That was an interesting piece. I never dived much into Georgism before so it was nice to get an overview.
In your view, what are the strongest rebuttals? The logic seems sound, but it also has a lot of assumptions, and I wonder if the empirical expectations implied by his thinking consistently line up with what we see in reality.
I think the strongest argument against Georgism is that in the places where LVT have been implemented, even at modest rates, tax revolts have been effective in getting rid of it. Its pretty fragile to democracy, since people love to vote themselves a free lunch.
Some people point to issues with assessing land values but those seem like more substantial arguments at first glance than they actually end up being, in my opinion.
Otherwise the empirical evidence lines up with theory pretty well. George's theory of interest is dismissed by modern scholars. And wages haven't fallen as much he predicted, but only because they're buoyed by the modern welfare state. He also didn't foresee the way the automobile would, as he would call it "extend the margin of production".
When you can more easily travel, then the amount of "useful" land is increased. The automobile/highway system was another "frontier expansion" in a sense, which reduced the monopoly power of land holders, but that frontier is closing now, which is part of why we're now seeing the same problems they were facing in George's time.
The electoral distaste for LVT is the biggest hurdle I think. Even if you could properly explain the benefits of such a tax, and show that the average person is better off by moving taxation to land rather than income, It wouldn't work. There is such a large issue with the 'vibes' and also the immense influence on public discourse large land-owners can employ to push public opinion against it, that I think LVT as a policy is simply not worth pursuing.
People who are fans of LVT should instead focus their energy on building a suite of policies and strategies to have Georgist style approach to taxation fused into the existing policies. This is necessarily a lot harder, but also a lot more realistic. I would say It is next to impossible to introduce a large, broad LVT - but it is not unrealistic to incrementally and slightly change many different other taxes and parts of the welfare state to shift a higher burden of taxation onto land rents, and reduce the profitability of hoarding unproductive land without ever actually introducing a LVT.
What these policies look like depends on what the current policies are in place, and therefore instantly makes the whole exercise very granular and difficult/unsexy to talk about because It immediately excludes global audiences/foreign/distant observers who aren't already familiar with local policies. Talking about philosophy and grand ideas of LVT is of course a lot easier, but will probably get you no where to actually seeing it implemented.
LVT has the enormous advantage of not needing any national level changes though. You can implement split-rate tax regimes on a local or county level provided the state allows it. This makes it much easier to do than trying to make changes to the national tax structure
Yes indeed and pushing the needle to get local government taxes to more heavily tax land and less improvements is an admirable cause for anyone concerned with LVT. It's really one of the most absurd things in the whole discourse really. If a State or National Government tried to implement an LVT, you'd hear an uproar about how 'you don't really own anything', and the Government is trying to 'make you pay rent indefinitely for something you already own'. Of course, everyone already pays a tax like this anyway to their local Government, and it would much easier and simpler to just tweak how local Governments charge their taxes than it would to embark on large tax reform.
There are many other creative ways State and National Governments could change tax policy to focus more on implicit taxation of land without ever going near an LVT, but that's when you get into specific jurisdictional policy discussions and can get bogged down in unsexy details.
I don't think we should give up on broad tax shift to LVT, but I think that's a very long term goal. Like probably not in my lifetime. I do think it will actually require a shift in public consciousness around property rights. But I don't think that's impossible. It's just hard and unpredictable and chaotic.
In the mean time, I agree, we should look at all sorts of policies that get us closer and not be dogmatic and revolutionary. Work with whoever in common goals. Make small improvements.
That was an interesting piece. I never dived much into Georgism before so it was nice to get an overview.
In your view, what are the strongest rebuttals? The logic seems sound, but it also has a lot of assumptions, and I wonder if the empirical expectations implied by his thinking consistently line up with what we see in reality.
I think the strongest argument against Georgism is that in the places where LVT have been implemented, even at modest rates, tax revolts have been effective in getting rid of it. Its pretty fragile to democracy, since people love to vote themselves a free lunch.
Some people point to issues with assessing land values but those seem like more substantial arguments at first glance than they actually end up being, in my opinion.
Otherwise the empirical evidence lines up with theory pretty well. George's theory of interest is dismissed by modern scholars. And wages haven't fallen as much he predicted, but only because they're buoyed by the modern welfare state. He also didn't foresee the way the automobile would, as he would call it "extend the margin of production".
When you can more easily travel, then the amount of "useful" land is increased. The automobile/highway system was another "frontier expansion" in a sense, which reduced the monopoly power of land holders, but that frontier is closing now, which is part of why we're now seeing the same problems they were facing in George's time.
The electoral distaste for LVT is the biggest hurdle I think. Even if you could properly explain the benefits of such a tax, and show that the average person is better off by moving taxation to land rather than income, It wouldn't work. There is such a large issue with the 'vibes' and also the immense influence on public discourse large land-owners can employ to push public opinion against it, that I think LVT as a policy is simply not worth pursuing.
People who are fans of LVT should instead focus their energy on building a suite of policies and strategies to have Georgist style approach to taxation fused into the existing policies. This is necessarily a lot harder, but also a lot more realistic. I would say It is next to impossible to introduce a large, broad LVT - but it is not unrealistic to incrementally and slightly change many different other taxes and parts of the welfare state to shift a higher burden of taxation onto land rents, and reduce the profitability of hoarding unproductive land without ever actually introducing a LVT.
What these policies look like depends on what the current policies are in place, and therefore instantly makes the whole exercise very granular and difficult/unsexy to talk about because It immediately excludes global audiences/foreign/distant observers who aren't already familiar with local policies. Talking about philosophy and grand ideas of LVT is of course a lot easier, but will probably get you no where to actually seeing it implemented.
LVT has the enormous advantage of not needing any national level changes though. You can implement split-rate tax regimes on a local or county level provided the state allows it. This makes it much easier to do than trying to make changes to the national tax structure
Yes indeed and pushing the needle to get local government taxes to more heavily tax land and less improvements is an admirable cause for anyone concerned with LVT. It's really one of the most absurd things in the whole discourse really. If a State or National Government tried to implement an LVT, you'd hear an uproar about how 'you don't really own anything', and the Government is trying to 'make you pay rent indefinitely for something you already own'. Of course, everyone already pays a tax like this anyway to their local Government, and it would much easier and simpler to just tweak how local Governments charge their taxes than it would to embark on large tax reform.
There are many other creative ways State and National Governments could change tax policy to focus more on implicit taxation of land without ever going near an LVT, but that's when you get into specific jurisdictional policy discussions and can get bogged down in unsexy details.
I don't think we should give up on broad tax shift to LVT, but I think that's a very long term goal. Like probably not in my lifetime. I do think it will actually require a shift in public consciousness around property rights. But I don't think that's impossible. It's just hard and unpredictable and chaotic.
In the mean time, I agree, we should look at all sorts of policies that get us closer and not be dogmatic and revolutionary. Work with whoever in common goals. Make small improvements.