Mr Khan said:
The key is that they balance that with a strong social safety net. Any society with any semblance of a moral compass (which also wants a market economy) is going to realize that the government needs to provide a basic level of dignity (achieved through direct provision of economic goods or a negative income tax of some sort) to all citizens, thus guaranteeing that no-one will ever truly suffer at the hands of the market. With that, you can lower barriers to entry (to an extent. Things like environmental regulations can't be toyed with) and are less reliant on things like the minimum wage to shore up the bottom, because you know that basically everyone is going to be taken care of in their time of need. Is economic equality in an absolute sense achievable? No, and it won't be until we reach a post-scarcity Star Trek kind of society. Is economic equality achievable in terms of eliminating demeaning poverty, while still ensuring a functional market? Very much so. |
Would you not say the current safety net found in the United States is not sufficient? I grew up in a family of a single mother who didn't graduate high school, with three sons. I never went without a house to live in, my medical expenses were covered (and I did have high costs when I was hit by a car at the age of ten), an education, food to eat, and even video games to play. I was successful in school, and despite my impoverished origins I attend a top-tier private university, with below-average loans because of mostly private, but also federal and state grants. My mother makes a taxable income of $11,000/ year, for the last few years without child-support, and she would recieve $3,000 - $4,000 back yearly. One must remember that the government safety net isn't the only safety net to exist, There are countless people who have helped us, just to help a friend if she would be late on her bills, or something along those lines. I've seen peers in similar socio-economic situations do the same as I have. According to the OECD, the American public social expenditure is only 15% of GDP, but the private expenditure is also 15% GDP. This makes up a total of 30% GDP, comparable to the Nordic countries, however; in these countries 28% of social expenditure is public and only a miniscule 1-2% is private. When we consider the size and diversity of the U.S compared to the Nordic countries, this is quite the impressive safety net for a federated land that isn't a nation-state.
The one thing we can learn the most from the Nordic countries, though, in my opinoin, is the reduction of the special priveleges given to the upper middle-class and upper classes in controlling certain markets. That is equality under the law. Don't regulate an industry so that the only people that can afford the risk of entry are large corporations. It's special interests like these which make an economy un-egalitarian, and that isn't the work of a free-market, but rather a controlled one.
Also with more productivity, we will experience lesser scaricity, and a lesser need for a safety net as the bottom denominator becomes much more prosperous and able to live a better life.
