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Opinion: 'Middle-Out' A Pirate Solution For The Economy?

 

I'm basically a moderate conservative who sees the need for a well-funded welfare state governed by and for the people via a decentralised, distributed democratic process. My personal motto is,

"The individual must be free to act and the will of the people must be respected."

If this principle is not at the core of every policy those policies will fail. The needs and desires of BOTH the many and the one must be kept in balance, with neither gaining the advantage over the other if we want a fairer world. It's the reason I don't vote for the major parties; each of their philosophies tends towards nanny-knows-best authoritarianism and I don't like being told what to do by people who don't care about me.

At the moment, we're caught between the Left/Right dichotomy with either Socialism or Free Market Supply-side ideologies being touted as the solution despite neither of them ever having been proven to work in practice. Middle-out is a departure from both and would create a more inclusive society by providing incentives for production, rewarding labour, and funding a robust welfare state. Let's take a closer look at it.

The Principle

According to billionaire Nick Hanauer, jobs are created to meet consumer demand; workers are hired to make goods and provide services to paying customers. No customers, no jobs.

“If a worker earns $7.25 an hour, which is now the national minimum wage, what proportion of that person’s income do you think ends up in the cash registers of local small businesses? Hardly any. That person is paying rent, ideally going out to get subsistence groceries at Safeway, and, if really lucky, has a bus pass. But she’s not going out to eat at restaurants. Not browsing for new clothes. Not buying flowers on Mother’s Day.”

One of the reasons our welfare state is failing at the moment is that the tax take has been reduced by the Government in the hope that taxes from workers via jobs created via tax cuts for the rich would make up the shortfall (it didn't), so the Government has taken to selling our data to marketing companies and cutting services in an effort to balance the books. At a time when the working poor require supplementary benefits to make ends meet, this is unsustainable in the long run. This is not to say that small businesses are the only employers but even the biggest companies require customers and even the government requires revenues. So what can we do?

In practice

 

  • Raise taxes on those earning over £500k PA to £65%
  • Cap CEO/Senior officer pay at x15 times that of the lowest-paid member of staff. When they get a pay rise, so do the staff
  • Encourage the proliferation of profit-sharing schemes to give employees more of a stake in the company
  • Increase the minimum wage to £7.50 PH
  • Cap prescription charges at £10 for multiple items
  • Subsidize public transport for those earning less than £14k PA as part of a co-payment scheme with employers
  • Create a co-payment scheme for childcare where the Government pays for half and the employer pays the rest
  • Build more social housing
  • Tax second homes and empty properties at an incremental rate to force them onto the market
  • Invest in education, healthcare, and infrastructure to support workers and encourage people into work
  • Get rid of mass surveillance. Targeted surveillance is more effective for catching criminals
  • Use Open Source software
  • Eliminate waste
  • Reform IPR (intellectual property rights) legislation, reduce copyright terms to 10-15 years, and promote alternative business models for artists, inventors and creators
  • Break up the big corporations using anti-trust laws to encourage competition and free up the market where competition is being stifled
  • End the war on drugs and treat them as a health issue

If people earn more, they'll spend more. When my wages went up from £15k PA to £17.5k PA the first thing I did was splash out on carpets for the spare room, bedroom, and hall, and curtains for the living room.

Now that I can afford to treat myself more often, they'll be seeing more of me at the local restaurants and cinemas. If other companies raise their workers' wages, service and retail-based businesses will be serving more customers, which will almost certainly mean more staff being hired. Those companies that don't find themselves suddenly more prosperous have a demand-side problem; not enough customers. If they address that they'll be back in profit.

These proposals address the truth that there is such a thing as market forces and that we need to work with them, not against them. Sixteen simple steps would take us to a better tomorrow where peoples' needs would be met, the individual would be free to act and the will of the people would be respected. Best of all, it actually works in practice — and without raising prices overmuch as robust competition keeps prices down. Profits may dip a little but businesses will definitley boom.

Author - Wendy Cockcroft

Wendy Cockcroft's picture

I'm an administrator for a facilities management company, I still write and do the odd bit of internet and eco activism. - Manchester, UK