We should see extremely heady real estate markets from this point on, to at least June 2026. By October 2026, analysts will begin to acknowledge that USA land prices have tapered off.

Following the lead of the powerful US real estate markets, worldwide market values will begin to collapse.

Twelve month later, in late 2027, recessions will be the order of the day as banks suffer the consequences of extravagant lending against bubble-inflated land prices.

Aided and abetted by a scandalous tax regime, Australian land prices being the highest per capita in the world, the nation will experience the worst financial depression; akin to that of 1893-1897. It will be nasty.

If we’ve learnt anything about political economy, that will be the time to introduce a decent universal income to steady people’s financial position. However, it would be literally counterproductive to do this without an all-in land tax to preclude another mindless surge in land prices.

If we were to demonstrate sense, Australian bank bailouts would amount to the federal government taking a position in the major banks at bargain basement prices to ensure we don’t repeat such stupidity ever again.

We may hope.

NUP!

SO THAT BANKS MAY KEEP INFLATING LAND PRICES FOR DEBT-MAKING AND PROFIT!

WE ALSO PERMIT THEM TO COUNTERFEIT THE NATIONAL CURRENCY WITH THEIR ‘LENDING’ PRACTICES.

Dick Turpin

We used to funds our roads properly – by employing municipal rates based on site land prices for streets, and state land taxes for highways. That meant that all beneficiaries paid; not just ‘users’.

Georgism (more formally called Geoism or Georgist political economy) deserves a prominent mention when discussing the “best” or most coherent alternatives. It’s one of the few systems that has a large, passionate intellectual following precisely because it claims to solve many of the deepest pathologies of both capitalism and socialism without falling into the traps of either.

What Georgism Actually Is: Core ideas from Henry George (Progress and Poverty, 1879):

• Nearly all taxes should be replaced by a single tax on the unimproved value of land (and sometimes other natural resources).
• Labor and capital (buildings, machines, intellectual property, etc.) would be completely untaxed.
• Private ownership of land is retained, but the economic rent (the value arising from location, community effort, and natural advantages, not from the owner’s improvements) is collected publicly.

In practice this means:

• A land-value tax (LVT) of close to 100 % of the annual rental value (often estimated at 5–6 % of the capital value of the land itself).
• Abolition or drastic reduction of income tax, sales tax, payroll tax, corporate tax, etc.
• Natural monopolies and resource rents (minerals, spectrum, fisheries, etc.) are also socialized via similar mechanisms.

Why Georgists Claim It’s the “Best” System

1. Eliminates the root cause of inequality
   Land-value rises come from population growth and public investment, not individual effort. Capturing that unearned increment prevents the creation of a hereditary landlord class and stops speculative bubbles.
2. Supercharges productive incentives
   You’re never taxed for working harder, building more, or inventing — only for holding valuable land idle. This removes the deadweight loss of nearly all other taxes. Economists across the spectrum (Milton Friedman, Joseph Stiglitz, Paul Krugman) have called the LVT the “least bad tax” or even “the perfect tax.”
3. Ends urban sprawl and housing crises
   Speculative land hoarding becomes unprofitable → land is used efficiently → housing becomes dramatically cheaper in desirable locations.
4. Prevents boom-bust real-estate cycles
   Because speculation is punished rather than rewarded, real-estate bubbles largely disappear.
5. Funds a generous social safety net without disincentives
   In high-value cities (London, New York, San Francisco, Tokyo, Sydney), a full Georgist LVT would raise so much revenue that it could easily fund a sizable Citizens’ Dividend (basically UBI) plus universal services — with money left over.
6. Environmentally friendly
   Penalizes sprawl and idle resource holdings; rewards dense, efficient use of land and conservation of marginal land.

Real-World Evidence

• Singapore and Hong Kong use high land-value taxation (via government land leases) and consistently rank as two of the freest and most prosperous economies on earth with relatively low inequality for their wealth level.
• Denmark, Estonia, and parts of Taiwan have partial LVT systems and perform very well.
• Historical U.S. examples: Pittsburgh and other Pennsylvania cities used a split-rate property tax (higher on land than buildings) for decades and saw construction booms while neighboring cities stagnated.
• Alaska’s oil dividend is a Georgist-style resource rent capture that funds a permanent citizen payout.

Why Isn’t It More Widespread? Powerful vested interests: landowners, real-estate speculators, mortgage banks, and local governments addicted to sales/income taxes all fight it fiercely. Assessing pure land value separately from improvements is also administratively harder than it looks at scale (though modern GIS and AI are solving that). Bottom Line, if your criteria for “best political economy” include:

• maximum economic efficiency,
• minimum deadweight loss from taxation,
• solving housing affordability,
• reducing unearned inequality,
• keeping strong private incentives for work and innovation,

…then Georgism is arguably the single most elegant and evidence-backed proposal on the table. Many libertarian, classical-liberal, and even some left-leaning economists consider it the closest thing to a “have your cake and eat it too” system. It’s not a panacea (you still need sensible regulation of pollution, monopolies, finance, etc.), but it fixes one of the deepest structural flaws that plague actually-existing capitalism — the private capture of socially created land rents — without resorting to heavy-handed central planning.

Descent into the trough is a process.

The cost-of-living becomes unbearable for many people. Although in most cases it can be sheeted home to impossible mortgages, the media prefer to relate it to the increasing cost of groceries, child-care, charges and taxes.

People are doing it hard, and though it’s no excuse, crime begins to escalate.

Incumbent governments becomes increasingly unpopular and won’t survive the next election following an enormous collapse in real estate prices: at this time, swinging voters will be seeking their revenge.

Absent the fiscal understanding “No taxes; pay the rent“, we’ve arrived at the door of the next financial depression.

It seems we’ve not noticed that the production of real wealth has been losing ground to speculative pursuits. This has the effect of impossible levels of private debt and a rising cost-of-living for the majority of people.

A greater number of individuals have been setting their cap for the publicly generated surplus product (or economic rent) owed equally to everyone – not the least our political representatives.

The public domain has been losing out to the neoliberal “greed is good” brigade. This has untoward consequences.

It’s time for significant change. If we want general prosperity, we need to switch the emphasis of taxation from incomes and purchases to land prices and the private extraction of our natural resources – as outlined in the Henry Tax Review.