Conservatives calling Jesse Myerson a Communist for supporting ideas like Henry George’s land value tax is pretty amusing since Karl Marx himself described Georgist politics as “capitalism’s last ditch.”
The land value tax is basically just the property tax, except it taxes the land part of property at a higher rate than improvements. The land part of the property tax is only paid by landlords though and can’t be passed on to rental tenants, so shifting the tax burden onto land is basically just expropriating wealth straight from your landlord’s pocket.
That makes it a progressive tax in my book, but some progressives complain that flipping the two parts of the property tax around to penalize vacancy and promote urban infill development would be politically repugnant because it would reward our biggest buildings with huge tax breaks. We could get around those bad optics a bit with a 5-1 ratio for land to buildings, but there’s no denying that’s true, and it’s why Karl Marx hated the idea. But not being a Marxist, I think he’s wrong and Henry George has the better of the argument.
Henry George differs from Marx in this important respect: whereas Marx’s politics envisioned a bifurcated struggle between labor and capital, George’s politics placed labor and capital on the same side, with landowners on the other.
George’s idea is that you work for a living, and (contra Marx) that the honest-to-God investors who make stuff like buildings and machinery and national telecommunications networks and politics blogs make an honest living too. But your landlord doesn’t really work. He makes money by sitting around owning stuff, repairing your dishwasher sometimes, while you toil doing real work to pay him a third of your income or more.
What if we stopped taking so much money in sales, wage, and investment taxes from the people who work and invest for real, and started funding more of our public services with wealth expropriated from people who just own stuff. Rent hikes would stop eating into wages so much, workers and businesses would have more disposable income to spend and invest in the real economy, and this would all create a much stronger economic foundation for cities.