Libertarian argument against LVT collapses

This comment turned up in a discussion group last week…

“Rothbard (a leading prophet of neo-Libertarianism) addressed LVT and its bad consequences very nicely

“Therefore, the market will no longer be able to insure that these locations will go to the most efficient bidders. Instead, everyone will rush to grab the best locations. A wild stampede will ensue for the choice downtown urban locations, which will now be no more expensive than lots in the most dilapidated suburbs.

“There will be great overcrowding in the downtown areas and underuse of outlying areas. As in other types of price ceilings, favoritism and “queuing up” will settle allocation, instead of economic efficiency. In short, there will be land waste on a huge scale. Not only will there be no incentive for those in power to allocate the sites efficiently; there will also be no market rents and therefore no way that anyone could find out how to allocate sites properly.”

Which is to ignore the minor point that occupancy of a valuable site will carry with it a very large LVT bill every year. How it that credibility is given to people who make such obviously stupid assertions?

The single tax and its economic and moral implications: http://mises.org/rothbard/georgism.pdf