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I like this idea and have been thinking about a similar instrument that is also a bit simpler. I call it US Equity, and the goal is the same: align interests to
by TheEzEzz 6y ago
I like this idea and have been thinking about a similar instrument that is also a bit simpler. I call it US Equity, and the goal is the same: align interests to the long term, rather than short term, and also prevent outside money from corrupting politicians. It works like this:
* After being elected to office a politician receives X shares of US Equity. They also renounce all other future forms of income (no more lucrative speeches or consulting jobs after office, etc)
* Every year, each share pays a dividend to the politician that is calculated based on some KPI we want politicians to be aligned to. For example, median household income.
* Shares are non-fungible and cannot be sold. These shares represent the entire future earnings of the politician, hence their incentives are for the longterm health of the country. They can't make money any other way, so they must double down on making a positive impact. Moreover, once they have Equity they can be less concerned about reelection, since their shares are lifelong.
* After a politician leaves office, they are just as incentivized to improve the nation. We thus have a large class of aligned ex-politicians that can help encourage healthy conversations across the country.
* We make the dividends pay out quite well, to encourage the best and brightest to become politicians. Because there's no need to find ways to make money on the side, we optimize for smart politicians, rather than corrupt politicians adept at squeezing their gig for cash.
I suspect this incentive structure would improve our bipartisanship and in general encourage politicians to get-shit-done.
- khafra 6y agoSounds good, but how do you choose KPIs that are more trouble to game and Goodhart than they are to fulfill honestly? Have a prediction market select them?
- jacques_chester 6y agoMy main tweak would be that inflation-adjusted Treasury bonds are the most likely such instrument. I would add the requirement that existing assets, except for (say) two residences + fixtures, four cars and some amount of cash is compulsorily acquired. The value of T-bonds paid is based on a Vickerey auction of the assets to be acquired.
- bpodgursky 6y agoI think my main hesitation here is the free-rider problem. Except for a couple super highly leveraged positions (ie, the Presidency), and individual representative could pretty easily do nothing to intentionally help the country. And even a super hard working rep can only move the needle so much.
- scotuswroteus 6y agoIn the U.S., the Supreme Court would strike down almost any imaginable mechanism you legislate to achieve this, and if it's done voluntarily, Congress itself would act to prohibit outside payment to legislators