Can Capitalism Be Made Good, Or Do We Need To Substitute Something Else Altogether?

I would like my Socialist and Communist friends to give their responses to the following writing that comes from a friend of mine, and I’m quoting from here on:

The only hardcore real workable engineering solution I’ve seen, to fixing the evils of capitalism, while keeping all the important good features, and coping with the displacement of workers created by technology, is a Basic Income. I believe adding a Basic Income to capitalism is exactly what is needed to create the Utopian future that all these people have been seeking for the past 200 years and that you are talking about as well.

People naturally learn to help and support each other. We have to be taught by some external forces, to go against our natural tendencies and learn to cheat each other. How we treat others, naturally comes back to us in how they treat us. We learn at a young age, that if we want people to be nice to us, the best way to make that happen, is to be nice to them. This pushes us all, to be nice to each other. The only way we learn otherwise, is when we are forced to live in a group where people are mean to us. We learn to be mean back, in order to survive.

Capitalism is a good tool for allocating wealth based on social contribution. But it inherently forces us to compete against each other, in order to determine our share of the communities total output. Our share of the total community output, is determined relative to how economically productive we are, RELATIVE to others in our society. But as technology amplifies the productive powers of some, it reduces the share others get, even when their effort has not diminished. They can work twice as hard as they they were, but still get a smaller share, because others have found ways, using technology, to be 1000 times more productive. The most productive, are able to s teal output away from the least productive, even though the least productive are doing their very best to try and keep up.

It’s this ability of the strong, to use capitalism to take from the poor, that makes it so evil, and destructive to our society. Everyone that has played the game of capitalism, has experienced this evil side of it first hand. Whether it was being screwed on a bad deal (what you got was not what you expected in a trade), or whether is was a failure to get a raise, where others less deserving got a raise, or a failure to be able to find a job. Everyone that has played the game of capitalism, has seen the evil side of the game – the side where people “lose” and suffer as a result.

Everyone that plays the game and “wins” comes out thinking, “that’s a fun game!”. Everyone should play it! But those that lose, understand the evil side. In today’s high tech economy, we have more losers than winners, and the trend is only getting worse. People that lose the game, tend to not want to keep playing.

We can fix the game, so that everybody wins. And the way to do that, is with a Basic Income. Everyone gets a prize, just for being willing to have this game be the foundation of our society. The Basic Income, is the prize we all get, just for willing to have this “game” be the rules by which we share the wealth of our society. Those that are able to contribute more, get a larger prize to reward their contribution. But nobody loses. Everyone is rewarded with food to eat, a place to call home, and basic health care.

When everyone wins, then the fierceness of the competition is greatly reduced. We no longer are playing for life or death. The competition itself, is no longer stressful. It becomes fun, instead of deadly.

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7 Responses to Can Capitalism Be Made Good, Or Do We Need To Substitute Something Else Altogether?

  1. Another friend responds:

    “You talk about “evils of capitalism” but do not define it. Then you say all those “evils” will be removed by giving a “basic” income to the poor and call this the only workable solution.
    First, if the problem or”evil”is not defined, how can a rational solution be found?
    Marx defined the problems of Capitalism for humanity in three volumes of Capital. I wonder how many people who are opposed to Marxism have read or understood Marx’s careful description and analysis of Capitalist economic system and its resulting cruelty to the majority of people.
    What is capitalist economic system? Are we talking about pure “free” market? A system with zero governmental interference? Are we taling about Keynsian capitalist economic theory? Classical economic theory, neoclassical economic theory, or neoliberal economic theory? Which historical period of capitalism are we talking about? Majority of writers who support capitalist economic system do not defin etheir understanding or the theory that is the basis of their argument. Again, that is irrational.
    In Economic theory analysis always begin”with everything else being equal”, then given X, Y has a certain probability of happening.
    Very often, economic analysis begins with an equilibrium state and change is measured from that state. However, in real life, that equilibrium state is mythical and never exists in real life.
    Marx provides a complete analysis of the Capitalist economic system based on historical data using theoretical tools of economic theory in the Capital.
    A brief statement can be that the only determining factor for economic behaviour by the capitalist class is gaining an increasing amount of profit( what the pro-capitalism people call it the Bottom Line).
    Here, I used the word “class”. which is one of the most important elements in a Marxist analysis of capitalism. the problem with the pro capitalist analysts is that when they talk about the gains and the”evils” of capitalist economy, they talk as if the outcome is the same for all. Marx’s analysis is based on the historical understanding of classes and their dynamic changes through that history.
    To understand Marxist solution to the”evils” of capitalist economy, one has to understand that there are two very distinct classes of people in a capitalist economy, those who own the capital( or means of production which is mainly land and its mineral resources and those who do not own those means of production.
    The distinction between these two explains the existence of extreme wealth and extreme poverty observed in Capitalist economy and is absent in Socialist economies.
    We have all observed the increase in economic inequality since the 1980’s because of the expansion of the more inhumane form of capitalism.
    So, your solution is to let this happen but guarantee some minimum income to everybody. This is not a new or workable solution. this a form of welfare policy which has been in use since the Keynesian theory which tried to rescue Capitalism from its extreme cruelty of leaving the working people in total poverty.
    However, these welfare programs are an adjustment to Capitalist economic system to calm the poor and prevent a complete revolution. Keynisian economic system was used as a result of the great depression which showed the failure of extreme “golden age” of capitalism in the roaring twenties.
    One should ask the obvious question: Why is it that during the roaring 20’s, and 80’s and 2000’s the disparity of income grows, why is it that the more successful capitalism looks to the rich, the more hard it is on the not-wealthy?
    Marx answers it and put simply: Profit is the surplus value of the product of the work of those who actual do the work( the working class). higher profits are possible with higher economic repression of the workers where by reducing wages per hours worked, achieved by increasing speed of operation and laying off of workers and piling more work on the rest, and buy allocating all gains of productivity through technology to the capitalist and none to the worker, and so on.
    So, the better off the wall street, the worse off the main street.
    That is why welfare does not work.. It is not consistent with the workings of capitalist economy. When increased poverty brings the economy to collapse( because capitalism grows based on consumption and increasing poverty eventually collapses the market), some form of welfare is produced.
    How these forces work is also dependent on the strength of the workers such as strong unions and socialist movements in the US which put pressure on the government to pass certain programs such as the Work Projects duting the depression and the passing of social security and such(which is now under attack).
    Nowadays, the repression of the workers, reduction of workforce and real wages, cutting of welfare programs such as food stamps, and … can be carried on for longer periods despite increasing poverty because we are in a global capitalist economy(not national any more) and the global capitalist class has wthe whole world atits disposal and can avoid any welfare programs because they can export the growth and make their profits elsewhere.
    Also, politically workers in the world are at a disadvantage due to the defeat of most of the socialist societies in the world, which acted both as a support for workers revolutions or demands and also acted as a possible alternative which scared the capitalists to giving in to some demands of the workers(all poor people are from working people, not capitalist class).
    That is why your solution is neither new nor workable. Poverty is the other coin of extreme wealth by the few. It is a necessity of Capitalist economy and pursuit of ever increasing profits.
    I suggest that everybody who is interested in these issues read at least the Communist Manifesto, preferably the Modern edition on its 150 year anniversary with an introduction by Eric Hobsbawm. It is very short and a good introduction and summary.

  2. Curt Welch says:

    Hi. I’m the person that wrote the first quote from above that William copied. I’m the one that said we need a Basic Income, to offset the “evils” of capitalism.

    I did not define “evils” in that short post, but I do very much understand the evils. I have not read Marx’s work, but I do understand a little about what he got right, and what he got wrong. I should read his work since it comes up so often in these debates. One day. However, one of the things he got very wrong, was his labor theory of value. But it’s totally understandable how and why he got that wrong. In his time, labor was king, and it was easy to make the error of believing that HUMAN LABOR was the key to creating all value.

    In fact, it’s not HUMAN LABOR that creates or defines value. It’s the human brain. We don’t create value, we PERCEIVE value. And it’s our perception of human value, that guides our labor to increase it. Food is not valuable because we cook it. It’s valuable because we LIKE IT. We perceive “goodness” in it. It’s our role in society as CONSUMERS that defines value, not our role in society as produces and workers. Value exists in the world, without any input of human labor. An apple on a tree has value, not becuase a it was made by human labor. Oxygen in the air, has value, not because it the value as created by human labor. Land has value, not becuase it was created by human labor.

    The entire point of an economy, is to transform the raw materials of the world, from their current state of value, into a higher state of value — as measured by human perception of value. The goal, is to transform raw materials into the form of highest value possible. All economic activity has the goal of maximizing the value of the planet for us humans. That is why we “profit maximize”. Profit is the control signal in the system that measures how much BETTER one agent is doing in the system than a competing agent in the system in the job of maximising the value of the planet. Profit maximising is not in the least evil. It’s a highly important, and very much required, part of the large optimization system we use called the capitalistic economy.

    “Profit is the surplus value of the product of the work of those who actual do the work”

    No, that’s clearly wrong. That’s the labor theory of value, and is totally wrong. The value is not a product of “those that do the work”.

    The labor theory of value is wrong, because humans are not the only agents that can “do work” in the system. All our tools, and resources, and technology, and automated machines also take part in “doing the work”. When we hit the “start” button on an automated machine that makes nails, it is not human labor that is producing the value of the end product. It’s machine labor. Humans are just machines, and as such, we are just one cog in the giant system that increases the value of our planet. Though we are quickly being displaced by automation, we still hold highly significant roles in the entire process. But that’s not going to last very long. In only a few short decades, our role as “workers” in the system will virtually be gone. But the economy will still be producing lots of value even without us. But the system only works, if we remain as the “judge” of the value — which is what we are, when we act as consumers making purchasing decisions. We define the value, by our purchasing choices. But it’s the machines, that transform the world into a state of higher value, by their actions as “workers”.

    The evil of capitalism, is in how we use capitalism, to divide up all the increased gain in value the system as aw hole is producing. That is, in how capitalism as we currently use, allocates wealth across society.

    When most the wealth was produced by human labor, we can divide up the wealth based on labor input and get a reasonable allocation of wealth. What people take out, is a function of what hey put in. The raw materials played a smaller role, and as such, payment received for owning resources, like land, was relatively small and equality stayed in balance.

    But as our technology advanced, the role all the man made machines, and tools, played in the production of value, increased. And though our system of private property, whoever managed to gain ownership rights of these things, got to use them as “slaves” and keep the wealth produced as their own, even if the person did no labor at all. Owning, instead of “working” became increasingly important as our technology advanced. Which is why “owning the means of production” was such a big part of Marx’s work.

    There are two aspect of “ownership”. One, is that the owner is assigned the duty/right, to manage the property. That is, to decide how it is to be used to produce value (or not used). We need all these resources to be managed for the economy to function, so we supported the nation of private property because it resolved the question of who was assigned to manage the resources. But the other aspect of private property ownership laws, is that the owner is also given full rights to hoard, all value created by the management of the property. This is where the evil enters the picture.

    Land is a “God Given” gift. It is not something created by man. We can morally argue that all of us in our society, should have equal rights to a share of the wealth produced by these “gifts”. But yet, we agree, in our society, to support private property ownership rights where we give up our right to the wealth of the land, and let someone else have it. That’s not a fair trade. The person that manages the land “for us”, should be rewarded. But there’s no reason to suggest he should be rewarded to obscene levels.

    It’s the taken advantage of our private property ownership laws, that allows for the creation of all this inequality in society. And the reason inequality keeps growing, is because our technology keeps advancing. The more our technologies advance, the greater the level of inequality, the private property laws create in society. We offset this evil, with many different forms of socialism. Every one of them, takes from the rich property owners, and give to the poor non-property owners, in one way or another. When inequality grew too large in the 20’s it crashed the economy, led to war over resources, and we restored order by adding socialist redistribution of wealth, from the rich to the poor. We made the rich, share more of the wealth produced by the things they owned. We greatly reduced inequality, and by the 60’s, the economy was working very well. But technology kept advancing, which meant inequality returned. Those that owned the wealth of the technology, grew wealthier again.

    To offset the inequality created by the technology, we needed to add more socialistic sharing of the wealth. But come the 80’s, the rich got tired of “sharing” and talked the stupid poor into the idea of “trickle down” wealth. The sold the story that if the owners of society society were allowed to keep more, it would help the poor more, than if the owners had to share with the poor. Stupid story. But the US bought into it. We reduced sharing programs, and the rich got richer and the poor didn’t get anything.

    Technology, combined with private property laws, gives the “owners” of the world an economic advantage over the “workers” (who only own their own body). Without fixing it, it leads to a society of a small rich and powerful elite with their boot on the necks of the poor. But fixing it is easy, we just again, force the owners of the world, who have been given their power to monopolize the ownership of private resources and technology, through the guns of our police and military, to share more of the wealth being produced not by their “labor” but by what they own.

    That is what a Basic Income is. It’s a socialistic sharing of some of the wealth, being produced by private property. We tax all wealth being produced in the economy, because it’s far too impractical to try and figure out how much is produced by what and who, so we just use a flat tax and tax all the wealth that is produced, taking a slice of it all across the economy, like 20%, and then dividing that 20% slice up, across all the people of the society evenly. This offsets the evil of capitalism created by private property laws. It’s the dividend, every citizen gets, has his share, of the output of the total society. His share, of the output, that has all been created using the natural resources of the nation, or the planet, which each of us, have a partial claim to.

    If someone makes 1 million on the oil well they own, and we tax 20% of that, for a Basic Income, all we are doing, is saying that 20% of the wealth produce by that natural resource in effect, belongs to all of us. If someone makes a million for the factory he owns, we are just saying that 20% of the wealth produced by the factory, made 100% from the natural resources of the planet is “public” property and must be shared with all the citizens of the society that are willing to honor the private property laws.

    Or, I’ll yet “you” have total ownership rights of that land, and use it to make a profit, IF, you are willing to pay the people of the world a 20% cut from whatever you make. A Basic Income, is a deal that works like that for “all” private property in the economy.

    As we transform from an economy based on human labor, to an economy based on machine labor (a transformation we are already well in the middle of), this sharing of wealth produced by the natural resources will be REQUIRED in order to sustain our society.

    The evil of capitalism based on private ownership of all resources, is inequality. And the fix to inequality, is to take from the rich, and give to the poor. Force the owners to share. The clean way to implement that forced redistribution, is tax everyone based on total income (tax business income — aka profits — as well), and then redistribute the tax revenue evenly to all members of society. We add as much socialism as needed, to offset the evils of private ownership capitalism.

  3. Another quote from Curt Welch:

    There will always be jobs available. No matter how advanced the machines get, the economy can always make use of all resources available — which means it will always be able to find work for humans to do. But there’s no economic law, that says the wages for the job, will be large enough to buy food to feed the workers. That’s what actually happens as machines replace us. Jobs for humans never really go away. People just get forced into lower paying work. The wages just keep getting lower and lower until we reach the point that no matter how hard people work, they can’t make enough to feed themselves, let alone a few kids.

    With minimum wage laws added however, the jobs do actually go away. Once the companies have machines to do the work, that cost less then hiring a human at minimum wage, the job actually goes away totally.

    How many horses do we have working in the economy today? If you owned a horse, could you lease it out and make money on it? That is, would you find enough work to least it out for, that would produce enough income to pay for the horse, and still make a profit? How many working horses are left as part of the economy today compared to 150 years ago? Not a lot. They have been obsoleted from the economy because they were mostly replaced by machines. Humans still have jobs, because we have a better brain than a horse. But soon, computers will be better than a human brain in all respects, not just in doing accounting, or playing chess, or Jeopardy, like they are today, but in all things we humans currently do with our brains in business.

    Kurzweil puts the date at 2045 when we have cheap machines (like $1K range) that are more powerful than humans. At that point, a cheap $1,000 computer can replace any job, currently done by a human. Any job. From cab driving, to construction, to CEOs, to President of the US, to Mozart. Imaging, what a $100K computer will do in 2045. It might be able to control 100 construction robots all at the same time doing 100 different tasks all in perfect unison and coordination as if it were one mind controlling a beast with 200 legs and 200 arms and 200 eyes.

    It’s highly possible that 10 years before that, in 2035, we will have expensive machines that can replace any single human that cost $100K. Even at $100K, this is hard for a human to compete against price wise (depending on energy costs to run it). Within only 20 years, it’s potentially possible, we will have the technology to replace humans from every job and only cost will be holding us back.

    The new machines won’t need to be programmed. I’m talking about machines that act and work like humans. That is, we train them, in the same we train humans, by sending them to school. Not by writing billions of lines of code. But unlike humans, once we train one of them, we just copy the programming to 1000 others, and then they all instantly know whatever the first one was trained to do. That gives them a huge cost advantage over humans, so even if they cost $1 million each, they will be highly disruptive to humans being able to find work at a living wage.

    And there’s a chance, this estimate is 10 years too long, and it will all happens 10 years sooner than that.

    Google in the past year has been making big investments in AI and into robotics. They have hired a lot of the top talent in the world to do AI and robotics work. Facebook just hired a top guy to head up their AI work. This stuff is for real, and it’s coming fast and it’s going to be highly disruptive to the human job market.

    The only people making money, will be those that have lots of money to invest in all the machines that will be doing all the work for us.

    Unquote Curt Welch.

    And someone replied, “That soon?! How are our kids going to survive? Unless someone is bright enough to get us off this economic drive-to-oblivion, we’re not even going to have a chance to live in a Blade Runner-esque world!”

    And Curt replied:

    Well, the kids will do just fine becuase the closer we get to the day of machines replacing humans the more obvious it will become to everyone that what people have been saying about the end of jobs for the past 100 years is actually true. It’s already driving inequality to insane new levels but most people still believe that the inequality is either good for society, or bad, but caused by other things, like bad public policy or a corrupt government that has been taken over by big money interests. The greater the inequality rises, the more people will realize there’s something larger and more fundamental at work, and in the end, they will vote to support a Basic Income. And once they do that, all these problems will be fixed and society will work just fine again and we will quickly move into the new machine age where people have far greater levels of freedom than they have every had in the past.

    The bottom line is that people don’t yet actually believe that humans will be replaced by machines anytime soon. They think we have magic powers that are of reach of our machines will be able to do for another 500 years if ever. But once we have these machines, which we will soon, they will understand what we are are up against. Most people just need to see it for themselves before they will believe it.

    ~~~~~~~~

    Replying to someone else’s reply, Curt goes on:

    “people will not just be standing by while this increasing automation occurs”

    Well, expect it’s already happening and people ARE just standing by and acting like nothing is happening! In fact, if you point it out to people, they argue against you saying it’s not happening! It’s been slowly happening, and slowly accelerating for a few hundred years, and people just keep re-acclimating to the new standards of life without ever really noticing how much things have changed.

    The thing that keeps everyone from gasping how close we are to the end game is that so far, no matter how “smart” the machines are, none of them seem to act like a human acts. Humans still have a unique (life like) way of acting that is so different from our current machines, that people are left with this false sense of superiority. We don’t even have robots that act like dogs, cats, or mice yet! So people think robots that act like humans must be a long way off, like 100’s of years still. They are going to be be totally caught off guard. But when they see robots acting like real dogs, or other life-like animals, then they will start to catch on that making them act like a human is really not as far off as they suspected.

    “Profit is not the only thing that matters to people. Humans will be very involved in directing and controlling this evolution. ”

    Which is exactly why I argue for a Basic Income Guarantee. The point of profit (and capitalism in general) is to maximize the allocation of resources so they will do the most good for the consumers. But we don’t just care about maximizing profit, most of us care about seeing that all the people of the world are being cared for. So we can use capitalism to allocate and share all of earth’s through profit maximising, but we use a Basic Income Guarantee to make sure that all humans are allowed to be consumers at some minimum guaranteed level.

    But, people have a hard time understanding how important this is, exactly because they don’t grasp how much displacement and inequality has already been created by automation, nor do they grasp how amazing close we are to being massively displaced.

    Once we have machines that are actually acting like living animals, I think people will start to catch up to the fact that things are changing.

    Have you seen the videos of the Boston Dynamics “Big Dog” pack mule robot? Here’s one:

    Right at the beginning where the robot is kicked by the person, at :35 the way it recovers is amazingly life-live. That’s just a tiny taste of what’s coming. The rest of its behavior however is fairly robotic . . . .

  4. Curt Welch said (in response to someone):

    Basic Income is certainly not communism. It’s a form of socialism, as is all our welfare state. It’s far less communistic than our current welfare systems.

    In fact I don’t know the details of how the Soviet Union structured their society. But classic communism is created by eliminating money and free trade totally. Central committees do all the planing in society to replace Adam Smith’s highly intelligent invisible hand of free trade. They decide what businesses need to be created, and what factories to be built. All the means of production is owned and controlled by state run committees. The committee’s control and set production levels. People are told by the committees where and when to work. Goods and services are then handed out by the committee. People are assigned government housing to live in and are allocated a share of the food and clothing. If they are lucky, they will be allocated a car. Communism works very well actually in many ways. Many people were very content living on a system where other people were responsible for planing your life, and where there was a society that had fairly large levels of equality. But what it fails to do, is be efficient. The system does a very poor job, of meeting the needs and desires of the people. The people have very little input into the system. They can put in requests, such as for a car, or where they want to live, or work, but the committee is very slow to decide such things and there are always long waiting lists for everything. If the committee tells you to work you have no option to say no. You have to at least show up at the factory and spend your day there. You lose your day, even if you only “pretend” to do your job.

    With a Basic Income, there is no central planing. There is no central committee telling people what to do. All allocation of goods and services is controlled by pure capitalistic free trade. The government owns nothing. The means of production is all privately owned and controlled. The invisible hand of Adam Smith optimizes the allocation of all resources to provide the best possible goods and services to the people. People are free to decide for themselves what type of work to do and whether to work for others, or only work for themselves.

    A Basic Income is not a replacement of income for working. It’s just an allowance that everyone gets for “free” that caps the poverty level of country. Idelay, it’s enough to exist on, and pay basic food and housing and health care, but it would never be enough to “live” on. People will always want more in some form.

    A basic income is conceptually nothing new in society. We already do massive amounts of it. A child, that is fed and clothed by their parents, and given money to spend as an allowance, is living on a “Basic Income” from their family. A college grad living at home, on the health care policy of their parents, or getting a free meal from their parents from time to time, is still getting a Basic Income from their family. The grandmother, that has moved in to their child’s home, and is getting free rent and food and elderly care from her children, are getting the same thing as a Basic Income, from their kids.

    All our current government welfare systems are already a type of Basic Income. Social security and medicare is a Basic Income that kicks in when you are 65. In concept, we each pay in during our life, and get money back at retirement. But in fact, it’s not that way. More accurately we pay insurance premiums throughout our life, for a retirement income guarantee, and at 65 we collect our insurance. If we die early, we get nothing back, and our money goes to pay for other people. If we live to be 100, we get out more than we paid in, and other people are paying for our income.

    A Basic Income at the level of entire society, is nothing different in basic concept, than what we already do inside our own families and with our welfare programs. It’s the larger family of “All Americans” taking care of each other by those with the most, helping out those with the least.

    It works much the same as social security, except it’s social security for our entire life, not just for our retirement. When people are young and just starting out in life, they will get more out of the system with their Basic Income checks than they pay in with taxes. But in their prime work years, the taxes will be higher, than the Basic Income check they are getting back, so they will be contributing to the system. Then again, in retirement, when their income drops, they will be taking out more than they will be putting in. So we are paid in our childhood, for what we will be able to contribute later in life.

    If we lose our job, we have the basic income still to reduce the financial blow of losing the job. This is not much different than how government unemployment insurance works. Except with unemployment insurance, you get a lot more money, for a short period (closer to what you work wages) but it lasts only a short period of time and is gone. Basic Income is small, but never stops. It’s always there to protect people from disaster.

    Basic Income is just unconditional welfare. Our current welfare is all conditional. Our current welfare is communistic. It’s all controlled by a central committee that must approve what you are allowed to have and not have. You have to be old enough, to get social security or medicare. You have to be sick enough to get disability payments. You have to be poor enough to get food stamps, or medicade, and you can only use food stamps, for the things the central committee approves. You have to lose your job, to get unemployment benefits. You have to have the right number of kids, and a low enough income to get welfare. There are 1000’s of programs, and every one of them have 100 conditions defined by the central committee to determine who can get it and how can’t.

    A Basic Income, is welfare without the the communist central committee approving everything. A Basic Income is far less communistic than our current welfare state. There are no conditions on who gets the welfare. Everyone gets it, and everyone gets the same amount. The state has no ability to tell you what to do with your welfare benefits. You can buy food, housing, healthcare, or give it away. This means we pay a lot of people welfare that don’t need it, but that is just offset by the taxes they pay. With a Basic Income, everyone is taken care of. No one falls through the cracks or is neglected. No one has to stand in long lines at a welfare office, beg a government worker for help, and be rejected because the low wage government worker tells them they don’t qualify to be helped.

    A Basic Income is free market welfare.

  5. Curt Welch said (in response to someone’s comment or question):

    [T]he idea of a Basic Income is not to give everyone a living wage for “free”. It’s to give everyone poverty assistance for free. The median household income in the US is $50K. A Basic Income for the US that was around 20% of GDP would provide around $20K per household on average or around $10K per adult per year. $10K is not a “free living wage”. It’s the same as around $5 an hour “free” living wage except you get it whether you are able to work or not.

    When everyone in the nation gets the same Basic Income, anyone that has no income other than their Basic Income, are the poorest members of society – the very bottom of the social class structure. They are the people in “poverty” relative to everyone else in society. They are the social losers. The homeless bums living on the street have the same income, as someone that only lives off their Basic Income. Few people will choose, to do nothing other with their life, than hang out at McDonald’s and eat burgers paid for by the Basic Income. The point of the Basic Income is that it frees people to build any life they choose to build for themselves. Most will choose to do things that are highly constructive, whether that’s traditional paid work, or raising a family, of improving their education, of doing non-paid volunteer work, or being a social activist and trying to raise awareness of a social issue, like Inequality. A Basic Income frees people to follow their dreams, and very few people dream of sitting on a couch and doing nothing with their life.

    Instead of increasing the minimum wage from $8 to $10, we should create a Basic Income equal to $2 an hour for every person ($4K a year) and leave the minimum wage as it is. This helps not only those that are working, but those that are unable to work. It helps the retired, and those at home taking care of the family. It helps everyone in school trying to improve their education. It helps the unemployed who are looking for work. It helps the disabled, and and the sick. It’s helps the people who have been rejected by society, feel somebody actually cares about them. It helps everyone in society who needs financial help.

    A Basic Income is welfare done correctly. We should start a Basic Income now, even if it’s small, instead of expanding other welfare programs like minimum wage. We should increase the size of the Basic Income over the years, and reduce how much we increase other programs, like social security, for inflation. We should cut back, and eliminate other welfare programs, as we expand the Basic Income.

    [My position is that Minimum Wage should be abolished. — William Waugh]

  6. In response to a question “Should the US Copy Switzerland and Consider a ‘Maximum Wage’ Ratio?”, Curt Welch responded:

    Micro fixes to macro problems always creates more problems that it fixes. Companies will find ways to compensate CEOs that skirt the laws.

    Overall social inequality is the macro economic problem that must be fixed, not just CEO salaries.

    The correct way to address overall inequality, is with the other approach the Swiss will soon be voting on, which is a Basic Income for all citizens. That is the correct macro solution to the macro problem of inequality. That will fix CEO income relative to the average worker income, as well as all other forms of inequality, The US needs this far more than the Swiss do. Our inequality is far higher, and the social problems created by inequality are far worse in the US.

    There’s a petition at whitehouse.gov in need of more signatures to bring this problem to the atention of the American People. Please check it out and consider signing it.

    Petition: Establish a basic income guarantee for all Americans, similar to what is being proposed in Switzerland. https://petitions.whitehouse.gov/petition/establish-basic-income-guarantee-all-americans-similar-what-being-proposed-switzerland/jFbgDZ4h

  7. Curt linked to a writing that says, “Overcoming poverty is not a task of charity; it is an act of justice. Like slavery and apartheid, poverty is not natural. It is man-made and can be overcome and eradicated by the actions of human beings.” Attributed to Mandela.

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