The Historical Clash Between Two Economic Ideals
Interesting to see a variation of the “partial implementation, partial results” argument that a lot of us like being used even back then.
This is great. Thank you for taking the time for bringing this together.
Reading some of the history of the Altoona LVT experiment made me thing that it would be helpful to layout a practical series of steps that municipalities, counties, or states could follow to implement an LVT.
Specifically it seems like the distressed communities trying to implement an LVT ran into the following doom loop.
1) Implementing an LVT required a large increase to the mill rates (though of course only applied to land) which was politically confusing and also an information/complexity barrier to potential investment.
2) Implementing an LVT ended up causing a lot of private land owners to abandon their land to the city, which reduced the tax base and required further increases in LVT rates to compensate (along with infrequent reassessment)
3) The combination prevented the formation of a stable equilibrium where the theoretical benefits of LVT could be shown.
Obviously I'd love to see you guys do a full retrospective and especially interview some of the people who were involved to get a closer look then the newspaper stories, but it does seem like there needs to be a plan for implementing an LVT in a way that generates a stable revenue base (the one that jumps out to me is the requirement for swift auctioning of abandoned land, probably tying into the assessment system somehow). Once you have a stable LVT, you should be able to gradually shift taxation from other sources into the LVT instead.