Land Value Tax, Henry George, and the Case Against Speculation with James Cusick

About this Episode

James Cusick is a former software engineer from AT&T Bell Laboratories and Columbia University adjunct who found his way to property tax policy through an unlikely path: walking past the Henry George School in his Manhattan neighborhood. That chance encounter led him to build a suite of analytical tools that model what would happen if jurisdictions replaced their entire tax apparatus — property taxes, sales taxes, wheel taxes, fees, licensing costs — with a single tax on land value. His findings are provocative: a 6.92% land value tax could fund New York City's $125 billion budget with no deficit and no other taxes whatsoever.

The central tension James raises is one that every assessor lives with daily but rarely names aloud: the value of land is overwhelmingly created by the community, not the landowner, yet our tax systems treat land and improvements as a single bundle — rewarding speculation and penalizing development.

The Single Tax Isn't as Radical as It Sounds

Henry George's 19th-century proposal for a "single tax" on land value gets dismissed as utopian by most policymakers. But James has done the math, county by county, for all 3,200 counties in the United States. His Land Value Tax Calculator lets anyone pick a county, set a hypothetical rate, and see whether it covers the jurisdiction's actual budget.

The results are surprisingly plausible. For Hennepin County, Minnesota, or New York City, a modest land value tax rate replaces not just property tax revenue but sales taxes, fees, and assorted lesser levies. The administrative simplification alone is staggering. James points to Singapore, which uses a similar approach: their tax payment portal is essentially "pay here" with no deductions, no complexity, no armies of compliance staff.

For assessors, this reframes the conversation. The question isn't whether land value taxation is theoretically elegant — it's whether the administrative burden of our current patchwork system is justified by its outcomes.

Speculation Is the Real Enemy

James is at his sharpest when discussing land speculation. He describes a pattern familiar to anyone who has walked through Brooklyn or Detroit: developers buy parcels, hold them as empty lots littered with beer bottles and broken glass, and wait — sometimes a decade or more — for surrounding values to rise enough to flip or assemble larger sites.

The current property tax structure enables this. Taxes on vacant land are low enough that holding costs don't force action. A land value tax changes that calculus entirely. When the tax burden falls on the land itself rather than what's built on it, sitting on an empty lot becomes expensive. Landowners face pressure to develop, sell to someone who will, or watch their returns erode.

Detroit's recent adoption of a modified land value tax is a direct response to this problem. As the city's population shrank, abandoned properties proliferated while infrastructure costs remained spread across the same geography. The land value tax approach pushes owners toward productive use — not through regulation or cheerleading programs, as James puts it, but through straightforward economic incentive.

Community-Created Value Belongs to the Community

The philosophical core of James's argument is simple: when a subway line, a park, or a zoning change increases your property's value, you didn't earn that increase. The community did. The High Line in Manhattan is a textbook example — an abandoned rail line restored as a public park that generated enormous private land value gains along its corridor.

James describes the Henry George School's subway tool, which maps property values along New York City transit lines and shows the predictable gradient: values cluster highest near stations and decline with distance. The proposed Brooklyn-to-Queens subway line will create the same effect. Without land value capture mechanisms, speculators will buy up parcels along the route, price out residents, and pocket gains that public investment created.

This isn't abstract theory. It's the daily reality assessors document every revaluation cycle — watching values shift based on infrastructure investments, rezoning decisions, and neighborhood improvements that have nothing to do with individual property owners.

The Pragmatist's Path Forward

James is careful to distinguish himself from Georgist purists. He acknowledges that homeowners reasonably want their property to appreciate. He's a property owner himself — a condo in Osaka and a country house in the mountains — and he understands the personal stake people have in real estate values.

His pragmatic position is that jurisdictions don't need to leap to a pure land value tax overnight. Split-rate taxation, land value capture around transit investments, public-private partnerships like Battery Park City's 99-year lease model — these are incremental steps that move in the right direction. He points to Japanese rail companies that develop housing, retail, and commercial properties along their own lines, capturing value they help create. Some of these companies are now bringing that model to Texas and Virginia.

For assessors considering how to engage with this conversation, the practical entry point matters more than the theoretical destination. Separating land and improvement values in assessments — something many jurisdictions already do — is the essential prerequisite for any form of land value taxation.

Key Takeaway

The tools already exist to model land value taxation at every scale, from individual counties to the federal budget. What's missing isn't data or methodology — it's the willingness to confront a system that rewards holding empty lots and punishes building on them. Assessors are uniquely positioned to lead this conversation, because they already know what the land is worth and what the improvements are worth. The question is whether anyone upstream is ready to act on that distinction.