Democratic Ideas to Reduce Market Income Inequality by Eric Keller
An alert reader posted, "No Ideas- No votes" which I thought was a great response to my earlier post on income inequality in Anderson County. It really does no good to always point to a problem without a proposed solution to the problem. Social science provides policy focused ideas to reduce market income inequality and Democrats tend to favor them far more than Republicans. So let's start.
1. Strengthen collective bargaining rights in all public/private industries. Sociologists, economists, and political scientists have all noted that strong unions mean less inequality. Collective bargaining works to increase wages without reducing productivity. Labor Relations Board needs to regain its former authority as envisioned by FDR. Also- corporate profits (which tends to be used to pay stockholders increased dividends and/or used as stock buy-backs to increase profits) need to go into the increased wages rather than increased prices for consumers.
2. Increased regulatory authorities for the large banks. Research clearly shows the correlation between deregulation of the Securities and Exchange Commission and Market Income Inequality. Increased enforcement of existing regulations will reduce this inequality and help ward off another financial crisis.
3. Increased government stimulus spending in the poorer districts of Anderson County. This is another game changer where every dollar spent by the government in wages is multiplied by the fact poorer folks tend to buy locally. So the grocer, gas station owner, roofer, etc. all receive dollars from the increased income of other workers. For instance- subsidizing alternate energy sources is shown by economists to be a boost to the local economy.
4. A truly progressive state tax structure. Right now, Tennessee uses sales tax to fund operations (among a very few other income sources). A sales tax is a regressive tax system since the poor will have a higher percentage of their take-home pay go into the sales tax while the wealthy have a much small percentage go there. If I make the median salary in Anderson County of $25,000 (for individual) and pay $1000/year in state sales tax, that is 4% of my income. If I make $250,000 and pay $1000/year in state sales tax, that is 0.4% of my income. Barely noticeable to the affluent while very noticeable to the median working person.
I will stop here for now due to space limitations. There are far more. Democrats- since FDR- are about helping the working poor, the middle-class, and all those who struggle, have a chance to climb the ladder. Republicans tend to take the ladder away on a belief that "I have mine- you get yours" attitude. Vote Democrat.