Contribution to GTI Roundtable "Common Wealth Trusts"
Thanks to Peter Barnes for the concise description of his thesis. I would like to weigh in on two points, one theoretical and the other practical.
First, economist and political philosopher David Ellerman has pointed out that two of the major types of ownership we would like to see more of—employee ownership and trusts for common wealth—are linked theoretically as positive and negative applications of the Labor Theory of Property. As a principle of natural law (articulated by John Locke, John Stuart Mill, and Henry George, among others), LTP implies that one has an exclusive claim to ownership of that which one has created, and that one has as valid a claim as any other person to ownership of that which no one has created. The employee ownership crowd and the commons trusteeship crowd generally run in separate circles, but there is a solid theoretical basis for considering themselves natural allies and working together.
Second, I would like to share some thoughts/notes on prospects for capturing different types of common wealth in trusts.
Natural resources are “low-hanging fruit.” Since trusts based on extractable resources are easy to conceptualize, and thanks to the living example of the “Alaska model,” a good deal of scholarship has been done on prospects for harnessing renewable and non-renewable resources in trusts. To cite just one encouraging study, Paul Segal demonstrates, using World Bank figures, that dividends based on rents from fifteen types of natural resources, implemented nationally in developing countries, could effectively halve global poverty.1
Land values are also low-hanging fruit in the sense that we have a lot of experience capturing land values; we (partially) capture them (along with the value of buildings and other improvements, which are not part of the commons) in real estate taxes. But the fact that municipalities currently rely on land values for operating expenses means that there may not be a lot left to go into dividend-issuing trusts.
Resource sinks are conceptually more difficult sources of common wealth, but in the form of carbon tax-and-dividend, the idea is becoming more mainstream.
The broadcast spectrum and the monetary/financial system are two other resources that are often cited as sources of common wealth that could be captured in trusts. Often these examples are thrown around glibly, and I myself am guilty of this. In reality, they are not so simple.
I had the privilege of hearing Barnes speak at Harvard last year, and a Kennedy School professor in the audience with expertise in Federal Communications Commission affairs argued that the public airwaves are not as scarce (and therefore valuable) as is commonly supposed. The reality is that, given current technology, the broadcast spectrum could support virtually unlimited communications. The telecom behemoths play along with the FCC’s pretense that the airwaves are scarce to discourage other players from entering the market. If the public were to attempt to collect the alleged full value of the airwaves from the telecom companies, the pretense of scarcity and value might unravel. I have not seen this analysis confirmed in other sources, but it does give one pause.
Tapping the monetary/financial system would be difficult for a number of reasons: it is politically difficult to touch, it is complex and intertwined with every other part of the economy, and the waters are already muddy with a slew of reform ideas that range from good to crackpot. That does not mean it should not be attempted. The Social Credit movement may be a possible ally. Based on my current understanding, the SC program (which includes, among other interventions, distribution of credit to all citizens in the form of a dividend, to “top up” consumer demand, which would otherwise lag behind the supply of consumer goods) appears credible and does not appear to be incompatible with plans to hold other types of resource wealth in trusts, or to promote worker ownership. Indeed, the advertised outcome of the SC program (increased leisure and personal freedom, decreased material throughput) reads like an attractive Great Transition scenario. On the downside, the Social Credit program does not seem amenable to incremental implementation; it would appear to be an all-or-nothing solution.
1. Paul Segal, “Resource Rents, Redistribution, and Halving Global Poverty: The Resource Dividend,” World Development 39, no. 4: 475–89, www.sciencedirect.com/science/article/pii/S0305750X10001774.