This is part of a series on social democracy.
The first two entries:
http://www.dailykos.com/...
http://www.dailykos.com/...
The last entry: http://www.dailykos.com/...
What would a US economy that is explicitly based on social democracy look like? I am not sure what all the answers should be, but here are some suggestions.
1. Health care would be universal and not tied directly to employment. Not an original idea, but a key idea, to provide health care to everyone. The private market has failed to control health care costs, and public health care such as Medicare has proven to be more cost effective. A true universal health care plan would even make it easier for people to become self-employed or start new businesses without having to worry about health care for themselves or their family.
2. The minimum wage should be high. The real value of the minimum wage is lower than it was in the 1960s, and that did not hurt the unemployment rate. We need to make it more worthwhile for people on the bottom to work.
3. The financial industry should become boring. The financialization of the economy promotes both inequality and instability. The purpose of the financial industry is to allocate resources for production and consumption of goods and services. It should not be an end to itself. Financial regulation starting in the New Deal resulted in financial stability, without slowing down the very high growth of the 50s and 60s. Starting in the 1980s, deregulation of the financial industry started, as did financial instability.
4. Social Security is a big success and should be strengthened, not cut.
5. Education should be a main social priority. Education, including education for the blue collar careers, should be easily available to all who can use it. At one time, the California public university had free tuition, until Ronald Reagan became governor. We need to go back down that path. Economic equality, economic productivity, and better citizenship will benefit.
6. Society should invest in basic science and technology research. In a mature economy, science and technology is needed for economic growth, as well as meeting the environmental and health needs of people. This should include some high risk, high reward possibilities such as fusion power.
7. Corporations are not people, my friends. Corporations exist because the rules make it possible for them to exist with the limited liability benefit. They should not be allowed to become above the law. By their very nature, corporations cannot be expected to act in the interests of society as a whole. Rules need to exist to change the payoffs so that negative externalities are addressed. You cannot have an economy without rules any more than you can have a baseball game without rules.
8. Tax rates should become more progressive, and resemble the rate structures of the 1960s and 1970s more than the current rates. Those years saw growth rates as high or higher than the growth we see now. Income from investment should be taxed in the same way as income from wages. The estate tax should make it harder for huge concentrations of wealth to exist.
9. Campaign finance reform is needed to reduce the concentration of political power to those with concentrated wealth. This will almost certainly need a lot of public campaign financing.
10. Infrastructure is a good investment and promotes prosperity. We can't let it deteriorate as it has been in recent years. How much less would it have cost to fix the Minneapolis I35 bridge than it cost to replace it (not to mention the danger, I would have been on that bridge 30 minutes later).
11. Unions give power to the average worker. In a democratic society, everybody has to have some power to influence society. It might be possible that the most useful goal for union negotiators would be profit sharing agreements, since that would make it easier for the average worker to benefit from productivity gains.
12. We should think about having a guaranteed annual income. This could be implemented as a tax credit. Maybe it could start small and grow as the economy grows. It certainly can be structured so that going to work will always lead people to have a much higher income, which is where a high minimum wage helps. This will be controversial, but I think it should be a goal.