Social Security, the new method of income redistribution
Get this. The problem is that globalization is being threatened, all that good could be lost. The solution; Social Security.
In the July/August issue of Foreign Affairs (published by the Council of Foreign Relations) is an article: A New Deal for Globalization by Kenneth F. Scheve is Professor of Political Science at Yale University. Matthew J. Slaughter is Professor of Economics at the Tuck School of Business at Dartmouth.
Seems some people somewhere are getting concerned that their pet project might be getting derailed.
“Advocates of engagement with the world economy are now warning of a protectionist drift in public policy. This drift is commonly blamed on narrow industry concerns or a failure to explain globalization’s benefits or the war on terrorism. These explanations miss a more basic point: U.S. policy is becoming more protectionist because the American public is becoming more protectionist, and this shift in attitudes is a result of stagnant or falling incomes.”
The authors say they don’t know why the incomes are falling, that there are no clear answers:
“Over the last several years, a striking new feature of the U.S. economy has emerged: real income growth has been extremely skewed, with relatively few high earners doing well while incomes for most workers have stagnated or, in many cases, fallen. Just what mix of forces is behind this trend is not yet clear, but regardless, the numbers are stark.”
First — “new feature”? Did they not read about the early years of the rise of the industrialists and the division in income way back when? Or is it that they as others took for granted that those making the money via globalizing their operations were going to be nice to those who worked for them at home and share the spoils via wages. Now that would have been a “new feature”. Being nice that is. I know, maybe they just thought everyone could and would outsource their own labor.
Actually, they do know about the old days:
“By some measures, inequality in the United States is greater today than at any time since the 1920s.”
What’s the solution to rising protectionism talk? Well, first what is not going to work (read carefully all you who think it’s just a matter of the populace getting off their intellectually lazy butts):
“They must also recognize that the two most commonly proposed responses — more investment in education and more trade adjustment assistance for dislocated workers — are nowhere near adequate. Significant payoffs from educational investment will take decades to be realized, and trade adjustment assistance is too small and too narrowly targeted on specific industries to have much effect.”
So, go to school, get a job is not it. Darn! The solution envelop please, (I’m so nervous):
“The best way to avert the rise in protectionism is by instituting a New Deal for globalization — one that links engagement with the world economy to a substantial redistribution of income. In the United States, that would mean adopting a fundamentally more progressive federal tax system.”
“The notion of more aggressively redistributing income may sound radical, but ensuring that most American workers are benefiting is the best way of saving globalization from a protectionist backlash.”
And they said they didn’t know why “income growth had been extremely skewed.” Well, if they didn’t know, then how is it they are channeling what was proposed before? They are even referring to it in it’s historically correct name: New Deal.
The article is very basic thinking and made me wonder why does it take 2 professors writing for 6 pages to state what I was taught under the lesson of morals: that is to share and share alike,
And then under the lesson of civics: that is social commons,
Then what I learned in history: Ford paying the help and Roosevelt’s New Deal. Why?
I think the answer is because then they could not write as if skewed income distribution is “a striking new feature” and thus suggest as an example of effecting redistribution by targeting the last remaining New Deal concept expressed in the program commonly called Social Security. They specifically rule out that other monster of a New Deal brain storm:
“This does not, however, mean making the personal income tax more progressive, as is often suggested. U.S. taxation of personal income is already quite progressive. Instead, policymakers should remember that workers do not pay only income taxes; they also pay the FICA (Federal Insurance Contributions Act) payroll tax for social insurance. This tax offers the best way to redistribute income.”
Well if that is not the ultimate bastardization of the purpose of Social Security. It’s now proposed to use it as an income redistribution machine.
Think I’m being to distrusting?
“In many ways, today’s protectionist drift is similar to the challenges faced by the architect of the original New Deal. In August 1934, President Franklin Roosevelt declared:
“Those who would measure confidence in this country in the future must look first to the average citizen. . . .”
See, they know the answer. They know exactly what they are doing here. By the way esteemed professors, stupid is not written on our foreheads.