Proposal for a national citizen’s wealth fund in America

IS THE IDEA OF A “CITIZEN’S WEALTH FUND UNAMERICAN? (see below)

Here is a central irony of the grand success of America (and we are just that, no matter how depressive current attitudes might be): how is it that in the largest, richest single nation state in world history, some people have next to nothing or nothing at all? How is it possible that people go "ill fed and ill housed" in the midst of such abundance and success? Step back from the question a bit. What is it that "we the people" own as our birthright, beyond life itself? The air, the water, the natural resources (minerals, fossils fuels) and abundance of the land (fertility) are good starters. (Common human property.) Then, there is the infrastructure (airports, highways, railroads built from collective funds), yes, we own these things, too, because, even in small ways, we all pay for them, even if it is with regressive sales taxes. We own these things, yet only a minority quick enough, clever enough, or endowed with legal support to define and defend their activities, get to profit from the things we all own.

One way to address the issue of poverty in America would be for the national govt. to create a sovereign wealth fund to buy 10% of all major corporations in America and have that ownership assigned to every citizen. Americans could get dividends from all corporate profits. Individuals could cash out at any time and take a portion according to their age. We would all share in what we all own and build and we would all, to some degree, be rich.

Who could object? Would all the people in the nation owning a share of capitalism then be socialism? No. Another aspect of the people’s sovereign wealth fund would be to assign a portion of the royalties from mineral and oil extraction to the people themselves, instead of to the government. America original people’s, the Indians, have had such a fund (with mixed success) for decades where the money from oil and other leases is supposed to be set aside for their benefit. This was supposed to compensate them for the taking of their lands or for drilling/mining on lands they own by treaty.

The state of Alaska has such a fund to collect and distribute money from oil being pumped out of the ground. It is called The Alaska Permanent Fund Corporation and it took in 4.4 billion dollars last year, making it the highest revenue corporation in the state. No one is marching in the streets under the tea party banner insisting that this fund be shutdown.

The earth itself and the resources therein are a common human inheritance. Why should the benefits be limited to government and those who manage to exploit those resources? (Note: in most countries around the world, the governments assert complete ownership of fossil fuels and minerals taken from the ground.) If we are rich in resources, the benefits should be shared by the entire population (even if it is only a few dollars per year) and not assigned by “the right of capture” as it is now. One can only imagine how much money has flowed to those who exploit America’s resources without significant, direct benefit to American citizens. (There are many indirect benefits, of course, like low cost gasoline, which still exists in comparison to Europe, where taxes on the sale boost the price to the equivalent of six to ten dollars a gallon. Norway uses its high taxes on gasoline, pushing the price to nearly ten dollars per gallon, to subsidize college education. )

No one has tested these concepts on a wider basis because the government has generally acted for its own benefit (taxes, fees, etc.), while America’s huge corporations have done the same. If everyone acts for their own benefit and the laws are bent to create greater advantages for those who have wealth, how can ordinary, wage earning citizens progress? At the bottom of the economic pile are the poor and the near poor who start out life with next to nothing and often end up the same way. In any society, some people are bound to win and some lose (in  fact, how can you have winners if you don’t have losers?).

While most people might not feel they have personal wealth to share, we are a very rich, successful nation and we pay a lot, right now, for “anti-poverty programs” that work to some degree, but fail to change the most basic fact for the poor:  after getting benefits, in whatever form, they are still poor. This would not involve a tax on citizens but an assignment of ownership, by purchase, to the wealth fund.

Suppose all American citizens got 40 or 50 thousand dollars at age 26 or 27. Would some people waste it all quickly? Of course. Would some people use it to pay off college loans? Yes. Some would go buy a new car and be broke the next day. Others would start  businesses, get additional job training, help an aging parent or even just take a year off (as they do routinely in England and elsewhere; its called “the gap year”) to enjoy traveling and being alive. What’s so bad about that? We don’t own any of the wealth of America in our own names because we haven’t assigned ourselves any. Those who got there first made sure that almost all of the benefits would go to them and their heirs.

Corporate America might fear such a fund, because people would then no longer be so obligated to their jobs. The problem we have now, however, is there aren’t enough jobs that pay well. For whatever reason, corporate America can’t, or won’t, provide enough jobs for full employment. A fund of this nature could jump start America and help us return to the time when almost every American shared in the increasing wealth of the nation.

Doug Terry (originally a shorter comment for the NY Times online. 2014)