One of the biggest uses of public land is for transportation. Since transportation is used directly or indirectly by everyone, there is usually a public policy to subsidize transportation. Usually people don't think of this subsidy, unless they are talking about mass transit: the subsidy to transit is mentioned, while the subsidy to private automobiles is ignored. Some of the examples of subsidy to private automobiles are: the land used for roads and parking is not taxed; the pollution and congestion that automobiles cause is not paid for by the motorist, but by the population in general, whether they so pollute or not; the tax on new cars (at least here in NC) is less than the tax paid on other items.
Another large subsidy to automobiles is mandated parking: a person who wants to build a house or business must provide parking, usually for the worst case that that business or house would need. This ensures that many businesses do not open and many houses are not built, because the owner or builder doesn't have the land available to provide it, or cannot afford to provide the $15,000 or so per parking space that a parking deck would cost. Those who do provide this mandated parking simply add that cost to the cost of their product, so that everyone who patronizes that business or buys that house, has the cost of parking added to their bill, whether they use the parking or not. This ensures that people will drive even if they could walk, bike, car-pool, or take transit, because they perceive that driving is so cheap. This in-turn creates more demand for street widening, and subsidized parking.
So the question is: whose parking do you want to pay for? If we have mandated parking requirements for businesses or residential units, this will mean that you will pay for everyone's parking, whether you use it or not. Worse than that, mandated parking means that housing is less affordable, because the price of a parking space is included in the unit, whether the person needs it or not. The has a disastrous effect on people of lower income, who see the cost of housing increase as more requirements are put on housing.
Donald Shoup has written extensively on this topic; he has spoken here in Raleigh and his talk is available here.
Thursday, April 23, 2009
Saturday, February 21, 2009
The Jubilee
One of the most interesting concepts of the Bible is that of the Jubilee. It's an event that happens every fifty years, and is found in the book of Leviticus Chapter 25. The chapter expresses a concern, not about "Law", but about People, especially those who are apt to be taken advantage of. Two main points are Freedom for Slaves, and return of Land to its original owners. These two concepts are related. The person who has control over the land that another person works, or lives on, has partial control over that person; a partial slavery. The idea is that Land is very different from selling the work of our labor for several reasons: Land is a Gift from God, and Land is Forever. The Jubilee is, in effect, a kind of continual land reform. Land is not a commodity that can be bought and sold. It is an inherent right of all people. Interesting that this concept is several thousand years old, yet has been mostly ignored in the living out of religious values.
Land Value Taxation is a way of accomplishing this continual Land Reform, by making sure that all people have a share of the land, or its income. The Jubilee also warns us against thinking that we can abuse our environment: the land is to rest every seven years.
Land Value Taxation is a way of accomplishing this continual Land Reform, by making sure that all people have a share of the land, or its income. The Jubilee also warns us against thinking that we can abuse our environment: the land is to rest every seven years.
Sunday, January 25, 2009
What is the goal of (Landsharing, Geonomics, Land Value Taxation) ?
The purpose of shifting taxes from taxes on buildings, wages, sales, to a tax on land, is to give all people an equal share of the earth's land or the rental income from that.
One way to think of it is that there are two pies.
One pie consists of all the land in the world, in the sense of all natural opportunities, including land, air, water, radio spectrum. The land has a rental value. This rental value for land, for example, can be found out by seeing what someone is willing to pay for a given parcel of land. This is often done with long-term leases. Air has a social cost which is the cost to battle the effects of pollution of that air. This "pie" is a gift of God/Nature which belongs to everyone in the world. If someone uses more than their share, they are indebted to the rest of humankind for that use. If we collected all the rent in an area (precinct, city, county, country) and divided and distributed it to all the permanent residents of that area, that would satisfy that debt. One effect of this tax or land rent collection would be to encourage frugal use of land, leaving more for others and for Nature to rejuvenate itself and protect our environment. It also allows communities to set up parks and beaches for the recreation of all.
The other pie represents what humans produce. Examples would be a worker's labor, a doctor's services, the production and showing of a movie, food. This "pie" is due to the individual's or organization's efforts and should not be taxed or divided. It takes nothing away from the common good. It does not need to be taxed. This encourages all people to work efficiently.
The folly of Socialism and Communism is that they try to divide both pies, taking away incentive to work. To the extent that democratic governments tax wages, buildings, and other work, they also destroy incentive to work. To the extent that governments leave land untaxed, they encourage land speculation and they encourage attempts to acquire more land than we need, leaving less for those who need it.
This does not have to be done in the whole world or entire country at once. Many cities in this country and others have instituted a two-tier real estate tax, whereby land is taxed at a higher rate than buildings. Examples are Pittsburgh, Pennsylvania, and Sydney, Australia. The result has been an increase in economic activity and the presence of more affordable housing. See: http://www.progress.org/geonomy/geono05.php
One way to think of it is that there are two pies.
One pie consists of all the land in the world, in the sense of all natural opportunities, including land, air, water, radio spectrum. The land has a rental value. This rental value for land, for example, can be found out by seeing what someone is willing to pay for a given parcel of land. This is often done with long-term leases. Air has a social cost which is the cost to battle the effects of pollution of that air. This "pie" is a gift of God/Nature which belongs to everyone in the world. If someone uses more than their share, they are indebted to the rest of humankind for that use. If we collected all the rent in an area (precinct, city, county, country) and divided and distributed it to all the permanent residents of that area, that would satisfy that debt. One effect of this tax or land rent collection would be to encourage frugal use of land, leaving more for others and for Nature to rejuvenate itself and protect our environment. It also allows communities to set up parks and beaches for the recreation of all.
The other pie represents what humans produce. Examples would be a worker's labor, a doctor's services, the production and showing of a movie, food. This "pie" is due to the individual's or organization's efforts and should not be taxed or divided. It takes nothing away from the common good. It does not need to be taxed. This encourages all people to work efficiently.
The folly of Socialism and Communism is that they try to divide both pies, taking away incentive to work. To the extent that democratic governments tax wages, buildings, and other work, they also destroy incentive to work. To the extent that governments leave land untaxed, they encourage land speculation and they encourage attempts to acquire more land than we need, leaving less for those who need it.
This does not have to be done in the whole world or entire country at once. Many cities in this country and others have instituted a two-tier real estate tax, whereby land is taxed at a higher rate than buildings. Examples are Pittsburgh, Pennsylvania, and Sydney, Australia. The result has been an increase in economic activity and the presence of more affordable housing. See: http://www.progress.org/geonomy/geono05.php
Saturday, January 17, 2009
Social Cost
One of the concepts that we need to understand is that of social cost, that is the cost of certain activities that is born not born by the person doing the activity, but by the public in general, particularly the public in the area where the activity take place. An example of this would be the cost of pollution, which is often not born by the polluter, but by those who live in the area, especially people who are most exposed to the pollution.
One way to discourage this is by shifting taxes from being based on what people earn, spend, or have, to being based on what we pollute. Sometimes these are called green taxes, Pigovian; an example would be a carbon tax.
A land tax is an example of a green tax. It discourages buying land only for speculative purposes, since those who don't use it by building on it, or employing people one it, would have to pay more tax that what they do now. That means that taxes could be lowered on those who do use the land by building and/or employing. Land tax is also green because it encourages frugal use of land, resulting in compact growth, which means that more trips are walkable, bike-able, or would require shorter driving or transit trips.
Some other sites which advocate for Land Value Tax rather than Tax on Work are:
http://www.savingcommunities.org/
http://www.henrygeorge.org/
http://www.landreform.org/
One way to discourage this is by shifting taxes from being based on what people earn, spend, or have, to being based on what we pollute. Sometimes these are called green taxes, Pigovian; an example would be a carbon tax.
A land tax is an example of a green tax. It discourages buying land only for speculative purposes, since those who don't use it by building on it, or employing people one it, would have to pay more tax that what they do now. That means that taxes could be lowered on those who do use the land by building and/or employing. Land tax is also green because it encourages frugal use of land, resulting in compact growth, which means that more trips are walkable, bike-able, or would require shorter driving or transit trips.
Some other sites which advocate for Land Value Tax rather than Tax on Work are:
http://www.savingcommunities.org/
http://www.henrygeorge.org/
http://www.landreform.org/
Saturday, January 10, 2009
Introduction
Since we are somewhere in a recession, maybe the beginning, maybe the middle, maybe the end, it's important that we try to find out what is going wrong. Most people say it's the lack of regulation of the banking and financial markets that have allowed a few to profit at the expense of the many.
I believe that the problem is that we don't differentiate between the wealth that we've earned (the fruits of our work) and the wealth that God/Nature has given us as a society.
Some others have done a lot of work in this regard and you can find their efforts online at:
http://www.progress.org
http://www.whatwouldjesustax.com/
http://www.wealthandwant.com
We know that if something is taxed, it will be reduced: if we tax beer, beer sales will go down. In the same way if we tax work, wages and employment will go down.
If we tax land, the amount of land does not go down, but the demand for it will go down, because only those who want to use it will buy it, land speculators will not want it. If that happens, the purchase price of land will go down, by the law of supply and demand. The purchase price goes down because speculators (those who believe they can profit from the ride up the bubble) don't bid up the price so high.
This makes housing more affordable.
Untaxing work means that workers' wages are higher and that employers are motivated to create more jobs.
(to be continued)
I believe that the problem is that we don't differentiate between the wealth that we've earned (the fruits of our work) and the wealth that God/Nature has given us as a society.
Some others have done a lot of work in this regard and you can find their efforts online at:
http://www.progress.org
http://www.whatwouldjesustax.com/
http://www.wealthandwant.com
We know that if something is taxed, it will be reduced: if we tax beer, beer sales will go down. In the same way if we tax work, wages and employment will go down.
If we tax land, the amount of land does not go down, but the demand for it will go down, because only those who want to use it will buy it, land speculators will not want it. If that happens, the purchase price of land will go down, by the law of supply and demand. The purchase price goes down because speculators (those who believe they can profit from the ride up the bubble) don't bid up the price so high.
This makes housing more affordable.
Untaxing work means that workers' wages are higher and that employers are motivated to create more jobs.
(to be continued)
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