Jay Hammond, the Republican governor of Alaska from 1974 to 1982, was an independent thinker who conceived of, and then persuaded Alaska’s legislators to adopt, the world’s first system for paying equal dividends to everyone. In Hammond’s model, the money comes not from taxes but from a common resource: North Slope oil. Using proceeds from that gift of nature, the Alaska Permanent Fund has paid equal yearly dividends to every resident, including children, ranging from about $1,000 to over $3,000. (Bear in mind that a family of four collects four same-sized dividends.) While this isn’t enough to live on, it nicely supplements Alaskans’ other earnings.

Common wealth dividends could be the next step in America’s long march toward equal rights—and the game-changer that leads to a new version of capitalism. But first, we have to see the opportunity and demand it.

stagnation.

means-tested

dividends

This value isn’t created by single individuals or corporations; it’s created collectively and hence belongs equally to all. In a fairer economy some of it would actually be distributed to all.

The harder part is collecting the revenue. In my latest book, With Liberty and Dividends For All, I show how, over time, we could generate enough revenue to pay dividends of up to $5,000 per person per year.

Tax cuts for the rich have benefited no one but the rich, and as Mark Blyth and Eric Lonergan recently wrote in Foreign Affairs, pumping trillions of dollars into banks hasn’t stimulated our economy either. What’s needed is a system that continually refreshes consumer demand from the middle out—something like periodic dividends to everyone that can be spent immediately.

Imagine if we charged companies for using another common resource—our air—and distributed the revenue equally to all. If we did this, two things would follow. First, higher air pollution costs would lead to less fossil fuel burning and more investment in renewables. And second, households that used less dirty energy would gain (their dividends would exceed their higher costs) while households that used a lot of dirty energy would pay.

One is that America’s middle class is in steady decline. In the heyday of our middle class, jobs at IBM and General Motors were often jobs for life. Employers offered decent wages, health insurance, paid vacations and defined pensions. Nowadays, such jobs are rare.