(04-05-2016 02:21 PM)bearcatmark Wrote: In a realist's mind, companies exist to make profit and union's exist to protect employees from exploitation in the company's pursuit of profit. The global economy and ability to find worker's who aren't unionized who will work for tiny wages has eroded the bargaining power of unions and made it much harder for low skilled laborers to make a living at the level they once were able to. You want a major reason Trump and Bernie do so well these days...it's income concentration in the top 1% and that inability for low skilled labor to make the kind of living. We've never found a modern economic answer to bringing up the middle class since unions have faded from society.
I support labor--unionized or not--in its role of protecting employees from exploitation. But modern unions do very little of that, and government employee unions do virtually none. Where I have problems with unions is that they seem to exist far too much to exercise political clout that inures to the power and benefit of the union leadership instead of the workers. I like the German model, where workers elect a certain number of members to the corporate board of directors. This means that the board effectively represents three classes of stakeholders--management, investors, and labor. I think this is the proper level at which the interests of labor should be recognized. Who doesn't like this model? Well, when it was proposed here in the 1970s the opposition came from union leaders--who saw the inevitable conflict of interest rules as potentially limiting their political clout.
The constant attack on the 1% is nothing but preying on the greed and envy of people. There are two ways to make income and wealth dispersion more equal--make the rich poorer or make the poor richer. Making the poor richer is better, but harder; making the rich poorer gives easy sound bytes. And politicians like easy sound bytes.
My approach would be a guaranteed minimum income based on Milton Friedman's negative income tax or the Boortz/Linder prebate/prefund, coupled with French Bismarck health care, paid for primarily by elimination of costs associated with eh current means-tested welfare system and secondarily by a consumption tax.
This "global economy and workers who will work for tiny wages" sound byte misses a very large point. Most of the jobs we are losing are not going to workers who will work for tiny wages. Some do, no doubt about that, but every time somebody builds a new factory in Europe or Japan, that's jobs that could be here but are there instead, and those jobs way outnumber the people sewing up Nikes in Thailand and such. We can't compete with the third world for menial jobs. But there's a strong argument that we don't want to. Those wouldn't be great jobs if they were here. Germany can't compete with China for those jobs either, but Germany doesn't try. They do the things that they can do better than China, and they do very well with that approach (unless they end up having to carry all of Europe on their backs). Instead of trying to bring back the jobs paying $2/day in China, why not be the location of choice for the jobs that are paying $30, $40, or $50 an hour in Europe? That requires better education and better infrastructure to improve productivity, world-competitive tax rates, probably a consumption tax, and streamlining regulations by keeping those with substantive effect (clean air, clean water, safer workplaces) and getting rid of those that offer more procedural hassle than substantive benefit.
Companies locate economic activity and therefore jobs overseas to get lower costs, lower taxes, and less intrusive regulations. The way to bring them back is not higher costs, higher taxes, and more intrusive regulations.
(04-05-2016 02:26 PM)bearcatmark Wrote: BTW the answer some countries have found are (1) strong social, government paid for safety invested in by the US Taxpayer (Bernie is advocating this and this is something you see in Scandinavian style welfare state democracies), (2) some countries have stronger minimum wage protections and other worker guarantees (paid family leave, vacation), (3) some countries cap CEO salaries to X percentage of employee salaries, (4) some countries engage in more protectionist policies to protect the value of their workers (taxing imports to a high degree, tariffs...seems Trump has been advocating something akin to this). I have a few thoughts on the answer ways to make things better in this regard, but I do think people have undervalued what the global economy has meant to quality of life in terms of access to technologies and things that make life easier and better that didn't exist or wouldn't exist cheaply without them.
I added reference numbers to your post in order to respond to specific items below.
(1) Actually, Bernie has been pressed several times about whether he supports a guaranteed minimum income, and he has refused to go there. He's still way more about making the rich poorer than about making the poor richer. And the rich don't want to get poorer, so I predict that if Bernie tries, we're going to hear Ross Perot's giant sucking sound as jobs leave the country. Maybe he will put an end to inversion, but that not the only trick in their bag. Bottom line, Bernie is about redistribution, the Scandinavian systems are about a safety net. There are significant differences between the two approaches (Scandinavia taxes corporate profits at about half the rate we do, and their top individual tax rates are actually less than Bernie is proposing, for a couple of examples). What happens in Scandinavia, and pretty much all of Europe for that matter, is that the middle class pays a lot more, and that is offset because they get the same benefits as only the poor (or those who can lie about it) get here.
(2) If you have the guaranteed minimum income, then you don't need a higher minimum wage. With my approach, a full time job at the current minimum wage puts every individual and family in the US above the poverty line. That means that employers can pay people what they are worth in terms of productivity, while at the same time those employees are receiving a living income.
(3) If you put in a hard cap, you will drive those CEOs offshore to jurisdictions without such limits. There are plenty of them, and while some of them are not desirable places to live, some of them are pretty decent. What I would do is to put in some multiple and require that any compensation above that be in forms that do not vest immediately. Putting a 5 year vesting requirement on stock bonuses and such compensation would force CEOs to make good long-term decisions instead of gaming the system short term.
(4) What every other developed country does that we don't is to have a national consumption tax. See Table 2-1 at
http://www.oecd.org/tax/tax-policy/tax-d...VATTables. They get to charge this on all imports when they are landed, and rebate it on all exports when shipped. It doesn't count as a tariff under international law, so free trade treaties don't impact it. This is one place where leveling the playing field would greatly improve our balance of trade, and in the process we would inevitably be making and exporting things that we now import, and that would create a huge demand for more middle class jobs. No, this won't close the gap much with China or the undeveloped world. But it would make a huge difference with Europe, and we import about half as much from Europe, net, as we do from China. Turn that from a negative to a positive of equal magnitude, and that change would pretty much offset China. Then we are down to oil driving our trade deficit, and we can do things there, too.
