Policy potpourri

Here are ~32 ways in which I think US policy could be better.

Many of these are unrealistic changes. In some cases I think there is a corresponding marginal change that we should advocate for, but in some cases it’s just wishful thinking. You should read this post in the same spirit that you’d read a post about board games.

This list is written from a “dealist” perspective: I am trying to find policy changes that would leave almost everyone better off. If I was instead writing from a long-run utilitarian perspective, I would make much more dramatic recommendations.

I know only a little bit about each these areas, so many of my views are likely wrong and will change as I learn more. I would have put “I think” or “I suspect” in front of every sentence, but that got tedious. (I think that this list is mostly relatively orthodox amongst economists, though that doesn’t stop them from being wrong.)

Taxes

We should mostly raise revenue via efficient taxes, particularly progress income taxes, consumption taxes (probably via VAT), and land value taxes. We should impose Pigovian taxes wherever appropriate and err on the side of overestimating externalities.

We should eliminate inefficient taxes (especially capital gains and corporate tax) even if they are more progressive than consumption taxes. We should usually achieve our desired level of redistribution by implementing efficient redistributive programs instead of inefficient progressive taxes. In some cases lower levels of inefficient but progressive taxes can outperform higher levels of regressive taxes, but for things like capital gains or corporate tax that seems quite unlikely.

Means of redistribution

Whatever level of redistribution we want, we should mostly reach it by handing people money; other policy decisions should be made primarily on the basis of (Kaldor-Hicks) efficiency, only modestly overweighting the welfare of less-well-off beneficiaries (with the maximum ratio corresponding to the social cost of raising $1 to fund more redistribution, which I expect is between $1 and $1.50). I expect that other spending will be redistributive on net, somewhat decreasing the need for direct transfers, but that direct transfers should still be a majority of the total redistribution.

Moving away from means-tested welfare would involve large tax increases. In practice we’d likely implement this as an income tax deduction (with many families now paying negative income tax), rather than having people separately giving and taking money from the government. The average tax burden wouldn’t change, but it would now be a more steeply increasing function of income (though there would be no implicit tax from benefits phasing out).

We shouldn’t pay people more if they live in areas with high cost of living. There is some luck-of-the-draw in where you are born that we’d like to insure against, but realistically that seems small compared to incentive effects, and it is much more efficient for welfare beneficiaries to move away from key economic centers.

Realistically if we implement redistribution via cash transfers then we probably need to ensure that bankruptcy is available for all debts, to limit the harms from borrowing against future transfer payments.

A common theme in this post will be: stop inefficient redistribution, instead raise taxes +  increase transfer payments. I expect people on both the left and right will dislike this. (The other side will never give an inch on inefficient policies that benefit them, so we can’t give an inch on inefficient policies that benefit us…) As part of the ideal policy package, I’d want to lean more heavily on legislation that explicitly compromises. One kind of compromise is including some changes that increase and some that decrease overall redistribution, to increase efficiency while preserving overall redistribution, though I understand this is extremely difficult in practice. I also understand that large increases to taxes + transfers are not politically realistic even if the redistributive effects are offset elsewhere, but I do think that elites on both sides should push for marginal changes in that direction.

Interlude: levels of redistribution

I’d prefer the total amount of redistribution be in the ballpark of each person receiving ~$28,000/year (50% of per capita GDP) in total government benefits (including public services) with costs allocated based on ability to pay.

I don’t have a strong view about levels of redistribution between say 40% and 70% of GDP. Lowering redistribution far below 50% starts to have very large welfare costs with only modest gains for incentives/”just desserts,” while raising it too far above 50% starts to create large distortions without correspondingly larger welfare gains. I expect that reaching 50% redistribution would require government spending around 50-60% of GDP (currently it’s 40%), at least if we wanted to maintain current defense spending.

Public goods

For many goods, the efficient price is too low to incentivize private production (private providers would charge a high price that resulted in underutilization): roads, transit, parks, infrastructure with economies of scale, and information goods like research, drugs, or media. In these cases there should be a mild presumption in favor of state provision or subsidies. There should never be bans on private competition—using a state-granted monopoly to subsidize an industry is much less efficient than subsidizing it directly.

Many goods are partially rivalrous—there are economies of scale and so the efficient price is too low to incentivize production, but also one person using the good hurts other users. We should typically charge a congestion price that actually reflects the externality. For example, the state should charge market-clearing tolls for roadways and subway systems (which will often be very low off-peak and relatively large on-peak). Charging a lower price and using queueing or lotteries may have some positive redistributive effect, but is also colossally inefficient.

I’d like to see states make estimates for the public value that these services are delivering, and closing them down if those estimates are lower than the cost (or auctioning off resources like roads and parks if the amount the private sector is willing to pay is more than those estimates). It’s OK if those estimates tend to be too optimistic, that would be much better than nothing.

Other public services

We should mostly redistribute via efficient cash transfers rather than in-kind transfers. If we are concerned that poor people make bad consumption decisions then it seems better to use nudges where possible; for example, people with low incomes might receive “default” health insurance, savings programs, or subsidized housing, but recipients should have the ability to opt out in favor of cash transfers which they can use as they see fit. As a general rule I don’t think we should try to override firmly expressed preferences of beneficiaries except when there is a very strong argument.

State services (including those aimed at poor recipients) should mostly compete on the market rather than receiving subsidies. If services can’t compete on the market, they should shut down.

Regulation and consumer protection

Regulators should ban products (and require vocational licensing) less often than they currently do. Marginal regulation today seems to be net harmful on average. (Often debate on the internet turns to whether regulation on net is good or bad, which is only really important if you are an ideological libertarian. Scaling down regulation on the margin is much more likely to be a good idea than dismantling entire regulatory agencies.)

In many cases regulators could replace bans with mandatory “would have banned” labeling laws, letting consumers know that regulators believe products are unsafe or ineffective. If we wanted to continue being relatively paternalistic rather than trusting consumers to make a decision about whether they think regulators are adding value, we could restrict would-have-banned products to “accredited consumers”—e.g. if you wanted to get your hair cut by an unlicensed barber, you could be forced to take a qualifying exam where you answer questions about the risks presented by unlicensed barbers and the nature of licensing requirements.

Where regulators do want to ban products and harmonization isn’t too important, we should prefer ban different things in different places so that we can continue to learn about products that we expect should be banned. Banning a product in 95% of places probably captures about 95% of the value of banning it outright; allowing it in 5% of places captures much more than 5% of the useful information from allowing it, especially if you randomize.

Regulation and externalities

Where possible regulators should impose taxes rather than banning behaviors. Taxes should be based on estimated externalities. We should err on the side of overestimating rather than underestimating externalities, since taxes also raise revenue and so allow us to lower other taxes.

We should separate agencies responsible for monitoring/enforcement and the agencies responsible for estimating externalities. E.g. we should separate the branch of the EPA that enforces environmental law and the branch that estimates social costs.

In general, we should be more willing to compensate the losers from regulatory changes, e.g. paying oil companies for the losses in value when carbon taxes are increased. This kind of compensation should be based on a conservative underestimate for the actual cost. If firms made investments after the social costs should have been clear, then there should be a weaker presumption in favor of compensation.

Regulation and mistakes

Many regulations that don’t address significant externalities or have a coherent paternalistic justification. Most price controls are a bad idea, price gouging should probably be legal, a lot of licensing has no plausible consumer protection justification, any time a regulator is setting a lower bound on prices it’s a really bad sign, etc. Forms of gambling that clearly don’t exploit problem gamblers (e.g. prediction markets involving accredited investors) should be legalized. Prostitution and organ markets should probably be legal.

In general proposed regulations should be supported by credible arguments that they would improve public welfare, and those arguments should be held to a higher standard than they are today. Some of the big failure modes here seem to be economic illiteracy,  concentrated interests that push for self-serving regulation, and well-meaning people who are indignant but don’t fully understand the area; higher standards for arguments for regulations would help curb those problems, including protecting individuals from firms that invest in lobbying.

Financial regulation

We should make a serious effort to let banks fail when they make bad or unlucky decisions. If we were able to make this change (which is harder than it sounds), then we could significantly weaken regulations on banks while probably having a slightly more stable financial system in the long run.

We should generally allow accredited investors to sign whatever crazy financial contracts they want; the SEC does not seem good at understanding which financial instruments could potentially create value, and they probably shouldn’t be in the business of making those decisions (and should instead focus more on preventing fraud, misrepresentation, and clear abuse). They can use “would have banned” labels too if they think that some contracts are a bad idea. It should be easier for people with moderate savings to become accredited investors.

Sovereign wealth fund

When governments can borrow cheaply, they should probably take the opportunity to borrow and invest. For example, the government currently borrows over 30 years at real interest rate of <1% / year, which seems well below investment returns over the next 30 years (current stock yields are >3%, high-quality bonds are around 2.5%). A $10T domestic investment would make the US government own about 10% of the stock market and 10% of the bond market, and would net something like 2%*$10T= $500B/year of revenue, around $1,500 per year per citizen.

As long as a sovereign wealth fund is a modest fraction of the total market, it could be managed passively without much efficiency loss. Realistically this is probably the only way to avoid a huge mess. A large passively managed wealth fund would definitely drive up returns in finance by effectively outsourcing management to the financial sector. Probably a larger effect would be depressing returns to capital and increasing returns to labor.

Owning something like 10-15% of the stock market would have dramatic effects, so you’d want to introduce such a policy gradually. In practice the total upside is probably not large enough to outweigh the considerable risks of mismangement or something unanticipated going terribly wrong, so you’d want to stop before getting up to levels this large even if everything seemed to be going well.

Minimum wage, labor laws, unions

A minimum wage transfers some wealth from capitalists to workers. But it appears to be very inefficient compared to taxes+redistribution. There is a lot of debate about whether the minimum wage costs enough jobs that it is an obviously terrible policy (it probably doesn’t), but there is little debate about whether it costs enough jobs that it is worse than taxes+transfers (it probably does). The cost of the minimum wage is quadratic in the distance from the market-clearing wage, so we should be especially unhappy with large minimum wages (I consider the enthusiasm for a $15 minimum wage one way in which the left in the US has gone off the rails). Minimum wages slightly above market-clearing wages can be efficient for the same reason, but in light of labor market frictions (that “barely employed” people are not in fact indifferent about losing their jobs) I think raising existing minimum wages is usually a bad idea. (Though Sanders’ “Stop BEZOS” proposal is way worse.)

In the absence of a minimum wage, most labor laws are probably inefficient. In a reasonably functional market the employer has a choice between offering lower benefits or lower salaries, and the employer’s choice here is basically aligned with social interests—they should offer lower benefits if and only if employees prefer the money to the benefits. If you find it distasteful that employees would prefer the money, then redistribute more, most labor law isn’t an efficient form of redistribution though. Similarly for job stability and unemployment insurance. (Of course if you have a minimum wage you are effectively forced to regulate every aspect of minimum wage jobs. That’s another reason to prefer transfers to a minimum wage.)

Unions probably shouldn’t receive special legal protections; improving the bargaining power of workers has good redistributive effects, but probably leads to less efficient employment contracts. I don’t have a strong view on right-to-work laws, or on the more general question of whether unions should be regulated as cartels; I think this would probably improve efficiency, but the gains might be small and there would be other costs.

Health care

We’d like to redistribute money from healthy people to sick people (for similar reasons that we’d like to redistribute from wealthy to poor), at least in cases where there is no moral hazard. Private health insurance can’t really do this for pre-existing conditions. It’s hard to directly transfer money from healthy to sick people, since it will introduce incentives to look sick. Transferring health care to sick people is more attractive because then if you fake being sick all you get is some health care that you didn’t actually need.

I think the total welfare gain achievable by this kind of redistribution is not huge; in particular, I think it’s small relative to the size of health care spending in developed countries, suggesting that we should mostly optimize health care for efficiency rather than prioritizing this kind of redistribution. Even as such, it probably makes sense for the state to give sicker people money to cover healthcare expenses.

In general the costs of subsidized healthcare grow a lot as you approach 100% of costs (since consumption choices become increasingly inefficient), and the benefits don’t grow correspondingly, so it’s probably not a good idea to try to get to 100% coverage rather than to just view the policy as softening the blow of pre-existing conditions. It doesn’t seem efficient for the state to provide health care itself. I’d prefer structure transfers by choosing a list of conditions to reimburse and a total reimbursement for each, and then reimbursing a fraction of medical costs up to that limit.

Criminal justice

We should be significantly more liberal with bail and parole. We should probably have more lenient sentencing across the board. We should use criminal fines more extensively, since they are a form of punishment with very low deadweight loss, though we should adjust fines to make them more appropriate as a punitive measure—they should scale with the income or wealth of the accused, and revenue should not go to the jurisdiction that collects the fine.

Monetary policy

I think that the central bank should print enough money that (nominal) gross national income follows a steady and predicable trajectory, say growing by 5% / year + population growth. We should subsidize forecasts of gross national income to help the fed hit these targets, e.g. by issuing bonds linked to GNI or subsidizing prediction markets.


4 thoughts on “Policy potpourri

  1. These don’t seem like compromise policies to me. In fact many of them utterly horrify me, such as the suggestion that the state shouldn’t provide healthcare – the NHS works far better than the US system. I don’t think you can treat them like some kind of good-for-everyone net improvement when many leftists would get angry enough to just leave the room if you proposed them!

    When you started talking about how unions shouldn’t have special protections because it might make employment contracts inefficient, I did a double take. As a person on the left, I do not want efficient employment contracts. I do not want human beings to be forced to work eleven hours straight in Amazon factories where they aren’t allowed to speak or use the bathroom for the sake of “efficiency”. If that’s efficiency, then I guess I hate efficiency and everyone who stands for it. You appear to be under the impression this is some kind of mid-ground, but all the appeals to efficiency are straightforwardly right-wing.

    You fundamentally assume a bunch of things which many leftists don’t believe – eg. that markets are a good way to run society, that they can be more efficient than state control, that right wing economic theories are true despite being based on a ridiculous “Homo economics” which has never existed, that welfare can be sensibly quantified in money and someone with a clipboard can be qualified to do so, etc etc.

    It strikes me that you need to have a conversation with a sensible defender of labour laws, as opposed to someone who just wants them because otherwise people might be mean. No employer has ever sat down and made a rational choice between providing higher benefits and a higher salary based on a sensible model of what employees on the market want. Benefits like flexible working hours can provide significant value to the employee, cost the employer nothing (or even increase profits through increasing productivity), and still fail to be offered due to a working culture which sees arriving at 7am in the morning as a presenteeist badge of honour. Widespread sexism causes employers to consistently make irrational decisions. It costs an employer nothing to allow a disabled employee to bring their own peripherals to work, but many will force a disabled employee to use standard work computers because they don’t recognise the disability as legitimate and they instinctively slap down any perceived request to be treated as special. Benefits like generous sick leave and paternity/maternity leave also have huge positive externalities – they prevent other non-consenting individuals from getting sick and help avoid substandard care of infants.

    A proposal that people shouldn’t receive more welfare if they live in areas with higher cost of living is going to make a lot of people’s blood boil. Someone who may have lived in that area for many years, or whose family may have lived in the area for generations, gets a lot of value from staying in that area – it’s what they know, their entire support network is here, they’re safe and understand the dangers in their part of town, they probably have numerous high-trust arrangements with other locals which are incredibly valuable and which they absolutely shouldn’t be forced to move away from for the sake of “efficiency”. Being able to get free childcare from one’s neighbours because you grew up together and your parents did the same is extremely valuable, and being forced to move away destroys all this value. Moving, for many people with strong attachments to place and/or who find it difficult to build up new support systems from scratch, can be one of the most stressful events in people’s lives. I realise many highly-mobile urbanist elites don’t recognise the existence of this kind of value, but they should really hesitate before destroying it all.

    This seriously just reads like the average market libertarian set of beliefs. I don’t see any compromise or attempt to make policies which would be good for everyone.

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    1. I do not want human beings to be forced to work eleven hours straight in Amazon factories where they aren’t allowed to speak or use the bathroom for the sake of “efficiency”. If that’s efficiency, then I guess I hate efficiency and everyone who stands for it.

      I’d like to better understand the details of your view (and others’ views) here. It sounds like you think that employment on better conditions would be worth more to Amazon employees than it would cost to Amazon, such that everyone would be happier if Amazon offered lower wages and better conditions. Do you think that Amazon is making a mistake, and could improve their bottom line by offering those terms ? Do you think that employees are making a mistake, and would reject the deal even though it would be better for them?

      (Is the minimum wage binding for the employees with the worst conditions? ETA: after looking into it briefly, I think they make more than minimum wage. Also after looking into it sounds like Amazon is probably making a reasonable tradeoff, but I remain curious about the common leftist view here.)

      If instead you think employment on better terms would be worth $X to employees and $Y>$X to Amazon, then presumably everyone would be happier if they increased pay by $Y rather than improving terms. In this case, it seems fair to say that they should not improve the terms, since every option with better terms is dominated by one with worse terms. But I can see various more subtle (or non-consequentialists) objections to that position.

      You could think that it’s important that we get Amazon to pay the extra $Y or improve terms. Making them pay the extra $Y seems better. But at that point, if we are going to redistribute money from rich people to poor people I don’t see why we’d want to take $Y from Amazon and give it to Amazon employees, rather taking from rich people to give to poor people—that’s just focusing your redistribution on some random class of beneficiaries (who probably aren’t even the most needy) and penalizing Amazon for employing poor people. I can imagine why you might want to reward working people in particular, either to improve incentives or because they “deserve” it, but that doesn’t sound like your position.

      I think this basic argument is one of the most important points of departure between people with leftist leanings and people with left-libertarian leanings. (By “left-libertarian” I mean “libertarian but with a strong welfare state and environmental protections.”)

      You appear to be under the impression this is some kind of mid-ground, but all the appeals to efficiency are straightforwardly right-wing.

      I said I think these policies would be improvements for the great majority of people, not that they are a compromise between many different peoples’ views. Naturally these policies reflect my own views. I think lots of people disagree strongly with them (and in general they are unpopular policies except amongst economists), for now I think those people are wrong but like I said I could imagine my views changing based on learning more or hearing good arguments.

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      1. Sorry, I think I was unnecessarily heated there – based on words like potpourri and dealist, I thought you were trying to propose deals that involved bits of policies from all sides, so was annoyed to see straightforward libertarianism. With more context I think this is a reasonable post, though I still disagree with almost all the proposals.

        I think the state is not even close to being the source of the most unpleasant coercion in most people’s lives. (Specifying “unpleasant coercion” because while the state may threaten to imprison me if I rob stores, thereby coercing me to not rob stores, I don’t experience this as unpleasant because I didn’t really want to rob stores anyway.) Other sources of coercion can be things like “my parents will disown me if I don’t get a respectable job”, “my girlfriend is threatening to leave me if I don’t do more of the chores”, “my husband will beat me up if I speak to my male friends”, “a loan shark is threatening to break my legs if I don’t pay them more”, “I depend on financial support such as scholarships or charity provision with strict conditions about what I can buy and how I can act”, or “my friend will publicly mock me if I don’t help with his project”.

        It’s really common for employers to exert extremely unpleasant coercive force, such as threatening to fire employees if they don’t work overtime for no pay. Technically this is illegal, but employees don’t have the resources (legal fees, expertise, time and energy) to challenge these practices in court. It’s also really common for not-having-a-job to just not be an option, either due to ineligibility for sufficient state support to survive or due to coercion from relatives/partner/friends/church/loansharks/whatever.

        Assumptions about efficient markets, like “if they preferred not to have a job at Amazon then they would get jobs elsewhere, and Amazon would have to improve in order to attract employees” just do not apply to the minimum wage job market. The minimum wage job market doesn’t deserve the name “market”. Employees have extremely limited information, plus they’re often deceived by employers misleading them about the hours they’ll work or the benefits they’ll get (since hours are often higher in practice and benefits often fail to materialise). It’s extremely rare for people to be in a position where they can choose not to participate. There’s no shopping around – if you’re a poor worker who just lost their job and doesn’t have any savings and won’t be able to feed their children next week, you’re going to take the first offer you get no matter how bad it is (and your job is then frequently tiring or time-consuming enough that you can’t apply for any others while working). Low-skill jobs find hiring relatively easy, and don’t have to compete for specific kinds of employee. Companies don’t suffer a reputation hit if they fire employees, but an employee who is fired (or who refuses work and therefore has a gap on their CV) can suffer permanent consequences to their ability to get hired for other jobs. Your employer can demand that you move to a different city or even a different country, alter your sleeping patterns, control what medications you can take, isolate you and micromanage your every action for the majority of your waking hours; in response, you can…. make sad faces?

        Amazon is not in any kind of competition for workers. Amazon will offer the absolute worst pay and worst terms that it can legally get away with, and a huge number of people will be coerced into working there anyway. In order for many poor unskilled people to prefer unemployment over Amazon, the working conditions would literally have to be worse than watching your children starve or your elderly mother die of cancer (at least in countries like the US where the welfare system is massively insufficient, can take longer to get on than most people have runway, doesn’t provide medical care and is completely unresponsive to anyone with unusual needs). It is quite difficult to make a job bad enough that people prefer watching their family suffer and starve and be homeless and die, but if it wasn’t for regulations then Amazon would be damn well trying.

        I don’t know exactly how wages trade off against conditions – my impression is that working conditions correlate more strongly with happiness than wages, but I’m not in the mood for a meta-analysis and I suspect that the wage-happiness curve is very steep at the beginning and levels off later. I definitely believe that Amazon could offer better working conditions at a cost to itself far far lower than the benefit to its workers – it costs almost nothing to let someone have a five-minute bathroom break and they’ll probably be more focused and productive if you do. However, my argument isn’t that Amazon should offer lower wages and better conditions – they should offer the same wages and better conditions. That would hurt their bottom line, but I don’t care about Amazon’s bottom line nearly as much as I care about the welfare of their employees, and I think it would only hurt the bottom line a very small amount while providing a very large benefit to the employees. There’s just no incentive for Amazon to reduce its profit by any amount, no matter how small, in order to increase human welfare – therefore we have to regulate that they should do so.

        I don’t believe that Amazon would offer better conditions if they were allowed to offer lower wages. Amazon isn’t deciding how much it’s willing to pay to attract good employees, then deciding how to distribute that between providing wages and providing good working conditions. Amazon is just doing whatever it can to minimise how much it pays employees, and if it could legally use slave labour then it would do that.

        If it helps with the intuition, imagine someone arguing, “I don’t think we should have legislation that forces slave-owners not to whip their slaves. If the cost to slave-owners of whip-free slavery is higher than the benefit to the slaves, why not just tax slave-owners and give the slaves some money? Redistribution just seems more efficient than outlawing people from keeping slaves in chains.” It sounds ridiculous. People should pay their workers AND they shouldn’t be allowed to whip them, and market-type reasoning doesn’t apply when there’s such a big power differential.

        I have heard a lot of arguments that we should just figure out how many dollars the improved working conditions would be worth to employees, and use efficient taxes to distribute that many dollars to them. I think this is also making a fundamental mistake by assuming that markets for what people want exist and are efficient. It’s not possible to measure the worth of everything in dollars! Currently I would quite like fried salmon delivered to my door, but the price may as well be infinity dollars – the only takeaway restaurants in delivery range are Indian and Chinese and Turkish places, none of which do fried salmon. I guess in theory if enough people in my area wanted fried salmon and were willing to pay for it then someone would set up shop and start selling it to us, but in practice nobody knows about my desire for fried salmon except the readers of this comment (none of whom are likely to immediately quit their jobs so they can set up a fish shop in my particular part of London).

        Many of the things people want are things they cannot buy. Perhaps I value [my boss refraining from spitting in my face] at £50, as in I would be willing to pay £50 to make it happen. If you legislate that my boss isn’t allowed to spit in my face any more, then I get what I want, and my boss pays the relatively low cost of having to restrain himself when he feels the desire to spit in my face. If you pay me £50, then I’m happier than I was but I’m still not capable of buying the product [my boss not spitting in my face]. That product isn’t available on the market. There’s no way to effectively bind my boss to a contract where I pay him £50 and he doesn’t spit in my face, there’s no way to quickly and costlessly find a job which is identical to my current job except it pays £50 less and has zero face-spitting, and anyway I might be coerced by my parents/relatives/friends/spouse/charitable-funding-provider/creditor/local-gangsters/landlord into spending that £50 on something I want less.

        (As a personal example, one of the things I want is quiet. I can’t buy quiet. I can’t pay a little extra for a home and get a guarantee that nobody will ever begin demolition works in audible range. I might be able to pay a neighbour £10 in exchange for practising their instrument at times when I’m out, but I can’t feasibly set up a system that automatically pays local teenagers £10 if they agree not to drunkenly scream while passing my window. Quiet is not a product on the market, at any price, so it doesn’t really matter how much I’d be willing to pay. The only way for me to get it is through noise regulations.)

        We should redistribute money to poor people, and that’s a good start, but we should also try to use legislation and regulation to provide them with the things that they can’t buy with money. Things people cannot buy with money, or can’t effectively/informedly/reliably buy with money, include good working conditions and healthcare and understandably-written contract terms and stability and safety and a bunch of other things. (Safety: a jilted ex intent on stabbing me is unlikely to take my offer of £100 in exchange for not stabbing me, and will probably steal my £100 anyway after he stabs me.) If I can’t buy something with money, then providing that thing to me is much better than giving me the amount of money which I’d be willing to pay for it.

        I’m aware that lots of economists would support the positions you outlined above. I worry that the entire field of economics (with the possible partial exception of some subfields in behavioural economics) is based upon ignoring all of the considerations I’ve just discussed. Economics starts with the assumption of rational free independent agents making costless transactions using perfect information, and then makes lots of beautiful equations describing what the world might look like if it was even remotely similar to the world they describe. They pat themselves on the back because their theories are good at describing how public stock markets operate, which of course they would be – public stock markets are the one and only part of the world that looks anything like the world of Homo economicus (extremely high liquidity, lots of very smart people using cutting-edge software to make very fast trades, requirements for lots of public information, enough money and power involved that illegal coercion or deception is actually discovered and prosecuted, etc). The vast majority of companies are privately owned and the vast majority of people would be lucky to have even a fraction as much knowledge about their day-to-day transactions as public stock traders know about theirs. It’s notable that economics courses tend to produce right-wing graduates, but every other science and field of human inquiry makes people tend to get more left-wing the more they’re educated. It’s also notable that plenty of economists are very good at making beautiful equations, but can’t predict what their shopping order will come to let alone the effects of a national policy change.

        On the factual question, I’m surprised that you think Amazon employees make more than minimum wage – I’ve looked into it a bit more, and my impression is that the lowest tier workers actually make less than minimum wage and Amazon gets away with it on various technicalities (eg. not counting time for security checks as working time, or having employees technically be allowed to take breaks but strongly incentivizing them not to do so). I’d like your sources on Amazon paying lowest-tier factory employees more than minimum wage – you might have seen some of the Amazon propaganda (they’ve been paying “ambassadors” to post on the internet about how much they love their jobs).

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