Quote:
Originally Posted by Tyrone Slothrop
GGG said the budgetary process has been broken for a while. Adder said everything has been broken. I think he was talking about how things get done on the Hill, hence my response. You are, as is often your wont, off on a rant about how the wealthy are busy heightening the contradictions for the great unwashed. It may or may not have been over when the Germans bombed Pearl Harbor, but there is no stopping you when you're on a roll.
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You ignore the point. This isn't a budget issue. It isn't a Beltway dysfunction issue.
It's a general societal refusal to address a malfunctioning market.
Why? Because the malfunctioning market delivers for some of us, so we don't want to see it realigned.
Examples:
1. Inefficient valuations of work.
Your broker, lawyer, CPA, professor, CEO, marketing manager, etc. are grossly overpaid relative to their value. If we didn't command the pay we do, that money would be available to be paid to other workers. But we do command that pay. Only it's not because we're worth it (I'm using a bit of Marxist "intrinsic valuation," which is a valid concept which needs to be introduced into policy discussions). It's because we've: (1) taken on fixed costs; and, (2) acquired licenses. This leads to #2.
2. Unjustifiable fixed costs to reach high paying positions.
To get a top job, one needs a degree, preferably a top degree. This costs money. Lots of money. Because of this, compensation must be greater and greater for people who are in the top 20% (at a minimum, it has to keep up with inflation in higher education costs). If you've run a business, you know that the price of a solid VP is probably about 30% higher than it ought to be, but, well, ya gotta pay it. So you find that 30% by not paying someone else - someone lower. You eliminate a customer service or assistant position and spread that labor among other assistants and customer service personnel.
In this regard, within companies, you've a zero sum competition for compensation, won in almost all instance by the higher tier employees.
3. Credentialism/License leveraging schemes
"License leveraging" isn't my word, but Milton Friedman's. He's wrong about a lot, but not about this. This is a huge tax on lower skilled workers and an insidious bar to their wage enhancement.
To do almost anything of value in this country anymore outside tech, one must acquire a license of some sort. There must be degrees, certifications, and continuing education required, at enormous cost. This effectively creates guilds. It also creates commoditization of labor, as HR screening tools eliminate non-traditionally educated, but often much better skilled workers (one can't rise up from the mail room to CEO in an age where screening software never even allows one to interview to join the company).
Pilots, doctors, electricians, people who engineer bridges - these types of people need baseline credentials. But do all these people with these strange aggregations of random letters behind their names - who work in white collar professions largely pushing papers or money around in circles - need all these licenses and credentials? Of course not. It was only a century ago, before law became a guild, that lawyers did not need law degrees. They could and did simply pass a test.
If we eliminated 50% of licensing, and limited the necessity of it to professions where malpractice could actually physically harm a person, we'd open "the ladder" up to a lot of competition. We'd give a lot of little guys who can't afford the time or investment involved in joining our license-leveraging scheme to make a living for themselves.
Tech is doing some of this for us already, but the guilds are sticky, and powerful. They lobby for licensing requirements to the death. And they work hand in hand with Big Education, which uses the need to acquire credentials as a lever to force people to pay it ungodly sums of tuition. There aren't enough Uber business models out there to destroy the power of the licensing agencies and credential mills quickly enough.
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These are just a couple examples of the way artificial barriers in our society maintain a status quo that favors an undeserving top 20%. I can say this because I've been part of that top 20% through my life. Why? Because I had advantages. Daddy could pay for things. Is life fair? Of course not. But should we have a national conversation where we discuss why we need to dismantle many of the mechanisms that bar people from rising? How this is deeply un-American, anti-innovation? How it's not a fix for this to say, "I'll hand out some crumbs in the form of increased taxes on my unjustifiably increasing income to the people at the bottom." (Why that's the most cynical form of noblesse oblige.)
There are about a hundred policy fixes we could and should discuss, and they all involve redistribution of a sort. But I don't see these things being discussed very much because they all share the same feature: Devaluing the Top 20% to effect a transfer of their indefensible income to the lower classes, who are grossly underpaid. (Run the disparity between a nurse and a VP of marketing and tell me how anyone can defend that delta. Or a teacher and corporate lawyer.)
The market is not delivering. But we can fix it, and I dare say it's simple -- make it freer, so those of us who enjoy protected high wages can sink to parity with those who don't. By eliminating a lot of licensing and credentialing requirements, we could move to a fairer value - introducing a stealth form of intrinsic valuation of labor without even mentioning Marx - almost overnight.
That's the conversation we need to be having, rather than comparing the noblesse oblige bona fides of two useless political parties.
