same rules that
regionally can also be applied
best to organize commons
at the lowest level possible;
the scale of
commons is so large
that the management
structure must be national
or international. Here
AN AMERICAN PERMANENT FUND
An American Permanent Fund would be the centerpiece of the new commons sector
proposed in this volume. It’s a way to fix, or at least ameliorate,
capitalism’s flaw of concentrating private property among the top
5 percent of the population. It would do this, like the Alaska Permanent
Fund, by distributing income from common property to every citizen equally.
This would add a third set of “pipes” through which income
would flow to Americans, the first two being wages and private property
As discussed in chapter 7, the American Permanent Fund’s income would
come in part from the sale of pollution permits — mostly for carbon
dioxide — and in part from the commons’ share of corporate profits.
The first revenue source would be directly correlated to our efforts to curb
global warming. If we decided to reduce carbon dioxide emissions, say, by
3 percent per year for the next three decades, as scientists say we must,
this would generate a substantial flow of income into the American Permanent
Fund. Some of that might be invested or spent on public goods, and some would
be used for per capita dividends. The faster we reduced emissions, the higher
these dividends would be. In effect, the dividends and public goods would
be a bonus to Americans for doing the right ecological thing. Eventually,
when a post-carbon infrastructure is built, carbon emissions would stabilize
at a low level, and so would this revenue source for the American Permanent
Fund. By this time, the second revenue source — dividends from holding
a portion of publicly traded corporate shares — would kick in. This
revenue source would give every citizen a stake in increasing corporate profits,
just as the first source gives them a stake in decreasing pollution. Who
could object to that combination?
Getting the Permanent Fund up and running, even if it starts small, would
be a crucial precedent and signal. Like the Social Security Trust Fund, it
would be a pipeline through which more money would flow over time. It would
establish a fundamental principle for the commons sector — one person,
one share. And it would change the way Americans think about our economic
relationship with nature: every penny not paid by a polluter would be a penny
out of everyone’s pocket. It wouldn’t be just future generations,
then, who experience a loss when nature is degraded; the bank accounts of
living Americans would suffer as well. Irresponsibility toward the future
would carry an immediate and widely felt price.
THE CHILDREN’S OPPORTUNITY TRUST
The Children’s Opportunity Trust is the second big piece of national
commons infrastructure. It’s a way to fix capitalism’s other
bad habit of perpetuating class privileges from one generation to the next.
Unlike feudalism, which was based on hereditary aristocracy, capitalism is,
in theory, a meritocracy, or at least a “luckocracy.” Players
are supposed to have a fair, if not equal, chance to succeed. Winners are
supposed to be determined by hard work, talent, and luck, rather than by
accident of birth. Yet, as we’ve seen, Capitalism 2.0 falls far short
of this ideal.
The Children’s Opportunity Trust would give every child, as a birthright,
an infusion of start-up capital — a kind of Social Security for the
front end of life. The trust’s revenue would come from end-of-life
repayments, as explained in chapter 7. This funding mechanism, I believe,
is better than taking money from the general treasury. It directly links
start-up help from society with an end-of-life obligation to repay, creating
a kind of temporal commons that connects arriving and departing generations.
A SPECTRUM TRUST
A spectrum or airwaves trust would have a distinct mission: to reduce the
influence of corporations on our democracy. Its economic and ecological
impacts could be significant (reducing corporate political influence will
improve many policies), but they’re secondary to the political objective.
According to a study by the New America Foundation, the market value of
the airwave licenses we’ve given free to corporate broadcasters is
roughly $500 billion. It’s possible this value will decline as unlicensed
wi-fi spreads, but meanwhile broadcasters sell our airwaves to advertisers
and reap billions that belong, at least in part, to all of us.
Part of that money comes from political candidates who must purchase TV
and radio ads to get elected. The problem isn’t so much the unearned
windfall broadcasters collect; rather, it’s the fact that candidates
are compelled to pay it to them. That makes politicians kowtow to corporate
donors in order to pay broadcasters. Other democracies give free airtime
to political candidates, but we protect the broadcasters’ lock on our
airwaves. By privatizing our airwaves, in other words, we’ve effectively
privatized our democracy. The job of a spectrum trust would be to take back
our democracy by taking back our airwaves.
This could be done in a couple of ways. One wouldn’t require an actual
trust: Congress could simply say that, in exchange for free spectrum licenses,
broadcasters must give a certain amount of free airtime to political candidates.
Alternatively, broadcasters could pay for their licenses, with revenue going
to a nonpartisan trust. That trust would allocate funds to candidates for
the purchase of TV and radio ads; the allocation formula would take account
of cost differences between media markets and other relevant variables. Neither
of these approaches would prevent corporations from lobbying or contributing
to candidates’ other expenses, but they would level the political playing
field by greatly reducing the sums candidates have to raise to get elected.
COMMONS TAX CREDITS
Some commons trusts will generate income from the sale of usage permits.
Many others will need income to acquire property rights, restore degraded
habitat, or give children start-up capital. It’s therefore essential
to encourage a multiplicity of revenue sources. The best way to do this
is through a federal commons tax credit.
When I was in the solar energy business during the 1970s, our customers
benefited from a combination of federal and state solar tax credits. As I
frequently explained then, a tax credit isn’t the same as a tax deduction — it’s
bigger. A deduction is subtracted from the amount of income subject to tax;
if your marginal tax rate is 30 percent, a tax deduction saves you thirty
cents on the dollar. By contrast, a tax credit is subtracted from the amount
of taxes you pay, regardless of your tax bracket. If you owe taxes, it always
saves you one hundred cents on the dollar.
The premise behind a commons tax credit is that wealthy Americans owe more
to the commons than they currently pay to the government in taxes. That being
so, a commons tax credit would work like this. The federal government would
raise the uppermost tax bracket by a few percentage points. At the same time,
it would give affected taxpayers a choice: pay the extra money to the government,
or contribute it to one or more qualified commons trusts. If people do the
latter, they get a 100 percent tax credit, thereby avoiding additional taxes.
The message to the wealthy thus is: You have to give back more. Whether you
give it to the IRS or directly to the commons is up to you. If you want to
eliminate the government middleman, that’s fine.
What qualifies as a commons trust? It’s a trust that either benefits
all citizens more or less equally or collects money to restore an endangered
commons. Social Security, the American Permanent Fund, the Children’s
Opportunity Trust, and most land and watershed trusts, would qualify. By
contrast, a normal charity would not.
Contributions to normal charities would remain deductible from taxable income,
but not from taxes owed. ... read
the whole chapter