Posted
February 3, 2007

Vermont Considers a Commons Trust

Vermont considers bold legislation to preserve the state's common wealth.

One of the highlights of my recent book tour was a two-day visit to Vermont. On the day I arrived in Montpelier, Senator Hinda Miller introduced a bill to create a Vermont Common Assets Trust. If the bill passes, the Trust could do just about everything I advocate in my book, Capitalism 3.0! (Click here for text of the bill.) The purpose of the Trust is to manage the state’s common wealth (air, water, undisturbed habitat, ecosystems, broadcast spectrum and so on) on behalf of future generations and all living citizens equally.

When such assets are excessively polluted, privatized or depleted, the Trust could establish clear limits on their use, charge fees for such use, and distribute much of the revenue to all Vermonters equally. In this latter function it would resemble the Alaska Permanent Fund, which for 25 years has used oil lease revenue to pay equal dividends to all Alaskans. (Last year’s dividend was $1,106.)

Such a trust, were Vermont to create it, would represent a historic shift in America’s approach to managing nature’s invaluable gifts. Under our present laissez-faire system, most natural assets can be used without cost or limit. For example, groundwater can be pumped and carbon dioxide spewed into the atmosphere without limit or monetary cost. There are real costs, of course, but they’re paid by future generations and other species, rather than by the corporations or consumers that immediately benefit from the natural asset.

The Vermont Trust would make users pay something closer to the true cost of the natural assets they use. It would thereby discourage overuse and protect Vermont’s ecosystems for future generations.

The most obvious asset such a Trust could manage is Vermont’s air – in particular, the air’s capacity to store heat-trapping greenhouse gases. That capacity is nearly exhausted, as Vermont recognized when it joined the Regional Greenhouse Gas Initiative (RGGI) in 2003. But RGGI applies only to emissions from fossil-fuel burning power plants, which leaves 98 percent of Vermont’s emissions uncapped and unpriced.

That’s where the Trust could step in. It could set a gradually declining cap on all of Vermont’s carbon dioxide emissions, auction permits to emitters, and use the revenue for clean energy, public transit and equal dividends to all Vermonters. Prices for fossil fuel burning would rise, but everyone would get dividends to offset that rise. People who burn lots of fossil fuel would pay more in higher prices than they’d get back in dividends; people who conserve fossil fuel would get back more than they pay in.

In other words, conservers would gain and gluttons would lose, but all Vermonters would get cash back. Such a carbon capping system would also stimulate local economic development by boosting demand for energy conservation, wind and solar power, and biofuels.

Over the longer term, the Common Assets Trust might also look at Vermont’s underground water resources, which at present are subject to unlimited exploitation. (Think of the Nestle Corporation’s extraction of Maine’s underground water at Poland Springs.)

Miller’s bill has several co-sponsors, and I later testified (by phone) on its behalf. Whether or not it passes this year, what’s truly remarkable is that Vermonters are thinking and talking about their common wealth, and considering innovative ways to manage it.

Next: An amazing day in Massachusetts.