RE: [LandCafe] Re: Semantics and welfare - formerly legitimate LVT criticism
“On Harry's view, so long as each individual monopolist is paying his/her fair share for exclusive ownership, it doesn't matter that some people will (or at least may) go with nothing.”
1.Where did I say that?
I never mentioned “fair share”. Each individual owner is paying exactly the advantage he gains from his location, that’s all - though you have made him a monopolist. However, let’s say he doesn’t own it. Instead, he gets “security of tenure” which Roy – and probably you – admit is necessary for the person using the land. Neither of you say what the practical difference is between ownership and security of tenure.
2. On the other hand who does own the land if not privately owned.? The State? Does Roy or you envisage nationalization?
Or perhaps he assumes that no land is owned. But then who grants security of tenure? I suppose real estate people will continue to handle property transactions. Perhaps they will only handle improvements and pass across to a new owner a piece of paper showing the transfer of land. That the piece of paper is a deed of ownership doesn’t appear to make much difference.
Then, Walter, you add:
“it doesn't matter that some people will (or at least may) go with nothing. "See," Harry says "Each owner is paying just what he ought!" But then he derives from that, "So nobody is hurt."
You say that this conclusion doesn’t follow. Seems to me that arguments against the effectiveness of full collection mostly consist of statements that somehow liberty and justice have been thwarted. How this is so is not developed, in Roy’s case he congratulates himself for proving something and that’s all.
You complain about my “rosy predictions” of the economic development that would occur with full rent collection. Yet those economic consequences are the major reason for collecting full ground rent. As you allude, I enjoyed making the point that “Better to collect rent and throw it in the sea than not collect it at all.”
This because the economic consequences of full rent collection carry us toward the goal of Liberty and Justice for all. Any rent revenue is a bonus. This list tends to concentrate on revenue and, understandably, on the best means of getting it. This is a land-value taxation list. Yet, my reason for becoming a Georgist and remaining so all the years is certainly not because I favor a better way of getting revenue. It is because full rent collection was George’s elegant way to handle the problem he exposed.
“But suppose Harry's pipe dream were to come true and the economy would absolutely SOAR! Would it then follow that nobody is hurt if each owner pays the full shot in LVT?”
“Sadly, still the answer is no. It just doesn't follow that all compensation to non-owners will have been made even if every owner is made to pay his fair share.”
3. What other compensation is needed, and for what?
And please, don’t use “fair share”. It’s his complete payment for what he gets.
The rent of a location is the advantage it gets compared with the margin which is said to be “the best available rent-free land”.
Under modern conditions there is no margin – no free land. All land is held privately or by government bodies. So those at the bottom of the wage pyramid are pressed down by monopoly rents (which I name rack-rents) to subsistence levels. At the bottom levels are those that have interchangeable jobs – such as janitors, short-order cooks, waitresses, cab drivers, and so on. They live from pay-check to pay-check. The truly unfortunates below them are proper candidates for charity.
Although for all practical purposes all land is owned, it isn’t all used. Large amounts of even the most valuable land in cities is unused or underused and mostly held for speculation in rising land-values. The effect of collecting the full rent will change that. Much, or most, of this land will be dumped on the market. Central city land – the most desirable – will be snapped up by the best producers and over time most people will have happily moved toward the center where the best jobs are, where services are concentrated, and and where commuting is less. Some land at the outskirts of the city is likely to be vacant and rent-free. Certainly it will be available to the lowest wage earners, some of whom may well become smallholders and make a better wage. (Roy jeered at the thought of them trying to compete with large farms, but they do this already in local Farmers’ street markets.) Fresh tomatoes, zucchini, Brussels, and so on, have good sales now in these street markets. Also hydroponic tanks are easy to set up and produce well and plentifully. However just some will go in this direction. When rent collection opens up good high rent land, the demand for labor will be high and wages will rise.
This is from where Georgists are coming, but not from where Roy is coming.
He thinks that when full collection of rent happens there will be little effect on monopoly rents – my rack-rents. The lowest workers will still be earning at subsistence rates, will still be unable to get out of the hole they are in. This is where we differ and this is why he has come up with the exemption.
On 2/28 Roy answered my:
> You can always pay rent because the location provides you with the means to pay it.
“No, that claim is blatantly and indisputably false. The location does not provide you with either the labor or the capital to pay the rent. That is very much the point: everyone who can't provide the labor and capital needed to use the location to its full potential is forcibly deprived of the liberty to use it -- liberty they would otherwise have.”
I can’t understand this argument at all. The exemption will get him land at (say) half price but it doesn’t provide “labor and capital” so what’s the difference? With the Georgist analysis labor should be able to get marginal land for nothing. That’s a start.
Of course, Roy cannot understand that marginal land (best rent-free land) can be productive. Well, if the result of full collection does not release large amounts of land from speculative hold-out – as he thinks – this is so. Marginal land will be the worst of the worst. But, again, full collection will spring loose a lot of land which is far better than the present margin and lead to higher wages..
Harry Pollard writes: ..."in beginning no-one had more right to natural resources than another."
To which Roy Langston replies:
"The only way to acquire more right to natural resources than another remains to make just compensation to all whom you deprive of them."
And, in a nutshell, there lies the dispute between the two of you regarding the UIE. On Harry's view, so long as each individual monopolist is paying his/her fair share for exclusive ownership, it doesn't matter that some people will (or at least may) go with nothing. "See," Harry says "Each owner is paying just what he ought!" But then he derives from that, "So nobody is hurt."
The thing is, that conclusion doesn't follow. When this is pointed out, Harry turns to extremely rosy predictions about the economic development which he believes simply must occur if land speculation becomes impossible. Those predictions seem wishful thinking to some extent--though certainly the elimination of taxes on productivity would only help (if the LVT proceeds, instead of being thrown into the sea will replace them). But suppose Harry's pipe dream were to come true and the economy would absolutely SOAR! Would it then follow that nobody is hurt if each owner pays the full shot in LVT?
Sadly, still the answer is no. It just doesn't follow that all compensation to non-owners will have been made even if every owner is made to pay his fair share. This is a point that has been made to him over and over and over again by Roy and others. But as it is inconsistent with Henry George's canonization, Harry will not acknowledge it, but simply repeats that if full rent recovery is made (i) every owner will be paying his/her fair share, and sometimes adds (ii) the economy will SOAR. Around and around they go.
Ich habe genug.
- --- In LandCafe@yahoogroups.com, "Harry Pollard" <harrypollard@...> wrote:
> HP > Let's not pursue this. Ownership in a full rent collection economy is fine and harms no-one.Very simply: a geoist economy will likely distribute exclusive tenure more widely (i.e., a larger fraction of the population will end up as direct landholders). But if people OWN land in a Georgist economy, they have a very good reason to VOTE AGAINST that Georgist economy, thus voting themselves a privilege of pocketing "their" land's rent.
> RL: Not so. Once it is conceded that land is owned as the fruits of one's
> labor are owned, how does one justify taxing one and not the other?
> In a Georgist economy, how on earth does ownership of land harm anyone, whereas "security of tenure", which you favor, doesn't?
It is going to be monumentally difficult to implement a geoist economy. In fact, it may be the most difficult task that will ever be accomplished by human beings. It is therefore crucial that the implementation make it even more difficult to undo than it is to do.
> You apparently seeOTC, because it so resembles leasehold tenure, I don't see how one can honestly call secure, exclusive land tenure in a geoist economy "ownership."
> no practical difference between security of tenure and ownership.
> Neither the "fruits" nor land should be taxed. However, in a GeorgistIt's true that unlike income tax or other taxes, land rent recovery is a voluntary, market-based, value-for-value transaction. It is the only possible way government can be made self-financing. But all that claiming "it's not a tax" will get is a popular perception of disingenuousness.
> economy, if your location benefits from the surrounding community, you will
> pay that advantage back to them. This isn't a tax. It's a fee - you pay for what you get.
-- Roy Langston