Tuesday, May 29, 2012

Own or Be Owned — Capital Homesteading Now

In 1862 Abraham Lincoln signed the Homestead Act, allowing people to acquire and possess landed capital in return for a promise to make the land productive. The amount of land, however, is limited. Not everyone who wanted to own capital could do so.

Human wants and needs — and flawed institutions, such as tax and monetary systems — are the only effective limits to today's commercial and industrial frontier. Flawed institutions favor the rich, limit opportunity for the 99%, and concentrate capital ownership in the few.

Capital Homesteading is a 21st century proposal that would make it possible for people without existing savings or collateral to settle the commercial and industrial capital frontier on better terms than were available to those who settled the landed capital frontier in the 19th century. Without redistributing existing wealth, each year every citizen would be able to acquire an equal amount of capital to be formed that year on credit, collateralize the loan with capital credit insurance, and pay for the capital with the profits of the capital itself.

Capital Homesteading is neither capitalism, which concentrates capital ownership or control in the hands of a small private elite, nor socialism, which concentrates ownership or control in a State bureaucracy. Capital Homesteading is a Just, Third Way that transcends the failed systems of the past. It would make the American dream of a sovereign, independent people a reality. As Ronald Reagan said, "Could there be a better answer to the stupidity of Karl Marx than millions of workers individually sharing in the ownership of the means of production?"

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