PUT PEOPLE FIRST: Progressive Ideas for Economic Reform
The Internet is full of complaints about our current political and economic arrangements. Our current political economy has led to a reduction in the number of semi-skilled jobs, a stagnation of real wages, a loss or substantial reduction in manufacturing businesses, financial gambling and speculation, more frequent and severe recessions, and the observation that our political representatives are more responsive to corporate interests than to the needs and wants of our people. So, there is a lot to complain about! But we need to do more than complain. We need to explore potential remedies.
Conservatives have been offering up the same remedies for over 30 years now: tax cuts, chiefly for the wealthy; and corporate deregulation. Are we better off now? Rich people are. The rest of us, not so much. Look at Kansas.
What conservatives have been saying is, “Only rich lives matter.” The rest of us are just slugs feeding off of what trickles down from the wealthy. So you get “avoid and neglect” conservatism: avoid the problems and neglect the victims. Just make sure the rich get richer. Well, only a fool continues to do the same thing expecting different results!
So I’ve combed through books and articles by some economists I think are more progressive, or post-neoliberal, for ideas that are likely to really improve the economic lives of the 99% of Americans. I found answers in works by economists Joseph Stiglitz, Robert Reich, Ha-Joon Chang, and a number of others. There’s a bibliography at the end of this post, for anyone who wants to read more about these ideas and the rationales behind them.
Gathering and sifting through their ideas, the following struck me as most consequential:
1. Increase jobs for the 99%
- Make public investments in domestic infrastructure projects.
- Take measures to encourage growth and survival of labor-intensive industrial sectors, especially those critical to national security and independence. Such measures could include:
◦ Subsidies for Research and Development;
◦ Subsidized credit;
◦ Direct lending by public institutions;
◦ Regulation of industrial investments;
◦ Export assistance; and
◦ Support for needed training.
- End tax deferment on corporate profits earned abroad. Deferment discourages repatriation of earnings.
- Enact a financial transaction tax, to dampen speculation, reduce financial market volatility, and encourage longer-term investment.
- Take measures to further reduce corporate monopolies, trusts and cartels. For example, reduce the scope and duration of patents.
2. Increase income for the 99%
- Raise the minimum wage
- Raise the Earned Income Tax Credit
- Make unionizing easier and penalize anti-union actions more severely
3. Reduce burdens on the 99%
- Make voting easier, for example, with weekend elections and more voting stations
- Restore student loan bankruptcy protections
- Push for the Durbin amendment to the Dodd-Frank bill, which will bring down the excessive fees that the debit card companies now impose on merchants, and which are passed along to consumers in the form of higher prices.
- Create a homeowners’ chapter 11, analogous to corporate chapter 11
- Reduce the likelihood of forced financial industry bailouts, by
◦ Increasing capital surcharges for the largest banks
◦ Requiring all lending institutions to document how they plan to unwind in the event of bankruptcy
◦ Establishing strict rules for bailouts and reimbursement of public funds
◦ [I would add prosecution for bailouts necessitated by malpractice!]
- Remove special protections for derivatives in corporate bankruptcies
- Raise the top marginal income tax rate.
- Tax capital gains and dividends at the same rates as wages
- Reduce opportunities and means for tax evasion
- Eliminate costly tax breaks
- Apply value-added taxes [VATs] to luxury items
4. Increase benefits for the 99%
- Enact “Medicare for All,” of course.
- Subsidize pre-K childcare.
- Provide public financial support for post-secondary education.
- Enable the Postal Service to provide a public-banking option.
- Create a public option for housing finance.
- Expand Social Security by removing payroll caps, and add public options for additional retirement investing, like the Thrift Savings Program for Federal employees.
5. Improve the quality of life for the 99%
- Restrict political donations to *natural citizens*, and maintain low donation limits
- Tax pollution (including carbon emissions)
- Work with other nations to change the WTO’s rules, interpretations of rules, policies, goals and overall agenda so that the needs of populations are treated as more important than the desires of corporations.
- Require that international trade agreements be approved by the International Labor Organization [ILO]
- Join with other nations to create an International Finance Organization (IFO), whose chief objective would be to reduce the risk of international financial meltdowns. The IFO would be responsible for things like:
◦ Establishing rules for international finance
◦ Ensuring transparency and accountability in international finance
◦ Monitoring and reporting developments in international finance
◦ Supervising the IMF and World Bank
I’m sure that Conservatives will call these ideas “socialist,” even though there’s no proposal that the government should own the means of production and distribution. That would be the dictionary definition of Socialism. But Conservatives will call anything “socialist” that limits self-centered, narrow-minded behavior.
These proposals actually assume that there will be private property and that there will be private markets. They just shouldn’t have unfettered control over the political and economic lives of the American people! The American people, to ensure their general welfare, must have priority over them.
Ha-Joon Chang and Ilene Grabel,
Reclaiming Development: An Alternative Economic Policy Manual,
Zed Books Ltd., 2004/2014
John Eatwell and Lance Taylor,
“Towards an Effective Regulation of International Capital Markets,”
Internationale Politik und Gesellschaft, 3/99
Aftershock: The Next Economy and America's Future,
Knopf Doubleday Publishing Group, 2010
“The Coming Great Transformation,”
Journal of Policy Modeling, 2017
Joseph Stiglitz, Nell Abernathy, Adam Hersh, Mike Konczal, Susan Holmberg,
“Rewriting the Rules of the American Economy: an Agenda for Growth and Shared Prosperity,”
Roosevelt Institute, 2015