Professor Wolff, In addition to the concept of Wage Subsidies, which are notable in that even Republicans like Marco Rubio have shown favor to them as policy solutions to modern capitalism's economic woes and inequalities, I was hoping you could discuss your views on a Universal Basic Income- once again in one of your videos such as Economic Update if possible- although an answer here would also still be appreciated. The idea of a Universal Basic Income seems most appealing in combination with a cut to the Minimum Wage- in that if appropriately balanced it would increase workers' standard of living (by raising incomes and depressing prices) while SIMULTANEOUSLY reducing the incentive for employers to automate or outsource jobs- thus generating increased employment and partially alleviating modern capitalism's income inequality crisis while also increasing economic efficiency by making the "true" cost of labor for an employer more similar to the market-based of labor, ultimately leading to better solutions for problems like manufacturing needed goods (for instance not making good in overseas factories when there are unemployed workers with the necessary skills right here in the United States- who would work for less than the Minimum Wage if their income were supplemented with a Universal Basic Income...) Please discuss this if possible- inclyding, ideally, the best way to pay for it. I would think that ideally a UBI would be best paid for with an increase to the Capital Gains Tax (stock prices and dividends would increase due to increased corporate profits if the Minimum Wage were eliminated, providing the larger tax-base to accommodate this), although I could always be mistaken...
Wage subsidies appeal to capitalists in so far as they enable them to pay lower wages. In capitalist societies, there would be endless political struggles (largely won by capitalists whose wealth buys parties, candidates etc.) over who pays the taxes to support wage subsidies. In the end, employed and thus non-subsidized wage workers would shoulder the taxes used to provide subsidized wage workers with those subsidies. This would set up the same social tensions that unemployment insurance and all other forms of welfare for the poor and/or unemployed....social tensions eventuating usually in a minimization of such subsidies etc.
Much the same set of problems beset UBI and for the same reasons.
UBI is now getting attention chiefly because a few savvy economists have pointed out that capitalism's endless production of the unemployed (its failure to provide jobs for the people in its societies) has rendered the irrational system vulnerable to the accumulating rage, anger, and anti-social potential of those it fails to employ etc. Thus for the last 150 years capitalism has provided palliative welfare payments to mitigate the antagonism of those disserved by capitalism. The savvy economists point out that the mass of confused welfare schemes and the mass of public employees administering them cost tax-payers more than what a UBI would entail. That is, UBI could be a cheaper way to solve capitalism's problem of an endless failure to employ.
This strikes me as an irrational "solution" to the system's irrational performance. A transition to a full-employment economy based on enterprises structured as democratic worker cooperatives could simultaneously solve these problems by providing meaningful work to all together with much less unequal incomes (determined and distributed democratically) and thus much less in the way of divisive social struggles over who pays what in taxes and all the other divisive social struggles over "redistributive welfare policies."
Its better to not distribute income and wealth unequally in the first place than to do so and then tear society apart fighting over redistribution.
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