Spencer Heath Archive

Item 1267

Carbon of letter from Heath to Harry Grant Atkinson, Managing Editor, The Appraisal Journal, 22 West Monroe Street, Chicago, Illinois

August 11, 1939

 

 

 

Dear Sir:

 

     I have to acknowledge receipt of the July number of your journal in five copies, for which I thank you.

 

     Please advise whether you can furnish reprints of the article, “Why Does ‘Valuable’ Land Lie Idle?” I should like to obtain, for free distribution, say, from 250 to 500 or even 1000 copies, preferably in pamphlet form similar to my “Why ‘Valuable’ Land Lies Idle,” if they can be economically obtained.

 

     Anent Mr. Schmutz’s article, I enclose two recent sales circulars from George M. Mayer, 2 West 40^th Street, New York, showing enormous discrepancies between assessments and cash sales prices in Manhattan and Brooklyn.

 

     The article by Mr. Morris on the “Economic Position of Real Estate” brings up a number of considerations affecting real estate values that are tremendously important. But since all value is, presently and ultimately, only the value of income, I think we should give prime consideration to changes in the gross production of goods and services, or the national income, as affecting real estate values. It would seem that all the other matters he considers may be regarded as important only as they contribute to this.

     With reference to a reasonable distribution of the tax load, it may be questioned if this load can be so laid as to develop a “constructive tax system.” To be constructive it must be worth more than it costs and thus be no load. It seems highly probable that all goods or services that are worth anything to those who pay for them are paid for without coercion or compulsion and that compulsive payments destroy values rather than create them. The possibility of obtaining necessary public services and security by voluntary exchanges instead of compulsions should be considered in any broad examination of this subject.

     In the matter of distribution of the compulsive load, I think it should be seriously weighed whether the paralyzing taxation now laid upon the use of real estate (which comprises all business and production) is not equally or even more injurious, in its direct and indirect effects upon real estate incomes and values, than the taxes laid directly on the property itself. Real estate can exist and burden its owners, as we so well know, when it is out of use and out of demand, but it can have no value to its owners except as its profitable use creates an effective demand for it. This aspect of the tax problem ought to be analyzed and examined. There is much ground for believing that every tax on production reduces its profits and then its volume and thus seriously cuts down the demand for and hence the value of all fixed capital.

     I observe that yours and other journals are taking considerable notice of population changes. This suggests that you might find of some interest an academic outline of basic principles that I have prepared for submission to the Population Association of America of which I am a member. I enclose copy of this with request for its return unless you should have some special use or desire for it.

Very truly yours,

   

    Spencer Heath

 

 

Encl.

Mayer’s lists

Energy Concept of Pop.