In a recent post, I made a comment about wealth redistribution. Historically speaking, it was a common result of too many people accumulating outsized wealth for no reason obvious to others in the society. The mechanisms for redistribution have been either taxation or revolution (and I don’t expect any third choice to come around anytime soon).
I’m assuming us modern-day capitalists aren’t too keen on traveling down the revolutionary road. However, in a certain sense I see ‘revolution’ happening in America anytime the government steps in and shuts down someone’s ability to make money in a particular occupation or industry. We in Tax-achusetts have recently legalized marijuana. This isn’t going to put every drug dealer in the commonwealth out of business tomorrow but over time the legalization is going to cut into previously illegal profits and make the prospect of selling marijuana less attractive than it was ten years ago.
At the federal level, I think the biggest such conversation is in healthcare. If America adopted a single-payer system, it would represent the biggest revolution we’ve had since… well, since the first one that got this whole USA business started. In what other country do people earn eight figure salaries for ‘running’ companies that essentially administer payments to and from medical facilities? I suppose it would be acceptable if America was noted for being a world leader in healthcare results but such a notion is disputed at best (and in my irrelevant opinion, untrue). As I noted above, the two options for wealth distribution are taxation or revolution – we could easily overtax these same companies and their massively overcompensated ‘leaders’ or we could simply start the process of putting them out of business by introducing a government option as a direct competitor. If the end result means we all get better performance for lower cost, isn’t that better than simply increasing certain tax rates?
As I thought about how the mechanism of introducing a government competitor within a market could be thought of as a form of revolution, I thought about a comment I heard recently that defined socialism as economic democracy. I like this definition because it implicitly addresses the reality that those who lack a certain level of financial means cannot always exercise their full rights as citizens within a representative democracy. A person may miss a vote, for example, because of having to work two jobs on Election Day, or perhaps such commitments mean a person has no time to become educated about the issues and skips voting due to feeling unqualified to cast a ballot. These small failures accumulated over many election cycles erode our democracy and hurt America’s chances of reaching its full potential.
I don’t agree with every argument put forth by socialists but I do support those that enable America to better live up to its democratic ideals. The definition of economic democracy is the middle ground I need because it sets boundaries on ideas that at their extremes threaten America’s basic founding principles. Wealth redistribution and the many policy ideas that support its implementation should ensure every American has enough material means to fully participate in our democratic process and no more than that. This means one job should be enough for any American to meet the basic needs of his or her family – enough food, safe shelter, and access to healthcare primary among these basics. People should have the time to inform themselves on the issues so that every vote represents someone’s best attempt to make America a better place. No one should feel that jury duty or going to the polls – critical responsibilities for any citizen of a democracy – threatens his or her livelihood, employment, or financial security.
After we accomplish this simple yet daunting task of lifting everyone up to a basic sustenance level, I say – bring out the profit machines. Let our best try to solve problems and be rewarded handsomely for it. If everyone in the society has security and stability, I don’t see why someone shouldn’t earn nine figures for administering payments to a doctor or why a company shouldn’t squirrel away profits instead of creating new jobs. It’s when these things happen while others in the community suffer that is unacceptable. Instead of being seen as earning just rewards for hard work and accomplishment, the wealthy individuals and companies are seen as greedy – and rightfully so.
A democracy should vote its way out of such a mess before too much resentment builds up. Traditional voting is one way, of course, but I’m more intrigued by the suggestion built into an expression we’ve all heard – vote with your dollars. Yes, indeed, there is something powerful about the suggestion because market forces have done more for the common good than any other human creation. But if we want to harness market forces, we must remember to do so within the basic constraint of democracy – everyone gets their vote. Can we honestly say that a country with a 12% poverty rate gives everyone a fair vote? Is a person free to make choices, with a dollar or a ballot, when poverty allows only for considerations regarding the most basic necessities?
One thing a free market and a democracy have in common is that both systems function best when every individual is free to make informed decisions. Poverty prevents these systems from functioning at their best which means poverty is an anti-democratic disease that must be cured. If policies that accomplish this goal are labeled socialist, then so be it – to me, it’s merely a question of how to give each person the equal voice our democracy guarantees to all.
