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France plans to nationalize land


Dave Bloke

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I'm amazed that people think this is a bad idea- I'd have expected a forum that arose out of the membership of HPC would be chock full of Georgists.

A Land Value Tax is the best tax, both from a moral and an economic perspective.

From a moral standpoint, I think most people would agree that all citizens of a country should be born with the same rights as everyone else. That should mean that they are born with a right to a share of the land that country sits on. You clearly can't run a modern society where all land is shared; people need private space to build homes and business premises, and so the solution is easy- pay a bit of rent to everyone else in return for the state enforcing your right to exclusive use of a piece of land. You want a big house to yourself in the centre of London? OK, that'll be £100k a year please. Want to live in a block of flats in a former mining town, thereby sharing a small plot of not very valuable land with lots of other people? OK, £200 p/a each. Or probably less.

If you're born into a country where a small-ish proportion of the population own the vast majority of the land, and you have no choice but to pay rent to them just to exist, then you're not born free- you are, effectively, born a slave and forced to buy your freedom at a price the landowners set. I don't see how anyone can justify that, but feel free to have a go, I guess. And yes, I'm aware that the state demanding a land value tax for the same means you're not truly free either, but you never can be, and the burden would be equally shared and thus much less onerous for the vast majority of people.

And from an economic perspective, a Land Value Tax is the only tax that actually encourages economic growth rather than discouraging it. If land becomes something that accrues a tax liability, rather than a vehicle for speculation, then people are obliged to use it or lose it. Land banking simply wouldn't be an issue.

The conversation about planning permission in this thread so far has, it seems to me (though I read through quickly as I was keen to reply), largely missed the point. I don't think anyone is suggesting that we should have a free for all to build what you want where you want; nobody wants a pork fat rendering plant built next to their house, or thinks it reasonable that other people should have one built next to theirs. But as it stands, the state gives out planning permission, and gets almost nothing back. An acre of farmland worth £5k becomes worth, say, £1m once permission to build houses on it is granted. That gain accrues entirely to the landowner, and all it costs them is a planning application and maybe a few bungs to the local councillors. If you tax the value of the land at a percentage of its newly increased value, the gain (over time) accrues to the state, and by extension, every citizen. And in reverse, if permission is granted to build a factory that would make living in the vicinity of it slightly less desirable, then the decreased value of the land would be reflected in lower land value taxes, thereby compensating the people whose lives have arguably been blighted.

Another aspect is infrastructure. If the government builds something useful, Crossrail would be a good example, land/properties nearby gain in value. The gain accrues only to the landowner; the government is effectively spending money to benefit almost exclusively the people who already own land nearby. Tax that increase in value, and everybody gains. New infrastructure would largely fund itself.

There always seems to be an assumption that the Land Value Tax would be in addition to existing taxes. I consider myself a minarchist and a free marketeer; and I'd argue strongly that introducing LVT should not increase the tax take, just collect it differently. I'd use the money raised to lower or eliminate income tax, and especially VAT, which is a horrible, regressive tax. If you keep more of your wages and pay less when buying stuff you have a clear incentive to work and consume more, thereby driving productivity increases and economic growth. Or, if you're not big on consumerism and not fussed about living somewhere where land is in high demand, you'd be free to work less as the cost of putting a roof over your head would be dramatically lower, and the state would take less of what you earned.

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On 08/11/2019 at 21:43, dgul said:

Well, it's clear we've got a fundamental difference of opinion, but I'll make one more comment on the bold.

  • The way we buy housing is that land is effectively paid for on an ongoing basis, as it is paid (sure, 'one off cost') with a mortgage.

A mortgage is a long on margin so its even more speculative and hence less like rent/LVT than an outright initial purchase.

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14 minutes ago, Rave said:

I'm amazed that people think this is a bad idea- I'd have expected a forum that arose out of the membership of HPC would be chock full of Georgists..

The problem is that most peoples principals don't withstand exposure to a vested interest. Anyone who has already been gouged paying a fortune for a typical UK shoebox wont be queuing up to advocate  LVT or gorgism because they want their turn to gouge the next punter in line even more.

This is the biggest barrier to such reforms - its hard to corral a big enough body of people with the necessary moral fortitude.

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36 minutes ago, Tdog said:

Thats because the government are doing all they can to make house prices as expensive as can be.

And after a decade of ZIRP and the previous decade where interest rates should have been in double figures, you still want us plebs to be reliant on the government to do the right thing and set interest rates  higher ... when they are about to put them even lower. ... come on

I didnt suggest a free for all, i suggested a presumption of being allowed to build.

And as for overlooking each other, ffs look at the ever decreasing size of slave boxes clustered together in the UK thanks to the govts planning policies.

You have a strange trust in the government who work on behalf of landowners to do the right thing.

The government don't set interest rates any more, the Bank of England do.

I have no faith in either, and want a return to sensible lending and interest rates at their natural level, and for the demand to be decimated further by encouraging recent arrivals to be sent home. 

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1 minute ago, goldbug9999 said:

The problem is that most people principals don't withstand exposure to a vested interest. Anyone who has already been gouged paying a fortune for a typical UK shoebox wont be queuing up to advocate  LVT or gorgism because they want their turn to gouge the next punter in line even more.

Yes, true. I would also say that there is considerable merit to the argument that it's unfair to make sudden wholesale changes to taxation overnight, thus pulling the rug out from people who have quite reasonably arranged their affairs in their best interests under the previous regime. So I'd phase it in slowly, over a decade, say.

But at the end of the day, government doesn't create wealth, it only redistrubutes it, and any system of taxation and redistribution results in winners and losers. I'd like a system with fewer of both, and where rewards accrue to workers rather than rentiers.

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15 minutes ago, Rave said:

Yes, true. I would also say that there is considerable merit to the argument that it's unfair to make sudden wholesale changes to taxation overnight, thus pulling the rug out from people who have quite reasonably arranged their affairs in their best interests under the previous regime. So I'd phase it in slowly, over a decade, say.

In the long run everyone would be better off, even those we on paper lost value in their house. Imagine how much more vibrant the economy would be if everyone had say 10-20% more disposable income especially those on low incomes. 

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On 07/11/2019 at 17:54, One percent said:

They are coming for that last bit of wealth held by ordinary people. You can bet the farm that there will be loopholes for the rich. 
 

they will not be happy until we are all surfs again. 

Im sure that is in the pipeline

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On 07/11/2019 at 17:54, One percent said:

They are coming for that last bit of wealth held by ordinary people. You can bet the farm that there will be loopholes for the rich. 
 

they will not be happy until we are all surfs again. 

As I said in my post above, in fact you're already born a serf in this country if you're not born to parents wealthy enough to gift you some land, or the money to buy some. You're forced to pay rent to a landowner (or a bank) just to exist. I realize that it's counter-intuitive, but LVT makes you more free, not less.

There are still places in England where a house costs the same as, or even less than, it would cost to build it yourself from scratch. The value of the land it sits on is effectively zero, so under a properly implemented LVT you'd pay no tax on it. I do believe that there would be enough people who are prepared to pay a premium to live in desirable locations (the bigger cities, mainly, or nicer areas on the coast) that it would be fine to charge some people in the least desirable areas nothing. Or you could use the money from LVT to pay everyone a flat rate Citizens Income, which would be enough to cover the LVT in low value areas, so that it nets out to nothing.

As for there being loopholes...how? Another strength of the LVT is that it's near enough impossible to avoid. You can't hide a bit of land. If you pay no tax on your bit it gets seized and sold to someone who will. In fact I think that would be a pretty good mechanism for valuing the land for the purpose of implementing the tax- the government says that it thinks your land is worth X, so they want an annual LVT of, say, 5% of X. If you disagree you can turn around and say nope, I'll sell you the land for X instead. If more than a certain percentage of people in an area take that option up, then the government realizes their mistake and lowers their valuation. If nobody at all takes it up, they increase the valuation until someone does. Free market price discovery in action.

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1 hour ago, Tdog said:

Whilst i dont agree with the French proposal, as ive zero trust in the government or banks ... it would lead to political parties losing elections if the price of land went up.

Akin to the corn laws.

But the counter argument to mine that we should trust the BoE to put up interest rates or trust the LIBLABCON to come up with viable planning and tax policies is so naive its beyond ridiculous. Unless of course you've been in a coma since 1997.

I would trust the government to put interest rates up more than the globalists running the BoE with their quasi-independent status. It happened only 25 years ago, not that long at all, if Corbyn gets in then who knows what will happen at the BoE. They'll try to counter his mental economics with whatever they can - I can foresee 6% interest rates in the next couple of years personally.

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43 minutes ago, spunko said:

I would trust the government to put interest rates up more than the globalists running the BoE with their quasi-independent status. It happened only 25 years ago, not that long at all, if Corbyn gets in then who knows what will happen at the BoE. They'll try to counter his mental economics with whatever they can - I can foresee 6% interest rates in the next couple of years personally.

you're front running Durhamborns hypothesis now, his thread expects double digit interest rates into 2025-27? if i remember correctly. The stars are aligning then?

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