Policy Change Is Needed To Make The Economy Fair For All

We do not have an economy that is fair for all, and provides economic opportunity for all Americans. That is just a fact, and has been since the Republicans instituted their "Trickle-Down" economic policies (which says that giving more to the rich benefits everyone).

The rich are getting much richer, and the bottom 90% struggles vainly to maintain their buying power. And as the bottom 90% loses ground, a vast (and growing) gap between the rich and the rest of America has been created.

It does not have to be that way. When we had a more sensible economic policy, this country created a large and prosperous middle class (which is now shrinking). With better policies, we could do that again. We are the richest nation in the world, and all citizens should be able to share in that -- not just the rich.

The Economic Policy Institute has published a policy agenda to create a better and fairer economy. I highly recommend reading it. Below, I post just some of it (which I think must be tackled first):

UNIONS

Update the law to (1) authorize meaningful penalties against employers who interfere with workers joining together to improve their wages and working conditions; (2) impose monetary penalties for violations in which a worker is illegally terminated; (3) impose liability on corporate directors and officers who participate in violations of workers’ rights or have knowledge of and fail to prevent such violations; (4) prohibit employers from requiring that employees attend meetings designed to persuade them against voting in favor of a union; and (5) allow workers to bring a lawsuit to recover monetary damages and attorneys’ fees (private right of action) when their employer acts unlawfully to oppose their right to join a union and collectively bargain.

MINIMUM WAGE

Pass the Raise the Wage Act, raising the federal minimum wage to $15 per hour by 2024, indexing it to the national median wage thereafter, and phasing out the tipped minimum wage and other subminimum wages. Given inflation expectations, $15 in 2024 would be around $13 in 2018 dollars, an appropriate level for the federal floor. In addition, states and localities with higher costs of living should legislate higher minimum wages.

TAX REFORM

Raise the corporate income tax rate and close loopholes in the tax code to shore up the corporate income tax base—for example, by reining in corporations’ ability to shift profits overseas. Policymakers can also experiment with ways to include incentives in the tax code for corporations to grant wage increases.

Implement a financial transactions tax (FTT) to clamp down on wasteful Wall Street speculation and rein in the power of the financial sector. Even more than in most policy areas, the details regarding implementation of an FTT are key—for example, tax rates would need to differ depending on asset types and maturity to reduce the likelihood that managers could avoid the tax by shifting funds between asset classes. For quick reference, the revenue-maximizing benchmark rate on equity trades for an FTT has been estimated to be just over 0.34 percent. But given that there are benefits from an FTT besides just raising revenue, the revenue-maximizing rate should not constitute a de facto ceiling on rates.

Raise top tax rates on wealth-based income to narrow the gap between these rates and those imposed on income from work. In addition, radically upgrade tax enforcement and close loopholes that allow the wealthy to avoid even the low taxes they owe and to pass on bequests and gifts entirely untaxed.