If you make a change that hurts their capital it better improve their cash-flow. And if it hurts their cash-flow it better improve their capital value.

I say this with reference not only to the electorate but also to Hernando De Soto who didn’t find out anything NEW exactly when he discovered that the clarity of property rights was just so important.

I mean we all knew that right. But what he found meant that you could cut all these taxes. And you could have free trade. And perhaps you could have even a great deal of savings….

….and if you didn’t have that clarity of property rights your third world economy might still not get off the ground.

So this puts paid to anarcho-capitalist notions that you just trash government and regulations and hope that after a lot of tumult things will sort themselves out.

Getting to anarcho-capitalism or even libertarianism will require a lot more energy and motivation then that.

But in any case thats a tall order. To start bringing on the land tax and yet never let current land-owners down. And at the same time never or seldom compensate them outright with stolen cash either.

Its a tall order so I’ll be writing something on it later.

Its about stealing $10 less with one hand but always thieving $1 more with the other in the form of land tax.

Because when you reduce other forms of depredation that will ultimately feed into the current land-owners capital value and cash-flow… And that would be the only way you could lock in just that little bit extra land-tax….

((((((((perhaps delayed 5 years for current land-owners so their capital value does not take off yet their cash-flow improves))))))))….

I’ll put my thoughts on my blog a bit later.

Money is a coward. And right now virtually all investment in our society is tied up some way with ‘bricks and mortor’ which really meand ‘land and lawyers’.

Some level of land tax (if one really must tax ) is likely to help produce a better and fairer society in the longer run being as its the only tax that is BOTH redistributive AND efficient (up to some hard to fathom point).

But the interim thing is just damn scary.

You could blow everything. Destroy everything.

And you could really deliver the country into the hands of hard-core thieves.

The Georgist view is that this cost is zero, my view is non-zero.

It is an open question as to whether the deadweight costs are more or less than the income tax”

Thats just ridiculous if the tax is:

1. Only for minimalist government.

2. Is long-established.

The danger is in how high people want to send it and how it is introduced.

Because if its just dumped on people it amounts to a sudden loss of all their capital.

It hits them twice. HIts their cashflow and the asset value and if they hold debt on the asset their net worth can go from millions to negative millions overnight.

But as a long-established thing if its not too high its dead-weight loss is very small against any other tax with only the possible exception of the VAT.

“It is an open question as to whether the deadweight costs are more or less than the income tax”

You cannot be serious Sinclair. Not once the above caveats are taken into account.

You’re nostalgic for the Thread of Doom, aren’t you, ABL?

What are Rothbard’s objections - anyway, it seems to be the least worst tax in terms of deadweight loss, it acts somewhat like a head tax and has other desireable features of a tax mentioned by Smith. Rothbard avdocated socialism in banking, so why should he be trusted?

Another “practical” concern, land ratings. This is trivial. Just use CPI adjusted purchase prices, with the option to have your property valued lower by a specialist.

the deadweight losses of income taxation are well established

I agree. Where we disagree is on the deadweight costs of a Georgist land tax. The Georgist view is that this cost is zero, my view is non-zero. It is an open question as to whether the deadweight costs are more or less than the income tax. But I disapprove of the income tax anyway. It is well-known that a flat-tax would be preferable to the income tax.

Georgist land tax is a terrible idea - take Murray Rothbard’s view if you want a ‘real’ libertarian as a source.

It’s in Marshall. That dvision of labour stuff was also developed by Stigler. What is more, Romer derived it from mathematical first principles anyway.

Marshall and Stigler followed Smith precisely. Romer spent a great deal of time deriving what anyone who had read Smith already knows. It’s called reinventing the wheel. Now, I accept it was difficult and he did a fine job and all, but we kind of knew it already.