Jan 6, 2017

The universal right to capital income: We need a big money tree

The Universal Right to Capital Income by Yanis Varoufakis, a former finance minister of Greece, is Professor of Economics at the University of Athens.

There is no question that citizens need a big money tree, where the money fruit is shared equally by all citizens, in the form of a citizen dividend. Some prefer to call this a universal basic income.

The main question is where the money is coming from to grow the big money tree.
"The idea that you work hard and pay your income taxes, while I live off your enforced kindness, doing nothing by choice, is untenable. If a universal basic income is to be legitimate, it cannot be financed by taxing Jill to pay Jack. That is why it should be funded not from taxation, but from returns on capital."
Yanis wants a portion of all IPO shares to be deposited centrally and the future dividends from such shares will be paid as citizen dividends.

There are many good comments there:
  • Funding via money printing is good.
  • A corporate income tax by any other name.
  • If you really think that taking a percentage of each IPO will adequate to fund this fund of yours, you are off your rocker. the volume of IPOs today is not nearly large enough.
  • Hit the shared natural resources that are the birthright of all of us, not the benefit of individual labor or enterprise. 
  • If Vaaroufakis wants a more equal capital income distribution he should look at property and natural resources.
It is not good to tax someone else's employment income to finance a citizen dividend. This is "taxing Jill to pay Jack."

It is not good to tax someone else's capital income to finance a citizen dividend. This is also "taxing Jill to pay Jack."

It is absolutely right for a country to return the citizens' common property to citizens in the form of a citizen dividend. This means every citizen is getting his own money back. This is NOT "taxing Jill to pay Jack." It is returning each citizen's ownership money, individually and unconditionally.

Almost every politician thinks that just because he wins an election, he has the mandate to spend the citizens' common property in any way he wants. This is totally absurd. Imagine you appoint an agent to manage your property, and the agent thinks he can do whatever he wants with your property.

Macau. Land of citizen dividends. 2017 Wealth Partaking.

The Government of Macau has announced that,
"In 2017 the government will once again offer the Wealth Partaking Scheme to permanent residents at Pte9,000 and to non-permanent residents at Pte5,400." (Pte9,000 = US$1,126)
This unconditional universal payment is on top of a long list of welfare benefits.

Macau has been distributing wealth to residents for many years.

The Permanent Fund Defenders

The Permanent Fund Defenders, out to protect the Alaska Permanent Fund Dividend.

"I think if people understand that the permanent fund world example is under attack in Alaska, they will stand up for it,” Halford said. “But they have to understand it, and it’s our job to help them understand it.”
The Permanent Fund Defenders have posted educational videos about the permanent fund to YouTube and created a Facebook page, with a website coming later this month. Juanita Cassellius, the organizer of the group, said the plan is to operate on donations and to mostly utilize social media for outreach.
Hope they can stop the rogue politicians who snatch thousands of dollars from every Alaskan annually, including babies. This is the dividend money that each and every Alaskan owns as a citizen owner of Alaska.

The UBI will therefore lead to an increase in taxes. Wrong!

Universal Basic Income is not a complete give-away. (Jan 6, 2017). The writer, Chris Kuan, jumps to the usual conclusion that a universal basic income will lead to an increase in taxes. It may be true for some countries. Since the article is about Singapore, the conclusion is definitely wrong. Singapore has a vast amount of resources (government held funds and huge recurring land sales, among others) which are not used in the government's operating expenditure. 

The investment returns and recurring government sales of land and car certificates are more than enough to sustain a big universal basic income year for year for eternity. Singapore can easily have a sustainable universal basic income of $10,000 without having to increase any taxes.

See the following posts for some calculations:

Singapore revenue and expenditure for 2013 IF we have a citizen dividend / unconditional basic income

Singapore is a resource-rich country!!!

Dec 25, 2016

A Short Christmas Story: The Compassionate Painting of Jesus

As Christmas approaches, the Priest browses through the paintings collected by his predecessors.

He comes across an old painting of Jesus. He is overwhelmed by the compassionate expression of Jesus.

On the first day of Christmas, he auctions off the painting and donates the money (a million dollars) to charities.

The new owner, Jack, is similarly overwhelmed by the painting of Jesus.

On the second day of Christmas, Jack auctions off the painting and donates the money (two million dollars) to charities.

The third owner, Tom, is powerfully overwhelmed by the painting of Jesus.

On the third day of Christmas, Tom auctions off the painting and donates the money (four million dollars) to charities.

This repeats day after day for twelve days of Christmas, with the money doubling each day.

At the end of twelve days, billions of dollars reach charities around the world, all because of one powerful painting.

(This story is triggered by Pope Francis' speech at the Christmas Eve Mass)

Nov 2, 2016

It is your duty to plant a money tree. For yourself. For your future generations.

It is your duty to plant a money tree, for yourself and for your future generations.

The rich do this. Bill Gates does it. Even though he plans to give his £70 billion fortune to charity, his kids will get enough so that 'they are never going to be poorly off.'

You say, yes, I know, but where do I find the resources to plant a money tree?

You have a vote, right? You own your country, right?
You have the resource and the power. Use them.

First, you plant the money tree, with the help of your politicians. There is a great example to follow. The "Governor who gives dividends" planted a big money tree in Alaska in the 1970s. For many decades, Alaskans have been receiving money from this big money tree. Every year, millions and billions of dollars drop into the pockets of Alaskans.

Then, you need to nurture and protect the money tree. Or else, some rogue politician will hack the tree down. Alaska is again a great example. If Alaskans don't protect their money tree, it will be gone very soon.

Why a citizen dividend?

Why must countries provide a citizen dividend?

The case is very well presented by the Goenchi Mati Movement. Please read their post on this.

'Our core principle is that minerals are inherited assets and a part of the commons. Hence either the minerals or their financial equivalent in other “non-wasting” assets must be available to future generations. Conceptually, replacing minerals with a Permanent Fund converts our mineral inheritance corpus into an asset that generates income perpetually, a perpetual annuity or a perpetuity. Since minerals are a part of the commons, the Permanent Fund continues to be part of the commons, and by extension, the real income is distributed as a commons dividend, equally to all as a right of ownership. Provided we maintain the real value of the Permanent Fund, this can happen in perpetuity.'

And their video on citizen dividend:

Sep 5, 2016

God save the Queen, and the Alaska Dividend

"The Permanent Fund belongs to all Alaskans. The Permanent Fund dividend belongs to each individual Alaskan and it should be used by each individual as he or she determines best. It should not be used to pay for government. Once we start raiding the fund and the dividend, we most likely will never get them back. It could easily become a slippery slope leading to the ultimate demise of the fund and the dividend."
"Some think the dividend is a needless giveaway. But I believe that our natural resources, such as oil, gas, minerals, trees, marine life, etc., were put on this Earth by God to benefit all the people so that mankind would have a way to sustain itself. Therefore, I believe that every individual who walks on this Earth has a right to a reasonable share of these commonly owned resources, either directly or through some equivalent. The world's commons should not belong to individuals or to private corporations. They did not put the oil in the earth or the diamonds in the ground; therefore, the commons should not be theirs. Yes, individuals and corporations should make a fair profit or earnings from developing these resources, but since the resources belong to all the people in common, everyone should benefit."
(From: Fiscal plan must strengthen both Permanent Fund and dividend. Author: Dr. Jack Hickel. August 23)
The Alaska Governor had vetoed the payment of the Alaska Dividend, putting a limit of $1000 for the dividend. Left to grow freely, the Alaska Dividend is expected to reach $2000 per Alaskan this year, and will continue growing and growing, forever, as in a real life fairy tale.

Will God save the Alaska Dividend?
Will someone save the Alaska Dividend?

There is some hope: Walker faces possible legal opposition for PFD cuts. By Andrew Kitchenman, APRN & KTOO - Juneau - August 11, 2016

Will some judges in Alaska have the final say?
Will Alaskans have the final vote?

Jul 30, 2016

How to share the profit of capitalism?

With big income inequality and the real threat of job loss, it is more and more pressing to explore how to share the profit of capitalism. For example, when robots drive our vehicles, who is going to share the profit from the robot companies?

Here is a list of how profit of capitalism has been shared:
  1. No sharing. The capitalists exploit as much as possible and keep the profit. 
  2. Total takeover. The capitalists are exiled. The state takes over. The state takes the profit. 
  3. Small scale sharing where some employees are given shares. 
  4. Government redistribution through income/wealth tax, and giving some, only some, of the tax to the poor. 
  5. Big scale government sharing of the profit for the government itself. The government sets up big sovereign wealth fund to invest, reaps profit and keeps the profit for itself. The profit of capitalism is shared between the capitalists and the government. 
  6. Big scale corruption. The politicians get oiled by the capitalists. Profit is shared between politicians and capitalists. 
  7. The government sets up big sovereign wealth fund to invest, reaps profit and keeps the profit for itself. At the same time, the politicians manage the sovereign wealth fund and pay themselves handsomely. The profit of capitalism is shared between the capitalists, the politicians and the government. 
  8. Big scale sharing of the profit with everybody. The government, as an agent of the citizens, invests huge money, reaps big profit, AND returns the profit to every citizen equally. 
In all these approaches except the last, the normal average citizen gets nothing.

In most of the current debate about poverty and inequality, people focus on point 4 --- how to tax the rich. While important, this is not enough and has very limited effect.

The last approach is the best. It makes everyone a capitalist. There is no limit on how much everyone can get. Carefully managed over the long term, it will not be impossible that everyone makes a annual profit of $20,000 or more from the sovereign wealth fund.

UK has good democracy

Recent events show the great side of UK's democracy.

1. The people have the power, as shown in the Brexit referendum. Whatever the outcome, the people decide. The decision is not hatched in a dark Cabinet.

2. There is a neutral process to carefully scrutinize recent leaders' actions, as in the Chilcot report.

The democratically elected leaders are bound by the people's referendum, and are answerable for their actions.