The same should apply to any other repeal of rent-seeking institutions: anti-labor-competitive laws privileging labor unions, licensure barriers privileging taxi medallion holders, etc.

The British used this method to end slavery throughout their empire, which meant: 1. much more rapid end to slavery, due to less political opposition to its abolition, 2. no costly civil war and enduring sociopolitical grievances that emanated from it.

Economic analyses indicate that compensating rent-seekers at an amount equal to the expected loss of economic utility over their lifetime from the elimination of their rent-seeking opportunity, as part of a reformation to end the institutions that enable their rent-seeking, leads to net economic gains, because the economic efficiency gains from expedited abolition of the rent-seeking far outweighs the cost of the compensation.

https://today.uconn.edu/2021/03/there-was-a-time-reparations...

Granted, it is hard to decide how to read this history. Specifically, the civil war did not start because the federal government tried freeing slaves; but because the eventual confederacy states feared it would. Abolition wouldn't become union policy until well into the civil war (largely due to the sunk cost of fighting the far). And, the 4 union slave states would eventually abolish slavery as well.

Still, given how costly the civil war was (both in terms of money, lives, and politics), it is worth considering the counterfactual where did a compensated abolition, which seems to have worked out better when it was attempted.

[0] The act to search for is District of Columbia Compensated Emancipation Act

One could bypass this problem by putting in limitations, like an requirement to be high-income before the tax is applicable. One could also limit land tax to specific zones outside of low density residential areas so it doesn't go into effect when the land owner and the person living there is the same person.

The article goes into the advantages of a land value tax over other types of tax, including a property tax:

The big question land value taxes help answer is: How can a government raise funds without distorting choices and possibly leaving people worse off? If you tax income, it provides a disincentive to work. If you tax property, it provides a disincentive to improve the physical buildings on top of the land. Sometimes the tax is intentionally disincentivizing an activity — think carbon taxes to reduce greenhouse gas emissions or so-called “sin taxes” on tobacco. But there are also taxes governments want to levy to pay for valuable services without changing behaviors too much (or at all).

>>The main argument that I see against land value taxes is that land doesn't generate any income by itself, which forces people to pay money in situation where they might not have any income to do so.

Those people should be selling their land. We should not have a scarce natural resource sitting idle or under-utilized. From the article as well:

In small towns, vacant lots contribute to decline — and if there’s no valuable structure on a property, its delinquent landlords likely only pay a nominal property tax. This both lowers tax revenue and hurts neighborhood quality for everyone else.

**

In Allentown, Pennsylvania, the system worked! According to a 2019 Strong Towns article, after the city adopted an LVT (through a split-rate system that still kept some property taxes in place) in 1996, “construction returned to the city: the number of taxable building permits surged past neighboring Bethlehem, market investment returned and capital improvement reappeared in city budgets. ... The losers in this trade were absentee owners of vacant lots, who had to shoulder much more of the burden.”

Sen. Pat Toomey (R-PA) is quoted touting the benefits of the tax: “The number of building permits in Allentown has increased by 32 percent from before we had a land tax.”*

If we have that attitude to people owning things, then the first thing should be wealth tax on jewelry, cars, boats, and other luxury items which if you can't afford to pay the tax then you should be forced to sell it. I remember how popular that concept where here in EU when refugees had their jewelry taken by the government in order to pay for expenses and basic living. People have this weird attachment to objects that defy rational thought.

I get the sentiment, but in term of winning popular support it has some distinct emotional drawbacks.

If we want to specifically address vacant lots within city boundaries, a tax on that seems fair. Not many low income home owners live in their property owned vacant lots located inside city boundaries.

That actually makes sense if you want to avoid price gouging and scalping over the short term.

If you tax wealth then people will try to reduce the amount of wealth they have which is undesirable over the long term. If you tax land, people will reduce the amount of land they use, which is exactly what you want in an urban environment.

Private ownership of the latter is both just, because the original owners comes to own it by producing it, and economically advantageous, because ownership incentivizes production, which leads to its supply increasing. With land, there is no moral justification for private ownership, as no private party created the land, and private ownership does not have the economic effect of leading to the supply of it expanding, since land cannot be produced.

Land cannot be produced but homes can be designed, constructed and built. If we want to tax land but not homes, and we want to tax gold but not jewelry, I would find that perfectly consistent. People rarely form attachment to unused land, similar to how people don't form attachment to solid gold bars or ingots. Incentivizes production of unused land and vacant properties is something I would support, while I am rather suspicious of taxing ownership of man-made resources.

>>a home is built on land which people form emotional attachments to

I would argue people should be encouraged to not form an emotional attachment to a house, because the land it occupies is part of a larger society which may come to need it more than the person does.

You may have grown up in a house your grandfather built, but the neighborhood of that house may have changed from a sparsely populated district of a small city, to the densely populated economic core of a major metropolis and regional shipping/trading hub. The land needs to be repurposed to benefit the greatest number of people, and I don't think a perpetual land claim stemming from the principle of first possession should trump that imperative.

I don't think the distinction being present are convinceing me. I can agree that undeveloped natural resources might need to be treated differently than developed resources, on that ground that undeveloped natural resources are inherently limited, scares and in general useless unless developed. Undeveloped land don't serve anyone except as an investment, and thus special rules might be needed.

I will also say that while I can agree that people should not form emotional attachments to objects, and I will include here any object, it is part of human behavior to do so. Be that a house, car, boat, jewelry, guitar, a sport players T-shirt, or what have you. For most people a house is just a house. For others it a family heirloom, built and maintained for hundred of years by the same family. We don't generally repurpose objects in order to benefit the greatest number of people, and I doubt there is a very strong support for that.

For practical purposes, gold is not finite for the time being. We can keep mining it to expand supply for a long time to come.

Maybe for some elements, it would make sense to apply a usage tax to discourage under-utilization of the existing supply, but that day hasn't come for gold.

>>You need land first and it need to be one of a few special locations on earth where such mining is profitable.

There are many places where one can purchase mining rights, and profitably mine gold. It's just a matter of investing the resources to do it.

Denmark had a law in place during the mass refugee crisis in Europe, where if a refugee owned valuables then they had to sell that first before they were allowed to receive government help. The idea was that people should first help themselves if they could, and by doing so helped the greater good since then the government could afford to help more people.

Ask people to sell their wedding rings and people get a bit upset, and so people compared it to Nazi Germany when they striped people of valuables. A lot of people wanted that the government should respect and thus protect peoples emotional attachments. Desperate people can't eat gold, and you don't want to force people to sell the last remaining object of emotional attachment that they own. I think even some refugees spoke on the news that they would rather die than sell off their heirlooms.

I think this would be an important component of a YIMBY or Georgist future, to have public open space and park resources owned and managed explicitly rather than implied on each parcel.

No, but we can have special provisions for public goods like parks. Outside of properties that generate these kinds of public goods, the revenue a property generates is generally a proxy for social good it does. For example, a condo building with 150 residential units and 10 commercial units on the ground floor will do more social good than a parking lot, and that is easily revealed by how much more revenue it generates.

LVT isn't about whether the land is developed or undeveloped. The idea is to tax it based on its maximally productive usage. So for example if a plot of land has a single house but it could fit an apartment building, it should have an apartment building.

Of course Central Park is a treasure! But based on LVT, open fields in the middle of Manhattan is not the maximally productive economic use for that land. Filling it with high rise apartments would yield far more economic value.

Clearly I'm not promoting that it would be a good idea. It would be a disaster. But it's a great example of why blindly applying LVT to everything is not a good idea.

I'm not sure this is true though. Manhattan wouldn't be close to what it is today without central park. It's not very hard to make the claim that central park provides more value than putting up apartment buildings would. Central Park makes that island some of the most expensive land in the world.

It certainly wouldn't and I wouldn't argue the contrary.

But from the perspective of analyzing LTV and its implications, how would that be written into the tax code formula?

Surely it'd be possible to take some of the Central Park area and convert to highrises without meaningfully diminishing the benefits of having a Central Park. But how much area would be ok to build to maximize economic value? 1%? 5%? 50%? 80%?

Because at the end of the day, a tax law needs rules and formulas to compute the tax, so how do those get defined in a way that preserves open space but pushes for highrise development everywhere else (if that's the goal)?

I think the way it would work is the government would have to pay LVT on land it owns, and people would have to decide whether the LVT would be worth more than the current use through elections. Sure, NYC could probably get $10 billion or so a year (who knows maybe its $100 billion) if they sold off central park while under this taxation scheme. I think hardly anyone would want that though, and NYC would just continue to pay itself the LVT instead of collecting the money from citizens that bought the park land. By the way this is a gross oversimplification since the LVT collected from the properties surrounding the park, and probably all of Manhattan if not NYC, would be drastically lowered if the park was developed.

> pushes for highrise development everywhere else (if that's the goal)?

I don't think this is the goal. The goal is efficient land use. That might mean high rise development instead of empty lots. It might mean national parks that people cherish. It might mean a great big park in the middle of manhattan. What matters is that the question "is this land being used optimally?" is being considered.

the land value tax is aimed squarely at taking economic rents of real property down to zero via taxation. in the ideal scenario, the land value tax would be exactly equal to the economic surplus (generated by poor policy or anything else) for each property, to negate the ability to extract economic rents, leaving only productive uses to generate income (perhaps in the form of a rent payment).

Tax has nothing to do with raising money. It’s about releasing real resources for the public good - largely people to provide public services. Ideally the tax needs to be incident on the private sector entities that would otherwise hire the people the public sector needs to hire instead - military, judiciary, police, healthcare, education, etc.

Government has no need of land, therefore it makes no sense to tax it. Expecting the incidence to end up in the correct place requires a faith in fungibility that just isn’t borne out in practice.

Taxation is entirely about raising money.

>>It’s about releasing real resources for the public good - largely people to provide public services.

What does "releasing real resources" mean, and how does taxation achieve that? And how does a land value tax fail to achieve that?

>>It’s about releasing real resources for the public good - largely people to provide public services.

I'm puzzled as to how you conceive of government not needing land, when many government services do in fact need it, or how you perceive other objects of taxation being needed by government in a way that land is not.

It isn't. Government has no need of it. Taxes are essentially shredded and deleted.

All very simple when you realise there isn't a fixed amount of money and it grows and shrinks as required by the economy.

What is spent and what is taxed are inductively connected, not directly connected. That's how we have 'deficits'. It's a function of the accounting.

"What does "releasing real resources" mean, and how does taxation achieve that?"

If you tax employment directly, private firms offer fewer jobs because there would be insufficient money in circulation to employ everybody (wages are insufficient to purchase output due to the tax take). The public sector then hires those who can no longer get jobs in the private sector.

The LVT fails to target the areas required, and it lacks a countercyclical behaviour. An employment tax, for example, collects more when the economy is hot and less when it is cooler. That's part of the automatic stabilisation mechanism.

"I'm puzzled as to how you conceive of government not needing land, when many government services do in fact need it"

Government is largely service based rather than goods based. What it needs is people.

Georgism is based upon a view of money that isn't actually the case. So it doesn't work.

That is not what happens to tax revenue. I recommend you look at a government budget, and see the source of much of the money spent.

>>If you tax employment directly, private firms offer fewer jobs because there would be insufficient money in circulation to employ everybody (wages are insufficient to purchase output due to the tax take). The public sector then hires those who can no longer get jobs in the private sector.

Private firms don't offer fewer jobs when you tax employment. They offer less for the jobs they offer when you tax employment.

Government can hire people because it can offer wages competitive with those provided by the private sector, and it can offer those wages because of the funds it acquires through taxation.

Governments have no need to tax employment to hire workers. This is trivially shown by jurisdictions with no taxes on employment and many government workers.

>>Government is largely service based rather than goods based. What it needs is people.

Abstractly, people need land, so government can trade access to land for services rendered for the public, i.e. for employment with the government.

I hope that it is interesting and noteworthy for you to learn that many, many smart and thoughtful economists do not agree with that. In fact, they strongly disagree.

Current thinking in modern economics - specifically in MMT[1] - is that money is created by loans and destroyed by taxes.

Which is to say, the government (provided it is a sovereign issuer of its own debts, like the US or the EU) has no particular use for revenues since they can just create whatever money they need. What is actually happening when money is taxed is that it is, effectively, destroyed.

[1] https://en.wikipedia.org/wiki/Modern_Monetary_Theory

Modern economists by and large do not subscribe to MMT. It has about as much support amongst academic economists as climate change denial.

Income tax has nothing to do with raising money. It’s about releasing real resources for the public good - largely people to provide public services. Ideally the tax needs to be incident on the private sector entities that would otherwise hire the people the public sector needs to hire instead - military, judiciary, police, healthcare, education, etc.

Government has no need of private income, therefore it makes no sense to tax it. Expecting the incidence to end up in the correct place requires a faith in fungibility that just isn’t borne out in practice.

When the government uses income taxes to fund public infrastructure like a subway, it improves the land that is incident to that subway which raises the value of that land. The government created a lot of private value that could be taxed to pay for the infrastructure it built. As it stands right now, the government just takes your income with no incentive to actually deliver as it does not benefit directly from its own investments. This allows corruption to creep in as politicians would rather fund massive boondoggles that line up their pockets rather than small incremental improvements that increase government revenue in proportion to how much value it provides.

This scene gets the point across very clearly: https://www.youtube.com/watch?v=XL3n59wC8kk&t=1803s

The government invests in the commons. Access to the commons (proximity to infrastructure) is owned by private individuals who benefit from the investment. The government does not benefit from the investment it made. It's effectively running a charity for a handful of people.

enact the tax gradually, say over 5 years, and the property market will adjust accordingly.

As for the moral argument, I find it hard to believe that individuals should know that the laws that society collectively agreed on and implemented, are unjust. To some extent we rely on society to inform us of right and wrong, and there is no clearer example of that expression than the laws and policies the government institutes through at the behest of elected representatives.

So I think the fault of unjust laws, where they exist, should fall on society as a whole, as opposed to those who as a matter of circumstance, just happened to make investments of time or money that depended on those laws.

Finally, not compensating landowners means far more political opposition to instituting such a tax, and therefore delays in doing so, and that in itself is costly. Consequently, insisting on landowners being punished for benefiting from the legal status of land ownership will be harmful to society. It would be a case of prioritizing vengeance over society's wellbeing.

certainly it means more political opposition in the form of money, but not in votes, which is the more pertinent metric.

That is not true. Greater incentives translates to more investment, and more investment is socially beneficial.

>>it's the same fallacious argument used to keep progressive taxes at bay (oh noes, the rich people will leave america for... ???).

There is nothing fallacious about this argument. Disincentives to investment lead to less investment. Less investment means less gains in productivity and wages, which also means less taxable income that can support the mandatorily funded safety net leftists support.

>>certainly it means more political opposition in the form of money, but not in votes, which is the more pertinent metric.

Historically, measures that threaten major special interests are difficult to pass due to the opposition they face. Ignoring that is putting ideology ahead of pragmatic results.

historically, disenfranchised masses revolt, violently.

bonus point: a more equitable distribution of wealth would lead to smarter investment overall and a more productive economy.

The percentage of income invested fluctuates, based on factors that include security of property rights and expected return on investment.

Creating a reliable regulatory and tax regime would mean greater annual inflow of money into investments.

>>historically, disenfranchised masses revolt, violently.

All the better then to remove the obstacles to the enfranchisement of the masses, by offering compensation to the current beneficiaries of rent-extracting institutions in exchange for recruiting them in the drive to abolish these institutions.

Violent revolutions that overturn power structures are actually quite rare and far more common is persistence of structural forces of rent-extraction for decades or centuries, and thus the threat of revolution is not an effective motivator for those in power to relinquish their privileges. The pragmatic reality is that we are more likely to get to a more just and efficient economy without these structures if we reach a settlement that removes the opposition of these structures' beneficiaries from the drive to eliminate them.

>>bonus point: a more equitable distribution of wealth would lead to smarter investment overall and a more productive economy.

Another bonus of eliminating rent-seeking institutions is that it reduces wealth inequality. Compensation to expedite the removal of a structural force that contributes to wealth inequality would likely be a net-gain for equity in the distribution of wealth, because the former is a one-time action while the latter has a recurring impact.

investors and politicians, on the other hand, like to say things like "investment will go away", but those are lies told to the susceptible to get pet policies enacted, not to reflect reality, better the economy, or improve the lives of ordinary citizens.

history books are literally chocked full of governments being overturned, and it's happened dozens of times in the past century. it's anything but rare.

These are proven economic prescriptions that expedite the removal of costly encumberences to increasing the efficiency of the market and reducing rent extraction by the few.

>>investment will happen regardless. the money literally has nowhere else to go.

You don't seem to understand the point I'm making. Some percentage of income is invested. That represents investment inflow, that leads to capital formation. The percentage varies between countries and eras, based on factors like the average ROI rate, tax/regulatory stability, and security of property.

It stands to reason that more tax/regulatory stability would lead to a larger percentage of income being invested.

>>investors and politicians, on the other hand, like to say things like "investment will go away", but those are lies told to the susceptible to get pet policies enacted, not to reflect reality, better the economy, or improve the lives of ordinary citizens.

You're allowing conspiracy theories to overwhelm your thinking. Your certainty in bad faith motivating these arguments is causing you to not even comprehend the arguments before you reject them, as in the case of you not making the minimal effort to understand my point about a variable rate of investment that's dependent on multiple factors.

>>history books are literally chocked full of governments being overturned, and it's happened dozens of times in the past century.

There have been hundreds of states in existence at any one time for the last several millennia. Many instances of a type of event does not imply that this event is common. The fact is, relative to how many states exist, and how large of a time period most historical analyses cover, the number of successful revolutions by the lower classes is very few, and thus the event is rare in the context how likely it is that it will occur in any one country in a given era.

Although again, the Georgist point is that this is specifically not true for land: the land is there whether you invest in it or not.

A Georgist would counter that land is special in this regard: unlike investment in productive enterprise, we don't actually need investment in land to create wealth. I think it's an open question whether markets would actually buy this designation, or see it as open season on all kinds of property. The latter would be very, very bad!

Eh, this is a fine line. If Henry had his way we'd have a 100% tax on land, which means unimproved land is now worthless since you can't make any profit off it. A true LVT tax is effectively the same as a seizure of your unimproved land, as its entire value has been collapsed.

less than roughly 1% of the land area of the US would have such pressures, so you'd have plenty of tax-free land to choose from, and it'd be cheaper to buy too. productive land should be put to its "highest and best use".

Important land is always unique, and therefore taxation would be have be incredibly dialed-in, no? A busy major international port would need to be taxed very differently than a sparsely attended beach just a mile away. This seems very difficult to get right.

Have there been practical applications that show that's not a concern?

you could imagine that the taxation is tied to the value of the land, which can be calculated as the rent income, minus the value of improvements upon the land (such as any buildings, which can be estimated by the cost of construction and maintenance over the useful life time, which is already a figure that is needed for depreciation purposes).

This is the reason why LVT cannot be passed onto the renter, because if you increase the rent, you would pay more taxes as the value of the land must have increased if the renter accepts this higher rent without any changes to the building.

Not everyone will likes that idea, but it shows that a non subjective solution exists, it and where there is one, there may be more.

Transitioning to a steep LVT is difficult because the assumption is that the LVT drops the value of the land if the yearly tax payment is too high. A $1 million dollar plot of land isn't supposed to pay $50k in taxes. The payment you are willing to make is say $10k per year which means the value of the land drops to $200k. Making that jump is extremely difficult. It's only really viable if you started with the LVT from the beginning.

The reason why Germany can transition to an LVT is because the property taxes it charges are laughably low to begin with. Around 200€ to 1000€ per year. There is no plan to increase taxes to lower the value of land and put pressure to solving the housing problem.

What's nice about looking at the improvements is we should always be able to figure out the cost to build the building initially, we can look at the repair costs.

Say we have a house that was just built. We know for sure that this cost $500k to construct. We have the bills. Make the market price of the lot and house cost $500k and the tax is perfect. Done. If the tax is above the correct value, the auction bid will be under $500k, that's bad! Lower the tax.

Now let's say it's 10 years later. There has been depreciation on the house. It's no longer worth the $500k. If we still tax the building as if its worth $500k, what happens? It turns out we under-tax the 100% LVT. But as we know, under-taxing is okay, not perfect, but okay. It's over-taxing that is harmful!

What happens if someone bids $600k for it? Now we know we are significantly under-taxing the area and have good reason to increase the tax, and send out an appraiser to look at it.

Lastly I just need to point out that in a LVT world, it is kinda going to be like the "Don't fight the Fed" line. If you know that bidding $600k on a $500k house is going to force a tax inspection, you might not be so happy to lose $100k, so you might bid less. You might even bid $500k simply because that's what the home is worth, you might fund the appraisal yourself so that you don't risk your $100k. As the speculation is driven out of the market, the values of homes will be much more steady than they are today, and land appraisal will therefore become much easier and uniform. Even Zillow could do appraisal's with a LVT.

I'm not fully clear on this statement. Is it putting forth that local governments shouldn't be controlled by the people who are local, or is it saying that homeowners hold more power than renters? If the former, that's just silly. If the latter, renters get the same one vote per person as everybody else. If they don't care enough to vote that's their problem.

Homeowners, like everybody else, vote in their own best interest. If you want higher-density housing figure out a way that it makes a place better for its inhabitants, not worse. Personally I've never lived in a city that got better as it got bigger and I vote accordingly.

There’s no inalienable right to live in a popular place you cannot afford.

Can you articulate an ethical argument for why it’s a problem that not everyone can afford to move to the most desirable cities?

Is it ethical for a select few to grow enormously wealthy by driving up the cost of living for the many by deliberately causing a shortage of a basic need?

People need jobs to live. They also need a roof over their heads. The jobs are becoming increasingly concentrated in a few metro areas, but the home-owning class constrains the supply of housing and drives up the price of their own assets. Disincentivizing this sort of rent seeking behavior is precisely the kind of thing property taxes accomplish.

There are two solutions to that problem. Governments could either make it easier to rent in the increasingly concentrated metro areas, or reverse the trend of increasingly concentrated metro areas.

During Covid there were quite a few government created incentives for remote work. If government started to use tax law to further incentivize remote home, maybe we can start to cut out all those officer workers from needing to live in metro areas, only keeping people tied to cities who need to physically be in the city.

I'm not saying people should stop living there, but stopping densification will not help curb climate change and sustainable environment.

Also, not everyone wants to live in non-dense places.

It also not clear if using existing numbers of rural living makes sense since most people do not work from home. If the norm is to travel to work, the further people live away from said employment the bigger the footprint will be. Existing numbers reflect that culture.

Looking at CO2 per capita, does the very high density cities of japan have better numbers than say India? No. Japan has 10 times higher than India. Of course we all likely know that that wealth influence emissions, which mean it not that simple to just say that concentrated metro areas are better for the environment than sprawl. Emission rates depend on multiple factors.

Prohibiting companies from hiring more than X employees? What keeps them from just setting up another company and hiring them as consultants?

Or is there going to be a fixed cap on the number of people who are permitted to be employed? If someone moves to the city, and it's already at it's max number of workers they're just prohibited from working?

Jobs becoming concentrated in certain hubs is natural emergent phenomenon. You're not going to legislate your way out of it, at least not without resorting to oppressive systems like hokou.

One option is building for remote work. Up the definition of "broadband" to include something people can actually use for work, and mandate that employees are allowed to work remotely, with full pay, unless employers can demonstrate the job cannot be done remotely. Workers who have to be local should either get the same tax break, or the company should have to pay those taxes instead. It might also require simplifying (or at least simplifying the administration of) state/local taxes. There are a lot of people, myself included, that live in dense areas for work rather than by choice. My hangup is that I want to live in a nice house, but don't want the risk of buying/building a nice house that I have to sell at a loss because I have to move for work.

Another option is to add population density as a factor on taxes. Raise taxes and then offer a discount for people in low population density areas. Or you could tie the discount to the median income.

Anecdata, but a lot of the people I know don't really want to live in urban areas so much as that they have to because of jobs. We either need to decouple workers from physical proximity, or force companies to disperse. The first option decouples workers, and the second incentivizes companies to disperse.

My government currently have tax reduction programs in place to enable people to commute to work. The same program could be applied to work from home, giving people tax reduction if they do not travel to work and thus lighten wear on the road system and reduces the pressure on mass transport systems.

In the transportation sector there could be government programs to further incentives technologies that enable direct-to-customer delivery. During the pandemic we saw how reducing crowded stores had some very positive effect on reduced transmission rates, how viruses other than covid also saw a strong reduction. It is possible also that by improving direct-to-customer delivery we end up with less waste, fewer middle men, and possible less impulsive purchases.

We don't need to impose quotas. Make it easier, cheaper and convenient to live outside of large cities and a lot of people will jump for the chance to do so.

Strange question to ask, given we've been seein the decentralization of jobs happening pretty strong for two years now. Jobs are remote now, wheneve possible, and people are moving to areas they want to live instead of being chained to the commute to an office.

That would require both negative interest rates and a land value tax because both are intended to neutralize liquidity preference. Negative interest rates prevent the build up of financial capital by overproducing "elites" which means people in rural areas will have those earning opportunities instead.

There’s no housing shortage.

There’s a limited supply in highly desirable locations because they’re highly desirable.

People can and do live elsewhere, working local jobs or commuting.

> The jobs are becoming increasingly concentrated in a few metro areas

That’s just one of many problems of scale; the solution is not to keep scaling up.

> … the home-owning class constrains the supply of housing and drives up the price of their own assets.

Nobody is obligated to destroy their own community to accommodate the interests of rent-seeking land developers and people who don’t live there.

Part of the reason is the lack of social housing provision, with most EU governments reducing or all together abandoning their post war commitments to low cost housing.

Another reason is that, even in this era of remote work, the enormous majority of high paying jobs do require living in a large population centre.

Perhaps the largest reason is the financialisation of housing as an asset class by hedge and other vulture funds. Italy alone seems to have kept the housing crisis / shortage localised to wealthy cities - and it is the only wealthy EU country to have done so. Germany, Ireland, France etc, all have rents and housing costs far higher than their median citizens capacity to comfortably pay, even in very remote and economically depressed areas.

Italy by contrast charges high taxes on 2nd and 3rd properties, effectively blocking the aggregation of empty / underused housing stock. Which has resulted in rural areas and less populous cities being reasonably priced to live in. This is not the case anywhere else in Western Europe.

Outside the west coast and parts of the northeast which are geographically limited in building new houses, we basically have infinite land to build housing which is why inflation adjusted price per square foot hasn't really changed in decades [1].

[0]: https://www.numbeo.com/property-investment/rankings_by_count...

[1]: https://www.supermoney.com/inflation-adjusted-home-prices/

Financialization of housing has had no negative impact on housing affordability in regions of the US, mostly in the South, that allow housing supply to grow, instead of constricting it with zoning restrictions. On the contrary, basic economic theory would dictate that more advanced financial markets that facilitate greater volumes of investment into housing would be good for housing affordability, by expanding housing supply, and by doing so, increase the number of units available for rent relative to people looking to rent.

Consider which city has the highest rental rates in the world: San Francisco. It has the most stringent restrictions on housing development, and housing use by owners, of any city in North America.

Inhibiting the market is what creates shortages, and housing is no exception.

We want housing to be commodified, and mass-produced by collections of profit-motivated individuals. Consider: construction has kept rent in Chongqing, China to $75 a month.

https://www.nytimes.com/2019/04/11/world/asia/chongqing-chin...

This is a great policy. Owning land you don't live on is perversity on the scale of deciding a patch of ocean is yours and shooting at any boat that crosses it.

_No_ economy can _sustain_ American style suburban growth.

Read about 'the growth ponzi scheme' [1] or watch a video

https://www.strongtowns.org/the-growth-ponzi-scheme

https://youtu.be/y_SXXTBypIg

Cities and states have no obligation to set urban policy in a way that is favorable to home owners -- a minority in most urban centers -- while frustrating the major economic benefit of cities. Growth and scale is what makes those places cool and what drives many of the benefits -- variety of restaurants, quality of goods, and so on -- that make them worth visiting and make them attractive to those who live in them. It is what makes them of value to the state and country. The idea that urban homeowners should be able to put brakes on the process is nuts; people who chose to own homes in significant or up-and-coming urban centers knew what they were getting into. It is just people trying to pull the ladder up after themselves, and this is not in the interest of most urban residents, of most people in any state, or of most people in the country. One does not have a "property right" to "the community just as it was when I got here".

That's literally what a shortage is. This is like saying, "there's no shortage of chips, people just need to buy less electronics."

> Nobody is obligated to destroy their own community to accommodate the interests of rent-seeking land developers and people who don’t live there.

The real rent-seeking behavior is curbing the supply of housing to drive up one's property values. "Rent-seeking behavior" is not very aptly named. A developer that builds a high rise apartment that rents to dozens of households is improving the use of land and expanding housing availability. A homeowner that keeps shooting down development proposals is not improving housing availability. The latter is the real rent-seeking behavior.

Not being able to buy a $100k car doesn’t mean there’s a car shortage, and not being able to buy a home in Boulder doesn’t mean there’s a housing shortage.

There’s plenty of housing.

Folks aren’t homeless for lack of affordable housing.

> The latter is the real rent-seeking behavior.

The propaganda coup of real-estate investors is astounding.

They have people like you advocating for their ability to extract rent in perpetuity as if it was a moral imperative.

Meanwhile, you think the individuals that own a home and enjoy being a part of their community are the bad actors.

It’s truly amazing what they’ve managed to convince people like you of.

It means there's a housing shortage in Boulder. The car analogy is not effective because a Camry does the exact same thing as a BMW. But a house in Oklahoma doesn't help you if your job is in Boulder.

Actually, it is very easy to have enough housing for everyone and yet make it impossible for everyone who could live in that area to actually live there.

https://youtu.be/724ZR1Za9BU

There is nothing wrong with wanting to keep a town smaller and more simple. If the residents were there first and exerted their way into the community they have that right.

I don’t really understand any other argument. There are lots of up and coming cities nowadays, you are free to live there, you are also free to be creative and make more money.

That's true both in a world of laws and in a world of power.

There's no right to anything that people don't stand together to say they have a right to.

> Can you articulate an ethical argument for why it’s a problem that not everyone can afford to move to the most desirable cities?

People shouldn't have to commute for hours so other people can live there because that impacts their health and opportunities for life, liberty, and the pursuit of happiness. If this is where the jobs are, there should be homes here as well.

This is ignoring the point: positive rights should not exist. They require taking rights from others, through violence, to enforce.

> People shouldn't have to commute for hours so other people can live there because that impacts their health and opportunities for life, liberty, and the pursuit of happiness

Ok. Then don't.

I’m confused by this statement. You don’t have an inalienable right to keep the area around your home exactly how you want it either. That’s a positive right and requires taking the rights of others, for example by enforcement of zoning laws that affect land owned by other people.

Negative right: nobody must do something to me.

The right of self-governance is a negative right. I can see how it can be confusing since you can re-phrase anything as either positive or a negative action e.g. "you must stop stealing my stuff so property is a positive right" and "you should not deny my need for healthcare ergo it's a negative right" so here is a trick you can use to distinguish one from another: a negative right will remain even in the absence of all other people while a positive right will disappear in such a case.

So, for this case, the right of self-governance will remain if everyone else disappears since you can still make laws, obey them and enforce them on yourself thus it's a negative right.

2) Property is delimited in scope. You own your parcel. You do not own the neighborhood, even partially. If someone else wants to put up dense housing on their parcels, their property, there is no negative-right violation against you. You are, at that point, just a rent-seeking highway robber.

> If someone else wants to put up dense housing on their parcels, their property, there is no negative-right violation against you.

That's another POV you are entitled to but the courts found otherwise in the Village of Euclid v. Ambler Realty Co.

My "faith" doesn't matter. The logic of the argument matters. And frankly, you don't seem to be putting forward very logical arguments.

>> If someone else wants to put up dense housing on their parcels, their property, there is no negative-right violation against you.

> That's another POV you are entitled to but the courts found otherwise in the Village of Euclid v. Ambler Realty Co.

That's not what the court found in that case. In that case, the court found that zoning was a valid extension of the authority of local governments. Local governments do not create negative-rights claims. Indeed, the zoning ordinance in question didn't even purport to do so.

Now, I've never been arguing that local governments lack the authority to pass zoning restrictions, even if I think some zoning is bad substantively. I've been arguing that you, as a private individual, do not have a negative right to make up your own personal zoning code and enforce it on others, without the democratic authority of the local government.

My argument here is entirely consistent with Euclid vs Amber, and frankly, your reference to the ruling is a non-sequitur.

What is your logic and do you have an example of a negative right, that doesn't require enforcement?

And I agree that as a private individual I don't have a right to deny construction wholly. Same as I don't have a right to elect anyone. The community has the entire right, I only have a right to vote.

No it isn’t. We allow the state to enforce it on our behalf. In most reasonable states, you can defend against the commission of a felony on your property with deadly force.

Also, owning property is not a right. That’s the entire point.

"I have the right to tell you what you can and can't build in my neighborhood."

Which one is positive and which is negative?

> Also the former does not exist in reality

Irrelevant, we're discussing how things should work not how they are.

This is really such a silly and pointless thread.

I agree. I was responding, in context, to the idea that people should be able to live wherever they want affordably.

I mean, it's an option, but a just society could easily do better.

The majority are screwed over by an ultra-rich minority, personally I think that deserves addressing.

Positive rights for all do not require violence provided those who benefit from others not having simple rights will give up their excess for the greater good. The demos may need to use violence, but that's only because those who, by no greater virtue, have acquired wealth refuse to act justly and recognise the equal dignity of man.

Or work near where you can afford to live? If there aren't jobs that support living there, live somewhere else? You're presenting an absurd dichotomy.

> The majority are screwed over by an ultra-rich minority, personally I think that deserves addressing.

No, they aren't. Wealth inequality is not a real problem. It's politicized jealousy. Wealth is not zero-sum, and someone having more than someone else is irrelevant.

> Positive rights for all do not require violence provided those who benefit from others not having simple rights will give up their excess for the greater good.

"Right" means it must be enforced. "provided .. will give up" means taking by that same force if they choose to not turn over what they own.

Taking to support a right absolutely requires violence.

> but that's only because those who, by no greater virtue, have acquired wealth refuse to act justly and recognise the equal dignity of man.

Why should they? What is their obligation? You have undoubtedly acquired more wealth than a subsistence farmer in rural India: why do you refuse to act justly and recognize their equal dignity?

And what happens when there's no jos where you live, and the only places where jobs exist have extreme housing shortages? You can spend hours commuting each day, but then you're probably burning just as much money through gas - not to mention destroying the environment.

Then you start a small business, employing others and building up your community. How do you think the ‘places where jobs exist’ started?

> the only places where jobs exist have extreme housing shortages?

If it’s intolerable to enough people, they won’t be able to hire. They’ll have to move, or pay more to overcome the housing shortage.

The fact that it isn’t, and they aren’t, shows this isn’t actually a problem.

The idea that anyone can just start a business is seriously indicative of how our of touch this forum can be.

What if there's no goods or services that are in demand in your immediate community? What if your community is impoverished and dying? What if you have no capital to start a business?

> How do you think the ‘places where jobs exist’ started?

Often it was because of natural resources, or geographic factors that made it conductive to establishing a population center (like river or harbour access).

> If it’s intolerable to enough people, they won’t be able to hire. They’ll have to move, or pay more to overcome the housing shortage.

The latter is what's happening: prices of housing are skyrocketing and locking people into poverty.

That assumes that's possible. I think the point being made is that it's often very much not possible.

There are serious problems with our built environment and this is one of them.

If there is demand for jobs locally and an economy to support it, they can start their own company.

If there is no economy to support it, then the community isn’t viable.

This is straightforward to understand, and not a problem to be solved. And certainly not one to be solved through stage violence.

That's like, your opinion man, and I don't know if you mean aspirationally, as in, there shouldn't be racist classist assholes out there so we shouldn't need positive rights to protect the dignity we all deserve, or you mean you so libertarian you side with the racist classist assholes like Ayn Rand, but surely if you meant to debate Kant and Shue: I wouldn't be the first to argue that a fundamental right to freedom is worthless if people aren't able to exercise that freedom, and you can just google search "criticisms of the virtue of selfishness" if you want; People write proper papers and thesis on this stuff, not internet comments.

So I still won't comment on whether positive rights should or should not exist, and instead say it is undignified to have to live in fear and that a lack of equity fosters fear, and ideologically I don't care how we do it, so I believe it ethical to support things like traffic laws, minimum-wage laws, health-and-safety laws especially in farms, restaurants and hotels, and maybe even a commuter-premium to prevent companies from exploiting another way humans are willing to degrade themselves.

Well, and the opinion of people that don't like slavery and theft.

> I don't know if you mean aspirationally, as in, there shouldn't be racist classist assholes out there so we shouldn't need positive rights to protect the dignity we all deserve

I mean positive rights cannot be established without evil. They should never exist, and any you can think of should be abolished.

> I wouldn't be the first to argue that a fundamental right to freedom is worthless if people aren't able to exercise that freedom

You don't need to take from others to be free. That is, in fact, the opposite of freedom.

> you can just google search "criticisms of the virtue of selfishness" if you want; People write proper papers and thesis on this stuff, not internet comments.

This isn't about selfishness. Well, kind of. Selfishness on the part of people demanding the positive rights, which _forces_ others under threat of violence to make their lives easier, regardless of whatever efforts they make on their own.

> So I still won't comment on whether positive rights should or should not exist

I maintain they should not.

> and instead say it is undignified to have to live in fear

So don't.

> and that a lack of equity fosters fear

Equity is impossible without violence and restrictions on freedom. It's not equitable that one person should be lame and another not: it only becomes equitable when we break the other person's legs.

> and ideologically I don't care how we do it

Neither did Mao, Stalin, or Pol Pot.

> so I believe it ethical to support things like traffic laws, minimum-wage laws, health-and-safety laws especially in farms, restaurants and hotels, and maybe even a commuter-premium

None of those things are rights.

> to prevent companies from exploiting another way humans are willing to degrade themselves.

If someone is willing to 'degrade themselves', why are you preventing them from doing so?

But irrelevant: Things have already taken from others and they want it back.

> Equity is impossible without violence and restrictions on freedom.

Agreed, so because violence was used to obtain an UN-equitable position, they want it back.

(I feel a little bit like I'm repeating myself; what's another way to say this?)

People the color of your skin used violence to take people with different skin-colors freedoms and property, and they used it to finance schools and police forces that resulting in you opportunities or advantages that other people with other skin-colors no longer had the possibility of as a result. You don't deserve that advantage, and so they want it back.

> I mean positive rights cannot be established without evil. They should never exist, and any you can think of should be abolished.

If "positive rights" can also be established in response to evil, then I don't see why they cannot be used to correct for equity. Property-rights are enforced by taxes, so on some level, if these are "positive rights" then they're just like a minimum-wage law designed to correct previous evils. Maybe one day they will not be necessary and can be abolished, but in the meantime, I think we need them and I support them in that aim.

> It's not equitable that one person should be lame and another not: it only becomes equitable when we break the other person's legs.

I think that's fair. Your parents poison them which makes it more likely for them to be born lame, so I think it's perfectly fair to break your legs if you can't find another way to make that right.

I'd like to think I'm just trying to find another way that doesn't involve more violence; surely an expansion of minimum-wage is less violent than breaking your legs?

> If someone is willing to 'degrade themselves', why are you preventing them from doing so?

Why do I tell a slave that they do not need to be a slave? Gosh, again, people write papers on this stuff. We tell people they don't need to be slaves because that's how we stop slavery -- by making it so nobody believes they need to be a slave in order to survive. The only rights we have are the ones we can convince other people we have. I already said this, but you chose to narrowly interpret rights which will make it hard to understand why I can't help myself: I don't want to be a slave, I don't know what kinds of torture I would be able to refuse, but I don't think that would be a life worth living, so I tell anyone who will listing they don't need to be a slave.

> Well, and the opinion of people that don't like slavery and theft.

And yet here is someone who does not like slavery or theft, who does not have that opinion because I'm not a racist asshole.

See how that works? Don't characterize me. I don't deserve to have my supporting of taxation to be equated with supporting theft just because you don't like to pay taxes, any more than you deserve to be equated with other racist assholes just because you're quoting racist assholes. You want me to take you seriously? You have to do the same.

Who took what, from who, when?

> Agreed, so because violence was used to obtain an UN-equitable position, they want it back.

Again: what, from who, when? There are two answers to this: something that isn't actually violence (agreeing to employment), or something from hundreds of years ago ('stolen land'). Neither are good arguments, in any way.

> People the color of your skin used violence ...

I'm brown. Want to try again? Maybe without criticizing someone's position based on their race?

> If "positive rights" can also be established in response to evil, then I don't see why they cannot be used to correct for equity.

I don't think you read that sentence correctly. Three things:

1) Positive rights should not exist, because: 2) Positive rights cannot exist without violence and slavery 3) Equity, and demands for it, are inherently evil.

> Property-rights are enforced by taxes

No, they aren't. Property rights are _usually_ enforced by the state, because of their monopoly on violence. There is nothing stopping me from defending my property myself.

> on some level, if these are "positive rights" ...

They aren't. As I explained.

> Your parents poison them which makes it more likely for them to be born lame, so I think it's perfectly fair to break your legs if you can't find another way to make that right.

Sins of the father, huh? Maybe we should punish out to 3 generations? Seems like you'd love the DPRK.

> Why do I tell a slave that they do not need to be a slave?

There are more slaves alive now than there have ever been in history. Someone working a minimum wage job in the US is very much not that, and it's patently absurd. Comparing a retail job to chattel slavery is disgusting.

> who does not have that opinion because I'm not a racist asshole.

Are you sure? You supported breaking my legs when you thought I was white. Now that you know I'm not, what now?

I mean, I know the answer: break them anyway, he's probably a counter-revolutionary.

This is exactly what's wrong with your entire philosophy. It's based on violence to get what you want, because you're incapable of achieving it any other way. Try harder.

> 1) Positive rights should not exist, because: 2) Positive rights cannot exist without violence and slavery

Violence exists regardless of whether "positive rights" exist. You are stating this again, but you haven't proven any kind of relationship beyond the tautological one.

I can't move on to the third point until you clear this up. Everything else seems like a distraction:

If we can agree that violence and slavery is bad, why can't we agree that some kind of retribution is required? Maybe this is why:

> something that isn't actually violence (agreeing to employment), or something from hundreds of years ago ('stolen land'). Neither are good arguments, in any way.

They're excellent arguments. Even agreeing to be "employed" for room-and-board in exchange for work could be slavery, especially if the person agreeing doesn't know if they have other choices. "Stolen land" was still stolen. What's the good reason for a statute-of-limitations on this?

I think you are dismissing these out-of-hand, and if you can't address them, maybe this is what is wrong with your entire philosophy?

> There is nothing stopping me from defending my property myself.

Of course there is. What are you going to use to defend your property besides violence?

It's impossible to have an informed discussion on this topic in the US without acknowledging that basic reality.

    Doesn’t that answer my question, then?
    
    There’s nothing inherently wrong if not everyone can afford to live in desirable cities.

teakettle42: How could one address AlotOfReading's concerns about exclusionary policy making and resource allocation?

I'm of the thinking that it is fine to say one subscribes to the belief that one can't simply live where one chooses for a variety of reasons, but it's another thing to condone, implicitly or otherwise, that only certain classes of people may live in desirable areas. I feel doing so is antithetical to a society that values social mobility.

What I _do_ feel is an under discussed thread of this topic are policies and practices that could be put in place to allow for a greater number of people to have an _opportunity_ to live in such areas. Low income housing, zoning changes, and tax incentives geared towards improving the socioeconomic diversity of an area are some approaches.

Unfortunately, none of these things are possible without local political support or overarching legislation/policy requiring it--bringing us full circle to Manuel_D's original comment.

This is just a subsidy for employers; they can pay a less-than-living wage, keep the profits, and rely on tax-payer-subsidized housing programs to close the gap.

> zoning changes

This is a give-away to developers.

Increases the entry costs for development beyond what anyone but huge real-estate investment firms can afford. They build out rental units, grow the permanent rental class, and extract rent from the population in perpetuity.

> tax incentives geared towards improving the socioeconomic diversity of an area

Why is socioeconomic diversity in coveted cities a desirable outcome, and specifically, why is it something the government should attempt to engineer using our tax dollars?

I agree, that's why single family households should have a higher property tax and high density a lower one. Currently single family households are subsidized.[1]

[1]: https://www.strongtowns.org/journal/2020/4/16/when-apartment...

Urban environments can’t be stamped onto cornfields; they only occur when sparser environments become expensive. I don’t think there’s a right to live in any arbitrary expensive town. I do think there’s a right to have the expensive-town-to-city pipeline running somewhere at more than a trickle, so that urbanism is not impossible to access.

Urbanism in a desirable location is expensive, everywhere in the world.

It’s an inescapable problem of scale.

You’re free to live like a sardine in a dense city, but it will be expensive. You cannot avoid that.

Actually it is because car centric design was associated with wealth and status that the “backwards” old ways became prohibited. This inversion now, where walkable environments seem to be luxurious, is a legacy of that prohibition more than anything else.

Now the question is whether one can show that the people are in a very general sense better off if a desirable city is affordable accessible compared to the alternative. I say “very general sense” because I want to avoid any argument that involves the minutiae of utilitarianism; it should be overwhelmingly in favor regardless of your exact ethical framework.

With that in mind, my argument would be that [cities should be affordable] is the obvious ethical choice if and only if the city in question is designed / planned in a pro-social manner. Where pro-social is defined such that the addition of new people is positive.

This should sound fairly tautological so let me give a few examples:

Pro-social design:

shops that rely on foot traffic are pro-social because adding more people (housing etc) to the immediate vicinity increases foot traffic

Mass transportation is pro-social because as more people are added to a particular neighborhood, this justifies expansion of train lines, bus routes, etc

Anti-social design:

Shops that rely on car traffic are usually anti-social because (a) adding people to other neighborhoods can still increase traffic to the shop, (b) removing parking space to add housing is a net negative to the shop (as parking capacity dictates shopping throughout)

Road systems are anti-social because adding more people to the system increases traffic at a nonlinear rate (ie: a road system at capacity decreases in throughput as more cars are added)

In other words, cities designed like cities benefit from more people, and thus everyone benefits from lower housing prices.

The kicker is, the United States doesn’t have a single city designed as a city. We have dense pro-social urban cores surrounded by anti-social suburbs and exurbs.

In contrast to a place like Tokyo where literally every resident has a bus or train (or combination thereof) to get downtown, America has split between two designs, and progressing along one design hurts anyone living in the other.

A noteworthy corollary is that if you live in a suburb or exurb (and are a homeowner protected from rent increases), property values going up to the moon are almost always positive, because your environment is anti-social in the first place. While in the city core it’s more complicated, because your property value going up raises your net worth but harms the pro-social environment around you.

There are zero inalienable rights

It's that the NIMBY subset of homeowners has disproportionate power in local government over other residents.

> If the former, that's just silly. If the latter, renters get the same one vote per person as everybody else. If they don't care enough to vote that's their problem.

This is facile -- zoning decisions are essentially never put up to a democratic vote. The outsized NIMBY power doesn't come from voting; it's from activities like attending local government functions, filing complaints, advocating to their representatives, etc. These are not things everyone has time or know-how to do.

Consider the question for states or countries. Would it make sense for Massachusetts residents to vote in Connecticut‘s elections? Or Canadian residents to vote in the US’s elections?

"Does it make sense that the people voting today can decide to stop other people from voting here in the future?"

That's what zoning, housing policy and other local government decisions are capable of doing.

Likewise, I don't want non-Americans living in Europe or elsewhere voting in state or federal elections because they might someday choose to become American citizens.

In both cases, those people might vote then end up never following through on their half of the commitment.

It's about whether the people currently living in X should be able to arrange things so that certain other groups of people will be impeded from living in X in the future.

There's clearly room for some debate there: most people would agree that nations can set their own standards for immigration and that these may exclude large classes of people.

However, if a town explicitly said "we do not want anyone who earns less than 400% of median household income to move here", I think that most people would find that at least a little troubling.

There really are not any mechanisms that would allow a US municipality to say that explicitly. However, things like zoning laws can be used to go fairly far in this direction in a more implicit way.

I think that's wrong.

If I live in Ward 10 of the city, why should the people of Ward 11 have any say in the by-laws for a neighbourhood that they don't live in? I'd argue because cohesive planning across neighbourhood boundaries is necessary for a healthy city.

The difference between your position and that of the grandparent is not one of fundamental principle. You're just at different places on a continuous scale.

They do. Residents of Massachusetts, Connecticut and other states all vote for President, Congressfolk and Senators.

For instance, Presidents, Senators, and Representatives are all Federal positions. The states (or for President, the state's electors) get to pick their own representatives, though, and it would be odd for one state to elect another state's representatives to Federal office (e.g. a Massachusetts vote being counted in the Connecticut US Senate election.)

Likewise, all counties in a state vote in State elections, but don't vote in each others' county elections. This goes down the line to cities within counties, districts within cities, etc.

Not that I disagree with your point (it's totally valid to point out that elections from multiple areas can all serve in one body), but I think the question was more about citizens from outside a region voting for policies/representatives within that region.

The municipality is a more or less arbitrary level of aggregation at which to make land use decisions.

aka, somebody else deciding that there should be more homes.

I think that's the wrong perspective to take. I don't want an authority to decide this - the locals should make their own choices (right or wrong).

But the flip side of that coin is local authorities that have zoning laws that allow the big and powerful builders to build pretty much whatever they want, wherever they want. Which always turns out to be high-rise condos for multi-millionaires and billionaires, most of whom have them as investment properties and don't actually live there.

You see that here in Austin, all along the river, especially downtown.

I wish we had some NIMBYism that we could actually aim at those plans for high-rise condos.

And without downtown, I don't know what your view or skyline would be of, other than an empty blue sky, of which 99.99% of Texas offers you that, if you want it.

Oh well, like you said, NIMBYism is certainly a thing.

The expensive single-family homes further up the river may take up a lot of horizontal space, but they don't ruin the skyline and since you have to dig down about as far as the building will be tall, they don't cause such massive damage to the natural surroundings.

Moreover, most of them are occupied. Most of the hi-rise condos are not occupied. They are pure empty investment properties from people who have more money than they know what to do with. If those condos came with a local residence requirement, then I'd feel a lot better about them being there.

That's normal. Median first-time homebuyer is 34, and that's for a starter house, which most people refuse to do nowadays.

I saved for a decade to buy my home in an area I enjoy, at a level of density I enjoy.

You can do the same, or you can choose to live somewhere cheaper that you can afford.

It’s your choice to live somewhere expensive, and to not want to save for a decade to get what you want.

It's obviously the case that local voters do not get "unchecked authority" over their local government. They can't vote to say that black people aren't allowed to live there, they can't vote to build an unregulated chemical factory, etc. The proposition that local voters should be allowed total control over zoning is defensible, but it's not a given.

The main real problem is FYIGM, which means that in a local area with all land used there's no incentive for those living there to vote to change how it is.

It may be, as in this case, that homeowners actively try to protect their asset by excluding non-homeowners from the market, perhaps by obstructing the construction of new houses, or by supporting the inflation of house prices. Is that a good situation just because it is sanctioned by a majority?

In liberal societies, there are side-constraints on what a demos can sanction - it cannot, for example, curtail the free speech of individuals. There is no reason why that should not be the case with respect to certain basic means of life, like housing.

It's based on population densities. Localities can designate industrial and commercial areas, but can't deviate from federal guidelines to prevent growth.

Instead of single family homes they allow triplexes where a percentage of space can be used for a low-impact business, like a barber shop or something. They have setbacks geared towards making sure that you don't build three stories on top of your neighbor's house.

They have neighborhoods. They don't have a housing shortage. They don't have a system that doesn't empower developers who want to clear-cut cheap land on the outskirts of town and build sprawling anti-social subdivisions of oversized identical houses.

Here's some more information: https://www.youtube.com/watch?v=wfm2xCKOCNk

This idea would be terrifying for most of the US homeowners.

> I'm not fully clear on this statement.

Me neither. It is a very often repeated sentiment and I've asked in various threads, but there has never been an explanation how homeowners supposedly have any kind of influence over local government, beyond the single vote everyone gets.

For the record, as a homeowner, I've never had any access to any local (or non-local) government representative. They don't ask what I think, they certainly don't seem to care what I think. I get one vote in the elections, but so does everyone in the county.

The life of a renter is completely different from that of a homeowner. Most renters are of a lower class, living paycheck to paycheck. All they think about is staying afloat, not getting involved in local politics. You need a surplus of time and energy, and roots, to get involved.

Comments like this ignore the conditions under which people live and how these conditions modify their behavior.

And your proposed alternative is?

Democracy has always been a dog and pony show where the interests of the rich and powerful are sublimated into a socially acceptable "war of ideals." Behind every issue, some group is playing power politics. Abortion, for example, isn't about the issue in itself, but about subverting traditional GOP values, thereby weakening their platform and making them look bad.

We must fundamentally alter human beings in order to avoid doomsday. In particular, we must suppress the life instinct which demmands continual growth or death. If everyone--not just workers-- could be made to be content with just sitting in their houses, the world would be saved.

It's not just directly voting for a city councilor, planning board member, etc. that counts. Showing up to public meetings to show support or disagreement with something can do much to pressure those elected officials. But renters are going to have a much more difficult time showing solidarity for pro-development action, not only because of the difference in socioeconomic status (e.g. living paycheck to paycheck vs. a homeowner who has a stable, white-collar job).

1. Homeowners can shoot down a proposed development by demonstrating a strong response against threats on just their street or block. As long as homeowners defend their turf locally, and it can be counted on them to do so across town, they win. Renters, on the other hand, have an asymmetrically difficult battle: pro-development individuals need to show up to all the proposed-development meetings, not just one for a particular street or block, if they want to expand housing.

2. Homeowners are probably much more strongly driven to show up because the focus is on what they lose. Character of neighborhood, traffic, safety, noise, etc. and the threat against the status quo seems more likely to trigger that visceral defense mechanism. Renters probably focus on what they gain: affordable housing, access to new communities, etc. My intuition is that the perception of losing something is a greater call to action than the possibility of gaining something.

3. Homeowners are well-defined and known individuals. They already exist, and their turf is already developed. Renters, on the other hand, are an abstract group of people who may or may not even move in, should something be built. I currently rent an apartment - but will I show up to a neighboring town's planning board meeting to voice my support for some proposed apartment complex that's still in the early stages, could flop at any point, and even if it succeeds I may not even move there? The renters of a future complex may not even know who they are yet, if they aren't adamant on moving in there should a place be built.

4. There's strong stigma against renters, to the point of being demeaning and tribal. A local council near me voiced their opposition to building more affordable developments, and the chairman said he was concerned about "derelicts" (exact word) moving in to the neighborhood and said if they built more affordable units, you'd see a rise in street drug vendors, threatening the local children. How can renters and low-income earners combat such ridiculous accusations when local leaders cast them as criminals, just because they can't afford to buy a median $400,000 house?

Your comment ignores so much of the asymmetric power dynamic between owners and renters.

It's not homeowners vs renters, it's homeowners vs property developers. Property developers who, I can assure you, are perfectly capable of sticking up for themselves.

> Homeowners are probably much more strongly driven to show up because the focus is on what they lose. Character of neighborhood, traffic, safety, noise, etc. and the threat against the status quo seems more likely to trigger that visceral defense mechanism.

Are these.. bad reasons to be opposed to development?

> Homeowners are well-defined and known individuals. They already exist, and their turf is already developed. Renters, on the other hand, are an abstract group of people who may or may not even move in, should something be built.

This is all the more reason to listen to homeowners vs renters.

> There's strong stigma against renters, to the point of being demeaning and tribal. A local council near me voiced their opposition to building more affordable developments, and the chairman said he was concerned about "derelicts" (exact word) moving in to the neighborhood and said if they built more affordable units, you'd see a rise in street drug vendors, threatening the local children.

Sleight of hand there. Renting != affordable housing. To be blunt, although maybe not as much as that councilman: poor people commit more street and petty crime. This is inarguable. Most people commit crimes near where they live. Also inarguable. He's not wrong.

I'd argue that current zoning laws and processes encourage large developers. They are the only ones who can navigate the system.

That's why so much new construction in the last several decades (at least) has been by large developers who buy cheap land on the outskirts of town, cut down all the trees, build a bunch of identical cheaply made houses isolated from everything else, sell them all at once, and hand over management to a homeowners association where rules are enforced to ensure conformity.

Not just those. For most home-owners, their homes are by far the highest-value assets they own, and especially given the lack of strong social safety net in the US, they often represent a large store of value that home-owners expect to be able to support them in retirement, in the event of unforeseen emergencies, etc. The thread of homes losing their value can be much more tangible than just fears about neighborhood character (and those aren't nothing).

Be that as it may, I think it's a problem with our system that homeowners are given such a strong incentive to keep housing scarce.

Well, that's not quite true -- there's many (highly paid) immigrants living in my building. None of them can vote on housing policy even though it directly affects their lives.

> Well, that's not quite true -- there's many (highly paid) immigrants living in my building.

But the variable there is immigration status, not homeownership status.

Non-citizen immigrants who are homeowners don't get a vote either.

1) Zoning laws have to change as well to actually allow development of the land being taxed toward more productive ends.

2) The land tax amount needs to be high enough that the pain of the tax effectively forces owners to improve what's on the land. A homeowner sitting on a million dollar piece of property in California taxed at ~1% is still unlikely to build an apartment complex if they like their single family home just fine and are making $200k+/year in income.

3) It could be personal bias, but a lot of LVT arguments seem to implicitly assume that more rental units is a good thing, which I don't really agree with. Personally, I'd rather see 2nd homes taxed into absolute oblivion, and I say that as someone who was a landlord for several years. Affordable housing to me means "affordable housing you can actually buy" as much as it means "affordable rent". The two do not go hand-in-hand if rental income is incentivized enough that people buy as many properties as they can get loans for (California today).

This is addressed to some extent, with the argument that zoning reforms are more practical because existing property owners are incentivized to support rather than fight zoning updates that allow more development, so they can fully maximize the ratio of their revenue against the tax. (“It turns NIMBYs into YIMBYs,” she quotes a researcher as saying.)

For the past few decades a large percentage of new housing has been built by large developers who buy cheap land just outside of town, clear cut it, then build a bunch of cheaply made identical houses in complexes with nothing else allowed, leaving behind an HOA to enforce conformity. The laws encourage these large developers, and sprawl. It's too much overhead for an individual or a small developer to build in an established neighborhood, especially if they are not building expensive housing.

Even lately hedgefunds and other large investors have been buying up housing at a greater rate, because they know the supply has been restricted by law. They'll squeeze everyone they can for money and lobby to keep their gravy train going.

Now those giant corporations are finally paying their damn taxes.

The house you 'own', in fact is nothing more than tenancy. Just a different kind of tenancy. Stop paying property taxes and find out you still have a landlord.

I think far bigger issue is how to apply LVT. a cookie-cutter approach is guaranteed to fail. an overly complex system is just another byzantine labyrinth of a tax code that'll be gamed.

California needs a constitutional convention that gets rid of the stupid proposition law. Every random suburban town has a market worse than Manhattan because there is a fundamentally inequitable tax system.

3) LVT would (theoretically) equally encourage the development of condos as it would rental units.

This is a personal bias because you are trying to prevent other people from making their own decision on how they want to live. An uncharitable interpretation of your comment could be that you are forcing your will upon other people against their will.

The fact that an LVT increases personal freedom is usually ignored because personal freedom counts for nothing these days. I find it particularly amusing that we have this group of people called liberals wanting their fake freedom.

It’s one of the reasons banks and companies aren’t in the single family rental business.

The main thing that covers for it is property appreciation - the rent is used to just offset carrying costs while you wait for the property to go up in value.

Source: been doing this spreadsheet exercise for more than a decade. Have never found a property I could buy and rent out at a profit.

If you can find one, you often find that they'd rather let the property sit empty than renting it.

Or just look at the cost of buying a house vs renting a similar house, account for maintenance, and see if the numbers line up.

Anecdotally, I know people who buy single family homes and rent them for profit. My 3 bed, 2 bath single-family home has a $3,000/monthly mortgage, I could easily rent it for more than $3,500 (closer to $4,000). Take out 10% for maintenance fees, and I net $200 a month.

In other words, you could not make a profit.

You need to consider all costs, not just mortgage. Taxes, insurance, maintenance, repairs, downtime (when it sits empty between renters).

If your mortgage is $3000 and you can only rent it for less than $4000, you can't make a profit.

I go through this math often while daydreaming of renting my house and retiring somewhere cheaper. There isn't any scenario I can come up with where it would actually be profitable.

Even if you only count the downpayment, $2400 a year on $90k is a 2.6% return; you therefore are getting the majority of your return from appreciation.

To actually make a profit on the rental portion, you need to discount the appreciation. You can do this if you're paying into a mortgage from 20 years ago and renting at todays prices, but that's just ignoring the fact that you could sell the property.

The biggest risk that most small landlords don't account for is a bad tenant - they exist and they will quickly eat through your $200/net a month.

The final proof is no company anywhere is building single-family rentals. If there was money to be made there, they would; but you need to get to apartments and the cost-savings inherent in them before it makes sense.

And yes, I’ll agree that some portion of the ROI on a house is the expected appreciation, but we’ve setup a system where that’s effectively guaranteed in many locations and simultaneously unavailable to renters. There’s a reason “be a landlord” is now the go-to “get rich” strategy for a large number of people.

I've been a landlord of a non-mortgaged property and am about to become one again (reluctantly). We charge a below market rental rate, and typically make around 4-6% (pretax) of the nominal property value a year (we typically divert 1-2% of the rent into a maintainance fund).

I would also getting the increased equity in the house as each mortgage payment lowers the total loan amount.

If you pocket 500 per month, you are looking at around 35 years to break even on a $200k down payment.

You will never break even when take into account opportunity cost compared to a low appreciation bond or stock.

Not sure your definition of break even. After 30 years, I will have paid off the entire house.

https://i.redd.it/f0kl4a40cl861.jpg

The reason why liquidity preference exists is that land can be used for almost anything, is limited in supply and going up in value, making an early commitment can lose you a lot of potential profit. For example, a 10 year lease to a farmer could turn out to be a bad decision if 3 years into the lease, a power utility offers to build wind turbines on the land and you are still stuck with 7 years on that lease. The power company moves on and you lost your opportunity.

It turns out, a land value tax neutralizes liquidity preference.

That count?

https://www.nytimes.com/2020/03/04/magazine/wall-street-land...

> Today, built-to-rent homes make up just over 6% of new homes built in the U.S. every year, according to Hunter Housing Economics, a real estate consulting firm, which projects the number of these homes built annually will double by 2024. The country’s largest home builders are planning for that future. Backed by banks and private investment firms, they have already bet billions on the sector, and will put down some $40 billion more during the next 18 months, Brad Hunter, founder of Hunter Housing Economics, projects. Built-to-rent subdivisions have been constructed or are under development in nearly 30 states. Taylor Morrison Home Corp. , Mr. Wood’s development partner and the nation’s fifth-largest builder, has said built-to-rent could soon become 50% of its total business. The company didn’t disclose the current share.

> Homeownership is expected to decline over the next two decades—a trend that started with the generation after the baby boomers, according to the Urban Institute, a Washington, D.C., think tank that advocates for homeownership. Prices are rising faster than ever, leaving more people, including those with higher incomes, more likely to rent.

You tax the carbon. That tax money is then put into an account. At the end of the year, every single individual is then given an equal share. The disincentives the use of carbon, while at the same time providing means that a majority of people actually get a net benefit.

The land tax should be set so that the price of the house becomes just the price of the house - the cost of the materials and labor. The land value should drop to zero. You then take that money, maybe use some of it for some public goods, might use some of it to get rid of bad taxes like property, income and sales, then give the rest back just as with the carbon tax.

The transition needs to be done with care(I heavily like giving everyone tax credits equal to the current value of their land, others like phasing in the tax over decades), but once we are in a land value tax environment everyone will be better off.

How is that even possible? The root cause of property values being high in specific areas is because demand is high. Without changing demand, I don't see how it can just be labor and materials, especially since the buyer will be paying land value tax as well (since it's not a condo, high rise apartments, etc).

I find proposals to reduce land value close to $0 extreme. After all, it would require some absurd tax rate like 100000% land value tax. The value of the land is 2k€ at 100% LVT representing the maximum in taxes one would pay for the property. At 100000% the payment is still 2k€ but the value of the land is now 2€ and you are paying 1000x on top of that land value in land value taxes. This means you can purchase the land for very little upfront. However, a 100% LVT would be more than sufficient because people can easily afford to prepay one year of taxes.

The most optimal result, the result that we call 100% LVT(although 101% is much worse than 99%, so we try to aim cautiously) - is if the new market price after a LVT is implemented is $500k. Maybe that means a $24000/year tax. Maybe it means more. We keep raising the tax until the sale price asymptotes at the value of the improvements. Let's say it ends up at $24000/year. $24000/year is the value of the positive externalities that is being captured by this property, and we are therefore taxing the entirety of it.

It might help to also show you the lot next to it[0]. It's totally unimproved. It's going for $2 million. The goal for the land value tax is if the new sale price of that lot is $0. You'll note that if you try to do some math of current sale price to get some tax percent, you can't ever really get to zero. It would need to be an infinite percent tax. But that's because the tax is not based on the market price, but a set amount based on the lot. Because we know the lot next door is exactly the same size, and we know this lot is verrry very slightly closer to a train line, and we can see the general trend of the city is that lots closer to the train are worth more, so this lot based on some algorithm might be $24005/year, and we confirm that when someone buys it for $0. If someone bids thousands of dollars for it, next year we adjust the tax on it slightly up.

[0]: https://www.zillow.com/homedetails/736-Hyde-St-San-Francisco...

It's the exact same thing in reverse with interest rates over time. As mortgage interest rates drop, the monthly payment is what people look at, so home prices go up.

As the land value will always be zero, there is little value in holding land that you are not using productively, so speculation will drop heavily.

You say all this as if there isn't any meaningful supply-and-demand to be had in the secondary market.

But you seem to be agreeing with my point that it inherently is designed to affect choices (eg changing land usage to be more productive).

It’s also politically difficult to get passed. However, it seems if we were to try to turn the tide on just one policy, it would be LVT, as it solves a lot of other political problems downstream.

Having had many many bad landlords of single family homes in the past, I'd prefer somebody like Blackrock as a land lord as they are less slokey and more likely to follow the law then a lot of landlords I've been forced to deal with.

Of course it will distort choices and leave some people worse off. If the author can't see that, then they have a serious bias problem. The whole point of the land value tax is to tax land to encourage higher density and higher cost use. This is especially damaging to people who hold land that is developed around. If I have .75 acres with a single family home and 30 years later the area around me is developed, them I will be financially forced off of my land because I could theoretically put an apartment building on it. We already see standard property tax forcing the elderly out of their homes in many areas.

Please, show me how an appropriately set income tax disincentivizes work. I'm guessing they can't and are equally uneducated on that subject. Income tax would only provide a disincentive to work if the alternative (assistance programs) is more attractive. Which doesn't seem to be the case. The people at that lowest level of income aren't paying (or gets refunded) income tax. Most of the tax at that level on income is for programs like social security and Medicare.

Under our current system we subsidize low value land uses by subsidizing the crap out of infrastructure to expansions of suburban areas zoned for single family homes.

https://www.youtube.com/watch?v=7Nw6qyyrTeI

The only revenue positive portion of nearly any modern american city/town are the few sparse walkable mixed use neighbourhoods and the dense urban core. Policies like a land value tax that push for higher value land uses are necessary to stave off the oncoming wave of municipal bankruptcies America faces.

> Income tax would only provide a disincentive to work if the alternative (assistance programs) is more attractive.

You are thinking in absolute terms and not on the margins. If the marginal income tax beyond a threshold jumps by %10, then even discounting the increasingly marginal value of each additional dollar earned I will value the return on work less when I hit that tax threshold.

Even then most places rely on state and federal grants to make ends meet. Do you have have any examples of cities actually net positive without outside funds?

"You are thinking in absolute terms and not on the margins."

I think my position still stands. The claim was that people would not work because income is taxed. What you describe is reduction in work incentive when you hit the next bracket. I'm saying that in order to not work you would have to value the support systems more than making any income.

And of course, most people are no where near the level income that they don't want to make more. We're pretty talking about the 1% ($600k), or maybe the top 5% ($240k). So not particularly useful for designing policy for the other 95-99%. In fact, it could be beneficial for those high earners to drop out and allow new people to take their place.