The Property Tax Plot

On Georgism, Stewardship and Development

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[AUDIO] The Property Tax Plot

Florida Governor Ron DeSantis is trying to push forward legislation that would ameliorate the property tax burden by eliminating non-school property taxes on the first $150,000 of a home’s assessed value starting January 1, 2027, increasing to $250,000 on January 1, 2028, and indexed to inflation thereafter. Importantly, it would be limited to primary homesteads, and the limited exemption means those who live in more valuable homes would still be paying most of their property taxes. Originally, the law was meant to entirely eliminate property taxes on owned primary residences valued at $500,000 or less, but the legislature watered that down somewhat.

So far as ways of ameliorating the tax burden on ordinary, industrious people go, it’s a reasonably good one. Blackstone will be paying full taxes on those many thousands of homes BlackRock lent it money to buy, the snowbird retirees and oligarchic financiers who have decamped from New York to Florida will still have to pay substantial property taxes on their McMansions and ugly modernist palaces, and normal people will see their taxes decrease substantially. Further, it benefits homeowners, who are disproportionately white and working. Nothing is perfect, but it’s a reasonable policy, particularly considering that Florida has a large budget surplus and already has no income tax.

Bizarrely, it also led to a gigantic freakout.

Leftists were upset because it would cut taxes, which they hate, and because they feared it might mean “social services” (read: Dewayne Geld) could be cut. Namely, public schools. To such people, the point of the state is to spend two decades and millions of dollars trying to teach D’Qrisus endless remedial English classes before letting the still-illiterate student graduate. Such is the nature of equality.

But a certain slice of the right, particularly a smattering of the “Right Wing Third Worldist” types and the committed economic populists, were also upset.¹ To them, the tax cut was bad because it would help property owners hold onto their property, and that is unjust because (they say) the wrong people hold property. Namely, it takes someone already having been somewhat successful to own a home, so ameliorating the property tax burden had to be a handout to “Boomers”² or “oligarchs” or whatever.

I found this attitude bizarre. The tax law change was specifically written to prevent Blackstone and like entities from taking advantage of it. Florida has a nearly $4 billion tax surplus, making tax cuts of this level—under $200 million—common sense. In only really benefiting the owners of modestly priced homes who live in them, it benefits middle-class Floridians rather than vacationers and the finance and tech elite that wants to move to Florida. It’s a reasonably good policy.

Nevertheless, some of the usual suspects were banging the drums about it and pronouncing it to be abominable. Astounded, I spoke to a friend about this, and he suggested I look at the book behind much of the current attitude surrounding property tax, particularly on the knee-jerk populist side of politics: Progress and Poverty by Henry George. As he pointed out when requesting I write an article on the subject (which I’m always happy to do when paid subs request it!), many on the populist right and left alike have a bizarre fascination with this book, which was written in the mid-Gilded Age by a “deistic humanitarian” who wanted to “confiscate rent” in the name of the “public good”.

In response, I did a bit of research and remembered why I had avoided the “Georgism” subject back when I first heard about it a few years ago: it is about as idiotic and aggravating a perspective as could be imagined, for reasons I’ll discuss here. That said, it’s also useful to examine, as the general Georgist perspective underlies much of America’s current property tax regime and the thought behind it, the combined effect of which is to punish stewardship and reward the sort of overdevelopment that has turned America into a strip mall. Additionally, the property tax regime is the other side of the envy and expropriation issue I wrote about last week.

So, that’s what I’ll do here. Below is a brief review of what “Georgism” is, and then an argument on why it is one of the worst tax regimes yet conceived and entirely wrongheaded, with one exception where it tends to make some sense. In my next article on this subject, I will cover why the libertarian view of property is wrong, and there are duties attached to land and wealth that must be fulfilled for society to function, rounding out this series on property and the public.

Georgism: The Policy of Strip Mall Maximization

Once so desperately poor that he set out to rob a rich man—who instead gave him $5 (a quarter ounce of gold) out of the kindness of his heart before robbery was even threatened, an experience from which he learned nothing—Henry George seems to have constructed an entire ideology justifying this “rob the well off, whatever their virtue” approach to life.

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