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From a great interview on Alter.net –
“LP: Some say that if we redistribute income in a more equitable way, people won’t want to work as hard. Is that true? What happens to our motivation to work when things are so inequitable?
JS: One of the myths that I try to destroy is the myth that if we do anything about inequality it will weaken our economy. And that’s why the title of my book is The Price of Inequality. What I argue is that if we did attack these sources of inequality, we would actually have a stronger economy. We’re paying a high price for this inequality. Now, one of the mischaracterizations of those of us who want a more equal or fairer society, is that we’re in favor of total equality, and that would mean that there would be no incentives. That’s not the issue. The question is whether we could ameliorate some of the inequality — reduce some of the inequality by, for instance, curtailing monopoly power, curtailing predatory lending, curtailing abusive credit card practices, curtailing the abuses of CEO pay. All of those kinds of things, what I generically call “rent seeking,” are things that distort and destroy our economy.
So in fact, part of the problem of low taxes at the top is that since so much of the income at the very top is a result of rent seeking, when we lower the taxes, we’re effectively lowering the taxes on rent seeking, and we’re encouraging rent-seeking activities. When we have special provisions for capital gains that allow speculations to be taxed at a lower rate than people who work for a living, we encourage speculation. So that if you look at the design bit of our tax structure, it does create incentives for doing the wrong thing.”
The burgeoning inequality in the US is rotting civil society away, the sooner the US decides to address the issue the better.
We’re missing yet another capitalist experiment go bad. Chile self-destructed earlier under the watchful eye of the IMF and its neo-liberal reforms. Mexico, geographically, is much closer to us and you would think that its slide into anarchy would garner a little more attention in our news media.
Nah.
The breakdown of Mexican civilized society continues unabashedly while the important powers that be continue to make their money. The unravelling of the social fabric of Mexican society is chilling reminder of lawlessness actually is.
The North American Free Investor Agreement (NAFTA) was the harbinger of the demise of Mexican society. Austerity and cost-cutting denied the government the funds necessary to do what governments are supposed to do, serve and protect their people. Not industry, not finance, not capital – the people of Mexico. The inequality and insecurity are so entrenched, the people so desperate, people will do anything to survive. Morality, ethics all go down the shitter when you struggling just to survive the day. Consider the police situation:
Watch closely and you can see our future written in the blood of the poor of Mexico. We mourn for them, yet fail to see the precursors (neo-liberal reforms, etc.) that are shredding the social fabric of our societies.
The writers at Alter.net have been on a tear as of a late. I reproduce highlights from the article.
The Top Five
Here are five “conventional wisdom” doses of economic nonsense that we have been fed:
1. Business does everything better than government.
Corporate conservatives argue that businesses and their one-dollar-one-vote system of decision-making is better and more efficient than We, the People’s government and its one-person-one-vote system. They argue that constant competition, placing companies under constant fear of going under and people under constant fear of job-loss, focuses the mind like a pending execution. They say it leads them to do only what they should be doing and no more, in the best possible way, always looking for the best and most “efficient” ways, forcing innovation to occur.
But as we have seen, what actually happens in this kind of dehumanized “Force You” system (as in “F.U.”) is that businesses are forced to cut every corner, cheapen every product, cut out every service, lay people off, cut people’s wages while adding hours, gut benefits … and probably go under anyway because when every business does the same 99 percent of us can’t afford to buy or do things anymore.
The effect on people (human beings – remember them?) is worse. Stress-induced illness is rampant in our fear-based society. People do not get sufficient sleep, skip vacations, work long hours, spend less time with their families, spend very little time in nature, and the rest of the things that make us human.
This idea that people are best when operating under constant fear is similar to the conservative mantra that everyone should carry a gun because then you have “a polite society.” Perhaps constant fear and stress keeps people on their toes and makes them “behave” but in the long run it’s just no way to live.
Another “feature” of this top-down, one-dollar-one-vote, “market” system that the corporate conservatives advocate is that only those at the top levels of the corporate/financial ladder make the decisions for, and receive the benefits of, society. This is great if – and only if – you are in that 1 percent. But one-person-one-vote, democratic government decision-making means all of us have an equal say with equal access and equal opportunity, and society operates for the benefit of all of us.
2. Rich people are “job creators.”
This is the old “trickle-down” idea — that if you give enough money to the already-rich eventually some of that money will trickle down to the rest of us. This is also called the “getting peed on” theory of economics.
The basis of this thinking comes from the theories of Ayn Rand, who argued that society consists of “producers” and “parasites.” Rand’s fundamentally anti-democratic ideology says that democracy is a form of “collectivism” in which people who don’t want to work and produce use their numbers to steal from a gifted few who are the “producers” of goods and services. Rand’s followers claim that wealthy people are rich because they “produce.” The rest of us are “parasites” who “take money” from the productive rich, by taxing them. This revenue is “redistributed” to the parasites to pay for our “entitlements.”
They say that if wealthy people have more money they will use that money to start businesses and hire people. But anyone with a real business will tell you that people coming in the door and buying things is what creates jobs. In a real economy, people wanting to buy things – demand – is what causes businesses to form and people to be hired.
History – and a quick look around us today – shows that when all the money goes to a few at the top demand from the rest of us dries up and everything breaks down. Taxing the people at the top and reinvesting the money into the democratic society is fundamental to keeping things going.
3. Government and taxes take money out of the economy.
I just keep posting about gender inequality, others say pfffff! what the heck I am talking about….
Until the idea that inequality exists and that it is a problem,then there really is not much to discuss now, is there?
Alberta is facing many challenges as the next boom approaches. It is more than likely that bounty of this boom will once again only benefit the rich and the larger corporations while yet again the people of Alberta must take a few of the crumbs that slip off the head table. The last part of the Parkland Institute report deals with what we can do make Alberta a better province for everyone, not just certain classes of society.
“1 STRENGTHENING COMMUNITY SERVICES:
Shift away from a business approach to one based on core service delivery and away from reliance on generosity and charity to one based on rights.
Recommendation 1: Develop a more inclusive and supportive attitude toward community service providers including:
• increased funding that is stable and longer-term;
• funding for staffing compensation equal to comparable direct public sector programs;
• accountability that is based on appropriate and manageable indicators and data collection; and
• funding and support to expand on community hub models for community-based service grouping and delivery.”
Accountable and based on data rather than whims of the rich? Novel idea.
“2 A BETTER QUALITY OF LIFE FOR ALL ALBERTANS:
Improve access to quality social programs, increasing leisure time and reducing stress on families.
Recommendation 2: Provide greater support to improve the quality of life for all Albertans including: increased spending and program expansion related to culture and leisure, childcare and early learning, education, health care; and reduce working hours through shorter work weeks and increased vacation. Key recommendations include:
• expand community based public health services for Aboriginal communities and implement no child left behind policy;
• fully fund and deliver early learning programs based on the public school model (including junior and full-day kindergarten);
• fund universities to reduce tuition rates to $1,000 per year across all programs;
• increase paid leaves and reducing work hours to match European averages; and
• create adequate publicly funded, non-profit child care spaces at $7 per day.”
Will it be expensive to implement? Oh yes, but no more expensive that paying for the results of our current societal choices in terms of health care, police and prisons.
“3 INVESTING IN HOUSING AFFORDABILITY
Recommendation 3: Fulfill promise to eradicate homelessness by 2019 by complying with commitment of $3.3 billion in spending and building the necessary 8,000 new housing units.”
Are we just 8,000 units of affordable housing away in Alberta from making it a reality that no person needs to die of exposure during the winter? Instead of squabbling over powerlines and utility deregulation(still a bad idea) why isn’t this at the top of the political agenda?
“4 ENSURING DIGNITY AND AN ADEQUATE INCOME FOR THE MOST VULNERABLE
Recommendation 4: Strengthen the province’s social safety net through the development of programs that are universal, accessible and delivered in a non-stigmatizing manner. This includes:
• phase in a livable guaranteed annual income (GAI) to bring together programs for seniors, people with disabilities, unemployed workers, students and low income workers; and
• while working towards the GAI, social assistance rates need to be increased to the poverty line, rates must be indexed to inflation, asset levels increased, application process simplified, eligibility expanded and wait time shortened.”
Whot? Free handouts for the lazy?? How dare they? There will always be people who unfairly profit at societies expense, we stigmatize the poor because the rich do not want us to closely examine their privileged state and the dodges they are currently employing to game the system in their favour. Better to hit the poor hard and then cry for more police and prisons to warehouse the poor, all the while neglecting the conditions responsible for a good portion of the criminality.
5 PROTECTING WORKERS:
Improve income security, equality and quality of life through expanded worker protections.
“Recommendation 5: Provide more comprehensive protection and assistance to those working full-time, full-year to ensure an adequate standard of living. This includes:
• implement a living wage policy;
• strengthen labour protections including both employment standards and labour organizing procedures; and
• abandon the temporary foreign worker program, and expedite and better support foreign credential recognition.
Nothing radical here, just making working conditions adequate for all Albertans, not just those lucky enough to be part of a union.
“6 DEMOCRACY AND GOOD GOVERNANCE
Recommendation 6: Reform the democratic process to ensure that it accurately represents Alberta’s population diversity and distribution. This includes:
• adopt a proportional representation electoral system;
• establish an independent body with representation from Aboriginal, newcomers and women’s groups;
• implement an accountability and reporting system based on well-being indices; and
• work with Aboriginal groups to increase funding for and expand a comprehensive, community-based, culturally appropriate policy agenda with targets for improving quality of life and reducing disparities.”
PR would be a breath of fresh air in the stagnant backwater that is Alberta politics. Proof? The PC have been in power for longer than I have been alive, it really is time for a change.
“7 PROGRESSIVE REVENUE REFORM
Recommendation 7: Re-establish the link between taxes and public services. Revenues should be returned to levels that allow continued support commensurate with changing demographics and inflation for public goods like health care, education, and social programs that Albertans feel are citizenship rights. This includes:
• reinstate progressive taxes, with increased progressivity at the top end and brackets indexed to inflation;
• raise corporate taxes to the Canadian average;
• reinstate the liquor tax;
• remove gambling revenues from general revenues and instead adequately fund arts and culture, communities and early learning from progressive taxes; and
• collect all natural resource rents and keep them out of general revenues for use in building a future for the province.”
The first sentence is the most important – “Re-establish the link between taxes and public services.” This linkage needs to be reestablished so people can see the results of their taxes working for them making their lives better. The current decline in the standards of living in Alberta can be traced back to when this link was broken and we have been picking up the pieces ever since.
“Alberta is at a crossroad. This report has highlighted what it means to have economic growth at the expense of social cohesion. With over 80 per cent of incomes concentrated in only half of households and the lowest ranking in the nation for sense of belonging to their communities, Alberta needs a new policy framework. This report provides the framework for a new development path; one where economic growth serves social goals and where disparity is minimized, ensuring an adequate income, quality of life and dignity for all Albertans.”
Could not say it better myself. :)
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