Nineteen Trillion Solution
The $19 Trillion Solution is an economic reform proposal demonstrating that Australia's existing national wealth — approximately $19 trillion AUD — is sufficient to eliminate all public debt, pre-fund government operations for five years, and provide every citizen with income-producing assets, housing security, and a universal basic income. The proposal challenges the Scarcity Illusion that frames austerity and inequality as inevitable.
The proposal does not depend on future growth, new taxation, or borrowing. It reallocates existing wealth to address the root economic causes of crime, violence, homelessness, and social instability.
Overview
The Core Insight
Australia's total national wealth is approximately $19 trillion AUD. This includes:
- Real estate
- Superannuation (pension) assets
- Business equity
- Financial assets
- Infrastructure
- Natural resources
This wealth is heavily concentrated — the top 10% of households hold more wealth than the bottom 60% combined. The $19 Trillion Solution asks: what if this wealth were distributed differently?
Three-Part Allocation
| Allocation | Amount | Purpose |
|---|---|---|
| Debt Eradication | ~$787 billion | Clear all federal and state public debt |
| Government Prepayment | ~$5.29 trillion | Pre-fund all government operations for 5 years |
| Citizen Distribution | ~$12.92 trillion | Direct allocation to every Australian |
Part 1: Debt Eradication
Current Debt Situation
Australian public debt (federal and state combined) totals approximately $786.8 billion. This debt:
- Requires ongoing interest payments that consume budget resources
- Creates political leverage for austerity arguments
- Constrains policy flexibility
- Generates intergenerational equity concerns
Immediate Clearance
Allocating $787 billion (approximately 4% of national wealth) would:
- Eliminate all public debt instantly
- Free approximately $20 billion annually in interest payments
- Remove "we can't afford it" arguments from policy debates
- Stabilize national finances on a clean slate
Part 2: Government Prepayment
Current Government Spending
Australian government spending (federal, state, and local combined) is approximately $1.058 trillion annually. This funds:
- Healthcare and hospitals
- Education at all levels
- Social security and welfare
- Defense
- Infrastructure maintenance
- Public administration
Five-Year Prepayment
Allocating $5.29 trillion (approximately 28% of national wealth) would:
- Pre-fund all government operations for five years
- Eliminate annual budget stress and political gamesmanship
- Allow long-term planning without annual appropriation fights
- Provide stability for public servants and service recipients
- Create space for fundamental reform without crisis pressure
Part 3: Citizen Distribution
Remaining Wealth
After debt elimination and government prepayment, approximately $12.92 trillion remains — about 68% of national wealth.
Distribution Model
For Adults (20 and over)
Each adult receives $416,000 allocated as follows:
| Allocation Type | Amount | Form | Purpose |
|---|---|---|---|
| Income-producing assets | $104,000 (25%) | Business shares, cooperative ownership, dividend-paying investments | Ongoing income stream from economic activity |
| Housing security | $104,000 (25%) | Housing fund account | Down payment, rent security, or mortgage reduction |
| Universal basic income | $208,000 (50%) | Weekly payments of $800 for 5 years | Immediate economic security |
For Youth (Under 20)
Each young person receives $416,000 allocated differently:
| Allocation Type | Amount | Form | Purpose |
|---|---|---|---|
| Family-controlled assets | $104,000 (25%) | Business and housing assets managed by family | Family economic security |
| Weekly payments | $400/week | Direct payments (half adult rate) | Ongoing support |
| Trust allocation | $208,000 (50%) | Trust account for future access | Housing, education, or business investment upon adulthood |
Projected Impacts
1. Zero National Debt
All outstanding public financial obligations cleared. This:
- Eliminates interest payments (~$20 billion/year)
- Removes debt-based austerity arguments
- Strengthens national credit rating
- Frees resources for productive investment
2. Five-Year Government Security
Public services operate without annual budget stress:
- No government shutdowns or funding crises
- Long-term infrastructure planning becomes possible
- Public sector workforce stability
- Reduced political gamesmanship around appropriations
3. Universal Economic Floor
Every adult receives guaranteed:
- Income stream from ownership assets
- Housing security through housing fund
- Basic income of $800/week for five years
This transforms the relationship between citizens and the economy from dependency to ownership.
4. Work by Choice
With basic needs secured, employment becomes:
- A choice centered on passion rather than survival
- An opportunity for contribution rather than desperation
- A means of additional income rather than sole lifeline
Labor market dynamics shift when workers can refuse exploitative conditions.
5. Reduced Crime
Economic stress is the primary driver of property crime and a significant contributor to violent crime. By addressing root economic causes:
- Property crime loses its motivation
- Drug trade loses desperate participants
- Domestic violence (often linked to financial stress) decreases
- Youth recruitment into criminal enterprises becomes less attractive
See Crime Prevention Research and Justice as Prevention for the evidence base.
The Math
Wealth Sources
Australia's $19 trillion in national wealth comes from:
| Asset Class | Approximate Value | Share |
|---|---|---|
| Residential real estate | $10.0 trillion | 53% |
| Superannuation assets | $3.5 trillion | 18% |
| Commercial property | $1.5 trillion | 8% |
| Business equity (non-listed) | $1.2 trillion | 6% |
| Listed equities | $1.0 trillion | 5% |
| Cash and deposits | $1.0 trillion | 5% |
| Other assets | $0.8 trillion | 4% |
| Total | $19.0 trillion | 100% |
Population Figures
- Total Australian population: ~26 million
- Adults (20+): ~20 million
- Youth (under 20): ~6 million
Distribution Calculation
| Item | Calculation | Amount |
|---|---|---|
| Debt clearance | Federal + State debt | $0.787 trillion |
| 5-year government | $1.058T × 5 years | $5.290 trillion |
| Remaining for citizens | $19T - $0.787T - $5.29T | $12.923 trillion |
| Per-person allocation | $12.923T ÷ 26M | ~$497,000 average |
| Adjusted per adult/youth | Differential allocation | $416,000 each |
Implementation Challenges
Asset Liquidity
Not all wealth is liquid. Real estate, business equity, and superannuation cannot be instantly converted to cash without market disruption.
Potential approaches:
- Phased implementation over 10-20 years
- Equity shares rather than cash distribution
- Hybrid instruments combining income streams with ownership stakes
- Asset-backed securities representing citizen claims
Inflation Risk
Rapid wealth redistribution could trigger inflation if:
- More money chases the same goods
- Supply chains cannot scale to meet demand
- Currency confidence weakens
Mitigations:
- Phased distribution to allow supply adjustment
- Investment in productive capacity alongside distribution
- Monitoring and adjustment mechanisms
- Focus on assets and income streams rather than lump sums
Political Resistance
Concentrated wealth implies concentrated political power opposing redistribution.
Considerations:
- Proposal demonstrates mathematical possibility, shifting debate
- International examples of successful redistribution (Nordic social democracies, post-WWII reforms)
- Crisis conditions may create political windows
- Generational change in wealth concentration may shift political coalitions
Transition Effects
Major economic restructuring creates transitional disruption:
- Real estate prices would likely adjust
- Labor market dynamics would shift
- Business models dependent on economic desperation would fail
- New economic patterns would emerge
These are features, not bugs — but transition requires careful management.
Philosophical Foundation
Ownership vs. Dependency
The $19 Trillion Solution transforms citizens from:
- Dependents — relying on wages, welfare, or charity
- To Owners — holding stakes in the economic system
This aligns with the Two Monkey Theory insight: people tolerate unfair systems partly because they lack alternative coordination mechanisms. Universal ownership creates stakes in fair operation.
Prevention vs. Punishment
Rather than addressing symptoms (crime, homelessness, domestic violence) through punishment, the proposal addresses root causes through security. See Prevention Over Punishment.
The Scarcity Illusion
The proposal directly challenges scarcity narratives:
- "We can't afford..." becomes clearly false when $19 trillion exists
- Distribution choices are revealed as political, not mathematical
- Abundance is shown to be achievable with existing resources
International Comparisons
Existing Wealth Distribution Programs
| Country/Program | Mechanism | Scale | Outcomes |
|---|---|---|---|
| Alaska Permanent Fund | Oil revenue dividends to all residents | ~$1,600/year/person | Reduced poverty, maintained popularity across political spectrum |
| Norway Sovereign Wealth Fund | National investment fund from oil revenue | $1.4 trillion (largest in world) | Intergenerational wealth preservation, universal benefit |
| Singapore CPF | Mandatory savings with government contribution | Universal participation | High home ownership, retirement security |
| Baby bonds (US proposals) | Trust accounts for children at birth | $1,000-$50,000 depending on family income | Projected wealth gap reduction |
Post-Crisis Redistributions
Major wealth redistributions have occurred after crises:
- Post-WWII Europe: Massive expansion of social democracy, nationalization, and redistribution
- South Korea land reform (1950s): Redistribution of agricultural land transformed rural poverty
- Taiwan land reform: Similar pattern with dramatic development outcomes
Connection to OMXUS
The $19 Trillion Solution provides the economic foundation for OMXUS participation:
| OMXUS Component | Economic Foundation |
|---|---|
| Direct Democracy | Citizens with economic security can participate in governance |
| Web of Trust | Economic security enables long-term relationship investment |
| Emergency Response | Communities with resources can respond to crises |
| Grief to Design | Prevention funding replaces punishment spending |
Economic security is not sufficient for human flourishing, but it is necessary. The $19 Trillion Solution provides the floor from which OMXUS social infrastructure can grow.
See Also
- Scarcity Illusion
- Two Monkey Theory
- Prevention Over Punishment
- Justice as Prevention
- Economic Analysis
- Grief to Design
- Principles
- Main Page
References
- Australian Bureau of Statistics. Household Income and Wealth, Australia. Various years.
- Reserve Bank of Australia. Household and Business Balance Sheets.
- Australian Government Budget Papers. Various years.
- Piketty, T. (2014). Capital in the Twenty-First Century. Harvard University Press.
- Wilkinson, R. G., & Pickett, K. (2009). The Spirit Level: Why More Equal Societies Almost Always Do Better. Allen Lane.