Ours. Peter Barnes

a “national fund” to pay every man and woman about $18,000 (in today’s dollars) at age twenty-one, and $12,000 a year after age fifty-five. In effect, nature’s gifts would be transformed into grants and annuities that would give every young person a start in life and every older person a dignified retirement. Revenue would come from “ground rent” paid by private landowners upon their deaths. Paine used contemporary French and English data to show that a ten percent inheritance tax – his mechanism for collecting ground rent – could fully pay for the universal grants and annuities.

      An important nuance here is that the rent would be collected not only on a deceased person’s land, but on his entire estate. It would thereby recoup many of society’s gifts as well as nature’s. And in Paine’s view, there was nothing wrong with this. “Separate an individual from society, and give him an island or a continent to possess, and he cannot … be rich. All accumulation therefore of personal property, beyond what a man’s own hands produce, is derived to him by living in society; and he owes, on every principle of justice, of gratitude, and of civilization, a part of that accumulation back again to society from whence the whole came.”

      What Paine invented here, in my retrospective opinion, was a prescient stroke of genius. Long before Wall Street sliced collateralized debt obligations into risk-based tranches, Paine designed a simple way to monetize co-inherited wealth for the equal benefit of everyone. It is a model as relevant – and revolutionary – today as it was then.

Notes

      1 1. Herbert Simon gave two estimates of the share of present US wealth that is attributable to co-inherited social capital: 80 and 90 percent. In “UBI and the Flat Tax,” Boston Review, October 1, 2000, http://bostonreview.net/forum/basic-income-all/herbert-simon-ubi-and-flat-tax, he estimated it was 90 percent. In his last public lecture, he dropped it to 80 percent, the figure I have quoted. https://inst.eecs.berkeley.edu/~cs195/fa14/assets/pdfs/simon_last_lecture.pdf.

      2 2. William Easterly and Ross Levine, “Tropics, Germs, and Crops: How Endowments Influence Economic Development,” Journal of Monetary Economics, 50 (1), (January 2003), http://www.nyudri.org/research-index/2003/tropics.

      3 3. Robert Costanza et al., “The Value of the World’s Ecosystem Services and Natural Capital” (1997), Nature, 387, May 15, 1997, London: 253 ff., https://www.researchgate.net/publication/229086194_The_Value_of_the_World’s_Ecosystem_Services_and_Natural_Capital.

      4 4. The most recent “cap and dividend” legislation was introduced in June 2019 by Senator Chris van Hollen (D-Maryland) and Rep. Don Beyer (D-Virginia), https://www.vanhollen.senate.gov/imo/media/doc/Healthy%20Climate%20and%20Family%20Security%20Act.pdf.

      5 5. As Guy Shrubsole recounts in Who Owns England?, thirty entities – families, corporations, duchies, and individuals – own half the land of England. This goes back to the eleventh century, when William the Conqueror replaced the existing aristocrats with his own. Their heirs, in turn, have ruled the English countryside ever since. As the sixth Duke of Westminster once put it, the best way to succeed in Britain is to “have an ancestor who was a very close friend of William the Conqueror.”

      6 6. Thomas Paine, Agrarian Justice (1796), is available in many editions, collections and web sites, including the US Social Security Administration’s website, https://www.ssa.gov/history/paine4.html.