I would like a reduction in taxes and spending, and I am partial to raising such revenue with a LVT – but I fear a backlash since the base may noit be large enough to have a low rated, efficient, equitable tax applied to it.

APPENDIX: HOW LIBERTARIAN IS A CITIZEN’S DIVIDEND?

In the above post I wrote: “The implication is that the potential revenue from rent liens is more than enough to replace taxes. What then should be done with the `excess’ revenue? The libertarian answer (I presume) is that the excess revenue, together with a large part of the present revenue, should not be collected in the first place…”

Hence you might ask:

(1) Why do I only “presume” this to be the libertarian answer?

(2) As I am a self-confessed Georgist, what is the Georgist answer?

It is easier to answer these in the reverse order.

(2) The “purest” Georgist answer is that the State should collect the entire rental value of the land, and that if the resulting revenue is greater than reasonable spending requirements, the excess should be distributed to the people as a “citizen’s dividend” — the Georgist version of a basic income, distinguished from other versions by the fact that it is funded out of land rents.

(1) While the “presumed” answer is consistent with the libertarian ideals of small government and minimal taxation, the following libertarian arguments also warrant consideration.

First, according to Locke, a labourer has the right to use the earth, and to appropriate that part of the earth with which he has mixed his labour, “at least where there is enough, and as good left in common for others.” In particular, he has the right to appropriate the land that he improves, as long as there is “still enough and as good left; and more than the yet unprovided could use.” The quoted condition is known as the “Lockean proviso”. All this is accepted by Georgists. When the Lockean proviso begins to be violated — that is, when the land left over (in its unimproved state) is no longer “as good” as that already appropriated (again in its unimproved state) — then, according to Ricardo’s law, the land already appropriated will command a site rent (the word “site” referring to the unimproved state). This rent is the measure of the encroachment on equal rights to land when the Lockean proviso does not hold. According to Georgists, this rent is therefore the compensation that the appropriator owes to his fellows for the encroachment on their equal rights, and the enforcement of such compensation is, or is part of, the minimum function of the State. Even if one somehow denies that full public collection of the site rent is PRESCRIBED by Locke’s position, it is certainly CONSISTENT with Locke’s position, because the rent exists only when Locke’s premise is violated.

Second, it seems that a negative income tax (NIT) is respectable in libertarian circles. And a negative income tax is equivalent to a basic income. For example, the LDP’s proposal of a flat 30% income tax with a threshold of $30,000, allowing the “tax” to be negative when income is below the threshold (http://ldp.org.au/index.php?option=com_content&id=1167), is equivalent to a flat 30% tax with NO THRESHOLD combined with a basic income of $9000. Whichever way you express it, the graph of after-tax income vs. pre-tax income is the same. If the NIT is subject to some sort of activity test, the same test can be applied to the basic income, thus maintaining the equivalence. But a basic income needs to be funded somehow. Fund it out of the rent of land, and you get what Georgists call a citizen’s dividend.

These observations may help to explain why there are Georgists who call themselves geo-libertarians or even geo-anarchists, and why there are so many issues on which Georgists sound like libertarians.

As I write (Mar.2, 5.26pm), the first of the two links in the text is temporarily broken because the web host is switching to new servers. But the link should be working again in a few hours.