there are two things to look at: (1) the value attributable to the land reclamation effort; and (2) the residual site value. (2) is land rent, and the Georgist model really is predicated on the relationship the surrounding community has with a piece of land. As it goes, if the community's feelings toward, say, a reclaimed waterfront are tepid, that reclaimed land won't have much value (even if the land reclamation were undertaken at great expense!), and won't command high land rents.
When georgists refer to land, they are referring to locations - not dirt.
Locations refer to the sections of physical 2D space that makes up a country. Why 2D when the world is 3D? Because parcels are allocated and segmented based on a 2D model.
Locations are best thought of as being similar to "spectrum" (what typically gets auctioned off every few years to the highest bidder) - there is a total fixed amount. Nobody made the physical space, and nobody will make more of it in the future. It all existed before life even began on this planet, and it will exist long after all of us are dead.
Although we don't have LVT in the UK, it interesting that we have another restriction on the creation of Locations: Planning laws in the UK are extremely hard and expensive to navigate and get permission to build pretty much anything, so the creation of new Locations is pretty much impossible. And that doesn't seem to be a good thing.
The premise of Georgism is that there is no creation of locations (at least unless you're in the business of creating planets).
> Places that were too far from London to be useful suddenly became Locations
No, those were always locations, before and after the construction of railways made them more valuable. Accordingly, Georgists ain't interested in taxing the gains of the railways themselves; we're only interested in taxing the gains of the landowners profiting off of their land suddenly being more valuable from no contribution of their own. Under LVT the railway companies still would've made their money back in droves — probably moreso if they're only paying taxes on the land under the railroads instead of the actual railroads themselves!
Alternatively, reclaimed land is usually a state initiated enterprise in most cases. In those situations, the land can simply be leased out by the state. This is literally what NYC did with Battery Park city!
https://blog.landeconomics.org/p/georgism-through-land-leasi...
Since unreclaimed "land" if it can be owned, can not generate any rents, it won't be taxed at all. But if all the additional value of making it usable were taxed away with a full LVT, it creates very little incentive to reclaim it and make it usable.
I think the best thing to do would be to exempt reclaimed land from land value tax for a period of time. Just like we grant monopolies for patents for a fixed value of time to incentivize sharing of the secrets.
If you got 50 years on reclaimed land without tax, it would heavily incentivize its creation.
> Cities can also lose land. Sometimes this is due to natural causes like erosion, sea level rise,
When there's a full LVT, the transactional sale price for land is very close to $0, because your land rents are taxed away. That leaves only the buildings as something that's lost to the natural disaster, so in many ways this might be far better for property owners.
It would also alleviate many of the challenges with relocation when necessary, from flooding, etc. Since the land is no longer the valuable part of the relationship estate, only the building must be moved/replaced.
Suppose you see an area in upward economic trajectory, you buy a bunch of land/properties, then do fuck-all for the next 30 years while the hard work of everyone around that land causes your land's value to increase. You contribute nothing, while benefitting from others' contributions. All this while someone who could have used that land/property for a more productive used is deprived of it. Georgism directly counters that by taxing any 'base land value' that you own.
Georgism and the 'taxing progressively higher any property a person directly/indirectly owns after first N properties' are seriously very much needed around the world, economic rent-seeking steals from future generations.
I don't see it in the article, but the progressive nature of the tax is important. It makes it harder for large landowners to pass along the tax, since they must compete with smaller landlords. The net effect should also stabilize land appreciation, which will no longer rise with rapidly increasing wealth disparity as it has in the past couple of decades. And we won't need clunky, patchwork solutions like the ban on home ownership by private equity.
This is the argument again Georgism I have the hardest time countering.
If they could raise rents, why haven't they already?
And if their costs go up and they can't make ends meet, they will sell the property, possibly at a loss, and the lower value will lower taxes.
But this won't happen, because the landlord's taxes won't rise. They'll almost certainly fall, as shown in the abundant data. And if for some reason the landlord's property tax does rise, it's because it's a ridiculously underused parcel in an area of really really high value, like a duplex next to 10+ story buildings. Which means it may be best to let 100-300 people use that parcel rather than ~10.
The LVT shifts tax burden away from homes and businesses and towards empty lots and parking lots.
To put it another way, why not raise taxes to $1M/sq.ft.? $1B/sq.ft.? If if were true that it wouldn't be passed on to tenants then you've found the magic money tree.
A property tax affects all square footage of apartments quite equally, which is very well correlated to rental prices, so a property tax is roughly equally a rise in all landlord's costs. So in the very few housing markets where rental prices have fallen to near the cost level, and there's very near zero profit in renting, property taxes could easily cause a rise in rents.
However when switching to a land value tax from the current property tax system, the incidence is quite different than a broad property tax increase. Some landlord's taxes fall quite a bit, some landlord's tax bills might increase.
And then all landlords will see a surge in vacancies, and not all landlords are able to tolerate paying LVT on empty units for very long before they're forced to drop their rents back to the actual market value.
> why not raise taxes to $1M/sq.ft.? $1B/sq.ft.?
Same reason why landlords can't raise rents to $1M/sq.ft or $1B/sq.ft: because nobody in their right mind would pay that much.
The first effect Georgism would have is, more effective utilization of real estate. If you go to any big city, there is simultaneously a shortage of properties while a significant number of vacant properties. This would disincentivize vacant properties, so more supply (or at least more tax collected on vacant properties that the city can use for better purposes).
Also, the reason for making progressive tax larger on larger landlords means renting out a few homes is significantly more economically attractive while beyond a certain number, it is no longer viable, which pins prices down.
I would worry that you just substitute a rent seeking landlord with a rent seeking government (local?).
Broadly, government is not called rent-seeking because it does things to justify its keep: law, defense, roads, bins, etc etc.
Georgism ignores how many voters are vehemently anti-development. Just visit any hearing where housing is discussed, people really hate the idea of getting more homes built.
In a market economy, if it's a known fact that the area is in an upward economic trajectory, then the future increase in usefullness of that land will already be priced into the land today. You can't just make profit (in expectation) by going and buying land in an area that the market already knows is going to become more productive. Competition amongst investors will drive expected profit to 0.
The only way that you can actually make a profit as a speculator, is by bringing new information to the market. The rest of society thinks this area has no potential, but you have good insight that is costly to figure out, which tells you that the area is going to be more productive. You take a risk and purchase the property. You are compensated for the risk and effort you undertook, and if you're wrong, you are punished by losing money.
See every enterprise project. The code for s written, the app is promoted as working in this department and the the project gets funded and approved. Under some other manager
Because why would you move into a shoebox-sized apartment that costs as much as a single-family home and doesn't have any grocery stores nearby (see: Manhattan)?
But don't despair! Your unit 31E will be allowed an individualized door knob and a space for a whimsical 4x5 inch placard.
I'm sorry. Did you say "Tokyo"? THIS Tokyo: https://www.globalpropertyguide.com/asia/japan/home-price-tr... - in a country with _declining_ population?
Or maybe this one - https://www.reddit.com/r/JapanFinance/comments/1ovp3et/price... ?
You folks never cease to amaze.
> Don't bother arguing with economics deniers.
So far, I have not seen a single clear example of a city that decreased its housing prices by building more denser housing.
And yes, I maintain that Austin is not a counter-example. Its population has been at _best_ stagnant, and I believe that it's now declining.
Here's the data for Tokyo rents: https://www.patiencerealty.com/post/tokyo-rents-hit-record-h... - can you point out which period you're talking about? Or admit that you were wrong about mentioning Tokyo?
Austin is the only possible outlier so far. My model predicts that housing prices (sustainably) fall in dense cities only when the population declines, so Austin's population should be declining. There is no data _yet_ to prove or disprove it, the ACS data series will be released in about 1 year. The IRS data will also be available around that time.
However, some proxy data tends to support _my_ viewpoint. The student enrollment in Austin schools has dropped unexpectedly this year.
I'm pointing out that Austin is a great illustrative example of what will happen when you allow density to proliferate.
https://news.ycombinator.com/newsguidelines.html
When you align one idea with another external one, you are adopting all that external baggage - it's a cheap way to get a few additional people to agree, but at the cost of a bunch of other people seeing what they perceive as warning signs of a class of ideas they are suspicious of.
It's important to have confidence in your idea, on its own merits.
At least, that's my opinion. Carrot based economic policies have a tendency of working in multiples of the money involved, and penalties a bit less than that.
Care to explain how it would work in practice?
The fuel of capitalism is a large population of consumers. To be extent that we have inequality and we have lots of pork that are unable to make economic choices due to poverty, we limit the growth of the economy.
My understanding is that UBI experiments show that is not the case. UBI is a safety net, and does not lead to a significant drop in labor. With the pending waves of AI and automation impacting labor we'd be well-served to continue to explore how to make it work.
https://www.nber.org/system/files/working_papers/w32719/w327...
But a UBI funded through an LVT is much better than that. An LVT is a non-distortionary tax. This means that increasing the tax does not change behavior. But it is not only non-distortionary, it also reduces the ability to speculate as land tax rises. This causes the LVT to be a net-good tax. The lack of an LVT is a subsidy to the owner of the land. Ending rent-seeking will thus cause the economy to grow. This would result in deflation, and so the UBI is necessary to bring us back to our inflationary target.
The article shows a good example where this will have a massive impact to the economy, even if it is not true in most of the world. That place is South Korea, where roughly 50% of the population lives in the Seoul Capital Area, which continues to grow every year. This has caused significant economic damage, as young people are unable to afford to have both families and a place to live in Seoul, but they must live there in order to have a job. They can simply not afford to live outside of Seoul, where housing is less, but wages are much less.
If they were to enact an LVT with a UBI(or as Georgists call it, Citizen's Dividend) then the population of Seoul that would prefer to move out into cities and towns throughout SK would finally be able to afford to do so. They would only need to be able to find a job that allowed them to live a lifestyle that they preferred.
That's what great about a policy that does not advocate for any particular out-come, but about reaching equilibrium economic states. For places that have to low density, it incentivizes density. For places that have to high density, it incentives spreading.
I wouldn't trust myself with it, so I wouldn't trust others. Lets hope you are right, and that I am the exception.
Serendipity, I guess.
It never ends.
I think it's better to say that HN readers have a soft spot for clever solutions that seem like hacks. And the LVT is really a huge societal hack to unlock a lot of prosperity and eliminate a lot of poverty.
Allow to me cite another beloved HN blog by way of explanation for why this mostly appeals to people without a strong understanding of the systems they want to “fix”.
https://johnsalvatier.org/blog/2017/reality-has-a-surprising...
While i don't agree with Big Systemic Fixes, i certainly agree with - or rather, acknowledge the existence of - Big Systemic Problems. We should tackle those when we can, with appropriate caution. LVT's viability, IMO, is predicated on gradual rollout and low cost of reversal.
And those who work on understanding the systems (economists) universally agree that the hack is a great hack, across all sorts of schools of thought, something that's pretty much unheard of in economics.
I hope you are as interested in detail as you purport with your link, and go and look at the real world examples of doing this hack in practice!
This is the hack that fixes inequality in the 21st century, provides for a UBI, fixes the housing shortage, lowers inflation, ___and___ is astonishingly libertarian in a way that would still achieve a lot of those progressive goals, but could be embraced by self-employed / founder / developer / capitalist / middle-class and upwardly mobile non-bitching people like myself... even those of us who do own land.
Next thought was that I should start a political campaign based on it. It probably would function as a sort of systemic broad-spectrum antibiotic for our current monopolist "late capitalism", at least on a street level.
Then a week later it's topping HN, so why bother ;)
2. Even if it didn't work, Georgism is fundamentally a more just and fair system.
3. The world really needs it right now. Housing, wealth inequality, climate change, the inability for most populations to understand how to properly balance aspects of capitalism and socialism.
Friends let their friends know about Georgism! Do the right thing!
It would be great if politicians implemented it as tax neutral and as originally designed: the ONLY tax, and including renters. Some jurisdictions are doing it that way.
It’s unclear to me what problem it seeks to solve. Market value changes for every asset, not just land, and unearned wealth creation is common. Should all software engineers return the 50% of their salary that market forces caused to increase and give it to typists?
I will probably believe it more when the proponents act on their recommendations, say, if Lars sells his house and sends the 50% appreciation he says in his blog he didn’t earn, as a gift to the Federal Government to reduce Trump’s deficit.
Done honestly, land tax replaces property tax. The problem of tax increases is orthogonal. Your paragraph doesn't address LVT, it addresses cities being broke.
> It's unclear to me what problem it seeks to solve
Unfairness of existing tax; rent-seeking; insufficient housing supply; unpriced externalities; take your pick.
> unearned wealth creation is common
...and, typically, taxed. I have a Capital Gains liability for mine, which comes due when i sell.
> Should all software engineers return the 50% of their salary that market forces caused to increase and give it to typists?
No; they were presumably taxed on it already; and it's currently dropping, also due to market forces. But that's beside the point. Their income, inflated or not, was earned. LVT is about pricing in an externality that currently goes unpriced, that is deemed to be owned because someone a long time ago planted a flag. We do not need to abolish the concept of land ownership, but we should question assumptions about it.
> I will probably believe it more when...
That's just insane.
> My concern is also aligned with Orwell
No, you merely quoted Orwell out of context. FFS. By all means borrow a pithy line, but don't claim an authority who doesn't agree with you.
Orwell was a passionately radical and progressive. He fought in the Spanish civil war. He wrote "Down And Out In Paris And London". I don't know if he ever wrote about LVT, but my bet is that he would have been strongly in favour of it.
if you were to couple Georgism with a massive reduction in state spending i would be more on board i think.
Also, I don't think it precludes a sales tax or tariffs, etc.
We needed a government to crush the majority’s house values yesterday. As a consolation prize, we got ‘08. It sucked investment out of housing, and we got a booming economy.
The average citizen should not own a home and be allowed to vote at the same time. Canada experienced the consequences of a psychotic ideological homeownership push, China dodged it by intentionally deflating property values, the US will pay the price if people keep voting for property values to go up.
That's never been true anywhere I've lived. Landlords generally charge the maximum the market will bear. In high-demand areas, letting is highly profitable. A London flat, say, will generally net five figures above the mortgage.
LVT is, definitionally, only high in those places.
Does this help you understand?
Edit 1: We agree rent is a problem, we disagree that your LVT "one weird trick" is effective, and I'm opposed to the trojan-horse-end-of-income-tax which gets this stuff on HN in the first place.
Edit 2: you'll win more hearts without the patronizing/smug rhetoric.
They hike the rent ten percent and say it's because of LVT - if LVT didn't exist, they'd say it was because of the war on Iran, or interest rates, or mercury in retrograde.
This was made dramatically obvious in Christchurch, New Zealand, after the 2011 earthquake.
Land that previously housed people or businesses in the central city became unsealed carparks run by an overseas company that dominates parking businesses here, for years, and many still are, 15 years on.
Likewise, the owners of buildings rendered unusable by earthquake damage had no compelling reason to demolish and rebuild, as their local taxes dropped significantly, as they're based on land value and improvement (i.e., building) value, and the building was now worth nothing.
So long as the increase in the value of the land outweighed the now minimal local taxes they paid, they'd still come out ahead when they finally sold.
Hence the local government resorted to naming and shaming the so-called "Dirty Thirty", because they had no other levers to pull.
https://ccc.govt.nz/the-council/future-projects/barrier-site...
But this still doesn't address the previously utilized land that is now just a muddy carpark operating for the benefit of a company in Singapore - they have no economic incentive to invest in a parking building when they can just run their business on several hectares of unsealed and frequently muddy and pot-holed sections in the central city while paying minimal local tax.
And in and around Auckland, New Zealand's most populous city and the most expensive to buy or rent a home in, they struggle with the land bankers, and ghost houses - properties owned solely for (largely untaxed) capital gains.
And then we struggle with a housing crisis.
The reasoning makes no sense applied to land value tax though: people improve properties for their own profit, and the land value (on which the tax is raises) increases slower than the value of their own property so they aren't being deterred by the land value tax. People who don't invest on the other hand don't see increase in their profit while their taxes increase because the land value is being pumped up by those who invest.
I mean putting a line on your pay slip called "lvt contribution" and then state the pre-lvtc salary in job descriptions and stuff like that.
Similarly with vat and related taxes. The incentive in both cases being to signal: here's what we would pay/charge if it weren't for the government. Which is presumably the current incentive to state before tax salary/cost (this assumption could well be totally wrong).