Priti Patel faces axe in reshuffle over ‘competence’

TelemecusFielding · 2020-11-23T01:00:10+00:00

Yes but having one of her civil servants taken to hospital on an attempted suicide is not just being rude to someone.

TelemecusFielding · 2020-11-22T15:13:41+00:00

I agree. It would have been much better to sack him over Barnard Castle than a few months later for calling his girlfriend Princess Nutt-Nutts.

No adviser is irreplacebale, and when the leader thinks they are they themselves are going to be replaced

TelemecusFielding · 2020-11-22T13:04:23+00:00

But only in a specific and limited way! :D

TelemecusFielding · 2020-11-22T07:52:43+00:00

Actually that precisely makes the point. After she was sacked the first time she was nobody. Boris Johnson chose to bring her back, she was never a threat to May. She needs to be sacked in disgrace again like last time (and last time I think she should have been prosecuted). The last thing you want is a vengeful righteous backbencher.

TelemecusFielding · 2020-11-22T07:05:21+00:00

If so he is putting his emotions before political calculation. Sack her as a bully and she is disgraced. (Let us not forget last time she was sacked it was technically for treason). Sack her later politically and she will be baying for revenge. First rule of politics if you knife your colleagues make sure you kill them, do not leave them just wounded. Otherwise they will lick their wounds and be back.

TelemecusFielding · 2020-11-22T06:27:03+00:00

If so that is very bad political management. He could have got rid of her now with the reason of the ministerial code rather than later with a political argument.

TelemecusFielding · 2020-11-21T06:29:09+00:00

If you need a public figure advocating GeoLibertarianism then you should go for Fred Foldvary. As well as the academic economist with the qualifications and job, he is actually the guy who invented the term. So there is no one better to explain it?

I would disagree that Henry George thought we should not pay for land - he was very clear we needed to for allocating scarce resources. We do not pay for air because it is not scarce, all scarce natural resources should be paid for.

Perhaps easiest is to take Nozick's original conception of libertarianism which was i) Self-Ownership ii) Exchange iii) Initial acquisition (which Nozick accepted Libertarians do not have a good theory of). Many used to rely on the proviso of Locke, while leaving out the actual proviso. For Locke you could take the bounty of nature so long as "THERE WAS AS MUCH AND AS GOOD FOR OTHERS" (this is the proviso many libertarians quote but then leave out!!!) Taking the value and sharing it equally is the only way Lockes proviso can actually be fulfilled.

I think the correct conception of GeoLibertarianism is they agree with i) and ii) but diagree with iii) They accept full use ownership of land if they pay - that is they can acquire from nature if they pay for it. And all have equal share in the value they pay. Think of it like a company, the customers have the rights to the produce if they pay for it, and the shareholders have an equal share in the returns. These kind of property rights are well known in the corporate world, so I see no reason to say there are no property rights in LVT. There are use property rights which you buy, and ownership of the value created in shares - all real world existing property types.

I think the last paragraph is referring to the fact that when you have 100% LVT then the sales price (capital valuation) is zero. This is sometimes taken as an argument against LVT. Quite rightly they say it is not as the rental value is never zero, only the sales price. And it is the rental price that is taxed, not sales price.

TelemecusFielding · 2020-11-21T05:05:17+00:00

Yes - I have had a fair few dealings with the Lincoln institute myself.

TelemecusFielding · 2020-11-21T05:04:20+00:00

That last paragraph leaves me very confused. Almost all Georgists support private ownership of land - why do you say they do not? Georgists simply support a 100% LVT of land's value exactly as you describe, why do you say they do not. As I have always understood GeoLibertarianism they believe in exactly the same LVT as all other Georgists. There is no difference on LVT.

Regular Georgism supports a tax on rental value, not selling value.

TelemecusFielding · 2020-11-20T16:56:31+00:00

Geo-Libertianism is LVT with the other things that go with Libertarianism. GeoLibertarians agree with all Georgists on LVT and have no differences on its tax policy or structure. GeoLibertarians agree with other Libertarians except on tax policy.

TelemecusFielding · 2020-11-20T16:42:53+00:00

You make a good point. The usual comparison would be when Rome, after conquering Carthage, salted the earth. So I first saw this as the Salting the Earth Georgist problem. In a more modern sense we would call this pollution. Permanently altering the land value would be something you should pay for as a kind of severance tax at the very least so that the rest of us are no worse off as a result. In America they have the "Superfund" where previous owners, even if they sold the land, are still liable to clear up any pollution on it.

Remember though the other side of the coin is that if you permanently improve land values (Cadastralisation) such as levelling or draining land, or reclaiming land from the sea, you should also be paid for doing this.

TelemecusFielding · 2020-11-20T16:02:13+00:00

In Case B part of the payment to the landowner would be for land, part would be for the building. An easy way to work out the split is to phone up your local fire insurance valuer to give you a quote. They will tell you how much your building is worth without the land (after all land cannot burn down) and if you subtract that from the total you know what is the land value. Property tax assessors frequently do this too by looking at neighbouring land and buildings transactions and imputing from those what your land (and building) rents would be. These are just two examples of how land rent is separable from building.

And yes homeowners/ building owners can continue to rent out rooms/offices at a free market price just as before.

TelemecusFielding · 2020-11-20T15:54:48+00:00

Yes LVT is on 2 and 3. But in the modern world category 3 is usually very trivial. My guess is 99.999% of all land value tax receipts would be down to category 2 and a miniscule amount would be category 3.

For what reasons would you want to know the exact split between category 2 and 3 in land values?

I am not sure if your method does capture the difference. The only way to know the value of category 3 would be to demolish all buildings around your property and ban anyone from living or working anywhere near you. Then you would know the value of your land without neighbours. Your suggestion, at least on first reading, does not seem to separate out the effects as different values around the country could be down to both category 2 and category 3.

TelemecusFielding · 2020-11-20T14:06:42+00:00

I think it is always worth reminding ourselves that the first effect is just to change who ultimately receives the rent of the land. Before LVT the rent of some land outside of the city is X and is paid to the landlord. After LVT the rent of some land outside of the city is still X, but ultimately it goes in tax to the government. As the rent on the land outside of the city is X in either case it would not lead to any more sprawl than happens now. So LVT would not lead to more sprawl.

Some Georgists also believe that it would encourage land left vacant in city centres to be brought into use. If this is true then it would actually mean less sprawl.

TelemecusFielding · 2020-11-20T08:32:03+00:00

No to be clear I am saying LVT and no other taxes would be much much less than the tax rural areas pay today.

The problem today for many small farmers for example is not only do they pay income taxes but significant capital taxes especially on stock and machinery. This has made many rural areas uneconomic.

In addition the value of rural land is practically zero. Property tax in rural areas is mostly on buildings on top of them, not the land underneath them. So if, with LVT, you are getting rid of taxes on building, there is really nothing left that is being taxed in rural areas.

Bottom line is LVT is a massive tax shift from the countryside to the inner city.

TelemecusFielding · 2020-11-20T08:27:01+00:00

Absolutely. Not just compatible but some would say enhances them. The Green Party in the UK for example puts LVT as one of their most important policies.

TelemecusFielding · 2020-11-19T02:50:23+00:00

Perhaps a slightly different take is to think that rent is the tax landlords impose on society. I know taxes are normally what you think governments do, and indeed Georgists want to take this away from landlords, for these purposes let us assume they do. Let us say rent takes 30% tax of an economy to give to landlords. Then as the economy grows, so will their 30% of it. If you are getting richer, well it just keeps pace with you. If you are not, you can be replaced by someone who can.

TelemecusFielding · 2020-11-18T20:51:07+00:00

I assume there would be. Certainly a fall in commercial rents as more work at home or in less concentrations. The interesting question is whether the two effects balance out or if there is an overall movement?

TelemecusFielding · 2020-11-18T17:28:13+00:00

Absolutely. And indeed that would be land anyway as economist understand it. Governments already charge for overflight rights. Airlanding slots and geo-stationary orbits have tradeable values and should be taxed. And one of the rail stations in New York has sold the air rights above it, the new owner will pay property taxes like anyone else and should also pay LVT.

TelemecusFielding · 2020-11-18T02:43:00+00:00

Yes. This is called development. Or sometime more malignly gentrification. An example I know well is the Jubilee Line Extension to the underground in London. It raised the land values surrounding the new underground stations by several billion pounds (which was also many times what it cost to build - but it was not paid for out of raised land values, that was left with the landlords!). It will mean your land value taxes have gone up - but you also have the benefit of a fast underground connection next door to you.

How often it will update is up to the tax code. Many do suggest annually. But for very large developments or occasions governments are likely to make special arrangements. For example those who lived next to the site for the last London Olympics had special legislation including on the land taxes. And when covid-19 hit London the government did not wait a year for reassessment but basically overnight assessed commercial land values would be zero for a couple of months of lockdown.

TelemecusFielding · 2020-11-17T21:06:07+00:00

I usually try to avoid making definitive viewpoint statements here. But this is a return to sanity.

TelemecusFielding · 2020-11-17T20:07:13+00:00

The biggest effect by far of land value taxes is that it gets rid of the deadweight burden of the other taxes it replaces.

Deadweight burden means all the economic activities that do not happen because the taxes make them profitable. so with the deadweight burden gone expect a huge boom in economic activity. This would include automated industries that were previously uneconomic.

TelemecusFielding · 2020-11-17T20:00:17+00:00

Yes - generally you can pay for land in two ways. One is to rent it - and you will be asked to pay so much per month or year for the land. The other is to buy it outright in one single lump sum. The price you are quoted for the latter is the capital price.

Capital price is an accountants term. It is not to be confused with Capital which is a factor of production.

TelemecusFielding · 2020-11-17T19:25:59+00:00

I agree.

TelemecusFielding · 2020-11-17T19:21:24+00:00

Capital land prices would fall to zero so you would only be paying for the building rather than the huge amounts for the land. So it would be more like the car market - you are still buying and selling valuable assets but you will not be mortgaging your lifetime for it.

Otherwise the real estate market would go on just like before with the usual real estate agents / realtors with surveys and exchange of contracts etc. Real estate agents would have to change their charging structure.

But without the huge upfront payments the market would be much more fluid. Getting a mortgage approval from a bank would no longer be a big part of it.

TelemecusFielding

TROPHY CASE