Public Capital is a Public Good

Kevin Cox
3 min readApr 13, 2022
That man is the most loyal who aims at the noblest motive, and that motive is the public good — Virgil.

Public Capital is the value of a community knowing how to use an asset to generate income. Public Capital has the following characteristics.

  • All community members have equal access to Public Capital. The community is the owner and guarantor of the Capital.
  • Within a community, Public Capital moves without cost. It is a Balance Sheet entry in the accounts and does not affect the Profit and Loss or incur any charge.
  • The community allocates Public Capital according to need.
  • The community defines need.
  • Public Capital makes things of value without destroying itself.
  • Buyers receive half of the Public Capital part of a payment.
  • Public Capital merges seamlessly with Private Capital as they are both forms of the same money with different rules.
  • Public Capital distributes capital through a community when Public Assets generate income.
  • Community members can own and buy and sell Public Capital to other community members.
  • If a non-member purchases Public Capital, they become a community member.
  • Public Capital is never rented.

Private Capital

Private Capital is the value of knowing how to use an asset to generate income and the knowledge being owned by an entity that lives within a community.

A Private Asset is an asset owned by a single entity. Profits generated by the asset are the property of the single entity, and losses are the owner's responsibility. We can turn Private Assets into Private Capital by monetising them. Banks create Private Capital by issuing a loan secured against the asset. The money now becomes Private Capital and generates income by being lent to another party, and the party pays interest for its use.

Loans turn out to be expensive because they create capital that can earn money while still leaving the Private Asset to continue to generate profits. Loans create Private Capital before it makes a profit. It gives rise to many opportunities for entities to create more Private Capital without generating goods and services to justify the money. Central Banks have targeted inflation to remove some of the excess money. It is the reason we need expensive money markets in addition to markets in goods and services.

Private Capital is a valuable technology, but Public Capital is a less expensive form of monetisation. With Public Capital, we still monetise assets and allow banks to create money. However, within a local community, for a given set of assets, we do not pay rent on the money as a way to provide a return on Capital. Instead, we use Capital to reduce the cost of producing goods and services, and we give a return on investment with lower prices.

Governments can create Public Capital by issuing money directly to community groups. This approach is much better than the government giving grants because the community groups pay back the money.

Comparisons between Public and Private Capital

Any income-generating asset can convert to Public or Private Capital. If we convert it into Public Capital, it costs less to use, which means investors get higher returns, and consumers get lower prices or costs. A family car where everyone in the family gets to use it is more valuable than a car where one person in the family is the only one allowed to use it.

Public Capital is a more efficient way to invest than Private Capital. Investors rent Private Capital and receive more money back than they lend. Public Capital has no rental charge as the money stays within the community, and the return is in goods and services.

When loaned as debt, the money comes back, and the loan value is destroyed but only after paying interest. The loan appears to generate extra money, but that may not happen. If Public Capital does not generate goods and services the money goes.

Other methods such as mutual credit, crypto money, and local currencies remove the need to rent money. However, Public Capital is more convenient, and it has the advantage of transferring Capital between entities without the need for expensive money markets.



Kevin Cox

Kevin works on empowering individuals within local communities to rid the economy of unearned income.