What practices have resulted in things being the way they are now? These practices are largely attributable to businesses whose policies are endorsed and enacted through government. Government politics are a complete morass and you've done an excellent job of painting how various parties might try and solve the problem.
So if government is a morass, how do you approach the problem? Certainly a career in politics is out of the question based on this presupposition. One might consider simply adapting how they act in their daily interactions with others. Personally I think this idea is too small-scale.
In my opinion, one strategy would be through the business side. Create a business whose policies create the type of change necessary for closing the gap between the mega-rich and "middle" class. The argument has been made in this thread that in order to compete, it is impossible to instate these types of policies. However, I believe this to be a false assumption. Certainly companies, even large ones, fall into a spectrum of "good" and "bad" practices. There appears to be no bound to either side. I take the David Deutschian view that any problem can be solved with the right knowledge¹. So the question is, can we think creatively, critically, and intelligently enough to solve this problem in business?
I believe the answer is yes.
¹ EDIT: Any problem whose solution is not explicitly prohibited by the nature of reality.
I don't know that it's a panacea, but at least pertaining to labor laws, Trader Joe's is fairly well regarded.
A couple of simple rules that would take you a very long way towards being the "right" kind of company:
- Pay better than minimum wage. Pay a lot better than minimum wage, in fact; even for the lowest employee.
- Pay your highest paid executives less than we're used to seeing. I don't know why, but people just absolutely hate it when CEO of such and such is making $x million dollars a year, while the cashiers of so and so are absolutely starving on minimum wage. Cap executive wages to some multiple of the lowest wage. If the CEO wants to make a $10 million a year, then the janitor would have to make $1 million a year; as an example.
- Don't cap employee position pay. Have starting wages, of course, and make them generous, but if a cashier has been with you for 172 years, she should have received raises (assuming they were merited) every year, or be let go, if she didn't merit them.
- Don't lobby Congress for personal / business gain. I've argued it extensively elsewhere on HN recently, so I won't go into it again now, but I think that people's problems with capitalism aren't actually complaints with capitalism, but a complaint with the crony capitalism that we have in America. IBM lobbies for increased patent protections, makes a billion dollars, pays the guy who thought of it $10 million, and now everybody hates IBM, and especially that guy. If the system were both fair and fairly applied, sure, the Fishtowners might complain, but there would be more in the way of income mobility for the motivated, which should elevate the lower class to a true middle class for those willing to earn it, which would act as a bulwark against unruliness.
When Warren Buffet complains that he's being taxed too little, the cynic in me thinks that he wants his less rich competitors to be taxed out of being able to truly compete, while he enjoys his largesse, knowing that no amount of taxation would really have any impact on his lifestyle. For as generous as progressive seems when taken away from the uber-rich, it actually is a penalty for those just on the cusp of wealthy, and keeps them stuck in middle class without an effective means of pushing past it.
I absolutely agree with almost everything you've said here. You've essentially described the kind of company culture I want to build.
In particular, you nailed it when you talked about the difference between "capitalism" and "crony capitalism". I personally do not have a problem with capitalism in its pure form (as I understand it). At the risk of sounding like I am parroting a platitude - perhaps I am - I think that capitalism is too often understood to be a zero-sum entity.
I believe that the best way to do this is to set a standard of ethics by which you operate your company and then to be as successful as possible within that context. Be competitive; don't use competition as an excuse to contribute to the American economic divide.
And now I really will parrot the Buckminster Fuller quote that many people are intimately familiar with:
"We must do away with the absolutely specious notion that everybody has to earn a living. It is a fact today that one in ten thousand of us can make a technological breakthrough capable of supporting all the rest."
All around the world, educated women with a first-world standard of living are the weakest producers of babies humanity has ever known. Wealthy, educated people simply don't overpopulate.
"For as generous as progressive seems when taken away from the uber-rich, it actually is a penalty for those just on the cusp of wealthy, and keeps them stuck in middle class without an effective means of pushing past it."
That is assumption somewhat based on the current marginal tax brackets. There would be no reason that a progressive tax could not be designed so that moderately wealthy individuals would pay
a similar effective tax rates compared to the "middle class", and then require the to X% pay significantly more (those earning more than say 10 million, for example).
Or better yet, do as Warren Buffet himself proposes, which is harmonizing the capital gains and marginal tax brackets such there is a flat effective tax for all income levels. Buffet generally argues that he and his secretary should be paying the same effective tax rate, not that high-income individuals should be coercively taxed. (funnily enough, President Reagan made an identical argument comparing a secretary's tax rate to their boss).
A flat tax could potentially be lower for most or all taxpayers, there's nothing in it that requires it to increase the tax burden.
I see it this way:
What practices have resulted in things being the way they are now? These practices are largely attributable to businesses whose policies are endorsed and enacted through government. Government politics are a complete morass and you've done an excellent job of painting how various parties might try and solve the problem.
So if government is a morass, how do you approach the problem? Certainly a career in politics is out of the question based on this presupposition. One might consider simply adapting how they act in their daily interactions with others. Personally I think this idea is too small-scale.
In my opinion, one strategy would be through the business side. Create a business whose policies create the type of change necessary for closing the gap between the mega-rich and "middle" class. The argument has been made in this thread that in order to compete, it is impossible to instate these types of policies. However, I believe this to be a false assumption. Certainly companies, even large ones, fall into a spectrum of "good" and "bad" practices. There appears to be no bound to either side. I take the David Deutschian view that any problem can be solved with the right knowledge¹. So the question is, can we think creatively, critically, and intelligently enough to solve this problem in business?
I believe the answer is yes.
¹ EDIT: Any problem whose solution is not explicitly prohibited by the nature of reality.