The Marxist-vs-capitalist False Dichotomy

[HumanAction]

This wouldn't be the case.

At the moment in City I live there's a vibrant busking community spread around the place all competeing for the passing trade of shoppers in the area. As would be expected there are two or three hotspots that they all want because their advantageous location ensures a captive audience and the result is that sometimes two or three sets of buskers may congregate around the same spot, wasting time waiting for their opportunity to busk.

If we applied the land tax to this scenario the results would be very different. Lets say instead of encouraging them to fight over the resource each spot is allocated a price based on its value and at the end of each day the buskers shared out the money. There would be no advantage whatsover for holding a certain place away from somebody else and no ill feeling towards those buskers because they would receive no freebie for doing so. More time and energy can be spent on busking rather than standing around and the surplus energy could be spent on marginal spots which raise aggregate productivity.

The price of each spot (if it were to have a capitalsiation price) also drops significantly because of the way the market conditions have changed to stop unfair powers racking up to owners of certian locations.

The most interesting part of this is that both you and stars made an identical selective quote of my post.... Neither of you wanted to engage with the meat of what I wrote. Fascinating.

Regarding your post, I cant imagine why the busker with the best spot would want the arrangement you describe but I can see the appeal from the other buskers point of view.

[Stars]

Ahh I thoughgt you were trying to address the difficulties, that would be the part of my post you ignored , I should have realised you were just parroting dogma with no regard to reality.....

Your first point was that no amount could ever be enough to compensate

This is clearly false, the price itself would be enough to compensate

Your second point was the amount would not be enough to cover the price unless the government set the price

The price is not set by government, but the tax levied reflects the price land use exchanges for in the market

Edited September 9, 2009 by Stars

[HumanAction]

Your point was that no price could ever be enough to compensate

This is clearly false, the price itself would be enough to compensate

Your second point was the amount would not be enough to cover the price unless the government set the price

The price is not set by government, but the tax levied reflects the price land use exchanges for in the market

Simply saying I'm wrong is not very compelling. You chose not to quote the reasoned case made in support of what I said, presumably to avoid having to address it or acknowledge that it undermines the assertion you want to try and use as a refutation. If that represents the intellectual level that land tax advocates are at then it's a sad state indeed for you.

Edited September 9, 2009 by HumanAction

[Tob the Blether]

The elimination of taxes on work, trade and comerce is probably the simplest route, because it corners the government into collecting revenues the only other way it can. If workers got together and campaigned for taxes to be taken of their production, the government would have no choice but to tax corrrectly.

Aye there's the rub. Who will organise these workers? Who will agitate them? Who will decide what form the 'campaigning' will take? A charismatic leader, perhaps?

The word 'campaign' is surely a euphemism for....

passive resistance

strikes

civil unrest

riot

revolution

civil war

Surely it's nothing as innocuous as a letter writing campaign or online petitions.

[Authoritarian]

In reality of course the land holder will also incur costs and will likely want to receive a profit from the deal, all this will drive the cost way above what is received as any land tax dividend.

The land owner won't be able to profit from the deal because there would be no advantage gained from holding the location away from others as non owners would receive their equal share of financial benefits anyway. If the financial benefits from monopolising a certain location were £0 you would only be able to sell it on in the market place for this price.

Any costs the owner experiences would be costs that they imposed on themselves and so nobody else would be liable to meet those costs.

Edited September 9, 2009 by chefdave

[HumanAction]

The land owner won't be able to profit from the deal because there would be no advantage gained from holding the location away from others as non owners would receive their equal share of financial benefits anyway.

Any costs the owner experiences would be costs that they imposed on themselves and so nobody else would be liable to meet those costs.

You're still ignoring the fact that your system itself will incur costs.

LandTaxCollected = TotalDividendPaidOut + AdministrationCosts

Therefore;

LandTaxCollected > TotalDividendPaidOut

Obviously the dividend does not cover the cost of gaining access and never can unless you are invoking magical helpers to do the admin.

It ought to be obvious by now that, in fact, the land owner is in fact gaining an advantage and over time that advantage will grow.

Edited September 9, 2009 by HumanAction

[Stars]

You're still ignoring the fact that your system itself will incur costs.

LandTaxCollected = TotalDividendPaidOut + AdministrationCosts

Therefore;

LandTaxCollected > TotalDividendPaidOut

Obviously the dividend does not cover the cost of gaining access and never can unless you are invoking magical helpers to do the admin.

It ought to be obvious by now that, in fact, the land owner is in fact gaining an advantage and over time that advantage will grow.

Yes with CD implementation the funding of government is a seperate issue would most efficientlly and fairly done by charging a percentage of everyone's CD

We can then choose democratically how much of our cd should be used to fund government and how much we should get as CD to provide services for ourselves privately.

Edited September 9, 2009 by Stars

[Authoritarian]

You're still ignoring the fact that your system itself will incur costs.

LandTaxCollected = TotalDividendPaidOut + AdministrationCosts

Therefore;

LandTaxCollected > TotalDividendPaidOut

Obviously the dividend does not cover the cost of gaining access and never can unless you are invoking magical helpers to do the admin.

It ought to be obvious by now that, in fact, the land owner is in fact gaining an advantage and over time that advantage will grow.

Of course it includes costs. So any dividend that is paid out is done so after the costs of running any services that the public were prepared to pay for. This includes the fire service, police, schools etc. These things aren't free to run so if you want them then you have to pay for them, but they should be paid out of the land values which they help to create not taxes on work.

A massive problem with services such as the train service for example is that they're unable to claim back all the value they create because its outside their legal jurisdiction, this gives them the appearance of being cash strapped. This isn't so, its that the value they do create ends up as a freebie for local land and home owners which they then get to sell on as its impossible to bypass their monopoly. (This can be observed each time rail infrastructure is upgraded, its happening in the place where I live at the moment.)

If the market price of land was brought down to £0 then in theory anyone could afford it, because anyone can afford to pay £0.

Edited September 9, 2009 by chefdave

[HumanAction]

Yes with CD implementation the funding of government is a seperate issue would most efficientlly and fairly done by charging a percentage of everyone's CD

We can then choose democratically how much of our cd should be used to fund government and how much we should get as CD to provide services for ourselves privately.

The problem is that you need a central government for any land tax scheme and it's always going to be advantageous to gain exclusive access under any such system. Ultimately the tax collection and dividend distribution is never going to be free and is always going to result in small economic advantages to those who obtain exclusive access rights. I dont think it makes much difference if you term it a surcharge on the tax or a reduction in the dividend. Practically speaking they result in the same outcome, small advantages that over time compound into crushingly big advantages.

[Stars]

The problem is that you need a central government for any land tax scheme and it's always going to be advantageous to gain exclusive access under any such system.

Any such an theoretical advantage will appear in the price people will pay for it - but the price people will pay for it no longer goes to the owner and so the advantage cannot be collected by ownership.

[HumanAction]

Of course it includes costs. So any dividend that is paid out is done so after the costs of running any services that the public were prepared to pay for. This includes the fire service, police, schools etc. These things aren't free to run so if you want them then you have to pay for them, but they should be paid out of the land values which they help to create not taxes on work.

The result of all this is that the dividend can never actually be enough to pay for access. You are now looking for extra wealth just to gain basic shelter. Much like today. I wont even consider the inflation that will occur should government expand its spending. Thinking about it I'm getting deja vue.

A massive problem with services such as the train service for example is that they're unable to claim back all the value they create because its outside their legal jurisdiction, this gives them the appearance of being cash strapped. This isn't so, its that the value they do create ends up as a freebie for local land and home owners which they then get to sell on as its impossible to bypass their monopoly. (This can be observed each time rail infrastructure is upgraded, its happening in the place where I live at the moment.)

I'm sympathetic but there is no actual solution here.

If the market price of land was brought down to �0 then in theory anyone could afford it, because anyone can afford to pay �0.

If ifs and ands were pots and pans......

[HumanAction]

Any such an theoretical advantage will appear in the price people will pay for it - but the price people will pay for it no longer goes to the owner and so the advantage cannot be collected by ownership.

Indeed, it'll simply be collected by obtaining exclusive access instead. Functionally there is really no difference, they may as well own the land for all it will matter precisely because there is still an advantage to be had and over time that advantage can be used to obtain larger and larger advantages.

The thing you need to realise is that the advantages are not theoretical.

Edited September 9, 2009 by HumanAction

[Stars]

The result of all this is that the dividend can never actually be enough to pay for access.

Lets say, it can manage 80% with a small gov solution and no taxes on work

80% is better than 0%?

You are now looking for extra wealth just to gain basic shelter. Much like today. I wont even consider the inflation that will occur should government expand its spending. Thinking about it I'm getting deja vue.

The objective is not to help people to stop working entirely, but to make the rewards of work go to those who do the work

[Stars]

Indeed, it'll simply be collected by obtaining exclusive access instead.

The person who obtains exclusive access allways pays the current market price and so the advantage doesn't go to him

[Authoritarian]

The result of all this is that the dividend can never actually be enough to pay for access. You are now looking for extra wealth just to gain basic shelter. Much like today. I wont even consider the inflation that will occur should government expand its spending. Thinking about it I'm getting deja vue.

Government spending would be constrained because they would be limited to one type of revenue.

At the moment government thinks that they can tax you as much as you like to pay for services that you may or may not receive, this gives them more or less unlimited spending powers because they can force others to foot the bill.

If they were limitied to only spending a portion of land rents then they would have a steady supply of funds that were linked directly to the services that they offer, this means no more lesbian diversity officers and qunagos because the result would just be a waste of valuable and limited resources.

[HumanAction]

Lets say, it can manage 80% with a small gov solution and no taxes on work

80% is better than 0%?

Specious argument. Paying 20% of £1000 is worse that paying 100% of £100. The actual numbers are at least as important as percentages, as are the incomes involved.

The objective is not to help people to stop working entirely, but to make the rewards of work go to those who do the work

If that is the objective I dont think your solution has much chance of achieving it, the rewards will most likely go to those with exclusive land access because you have allowed them a constant small advantage. Probability is that simple and that brutal, you dont need a big advantage, a small one and time will do fine. Consider the effect the 0 has on the relationship between player and house at a roulette table.

[HumanAction]

The person who obtains exclusive access allways pays the current market price and so the advantage doesn't go to him

The market price moves further and further out of reach for all but those who have exclusive access rights. You are describing the manner of the advantage, not anything restraining it.

[Stars]

Specious argument. Paying 20% of £1000 is worse that paying 100% of £100. The actual numbers are at least as important as percentages, as are the incomes involved.

Actually what is important is the percentage

If the price of land is low, then the compensation doesn't need to be large.

[Stars]

The market price moves further and further out of reach for all but those who have exclusive access rights. You are describing the manner of the advantage, not anything restraining it.

80% of the price is always paid back to everyone else - so it can't

A tax on land acts to lower exchange prices and the total cost (tax +price) of ownership

[Harry Sacks]

What program would you implement to for us to get there from here? How can this be done without popular revolutionary action against property-owning vested interests? How would you deal with the forces of reaction?

My apologies, but I think this is just wrong.

Imo the money system is less relevant than is often assumed

Money is seen as the problem because everyone feels problems as a lack of money and so it seems to make sense to say 'the problem is money'. The thing is the problem is not really money, the actual problem is lack of access to your own liberty (land) which is caused by a high price of liberty (land), which is caused by speculation in the future price of liberty pushing the price higher than can be comfortably afforded by the productive. No matter how much money there was, this would always happen with our present tenure / tax system. By giving the price of liberty (land) back to everyone equally, we give everyone an equal measure of access to liberty as a human right and remove the incentive to raise its price with speculation.

Start by removing subsidies for land owners, taxing imported food and making available grants for small agricultural/rural diversity projects.

Tax land which is not used for some kind of production - the possibilities are endless. For example; two years ago a load of fire wood cost £50, now £85. There isn't enough to go around, yet trees are the best solar collectors and can grow in the worst soils. Land is idle while the owners collect SFP money.

Address the money system. Banks should have 100% reserve requirements. They cannot then use land to inflate the money supply. Residential mortgages alone account for 60% of new money creation. Inflation of the money supply against land have been promoted by governments as a way to shift responsibility for money creation toward individuals. Hence the disconnect between incomes and prices.

[Guest Steve Cook]

Indeed, it'll simply be collected by obtaining exclusive access instead. Functionally there is really no difference, they may as well own the land for all it will matter precisely because there is still an advantage to be had and over time that advantage can be used to obtain larger and larger advantages.

The thing you need to realise is that the advantages are not theoretical.

This is exactly it

[HumanAction]

80% of the price is always paid back to everyone else - so it can't

A tax on land acts to lower exchange prices and the total cost (tax +price) of ownership

Fairly obviously you are simply incorrect here, in a 'frictionless' system it might work the way you theorise but out in reality those with access will gain a little more of the new wealth generated than others simply because they have slight advantages. Over time wealth will be concentrated away from everyone else. Market price being effected by the bidding power of those in the market will move gradually further out of reach of anyone outside of the group with the advantage.

[HumanAction]

Actually what is important is the percentage

If the price of land is low, then the compensation doesn't need to be large.

You are making assumptions here that you have no grounds to make. Price could be high and compensation low for instance yet you take no account of what is not a particularly unlikely outcome.

[HumanAction]

Actually what is important is the percentage

If the price of land is low, then the compensation doesn't need to be large.

Your bland assertion is refuted by the very post you are replying to.......

[Authoritarian]

Start by removing subsidies for land owners...

This is what a land tax would achieve, a subsidy is just an extra payment for performing an activity that the market doesn't value and they come different forms, not just from the EU dictated CAP.

To completely remove landowners' subsidies without involving a land tax would either require full scale refusal to pay rent and mortgages or a national down tools which would cripple the economy. All the economic activity that takes place just gives current land owners a hidden subsidy for their 'service' of monopolising a factor of production.

It would be better to have some form of compomise so that people were able to work without having to subsidise land owners.

Edited September 9, 2009 by chefdave