Ideas from YLS Professors Become British Election Proposals
In their book "The Stakeholder Society" (published by Yale University Press in 1999), Bruce Ackerman and Anne Alstott proposed that each American citizen be guaranteed a stake of $80,000 upon reaching maturity. They crafted the proposal to address the widening material gap between rich and poor Americans--and the difference in opportunity this creates. "For us, the central task of government is to guarantee genuine equality of opportunity," they wrote. And their stake would grant new possibilities and security to millions of young Americans.
"Our plan seeks justice by rooting it in capitalism's preeminent value: the importance of private property. It points the way to a society that is more democratic, more productive, and more free," Ackerman and Alstott insisted.
And at least one politician agreed. British Prime Minister Tony Blair introduced the idea of a "baby bond," in which the government would make an investment for each child born, as the big idea in his most recent campaign. How did the stakeholder concept cross the Atlantic Ocean, migrating from 127 Wall Street to 10 Downing Street?
As with all beginnings, the genesis of the idea was a bit of a mystery. Thomas Paine had proposed something similar more than 200 years ago, but other than that, "[We] just made it up," says Ackerman. They developed it and fortified it--until it could live on its own as a book.
A professor at the London School of Economics, Julian LeGrand, picked up this book and in turn wrote a paper himself suggesting a grant of $10,000 to young British citizens. The idea was quickly absorbed by the influential Institute for Public Policy Research, where it metamorphosed into the form of a bond rather than a grant--and Blair announced his support of it in April 2001, during a general election campaign.
By the time the idea emerged as Blair's baby bond, it had lost several of the features Alstott and Ackerman had suggested. For instance, the value had dropped from $80,000 to a $500 bond that could appreciate to as much as $5,000 by the time the child reached age eighteen. Blair also proposed restricting the potential uses of the money, while Ackerman and Alstott would leave stakeholders free to use their money for any purpose.
"The Stakeholder Society" also calls for originally funding the grant with a two percent wealth tax and then recovering the initial investment from the estates of stakeholders--provisions which the politicians didn't embrace. However, the central purpose of reducing the difference in opportunity between the wealthy and the poor remained, along with the concept of giving young people a stake in society.
Ackerman is pleased with the consideration these proposals have received. Indeed, he's almost surprised at the robust developments his ideas have generated. "It's by people reading books. . . . Who would have imagined?" he asks.
But the sad fact of survival outside the nest means that the baby bond is currently delayed, suspended in the aftermath of September 11, even though Blair won the electoral mandate to implement the program. It probably won't see its final incarnation as policy for another year or two.
However, a new cycle is already beginning with Ackerman's next project. This time he has teamed with Professor Ian Ayres on a book to address problems in the American system of campaign financing, titled "Voting with Dollars," which will be published by Yale University Press in April 2002.
The central ideas are: First, each American should receive fifty "Patriot dollars"--just as each receives an equal vote--to be donated to political campaigns of his or her choice. The money generated by this approach would overwhelm special-interest donations, without requiring any restrictions on giving.
Second, Ackerman and Ayres propose that private donations be passed through a blind trust--on analogy with the secret ballot box--so that candidates will not know who has given them money. "A secret donation booth makes it harder for candidates to sell access or influence," they write.
Ackerman posits that the advantage to this approach to reform is that it creates "more speech, and it's more fairly distributed." And he thinks that the nation is ready for changes in the system.
Ackerman sees a continuous theme between the two books in the effort to adapt market systems for purposes of democracy and equality. And he hopes his proposals for campaign finance reform will, like his stakeholder ideas, have an effect on policy debates. "My job is to generate ideas that actually could work," he concludes.
Yale University Press