> Do you really believe that landlords will subsidize tenants for a long time?
This literally happens all the time in California.
You buy a house in CA. You move somewhere else. You hold on to the house because your property taxes are fixed and housing prices grow like crazy here. Maybe your kids will want it. Maybe you'll want to move back..
You can't charge enough rent to cover the mortgage and taxes os you end up taking a loss monthly.
Yeah, because the value of your land just went up and you didn't do anything to make that happen. Only right that excess value goes back to society and reduces the tax burden of the working class.
If you're a professional landowner and investor, and the taxes on one parcel of land in your portfolio went up because someone built Disneyland near it, this is fine. You might want to sell that parcel out of your portfolio now; or you might want to do something like build a hotel on it catering to Disneyland-visitors, which will earn you enough in profits to more than make up for the higher land tax.
If you're an ordinary person who owns the home you live in, and they build Disneyland next to it, most of the ways that the value of the land your home is on increases are useless or actively harmful to you. It's actively bad for you if you have to sell your family home and move somewhere else because you can no longer afford the taxes on it. You're probably not a professional real estate developer who knows how to effectively use the land as an investment, after all, you just wanted to live somewhere stable.
In fact, the increase of value of your land and the consequent tax increase under Georgist land value schemes, would be so bad for you, that you might decide to protestthe construction of that Disneyland to begin with. This is typically called "NIMBYism", and it happens all the time even under current property-tax schemes because the negative externalities of many different types of construction are bad for the quality of life of existing homeowners.
> It's actively bad for you if you have to sell your family home and move somewhere else because you can no longer afford the taxes on it.
But it's no problem of course that several generations of people currently can never afford to own a home of their own even though they contribute enormously to the economy and to society through their highly productive labour?
Ten times more people have already been forced to move away from where they grew up because of real estate prices than would ever have to be forced to move away because of land value taxes.
A hundred times more people can never afford a home because of real estate prices than would ever have to be forced to sell their homes because of land value taxes.
How is this different from just having higher taxes on capital gains? (Obviously higher capital gains taxes would also impact other assets, but I mean in the context of land. Seems like both result in the same effect if you're able to defer LVT until sale.)
> How is this different from just having higher taxes on capital gains?
The goal of the deferment is to stop a negative outcome (the resident being forced to sell their property because of higher LVT taxes) from occurring until the resident actually wants to do so.
Seems like a huge risk, what if the land then deprecate after appreciating for a while? You'd owe a lot of money from the appreciation years, but the sale of the house doesn't cover it because it's now depreciated
Or you can.. you know, sell the now expensive property, buy one cheaper which doesn't have such appreciation, and enjoy those sweet money gained by doing nothing (well almost). If you invested in stock and gained significantly, you should also not be taxed more on those gains (and even more in tax progressive regimes in most jurisdictions)? Wealth is wealth at the end, you gain more, you pay taxes.
I get it, people are inherently selfish, most don't want to give back to society more than absolutely minimum to keep them from prison, and this mentality is way more common in US or most of 3rd world than say Europe. But then don't complain when state institutions like public schools and healthcare are utter crap, something about cake and stuff.
Why is it assumed true that individuals do not contribute to the increasing appeal of their neighborhood?
What if I voted for pro-theme park politicians? Or what if I volunteered my time to clean up the community parks and shared space? What if I helped improve the reputation of my child’s school by volunteering and donating to the music department?
My taxes fund the maintenance of public infrastructure and services, and my actions support the civic good. If I vote to be cheap or generous with taxes, or choose to be lazy or ambitious in community support, that all contributes to the desirability of the land around me.
> Why is it assumed true that individuals do not contribute to the increasing appeal of their neighborhood?
Two things are true:
1. I should have been more precise in my language. "You didn't do anything to make that happen" is a useful generality and not a prescription of every single individual in the community. In this case, we're talking about fairness - which I don't actually care much about myself, but is a point that people most often can emotionally identify with. But, to continue, if you're carrying all that water on behalf of your land value, then good for you! You likely have an existing stake in the community, other than the land that you own (maybe the businesses or houses or other property built on that land or you own a local services business). That is great! The fairness comes from owning the finite resource of land, and not something others can provide (housing, businesses, etc.). I hope you do continue to contribute to your local community and increase its appeal!
2. Your fixation on this point reveals a very fundamental misunderstanding of the goal of an LVT (surely partially my fault). It has to do with efficient taxation. Dollar equal, it's better that your taxes come from the value of the fixed resources of your community rather than things that can be increased. Because then you don't have a depressing effect on productivity and the things, other than land, that make your community nice. It's better that you keep more money from the things you _do_ for your community instead of the monopolies you hold in your community.
I disagree with the fundamental premise on both parts.
> "You didn't do anything to make that happen" is a useful generality and not a prescription of every single individual in the community.
In fact, everyone does contribute, positively or negatively, to their community. Either through involvement or absenteeism, or somewhere in between.
> Your fixation on this point reveals a very fundamental misunderstanding of the goal of an LVT
The goal is obvious and not a misunderstanding. The goal is a bad goal, precisely because it punishes positive involvement in the community. To improve the community means to increase your own cost of staying.
Imagine someone wants to avoid displacement due to their taxes increasing beyond their ability to pay. I don’t know why they would want to stay in their economically “inefficient” house, but perhaps it’s because home is where the heart is and they have sentimental attachment to their home.
If they want to keep your housing costs down, the best thing to do is poison the ground (metaphorically or literally) because it decreases the “productivity” of the land. Box stores in America famously pay low property taxes because building a box store actually decreases property values - they’re expensive to demolish and limited in utility, while being an eye sore that makes the neighborhood higher traffic and less undesirable. Mississippi as a state is cheap because the voters used the government to destroy public services - it’s in someone’s best interest to do this in a Georgism world if they don’t want to be regularly displaced.
Quite the contrary, it rewards positive involvement in the community and it punishes anti social involvement in the community (leaving your lot empty, letting your neighbors create a vibrant community you do not contribute to, and then selling at a large profit anyway). The reward is the taxes you're not paying on the positive productivity you're bringing to your community (which is how we're currently punishing those who make their communities nicer).
> If they want to keep your housing costs down, the best thing to do is poison the ground (metaphorically or literally) because it decreases the “productivity” of the land
Yes, if you collapse multi-dimensional problems into a single dimension you can find many logical oddities. If I wanted an easier time finding a doctors appointment, I should murder every non healthcare professional in my local area until all of their calendars are totally clear. Wanting cheaper healthcare is evil! You're really saying things for the sake of saying them and I'm not going to engage further or explain to you when you're saying irrelevant things.
> it’s in someone’s best interest to do this in a Georgism world if they don’t want to be regularly displaced.
Under the majority of proposed LVT policies (and the ones I support) the vast majority of American housing would see a decrease in net property taxes paid since the majority of American's Building / Land value ratio is orders of magnitude higher than the average parking lot, land speculator, etc.
> I should murder every non healthcare professional
Crazy comparison to Walmarts lowering their own property tax because building a Walmart makes future land use less attractive.
(Same thing applies to gas stations which do literally poison their own land)
> I'm not going to engage further or explain to you when you're saying irrelevant things.
Don’t engage that’s fine, but I gave a specific example of a common way to use land (box stores), which explicitly breaks the LVT model. People today use land for many economic activities that are expensive to repurpose, or impose negative externalities.
"the value of your land just went up and you didn't do anything to make that happen"
Ben, with that argument, when someone wants to pay you $1M for "bengarcia.dev", you would not take it because you didn't do anything other than pay $12 to the registrar.
I was pointing to the argument that "you didn't do anything to make it happen. Only right that excess value goes back to society and reduces the tax burden of the working class."
Sounds like Obama's "If you’ve got a business, you didn't build that" argument (though Obama might have just screwed up the words, or maybe he simply had a Kinsley gaffe, aka a Freudian Slip).
The land owner DID work for it. He BOUGHT that land (and also the option that it could go up, or down, in value) with the sweat of his hard earned work or savings, or that of their family or business partners.
OP's wording states that he would favor confiscating value generated by the acquisition if such value happened because the market's perceived value increased.
It's basically a communist wealth redistribution logic.
My point is that if someone were to offer $1M for OP's "bengarcia.dev" domain, that OP would not send $999,988 ($1M minus $12 bucks of registration) to the Federal Government.
Yes Ben, The US Government IS READY TO TAKE YOUR GIFT!
Are you making the argument that land banking is economically productive? Or a more esoteric point about the how people "earn" money? Because land banking is economically unproductive, and there isn't much dispute about that. I'm much less interested in a philosophical argument about whether you believe land banking is definitionally money earned or realised.
“land banking is economically unproductive, and there isn't much dispute about that”
I think you are confusing current utilization with economic productivity. There is an opportunity cost in hoding the land but land can also have economic value in the option. It’s the owner choice if he values its use even if it’s waiting for the option to come through and values it more than whatever alternative a self professed smart politician or OP’s abstract “society” might propose.
Whats’s next? Taxing you for your unused bedrooms, unused cars, unused clothes in your closet, unused nose rings, etc etc?
Just because some policymaker can identify a more productive use for someone’s property does not mean the policymaker knows the owner’s opportunity cost or future options or even risk better than the land owner.
An even better argument might be why do we need to tax at all? It’s not that governments are the pinnacle of capital allocation efficiency. After some useful level, governments are basically corruption machines ESPECIALLY IN CALIFORNIA. Just look at their homeless and illegals industrial complex.
Liquidity is a value of its own. 10% equity in a $1M non-fungible residentially-zoned lot is much less valuable than $100K in cash, ready to wire at a moment's notice.
That's not "only right" at all. Why would "society" (AKA the government) deserve the excess value and not Disneyland, who DID do something to increase the value of the land?
That article is ridiculous “More expensive tomorrow, more affordable today”. It reads like a predatory credit card offer and is full of what if’s.
High property taxes pushing down the sales price of a house does not help the buyer or seller. The buyer is going to pay the same, just more in taxes vs the loan, and the seller is going to get less because high taxes have reduced the value of their home.
If you don't want to pay the taxes, thanks to Disneyland you can now sell your land for a nice fat gain, buy cheaper land elsewhere, and pocket the difference. And whoever bought your land will likely use it for the social good (maybe build a hotel or something).
I would imagine that if Disneyland were built next door, that might be in the cards regardless of the tax situation...
It's just a reality of life that not every homeowner can possibly be entitled to fully control what gets done with the land around them, and that's going to cause some friction.
It's a difficult job to navigate who gets to decide what, while still enabling necessary development. LVT is just one of the more elegant ways to do this.
I'm not a big LVT fan - pushing for maximally productive use of land is going to result in displacing people, displacing small businesses, displacing artistic/cultural/environmental spaces, etc.
I would much rather see an overall assets tax that scales with the value of the assets. That would incentivize more smaller businesses, long-term thinking, and wealth distribution. It would hit big corporations in the same way a LVT would, forcing them to be more and more productive with their assets the more they have, without pricing out smaller entities.
I think that there's something about LVT, but your dismissal is very shallow and why it's not been implemented so far.
I don't _want_ $1M, I want to live in my house that I bought and lived in for years. Getting money I don't need and having to live in a place I don't want to live in is _not_ a positive situation.
I don't think some extra taxes on expensive land is the red line you appear to believe it is. People who own expensive land have many options the rest of the world could only dream of, including reverse mortgages. Meaning no one is actually forcing anyone off their land. They're just being asked to pay some extra taxes. If you believe tax is theft, I can see why this is agitating, but I do not share that view.
I do not share that "taxation is theft" view either. And I agree that owning expensive land is a privileged position. But the concern of being pushed out of one's home because of an increase in tax is real, "just sell it" is not a viable solution, houses and locations are not fungible.
Maybe reverse mortgages are the answer, I'm not sure, I'll admit I'm not very knowledgable about this.
Why do you believe that you should be allowed to preserve your present lifestyle in amber at a (very minor incremental) cost to economic prosperity for all of society?
If only this were true, we wouldn't have homeowners constantly fighting against new development or construction. Many homeowners treat their primary residence as an investment.
> If only this were true, we wouldn't have homeowners constantly fighting against new development or construction. Many homeowners treat their primary residence as an investment.
You'll be very hard pressed to find any home owner who actually thinks in this cartoonish way.
When people oppose changing the character of their home neighborhood it has nothing to do with "treating their primary residence as an investment". It is because they selected a place to live, to call home, based on some criteria that they liked. Everyone does. A home is a big commitment, so you spend a lot of time researching exactly where you want to settle down for the next many decades. You pick an area you like, a neighborhood you enjoy.
For some people that might be quite rural, for some people distant suburban, for others near-city suburban, for others inner-city center. Whichever type of area you select, it is because that's the kind of area you personally enjoy the most. Somehow this obvious truth is controversial on HN for reasons I don't understand, but it is the truth. People select what makes them happy, no surprise.
So, when people oppose seeing their suburban area torn down to build highrises, it has absolutely nothing to do with home values or investments.
People oppose it because they very intentionally chose to live in a suburb far away from highrises and now they see those imposed on them. Of course they're unhappy. Basic human nature, nothing to do with investments.
If someone feels this is not so, I'd appreciate an explanation of your viewpoint.
In my experience the vast majority of NIMBYs do not care about how much their property is worth. They just really don’t want the area they live in to change, because they think all change is bad.
Obviously. If you live in a single family home next door to Disneyland you’re ducking over all the people who want to stay in a hotel there. You should have to pay for that privilege.
I won’t buy Chevy since they removed CarPlay. I’m not paying $10/month for an ability my phone gives me for free (to say nothing of the other integrations CarPlay gives you).
If there are 5x as many truck runs, the trash per truck is 1/5th.
The more likely result is that each of the providers runs far fewer trucks than a single provider would because trucks and drivers cost money. Unless the 5 companies figure out how to get the total revenue to 5x, they can't pay for that.
Let's do an example.
Suppose we have a street with 100 houses and it takes 5 houses to fill a truck. Therefore, it will take 20 truck runs to collect that street's trash.
If there is only one trash company, it will need 20 truck runs to service that street.
If there are five trash companies, each with an equal share of those 100 houses, each of those companies needs only 4 runs to service its 20 houses. Why would any of them do more runs?
Yes, the average distance per run may be higher for the 5 companies, but it won't be 5x.
> Yes, the average distance per run may be higher for the 5 companies, but it won't be 5x.
You contradict yourself at the end of the comment. Yes, it could be estimated a linear equation (mx + b) where m is the cost per house and b is the cost per route, roughly. And then you could have a system of which equations, where each row in the system’s matrix corresponds to an additional company.
The optimal result is probably not 1 company, but it’s probably not 1 company per house either
Every president after Clinton, and maybe him as well, (yes, including Obama) said that Europe had to become responsible for its defense. During that same time, Europe has insisted that it knows better than the US cowboys. And, Europe certainly doesn't like US global power projection.
So, why does Europe need/want the US in NATO?
It can't be resources - Europe is rich. More to the point, Europe has almost 10x Russia's GDP and about 2.5x the population.
So, unless Europe is worried about Germany, it can handle its defense.
It's about the nukes. Europe doesn't want a world where a lot of countries have nukes so the role of the US in Nato was to provide Europe with a nuclear umbrella.
I'm a Swede and something is going on between France and Sweden related to nuclear weapons. Not sure if it's about placing French Rafael fighter jets with French nukes or some type of collaboration about Gripen fighter jets with Swedish nukes.
> It's about the nukes. Europe doesn't want a world where a lot of countries have nukes so the role of the US in Nato was to provide Europe with a nuclear umbrella.
If anything, it has been proven that unless you have nuclear weapons, your country is at risk of being attacked by nations that have them.
Ukraine learned this the hard way, so did many other countries in the Middle East and elsewhere.
In its defence, Sweden does have lutfisk, that's a pretty potent deterrent. Not quite as nasty as Norway's strategic surstromming stockpile, but still enough to deter invaders.
For all the jingoism being spouted, it would be nice if somebody had a whisper in Mango Mussolinis ear as to why NATO and the post 1945 order was formed, and who benefits from it (hint: all our democracies).
NATO was formed to counter the threat of the Soviet Union which no longer exists. Russia is nothing like the same threat to the US that the Soviet Union was. The US is now more concerned about China.
Europe was economically and militarily important globally than it now is. Therefore defending it is less important to the US than it used to be, while Asia has become more important to the US.
Russia is not even anything like the same threat to Europe that the Soviet Union was. It has been further weakened by the Ukraine war and it will take many years to recover.
As for nukes, there are two acknowledged nuclear powers in western Europe.
Yeah, recent events have clarified how much Israel and Saudi (and Bahrain, Jordan etc) are real defense priorities for the US. Expended a lot of Patriot interceptors and lost several aircraft on the ground including an incredibly expensive E-3 Sentry.
Does the US really want to be facing a Europe with multiple nuclear powers and thousands of warheads?
Europe is a sleeping giant. America has long seen it advantageous to keep the giant sleeping. Now it is dancing around shouting "nee-naw" while the giant slowly opens its eyes.
> Does the US really want to be facing a Europe with multiple nuclear powers and thousands of warheads?
Why not? There is no causus belli to fear, and Russia and China already have lots of weapons.
Europe is not really a sleeping giant. People here are in denial about the decline of the west (as shown by downvotes) but Europe is simply not the power it used to be. Just look at the GDP of Europe as a a proportion of global GDP. It has been the slowest growing region for decades.
It is probably time for the Cold War relics to leave. It doesn't help their case that the US and Coalition spent much of the past 25 years since 9/11 engaged in an ultimately fruitless war in Iraq and Afghanistan.
Nobody really wants to look at the Ukraine war in Western Europe. It's very apparent that the degree of caring depends on how far east a country is; Poland are talking about getting the Bomb. The UK has provided significant technical assistance and missiles but the war really is not in the public conversation, and attempts to increase military spending or even fix the Ajax have gone nowhere. Everyone is of course obsessed with refugees, but not at looking where they have come from or what they are fleeing.
The situation got even worse with the new Iran war. Is that going to be a ten or twenty year event? Is the US finally going to get the ground invasion of Iran it has wanted since the Carter administration?
We cannot build a security architecture by looking backwards. We have to look forwards. But I'd settle for looking out of the window at the world as it is today.
> UK has provided significant technical assistance and missiles but the war really is not in the public conversation
Good God! If there has been a "lack of conversation", it is simply because not sporting Ukraine would be utterly unthinkable to us. The UK support for Ukraine has been, and continues to be, one of the largest.
Indeed, under the Homes for Ukraine scheme, UK private citizens allowed 234,000 Ukrainian refugees to come and live with us in our homes and spare rooms. Ukraine flags are flying everywhere in Blighty. Slava Ukraini!
That's what I mean! The practical support has been really good. It doesn't filter back into the Discourse. There's no "having done that, what next?" It doesn't feed into discussions about military readiness or spending. The refugee success doesn't impact the endless small boats discourse.
This is rather like the Cameron administration actually being good on Net Zero.
The US paid for its alliances, hegemony, and safe shipping lanes by providing a comprehensive nuclear and conventional security umbrella via NATO.
Framing calculated realpolitik as an act of charity that the people of Europe should be grateful for is pretty cynical. It's always been a trade-off. The president has always complained publicly about the cost, precisely because admitting that reality doesn't win votes at home, but narratives about European leeches taking advantage of the US does.
If you want to see what it will look like after the US stops paying the bill for its incredibly privileged position, you can read about how much fun the process was for Britain in the 1950s.
Yes, the USA said that, but the damage was done. For many decades any inclinations for EU defense contracts to favor EU arms, were greatly frowned upon. France was derided for having made the right decision from go.
Post-WWII USA would give you Pax Americana, as long as you had no domestic defence industry.
And yet the Europeans have built one defense system after another in that time. I get why countries want to have their own defense industries. If I were running a country I would too. But the extent to which more of those systems haven't been deployed has more to do with mis-aligned budget priorities between countries and old fashioned jobs politics. Only the largest European countries can go it alone in major weapon systems development, and the joint projects tend to founder on discussions over what gets built where. FCAS/SCAF is a perfect illustration of this.
From the US perspective, what's frustrating is extent to which European powers, particularly the largest and potentially most powerful, have allowed their readiness to decline. I remember a particular surprise readiness exercise a few years back in which the Germans were able to get no more than a dozen tanks moving within the first 48 hours. The rest were broken, undergoing maintenance, or had been cannibalized for spare parts. At the time Germany had, on paper anyway, about 300 active tanks.
It's not the sexy stuff like new missile systems and strike fighters that have been neglected. It's the boring parts that really matter like an efficient reserve system, logistics, spare parts, boots, training facilities, ammunition, fuel depots, etc.
Nobody wants to spend a lot of money maintaining a military in peacetime, but an effective peacetime military is insurance: When you don't need it you don't need it, but when you need it you really, really need it. Your country's strategic situation can change really quickly.
There's is no NATO without the US, it would need to be something else and function differently. That takes years because there's too many countries involved. We would likely get two military unions in EU - North and South, North on helping Ukraine and South trying to distance itself. Furthermore the time is running out until this grows into a bigger conflict, this is just from couple of days ago: "Alarm in Denmark after Russian ship fires at military helicopter"
It's possible the conflict will get bigger, but I doubt it. I think what's happening right now is all about internal Russian politics. The Russians will lose in Ukraine without a big influx of new troops, something that's very unpopular. By provoking his neighbors in a few highly publicized incidents, Putin can play into existing Russian paranoia about invasion from the west, which will allow him to conscript another half million men.
But new troops don't help him if the need for troops gets correspondingly larger. My suspicion is after Putin gets his troops most of the talk about a wider war will die down, and all those new resources will be dedicated to Ukraine.
- nuclear deterrence - like other commenters said, no one really wants a nuclear arms race, but I think it's bound to happen. Poland, the Baltics, Sweden/Norway will probably need to develop their own nuclear deterrence, and obviously Ukraine.
- the US for the most part has been a good friend and ally, and has a lot of weight, and above all it helped to create the EU and wanted the EU to succeed.
- Europe has had a lot of conflicts, and a lot of parties funded by foreign states are seeking to bring EU down, including the US administration. It would be nice for Europeans if it wasn't like that.
Then why did the USA sabotaged every attempt at a European army?
The answer is because you twist American President words: they want Europe to "invest" more in its defense, but stay subversient to the US, not take more "responsibility" as you wrote. Which means, in plain terms: "buy more American weapons". There has never been any honest wish for Europe to shoulder its defense, it is a pure money grabbing scheme.
You just have to see the hissy fit they throw every time Europeans put "buy European" conditions to any rearmament program.
Europe would be fully military autonomous if Europeans listened to the French. The countries that blocked and sabotaged French initiatives and European procurement all have a "special relationship" with the US: the UK first and foremost.
>It can't be resources - Europe is rich.
Oh, suddenly we are not "Europoors" anymore. Funny, that.
> During that same time, Europe has insisted that it knows better than the US cowboys.
Uh, weren't we right? I mean, isn't "no more foreign wars" a big rallying cry of a certain president and especially vice-president that resonated with a lot of the American electorate? On what grounds are you snarky here, exactly?
(We also saw from the beginning Trump was a liar, a conman and an idiot, but I guess you will reproach us with that too)
It's unclear how to map "nominal prices" and "years of expenditure" onto "here's the money spent each year to get us to the point that trains run regularly", the latter being somewhat related (modulo interest) to the amount that must be paid by fares and subsidies going forward.
Exactly, so when someone compares the numbers without explaining this incongruity or how they accounted for it, the argument becomes moot. It's like saying the number of oranges is now higher than the number of apples 10 years ago.
Or AMD’s putting sram on a separate chip. I’m surprised they didn’t go there yet except for extra L3 instead of all of it. At some point the costs will shift the decisions.
> California is also talking about shifting to a mileage baded road tax because EVs (which they heavily incentivized) saving money on gas can't go untaxed.
EVs in CA have a special $121 tax to make up for "don't pay gas tax."
There were three alternatives: [1] Don't spend on defense. [2] Spend on defense and buy American. [3] Spend on defense and buy European.
Europe (modulo Poland) picked the worst one. Even [2] is better than [1].
However, Europe did get a couple of decades of "Russia isn't a threat" and "we have soft power" posturing.
But, it turns out that the cowboys were right. There was a bear in the woods.