The Just Third Way and Capital Homesteading in Ireland

In early February, CESJ sent copies of Capital Homesteading for Every Citizen to a number of party leaders and other politicians in Ireland. (The Capital Homesteading "flyer," designed for ordinary people is also useful, as is the Capital Homestead "Summary," intended as a guide for policymakers.) Yesterday we received an acknowledgment and thank-you from the Hon. Enda Kenny, leader of the Fine Gael party, Ireland's second largest political party, which describes itself as being in the "progressive center." Mr. Kenny's note was brief but substantive, as befits an Irish politician (or any politician, for that matter) in these times of crisis when more immediate matters take precedence — such as saving his country from financial meltdown.

Fine Gael's platform appears consistent with the Just Third Way in many respects, or expresses goals that can be met efficiently and effectively by implementing Capital Homesteading and other Just Third Way programs. This would not only allow Fine Gael to work more effectively with its traditional partner in government, the Irish Labor Party, but also Fine Fail, the Irish Republican Party, Ireland's largest political party and the one currently in power. Fine Gael's focus on law and order, enterprise and reward, and fiscal responsibility, along with its advocacy of limited State involvement in the economy, can easily fit into a Capital Homesteading program based on the four pillars of a just economy:

• Limited economic role for the State,

• Free and open markets for maximizing incentives and choice in determining just prices, just wages, and just profits,

• Restoration of traditional rights of private property, and

• The lifting of barriers that inhibit or prevent universal access to direct ownership of the means of production.

Even Fine Gael's position that the State has a necessary role in financing and owning infrastructure can be modified without violating any of the party's basic principles through the use of Community Investment Corporations, or "CICs." A CIC would enable citizens in a region to own the land and infrastructure directly by issuing each one a single no cost, non-transferable, fully voting, fully participating share in the CIC, which would hold legal title. Infrastructure could then be financed by no-interest capital credit loans extended by commercial banks to the CIC and discounted at the central bank. (N.B. — "No-interest" does not mean "free." Both commercial banks and central banks must still charge service fees to cover expenses and, in the case of commercial banks, meet the "risk premium" for capital credit insurance and generate a just profit for their shareholders.)

Such improvements would be repaid not out of taxes collected by the State, but out of revenue generated by user fees such as tolls for roads and bridges, and service charges for sewage, water, and similar utilities. Overcharges would be returned to the citizens in the form of dividends that would be tax-deductible at the corporate level, and all new infrastructure financed not by bond issues or increased taxes, but through the extension of commercial bank credit discounted at the central bank. This would enhance the value of the currency by backing it with existing hard assets or assets in construction instead of the less-certain future tax collections as is currently the case in most countries. If the central bank were to be owned by every citizen of a country in the same way that every citizen in a region would own a CIC, any excess revenue could also be returned to the citizens in the form of dividends — and the fiscal and monetary system would be more directly accountable to the citizens.

The bottom line is that the Just Third Way has a great deal to offer Mr. Kenny and Fine Gael, to say nothing of every other party in the Republic. His response gives some promise that Capital Homesteading will, indeed, begin to receive serious consideration at the highest levels of government in Ireland.