Citizen's dividend is a proposed policy based upon the Georgist principle that the natural world is the common property of all people. It is proposed that all citizens receive regular payments (dividends) from revenue raised by leasing or taxing the monopoly of valuable land and other natural resources.
A concept akin to a citizen's dividend was known in Classical Athens. In 483 BC, a massive new seam of silver was found in the Athenian silver mines at Laurium. [1] The dispersal of this provoked great debate. The statesman Aristides proposed the profit from this should be distributed among the Athenian citizens. [2] However he was opposed by Themistocles, who proposed the money be spent building warships for the Athenian navy. In the end, Themistocles' policy was the one adopted. [2]
In the United Kingdom and United States, the idea can be traced back to Thomas Paine's essay, Agrarian Justice , [3] which is also considered one of the earliest proposals for a social security system. Thomas Paine summarized his view by stating that "Men did not make the earth. It is the value of the improvements only, and not the earth itself, that is individual property. Every proprietor owes to the community a ground rent for the land which he holds." Paine saw inheritance as being partly a common fund and wanted to supplement the citizen's dividend in a tax on inheritance transfers, but Georgist supporters now focus on natural resources.
This concept is a form of universal basic income (UBI), where the citizen's dividend depends upon the value of natural resources or what could be titled as common goods like location values, seignorage, the electromagnetic spectrum, the industrial use of air (CO2 production), etc. [4]
The U.S. state of Alaska dispenses a form of citizen's dividend in its Permanent Fund dividend, which holds investments initially seeded by the state's revenue from mineral resources, particularly petroleum. In 2005, every eligible Alaskan resident (including children) received a check for $845.76. Over the 24-year history of the fund, it has paid out a total of $24,775.45 to every resident. [5] Some believe this dividend as the reason why Alaska has one of the lowest rates of inequality and relatively low levels of poverty compared to other US states. [6] [ dubious – discuss ] A 2018 paper found that the Alaska Permanent Fund "dividend had no effect on employment, and increased part-time work by 1.8 percentage points (17 percent)... our results suggest that a universal and permanent cash transfer does not significantly decrease aggregate employment." [7]
The concept is also promoted as a tool to reduce carbon emissions. [8] Peter Barnes created the concept of "Sky Trust" as an example of how this could be implemented. Barnes proposes setting up a public trust to manage the funds, separate from the private sector being taxed. [9] A calculation based on specific assets by Barnes estimates that American citizens could each get $5,000 per year by this model. [6]
A Swiss campaign in 2013 advocated for a citizen's income which could net each citizen an amount equivalent to $34,000. [6] A citizens dividend based on resources according to Thomas Pogge is due to every citizen because everyone owns an inalienable stake in all limited natural resources. [10] His theory goes along with Barnes with the exception of ownership, Pogge contends that the people own the resources. [4] [11] The Progress Report says that the dividend should be valued by the free market. [12]
John Moser, a 2018 congressional candidate in Maryland, ran chiefly on the proposal that a citizen's dividend based around a portion of all income would eliminate homelessness and hunger, and would act as a collective risk share as used in Nordic model nations. [13] [14]
The New Physiocratic League, a project advocating for an economic reform revolving around shifting taxation towards land, advocates for a form of citizen's dividend as part of its Three Pillars program of income support. [15]
Rahul Chimanbhai Mehta, an Indian politician, has proposed a form of citizen's dividend. In his system, two-thirds of the royalty payments from mining and wireless spectrum, as well as the rent collected from some public land would be dispensed as monthly payments to all Indians above the age of seven. [16] The remaining third would be allocated for the military. His proposal allocates less funds for parents who have more than four children and for legal minors but more funds for senior citizens. According to his estimate, this can result in a monthly income of approximately Rs. 1000 for every Indian. [17]
Several philosophers and economists connect left-libertarian ideas with support for UBI. Of these, the most closely related theory to Georgism calls for a citizen's dividend—that is, a UBI equal to the monetary rental value of natural resources and socially created wealth. Writers advocating citizen's dividends include Peter Barnes (author of With Liberty and Dividends for All), economist Nic Tideman and activist Jeff Smith. [18] Barnes proposes setting up a public "Sky Trust" to manage the funds creating from taxing pollution, greenhouse gases and other actions that deplete the value of shared natural resources. [19]
Other theorists use left-libertarian insights without strictly connecting the monetary value of resource value with the level of UBI. Philippe Van Parijs makes a freedom-based argument for the highest sustainable UBI regardless of the value of natural resources, justified partly on the basis that the labor market is imperfectly competitive and produces a significant amount of "job rents." [20] Guy Standing uses many left-libertarian or "[Thomas] Painist" arguments for UBI, [21] [22] along with progressive and social-democratic arguments for UBI without committing to resource- or rent-based financing of UBI. [23] [24]
To reduce economic inequality to levels he considers more advantageous, Steven Pearlstein proposes a $3000 per year dividend for Americans completing K-12 education, with a requirement to at some point perform three years of public service (or, alternatively, profit sharing). [25]
The Alaska Permanent Fund (APF) is a constitutionally established permanent fund managed by a state-owned corporation, the Alaska Permanent Fund Corporation (APFC). It was established in Alaska in 1976 by Article 9, Section 15 of the Alaska State Constitution under Governor Jay Hammond and Attorney General Avrum Gross. From February 1976 until April 1980, the Department of Revenue Treasury Division managed the state's Permanent Fund assets, until, in 1980, the Alaska State Legislature created the APFC.
An environmental tax, ecotax, or green tax is a tax levied on activities which are considered to be harmful to the environment and is intended to promote environmentally friendly activities via economic incentives. One notable example is a carbon tax. Such a policy can complement or avert the need for regulatory approaches. Often, an ecotax policy proposal may attempt to maintain overall tax revenue by proportionately reducing other taxes ; such proposals are known as a green tax shift towards ecological taxation. Ecotaxes address the failure of free markets to consider environmental impacts.
Public property is property that is dedicated to public use. The term may be used either to describe the use to which the property is put, or to describe the character of its ownership. This is in contrast to private property, owned by an individual person or artificial entities that represent the financial interests of persons, such as corporations. State ownership, also called public ownership, government ownership or state property, are property interests that are vested in the state, rather than an individual or communities.
Georgism, also called in modern times Geoism, and known historically as the single tax movement, is an economic ideology holding that people should own the value that they produce themselves, while the economic rent derived from land—including from all natural resources, the commons, and urban locations—should belong equally to all members of society. Developed from the writings of American economist and social reformer Henry George, the Georgist paradigm seeks solutions to social and ecological problems, based on principles of land rights and public finance that attempt to integrate economic efficiency with social justice.
Geolibertarianism is a political and economic ideology that integrates libertarianism with Georgism. It favors a taxation system based on income derived from land and natural resources instead of on labor, coupled with a minimalist model of government, as in libertarianism. The term was coined by the late economist Fred Foldvary in 1981.
Guaranteed minimum income (GMI), also called minimum income, is a social-welfare system that guarantees all citizens or families an income sufficient to live on, provided that certain eligibility conditions are met, typically: citizenship and that the person in question does not already receive a minimum level of income to live on.
Asset-based egalitarianism is a form of egalitarianism which theorizes that equality is possible by a redistribution of resources, usually in the form of a capital grant provided at the age of majority. Names for the implementation of this theory in policy include universal basic capital and stakeholding, and are generally synonymous within the equal opportunity egalitarian framework.
Agrarian Justice is the title of a pamphlet written by Thomas Paine and published in 1797, which proposed that those who possess cultivated land owe the community a ground rent, which justifies an estate tax to fund universal old-age and disability pensions and a fixed sum to be paid to all citizens upon reaching maturity.
Peter Barnes is an American entrepreneur, environmentalist, and journalist.
The social dividend is the return on the natural resources and capital assets owned by society in a socialist economy. The concept notably appears as a key characteristic of market socialism, where it takes the form of a dividend payment to each citizen derived from the property income generated by publicly owned enterprises, representing the individual's share of the capital and natural resources owned by society.
Universal basic income (UBI) is a social welfare proposal in which all citizens of a given population regularly receive a minimum income in the form of an unconditional transfer payment, i.e., without a means test or need to work. In contrast a guaranteed minimum income is paid only to those who do not already receive an income that is enough to live on. A UBI would be received independently of any other income. If the level is sufficient to meet a person's basic needs, it is sometimes called a full basic income; if it is less than that amount, it may be called a partial basic income. As of 2024, no country has implemented a full UBI system, but two countries—Mongolia and Iran—have had a partial UBI in the past. There have been numerous pilot projects, and the idea is discussed in many countries. Some have labelled UBI as utopian due to its historical origin.
The global resources dividend (GRD) is a method of tackling global poverty advanced by the philosopher Thomas Pogge. He presents it as an alternative to the current global economic order. Under the scheme, nations would pay a dividend (tax) on any resources that they use or sell, resulting in a sort of "tax on consumption" Pogge's scheme is motivated by the positive duty to alleviate poverty, but also on the negative responsibility of the rich not to use institutions that perpetuate economic inequality. Pogge estimates that a dividend of just 1% could raise $300 billion each year; this would equal $250 for each individual in the world's poorest quintile.
Economic democracy is a socioeconomic philosophy that proposes to shift ownership and decision-making power from corporate shareholders and corporate managers to a larger group of public stakeholders that includes workers, consumers, suppliers, communities and the broader public. No single definition or approach encompasses economic democracy, but most proponents claim that modern property relations externalize costs, subordinate the general well-being to private profit and deny the polity a democratic voice in economic policy decisions. In addition to these moral concerns, economic democracy makes practical claims, such as that it can compensate for capitalism's inherent effective demand gap.
Universal basic income is a subject of much interest in the United Kingdom. There is a long history of discussion yet it has not been implemented to date. Interest in and support for universal basic income has increased substantially amongst the public and politicians in recent years.
Social ownership is a type of property where an asset is recognized to be in the possession of society as a whole rather than individual members or groups within it. Social ownership of the means of production is the defining characteristic of a libertarian socialist economy, and can take the form of community ownership, state ownership, common ownership, employee ownership, cooperative ownership, and citizen ownership of equity. Within the context of socialist economics it refers particularly to the appropriation of the surplus product, produced by the means of production, or the wealth that comes from it, to society at large or the workers themselves. Traditionally, social ownership implied that capital and factor markets would cease to exist under the assumption that market exchanges within the production process would be made redundant if capital goods were owned and integrated by a single entity or network of entities representing society. However, the articulation of models of market socialism where factor markets are utilized for allocating capital goods between socially owned enterprises broadened the definition to include autonomous entities within a market economy.
Universal basic income (UBI) is discussed in many countries. This article summarizes the national and regional debates, where it takes place, and is a complement to the main article on the subject: universal basic income.
Karl Widerquist is an American political philosopher and economist at Georgetown University on its campus in Qatar. He is best known as an advocate of basic income, but is also an interdisciplinary academic writer who has published in journals in fields as diverse as economics, politics, philosophy, and anthropology. He is a consistent critic of propertarianism, right-libertarianism, social contract theory, and the belief that modern societies fulfill the Lockean proviso.
Universal basic income and negative income tax, which is a related system, has been debated in the United States since the 1960s, and to a smaller extent also before that. During the 1960s and 1970s a number of experiments with negative income tax were conducted in United States and Canada. In the 1970s another and somewhat related welfare system was introduced instead, the Earned Income Tax Credit. The next big development in the history of basic income in the United States came in 1982, when the Alaska Permanent Fund was established. It has delivered some kind of basic income, financed from the state's oil and gas revenues, ever since.