Saving Our Way to Strength

Being thrifty with our money has much to recommend it, but we cannot build national strength by failing to spend money where it is needed. Unfortunately, many Republicans and Libertarians fail to see this, and it has caused a great deal of difficulty. They believe that “The best government is that which governs least”. Catchy, but it would institute poverty and continually aging infrastructure.

Infrastructure has already decayed badly, but what Republicans really want to do is to rid the country of Social Security, Medicare, food assistance, and everything else that’s “unnecessary”. In spite of all evidence to the contrary, they believe that poor people have no one but themselves to blame for not being rich. Dumping all this “nanny state” stuff would at last force them to stand on their own two feet and get to work. A Republican governor said this using almost these exact words this week.

How anyone can believe this crap is quite beyond my comprehension. The argument can be demolished with two observations: (1) Worsening inequality creates more and deeper poverty, which would mean that laziness waxes and wanes; (2) Our record inequality is demonstrably the result of political policies that favor the rich, which would mean that laziness rises with gifts to the rich. These two observable truths negate their entire belief. The two cannot logically coexist.

Ongoing gifts to the rich have left huge chunks of the nation’s wealth in the portfolios of a handful of self-interested multi-billionaires. A few decades ago we stopped being a democracy and instead became a plutocracy when the wealthy gained enough power to control Congress. If this worsening inequality does not reverse course we will in time be in danger of a genuine armed revolution, because we are beginning to look more like pre-revolution France and less like post-revolution America.

This Republican belief that we can starve ourselves to greatness has been proven wrong so many times, so many ways that one wearies of thinking about it. No matter how many times St. Reagan expressed it, money doesn’t “trickle down” when the rich get tax breaks and other goodies of their own choosing. Money bubbles up from the bottom, starting with the poorest.

These government programs Republicans love to hate are the kinds of things that make the more advanced countries of Europe and Asia better places to live than the US. The reason is simple: a base of everyone in the country makes social plans as efficient as they can possibly be. Our private health care plan is dependent on insurance paperwork that takes one of every three dollars and provides absolutely no health care. This is why national plan medical procedures cost half what ours do, as do their medicines. We see too that national bureaus elsewhere are able to control prices, rather than Congress forbidding it.

Then there is the matter of infrastructure, meaning all the physical structures that allow the smooth functioning of the nation.

I live in San Francisco, and I’m very proud of the way the city spends money. For example, a few years ago it became apparent that the city’s sewage infrastructure was aged, some of it a century old. The issue was put to the voters, who voted solidly to begin upgrading, at great expense. Many of our cities experience frequent burst water mains and the like because they haven’t spent the money to modernize. Each failed pipe costs a lot to fix, and fixing it only delays the inevitable cost of replacing the entire system.

It’s like spending on your home. Having a new roof is not nearly as much fun as a couple of weeks in Maui, but if you don’t replace your leaky roof it’s gonna cost a lot more when the drywall and insulation get soaked.

Failing to spend money on national needs is not much different. The most obvious comparison is with the physical infrastructure that has deteriorated so badly that deadly accidents occur on a regular basis. A big bridge plunges to the river in Minneapolis. An old dam is breached in South Carolina. Trains derail all over the place, creating deadly fires, or colliding because the “new” safety features now over twenty years old were never funded. The electric grid is dangerously outdated, and could be hacked or just break down on its own. Air control systems experience failures, sometimes with serious consequences.

The count of badly decayed bridges, roads, and so on, is sky high, and is getting higher every year, and still we do almost nothing about it. We do nothing about it because Congress is controlled by people who don’t seem to understand that, first, a single bad accident is far more expensive than it would have been to fix the problem in the first place. Second, the longer we wait, the more expensive it will be. Delays in infrastructure repair and maintenance also have added costs in lost efficiency that is borne by business. When transportation routes are closed by a collapse the businesses that use them aren’t gonna like it.

In short, you can’t save your way to strength by cutting the budget for everything. Certain members of Congress think we will somehow be able to “save money” by spending nothing on the essential needs of all citizens and the infrastructure. They’re wrong. Tragically wrong.

What Personal Independence Really Means

The Europeans who came to the New World were a hardy and ingenious lot. For centuries there were no stores where they settled. If you wanted something you had to either make it from raw materials or grow it. We even had to build our own houses. The few manufactured things came from the Old Country, and tended toward the very practical. Axes. Calico. Hunting guns. This is where the ideal of the strong and independent American came from.

Half a millennium has passed, and everything we could conceive of wanting has become available to us without having to chop down a tree or plow a furrow to get it. Most likely it came from China, or some other place in the poorly-paid world. But as this sea change occurred we lost much of our ability to survive on our own.

Most of us don’t know how to roof a garage, rewire a lamp, or grow and can tomatoes. Many of us couldn’t change the oil, poach a fish, install a new pane of glass, or make beer. Instead of fixing something easily repaired, we buy a new one, which is possible because so many consumer goods are inexpensive on the global market, where fair pay is rare.

Independence is the Republican ideal, one they take pride in and wrongly presume nobody else does. The Republican belief in the centrality of the nuclear family is supposedly based on the Bible, with a dominant father who makes all the decisions, a supportive and submissive wife, and obedient children. There are things to recommend this scenario. But most of those that are commendable are not specifically Republican. They are just common sense. You may never need to change a tire, but if you are stuck in a wild place with a blizzard coming on, you want to know how to do it. Politics has nothing to do with it.

Times have changed since biblical days. For one thing, the modern world knows that women are not inferior help-meets, but their abilities are fully equal to men’s in almost every way. Women have become a powerful strength for the modern world, one that spells the difference between modern and antiquated. Only in the conservative Muslim world are women viewed as worth some fraction of a man’s value. And among simplistically minded Republicans.

The more extreme conservatives imagine a world in which government is minimized to the point that almost nothing is supported by taxes except a powerful military. We the people are required to be independent and strong, as our pioneer ancestors were. And it’s true that we could certainly as a nation cultivate more of that can-do independent attitude. After all, even if our parents didn’t teach us how to install a new toilet or how to dry fruits for winter, we can easily get books and DVDs that tell us how.

But when we get really sick, being independent may not help. Only professional medical care may be enough. And where do we get that, if our job doesn’t give us enough income to pay for health insurance, and the bill is going to come to $100,000? And what will happen to us when we can no longer work, if our income barely covered common expenses our whole life, and we simply couldn’t save enough for retirement?

The value of independence comes to an abrupt end there. Your neighbors and your community may help, but only the concerted effort of everyone acting for the common good will be enough. That is, as a nation. The classic need, of course, is medical, but there are many other reasons that only community action, state action, or national action is the only reasonable course. What does government give us for our taxes? Thousands of things. The very thought of each family being responsible, for example, for the street, sewer, and water supply in front of our house is ridiculous. Imagine yourself digging in the street with a pickaxe to repair a water line.

The essential reason that we cannot rely on ourselves individually for all these things is that to do so is not economically efficient. It is far less expensive and far more practical to pay for street services from a tax-supported work crew that uses city-owned machinery. This is true for thousands of services that only the government can supply efficiently. That goes literally double for health care.

We pay double what good national medical care programs cost, and for the same reason: our health care is private, non-efficient, and for-profit. There is efficiency in size, and national plans provide the largest possible funding base. National plans also have the power to regulate and control costs. They also simply do away with most insurance costs, which presently consume one out of every three dollars we spend on health care without providing any benefit at all.

Being strong and independent is a good idea, and something we have lost too much of. But the value of personal independence ends with the many things that require expertise and cooperative effort. There are many such things, virtually all of which are most efficiently paid for with taxes. The most important of these, the one that costs us double, the one we don’t currently pay for with taxes, is medical care. National health care would save us many billions, and save many lives that are presently lost because of unaffordable cost. Even more, the loss of any American to an untreated medical condition costs us more in social costs than it would have cost to save her.

We remain the only nation in the advanced world that lacks affordable medical care for everybody because we have no national plan. This is a national tragedy that is completely unnecessary.

Why Democratic Socialism Isn’t Marxism

Many Americans are deathly afraid that the US might magically turn into one of the failed Marxist-communist countries of the defunct USSR. Or Cuba. There are endless conspiracy theories making this claim, the most recent being the paranoia over the routine Jade Helm 15 military exercise, which concluded with Texas still free. Everyone should relax. Even the 2nd Amendment gun nuts should relax. There isn’t the slightest chance that commies or anyone else will “take over”. The few communists scattered round the US are about enough to form a debate club.

We already have a bit of socialism, and nobody but hardline libertarians objects. Libertarians basically want no government at all. In the recent Republican “debate” (a surreal event that didn’t remotely resemble a debate) everybody’s favorite loudmouth Donald Trump pointed out that we’ve had a graduated income tax for a long, long time, yet nobody is calling it socialism. Here are some other elements of socialism we’ve had for a long, long time: a deduction for mortgage interest; Social Security; public schools; national parks. Public anything, in fact.

Marxism means the state owns everything, not some things. But that’s not what democratic socialism means. The modern world is impossible without social cooperation, libertarians notwithstanding.

The conservative Republican belief is that unfettered private enterprise is always best. But that’s not at all true. Unfettered burning of coal in China and India causes more than two million deaths from lung diseases every year. The unfettered clothing industry led to dangerous factories, some of which burned or collapsed, causing thousands of injuries and deaths. How much is one life worth? Your life, for example. My bet is that you are unwilling to donate your life to boost someone’s “profit”.

Conservatives are right that the most efficient path is the best. It’s just that the path they want is not the most efficient, because it ignores air pollution and factory disasters in order to minimize costs and maximize profit for the bosses. Death for many is the price of that profit for a few.

The poster child for economic efficiency is national health care. Republicans accept the “socialism” we already have, but oppose national health care because it is “socialism”. But our awkward and grossly expensive health care system fails utterly to protect many millions, who are in danger of dying from common, easily cured conditions. So our government fails on that account. An untreated “cold” that is actually mild pneumonia can easily lead to death. So can an infected injury. More serious diseases such as cancer, diabetes, and heart disease cost more to treat, and few without insurance can afford treatment. Private health care is on schedule to cost $10,000 per person next year, impossible when family income is $35,000.

The case for national health care is simple: the greatest cost efficiency occurs when the entire population is insured; national health care reduces cost by half, and insures everybody. National health care is not “free”, because we all pay through taxes, but it’s a whole lot cheaper. Unfortunately, many Americans fail to understand that $5,000 in taxes for complete medical care is a bargain compared to $10,000 in private premiums or, say, $250,000 for cancer treatment paid out-of-pocket.

A healthy population saves billions of dollars. For example, when an uninsured parent dies, we all must shoulder the responsibility for the minor children. When a child misses a lot of school because of untreated disease, the public pays in the long run.

This is the essence of democratic socialism: things most efficiently paid for yourself that not everyone needs (a new car, for example) you should pay from your own pocket; things that everyone needs are often most efficiently paid for through a national program.

Now, there is legitimate debate about what things should be paid for through taxes. It’s not necessary or useful to nationalize the coal industry, for example. But Big Coal has received “socialist” government subsidies for a century, which we donate to the industry from our taxes. Yet they have gotten away with scandalously dangerous and unhealthy practices forever. Coal subsidies and all other antique energy subsidies should end forthwith. What these industries need is vigilant regulation, not subsidies.

I would argue that every qualified student should be able to receive an education beyond high school, all the way through advanced degrees, paid for by public moneys. Why? Because an educated populace is in the national interest, and the high and concentrated costs of advanced education put it outside the ability of many families to pay. Paying for college from taxes is far less expensive, as can be seen by looking at any democratic socialist country that provides it without cost to everyone. Ask any recent graduate with an education debt to repay what they think about it.

So. Democratic socialism? Bernie Sanders is a democratic socialist, and we should not forget that virtually every successful Western or Western-inspired nation except ours is democratic socialist. Life in those places is better than our lives, difficult as that is for many Americans to believe.

The Complexities of Work and Pay

The whole subject of work and pay is more complex than we usually suppose. For one thing, technological progress has greatly increased economic growth in recent decades, making a shorter work week possible, as predicted by John Maynard Keynes in the 1930s. Unfortunately, almost all of the benefit of technological progress accrues to capitalists, contributing more to unemploy-ment than to a shorter work week.

Most people don’t give a damn about billionaires. But they do care—a lot—about fairness, and they see that the inequality on the rise is inherently unfair. And for the poor it hurts, because they are being punished for being poor.

Poverty is a shortage of money, not a fault of character, as Barbara Ehrenreich and many others remind us. If you work, you should be able to survive at a decent level. But this is not always true, and in fact is increasingly untrue.

Poverty is a shortage of money,
not a fault of character.
Low pay is created not by the people who earn it,
but by conservative capitalists.

Living Wage is the most important domestic need in the US right now. Nobody can survive on minimum wage. Many other problems would be solved with Living Wage. Not nearly enough attention is being paid to this, and the concept of being able to live on your earnings seems to be especially challenging to capitalist Republican minds. Republicans have decided low pay is a character flaw, one that especially infects African-Americans. This is an odd belief, because low pay is created not by the people who earn it, but by conservative capitalists who have never had to deal with the condition.

It’s also worth recalling that every member of Congress is wealthy, and half or more are millionaires. This means that every member of Congress is far removed from those who struggle daily to survive, and have little understanding of how difficult it is.

We have reached a point where
a shorter work week is feasible,
but challenging.

Much of the technological change we have made is akin to monopoly. Capitalists should be rewarded when they contribute to progress—but not in perpetuity. Carlos Slim is the Mexican multi-billionaire who regularly vies with Bill Gates to be the richest man in the world. His wealth continues to flow in because he long ago managed to gain monopoly rights for communications for all of Mexico.

In the US the 40-hour work week is still the standard, but many people work less, for various reasons. For some, their shorter hours are involuntary, forced on them by corporations that seek to pay the lowest possible wage, with the least benefits possible, so they can maximize capitalist profit. 

Our failure to form a national health plan
is a continuing economic disaster,
wasting perhaps 10% of our GDP.

There are also people who choose to work fewer than 40 hours. This is quite possible, for example, with worker-owned companies, which usually require a certain number of hours, but not 40. In addition, there are people who work, but are not paid. This is sometimes bad, sometimes good, sometimes voluntary, sometimes involuntary.

We should repeatedly stress the fact that equality is correlated with just about any favorable measure of individual and national life you can think of. Good health, low crime, school achievement—dozens of things. The authors Wilkinson and Pickett studied just about everything they could, and reported their findings in The Spirit Level. The correlation of equality with good stuff is so pervasive that the onus is on anyone who disagrees to prove them wrong.

Another point I would like to make is that good federal social programs would help to make a shorter standard work week possible. Since a work week of fewer than 40 hours is rapidly becoming the norm anyway, we should make the most of these programs. Here again, capitalist Republicans want to go in retrograde, holding wages low and cutting or eliminating essential public services like Social Security, and killing off health care entirely. This, of course, would cause rapid additional inequality and poverty. For some reason they think massive misery would make a better America.

Placing personal security
at the mercy of market forces and the rich
is a guarantee of a nation in poverty.

Health care is the single greatest “optional” expense for most people. Private insurance, which would take half of the income of many people, is simply impossible. For several million Americans, the stopgap Affordable Care Act has made it possible to have health care insurance for the first time in their lives. This has literally saved thousands of lives that would have been lost for lack of medical treatment. While subsidies are a national expense, the added benefit of having restored someone to the ranks of healthy workers undoubtedly results in an economic credit over time. The opposite is true if Obamacare were to be rescinded.

Although Obamacare has already been a huge benefit for the country, there are still many millions without medical care. Obviously, a national health care plan would cure that, save hundreds of thousands of lives, and save hundreds of millions of dollars, maybe billions, both because national plans cost half what we pay, and because having healthy citizens is a huge economic benefit for the country. Our continued failure to form a plan wastes perhaps 10% of our gross domestic product.

National programs are inherently
more cost-effective because of economies of scale
and much lower management costs.

While national health care is the biggest national need, Social Security and other programs are in need of updating to current conditions as well. Each would create individual and national benefit, and their totality would bring us considerably closer to a modern work week.

The capitalist conservative position has always been “every man for himself”. This is hypocritical, because capitalist conservatives pay whole regiments of expensive lawyers devoted to creating favors for themselves. A handful of pro bono activists help the rest of us. Placing Americans at the mercy of market forces and the rich guarantees a nation of poverty.

National programs are inherently more cost-effective because of economies of scale and because of much lower management costs. It’s the only way people can survive on modest wages. National health care in particular would eliminate some 25% of health care cost that is presently wasted on insurance paperwork.

Paying attention to work and pay conditions, and particularly to health care, could make the nation stronger, wipe out most poverty, and usher in a new more benevolent era for most of us. But it’s a complex situation that needs careful study, and, above all, facts. Facts are pretty scarce on the ground these days.

On Losing Our Souls to the Socialist Nightmare

Capitalist conservatives misunderstand the liberal desire for things like national health care, free public education, and Social Security protections. What liberals want is these things at a reasonable price.

If it could somehow become reasonable for each of these things to be affordable for working people, there would be no reason to want efficient national plans. But it isn’t reasonable, and there are several explanations for why that is so. Primary among these is the plain and simple fact that private purchase of these goods is far more expensive than collective spending for them. Private plans are more expensive than government plans because private companies must earn profit, so their product costs more. And the free market economy means that vendors can charge whatever they can get away with, which is plenty.

The ultimate in economy of scale is obtained with national plans, with the least individual cost. Health care in our for-profit private capitalist system is literally twice as expensive as the national plans that operate in every single advanced nation except ours, and insure every single person, unlike our non-system. Moreover, the national plans are well liked, and health care under national plans is better than American plans, which fail to provide health care for many millions.

The ultimate in economy of scale
is obtained with national plans.

With these goods costing so much, perhaps the answer would be to increase wages enough that such purchases would be practical. Alas, that’s really a rather stupid idea, to pay enough just so the 200% inflated cost is affordable. Why not just deflate the cost to normal? But capitalist conservatives are strongly against paying wages even above poverty level, and don’t want to pay enough for health care. They are perfectly happy with minimum wage as it stands. After all, they aren’t suffering, and don’t see why wages for others should be improved, since the problems of the poor stem entirely from their failure to work hard enough. Unfortunately, many millions can’t afford health care insurance at all, because it costs about half of what they make in a year, working full time.

Another way the poor fail is by not saving. They simply have no desire to set aside money for their own retirement, whereas capitalist conservatives are much wiser. They save plenty of money for retirement, and in addition can pass on an inheritance of millions to their progeny. The poor, of course, waste their entire minimum wage paycheck.

It’s not just the poor who fiddle away their future, but all of us grasshoppers. The wise among us who earn enough do put away money for retirement, but the need catches most of us by surprise in middle age. We are not stupid, but we lose the benefit of decades of compound interest by not paying attention early enough. Lately, the average American of fifty or sixty has almost no savings and is woefully unprepared for looming retirement because of a half century of stagnant income and the current disaster bequeathed us by Wall Street criminals. But how might it be possible for anyone earning minimum wage to save at all, when even rent of a one-bedroom apartment is beyond their reach everywhere in the US?

And by the way, the median age of people earning minimum wage is not 16. It is 35.

Bernie's wasteland

Tom Toro, The New Yorker, June 2015

The biggest mystery is how people on the right can imagine that all those countries that have the great benefit of national plans can be thought of as socialist nightmares. Everything they have is better than what we have. They have good health care and good health; no one ever declares bankruptcy for medical reasons, whereas it’s the most common reason here; their schools are either free or affordable, all the way through graduate school, and many even provide living expenses for college students; all of them provide for a retirement without privation; and all enjoy benefits in their working years like Living Wage, generous mandated paid vacation, free healthcare, paid leave after childbirth, childcare allowances, and numerous other niceties.

How can people on the right imagine
that all those countries that have national plans
be thought of as socialist nightmares?
Everything they have is better.

Ah, but taxes. Taxes! Their taxes are awful, far more than we pay. Isn’t that true?

Not really. Remember that we have millions without health care, millions who can’t afford college or who end up in debt for tens of thousands of dollars, and millions who must depend entirely on inadequate Social Security for retirement when they are no longer able to work. The plain and simple fact is that even the highest tax level in the Socialist Nightmare countries, that of Belgium, is far less than we would pay for the same services if we bought them ourselves. But we can’t afford the same services. Not even close. We don’t even earn enough to get these basic services through inexpensive national plans, let alone individually via our for-profit private enterprise.

Our pay and work laws are mostly determined by capitalist conservatives, who haven’t the slightest need for more money. They are already at the tippy point of the pyramid, up above the all-seeing Masonic eye, and have neither understanding of nor interest in the economics of the rest of us.

After all, anyone who isn’t rich simply isn’t working hard enough. Isn’t that so?

Why National Programs Are Essential

We are moving toward a 20-hour work week. It is mostly unintentional, but it is happening nonetheless. This gives us an opportunity to make a 20-hour work week the standard, which potentially would improve the country in numerous ways and put us at the forefront of advanced nations. But it cannot be done without significant changes in how we pay workers and how we fund health care, retirement, and higher education. For these, only national programs can fulfill the need.

John Maynard Keynes suggested back in the 1930s that this would happen. Given advances in technology, as well as other improvements in efficiency, it is now possible to have the work week he foresaw. But getting from here to there is a big and politically difficult undertaking.

We are moving toward a 20-hour work week.

Capitalism is at once the cause of a shorter week and the thing that prevents its achievement. This is because workers cannot control their own working hours, have no stake in technology, and are usually underpaid. It is capitalists who own the machines of modernization, and Republicans who want to pay as little as possible, and for heaven’s sake, no “socialism” of national things like Medicare and Social Security.

Low-wage employers have for decades limited employee hours in order to stay under the benefits threshold. This is the McDonald’s/Walmart strategy. It has been disastrous for the poor who work these jobs, and the practice drains from government welfare programs that are forced to make up the difference between inadequate wages and crucial life needs. In practice it’s yet another transfer of wealth to the wealthy.

The McDonald’s/Walmart strategy
has been disastrous for the poor.

The economic inequality we have now came about because of the increasing misuse of wealth, and conservative insistence that minimum government and overpriced “free market” are the way to go. The many millions who are forced to survive on minimum wage are punished with poverty by this concept. Either we have to pay enough for workers to buy private health care et cetera for themselves, or we have to establish efficient government programs.

Capitalists and Republicans want it neither way. They would prefer that workers provide overpriced private services for themselves, but they have no interest in paying enough to make it possible. National programs are inherently more economical, and offer our only chance for good benefits at reasonable cost. That’s why they are found in every other advanced nation but ours.

Capitalists and Republicans
want workers to pay for private services,
but won’t pay enough to make it possible.

There is no rational objection to be made to such changes. There is only ideological political opposition, which centers around the false idea that less government and the “free market” are always better, and anything national is like Soviet communism. But those beliefs result in ever widening inequality, decline of security for wage workers, ever eroding democracy, and loss of corporate competitiveness.

Forty-hour jobs with good benefits are increasingly rare, and a big factor is that the cost of “free market” health care is literally double what it costs with superior national plans. Having to pay for private health care reduces international competitiveness for US corporations, who compete with workers covered by less expensive national care.

The three most obvious worker needs are health care, retirement funding, and higher educational financing, all of which are more efficient and far less costly under national programs.

National health care is the primary candidate, because a national plan would cut health care costs literally in half. This is the most important of the changes that would make the 20-hour week possible, and it’s hard to overestimate the value national health care would have for the country. It would greatly improve the health of the working population, which by itself would bring significant financial benefit to the nation, since every adverse health condition among the work force creates cascading public costs and loss of efficiency.

National health care
is the most important of the changes
that would make the 20-hour week possible.

Minimum wage needs to become Living Wage, and significant improvements need to be made to Social Security. SS is by default the entire retirement income of people who work low wage jobs, and would not be adequate under 20-hour Living Wage without improvements.

Education is the third underfunded major cost of life in the US. The number of advanced nations that provide free higher education is growing rapidly, and the US could easily to do the same thing. Many universities could do it immediately with no other changes. There are many benefits of high levels of education in the workforce, for workers and owners alike. 

An unrecognized consequence of good national programs is that take-home pay could be far lower, yet still adequate. Workers would pay significant sums for national programs, but in the end the cost would be lower because they would not have to pay for expensive private plans. Personal security would therefore be greatly improved.

Greater changes have been made in the past. The 72-hour work week with absolutely no benefits of any kind went the way of farming with horses and hand tools. The radical 40-hour work week that replaced it has outlived its usefulness. Improvements in technology have made a much shorter work week possible, and we should seize the earliest opportunity.