The Roots of Gentrification in New York City

[@nthperson]

What I learned during a 40 year career in helping to put together public-private financing initiatives for revitalization of distressed and under-served communities is that the main cause of decline in the first place is a tax structure that rewards speculation in land over investment in job-creating capital goods. At the local level the main cause is the conventional property tax. The property tax is almost universally administered to foster land speculation by infrequent and inaccurate assessments. Buildings, which are depreciating assets are over-assessed. Land is generally under-assessed. Thus, the incentive to property owners is to hold land idle in anticipation of rising land values (reducing the supply of land available for development, and thereby artificially pushing up land prices even higher). All one needs to do is walk the streets in a city's central business district and nearby neighborhoods and count the hundreds of buildings that sit vacant or as empty lots. The proliferation of surface parking lots is another clear indication of a counter-productive tax structure. And, in neighborhoods populated by lower-income households, the incentive is to put as many people as possible into housing units, defer maintenance and wait for a government-funded revitalization effort to come along to purchase the land or at least stimulate the demand for land by developers seeking to attract higher income households. When gentrified, where to the low income individuals go; often, they go into the streets or the growing tent cities that plague most of U.S. cities. The optimum rate of taxation on buildings is actually zero. The annual taxation of a building amounts to the imposition of a sales tax year after year after year. The optimum AMOUNT of taxation on a parcel or tract of land is the potential annual rental value of the location, a value that exists independent of what the owner of the land does or does not do with the location. This value is societally-created and is a function of locational advantages, advantages in a town or city that are created by aggregate investment in public goods and services. It is the failure to collect the location rental values that rewards antisocial behavior on the part of property owners. When will those who govern and our civic leaders wake up to this reality? Edward J. Dodson, Director School of Cooperative Individualism www.cooperative-individualism.org

[@blackdaylight]

So many excellent points, such a thoughtful guest...not surprised that two people having an intelligent conversation doesn't have millions of views, but we gotta change that

[@LauraFlandersAndFriends]

Thanks for the kind words +blackdaylight. We definitely gotta change that!

[@limocro1]

Two national treasures talking about things that truly matter. So glad I stumbled on to this while watching the Westminster Dog Show. Go figure. I love Sarah Schulman and am increasingly impressed with the lovely Laura Flanders.

[@errolthomas9426]

Whenever I walk through the LES, I shake my head in disgust looking at how Hipsters and Yuppies made it look boring. Especially in Chinatown and Little Italy.

[@Retr-bb8zf]

The hipsters & millennials are our problem we need to take back NYC for the working class men & women

[@TheYoli182]

Retr0 Sad to say it but that's not gonna happen. New Yorkers became a passive observer.

[@errolthomas9426]

@@TheYoli182 Fifty to one hundred years from now gentrification won't continue

[@anatejada1100]

The way NYC is going, looks like neighborhoods are gonna have Starbucks and Chase on every block because the rents are ridiculous! Small businesses/mom and pop restaurants is what makes NYC different