Why is that bad? A family lived in the city for generations, and now due to the tech boom and a property bubble they should be forced to move?
It makes a hell of a lot more sense for FAANG to open offices somewhere else.
It makes a hell of a lot more sense for FAANG to open offices somewhere else.
You can sensibly critique Proposition 13, but calling it "feudalism" is nonsense. It's the opposite, it's basically carving out a limited exemption in a partially feudal system for some citizens over others. Is it dumb? Sure, unequal? Definitely. But it's not "feudal", it's making the system less so.
- The owner of land owns it outright. If you own land, you don't pay taxes on it to anyone. It's yours.
- Ownership of land is inalienable. Your land is yours, and you can't sell it or otherwise transfer ownership (except through inheritance).
- Land generates revenue through the collection of dues from peasants who would like to work it.
- The feudal dues associated with a stretch of land are fixed by tradition and, like the ownership of the land, can't be changed. This is why European peasant reform movements emphasized stable measurement units so heavily -- since lords couldn't change the nominal amount of feudal dues, changes were actually implemented by messing with the size of the units those dues were measured in.
- The king has no tax authority. He gets his revenue from the land he owns, just like every other noble does.
It is a radically decentralized system, even for the rest of the world at the time, and it reflects the very low level of societal development in feudal Europe.
The US property tax system is nothing like this. The government owns ALL the land, and no one else can ever own any. The government has tax authority over the land and many other things.
The proposition 13 system does look like it's trying to move things in the direction of feudalism, as far as I can see. It's even trying to make sure land can't be sold, in that when you sell your land, all the tax benefits are lost.
Generally, nobles held land under "feudal tenure" and not "allodial tenure" (the latter is "outright" ownership). Under feudal tenure, the noble did not owe taxes but they did owe "service" which they could try to make up with goods and money instead.
The service was onerous. Generally, showing up with a sword and shield and an army fitting your station.
https://en.wikipedia.org/wiki/Feudalism_in_England#Varieties...
Along with the main service there could be many more specific services. One example of many: in the present day, there is a noble family in England that is required to set out three glasses of Brandy or Cognac or another strong spirit on a certain holiday, so that the reigning monarch may come by and drink them if she so chooses.
Just a quibble, but, with the exception of federal lands, it's the individual states that levy property tax in their territory. Allodial title is what it's called when you have no obligations on the property. Nevada allowed limited allodial title, but it only lasts for the life of the owner. The way the implemented it was they computed an estimated total property tax and the owner would buy out the state's interest for his lifetime[1]. It actually provides additional privileges besides property tax exemption. Liens can't be enforced on an allodium, among other privileges.
For having "no obligations on the property", those are some pretty substantial obligations.
It was never a requirement of feudalism that a land owner had 100% control over their land. Most feudal lords had a greater lord that expected tribute and support during war. In this metaphor land owners would be the lesser lords, not the king.
I've seen the counterpoint sentiment in this thread described as "right to place". Some have a deep instinct to want to stay where they grew up and continue to build it. Maybe we should find a way to support that dream as well as the needs of people moving from outside to take advantage of the growth produced by their predecessors, instead of vilifying anybody who has something we want.
Otherwise you end up with an entirely transient population with little sense of ownership, responsibility, or community.
Out of my high school class, people who stuck around are actually somewhat uncommon. I mean, there's obviously still more there than any single other metro, but surprise surprise, most have moved somewhere much cheaper.
With saner density/zoning regulations, rents would be low enough to where more would have been able to stick around. Instead, very few have.
The current setup benefits homeowners who get in early. Their kids may well eventually benefit by inheriting that house, but in the meantime they've probably lived at least a few decades as adults elsewhere.
In California, it's all properties. Regardless of purpose. You can inherit dear old dad's office building and its tax assessment.
Taxes are less intrusive than say being press ganged to spread asphalt on I80 at 2am for a couple of weeks.
At least for me.
Under feudalism is actually when legal systems began to recognise allodial title as such. To the old fashioned kings, "land to which you have an absolute title" was just "land I haven't conquered yet".
When people talk about feudalism here, what they probably are referencing is the defacto inalienability of property under feudalism, and the consequent emergence of a small landed class who enjoyed revenues from a large labouring class.
The inalienability and concentration was not due to one law or institution, but typically several together. Some wills outright forbade the inheritor to sell any of the property, if they accepted the inheritance. In some parts of Europe, all of the property was inherited by one son -- primogeniture -- tending to concentration.
It was never the case under feudalism that there was no way to move into the landowning class -- some families moved in and some out -- but in practice families with land could very easily retain it. This changed only with the emergence of widespread trade and then industrialism, because these introduced much better ways to generate revenue from labor and led to a situation that might seem bizarre to us: poor gentry with vast landholdings and no money, and no way to generate revenue from the land since they couldn't invest in it, and no way to get outside investors because it was always "heads I win, tails you lose" when it came to collecting on the only asset of value the gentry had, the land.
What California is doing really is feudal, in the sense of encouraging the concentration of landholdings in a semi-permanent group of families.
This history lesson really falls apart when you consider what preceded feudalism for the average person in medieval Europe, or what happened in parallel in other societies outside of Europe that never experienced feudalism.
In both cases it was the norm in agrarian societies that farmsteads would be owned by the same family for generations. Re-establishing that is the main effect of Proposition 13.
What legal situation in Europe or elsewhere are you actually describing? Many agrarian societies were imperial. Pre-feudal Europe involved a mix of Roman institutions and tribal institutions, and tribal societies generally have a vague concept of land ownership. Maybe you’re thinking about the Old West?
You can own a dog, but that doesn't mean you're allowed to beat your dog. And if you beat your dog, the state may well come in and take it away (and also jail you).
Those homeowners seem to have a majority in the area. Seems moronic to run a trillion dollar company at odds with the local government.
NYC has an income tax. I bet SF will have one within 5 years.
For inheritances, you re-assess and consider it a sale. If the price went up lots, the kids can pay the tax and keep it, or they can sell the property and pay off the taxes.
But governments that try to get between families will end up on the loosing end. What inevitably happens is that the rich get loopholes and the middle class pays. At least in California everyone gets the same deal.
If you can get all the Google engineers to go on strike unless Mountain View agrees to build 50,000 homes, it will be done over night.
I'm not trying to explain housing prices here. I'm talking about the innate behaviour of Prop 13.
Why? What entitles someone to being in a certain location?
Also you get paid an enormous amount of money to move when the property value gets so high that you can't pay the percentage in taxes.
Go buy three houses somewhere else and don't pretend you're oppressed.
If we were regularly pushing people out with huge paydays, and then putting in denser housing, they'd be able to afford to move right back in with the only downside being a smaller yard to offset their pile of cash. And people that didn't win the housing lottery would be able to move in too.
If your taxes go up like crazy because property value increase, are you out of luck (like most other places), or do you get to keep a lower tax rate? Because I'll admit, being kicked out of the house you bought because rates skyrocketed and all of a sudden you can't afford it anymore kind of sucks. I live on the east coast, and just 2 years after I bought a place, my taxes basically doubled. I'm privileged enough that I was able to absorb it, but most people wouldn't be able to. Coupled with a bunch of heavy repairs I had to do shortly after getting the place, plus realtor fees, most people wouldn't even have been able to afford selling it, either. So bankruptcy they'd have gone.
One could say you should be sure you can absorb these hikes before you buy, but these are spikes that someone somewhere in city hall signed off on, not some kind of unpredictable random bad luck (the tax hike, not the repairs)
> It makes a hell of a lot more sense for FAANG to open offices somewhere else.
Network/ecosystem effects are a natural part of economies and businesses. Why don't we leave it more up to businesses to decide where to hire?
Besides, the current setup is manifestly harmful to any non-homeowners and recent homeowners as it is. Why support a system that strains budgets, kicks out the poor and renters, hurts the environment, and forces long commutes?
It's even got the limits you suggest baked in - only residential, only primary residences, requires high equity ratio, etc.
I think a simpler solution would just be: you may choose to lock in a lower/earlier assessed property value for the purposes of property taxes, with the caveat that the state gets right of first refusal at the assessed value when you decide to sell.
Bam! One and done. Grants flexibility, too; each household can decide whether to treat their house as an investment or as a home, but not both.
At that point the state has the ability to get their money from any future sale without the extra complexity of having to own the property.
Right now two different families living in identical properties in CA can be paying vastly different property taxes depending on when they bought (or inherited) their house. This is manifestly unfair.
My house being more expensive than next door's doesn't mean Im a bigger burden on the city. The only reason it kinds of sortoff make sense is as a proxy to income.
So why not just have everyone pay taxes based on residency (those who get to vote and receives city services), like we do for federal/state taxes? And if someone owns property and don't live there (investment), then their burden should be from it being an investment and be kind of unrelated.
Only (albeit significant) hiccup is maintenance of the property and the responsibility of the owner via the city.
But in a high demand area with constrained supply, it's more of a supply & demand model: landlords charge what the market will bear, which is mostly based on how many people there are around with decent/high-paying jobs. Prices haven't risen rapidly in recent years because the actual cost of building housing rapidly increased, obviously.
So using the latter model, increased property taxes probably wouldn't have much impact on rent prices.
The other poster explained it better than me, but basically it's too indirect. A renter sees rent go up, but not always why it goes up. We had that happened in our city, where people voted for an exceptional tax increase, which immediately got passed down in rent increases, and then people complained about -that-, not making the obvious link.
Cities don't usually have a profit motive, can you name cities in booming areas that you think are 'extorting' money and wasting it?
I doubt we'd have any workers paid through property taxes if we were paying like it's 1955.
The cumulative effect of prop 13 has been to create a landed aristocracy in California cities who have millions of dollars in real estate and pay almost nothing on it purely because of who their parents were. This situation is even worse when the real estate is rentable, and the owners can collect 2019 rent and pay 1970 tax rates.