Potential Alternatives to the Capitalist System

Well, he would, if he purchased some land, have to give his earnings to the government in the form of land value taxes.

But all the land is already owned, so how would he acquire ownership of a piece of land for himself?

 

Taxing something to reduce purchase prices only works on things which are fixed in supply, such as land. Taxes on production and trade increase consumer prices, because they create scarcity, that is why we should abolish those taxes.

Every land value tax proposal I have ever seen comes with a mechanism (either an exemption or citizens dividend) which would eliminate the payment of rent on the first portion of land held by an individual. This first portion of land which is exempt from taxation might be large or small depending on the level of competition at that location. There are a lot of areas in this country where you could move to, where the rent would be covered by the exemption, which would allow you to live a productive life, completely free of taxation.

You will be able to find the answers to your questions here: https://en.wikisource.org/wiki/Open_letter_to_Mikhail_Gorbachev_(1990)

 

Are you advocating a land value tax on landowners? Or are you advocating government appropriation of all private land which would then be offered for rent? Or something else entirely?

 

appropriation is hardly the right word. He wants a Nazi govt to kill millions of Americans to take their private property by force. Any liberal proposal involves violence against its citizens.

 

if a liberal govt killed millions to take their land it would rent it out for far more the private owners since 1) govt is naturally evil, 2) since it would have no restraints on its pricing power.

 

True, THE SPACE THEY OCCUPY is land, but the satellite is not. If that space is scarce, then they'll rightly make just compensation to the community of those whom they exclude from it. There's already an allocation system for geosynchronous satellite slots because they are getting scarce.

You are aware that the examples you gave were built on pre-existing land, and did not create any land.

 

So are you proposing a tax levied on landowners based on the value of their land? Or something else?

 

No, he would be repaying the portion of his earnings that were due to the economic advantage conferred by using the land.

By being willing and able to make just compensation to the community of those whom he excludes from the land, including the present "owner." It seems you are being obtuse because you have already realized that the answers to your questions prove your beliefs are false and evil.

- - - Updated - - -

Exactly. The public revenue system that has been known for over 200 years to be the fairest and most efficient.

 

The inevitable descent into absurdity.

More absurdity. If you want to see evil at work, check out government-free Somalia, whose major industry is piracy on the high seas.

Wrong. It can't affect supply, so it has no pricing power. It can't do better than the private landowner, and just accept the high bid.

- - - Updated - - -

Another absurd fabrication.

It's already been taken by force.

LOL

 

Okay, so I'm a recent graduate. There is a land value tax. I want to buy land. How do I do that? Buy it from someone willing to sell, or does the government get involved?

 

So you're proposing a new land value tax. But I would continue to own my land and home? And everyone else would as well?

You seem to have a problem with people who own land (calling them parasites, etc.). How would a land value tax solve the problem of private land ownership?

 

The government might be involved or it might not. If there are valuable improvements then the government won't be involved. You (the recent graduate) will purchase the improvements from the seller and take over paying the land value tax, same as is currently the case. If there are no valuable improvements then it would be pointless for the owner to try to sell the land, because the land has no exchange value. In which case the owner would abandon the land and you (the the recent graduate) could acquire the land by simply agreeing to take over paying the taxes; which would most likely take place in a government sponsored auction.

Henry George advocated that land value taxes be levied slightly below the actual rental value of the land, in which case everything would work exactly as it does now, except land exchange prices would be substantially lower.

 

What you're proposing does not result in purchasing land but only renting it from government. Essentially taking the primary source of wealth accumulated by and belonging to the middle class. All land is currently taxed by government, even that which produces no income.

Taxes, regardless of where they are used, are a component of the price. While government can tax things out of existence by a tax that raises the price to more than what consumers are willing or able to spend, in most cases that would make no rational sense as it would eliminate a source of government revenue.

Too many currently are living completely free of taxation.

Except for the fact that NONE of my questions are answered in that link. And how did Gorbachev respond to that letter?

I'm still waiting on some figures suggesting what a typical land tax would be. Would it be uniform across the nation? Would an acre of land in Alaska, Texas, Hawaii, Minnesota, and Rhode Island be taxed the same amount?

My youngest brother lives on an acre of river front land and has a property tax bill of about $600 per year which is based on both the land and the house value combined. Obviously the house is the dominant value on which the tax is determined, so what would his tax be under a LVT, less, same or more?

 

The land value tax is already present in all states, so it is not a new tax.

The tax will induce some owners to sell because they are not using the land productively enough to justify their ownership. You don't have a problem with competition ... do you? Otherwise, yes, that is correct.

Land value taxation would make idle ownership of land unprofitable. Businesses which rent the land they occupy would notice no change, except that they would no longer be required to pay taxes on their productive achievements, or withhold taxes from their employees or customers.

 

If a person is living away from government services (like out in the wilderness) and not depriving anyone of land which they would like to use, then why should he pay taxes? He is not consuming government services or infrastructure, he is not depriving others of land, so why should he pay a dime in taxes? I don't care if he makes a million dollars a year building widgets; if he is not consuming government services or depriving others of what they would otherwise have, then leave him alone.

The land value tax is based on the land value. Land in New York City is typically much more valuable than land in New Mexico, so of course the taxes would typically be much higher in New York City.

I don't know how valuable your brothers land is so I cannot give you an exact answer. Are there numerous cow pastures nearby? And are those cow pastures actually trading in the open market for cow pasture prices? If so, then his taxes would probably be what an acre of cow pasture would rent for, perhaps less than $100 in land taxes per year. Under a land value tax the people who live in cow pasture country will pay cow pasture taxes, there is no penalty for putting the land to better use than your neighbor is..

 

Only if he took a larger share of land than is covered by the tax exemption amount.

There are 300 million people in the United States of America and they are all going to die, sooner or later. As they die, land value taxation will ensure that the land they hold will be brought to market. This process of life and death will ensure that the market always has some land available for purchase, and land value taxation (with an individual exemption) will ensure that that land will always be affordable to the generations to come.


“It (land value taxation) guarantees that no one dispossess fellow citizens by obtaining a disproportionate share of what nature provides for humanity.”— William Vickrey, Nobel laureate in Economics (1996)

 

Are you claiming that such persons would then continue to have access to government assistance programs, yet live tax free by refusing to allow government to provide any utility access?

If some land was tax free, would that not create a demand for it, thereby those occupying it would be depriving others from living tax free.

So large businesses could take advantage of the tax free land and create and pay for their own infrastructure needs without government aid and remain tax free?

What makes the land in New York City more valuable than land in New Mexico which may have huge oil and gas reserves beneath it?

Allow me to provide you with some prices being asked for vacant/unimproved property adjacent to my brothers. One lot, 10,018 sq ft, or about .23 acres is for sale priced at $25,500 or about $2.55 per sq ft, and a smaller lot 5,375 sq ft or about .12 acres is for sale priced at $12,900 or about $2.40 per sq ft. There are no cow pastures, and the few houses currently existing in the area are quite nice and owned by people with relatively high income, and most have built docks and boat houses and own some very nice boats too which they currently pay taxes on.

You fail to provide any evidence that a LVT would be an improvement. And what would keep those who have enormous amounts of wealth from paying the LVT on large amount of property simply to control it, requiring government to raise the LVT to a point that the LVT would exceed what they were willing to pay and require another to pay an exorbitant LVT in order to take it over? For that matter government could use LVT as a means of moving people for any reason it feels desirable.

 

You've mentioned the problem of evil landowners being able to throw a baby girl into the sea. So how does a different tax on land solve this problem?

 

So in order to become a landowner, people will have to purchase land from a current owner, just like now. You're simply substituting a tax on land and improvements with a tax on the land only.

 

I never said or implied any of that. I just said that the person should be allowed to be free.

There is enough land that anyone who wants to live tax free can do so. Most people don't want that though. Most people want to live near public infrastructure, so their car doesn't get dusty or muddy. This desire to live near public infrastructure is what creates land value and the base for land value taxation.

That is correct.

Access to desirable public infrastructure and services as well as access to community amenities.

Also you will notice that I purposely use the word “typically” because I knew there could be exceptions to the rule.

As for those huge oil and gas reserves, those are a free gift of nature, so why not tax them heavily and reduce taxes on production and trade?

Then lets assume that your brothers acre of land currently has an exchange value of $100,000 not including improvements. I would guess that his land value tax bill would be around $5,000 annually, but his individual tax exemption would pay for part of that bill. Each individual citizen gets an exemption allotment so depending on whether your brother is married and has children that would reduce his bill even more, possibly even eliminating it.

The benefit of using land value taxation is that production and consumption are no longer taxed. As those tax burdens are removed from production and consumption wages will rise and consumer prices will fall. The typical consumer will have 20% to 30% more purchasing power after those taxes are removed.

The fact that it would be a massive improvement is self evident. Land value taxation removes all tax burdens from production and trade; and if you cannot see how that would be a massive improvement over the current system then nothing I can say can help you, you are a lost cause.
---------------------
The current system exposes producers to two costs, they must buy/rent land AND pay taxes.

Cost under current system = $1000 per month land rent + $1000 per month in taxes
---------------------
The land value tax eliminates one of those expenses entirely, because paying your taxes gives you land.

Cost under land value tax system = $1000 per month land taxes (paying taxes gives you land at no additional cost). In this case switching to land value taxation would cut producer costs in half.

 

As would be the case if we instituted a LVT.

 

No, I'm not aware. Land is defined as solid ground. They created solid ground where it was not solid before.

- - - Updated - - -

Funny how some people assign a moral value to some resource so they can justify imposing a state. Georgists pretend to be libertarian, but are as authoritarian and religious as any devotee of the holy state. In fact, they treat land almost like the socialist treats labor.

 

They are more dangerous than most authoritarians as they advocate ownership of all land by government.

 

Like most countries the US has both private and public lands- you often have to pay a small fee to visit public land, such as a state park.

I would prefer to see a tax when you sell your land, and the same land tax amount for everyone per year in that area to cover roads and utilities to the land- someone with 1,000 acres pays the same as someone with a quarter acre.

I like the way the US taxes higher incomes more- someone making 100,000 a year can afford to pay a higher tax, and give the person making 20,000 a year less tax to pay so they can better afford neccesities. The problem is all the loopholes the rich have added to the tax system with bribes (campaign donations or lobbyists)- very few very wealthy people pay the maximum tax rate, and many corporations get money back instead of paying any federal taxes (huge subsidies).

Tax reform never gets anywhere- the representatives doing the voting are usually the rich who would be losers if our tax system was more fair toward the poor and the middle class.

 

Nope. We just advocate shifting more of the burden of taxation onto landowner privilege so that producers can keep more of what they produce.

---------------------------

"In my opinion the least bad tax is the property tax on the unimproved value of land, the Henry George argument of many, many years ago."— Milton Friedman, Nobel laureate in Economics (1976)

"Another means of silently lessening the inequality of [landed] property is to exempt all from taxation below a certain point, and to tax the higher portions or property in geometrical progression as they rise." --Thomas Jefferson

"The fruits of the earth are a common heritage of all, to which each man has equal right." – Voltaire

"Both ground-rents and the ordinary rent of land are a species of revenue which the owner, in many cases, enjoys without any care or attention of his own. Though a part of this revenue should be taken from him in order to defray the expences of the state, no discouragement will thereby be given to any sort of industry.” – Adam Smith

"Men did not make the earth…. It is the value of the improvements only, and not the earth itself, that is individual property…. Every proprietor owes to the community a ground rent for the land which he holds." – Thomas Paine

"Why tax industry and enterprise at all—why not just charge rent? There would be no need to interfere with the private ownership of natural resources. Let a man own all of them he can get his hands on, and make as much out of them as he may, untaxed; but let him pay the community their annual rental value, determined simply by what other people would be willing to pay for the use of the same holdings.” – Albert J. Nock