Contribution to GTI Roundtable "Common Wealth Trusts"
Peter Barnes’s viewpoint on creating common wealth trusts to compensate for key failings of the market economy offers intriguing ideas for further exploration. Others see these market failings and rail against the system, noting that the tragedy of the commons has nearly run its destructive course. Barnes observes instead that, despite its devastating failings, the market economy still has potential to act as an efficient, effective vehicle for change. He suggests that we fundamentally alter the way we treat our common natural and social resources by creating structures and entities whose sole aim is to protect, track, and monitor these resources for current and future generations. In his vision, we do this not by doing away with the market economy, but by fashioning new frameworks within the current system to house the resources that have up to this point been externalities.
As we near multiple ecological tipping points, it is increasingly obvious that the current market economy lacks adequate protection for our natural resources, and thus for future generations. Human activities have altered the chemical composition of our oceans, changed the molecular mix in our air, and depleted resources to the point that our continued survival—never mind our economic well-being—is at risk. Also clear is the fact that today’s market system is failing our lower and middle classes. The social mobility promised by the American Dream is far more dream-like than it is an American reality, and the flow of wealth appears to be mostly a one-way affair.
Yet, there are common environmental and social resources that every class and every generation should be able to count as sources of wealth. These include clean air and water; productive ecological systems; the Internet; and the vast networks on which we depend for transportation, energy, and financial services. The current market economy, left unchecked and based on the faulty premise that common resources are unlimited and up for grabs, allows those with the right equipment to reap the benefits of those assets without compensation to their common owners. Barnes provides an approach that both counterbalances this use of resources and allocates their benefits across the population.
I look forward to seeing Barnes and other collaborators develop a detailed pathway to achieving this market transformation. To move from vision to reality, his viewpoint will take a good deal of hard work and planning—even when working within an existing system. It will likely face difficult hurdles and require extreme creativity. Nonetheless, achievement of the market transformation outlined by Barnes could help shift our trajectory towards one of true sustainability.
Barnes provides multiple examples of existing trusts that can serve as models for new organizational structures for common wealth. These include the Alaska Permanent Fund and various land trusts, and they demonstrate that working mechanisms are readily available for the more tractable problem of how to hold sources (land, minerals, fossil fuels) in trust for all. The problem of how to hold sinks (reservoirs for our wastes—such as the atmosphere’s absorption of carbon dioxide emissions) in trust may prove far more difficult to arrange, monitor, and enforce. Sinks cannot be treated the same as material resources and will require different mechanisms.
Another hurdle we can expect to have to clear is the political implementation. Barnes’s loss of faith in achieving solutions through political change likely resonates for many readers. At the same time, it raises a sticky practical issue for the execution of his vision. It is difficult to imagine how a system of common wealth trusts can be achieved without using our political system to put into place and maintain the new financial structures that he describes. As tempting as it is to try to write our political system out of the equation, we will likely need to continue to wade through the morass of political mechanisms that shape our decision-making processes.
Practical barriers notwithstanding, the kernel of Barnes’s vision—that of shaping and molding our existing market economy system to better protect common resources through the creation of common wealth trusts—holds great promise and sparks hope for a fairer and more sustainable future. I look forward to seeing substantial progress made on creating a practical and tangible pathway to implementation.