"Misers make wonderful ancestors."
The philosopher, Lord Bertrand Russell, who lived almost to 98, answered, “What’s the difference between ignorance and apathy?” with “I don’t know and I don’t care.” Without ever spending a day in school, the lord scored the highest ever on history in the entrance exam to Cambridge University. He co-authored Principia Mathematica, which in 900 pages gave math its logical underpinnings. Russell also proposed that society share natural rent. Is that what we should do with that immense ocean which is the worth of Earth in America?
Just take a peek at the hefty flows of rent to see how bountiful the economy is (Ch 37). The grand total for how much we spend on the nature we use challenges our current assumption of scarcity. No longer is the economic challenge we face production but now it’s distribution.
So how should we distribute this torrent of socially generated values? There are four different ways to divvy up that pie. Should we:
Handing over to government is not popular. Shrinking it spawns black markets. Doing nothing means we’re OK with the annual value of locations, natural resources, and of government-granted privileges—half of GDP—propping up society as is.
Were we to choose to turn the value of locations and natural resources into a tax base or a source of funding for something like a Social Security for everyone, then nearly everyone would take an interest in measuring the size of society’s surplus. Conversely, were government or academia to calculate the worth of Earth in America, that figure would likely intrigue people with the question of what to do with so much bounty. No matter what we choose, once we know its size then we know the health of our economy and when to anticipate the ups and downs of the business cycle.
Just as many of us feel emotionally predisposed to reject paying a tax on land, so do many of us feel the same way toward receiving a share of rent. Even though it’d mean fresh money in our own shallow pockets, many of us oppose getting something for nothing … in general. But not absolutely.
While some object to government spending on the poor, they do not object to politicians providing corporate welfare to the rich. And it’s doubtful critics would repeal the freebies they get: Social Security COLA, Medicare, public schools funded in part by childless homeowners, etc. So a freebie is good for the goose, not the gander.
Further, objectors claim many recipients would waste their share, even though they do not object to current rentiers wasting more than their share on a profligate lifestyle. Yet most welfare recipients don’t; those poor who receive cash, no strings attached, actually spend the money in socially-approved ways. As many poor say, they want a hand up, not a hand out.
Critics fear many recipients would quit working, despite the fact many can’t keep working because their jobs are disappearing. Good riddance in many cases since a huge number of jobs are not productive but merely conformist; the work does not actually produce food, clothing, shelter, energy, transportation, medicine, or recreation. Indeed, most work is a waste of life.
If objectors were to look into right and wrong more deeply …
Most of us believe that owning land means owning its value. We feel no moral imperative of owing its annual value to our neighbors. Yet by occupying land, one does displace all others. Is that fair? Not according to some sage voices.
Most moral traditions make statements like the one in the Bible: “The fruits of Earth belong to everyone.”—God, BC. The phrase “commonwealth” used to be commonplace. Why?
First, nobody made Earth so our spending for land and resources never rewards anybody’s labor or capital, None of us can buy land from its maker. You buy goods and services from their producers and providers, but not land and other natural resources. That’s why spending is of two types, rewarding either effort or status.
Second, enjoying an equal right to life, and needing land in order to live, we all enjoy an equal right to land. Yet when we claim or occupy a location, we displace everyone else. Hence, we owe them compensation, just as everyone else owes us compensation for displacing us.
Third, while nobody made land, everybody makes its locations valuable. It’s not owners but the presence of society that generates land value. It’s not old-timers selling out and moving on but newcomers buying up and settling in. The most powerful and accurate generator of land value is population density, something no owner by himself can claim responsibility for. Thus our popular interpretation of property is one huge misunderstanding.
This stream of spending is a surplus and potentially a commonwealth. What happens to a surplus? It triggers the paying of dividends to the deserving. Since society conjures rent, sharing it completes the cycle—incipients of rent would become recipients of rent.
Were modern humans persuaded that sharing the gains from land is just, they’d not be first—far from it. For millennia sharing was customary. Gatherer/hunters shared their pickings and game. In the Pacific Northwest, native Indians had so much wealth (even if primitive) that people lost their material insecurity. One did not show off and gain status by hoarding stuff but by giving it away. Their potlatches still exist today.
At the beginning of Agrarian age, the whole harvest went into the community granary and back out in equitable shares. Later the king was supposed to disburse this output equitably. Of course, royalty got away from that duty, and just kept the inputs. One exception was early in the Industrial Revolution when England paid people enough to buy bread.
People are basically generous. In the past, workers via their unions did their best to take care of the poor. Presently people still are generous, donating to churches and charities.
Even those who weren’t too generous on their way up became charitable once arrived at the top. It’s in our genes.
"With power comes responsibility" —French National Convention during their revolution in 1793
Lately some big names who’ve made it big materially propose paying an extra income to everyone—a “Basic Income” (enough so people could at least scrape by)— whether they have a job or not, whether they're wealthy or not.
Those luminaries are the latest to advocate an extra income. The idea rears its head every generation:
Everywhere it’s entrepreneurs.
Also climbing aboard this bandwagon are:
Organizations of various perspectives endorse the idea:
Stockton California plans to test a basic income. At Cash Conference in San Francisco, the town’s mayor, Michael Tubbs, said the program isn't a response to encroaching technology. “Basic income isn't about a scary future where robots run everything. It’s about today, when working people can't afford rent.” Note that word, “rent”.
Canada, Finland, and Kenya have already started paying randomly selected citizens. Finland has inspired Scotland to follow suit. Kenyans invested theirs in home repairs and schooling their kids, plus domestic violence has fallen.
As for funding BI, proponents have yet to consense around its source. None of those proponents appeared cognizant of social surplus. If the source of extra income is anything but surplus, then when recipients spend it, they’d inflate prices. Landlords in particular would just raise their charge. Note how:
Yet an extra income for all need not inflate prices. That just depends on its source.
Rather than Basic Income, the extra income could be a share of surplus. How’d that work? All of us who are owners would pay amounts commensurate with the value of the locations we claim and all of us who are residents in the region would get back amounts equal to how much everybody else gets. Land dues in, rent shares out.
Using fees or dues or taxes, government would redirect society’s spending for land, natural resources, the electromagnetic spectrum, ecosystem services, and the rest of the planet that we find useful enough to be willing to pay to use, etc, temporarily into the public treasury then back out. Call it a Citizens Dividend.
The policy of disbursing some of the worth of Earth does have a pedigree, endorsements from some world-class, open-minded thinkers:
How big a dividend might a citizen receive? Initially, due to politics and normal people’s resistance to change, it might not be that much—maybe $100 per month. To win even that much, recall that the biggest household budget expense is land beneath housing (Ch 20). A politically palatable first step may be to replace the property tax with a land-use fee and use that revenue only for a resident’s dividend, a la Aspen.
Eventually society would tap all rent streams. The per capita amount comes to $10,000 per month (Ch 37). Even if that calculation is off by a factor of 10, wouldn’t it be nice to get $1,000 each month?
When the economy cranks, swelling land values and rent shares, one can work less. When the economy coasts, shriveling land values and rent shares, one can work more. In both phases, one will have enough, thereby solving the classic economic problem—suffering from poverty.
This article is Part 40 of a series highlighting the forthcoming book, “Bounty Hunter: a gadfly’s quest to know the worth of Earth,” by Jeffery J. Smith. To date, the experts have not risen to meet the challenge. Indeed, some have even stood in the way. Yet the payoff for knowing this datum is huge.
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JEFFERY J. SMITH published The Geonomist, which won a California GreenLight Award, has appeared in both the popular press (e.g.,TruthOut) and academic journals (e.g., USC's “Planning and Markets”), been interviewed on radio and TV, lobbied officials, testified before the Russian Duma, conducted research (e.g., for Portland's mass transit agency), and recruited activists and academics to Progress.org. A member of the International Society for Ecological Economics and of Mensa, he lives in Mexico. Jeffery formerly was Chief Editor at Progress.org.