In the face of growing wealth inequality worldwide, more and more people are discussing alternatives to the current laissez-faire capitalism status quo. Tamara Belinfanti, Sergio Gramitto and the late Lynn Stout offer up their own solution in Citizen Capitalism: How a Universal Fund Can Provide Influence and Income to All.
The authors have devised a concept they call the Universal Fund. It’s like a sovereign wealth fund but is privately created and funded via private ordering. That means that the Universal Fund is to be created from donations of stocks by companies and philanthropists. The government would hence be uninvolved; the Universal Fund is not a socialist venture. Rather, it is in part modeled on the structure of NGOs like the Sierra Club and the Red Cross. The Fund would provide an annual dividend to every citizen, with no maximum income cap. Though it may seem absurd to send welfare payments to the wealthy, it’s politically savvy framing. A free public college bill was passed in ultraconservative Tennessee thanks to having no maximum income cap; conservative detractors weren’t able to use the “class warfare” and “welfare queen” arguments. It should be noted that charitable tax deductions, estate tax reductions, and lowered tax brackets would act as a de facto government incentive for the wealthy to donate to the Universal Fund.
The goals of the Universal Fund would be to decrease wealth inequality, encourage long-term investment and increase civic engagement in corporate culture. On the last point, the authors remind us that, “The top 10% [of wealthiest Americans] hold more than 90% of all shares.” Even in regards to the other 10% of shares owned, most of them are passively owned. Most small-time investors don’t have time to vote at the annual general meetings of every company in which they are invested. Thus, boardroom votes are dominated by two shareholder proxy advisory firms and individual investors who own a substantial percentage of shares, as well as fund portfolio & hedge fund managers.
These Wall Street elites naturally tend to vote based upon their elitist interests. Thus, they usually make decisions that are insane in terms of employee welfare, long-term corporate growth, executive pay, and the environment. For example, `the authors remind us of the recent case of Martin Shkreli, the hedge fund manager who acquired Turing Pharmaceuticals and then raised AIDS medication prices from $13.50 to $750. This is the embodiment of the Reagan-era Golden Rule of maximizing shareholder value. Not only is this Gordon Gecko truism objectively crazy, but it’s also actually legally unfounded. Contrary to what you hear on CNBC or Fox Business, there’s no legal requirement that companies only focus on maximizing shareholder value. The book relates the following quote from Supreme Court Justice Samuel Alito’s comments in the recent case Burwell v. Hobby Lobby: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not do so.”
Citizen Capitalism points to the ongoing successes of the sovereign wealth funds of Norway and Alaska, ultraliberal and ultraconservative societies, respectively. The Alaskan fund generally provides each citizen with a dividend payment of a few thousand dollars each year, via the state’s oil revenues. The Government Pension Fund Norway is a more pertinent example since it’s funded through a $1 trillion stock portfolio. Norway is not only able to fund its citizens’ pensions through the Fund, but also exert moral influence on the market. The Fund boycotts various egregious companies, like cigarette manufacturers, and will sell its shares in a company that gets exposed for abusive practices, like employing child labor. Our authors likewise want the Universal Fund to use a carrot-and-stick approach in regards to corporate ethics.
The thesis of Citizen Capitalism is, as the title suggests, rooted in optimism for capitalism. Though they write about the success of the socialist program in Alaska specifically, a conservative state in the US, the authors are convinced that a sovereign wealth fund bill could never be passed in Congress. Recent polls and election results, however, show that Americans are starting to overwhelmingly favor ambitious government-program proposals like Medicare for All and a Green New Deal. As I wrote before, the Universal Fund would mostly be feasible due to tax incentives; these government incentives would likely need to be greatly expanded in order to encourage enough stock donations to build the Fund to a substantial size. Even America’s greatest philanthropists still stockpile billions of dollars in their offshore bank accounts. Thus, one shouldn’t expect the Universal Fund or other private UBI schemes to become a replacement for state management of wealth inequality through programs like public school funding and marginal taxation. Nonetheless, Citizen Capitalism is a stimulating little primer for rethinking the relationship between Wall Street and Main Street managing the looming crises of a rapidly aging workforce and automation, plus the balancing of private and public sectors in regards to solving societal problems.
How Canadian churches are helping their communities cope with the wildfires
As wildfires burn across Canada, churches are finding ways to support their members and the broader community directly impacted by the crisis.
According to the Canadian Interagency Forest Fire Centre, as of June 13, there are 462 active fires across Canada – and 236 of them classified as out of control fires.
Whether it’s through phone calls or donations to community members, here’s how a few churches across Canada are handling active wildfires and the aftermath in their regions.
Westwood Hills, N.S.: St. Nicholas Anglican Church
In Nova Scotia, St. Nicholas Anglican Church and other churches in the area are collecting money for grocery cards to give to families impacted by the Tantallon wildfire.
The fire is now considered contained, but Tanya Moxley, the treasurer at St. Nicholas is organizing efforts to get grocery gift cards into the hands of impacted families.
As of June 12, four churches in the area – St. Nicholas, Parish of French Village, St Margaret of Scotland and St John the Evangelist – raised nearly $3,500. The money will be split for families’ groceries between five schools in the area impacted by the wildfire.
Moxley said she felt driven to raise this money after she heard the principal of her child’s school was using his own money to buy groceries for impacted families in their area.
“[For] most of those people who were evacuated, the power was off in their subdivision for three, four or five days,” she said. “Even though they went home and their house was still standing, the power was off and they lost all their groceries.”
Moxley said many people in the area are still “reeling” from the fires. She said the church has an important role to help community members during this time.
“We’re called to feed the hungry and clothe the naked and house the homeless and all that stuff, right? So this is it. This is like where the rubber hits the road.”
Is it ever OK to steal from a grocery store?
Mythologized in the legend of Robin Hood and lyricized in Les Misérables, it’s a debate as old as time: is it ever permissible to steal food? And if so, under what conditions? Now, amid Canada’s affordability crisis, the dilemma has extended beyond theatrical debate and into grocery stores.
Although the idea that theft is wrong is both a legally enshrined and socially accepted norm, the price of groceries can also feel criminally high to some — industry data shows that grocery stores can lose between $2,000 and $5,000 a week on average from theft. According to Statistics Canada, most grocery item price increases surged by double digits between 2021 and 2022. To no one’s surprise, grocery store theft is reportedly on the rise as a result. And if recent coverage of the issue rings true, some Canadians don’t feel bad about shoplifting. But should they?
Kieran Oberman, an associate professor of philosophy at the London School of Economics and Political Science in the United Kingdom, coined the term “re-distributive theft” in his 2012 paper “Is Theft Wrong?” In simplest terms, redistributive theft is based on the idea that people with too little could ethically take from those who have too much.
“Everybody, when they think about it, accepts that theft is sometimes permissible if you make the case extreme enough,” Oberman tells me over Zoom. “The question is, when exactly is it permissible?”
Almost no one, Oberman argues, believes the current distribution of wealth across the world is just. We have an inkling that theft is bad, but that inequality is too. As more and more Canadians feel the pinch of inflation, grocery store heirs accumulate riches — Loblaw chair and president Galen Weston, for instance, received a 55 percent boost in compensation in 2022, taking in around $8.4 million for the year. Should someone struggling with rising prices feel guilty when they, say, “forget” to scan a bundle of zucchini?
The homeless refugee crisis in Toronto illustrates Canada’s broken promises
Canadians live in a time of threadbare morality. Nowhere is this more obvious than in Toronto’s entertainment district, where partygoers delight in spending disposable income while skirting refugees sleeping on sidewalks. The growing pile of luggage at the downtown corner of Peter and Richmond streets resembles the lost baggage section at Pearson airport but is the broken-hearted terminus at the centre of a cruel city.
At the crux of a refugee funding war between the municipal and federal governments are those who have fled persecution for the promise of Canada’s protection. Until June 1, asylum seekers used to arrive at the airport and be sent to Toronto’s Streets to Homes Referral Assessment Centre at 129 Peter St. in search of shelter beds. Now, Toronto’s overcrowded shelter system is closed to these newcomers, so they sleep on the street.
New mayor Olivia Chow pushed the federal government Wednesday for at least $160 million to cope with the surge of refugees in the shelter system. She rightly highlights that refugees are a federal responsibility. In response, the department of Immigration, Refugees, and Citizenship Canada points to hundreds of millions in dollars already allocated to cities across Canada through the Interim Housing Assistance Program, while Ontario says it has given nearly $100 million to organizations that support refugees. But these efforts are simply not enough to deliver on Canada’s benevolent promise to the world’s most vulnerable.
The lack of federal generosity and finger-pointing by the city has orchestrated a moral crisis. It’s reminiscent of the crisis south of the border, where Texas governor Greg Abbott keeps bussing migrants to cities located in northern Democratic states. Without the necessary resources, information, and sometimes the language skills needed to navigate the bureaucratic mazes, those who fled turbulent homelands for Canada have become political pawns.
But Torontonians haven’t always been this callous.
In Ireland Park, at Lake Ontario’s edge, five statues of gaunt and grateful refugees gaze at their new home: Toronto circa 1847. These statues honour a time when Toronto, with a population of only 20,000 people, welcomed 38,500 famine-stricken migrants from Ireland. It paralleled the “Come From Away” event of 9/11 in Gander, N.L., where the population doubled overnight, and the people discovered there was indeed more than enough for all. It was a time when the city lived up to its moniker as “Toronto, The Good.”
Now, as a wealthy city of three million people, the city’s residents are tasked with supporting far fewer newcomers. Can we not recognize the absurdity in claiming scarcity?
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