Peter Barnes, an old colleague of mine who writes about the commons from an economic perspective, recently published an essay about “common wealth trusts” as a structure to be used in transitioning to a new economy. The essay, on the Great Transition Initiative website, recapitulates and extends an idea that Barnes has written about in the past – how to use stakeholder trusts to manage common assets (minerals, forests, electromagnetic spectrum, groundwater, etc.) while providing dividends to all citizens who are also co-owners of those assets.
Barnes argues that common wealth trusts “address the two greatest flaws in contemporary capitalism—its relentless destruction of nature and widening of inequality—while still keeping the benefits that markets provide.” Trusts can work because they can provide clear (collective) property rights and formal management systems around resources that are invisible to markets and in many instances threatened with privatization. He writes:
…..Markets currently do not acknowledge such wealth or recognize its value, much less its common ownership. Because of this enormous market failure, private businesses take, use, or pollute common wealth without limit, generally without paying its rightful owners for the privilege. By so doing, private businesses and their narrow group of owners capture much of the value added by common wealth, exacerbating inequality. If businesses had to pay for the use of common wealth, these things would not happen, or at least would happen much less. What are now unpriced externalities or straight-out thefts would become costs for businesses that could generate income for everyone.
“Organizing common wealth so that markets respect its co-inheritors and co-beneficiaries requires the creation of common wealth trusts, legally accountable to future generations,” Barnes argues. “These trusts would have authority to limit usage of threatened ecosystems, charge for the use of public resources, and pay per capita dividends. Designing and creating a suite of such trusts would counterbalance profit-seeking activity, slow the destruction of nature, and reduce inequality.”
One of the satisfying features of the Great Transition Initiative’s essay series is the curated commentary on featured essays. In this case, nine commenters offer short but focused responses to Barnes’ proposals.
Development specialist James Quilligan worries about the need to scale common wealth trusts by federating them through innovations such as “bioregional councils, guilds, entrepreneurial hubs, and strategic planning agencies.”
Geographer Neera Singh is concerned about the inequalities that result by declaring that an ecosystem resource belongs to everyone because such “equality” may ignore past inequities in investment in a resource: “Investment of caring labor by people living in these landscapes cannot be ignored. To treat these natural resources as “common wealth” belonging to “everyone” equally will be to introduce another layer of injustice over past injustices. It is critical to address issues of redistribution. In the absence of radical redistribution of the “common wealth” generated by the past appropriation of the gifts of nature and of indigenous people, peasants, and pastoralists, starting with treating ‘natural resources’ as common wealth, today, will not be enough.”
Economist Elizabeth Stanton worries that politics will interfere with the establishment of a system of common wealth trusts: “As tempting as it is to try to write our political system out of the equation, we will likely need to continue to wade through the morass of political mechanisms that shape our decision-making processes.
Barnes offers direct responses to his friendly critics, which helps illuminate the possibilities and limits of common wealth trusts. One virtue of his idea is that it is immediately actionable within contemporary political settings. The legal models are straight-forward; just add political advocacy. Yet some critics regard the ready-to-go character of common wealth trusts as precisely its shortcoming: it does not change the fundamental dynamics of markets or politics (although Barnes would note that commons trusts can help establish strict new limits on market exploitation of resources and prevent privatization of resources).
An ongoing, timely debate that is worth continuing....