The Hidden Taxable Capacity of Land: Enough and to Spare

Summary

In this 2009 paper Mason Gaffney addresses the most common revenue objection to Georgism head-on: is there enough land rent to actually fund government? His answer is an emphatic yes. He argues that conventional estimates drastically understate land's taxable capacity by omitting categories of rent and by ignoring how the tax base expands once distortionary taxes are removed.

Key Argument

Gaffney enumerates "hidden" sources of land and resource rent typically left out of national accounts — including under-assessed urban land, the rental value of public land and natural resources, spectrum, and aviation/transport corridors. He further invokes ATCOR (All Taxes Come Out of Rent): because other taxes are ultimately borne by land rent, removing them causes land values — and thus the LVT base — to rise. The combined effect, he argues, is a rent base "enough and to spare" to replace existing taxes.

Standing and Limits

• Where it sits in the debate. This is the advocacy side's most systematic answer to the revenue-insufficiency objection — the objection page steelmans Krugman's and Blaug's doubts against it. The mainstream data side of the same question is carried by Larson's BEA estimate and Albouy's metro land values; the national companion calculation is Dwyer's Australian study.
• Claim class. Gaffney was a credentialed economist (UC Riverside) writing as a committed Georgist: the enumeration of omitted rent categories is checkable (C-claims); the "enough and to spare" conclusion leans on ATCOR, which is a hypothesis awaiting direct empirical test — the wiki reports the conclusion as Gaffney's argument, not settled measurement.
• Distinguish the papers. This 2009 paper is distinct from Gaffney's 2005 "Physiocratic Concept of ATCOR" essay, which states the base-expansion mechanism itself; the two are often conflated in citations.

Bears On

• Outcome: Land rent could fund government
• Objection: LVT can't raise enough revenue — the reply side
• Concept: ATCOR

See Also

• Dwyer (2003), Taxable Capacity of Australian Land — the national companion
• Larson (2015), BEA land value estimate — the official-data side
• Mason Gaffney

Sources

1. Mason Gaffney (2009), "The Hidden Taxable Capacity of Land: Enough and to Spare" — used for the hidden-rent enumeration and the ATCOR-based conclusion (C/D-claims, advocate-economist, attributed). PDF · 📄 Local copy
2. Complete free archive of Gaffney's work: masongaffney.org — used for the 2005/2009 paper distinction (A-claim).