Comment on Parts of the New York State Legislative Tax Study
Commission's "Who Pays New York Taxes?"
H. William Batt
[The author was one of six staff members of the New
York Tax Study Commission from 1982 to 1992. These are his thoughts on
one of the Commission's papers twenty two years later. Spring, 2007]
My Personal Involvement
It is over two decades since the New York State Legislative Tax Study
Commission released a series of "Working Papers"
addressing the design and administration of the State's tax code. I
served as the staff political scientist there for nearly a decade, and
had a small part in the development of some of its ideas. One of the
papers was titled "Who Pays New York Taxes?" My comments
here are on that one report, specifically with respect to its
conclusions about New York's real property tax. It is the only paper
where the property tax was discussed at all, and it did so only as a
matter of completeness. This is because the mandate of the Commission
as stipulated by the authorizing statute precluded any examination of
the property tax; another task force not too long before had examined
that realm of fiscal policy. But this is the part that I now wish
to address, even given its peripheral attention by the Commission
At the time I joined the Commission staff, I had no special expertise
in tax policy, or even in economics. So with a team of more
experienced people specifically retained for the tasks of the
Commission's charge, I was the most reticent about, and also the
most accepting of, conclusions offered by the staff and its director.
The staff director, Richard ("Rick") Pomp, was a law school
professor with a long resume of published work specifically on tax
policy. He had studied with Harvard's Learned Hand Professor of Law,
Oliver Oldman, and soon afterwards himself became the Alva P. Loiselle
Professor at the University of Connecticut School of Law. On leave
from his position as a professor, he became full time Director of the
Commission for over two years, and its work essentially reflected his
views. The other five of us were really aides to Professor Pomp's
agenda. The charge was to look at New York's tax structure - from top
to bottom - and to make judgments about possible improvements using
the broadest framework it could muster. Following the 1985 federal
income tax reforms, State taxes that piggybacked on these revisions
were obliged to restructure themselves. And the Commission had a hand
in suggesting broad simplification by moving from several graduated
rates to two broad rates. These changes were made by other staffers
after Pomp had returned to his teaching position.
By the time I left the Commission staff in June of 1992, I had
acquired a fair amount of expertise in tax policy, at least from the
standpoint of its politics, philosophy, history, and economics, even
though I still found its law and accounting well beyond my reach.
Moreover, because I found corporate tax policy too abstruse, I elected
to focus my attention on those areas I felt I could perhaps master and
contribute to best - user fees, the sales tax, and the personal income
tax. The Commission and its staff produced in total about ten papers,
most of them by the time Professor Pomp had completed his contract
with the Commission. After 1986, the Commission had little to show for
its record, and the turnover in staff in subsequent years meant that
less and less was expected of it. I elected to stay because I was able
to use the considerable free time to "retool" my academic
background and skills, just as if I was on a salaried fellowship. When
Sheldon Silver was chosen as the new Assembly Speaker in 1992, I was
shortly thereafter ushered out the door having bargained to have ten
years (and one day) of New York State service. That assured me a small
pension and guaranteed health insurance for the rest of my days. Not
really able to return to academia, I also now had the freedom to
pursue paths that were impossible as an employee anywhere else.
My choice was to explore a tradition of economics and tax policy that
I had discovered toward the end of my Commission service: the
philosophy of Henry George. In the summer of 1993, I flew to Los
Angeles to attend the annual conference of the Council of Georgist
Organizations; I had become fascinated with these, to me, totally new
ideas. I have counted myself a Georgist ever since. Never in the
course of ten years reading and discussion of New York's tax policy
options did anything even close to this perspective cross the horizon.
And it is fair to assume that the staffers on the Commission today -
it still exists - have no inkling of what narrow perspective they work
from. Even with ample evidence that the framework of neoclassical
economics on which most of the contemporary American tax system rests
is collapsing, tax professionals have carried on with little awareness
of its pitfalls. Alternate schools of economics are quickly growing
in many quarters - very frequently outside of conventional university
economics departments. There is even ample evidence now that the still
prevailing neoclassical economic paradigm can be shown to violate the
laws of physics! Professional tax literature, however, shows little
evidence of being aware of any of this.
Two further observations about the Commission are necessary here:
First, the reason why the staff products retained the status of "working
papers" and were never finalized was that they would otherwise
have required the approval of the Commission members themselves.
Nominally the Commission had members of both parties and both houses,
but in fact the Commission was totally an Assembly Majority
(Democratic) operation. It would never have been possible to secure
any real consensus, and retaining the working paper status maintained
the facade of provisional work and still allow release for whatever
use might be made of them. Second, several of these papers were
subsequently published together as an issue of the
Albany Law Review, and solely under Professor Pomp's name --
without any recognition of the fact that he was assisted in the
statistics, the economics, the subcontracting, and editing by a New
York State Assembly Commission.
Analysis of "Who Pays?"
Sufficient time has passed, I think, that I can now freely make
observations on some work of the Tax Study Commission, particularly
both since I have more expertise on tax policy and because the
Commission's work really reflected the views of Professor Pomp and no
one else. Only one paper touched on the real property tax, and only in
a few passages. It was originally contracted to University of Missouri
Professor Donald Phares, and this draft was then rewritten by the
Commission (i. e., Rick Pomp) to be released as a working paper. "Who
Pays New York Taxes?" is accessible, by those with resources, in
major libraries at least in New York State. The most recent
statistical data available at that time was for 1980, and in only
three paragraphs of the thirty-three pages of text is the real
property tax treated explicitly. An additional seventy pages have
occasional references to it, with some rather interesting tables and
graphics. All of these, however, are somewhat misleading. Were Messrs.
Phares and Pomp consciously part of the confusion common in dealing
with matters of property taxation or were they simply unaware of the
sleight-of-hand that underlies most of the work in this area? My
personal view is that they were simply not interested in probing more
deeply into an area that was really beyond the Commission's scope.
Still, the authors recognized that "Property taxes are the fiscal
mainstay of local government. The incidence of the property tax is of
substantial consequence in evaluating the State's overall tax
As for their treatment of the New York Local Property Tax, the
authors first identified seven separate categories of real property:
owner-occupied, rental, commercial, industrial, public utilities,
farmland, and unimproved. This is a somewhat unusual classification,
different even than those universally used in New York State. One
can see immediately that there will necessarily be some overlap - "unimproved"
parcels can sometimes be assigned in other categories according to
their zoning. And rental property is commercial, whomever the tenants
may be, whether households or businesses.
To their credit, however, the authors devoted considerable attention
to the issue of tax shifting, which is never an easy subject,
including a discussion of taxes on real property. They recognized that
no shifting occurs for vacant parcels and titleholders therefore bear
the full burden. So also for homeowners. For rental properties they
assigned 50% of the burden to tenants, 25% to corporate stockowners,
and 25% to real estate owners. For commercial, industrial, farmers,
and public utility parcels, the shifting was put at 67%. In every
instance where shifting is recognized, the part never shifted, of
course, is the land component, and this is implicit in their
assumption. These were referred to as "consensus incidence
assumptions regarding the property tax."
A third consideration they recognized is the potential for tax
exporting to other states, more often important for classes other than
residential property but still significant. It occurs both on account
of titleholders being out-of-state and also because of what is known
as the "federal offset," i. e., the deductibility of state
and local taxes for federal tax itemizing. For all New York State and
local taxes taken together, they estimated that roughly 10% percent of
total revenue is exported, but for real property taxes, the total
exported is only about half that.
Except in the implicit recognition involved in their analysis of
shifting, the distinction between land and improvements was opaque.
This is a remarkable oversight, because improvements typically
depreciate at the rate of 0.5 to 1.5 percent annually; only land
values appreciate. And in view of the fact that assessments in New
York localities have historically been very infrequent, one can
understand how the land values are in reality a far higher proportion
of parcel value than assessments would suggest. This means that in
a period of seven years, for example, a property parcel could easily
increase in price by 50 percent, far more if recent real estate market
history is to be illustrative. Moreover real estate prices varied
greatly in their rates of change during this time span; upstate New
York was largely stable, but downstate localities experienced huge
booms and busts.
Recognition of this would tend to favor what is known as the "new
view" of property tax incidence, an acceptance of the idea that "the
burden of the tax on improvements remains with the owners of capital
in the form of a lower net return instead of being shifted to users of
property in the form of higher rents or prices." Proponents
point out that "the tax on improvements is essentially a
nationwide tax on capital . . . [and therefore] its incidence will
depend on the characteristics of supply and demand for capital
nationally rather than on a single market." The effect of
this is to make the tax "highly progressive."
Nonetheless, in a small footnote, Messrs. Pomp and Phares elected to
go with the "old view" in stating that, "it seems most
appropriate to assume that the new view does not apply to the analysis
of tax burdens within one specific state (underlining in original).
Thus, the old or traditional view was adhered to in the analysis. . ;
that is, the excise effect of the tax was considered dominant."
The ubiquity of New York's property tax, and that it has over 1,300
local assessment and tax districts, may well have escaped their
This point is significant because the authors took great pains on
several occasions to emphasize that the New York real property tax was
the "most regressive element in the State's tax structure."
In the Executive Summary, two of the thirteen bullets stressed that "the
dominant influence in the tax system is the local real property tax,"
and that "the local property tax is highly regressive,
particularly the owner-occupied component."
This was portrayed graphically, along with an accompanying table,
using fourteen separate tax brackets showing effective tax rates
ranging in a U, or a "reverse J curve," from a high of 20.51
percent of income for the lowest group, to 3.37 percent for the second
to highest group. Nowhere in the Report is there an indication of
what income measure was employed - Federal Adjusted Gross Income or
Taxable Income, most likely. But it may also have been household
income. If so, this could well have excluded significant income
sources, particularly from those households receiving social security
income and/or retirement income for New York State or local pensioners
which is not taxable for state purposes. Whatever, this was recognized
implicitly in the observation that "many persons are only
temporarily in the lowest class ($0 - $4,199 for 1980) because of
retirement, short-term unemployment, and so forth. If their income
were measured over a longer period of time, rather than on the basis
of only one year, they would not fall in the lowest class. Thus, the
[drastically high effective tax rate] figure for this class . . .
overstates the true burden on this group."
A Deeper Examination of the Property Taxation Quagmire
This last caveat suggests what is likely the most critical failing of
the Report. The use of an income snapshot as the basis for measuring
the effective tax burden on owners of real property reflects a
misunderstanding of how tax equity should be construed. The value of
property titles is a measure of wealth, and is likely to have little
if any bearing on any momentary snapshot of income in a household.
This confusion lies at the very core of difficulties in assessing the
fairness of the property tax. Several studies of tax equity involving
the real property tax fail to recognize that they are using income as
a benchmark for analysis, even while the tax is upon wealth.
The problem as I see it is the mixing of two separate dimensions of
economic value - what are frequently referred to as stock and flow.
Stock value is a variable that has no time dimension, e.g., the stock
of capital, or what in real estate is typically understood as the
market price of a parcel. Flow, by contrast, is the quantity of an
economic variable measured over a period of time. So the flow of an
investment may be measured as the amount of investment expenditure or
the amount of income return in a given time, such as in a yearly
period. We can easily understand stock when looking at the value
of a house or an office building just as we can for a car or a
computer, as it represents the investment of labor and capital, and
can be priced based on market supply and demand, depreciation, and
replacement value much as with any other manufactured good.
The other component of a real property parcel is the land value,
which reflects a market price based on very different criteria.
Despite the apparent reality that land is visible and tangible, land
prices reflect the value of location more than they do the material
content they contain. This is easy to understand when one reflects
that if some earth is removed from a site and brought to another
place, the prices of each site is largely unaffected. Location
value has duration, and the value of this flow of rights for exclusive
use of a site requires a flow price rather than a stock price. This
flow is really what classical economists refer to as ground rent or
economic rent. Also known as "land rent," it is defined
as "a payment to a factor beyond what is needed to put that
factor into use; [it is a price for use] beyond what is needed to
maintain a market for land." Land has a selling price because
we have come to regard land sites as objects, as commodities to be
traded, and they are understood to have a static price, as a stock
rather than as a flow. That stock price really needs to be understood
instead as the "present value" of the flow of ground rent
minus taxes. "Present value" is an economic term that refers
to "the worth of a future stream of returns or costs in terms of
their value now." Consideration in this way brings to the
fore other concerns and factors.
The market price of a location depends not only on ground rent and
taxes, effectively its present value, but also upon the "discount
rate," or interest rate, that prevails in the market used to
calculate its returns and costs. When interest rates go up, the market
prices of sites fall, just as for any other economic encumbrances
placed on locational sites.
The market prices of sites also fall if taxes go up and nothing else
changes. However, an increase in taxes is often accompanied by
improvements in any obligations linked to parcel locations. These too
are sometimes easily "commodified," and may vary
according to time period, changed neighborhood expectations, emergency
conditions, government regulations, and so on. These contingent
links often constitute services that raise the market prices of sites
more than the taxes depress them. Still another way of understanding
the value of locations is to see them as capitalized transportation
costs. Savings in transportation are likely to be expressed in the
market price of sites. One way or another people are willing to pay
for access to exchange markets: either in the form of site proximity
or in the form of travel expenses. It is the reason why urban cores
have higher site rents than peripheral areas and hinterlands. Hence
the differential value of locations, dependent, not on anything
titleholders do, but rather on the quality of community amenities.
These all have a price.
The prices for services that raise land rents, like the services
themselves, should be regarded as flows rather than as stocks. But,
ironically, our payments for such services are not understood as flows
affecting site values at all, but are seen rather as related to stock
prices. The values of our property parcels are viewed solely as
stocks, and therefore our taxes are seen as stock taxes.
Henry George's Solution: Taxing the Flow of Land Rent
If land values are really the present values of anticipated future
ground rents, one can certainly treat them as flows rather than
stocks, just as community services are continuous flows. The amount of
rent flowing through a site and through the economy is not negligible;
what estimates have been made, where indeed the economic data allow it
to be made, suggest that it is roughly a third of a nation's GDP.
The question is whether it makes more sense to. Should we elect to
continue property tax regimes as we do, it would make better sense to
tax buildings as stocks and lands as rent flows. But this raises the
question whether real property should be exempt from all taxes, as
some have argued. What rationale exists for taxing lands, whether
as stocks or flows; and why do we tax buildings? I will argue below
that taxing buildings and the failure to adequately tax land both have
deleterious consequences for the whole economy.
Little justification exists for taxing buildings, or improvements of
any sort, so this question is easily disposed of. The practice is
explained largely as a matter of historical inertia. Only in the
recent century or two have buildings represented any significant
capital value; prior to the rise of major cities, the value of real
property lay essentially in land. American cities today typically
record aggregate assessed land values - at least when the valuations
are well-done - at about 40% to 60% of total taxable value, that is,
of land and buildings taken together. Skyscrapers reflect enormous
capital investment, and this expenditure is warranted because of the
enormous value of locational sites. Each site gets its market price
from the fact that the total neighborhood context creates an
attractive market presence and ambience. By taxing buildings, however,
we impose a penalty on their optimum development as well as on the
incentives for their maintenance. Moreover, taxes on buildings take
away from whatever burden would otherwise be imposed on sites, with
the result that incentives for their highest and best use is weakened.
Lastly, the technical and administrative challenges of properly
assessing the value of improvements is daunting, particularly since
they must be depreciated for tax and accounting purposes, evaluated
for potential replacement, and so on. In fact most costs associated
with administration of property taxation and appeal litigation involve
disputes over the valuation of structures, not land values.
Land value taxation, on the other hand, overcomes all these
obstacles. Locations are the beneficiaries of community services
whether they are improved or not. As has been forcefully argued by
this writer and others elsewhere, a tax on land value conforms to
all the textbook principles of sound tax theory. Some further
considerations are worth reviewing, however, when looking at ground
rent as a flow rather than as a "present value" stock. The
technical ability to trace changes in the market prices of sites - or
as can also be understood, the variable flow of ground rent to those
sites - by the application of GIS (geographic information systems)
real-time recording of sales transactions invites wholesale changes in
the maintenance of cadastral data. The transmittal of sales records as
typically received in the offices of local governments for purposes of
title registration over to Assessors' offices allows for the
possibility of a running real-time mapping of market values. Given
also that GIS algorithms can now calculate the land value proportions
reasonably accurately, this means that "landvaluescapes" are
easily created in ways analogous to maps that portray other common
geographic features. These landvaluescapes reflect the flow of ground
rent through local or regional economies, and can also be used to
identify the areas of greatest market vitality and enterprise. The
flow of economic rent can easily be taxed in ways that overcomes the
mistaken notion that it is a stock. Just as income is recognized as a
flow of money, rent too can (and should) be understood as such.
The question still begs to be answered, "why tax land?" And
what happens when we don't tax land? Henry George answered this more
than a century ago more forcefully and clearly, perhaps, than anyone
has since. He recognized full well that the economic surplus not
expended by human hands or minds in the production of capital wealth
gravitates to land. Particular land sites come to reflect the value of
their strategic location for market exchanges by assuming a price for
their monopoly use. Regardless whether those who acquire title to such
sites use them to the full extent of their potential, the flow of rent
to such locations is commensurate with their full capacity. This is
why John Stuart Mill more than a century ago observed that, "Landlords
grow richer in their sleep without working, risking or economizing.
The increase in the value of land, arising as it does from the efforts
of an entire community, should belong to the community and not to the
individual who might hold title." Absent its recovery by
taxation this rent becomes a "free lunch" to
opportunistically situated titleholders. When offered for sale, the
projected rental value is capitalized in the present value for
purposes of attaching a market price and sold as a commodity. Yet
simple justice calls for the recovery in taxes what is the community's
creation. Moreover, the failure to recover the land rent connected to
sites makes it necessary to tax productive activities in our economy,
and this leads to economic and technical inefficiency known as "deadweight
loss." It means that the economy performs suboptimally.
Land, and by this Henry George meant any natural factor of production
not created by human hands or minds, is ours only to use, not to buy
or sell as a commodity. In the equally immortal words of Jefferson a
century earlier, "The earth belongs in usufruct to the living; .
. . [It is] given as a common stock for men to labor and live on."
This passage likely needs a bit of parsing for the modern reader. The
word usufruct, understood since Roman times, has almost passed from
use today. It means "the right to use the property of another so
long as its value is not diminished." Note also that
Jefferson regarded the earth as a "common stock;" not
allotted to individuals with possessory titles. Only the phrase "to
the living" might be subject to challenge by forward-looking
environmentalists who, taking an idea from Native American cultures,
argue that "we do not inherit the earth from our ancestors; we
borrow it from our children." The presumption that real property
titles are acquired legitimately is a claim that does not withstand
scrutiny; rather all such titles owe their origin ultimately to force
If we own the land sites that we occupy only in usufruct, and the
rent that derives from those sites is due to community enterprise, it
is not a large logical leap to argue that the community's recovery of
that rent should be the proper source of taxation. This is the
Georgist argument: that the recapture of land rent is the proper -
indeed the natural - source of taxation.
REFERENCES AND NOTES
- The formal name under the
authorizing statute is the New York State Legislative Commission
on the Modernization and Simplification of Tax Administration and
Tax Law. It was first authorized in 1981, and has continued to
receive funding to the present time.
- Shortly before, the
Legislature had authorized the creation of the Temporary State
Commission on The Real Property Tax, jointly accountable to
Governor Cuomo, Senate Majority Leader, Warren Anderson, and
Assembly Speaker, Stanley Fink. Its Executive Director was
Laurence Farbstein. This commission continued throughout the
- The staff of the Legislative
Tax Study Commission had six people for its initial and most
productive years. There were two lawyers, an accountant, an
economist, a political scientist, and a secretary-administrator.
- This is amply demonstrated by
economist Nicolas Georgescu-Roegen, The Entropy Law and the
Economic Process. Cambridge: Harvard University Press, 1971,
and corroborated by Herman Daly, Steady-State Economics,
2nd Edition. Washington, DC: Island Press, 1991.
- Albany Law Review,
Vol. 51 (Spring/Summer, 1987), Issue 3, 4; pp. 369 ff.
- "Who Pays New York
Property Taxes," p. 15.
- New York's Office of Real
Property Services provides a common classification structure to
all assessment districts throughout the State. These are
Agricultural, Residential, Vacant, Commercial, Recreational,
Community Services, Industrial, and Public Services.
- "Who Pays," p. 15.
- John P. Harding, et al., "Depreciation
of Housing Capital, Maintenance, and House Price Inflation:
Estimates from a Repeat Sales Model," Journal of Urban
Economics, Vol. 61, No. 2 (March, 2007); and Morris A. Davis
and Michael G. Palumbo, "The Price of Residential Land in
Large U.S. Cities," Finance and Economics Discussion Series,
Washington: DC: Federal Reserve Board, 2006.
- In recent years a greater
effort has been made to bring assessments into line with actual
market prices, but there is still no requirement in New York State
that this be done. Connecticut now requires assessments every five
years, and the State of Maryland takes responsibility for doing
one-third of the localities each year.
- James Heilbrun, "Who
Bears the Burden of the Property Tax?" in C. Lowell Harriss
(ed.), The Property Tax and Local Finance. New York:
Proceedings of the Academy of Political Science, Vol. 35, No.1
(1983), p. 60.
- Ibid., p. 61.
- Ibid., p. 65.
- "Who Pays," p. 68,
- "Who Pays," p. 27.
- See also "Who Pays,"
- This was based on 1980 tax
data. Therefore, the groups were much lower than current levels.
The lowest income class was "under $4,200," and the
highest was "over $49,000."
- "Who Pays," p. 21.
- The MIT Dictionary of
Modern Economics, Fourth Edition, David W. Pearce (Ed).
Cambridge: MIT Press, 1994. p. 410.
- The MIT Dictionary .
- The big exception to the
invariability of land qualities is the matter of brownfields,
which frequently preclude the use of sites and constitute a
potential liability to titleholders.
- This term is frequently used
by those who appreciate the significance of the concept. See John
C. Lincoln, Ground Rent, Not Taxes: The Natural Source of
Revenue for the Government. New York: Exposition Press, 1957.
- Fred E. Foldvary, Dictionary
of Free-Market Economics. Northampton, MA: Edward Elgar
Publishers, 1998. p. 121 ff.
- One recent historical
chronicler notes that, "by the middle of the eighteenth
century, the American idea of landed property had evolved beyond
its English roots. Americans had begun to speculate on land. It
had become a commodity." This would come to characterize
treatment of land worldwide before very long. See. Andro
Linklater, Measuring America. New York: Walker & Co., 2002;
and Robert J. Miller, Native America: Discovered and Conquered.
Westport, CT: Praeger Press, 2006. This writer's reviews are
online at the Amazon.com for the second and, for the first, at
A third recent account of how the great land grab unfolded is John
C. Weaver, The Great Land Rush and the Making of the Modern
World, 1650 -1900. Montreal: McGill-Queens University Press,
- The MIT Dictionary .
- One recent writer has coined
the word "propertized" to refer to this transformation.
See Peter Barnes. Capitalism 3.0. San Francisco: Berrett-Koehler
Publishers, 2006. See this author's review at
- An easy illustration is the
requirement that sidewalks be cleared of snow within a certain
interval after a storm. Alternate street parking, ration of
privilege for communal amenities, garbage pick-up, and so on are
all obligation linkages that may affect the market price of
locations. Still more obvious still are community services like
schools, libraries, public safety services, and so on.
- H. William Batt, "Stemming
Sprawl: The Fiscal Approach," Chapter 10, Suburban
Sprawl: Culture, Theory, and Politics, edited by Matthew J.
Lindstrom and Hugh Bartling; Rowman & Littlefield Publishers,
2003. Also online at
- See, for example, Terry
Dwyer, "The Taxable Capacity of Australian Land Resources,"
in Australian Tax Forum, January, 2003.
www.prosper.org.au/Documents/TaxableCapacity.pdf; and infra.
See also Steven Cord, "How Much Revenue Would a Full Land
Value Tax Yield? Analysis of Census and Federal Reserve Data,"
American Journal of Economics and Sociology, Vol. 44, No.
3 (July, 1985), pp. 279-293. More work will be forthcoming on this
question soon, hopefully, and with much greater documentation.
- It is not difficult to find
people who argue for this solution, and there are no shortage of
opinion pieces, legislative bills, and other evidence of this
sentiment. A Google search on "abolish property tax"
turned up over a million hits.
- For this writer's views on
assessment and appraisal practices for purposes of real property
taxation, see my testimony before the New York State Assembly Real
Property Committee, February 6, 2007, available online at
- Principles of Political
Economy, bk.5, ch.2, sec.5.
- "Deadweight loss is the
loss of producer's or consumer's surplus stemming from the price
of a good being higher than marginal cost or to a tax that
increases the cost. A lower quantity is purchased than would be
the case without a tax or under ideal conditions, such as the
elimination of artificial barriers to entry. (Fred E. Foldvary,
Dictionary of Free-Market Economics. Northampton, MA:
Edward Elgar Publishers, 1998. p. 103.) The attachment of economic
rent to land sites means that a market of less than perfect
competition exists, thereby engendering deadweight loss.
- Jefferson letter to James
Madison, September 6, 1789. Writings of Thomas Jefferson,
1892-99. Ford, Lesson IX.
- Fred E. Foldvary, Dictionary
of Free-Market Economics. p. 288. It is very revealing that
the term does not appear in The MIT Dictionary at all.
- This is a point that is made
vigorously by disciples of Henry George. Central to many of the
Georgist websites, I find the one at www.answersanswers.com
particularly articulate on this point. George's own speech, "Thou
Shalt Not Steal," delivered in New York City in 1887, is a
classic, accessible online at
- Two prominent and early
proponents of Henry George's ideas wrote books with those very
titles. Thomas Gaskell Shearman's book, Natural Taxation,
was published in 1895 and revised in 19ll; Charles Bowdoin
Fillebrown's book, Principles of Natural Taxation, was
published in 1917. Both had extremely wide circulation and have
considerable value in understanding the history and context of the
period. See my reviews on www.cooperativeindividualism.org.