Forest Through the Trees
How Georgism Relates to Environmentalism
There’s a wide spectrum of folks who are self-proclaimed environmentalists and some who exhibit environmentalist leanings when it’s convenient to do so for some other reason.1 The above graphic can be used in a wide variety of scenarios. In this particular case, I’m using it to illustrate how, sometimes, certain flavors of environmentalists can be so worried about conserving a specific grove of trees or a specific salmon run in the middle of a town or city that they miss the overall impact of this contribution to sprawl.
Exceptions to rules can and should exist. These should be weighed on principles, and preferably not used as political expedients. Each community should be at the helm of deciding where exemptions should be placed and exemptions must be a tool which is employed sparingly — since the effectiveness of a rule or policy is inversely proportional to the number of exceptions it allows. (My hypothesis. Someone else can test this.) Some people really enjoy exceptionalism, and if the impact is minimal, sometimes it can be worthwhile to just “Let them have it.”2 Not everything snowballs and, until then, there are much bigger salmon to fry.
Typical scenario harmonizing Georgism with Environmentalism:
A Georgist might propose initially that there be no exceptions (and point to the graphic).
A Georgist might insist, after some negotiation, that the exempted land should still be regularly valuated and its tax liability regularly assessed, even if the tax liability were to be conscientiously shifted to surrounding lots.
A stubborn environmentalist might continue to push back against this … because to them, knowing how much the lot is worth would allow the community to make more informed decisions around whether or not it’s worthwhile to preserve the lot and any kind of economic decision-making (valuation and quantification) is somehow an incredibly distasteful thing when it comes to saving the planet, while lack of transparency is somehow substantially less distasteful.3
A stubborn environmentalist might also insist that the tax liability not be shifted to surrounding lots because surely those surrounding lot owners would vote against such a proposition if they knew they had to pay to support such an amenity (even though they should anyway if the value of their parcel increases because of its proximity to such an amenity).
A practical Georgist might relent — knowing that the result would be the same whether the community had access to the data and were made aware of it or not: Surrounding lots would still bear the burden of increased land values (and corresponding taxes) and anyone doggedly curious enough could derive the value of the exempted lot based on surrounding increases.
I don’t consider myself a die-hard environmentalist (or even a dogmatic Georgist). I would not, for example, chain myself to a tree to protect it from being leveled. Probably, there is a level of nuance I fail to appreciate which would have otherwise compelled me to Loraxian levels of fierce protectiveness. To me, constraining uses is down-zoning. Being not particularly in favor of land value tax exemptions for golf courses, I can appreciate that at least some golf courses are publicly accessible and at least some golf courses are charged payments in lieu of taxes (PILOT) while the heaviest public burden is generated by those golf courses which are fully exempt as well as fully private. However, I am very sympathetic to environmentalism and green spaces and would love for (true) environmentalists to see Georgism as a potential method of maximizing opportunities for ecological restoration instead of simply as a potential threat to conservation and preservation.
Let’s be friends!
After some time spent in Urbanist circles, I have come to suspect this to be a NIMBY infiltration or tainting of YIMBY causes.
I’m sure we can all think of examples of when exemptions are not used sparingly and the impact is quite immense — like exempting primary residences from land value taxes. This observation tends to stir up some feelings from a lot of folks, but I do see it as a big problem for places like Australia, which already has a land value tax (and sometimes the land value tax is actually a tax on both land value and improvements depending on the tax, so it can get confusing when they use the terms “land value tax” and “property tax” interchangeably, but we could write a whole separate article on that) and have seen the gains from the land value tax be chipped away at and crippled over time.
If you can’t see it, it can’t hurt you — or maybe if you don’t know it’s pinching your pocketbook, it’s less painful? Like automatic withdrawals for subscriptions? Maybe there really is something to Milton Friedman’s idea of needing an automatic payment mechanism for LVT — to make it less painful than income taxes, which has the advantage of being able to be automatically withheld by employers.
Love it! Very well explained. The surrounding parcels always bear the burden of down-zoning. Reminds me a lot of Bastiat's "That Which is Seen, and That Which is Not Seen." We see the benefits of downtown parks but not the scarcity rents they induce. We see the greenery in the city center and worry about its loss, but not the greenery outside the city that is saved from sprawl. Seems like there would always be an inherent selection/preference bias for greenery that is at the center of population and seen by the most people.
I'd raise a couple of points on this:
1) the preservation of natural open space and parks can often increase the value of surrounding land.
2) tree canopy should also be recognized as creating public value; to that end, I've proposed establishing a 'tree canopy market' to establish economic incentives to promote adequate tree canopy in areas that are under their tree canopy target: https://www.strongwa.org/policy-concepts#h.w0mzmwxad1sk (Similar programs could be arranged for other public/natural environment benefits, such as for accommodating stormwater drainage capacity.)
3) land value is made of many different parts, including a bundle of rights. If a particular area is unfit for building due to natural circumstances, the owners of that land should be allowed to sell their "development rights" to be used in some other area of the city which is targeting growth.
4) I'd be willing to provide some exemption of land value tax to properties that actively restrain their rights for the public benefit, such as inviting others to make use of their land by restraining their right to exclusion (in which case they would mark their land as being openly accessible to the public).