Georgism is an economic philosophy and ideology advocating for a single tax on the unimproved value of land (land value tax, or LVT) as the primary or sole source of public revenue. It is based on the ideas of the 19th-century American economist and social reformer Henry George, who argued that land, as a natural resource, belongs to all of society and that the value of land is created by the community, not by individual landowners. Proponents believe LVT would generate sufficient revenue, reduce land speculation, promote more efficient land use, and eliminate other taxes that distort the economy and harm labor and capital. The philosophy also often includes the notion of a "citizen's dividend" where the revenue collected is used to support universal basic services or cash payments to citizens. It is distinct from other forms of land ownership and economic systems like socialism and capitalism, although some schools of Georgist thought share some principles with these broader ideologies.
Georgism meaning with examples
- Georgism, with its emphasis on a land value tax, offers a potential solution to wealth inequality by capturing unearned income derived from land ownership. By taxing land, Georgists aim to discourage land speculation and encourage more efficient use of land, ultimately benefiting society. Many believe this would lead to a more equitable distribution of wealth and create more productive use of land.
- Henry George's ideas, the foundation of Georgism, proposed a single tax on land to fund all government expenditures. Modern proponents of Georgism believe that this would promote economic efficiency, reduce property tax burdens, and eliminate regressive taxes on labor and capital. This would lead to more prosperity for the general population and promote social justice.
- Critics of Georgism raise concerns about the practical implementation of a land value tax and argue that valuation can be challenging and susceptible to political influence. They also question whether LVT revenue would be sufficient, especially in areas with high demand for public services. However, advocates say these concerns can be dealt with through robust government valuation and careful tax rate design.
- Georgism appeals to both left-leaning and right-leaning thinkers as it's a philosophy of free-market principles. The LVT would decrease economic inequality and create efficiency within the marketplace. While also providing revenue for public services. Advocates believe this promotes liberty and economic freedom while addressing social issues.