We propose the creation of a “Citizenship Wage,” whereby every adult citizen will receive $8000 per year. This wage will be an entitlement given to every citizen over the age of 18 without conditions or obligation. At the same time, we will eliminate means-tested welfare, making the citizenship wage the backbone of a new social safety net. (This will not affect paid-for retirement or insurance programs, such as Social Security and Social Security Disability Insurance.)
The citizenship wage will ensure that every American is able to provide the basic necessities for their family. It will allow people to take greater risks, becoming entrepreneurs, artists, and inventors, leading to creations that will benefit all of us for years to come. It will provide people who are impoverished, but talented and ambitious, with the support they need to pursue the education and training they require to break out of the cycle of poverty.
Most of all, the citizenship wage is a recognition of the fact that we live in a time of prosperity. That prosperity is the result of the hard work, sacrifice, and ingenuity of generations of Americans. That prosperity is the birthright of all Americans. The citizenship wage ensures that every American partakes of that prosperity, and puts them in the best position to contribute to building an even greater prosperity for the future.
Land of Abundance
We have inherited a country and a culture where only a small fraction of our resources are required to provide at least a minimal standard of living to every American. Our national wealth and productivity have reached the point where, as Buckminster Fuller famously said, “one in ten thousand of us can make a technological breakthrough capable of supporting all the rest.” We can free America from the fear of penury that stifles the creativity of so many. We can return work to its rightful place as ritual that enriches, rather than impoverishes the soul.
In 1976, the State of Alaska established the Alaska Permanent Fund. This fund sets aside a fraction of the state’s oil revenue for the benefit of current and future Alaskan residents. Every year, the fund pays a dividend to every Alaskan resident, generally on the order of $1000. This dividend is a recognition that the natural resources of the state belong to all Alaskans, and that everyone should benefit from them.
All of the United States have been blessed with abundant natural resources, and we believe that the proceeds from those resources should go to the benefit of all Americans. But these are not just natural resources like oil and coal. The vast majority of our nation’s wealth derives from the inventions and ideas generated by generations of Americans over centuries. It comes from systems of fiscal, cultural, and physical infrastructure that were created by millions of hard-working Americans.
The nature of our current economic system means that many of these infrastructure systems are now owned and controlled by a tiny fraction of the population, who benefit disproportionately from the wealth that they create. We do not propose nationalization or socialization of these systems, as an appropriately regulated free market is critical to the efficient allocation of resources. However, by taxing some of this extreme wealth to fund a citizenship wage, we are acknowledging that these systems are in many respects our collective creation and our collective inheritance.
Ending Means Tested Welfare: Correcting the Incentive Structure
One of the problems with the current system of means-tested welfare is that it creates situations where people actually have an incentive not to work. If you are on welfare, and you get a job (or move to a better job), you risk pushing your income above a threshold beyond which you lose your welfare benefits. The goal of any social safety net is to protect people when they are at their most vulnerable, and to provide them with the resources they need to get back on their feet. Unfortunately, the structure of the current means-tested welfare system can have the opposite effect, by encouraging people not to go out and make a better life for themselves.
The citizenship wage is an entitlement owed to every citizen. You will not lose that entitlement because you get a job or a raise. We will move towards a system where hard work and ingenuity are facilitated and rewarded all across the income spectrum.
The End of Poverty
At $8000 dollars per year, the citizenship wage does not aim to create a situation where everyone can live comfortably without working. However, it does set the stage for everyone to lift themselves above the poverty line. For example, a two-adult household, with one person working forty hours a week at the current minimum wage would have a household income of $31,000 per year, which is above the poverty line for a household of up to six members.
Stabilizing Families
In the poorest segments of our society, people often feel the need to work more than one job in order to provide their families with the basic necessities of life. These are hard-working individuals who are committed to building a better life for their children. With the citizenship wage, many of these people will be in a position to work only a single job and spend more time with their families. The people who are willing to work a second job to support their families are exactly the sort of role-model parents who should be actively involved in their children’s lives.
Single parent families have also been increasing in our society, especially among lower income groups. With each additional adult bringing significant income when they join the household, we should expect a significant reduction in single parent families as a result of the adoption of the Citizenship Wage.
Facilitating Risk
Most of the new jobs in this country are created by small businesses, and many of our greatest advancements are the result of individual inventors and entrepreneurs. Today, many would-be entrepreneurs feel unable to take the risk of starting their own business, because of the financial risk to themselves and their families. By creating a financial safety net, the citizenship wage will make it easier for people to start their own businesses or pursue the next great invention.
Invention and entrepreneurship necessarily involve risk. One third of new businesses do not survive to their second year, and more than half do not survive for five years. But the new businesses that do survive are the single most important factor contributing to economic growth and job creation.
Encouraging Creation and Charity
It is not just entrepreneurship that will benefit from the citizenship wage. For many, the time and resources that it frees up might be devoted towards projects that will not lead directly to financial gain, but will still provide benefits to society. Some people might be encouraged to take up new community service projects, like volunteering at a church, shelter, or youth group. Other people might take on creative projects, like writing or painting. Someone might take on a woodworking project, building a new bookcase for their home. Someone else might feel that they now have the time to shovel the driveway for the elderly couple down the street. If we can release some of the fear and anxiety that people feel about making ends meet, they will be more freely able to embrace the American traditions of community service and mutual support.
A Fluid Labor Force
Today’s economy is radically different from the one that dominated America in previous generations. The days when one might work in the same job, or for the same company, for one’s entire life have largely disappeared. Rapidly changing technologies and a dynamic global economy require companies to be able to quickly and efficiently expand AND reduce their workforce, responding to changes in the market and continually updating their collective skill sets. However, under the current system, rapid job reductions exact a significant toll on individual workers, and can lay waste to entire communities. By adding the Citizenship Wage to the already existing Unemployment Insurance program, the United States will be able to maintain fluid staffing rules, which provide a significant competitive advantage, while mitigating the harm to individual workers and their families.
How Do We Pay For It?
The most obvious question you might ask is, “Where is all this money going to come from?” For the current adult population of the United States of 231 million people , $8000 apiece adds up to about $1.71 Trillion per year.
The funding for the Citizenship Wage will come from multiple sources:
| Ending Means Tested Welfare | $319 Billion |
| Free Money dividend | $693 Billion |
| National Endowment dividend | $320 Billion |
| .75% annual wealth tax on wealth above $2 million | $386 Billion |
| TOTAL | $1710 Billion |
The Free-Rider Problem
1) Yes, some people are unproductive. But we are too wealthy a nation to let them starve, and for many, at least, this will be a cheaper solution than driving them to crime and then putting them in prison.
2) Yes, but this will be a very small fraction. Even those who appear to be doing “nothing” will, in fact, be contributing to their communities in non-monetary ways.
The Millionaire Problem
What about the other end of the spectrum? Surely, a family who is making $200,000 dollars a year or $1,000,000 a year does not need to be getting $8000 a year from the government, right?
It is important to remember that this is not a handout. We are not giving people this money because they need it. The citizenship wage is paid in recognition of the fact that we are all inheritors to a powerful economic engine capable of generating enormous wealth. This is a dividend vested to every American citizen as equal-share owners of our shared prosperity. Just as the poor cannot be disinherited from their legacy as Americans, neither can the rich.