Goals and Policies

This page is a summary of political and economic goals that are important to me personally, along with policies that I find particularly interesting as means toward achieving these goals. Of course, there are many social causes that I agree with, and find important, that are not on this page; here I'm trying to focus on goals and policies that I personally am most interested in studying and advocating.

This is an unfinished work in progress in three ways. (1) The writing is fairly rough, as my first goal has been just writing the basic ideas down, rather than expressing them with eloquence. Hopefully that will improve fairly soon. (2) There are a number of ideas that I have left out, that I probably should include. I'll keep working on that. (3) The statements below represent a provisional understanding of economics and politics, an understanding that I am working full time to develop and improve. So, I am very open to discussion and debate on all of the points that I make, in the sense that there is a good chance that I will be able to change my mind.

Democracy

I believe that democracy holds a hope for the future of humanity that has only been partially realized. Perhaps more than most people, I have faith in the relative sanity of the popular will, but I believe that this sanity is often lost through the distortion of poor voting systems, poor information systems, and problematic education systems. I believe that improving these institutions could create a fully functional democracy, which would be both an end in itself, and a means toward substantially better public decisions.

I believe also that a complete democracy should include a democratic media, a productive economy where decision-making is as decentralized and participatory as possible, and an education system that helps all citizens realize their intellectual potential.

Alternative voting systems

Please see the voting methods pages. In short, I believe that the plurality system used in the US doesn't provide majority rule, provides very weak accountability for elected officials, and should be blamed for a two party system where people often vote for the lesser of two evils. Alternative systems with substantial promise exist for executive elections, legislative elections, and direct-issue voting. Three of these are described in the following sections.

Pairwise comparison (Condorcet)

When majority rule is the goal, then I recommend an election method that uses the pairwise comparison principle (also known as Condorcet's method), and that always chooses a candidate in the minimal dominant set. I believe that this would provide majority rule, and bring a heretofore unheard-of degree of competitiveness to major executive elections, and in the process significantly raise the accountability of executives, the standards that they are expected to meet, and the ability of voters to have their voices heard. Also, I believe that it would lead to a process that is less polarized than most major plurality elections.

Single transferable vote

When proportional representation is the goal, I recommend a single transferable vote method, rather than a party list method (the latter is much more common). With a good computerized ballot, there is no natural limit to the district magnitude, and it would be practical, for example, to elect the entire US House of Representatives in a single 435-seat district. This would enable people to elect representatives who much more closely represent their own values, because instead of needing to compromise with up to 1/2 of the district population in order to elect a candidate, each voter would only need to compromise with 1/436 of the district population.

Delegable proxy: public sphere

Please see my essays on direct democracy by delegable proxy and representation by delegable proxy. In short, delegable proxy is a fascinating concept that seems much more able than traditional representative democracy to satisfactorily cope with the information paradox of democracy in large societies. This paradox is that it is often inefficient for all citizens to be fully informed about all public choices, but that if only fully informed citizens vote, the equal power axiom of democracy is not satisfied. The system of representative democracy is in part an attempt to address this problem, but if most citizens are not well informed about the character and values of their representatives, the same problem is reproduced. Delegable proxy, on the other hand, allows citizens to delegate their vote to someone whom they know well enough to trust, who can then choose to cast that extra vote or to delegate it to someone else in turn. In a sense, this can be regarded as a radically pure form of democracy, because everyone has the power to vote directly on issues, and because everyone has the power to delegate their vote to a representative of their own choosing.

Democratic media

The media is democratic to the extent that control over content is decentralized. Because of the necessity of public information for public decision making, if control over media content is overly concentrated, democracy suffers. Also, a democratic media is an end in itself, in that people are more able to express themselves, and in that there is a wider variety of media content to choose from. Because media has such a powerful impact on many people's perception of reality, excessive consolidation in the media industry can lead to a situation where a few powerful corporations can tinker with the national psyche in the interest of their own profits, and those of their sponsors.

In the following five sections, I discuss policies that might enhance the democracy of the media.

Low cost distribution

The media becomes more democratic as the number of people who can produce and widely distribute media increases. Thus, I believe that a low threshold cost for media production and distribution can provide a tremendous benefit to society. Already, video production technology is within the reach of most Americans, and independent producers can share video to some degree on the internet.

As the technology improves, independent producers should be able to provide high quality video, with little download time, to a large majority of internet users. Television can be increasingly integrated into the format of the internet, so that people can just as easily download content at their leisure from the world wide web, rather than having to watch it when it is broadcast. Given this kind of integration, it is fairly easy to imagine a situation where independent video is on more or less equal footing with video produced by television studios, from an ease of access standpoint. One link brings to you the independent video, another link brings you to the studio product.

Although the established studios would of course have an advantage in terms of promotional resources, I believe that a very good independent video could easily find a wide audience via word of mouth. The web sites of media corporations will link to their own shows, but the web sites of individuals will link to shows that they enjoy, facilitating the word of mouth process.

Hopefully, the process of making micropayments online will soon become quicker, easier, and less of a perceived risk. For example, internet users could happily pay something like 25¢ to download a commercial-free independent video, which would be a negligible cost to them, but could provide substantial revenue to the producer if the video becomes popular. Of course, the price of any piece, and whether it be a voluntary contribution or payment necessary for download, would be up to the producer.

Because a loss of net neutrality would most likely raise the cost of distribution, which could provide a prohibitive barrier to the entry of independent content producers, net neutrality should be protected.

Currently, many cities have public access stations that provide inexpensive access to video production equipment, and play independently produced videos on cable TV. In the future, perhaps they will provide web space and computer time to producers, in addition to/instead of granting them time on cable TV.

Advertising tax

Although advertising surely has some social value (i.e. in providing information to consumers), it should be fairly obvious that this value is outweighed by its social cost. Hundreds of billions of dollars are spent on advertising each year; it is unlikely that the information conveyed by these ads has such a high social value, and that the resources consumed in the process would not yield higher social benefit if applied elsewhere. Rather, most advertising benefits one firm at the expense of other firms, and while most ads are useful to some consumers, they are usually more of a nuisance than anything else to the majority of consumers. Thus, to bring advertising expenditure closer to a socially optimal level, and to generate revenue for more socially beneficial projects (for example, a public consumer information network), it is logical to levy a tax on various forms of advertising, primarily the types of advertising that are most expensive and easiest to keep track of, such as television advertising.

Consumer information network

I believe that a consumer information could provide much greater social benefit than most advertising, at a much lower cost. Of course, private advertising will always exist, but hopefully it can be supplanted to some extent by a public information network. The network would provide information about a vast variety of products and services directly to consumers. It would cover as many products as possible, and would combine information from the seller with feedback from other buyers, and in some cases, appraisal by independent product testers.

Of course, many networks already in existence make interesting progress towards this goal, for example Consumer Reports, Craigslist, and Amazon, to name only a few. However, I suspect that in some ways one large network would be able to provide benefits that a multiplicity of smaller networks cannot. Therefore, I suggest that it would be worthwhile for the government to create such a unified network.

Campaign finance: disallow corporate contributions

I have a hard time understanding why corporate contributions to political campaigns should be legal. Corporate spending is usually assumed to be driven by profit motive, rather than altruism. Thus, if a corporation contributes to a candidate, it is most likely because the corporation expects the candidate to influence policy in a way that increases its profits. If they are correct in this expectation, I think that this is an illegitimate and corrupt way to make policy.

If, on the other hand, it is argued that corporations make campaign donations out of altruism, i.e. a conviction that this candidate will better serve the public good than his opponents, this seems quite irrelevant to the purpose of the corporation, and I have to wonder why it was chosen as a conduit for this transaction. If there are individual stockholders who are interested in making campaign contributions, I suggest that it shouldn't be hard for them to either donate directly, or find an intermediary institution that specializes in promoting a particular political agenda, rather than producing a private product or service.

The harmful possibilities of excessive corporate influence on politics are too numerous and hopefully too obvious to state.

So, I recommend a nationwide ban on corporate contributions to political parties, political campaigns, politicians, etc. This also means that if an organization receives corporate money, it can't contribute money to the politicians, and so on (to avoid money laundering scams).

Enhanced public sphere programming (debates)

Although we do have some public interest television programming in the US, it could probably use a shot in the arm. For example, it would be interesting to have a venue for political debates and discussions that are more authentic, more frequent, and more accessible to viewers.

In recent presidential debates, the candidates have not been having genuine discussions, but rather are addressing each question with a prepared or semi-prepared political speech. After two or three such speeches, each issue is discarded, without any resolution, without only the most minimal opportunity for the candidates to address each other's arguments in detail, explore how their differing assumptions may lead to differing conclusion, point out logical flaws when they occur, etc. Factual errors are the rule rather than the exception, and they are not corrected. In short, the entire event is more of a verbal performance piece than a venue for real content.

Better debates are certainly possible. I suggest a system where candidates have a given amount of time for each issue, but few restrictions on how that time is used. When candidate A is done speaking, he will press a button to buzz out, and thus stop his clock from running. At this point, candidate B may pause to consider A's statement before he buzzes in. During this in-between time, neither candidate's clock is running, and both candidates may request factual information from independent fact-checkers standing by at computer terminals. When the debate is broadcast, these pauses can be edited out.

If alternate formats like this are successful, then I can imagine that such debates could be held more frequently than is currently customary, and not just between contenders for a current office, but for example between two party leaders, or between two congressmen on different sides of an upcoming vote. (The debates need not be acrimonious; hopefully there should be a focus on solving problems and finding common ground, rather than zero-sum political one-upsmanship.) It would be helpful if the government could store the video of these debates in an easily-searchable database, so that they are available for download.

Ideally, political campaigns would center more on these debates than on paid political advertising, thus lessening the influence of money on politics.

Education

I believe that improving the education system is a key to improving democracy. However, I should note here that improved education should be an end in itself. I believe that humanity is characterized by a desire for knowledge, and that if this desire is frustrated or discouraged, humanity suffers. Conversely, I believe that there is an authentic joy in the unrestrained development of the human intellect.

In the following sections, I briefly discuss three ways in which the education system can be improved.

More consistently well-funded, less stratified

There is a great deal of stratification within the US school system, such that many poor families have to send their children to a school that is clearly lacking (e.g. in terms of resources, class size, teacher quality, safety, etc.). The injustice of this is obvious. It seems that there should be some kind of system where public school funding is more equal and consistently adequate, and where the quality of public schools is comparable to the quality of private schools.

As for higher education, I think that the government should try to make college affordable for everyone who wants to attend, preferable without saddling students with debt.

Emphasis of creativity and problem solving over obedience and hierarchy

In my experience, many schools emphasize obedience over intelligence, and train students to unquestioningly embrace the status quo rather than to be critical thinkers capable of democratic participation.

Ergonomic classrooms

Many classrooms, from elementary school through college, provide students with extremely uncomfortable seating. In my opinion, if students are less comfortable, it will be easier for them to pay attention, and their experience will be more pleasant and less alienated. Different people have different body types, and are comfortable in different positions; it is important to provide seating options that take this into account.

Economic democracy

I believe that we should aim for greater democracy in the private sector of the economy as well as the public sector. By this, I don't mean that production decisions should be made via majority rule; I imagine that this would be much worse than the current system. What I do mean is that the power to make production decisions should be less concentrated. For example, if wealth was more evenly distributed, and if large firms and financial institutions used methods such as delegable proxy to give more power to smaller shareholders, I would consider this to be an advance in economic democracy.

Greater wealth equality

I address the topic of greater wealth equality more generally below. Here, I'd like to mention that I see it as a primary component of what I call economic democracy. If wealth is highly concentrated, then firm ownership is likely to be highly concentrated as well, along with the authority to make the firms' decisions. I consider this to be fundamentally anti-democratic.

Delegable proxy: private sphere

Above, I briefly discuss delegable proxy as a tool for public decision-making. Again, please see my delegable proxy papers [1, 2] for more detail on this subject. I believe that this tool can be applied equally well to private decisions. Almost any organization with a sufficiently large membership can potentially benefit by using it. (E.g. unions, schools, churches, etc.) The larger the organization, the more important the delegability feature becomes. One particularly interesting application is to publicly traded corporations. Many corporations allow shareholders to vote by proxy, but in many cases, shareholders do not know much about the proxies whom they designate. If corporations were required to allow for delegable proxy voting, then I as a small stockholder could potentially delegate my votes to nonprofit organizations that shared my values with regard to corporate policy. (I should retain proxy vote rights even if my ownership of stock is brokered by an intermediary agent.) This could help corporate policy to conform more closely to the values of ordinary citizens, just as the general proposal could help government policy to do the same. Hence, the use of the delegable proxy system, combined with greater wealth equality, could bring us closer to economic democracy as well as political democracy.

Equality

Like democracy, I view equality as a primary goal for the advancement of humanity. As mentioned above, I believe that (1) equality promotes democracy in the private sphere as well as the public sphere. I will also explore some other possible benefits of equality in later sections below. For example, I suggest that (2) greater equality could lead to greater bargaining power for workers, and thus better working conditions; that (3) greater equality could lower the supply of labor in some cases and thus decrease involuntary unemployment. (4) I also believe that wealth tends to have a diminishing marginal utility, and thus that overall welfare generally increases as equality increases. A similar argument is as follows: When a person is very poor, most of his income is spent on basic needs, or in general goods with the highest priority. As a person gets wealthier, we expect that a greater portion of their income is spent on luxury items, or lower-priority goods. Thus, increasing equality should serve to shift production away from nonessential luxury goods, and toward basic needs.

There are other obvious benefits of equality, perhaps too many to mention. I believe that there is some loss in human dignity when inequality becomes too great, that is, when those with less wealth and power are compelled to humble themselves before others in order to earn a decent living for themselves and their families. I believe that a society with less stratification is one with a greater experience of fraternity, and a diminished experience of alienation. Also, inequality can be a cause of violent conflict; when the rules of society appear to be greatly favoring some at the expense of others, the less well-off have a diminished incentive to obey these rules.

Progressive taxation

The most obvious way to reduce inequality is a system of progressive taxation. If inequality is too severe, then making the tax system more progressive is often a reasonable solution.

Wealth tax

I believe that wealth inequality is the proper measure of economic inequality, and most of the significance of income inequality is as a cause or an indicator of wealth inequality. However, strangely, most measures of inequality focus on income, perhaps because it is easier to measure income than wealth. As measures based on income are typically less than measures based on wealth, we are usually underestimating and understating the total amount of inequality.

Also, we tend to tax income instead of wealth (with some exceptions, e.g. the property tax). I present three basic arguments against this.

1) An income tax is less effective at redistributing wealth. For example, imagine that before the year 2006, person A has $5 million, and person B has $0. In 2006, person A earns $90,000, and person B earns $100,000. Now, at the end of 2006, person A has $5,090,000, and person B has $100,000. However, if we use an income tax instead of a wealth tax, person B pays more tax than person A. If our goal is to reduce inequality, then we should take more money from people who have more money.

2) An income tax more directly reduces the incentive to work. Because a wealth tax is levied on an entire fortune rather than a yearly income, the percentage rate of taxation can be much lower, while achieving the same revenue. Thus, the amount of tax on each new dollar I earn will be lower, and if I am making a decision on the margin about whether or not to work an extra unit of time, the incentive for me to work is less diluted.

3) A progressive wealth tax is less likely than a progressive income tax to punish people with uneven income streams. That is, because a progressive income tax is convex and increasing with respect to income, the average tax over a period of years will be greater than the tax that would be charged on the average income during that period. If the variance of income increases, and the average income stays constant, the amount of tax collected will increase. Thus, a progressive income tax will punish people with higher variance in their income. By the same argument, a progressive wealth tax will punish people with higher variance in their wealth. However, since a person's wealth is generally likely to have a lower variance than their income, especially at higher levels of income and wealth where a progressive tax would apply, a progressive wealth tax will be less punishing to people with highly variable income streams.

Here is an extremely rough sketch of what kind of progressivity I think would be appropriate in a wealth tax, where the percentage given is the amount of tax payable per year. Of course, these percentages can all be multiplied by a scalar if the tax is generating too much or too little revenue, and of course the brackets should be adjusted periodically for inflation. 0-100k: 0%, 100k-300k: 0.1%, 300k-600k: 0.25% 600k-1m: 0.5%, 1m-3m: .75%, 3m-6m 1%, 6m-15m 2%, 15m-50m: 3%, 50m-100m: 4%, 100m-500m: 5%, 500m-1b 6%, 1b+ 7%.

In order to not interfere with people's ability to retire in comfort, it might make sense to allow people to put a certain amount of money into a retirement account that is exempt from taxation during their lifetime, although perhaps the remainder after their death should be subject to all back taxes, before the inheritance tax is applied.

Inheritance tax

The concept of an inheritance tax (a.k.a. estate tax) is closely related to the concept of a wealth tax. (I suppose that it could be viewed as a special kind of wealth tax, that is, one that is collected only when a person dies.) Many of the arguments in favor of a wealth tax apply to an inheritance tax as well. In short, the benefit of a progressive inheritance tax is that it decreases the concentration of wealth.

One possible advantage of the inheritance tax is that it may not dilute the wealth-gathering incentive as much as the wealth tax, if people generally place a higher value on having wealth than on passing it to their descendants. Another possible advantage is that an inheritance tax treats retirees more kindly than a wealth tax.

Again, here is an arbitrary example of the kind of progressive inheritance tax that I have in mind: 0-2m: 0%, 2m-4m: 10%, 4m-10m: 20%, 10m-25m: 30%, 25m-50m: 40%, 50m+: 50%

Consumption tax

An advantage of a progressive consumption tax is that it redistributes wealth (to some extent) and discourages excessive luxury spending, without discouraging saving or work. Because wealth taxes and inheritance taxes could discourage saving, it might make sense to use them in combination with a consumption tax, in order to achieve a desired saving rate.

Although the consumption tax has much to recommend it, I would prefer to use it in conjunction with, rather than instead of, a wealth tax and inheritance tax. Although a progressive consumption tax will cause some redistribution of wealth, it will not prevent some individuals from controlling vast financial empires, and thus will not ensure economic democracy.

Here is another off-the-cuff example of a progressive consumption tax. 0-30k: 0%, 30k-50k: 5%, 50k-75k: 10%, 75k-100k: 15%, 100k-200k: 20%, 200k-500k: 30%, 500k-1m: 40%, 1m+: 50%

For some larger purchases, e.g. houses, it might make sense to allow consumers to pay tax on the purchase as if it was made in payments over a few separate years, in order to even out the year-to-year taxable consumption.

Summary of interesting taxes

I propose a combination of a progressive estate tax, a progressive consumption tax, a progressive wealth tax, and a natural resource use tax (the last of these is discussed below).

Taxes to avoid: income tax, sales tax, capital gains tax, corporate tax, property tax, etc.

An income tax provides an unnecessarily strong incentive against working; a sales tax provides an unnecessarily strong incentive against commerce; a capital gains tax provides an unnecessarily strong incentive against investment; a corporate tax provides an unnecessarily strong incentive against business.

Property taxes are somewhat arbitrary an unfair, in that they penalize the ownership of some types of assets (real estate), but not others. A general wealth tax would correct this unbalance.

Public health care

I believe that the government of any wealthy nation should be able to ensure that all of its citizens can afford a reasonable level of medical care. This is a type of redistribution leading to increased living standards equality that seems hard to deny. Viewing things from the standpoint of overall social welfare, if there are people in need of basic medical care, it seems obvious given the urgency of medical concerns that addressing these needs would lead to a greater increase in social welfare than the extra consumption by the well-off that would take place if no such redistribution occurs.

Below, I will discuss the possible benefits of a system where employers do not typically carry the burden of health care costs.

Education less stratified

I mentioned above that greater equality in the education system is an important component of democracy. It should be obvious enough that it is also an important component of equality in general.

How to avoid capital flight?

If a citizen of country X owns assets in country Y, which country should tax the asset? If it is country X, then I wonder to what extent would an increase in the rate of redistribution within country X cause rich individuals to change their citizenship? To what extent to countries need to "compete" for rich people? Would countries benefit by signing treaties to increase redistribution in tandem, so that they can increase tax revenue without losing citizens?

If it is country Y, then rich people have a strong incentive to move as many of their assets as practical into a country with a low tax rate.

Pay back to people in what combination of goods, flow payments, trust packets?

I have spoken at some length about methods of taking money from the rich, but the question remains: in what form should this money be made available to the poor?

Goods can be divided into two categories: public goods and paternalistic goods. Public goods (or, speaking more strictly, positive-externality goods) are goods such that the individual benefit is less than the social benefit, and such that a market provision will be below the social optimum.

Paternalistic goods are provided by the government in cases where it believes that it will be able to make a better purchasing decision than the recipient, for example giving food stamps or public housing to an individual, rather than the necessary money to buy food or housing of equivalent quality. Paternalistic goods have their advantages, but they should probably be used sparingly, as it seems reasonable to assume in most cases that individuals can make the best decisions about their own welfare.

A flow payment system involves an annual or monthly payment made to the poor, the amount of which should depend on the extent of a person's poverty, as measured in wealth, number of dependents, etc.

A trust packet system would involve a smaller number of larger payments made to an individual at particular points in their life. For example, there could be one payment at age 18, and another payment at age 65.

An argument for the trust packet is that they would encourage saving and reward personal responsibility. Hopefully, the interest from savings would provide some income supplement, and the principal itself would be available in case of hard times, or to make personal investments such as a house or car. To the extent that the trust packets are invested in the market, they would contribute to economic democracy by expanding the number of shareholders. Of course, trust packets shouldn't be the sole form of payment to the poor. If they were, there would be no help for individuals who returned to poverty after spending their packets (through some combination of bad investment decisions, overspending, and misfortune).

When deciding on the system of payments to the poor, one of the primary challenges is to maintain the incentive to work, that is, to make sure that work yields a clear and substantial reward. Hopefully this balance will be easier to maintain as the quality of labor experience improves.

Quality of labor experience

How much suffering is involved in human labor? To what extent is this necessary? To what extent can work become a joyful act, rather than a fearful, painful, or alienated act? Below are a few ideas for policies that might improve the quality of labor experience.

Greater wealth equality, increased worker bargaining power

I suggest that if inequality is very steep, such that there are a large number of people willing to work under any conditions to get any kind of wage that averts starvation, the lack of worker bargaining power will lead to low wages and poor working conditions. Conversely, I suggest that greater wealth equality will lead to better wages and working conditions.

Improved government employment agencies

I propose that governments should aim to create truly excellent employment agencies, to improve the fit between jobs and workers, while decreasing the search cost they incur in the matching process.

I suggest that people often settle for jobs that are not a very good fit for them because they are not aware of the jobs that are a better fit. Hence, if workers seeking employment have more information about a larger portion of open jobs, and employers have more information about a larger portion of workers, the fit between workers and their jobs should be improved, which would raise the quality of labor experience.

Also, I suggest that workers would be more empowered to quit an unsatisfactory job if they were more assured that they would face an efficient and productive job search with a high probability of finding a good match, rather than a chaotic and difficult search with much wasted effort and a high probability of finding only inferior job prospects. I suggest that this would increase workers' bargaining power. Also, I suggest that it would decrease the stress that people experience when working, much of which comes from the possibility of being fired and facing a costly and uncertain job search.

How might the government create a superior employment agency that would meet these goals? To begin with, think of the classified section in a newspaper, or a web site that allows employers with open jobs to get in touch with workers seeking employment. In a sense, these kind of matching services are a particular kind of natural monopoly, in that search costs will be reduced, and the chances of finding an excellent match will be increased, if there is a single site that is used by almost all workers and employers, rather than several competing sites that are each used by a fraction of workers and employers.

Thus, I propose that the government work towards the goal of creating a job listing database that is large and user-friendly enough to be the obvious first stop for any workers or employers who would be interested in posting a job listing or résumé. Of course, people would be free to post classifieds in other places, but the hope is that this would be unnecessary in many or most situations. I suggest that the government employ a decent number of employment counselors who could help people to make full use of the database and to find the best job available.

Of course, I don't have a proposal for the exact design of the database and its user interface; hopefully it would be flexible enough to adapt over time to meet user demands and thus to keep its dominant position. However, I'll mention one idea that is particularly interesting to me, which is to make use of stable marriage algorithms to create optimal matches, that is, when filling a lot of positions simultaneously, to have applicants list jobs in order of preference, to have employers list applicants in order of preference, and to run a simple computer program that uses these rankings to match applicants to jobs.

Improved job training programs

I suggest that selective subsidization of job training could significantly improve the quality of labor experience. The purpose would be to lower the barrier against people entering a totally new line of work, and thus enabling them to try a wider variety of jobs. One benefit of this is that if people get a wider variety of work experiences, it should increase their chances of ending up with something that they really enjoy. Also, variety in itself tends to improve the quality of labor experience, as many jobs become monotonous if repeated for too long without a change. Third, if people have some experience working in very different sectors of the economy, they might gain a bit more of a sense of commonality with one another, by having some sense of the experience of people who hold very different jobs from themselves.

Incentives to allow more flexible work hours (1)

Generally, as a person works more and more hours per week, work becomes less enjoyable, and leisure time becomes more valuable. At the same time, as a person earns more income, the marginal benefit of income decreases. Hence, in theory it seems logical for everyone to work up until the point where the benefit from an hour of leisure is worth more to them than an hour's wages.

Unfortunately, the tradeoff between leisure and work is often not so fluid. For example, instead of being able to choose 30, 40, or 50 hours per week, many workers have to choose between 50 hours per week or none at all. I suspect that in many cases, people would happily do 3/4 of their workload for 3/4 of their pay, but their job won't allow it. Indeed, for many people, the idea of asking their employer for this is unthinkable. They are pressured into working beyond the point where the benefit they receive from work is outweighed by the cost in terms of lost free time.

I believe that if people were more free to set their own work hours, many of them would be a lot happier. Thus, I suggest some kind of policy that would encourage employers to allow more flexibility in terms of how many hours each employee works. Of course, there are some jobs where it would be significantly less efficient to have 6 people working 20 hours each rather than 3 people working 40 hours each, for example. The gain in efficiency from having fewer employees should be weighed against the cost of inflexible hours.

I'm not sure exactly what the best mechanism is to accomplish this, but I'll be thinking about it. One thing that would help, I think, would be to make the distinction between "full-time" and "part-time" work less important, by shifting away from a system where people rely on the "full-time" designation in order to receive health care. That is, to shift away from a system where employers are expected to pay for health care in general.

I also suggest that if there was less of a financial divide between "part-time" and "full-time" work, more people might find it rewarding to work two or more jobs rather than a single job, thus increasing the variety in their work life and substantially increasing the quality of their work experience.

Decreasing involuntary unemployment

Decreasing unemployment has traditionally been one of the major goals of macroeconomics. However, I feel that there are several key approaches to this problem that are being neglected...

Adjusting labor supply and demand
I have felt since I was ten years old that if we unemployment is still too high despite our best efforts to stimulate industry and boost demand for labor, the logical next step is to decrease the supply of labor, that is, to encourage some people to work fewer hours per week. (Of course, for many people who would work fewer hours, this would be a welcome change!) Let's say that we accept the premise that people primarily acquire wealth through work, and that there is a severe imbalance of wealth resulting in poverty. After a certain point, it can be unfair or problematic to redistribute wealth to people who are not working, so the obvious solution is to redistribute work.

Roughly speaking, unemployment occurs when labor supply exceeds demand. As I mentioned, there are limits to our ability to increase demand, but because of our ability to decrease supply through government policy, it is hard for me to see high unemployment within prosperous societies as an excusable state of affairs.

Incentives to allow more flexible hours (2)

Above, I argued that the welfare of workers would improve if they were more free to choose the number of hours they worked per week. My intuition is that if work hours did become more flexible, people would on balance choose to work fewer hours rather than more hours. This would then open up some work to the previously unemployed. To me, this seems like a win-win outcome.

Shifting the health care burden away from employers (2)

Shifting the health care burden away from employers should help allow more flexible work hours, which, again, would hopefully decrease the supply of labor in such a way as to decrease unemployment.

Incentives to hire people for fewer hours

This approach is slightly more heavy handed than simply encouraging a climate of flexible work hours; here we are going one step further and supplying incentives in order to bring labor supply to the desired level. The obvious way to implement this is to simply put a tax (collected from the employers) on the labor of people who work for more than a certain number of hours, perhaps a graded tax that increases in percentage as the number of hours worked increases. For example, if there was an overtime threshold of 35 hours per week, and I worked for 50 hours at a given firm, the government could ask the employer to pay a tax of (15/50)*t*S, where t is a small constant (e.g. .05), and S is my weekly salary.

Instead of a tax, one could try to achieve the same effect by lowering the overtime mark, e.g. from 40 hours to 35, or perhaps having a series of graded overtime periods, with the more advanced period requiring a larger increase from the base rate. This approach might be a bit harder to enforce, as employers could in some cases lower the base rate of pay in order to compensate for the law, causing it to be ineffective.

Note that for both of these approaches, there is a simple method of closing the loophole of people skirting around the incentive by, for example, working two jobs for 25 hours each per week rather than a single job for 50 hours per week. The method would be to require the worker to put his hours for the week in a particular order. In this example of 25 hours each at two jobs, I as the worker could say that I was working my first 25 hours at job A (thus no tax or overtime on this work), and my next 25 hours at job B (thus 15 hours of overtime or tax given a threshold of 35).

Increased equality

I speculate that increased equality could slightly decrease the supply of labor, thus decreasing unemployment. My logic here is that an individual's willingness to supply labor generally decreases as their wealth increases, but that this effect is weaker for people with more wealth. Hence, the labor supply increase from people with above-average wealth who lost wealth to taxation might be outweighed by the labor supply decrease from those with below-average wealth who benefit from redistribution. However, this is all rather conjectural.

Tariffs on imports from countries with high inequality

If there are foreign countries where inequality is much greater, and thus where a large number of poor people are willing to work for almost nothing, what is the effect on the bargaining power of domestic workers? I'm honestly not sure if the benefits of this outweigh the costs, but I will raise the possibility of placing import tariffs on countries depending on their level of inequality. (As measured, perhaps by a Gini coefficient, but based on wealth rather than income.) One could try to weight the tariff by how much of the value of the product comes from labor.

Alternately, one could try to apply a tariff such that the post-tariff cost of an imported good is approximately equal to the cost of that good if the workers were paid a decent wage. (The definition of "decent" is of course a matter for discussion.)

In addition to serving as a means to shoring up worker bargaining power, this kind of policy may also serve as an incentive for foreign countries to decrease their level of wealth inequality and/or wage inequality.

Decreasing frictional unemployment

In addition to fiddling with labor supply and demand, involuntary unemployment can be reduced via a reduction in the time and effort needed to find a suitable job.

Improved government employment agencies

I suggest that the ambitious government employment program mentioned above would be a fantastic way to reduce frictional unemployment.

Improved job training programs
I also suggest that an increased investment in job training (also mentioned above) could help to fight unemployment, by helping in cases where the skill sets of available workers don't quite match up with the required skills for available jobs, resulting in unemployed workers and unfilled jobs.

Ecological health

I believe that if the health of the ecosystem deteriorates, all human experience deteriorates as a result. No matter how many gadgets we produce for ourselves, I think that human life will become a misery if we lose access to fresh air, fresh foods, clean water, and natural open space.

Furthermore, I believe that non-human creatures are capable of happiness and suffering too, and that the ecosystem shouldn't be evaluated solely in terms of its value to humanity. Of course, I don't suggest that we sacrifice our own species to make way for other animals, but I think that we should set aside as much land and sea as we can so that other creatures can enjoy the kind of life that they have enjoyed for thousands (or millions) of years. We can never say for sure whether human life is more or less enjoyable than the life of other creatures; thus I think that it's best to try to make both exist in health and abundance.

Resource use tax

The goal of this tax would be to make it so that to private cost to someone using a natural resource (whether for individual consumption, or as a factor of production) is approximately equal to the social cost. The tax should also be applied to pollution, so that the polluter pays the social cost of their pollution.

Of course, one cannot exactly determine the social cost of resource use or pollution, so the goal is to make the best possible approximation.

Tariffs on imports that don’t apply a resource use tax

Assume that a foreign country does not apply an adequate resource use tax, and that it sells a natural resource on the world market at a price that is below the social cost of its use. If our country applies the tariff, it ensures that the purchase cost of the resource to anyone within our country is equal to the social cost. Thus, the tariff should prevent our country from demanding the resource beyond its socially optimal level of use.

Reward organic and sustainable farming

I know very little about the agriculture industry, but I suggest that organic and sustainable farming may be getting too little government support, while less socially responsible agriculture giants enjoy too much government support.

Decrease animal cruelty in the meat industry

Because I believe that we should take the happiness and suffering of other animals into account whenever possible, I believe that the mass-scale suffering inflicted by the meat industry is unconscionable. I believe that much more strict laws should be enacted and enforced regarding the living conditions of livestock. I believe that they should, by law, be given a living environment that allows them freedom of movement, fresh air, sunlight, etc.; that is, whatever is necessary for them to have a reasonably pleasant life.

Of course, this would cause the price of meat to increase, but in my opinion, this is a good thing. I'm certain that if you take animal suffering into account even a little bit, the current price of meat comes nowhere near to reflecting its actual social cost.

Worthwhile production

Since I was 15 years old, I have been fascinated by the question of how we can judge whether a given product or service is ‘worthwhile’ (in terms of its social benefits outweighing the social cost of production), and whether we can make policy decisions that help to curtail production not meeting this standard. (Conversely, I’m interested in systems that more consistently encourage ‘worthwhile’ production, e.g. public goods.) I suspect that natural resources and labor are often undervalued (in that their monetary cost does not fully reflect their social cost), and I would like to find ways to valuate them more appropriately.

Increased equality (4)

I argue that if you redistribute wealth from the rich to the poor, the result is that less money (i.e. fewer resources) will be spent on luxury items, and more money will be spent on basic necessities. In a way, this is similar to the argument that wealth has a decreasing marginal utility (which I mentioned above). Willingness to pay for a good is often used as the primary indication of that good's social value, but the distortion of high inequality makes this a less valid measure. For example, imagine that a millionaire is willing to pay more for a high-definition television than a poor family is willing (that is, able) to spend for life saving medicine or food. Anyone who is not completely, cynically relativistic should concede that the medicine has a greater social value than the TV, despite the lower willingness to pay. Greater equality should help to correct this imbalance, so that willingness to pay is a more legitimate measure of social benefit, which in turn helps us to use market economy to discourage production that is not worthwhile.

Furthermore, if increased equality leads to higher wages via improved worker bargaining power (and if there is a more fluid tradeoff between leisure and labor), I suggest that the cost of employing labor will more accurately reflect its social cost.

Resource use tax (2)

As mentioned above, the goal of the resource use tax is to avoid situations where the social cost of a product is greater than the social benefit, but the purchase price is less than the social benefit due to under-valuation of resource. (PP<SB<SC) If a resources is used in this manner, it is an example of non-worthwhile production. In these cases, the tax aims to set the purchase price equal to the social cost (SB<PP=SC), thus bringing purchase price above social benefit, and causing the non-worthwhile production to not occur.

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