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Comment by krupan | Hacker News Reader

Then charge fees for those services based on actual free market supply and demand! Don’t assess everyone a tax based on the perceived unrealized value of the property.

UPDATE: also, read up on the differences between property tax and land use tax. They are different.

‘Nother Update: also, the government should stop encouraging property ownership as an investment for your future and retirement (tax breaks for mortgages, low interest rates, planned inflation) and then charge taxes on the hugely inflated value of that property.

Also, most property taxes are local state-level taxes, and most state-level congresspeople have to have a side gig to stay afloat. Guess what that side gig is: Real estate. Many are realtors and developers. They have a vested interest in raising property taxes to get people selling houses.

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> charge fees for those services based on actual free market supply and demand

There's something to be said for this, but it doesn't work to just flip to the opposite extreme. As long as there are wealth inequities, then free-market supply-and-demand turns into the idea that anyone poor shall have nothing, not even the capacity to travel on streets or drink water. If they don't want to just up and die, they can get a loan to do these things and go into a cycle of indentured servitude for life.

The free market has never had any solution to such issues. Supply-and-demand works best when all the players have the same overall capacity to pay for things, and that's not how reality works out.

Societies prosper when efforts are made to make sure everyone has the foundations from which to build a productive life. That means health care, shelter, basic food and water, safety, capacity to get around (transportation of some sort), and access to information (education, libraries etc). If everyone has that stuff, they have the chance to add productivity to society rather than be a drain in the form of disease, crime, and so on.

You can still use pricing. In water for example you can use block pricing. Free water for the first X blocks and then increasing price.

The same could be done for electricity and other things.

Yes, block pricing makes sense. Prices are SUPER valuable as are other market dynamics! The same should be used for electricity and gasoline and many other things.

But the free-market dogmatists aren't interested in using markets and prices effectively, they are interested in their self-concept as people who really "get it" and understand all the complex dynamics of economics. Once you let messy ideas like externalities and market-interference/regulation like block pricing and on and on and on… this becomes very threatening to their identity as it pushes them toward having to say "gosh, it's so complex, and I don't understand it all".

Everything you said is contradicted by reality. Charities exist in the free market. The fee market pushes prices down more than any other system. Items that start out as luxuries quickly becomes affordable commodities. Wealth increases and abounds in a free market.

Charities do exist in the free market, yes. They are also a tiny tiny fraction of what's needed to address wider social problems. No charity efforts are comparable to or have the potential to replace something like Social Security and Medicare.

> pushes prices down

Except in the cases where it doesn't, such as luxury brands that exist to show off how expensive something is or for people to believe something is better because of the higher price — and this phenomenon is widespread throughout tons of aspects of the economy. Brands exist that sell essentially commodities at inflated prices through the power of advertising.

> Wealth increases and abounds in a free market.

According to the model you believe in, but that model isn't reality. Reality includes the fact that the wealthiest places on the planet (I mean larger societies, not places like off-share tax havens that just cater to the ultra-wealthy) have markets (but not completely free ones) and a history full of grotesque exploitation. The U.S. built it's initial wealth on slavery, genocide, and theft, and the non-free aspects of U.S. corporate behavior is still today a major factor of life.

You might indeed be right about wealth in truly free markets. But you don't have any controlled experiment on a society-size scale to even use for evidence since no case like that exists. And applying the ideas from one model to other situations doesn't mean it just becomes the model somehow.

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