‘We have it in our power to begin the world over again.’
Thomas Paine
It’s nearly three years since we published our commentary called, ‘The Black Hole of Economics’, drawing attention to the 300-year-old failure of that discipline to link with the human life-cycle in order to resolve the chronic poverty and disadvantage suffered by so many young people. It seems so obvious to use that part of inheritance which is not allocated for family descendants — children and/or grandchildren — for this purpose, empowering huge numbers of disadvantaged young people with resources and life skills to help them also, to achieve their potential in adult life.
‘The Black Hole of Economics’ has been posted as an article on the Academia website, and it has received a lot of focus there.
I was therefore delighted when the Faculty of Economics and Kings College, Cambridge proposed hosting a two-day conference on intergenerational rebalancing, and we agreed that it should be held at the Institute for Fiscal Studies in London on 14/15 May. It is now available via www.sharealliance.org.uk/advocacy for everyone to see, complete with a written summary from Tina Zhang, and videos and slides for almost all presentations. The videos are also accessible on the Share Alliance YouTube channel.
On the webpage, you'll also find the journey taken so far by Share Alliance towards introducing a more egalitarian form of capitalism, starting with my presentation to Z/Yen in 2021 and including our first conference at Kings College, Cambridge in April 2023.
The journey from ideas to action should follow a disciplined path through research, education, advocacy, and finally implementation. If only politicians could work on this basis, rather than waking up with a bright idea one morning and then imposing years of disruption, expense and often failure on everyone: HS2, take note.
The first, academic day of the Inter-generational Rebalancing Conference focused on research, and it’s fair to say that each speaker explored their own particular area in detail. These covered family endowments and influence, including complex structures and delinquency, and the impact of house prices, There was no particular reference to ring-fencing inheritance levies, and the scope of research was focused on particular nations rather than being global in context.
On the second, policy day there was a somewhat broader context. Both David Willetts and Paul Johnson spoke of the huge wealth imbalances affecting society, and Julian Le Grand, who played a significant part in developing the Child Trust Fund for Gordon Brown, explained how asset-based egalitarianism was so much more effective in tackling poverty than the provision of welfare benefits.
I spoke on the broad issue of starter capital accounts and incentivised learning — a link to the text of my presentation is included on the Share Alliance webpage — and Heloïse Greeff described the significant progress that has been made with ‘Stock for Data and Creativity’, and how this could help to re-balance opportunities for young people: last week's commentary offered her presentation as a response to the Pope’s AI encyclical challenge.
The final speaker was Matthew Agarwala, who not only set out the taxation challenge posed by Artificial Intelligence but also showed how India is opening the door for an immense step forward, with a resilient and reliable method of providing financial empowerment: the Universal Payments Interface (UPI) system, which is now used by over half a billion people.
It's now for Share Alliance to gather together all these inspiring contributions and, as we indicated on 18 May, to plan the next step forward.
In the past few centuries the concept of asset-based egalitarianism can track its roots to Thomas Paine (1737—1809), although the Wikipedia page tracks it back to the fifty-year Jubilee cycle, a description of which can be found in the biblical book of Leviticus. The Wikipedia article mentions funding the distribution of wealth from inheritance tax; however, it also refers to the need for building life skills (which The Share Foundation has tackled through incentivised learning).
So, the logic of tackling the black hole of economics is there, although it doesn't get much attention from politicians at present. Throughout the past decade, I have been asking HM Treasury for inheritance tax to be hypothecated for targeted (not universal) provision of starter capital accounts for disadvantaged young people, but with no success.
However, the Conference has provided us with a springboard for taking progress forward. In the United Kingdom, The Share Foundation will continue to press for Government to provide the regulations and logistics for their Child Trust Fund Mark 2 proposal: perhaps the arrival of a new Economic Secretary at HM Treasury (Rachel Blake MP) will provide a new sense of purpose and prioritisation.
We will also seek to expand educational resources for asset-based egalitarianism, or egalitarian capitalism, maintaining the focus on individual ownership and responsibility, while also incorporating the important role played by incentivised learning in achieving an attitudinal transformation.
We will explore the potential for global pilot operations for both inter-generational rebalancing and ‘Stock for Data and Creativity’. The former would be funded philanthropically, and it would use established routes for empowering disadvantaged communities in Africa; while the latter is likely to focus on India and the UPI process which Matthew Agarwala described.
The Conference has therefore played an important role in moving us forward from research towards implementation. Rome wasn't built in a day: however, these days progress happens much faster than two thousand years ago. Nevertheless, if we are to succeed in changing the world's economic system so that humanity can enjoy an alternative to the two ‘serfdoms’ on offer at present (socialism, and the intense polarisation of wealth which characterises traditional capitalism), we will welcome any help on offer.
Gavin Oldham OBE
Share Radio