In the last installment we saw that splitting a person’s distribution of ground rents down the middle, half for public goods and services such as police protection and sanitation and the other half for personal goods such as food and housing allows the toxic effects of the head tax and the toxic effects of an entitlement to cancel each other out at all levels of wealth and income. The distributions are not only equal but equitable as well.
We also saw that collection and distribution of the ground rents must be done at the Federation level because local collection and distribution would lead to gross inequality.
Finally we saw that if one were to picture the cellular democracy as a tree, with each individual or other sovereign a leaf of that tree, then the per capita distributions to every branch from trunk to leaf would be equal.
Distribution allocations for public goods and services are not requirements. For instance, suppose a cellular council at level 3 receives $4 per month per capita for sanitation. They might spend only $2/month/capita on sanitation and the other $2/month/capita elsewhere. If the level of sanitation is nonetheless acceptable, council members will not be recalled (for this reason) nor pressured to employ the full sanitation allocation.
If the average level 3 dominion were spending the full sanitation allocation and sanitation was inadequate in these dominions, the level 3 allocation for sanitation would need to be raised. Amendments to the allocations must be approved by a 2/3 plurality of the entire population of the Federation, in the same manner as amending the constitution itself.
Of course, economies of scale favor more efficient use of the allocations in dense urban areas. Extremely rural orphaned (in the tree analogy, an orphaned cell is a leaf that comes directly from a thick branch) cells of perhaps 5 people might spend their fire protection allocation on a water tower, their law enforcement allocation on some shotguns, and their sanitation allocation on two outhouses. However, the $370/month/capita allocation for housing directly to the individual or other sovereign (typically a family) means that even the population of orphaned cells on completely marginal land need not live so primitively.
Why an allocation of $370/month/capita for housing and $220/month/capita for food? Basic income advocates usually favor a simple per capita cash allocation. While a basic income in cash would be far better than anything that exists today, it has many shortcomings.
We saw that economies of scale provide more efficient use of allocations for public goods and services. The same is true, perhaps even more so, for family size. For a large family, a chef could prepare three fantastic meals a day on $220/month/capita, while a person living alone would barely get by on $220/month for food. A larger collective could support an upscale mansion with swimming pool and acreage for a housing allocation of $370/month/capita. A person living alone could afford only a very tiny studio on land far from the city center. These allocations promote the formation of large families and collectives in a way that cash never could. Perhaps the most important assertion of distribution theory is this: Allocation of personal distribution, leads to voluntary collectivization. Voluntary collectivization, leads to economies of scale. Economies of scale, lead to new divisions of labor. Divisions of labor, lead to new enterprise. Given a mutual organization of over 50 people, receiving per capita allocated distributions, it is almost impossible for that organization not to develop into a successful business given the human craving for productivity, assured survival, and the diversity of talent.
The economies of scale that naturally follow from the allocations lead to a new era in humanity: people are valuable. Rather than businesses bringing in more revenue for a jurisdiction (although they do so indirectly), it is people that are wanted by families, kibbutzim, counties, and nations. Each person carries with them an allocation for fire protection, an allocation for streets, an allocation for local government, an allocation for education (at level 5), an allocation for a special kind of medical insurance, and allocations for food and housing. People are wanted everywhere! “Come to our town”, “Join our collective”, “We welcome you with open arms”, “Immigrants wanted”, “Refugees wanted”. Can you imagine how different such a world would be from today? There would be no more involuntary loneliness. Environmentally caused mental illness would all but disappear, as would the scourge of domestic violence. While people will hoard cash for their own pleasures, it is natural for allocations to be shared. And everybody carries with them a basket of distributions as they move from place to place.
Here is a sampling of more reasons why distributions should be allocated. It should be required reading for every basic income advocate whether pro or con allocations.
1. The right to life for children includes the right to nutritious meals. Though the intention of most parents is to provide for their children, a few would be tempted to spend the money elsewhere. The best way to insure all children are receiving nutritious meals without bureaucracy is to allocate a portion of basic income for food.
2. In families, young adults and other family members will be reluctant to surrender a portion of their cash stipend to the family shopper. Either the family shopper will end up spending more of their own money for food, or large families will lose their efficiency as everyone does their own shopping. Accounting of who spends what is more difficult. A food distribution will solve many conflicts.
3. As citizens of Earth, we have a right to know that other citizens are not going hungry because they spent their food money on a drug fix, alcohol, or at the casinos. This is a choice people can make with the fruits of their own labor, not the bounty of the Earth. We have a right not to have mothers with children, or anyone for that matter, begging on the street for food.
4. The housing distribution allows mortgage lenders to make secure loans at low interest rates for families whose total housing distribution is more than sufficient to cover the mortgage. Cash qualifications for a mortgage would be much tighter.
5. The housing distribution will encourage the development of efficiency studios with all utilities for those unemployed choosing to live alone. A fixed tenant rent equal to the $370 per month housing distribution is possible because landlords can rent these out to the unemployed without fear of default. A cash distribution is far more risky and will force the poor into homelessness or substandard housing.
6. This bears repeating for housing: As citizens of Earth, we have a right to know that other citizens are not homeless because they spent their housing money on a drug fix, alcohol, or at the casinos. This is a choice people can make with the fruits of their own labor, not the bounty of the Earth. We have a right not to have the homeless on our doorsteps, sleeping on rapid transit, under viaducts, and over vents.
7. The housing distribution can be used for vans, RV’s and houseboats, including fuel. For families without children, the housing distribution could be used for a treehouse in the woods or a cave in the mountains. Excess housing distribution can be used for utilities and renovations. In the deep woods, it can be used for sleeping bags, lanterns and an ax.
8. Cash is valid for the payment of all debts public and private. A single business mistake could leave a family hungry and homeless until bankruptcy is declared. It is illegal to demand food or housing distributions as repayment for a debt. Credit for food or housing cannot be extended in promise for future distributions. Distributions can only be transferred within the sovereignty, or used at point of sale for their designated purpose. No matter what happens, there will always be food and shelter.
9. The medical distribution is used to purchase a basic insurance policy. If this is an implied portion of an unallocated basic income, many citizens would opt not to buy the policy. Equity demands that they be refused service in the ER without adequate cash or credit. Even with the cash for emergency treatment and diagnosis, if they lack the cash or credit, surgery can be withheld. If they are confined to a penitentiary, without cash, they can receive no medical treatment without having purchased the basic policy. This is an affront to civilized humanity.
10. Recently, there was news of a house burning down as the fire department watched. The family had not paid for fire protection. As with personal distributions, if police, fire, and defense distributions were paid from a cash stipend, chaos would reign. Moving into an AFFEERCE police or fire district, increases funding by one distribution and moving out, decreases it. This fosters good police-fire-community relations; each person is a valuable asset to their community. Hiding these distributions in a cash stipend does no such thing.
11. Education is the essence of culture, an open-minded liberal society, and a technological world. If you handed everyone a wad of cash and told them to get educated or party, most would party. Allocating money for childhood education does not guarantee that unallocated money will be spent on universities and trade schools. Most people would still forego an education. Yet, these are the places where people need to go to learn to program and operate the complex machinery of the future. Furthermore, education is the most complex distribution because it is not distributed equally, even with equality of opportunity. One cash sum would either be prohibitively large or cheat some students out of their complete education.
In the next installment we look at intellectual property, financing local infrastructure over and above the distributions, and monetary policy.
This article is a part of an ongoing series explaining the AFFEERCE Georgism implementation based on the ideas of economist Henry George. The fruits of our labor belong to us alone while the land belongs to each of us and to all of us. AFFEERCE is an acronym for Alternative Families + Free Enterprise + Universal Entitlement + Balance of the RCs + Enlightenment. To further understand, check out AFFEERCE Volume I – The Vision at AFFEERCE.org. For more info on AFFEERCE natural rights, See AFFEERCE – Volume I – Chapter 8 – The Natural Rights of Mankind. For an introduction to AFFEERCE, See AFFEERCE Volume I – Introduction and AFFEERCE Volume I – Chapter 1 – What is AFFEERCE? See also the stand alone PDF “What is AFFEERCE”a 12 page introduction. All of these are available free on the AFFEERCE website http://AFFEERCE.org.
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