Re: Land rent and the working poor

jmh wrote:

On Wed, 11 Apr 2007 21:32:11 -0400, Les Cargill in sci.econ confessed to the world saying:

jmh wrote:

On Tue, 10 Apr 2007 22:11:29 -0400, Les Cargill in sci.econ confessed to the world saying:


jmh wrote:

<snip>

Improvements go to zero in value over time.


At which point the "housing" would provide no
economic service and the person would be indifferent
to standing in the house to get out of the rain and
standing somewhere out side the house to get out of
the rain.



Think book value, not utility per se.


Why would we o that in this context.

I can't really say - I just beleive
that's the standard in play. Probably
because it's a bean counter thing.

The claim
is that the improvements are worthless and the
poor only paying for the land rents. If the
improvements are not *economicially* fully depreciated then the poor will be paying use value not just land rents.

I'm somewhat out of my depth on the subtle
parts of this :)

> The owners
of the improvements are not going to give
the housing services away for free merely
because they've recaputured the investment
though tax deductions.


I am not 100% sure you're right there - the income
flows would be the same, regardless of the
distribution.

I am also not 100% sure, but I think that there is
no actual book value to the 'housing services' when
there's no additional depreciation.

If the property were to change hands, the improvements
would not tend to be something of value in the
transaction. They may even be a liability.

I vaguely remember that this is all based on
*maritime* accounting, which was about the
lifespan of some aging hulk versus risk of
cargo loss. But again, I am not all that
literate in accounting. Value is 100%
dependent on how it's measured.



If so then why are these people not choosing
homelessness and taking bath's in the YMCA or YWCA or
some other similar place?

What't tying them to the land rent?

jmh

Access to goods and services, or to fertile land.

In general, proximity to the means of production.


All of which are available to the person not living in
the 0 value housing as well.


But if a person wants to be in the movies, they have
to live in proximity to the movie business.


And limving on the steets in the same area where the
worthless housing is allows that.


Well, as evidenced by the movie "The Pursuit of Happyness",
you may well be right.

It's a cold hard fact - that's the person's problem, not the
"system's" problem. That's pretty much why the Geoists
would like to see it change. If you can find
the e-text to Jack London's "The Abyss"....

jmh

--
Les Cargill
.

Relevant Pages

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