Imagine a world in which all major private wealth (every factory, patent or plot of land) is constantly for sale at a fair price and where most of the value of this property is paid out equally to all citizens as a social dividend. While one might be tempted to believe the wealthy would dominate such a hyper-market world, in fact most private wealth would become social wealth and would be shared equally by all. With most value of assets accruing to the public, every asset would become cheaper to (partially) own, democratizing the control of assets and offering everyone new opportunities to start businesses or households. At the same time, because there would be a price on every asset, large scale projects, like high speed trains, would become far easier to develop as holdouts could no longer block the right of way.
We propose a new property system, called the Common Ownership Self-Assessed Tax (COST), that would make such a world come true. Every citizen and especially corporation would self-assess the value of assets they possess, pay a roughly 7% tax on these values and be required to sell the assets to anyone willing to purchase them at this self-assessed price. This tax would raise enough revenue to eliminate other taxes on capital (such as on inheritance, corporations, capital gains, property and so forth), significantly reduce income taxes and pay down much of public debt, while at the same time funding a large social dividend (of roughly $24,000 for a family of four in the United States) or funding critical public infrastructure. At the same time, unlike most taxes, it would actually grow the economy by 5%. Beyond these economic benefits, a COST would create a healthier relationship to property, teaching us to detach from our material possessions and stop trying to exploit one another in commercial transactions, instead seeking to increase the value of common wealth and strengthening the bonds of community. And while such a dramatic change may seem like a speculative pipedream, it is a natural way, even in the near-term, to govern public resources like the radio spectrum.
To learn more, read Chapter 1 of our book here.