Land Reform, Not Tariffs: Why Government Should Be Funded by Unimproved Land Value Rather Than Import Taxes

      Tariffs should not be increased; but rather, eliminated.
     For one, increased tariffs against other countries hurt American consumers; that's because the tariffs are paid by the domestic American company that imports the goods. Some people reason that importers like that will pass costs on to the foreign company that exports the goods; while that is true, costs are also passed on to the people who buy the imported goods (i.e., American consumers).
     Secondly, general tariffs on the importation of goods, do not punish foreign exploitation of labor as they are intended. If we, in America, want to punish the exploitation of foreign labor by foreign countries and companies, then we should consider "labor tariffs", which do more to achieve what advocates of tariffs sometimes claim to want. Yet nobody is using the phrase "labor tariffs" at all.

     But if our goal is to keep low-quality products out, then we should impose quality controls, and perhaps higher fees (if necessary) to pay for more thorough inspections.

     Ordinary tariffs (i.e., taxes on the importation of goods) don't solve either exploitation of workers or low-quality goods. They only make low-quality goods more expensive for American consumers to buy and for American importers to import.

     Even if tariffs could be proven to be a good or necessary thing, to increase tariffs before increasing domestic production would be to put the cart before the horse.
     That's because those tariffs usually trigger retaliatory tariffs on U.S. goods by foreign countries, resulting in more retaliatory tariffs by the U.S., and so on and so on; resulting in an inflationary spiral (that is, more expensive goods for everyone, at home as well as abroad).

     And, since domestic production is down (which is the reason people want tariffs in the first place), that will leave Americans prematurely starved for low-cost goods imported from China, and in desperate need to start ramping-up domestic production again, as quickly as possible.

     Granted, domestic production is probably about to go up (or so the Trump Administration thinks). But others - such as myself - are not so sure about how it is that production is going to go up, given other ongoing problems.
     For one, the Trump Administration might be deporting many undocumented immigrants. How many workers will be deported in the process? And how will that affect our labor force's ability to produce?

     Additionally, there is an ongoing drought in the Western United States. It's possible that America's ability to harvest a sufficiently abundant amount of food in the few coming years - and other problems related to the misallocation of land and water - could cause deficiencies in feeding the American people (and in the countries where people buy American-made food).

     It's possible that the Trump Administration is overestimating America's capacity to start producing again quickly.

     Before considering increasing tariffs, we should simply do what tariffs intend to achieve; that is, we should increase production at home.

     But we should do it without giving into the kinds of financial fraud and environmental devastation and labor exploitation that the Republicans and the neoliberal Democrats tolerate (and sometimes even spearhead).
     And we should also do it without resorting to tried-and-failed old methods of sourcing tax revenue which unduly punish productivity and make goods unnecessarily expensive.

     That is why we need Georgism, the "Single Tax" on unimproved land value.

     This tax on non-improvement of land, should include taxes on the owners of abandoned construction projects, large swaths of land, land rendered unusable for others due to blight or hazards, and land speculation by large banks and land developers.

     Land Value Taxation - and split-value taxation (wherein buildings are taxed at a lower rate than land) - would allow ordinary people to engage in untaxed (or minimally taxed) production, in their homes and garages and on their front lawns. It would also help reduce landlessness for the average person.

     These taxes will make land cheaper overall. This will make it cheaper to mix labor and capital upon the land, for productive use, and it will end and replace taxes on production (including tariffs and sales taxes).

     However much the Trump Administration brings production back from abroad - and whether the administration sticks to their tariff plans or not - there is plenty that we can do, here at home, to help bring back production.

     Land Value Taxation will allow us to do this; by simplifying and streamlining our tax code, so as to stop punishing productivity by the average property owner (while making it easier and cheaper for the average tenant to become a property owner).

     Increasing property ownership by American residents, will also help prevent something that many Americans (especially those living in the Western United States) fear; that too much land in the continental U.S. could be sold to Chinese property owners, developers, and/or speculators.

Written on February 2nd, 2025

Edited and expanded on April 14th, 2025