Towards a New Left Economic Manifesto - part 2

by whataboutbob
Fri Sep 30th, 2005 at 09:39:59 AM EST

From the diaries, for a little more face time...

In July, I posted this diary: Creating a new Left economic manifesto which was an idea that was born on a comments thread, when Tgeraghty said:

The left seems so bereft of ideas now...perhaps we need to create a manifesto for them, a set of policy proposals that would seriously address the problems of slow growth and high unemployment in Europe, but in a way that preserves the traditional European commitment to social justice.

It has been few months since that diary was posted, and last month ATinNM posted   Creating A New Left Economic Manifesto - a synopsis and with this, a meta-message that it is time to move onto a next step. What I'm going to do is take the key ideas that have been identified in fore-mentioned articles, and now run them by you once again, to see if we can further refine upon these ideas.Important: Any manifesto must be something that "Joe Europe" can understand and get behind, bexcause it will improve his/her life


So here is our challenge: What are immediate approaches to boast jobs and the economy, and long term approaches? AND what are the essential social justice issues we have and want to strengthen, and how should these be paid for?

Here is where we can start:

1.    Having confidence We can give examples of where European countries are having success mixing good business strategy with a good pro-social justice strategies. Here are some identified issues:
    The US does not use unemployment numbers the same way that European countries do, nor does the US unemployment offer the kind of protective, so don't compare ourselves to them
    The US has a huge debt. Tax cuts for the rich have not "trickled down", and so have done nothing positive for that country, except weaken the economy, the government and the social safety net.
    What is "The Commons"? Let's clearly identify this.
    We believe government that holds the common good of all its citizens is good government, and the only changes should be to strengthen those policies
    We have so far identified these things as of key importance:
i.     protecting and improving infra-structure
ii.    protecting and improving the environment
iii.    developing and utilizing new energy sources that are renewable, clean and sustainable
iv.    That the government invest in and improve upon healthcare and education, for all age groups
v.    That the government be thinking progressively about ways to encourage employment for anyone who wishes to work
vi.    That government be investing (heavily) in new and clean technologies, especially energy related
vii.    That government use regulation to improve efficiency, and to eliminate waste and corruption
viii.    That government invest in business wisely, which means looking at what is coming back to the "Commons" in return for the government investment
1.    Eliminate corporate welfare for those companies that are not giving back to society
ix.    In agriculture, small and medium sized farms should benefit from the CAP, but not large industrial farms
2.    People will support increased taxes, if what they give is given equitably by al citizens, and if what they get back in return is beneficial (ex: France, Sweden, Finland).
3.    People like and deserve a good social safety net, but it is also important to provide opportunities and incentives for work and education

Below are some of the specific ideas about how to accomplish the above:

Really push on wireless technology advances, and getting all Europe wired up with underground fiber technology, so even rural areas can have new business that will create new jobs, rather than require people to move to the cities

    Rebuilding all infrastructure (improving roads and bridges, building more electric bus lines, make more bicycle paths, encouraging the use of non-polluting transportation)

    Cleaning up water and other renewable resources

    Make a sustained effort to transform the economy, which can in itself generate more jobs (and GDP growth), including a sustained effort to get a self-sustaining economy, one not living off fast depleting fossil resources.

    Focus on reducing the use of depleting resources (example: Peak oil - start pushing now to move to new energy sources)

    With peak oil (and many other problems) now being discussed, it makes complete sense to be talking about a sustainable economy.

    Focus on economic efficiency and not on total output.

    We should fight hidden or implicit subsidies. Stop corporate welfare, except those who are contributing significantly to the Common good.

    Reassessing the CAP, so it benefits small and medium farmers only, rather than large corporate  farmers

    Developing more alternative energies. (note: there are already more jobs in wind and solar in Germany than in the entire supply chain of coal and coal-fired power plants! Alternative energies like wind and solar wouldn't only replace fossil fuel wasting electricity production as we have it today: the end result would be a highly decentralised, but strongly interdependent energy system. And solar could produce a huge amount of jobs)

    energy production should be as local and decentralized as possible.  (Cut out the middlemen.)

    the rural population would regain importance, and much of the third world would gain something that benefits the domestic population and can be sold to the North without a situation of exploitation and depletion.

    Each of the 'big new technologies' listed were successful, not on their own on a free market, but benefitted from heavy pushing by the state

    Recommend the Spanish energy regulatory framework

    It is based on a twin mechanism - one for small windfarms, which get also a fixed tariff (linked to a percentage (80-90%) of the regulated retail electricity price, thus ensuring that it creates no unfair burden for power distributors), and one for larger manufacturers, which get the market price for electricity plus a green premium, which can be either (and the producers get to choose each year) a fraction of the regulated price (but adjustable every 4 years by the government) or a full market price supported by the obligation for traditional power producers to buy such green certificates pro rata to what they pollute. With a government fully committed to renewable energy, as in Spain, this means that the regulated tariff never remains too high too long, i.e. the government can set it at the level which allows for the best projects to be economic but not the borderline ones, AND it encourages polluting producers to switch to better forms of power production.  Such market-based mechanisms work and should be more palatable to the business world, and the business media, which matters

    Focus productivity towards increasing efficiency

    Maybe not focus only on increasing the productivity of labor, but rather on increasing the productivity of capital, and even more the productivity of "rent", i.e. of natural resources or other such "free" value provided by our environment

    Change the way we consider the measure of progress. In today's neoliberal consensus, it is now GDP. Some people criticise various different ways to measure GDP. What if we somehow add the change in value of life in general to GDP?

    REGULATION, i.e. enforcement by the government of rules that apply to public goods and externalities. The above accounting can only happen if it is done by a "neutral" public entity representing the collective interest.RUTHLESSLY. This means that regulatory agencies (and/or relevant government departments) must be funded well enough to do their job (defining the rules smartly and enforcing the law).

    Taxes on consumption and revenue (to include capital revenues) make a lot more sense, and the VAT, with its self-enforcement mechanism, is very easy to police and costs little (relatively speaking) to collect.

    Encouraging the expansion of  co-operatives, a system of worker-owner type investment, which appears to carry more benefits than risks; rewarded by group profit more than the average, non-co-op employee, it is in the interest of each worker-owner to labor harder.

    We might want to consider how we can improve the economies of Europe and the 3rd world at the same time, so we are not just solving our problems, but improve their situations too (as much as we have control). What incentives can we give them?

    We should look closely at what parts of each European government systems that are effective, not necessarily having to take whole political and social systems of a given country.

    A challenge of this project is that the resulting system must be able to compete with China, India, and the Americas in business

So this is where we have gotten to in our discussions. Is there anything we have left out, can refine, or better clarify? If we can develop a clear and simple manifesto of what we believe is the essential ingredients for a New Left economic manifesto, then we could do some test runs, by runnng these ideas by our local Left politicians, media and business people, to see what we might be leaving out or need to clarify.

Your thoughts?

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I am perhaps betraying my bias here, but I realized that we need to clearly identify what are the most important basic facets of a social safety net. Well...here's my list:
    I would want to know that any health care issues are completely covered, like in France. In this, I would include mental health services, like being free to have 52 counseling or psychotherapy sessions a year if desired (and this has proven by the American Psychological Association to be a HUGE benefit for people, and often keeps people more happily/healthily at work, as a consequence).
    And I would want to make sure that education is completely paid for, though perhaps there should be some grade point requirements (or something), so that there is an incentive to participate and perform.
    Also there should be paid training, for those who are more into trade type careers
    I also strongly feel that the young should have some assurance that they will have jobs when they get out of school (this is a big issue here in east Switzerland, where the unemployment in 18-24 year olders is very high...which I feel isn't right.).
    I think there should be a liveable unemployment wage, and should include opportunity for counseling and retraining.
    I also feel that there should be a decent pension plan for the elderly, so they can live decent lives, and this would include medications being paid for.
    I also lie the French and swiss policies of paying money for children, in order to support parents being home with their children (rather than both parents havng to work jobs, just to cover bills, like in the US).
    A sensible immigration policy should be in place, so that those people who come to our countries seeking a better life, shouldn't be penalized just for being outsiders. There are many, many good citizens who want to contribute to our societies, and just want the opportunity. Perhaps we could look at what "good citizenship" is and be supportive of this. We might want to encourage/require participation in courses about the new society, to truly encourage integration into the new society...but also for the new society to learn about, appreciate and utilize their strengths and qualities too. Perhaps we look at dual citizenship, to encourage new citizens investing in our society too (not just sending money home).
    Well, needless to say, I really like the European 4-6 weeks of holiday a year...keep that one!!

What am I leaving out?


"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia

by whataboutbob on Tue Sep 27th, 2005 at 03:42:41 PM EST
I've enjoyed and found valuable this piece, and the two preceeding ones that you have referenced.  It would be a great exercise for America, in reverse, to try to gain some of the high quality life issues that Europe has over America.

But a few things jump out to me in this piece.  Not addressing, comparing, and learning from the unemployment issue would seem to diminish the value of this effort, as well as open it to significant credibility issues from the right.  Specifically I'm addressing from above: "The US does not use unemployment numbers the same way that European countries do, nor does the US unemployment offer the kind of protective, so don't compare ourselves to them"

the ability to work at a job to sustain yourself and your family is critical to most people, I think everywhere.  One of the Buddha's 8 principles was "right work".  And in such a strong work ethic culture as America, it just wouldn't fly.  And isn't unemployment one of the top political issues in France today?  

Now getting apples to apples numbers, as best as that can be done, or making people more aware of the differences in the numbers--that is clearly of value.

But I don't think those people in Europe or America that want jobs and can't get them would tell you they are leading a satisfied life of high quality.

I thought one of the points in the earlier pieces was to introduce more metrics that might get at quality of life issues, rather than to reduce existing and accepted measures.  

by wchurchill on Tue Sep 27th, 2005 at 07:26:53 PM EST
Very good points. There was discussion about a "quality of life" scale of some sort, which (for reasons I can't recall at the moment) I left off this list. But the unemployment issue is VERY key, so perhaps we can talk about this in a little more depth. One thing I recall is that European countries (speaking in generalities here), have longer unemployment benefits, and count more of the peope, whereas the US has a shorter unemployment period, and once a person stops collecting unemployment, are off the list...they are still unemployed, but not counted...so the US numbers are under-counted. How do we compare these numbers with such different systems? Well anyway, the real point is creating work for anyone who wants to work...and that is a big challenge we need to address.

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Wed Sep 28th, 2005 at 02:57:28 AM EST
[ Parent ]
We can come up with fair metrics for that: the OECD figures, which I have saved somewhere, try to correct for national figures and explain where it doesn't work. I was working on a diary on this: I'll try and get it out today.
by Colman (colman at eurotrib.com) on Wed Sep 28th, 2005 at 04:43:22 AM EST
[ Parent ]
Done now. That was fun.
by Colman (colman at eurotrib.com) on Fri Sep 30th, 2005 at 10:55:17 AM EST
[ Parent ]
Good job tackling a difficult task....

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Fri Sep 30th, 2005 at 11:02:41 AM EST
[ Parent ]
you are certainly right about understanding the differences between the various methods of counting unemployment.  I've wanted to look into this issue for years, but just haven't had time--specifically the unemployment vs. household numbers in the US, and then the differences between Europe and USA.  You are right about the shorter period of unemployment benefits in the US.  But it's my understanding that that is not the source of the unemployment figures that are commonly quoted in the US.  I believe those numbers are computed from surveys that are done, and statistics drawn for those--the question being basically, "are you looking for work".  This raises the issue of people getting discouraged and stop looking, and therefore fall out of the numbers altogether.  On the other hand, there's another growing issue of people working as consultants, and somehow being missed as working in some of the other statistics--like the ones that were discussed on this website comparing working people to total population, etc.  but anyway, I don't fully understand the intracacies of this right now.

Maybe I can find some time to look into this one.

by wchurchill on Wed Sep 28th, 2005 at 12:36:51 PM EST
[ Parent ]
Sadly, the joke in SF when the dotcom bubble burst was that when you became unemployed, you instantly became a "consultant". But actually, joking aside, there are a LOT of consultants in the European job market...and I should know, I'm one of them (I'm working though).

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Wed Sep 28th, 2005 at 01:13:56 PM EST
[ Parent ]
and know exactly what you are talking about.  My wife and I are both consultants, as are many of my neighbors and friends.  But we are all working these days.  And it's a slow process to go back to full time employment, due to more freedom as a consultant, and frankly for most of us better money.
by wchurchill on Wed Sep 28th, 2005 at 01:39:37 PM EST
[ Parent ]
part 2 to your response...there are some handy tools you should check out on this site, ways to look up economic related numbers with nifty charts etc. Check it out and bring back what you find!!

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Wed Sep 28th, 2005 at 01:15:41 PM EST
[ Parent ]
hi bob, i'm afraid you may not see this, as it's an ol diary, but I couldn't find these sources on this website that you refer to.  can you  point me?  i have found as a result of these discussions other great sites.
by wchurchill on Sun Oct 2nd, 2005 at 05:01:29 PM EST
[ Parent ]
I trust my comments are coming across as constructive, they are certainly intended that way.

"--    Focus productivity towards increasing efficiency

--    Maybe not focus only on increasing the productivity of labor, but rather on increasing the productivity of capital, and even more the productivity of "rent", i.e. of natural resources or other such "free" value provided by our environment"

I believe productivity actually is a measure of effeciency.  So for example, thinking in microeconomic terms, and carrying that down to the level of business, measures for work groups or production lines in manufacturing might be good units produced per hour--ex. 800 units produced in an 8 hour shift would give the productivity, or efficiency measure, of 100 units per hour.  Similar measures exist for machines.

When you get to the level of the business enterprise, measures such as sales per employee are attempts to aggregate and measure employee productivity.  Measure such as return on assets and return on equity are attempts to measure the return on capital, and compare the effectiveness of different businesses in using money invested in the business.

When you aggregate to the business, you obviously lose a lot of meaningfulness, particularly in measures like sales per employee.  Clearly these measures obfuscate if the productivity improvement is due to increased captial investment, or improved knowledge and skill of employees.  And I haven't ever really looked at these numbers at a national level--which is of course where your comments are focused.

But I wonder if in your first point you are intending to say, focus productivity discussions around producing the same output with less resources?  I'm not sure.

The second point on the measurement of the use of natural resources is a very interesting one.  I haven't seen attempts to do this before, but they must exist.  

Productivity measures at a national level, I believe, tend to aggregate labor and capital, and just provide one productivity measure.  The improvements could be due to improvements in labor, in capital or in systematic combination of the two.  I don't know if productivity measures at a national level attempt to measure return on capital and return on labor--are you aware of literature on these points?

I think however that the national productivity numbers receive a fair amount of focus, because they are a key driver of the ability of real wages to rise over time.  If productivity rises, the returns of that efficiency improvement comes to labor, and to the owners of capital--theoretically anyway.

by wchurchill on Wed Sep 28th, 2005 at 01:35:23 PM EST
First of all, thanks again for this...and I completely take your comments as productive and well meaning.

I also must admit that I am a bit over my head when we start discussing "productiveness", from a business perspective (be that local or national) so hope some of our other community members can add to this discussion in a more expert way than I can. My intension here is to have this be an "open source" discussion, where we collectively build this model. So your input is valuable (and by the way, welcome to the communty!).

I worked for years as a manager in the US (I'm now in Europe), though it was in the social services profession, so trying to figure out how to measure productivity was a bit challenging there (though we figured out how to do it...but, for example, what kind of value do you put on a counselor who happened to work especially well with a psychotic, potentially violent client that everyone else was nervous about? Its labor intensive, but high value. But I digress...).

It can't just be about business bottom lines, in my opinion, it has to include "quality of life", in my estimation. For awhile now, I think the US model is more and more on the money bottom line, not on the quality of life. In Europe, the quality of life is quite high, and business is good too. How do we measure this between two systems that are so different?

Again, my concerns for putting this diary up, I acknowledge, are more practical in concern. How do we create productive and healthy business, for more jobs, so people have work, thus money to spend, so they can enjoy their lives...and still maintain a good safety net? It is an issue that isn't being addressed enough here in Europe (other than pressure from the "free marketers" who say we should abandon our system).

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia

by whataboutbob on Thu Sep 29th, 2005 at 05:26:09 AM EST
[ Parent ]
Thank you for your generous comments.  And I can certainly see how the counseling situation is one where it is extremely hard to measure productivity.  Medicine in general has challenges here.  For example, in measuring successful heart surgeries, some surgeries are far easier, with much better results than others.  So hospitals like Cleveland Clinic, Mayo, Methodist in Houston, etc. may draw the most difficult cases, so though their doctors and techniques are top notch, their results and productivity if looked at only superficially may look horrible, compared to "small city general hospital" that only does the "meat and potatoes" cases.  And the situation of counseling you describe is far more difficult to measure.

I totally agree with you that quality of life in general is better in Europe than the States.  I have European friends here in the States that often make the comment they would prefer to work in America, because they feel the opportunity and upward mobility economically is so much higher, but retire in Europe, where they really know how to live.  that is also my experience, having lived both places.  (though perhaps this California weather is hard to beat!)

but your point about measuring quality of life in addition to the economic measures is very important.  I imagine we could find some work that has been done on this already, and perhaps use some of that as a basis.

But of course the spiritual side tells us that we all have happiness right in front of us.  I was looking for a quote I loved from a book I'm reading by a Guru in India, who was a common man with basically no money, but I can't find the quote.  But this will suffice:

Tao Te Ching   #44
Fame or integrity: which is more important?
Money or happiness: which is more valuable?
Success or failure: which is more destructive?

If you look to others for fulfillment,
you will never truly be fulfilled.
If your happiness depends on money,
you will never be happy with yourself.

Be content with what you have;
rejoice in the way things are.
When you realize there is nothing lacking,
the whole world belolngs to you.

Translated by Stephen Mitchell

In some ways off the subject, but a reminder that we are really all in charge of our own quality of life, at the end of the day.  So deciding what to include as quality of life measures may be quite a challenge.  I'll do some searching though.

by wchurchill on Thu Sep 29th, 2005 at 08:55:22 PM EST
[ Parent ]
Scandinavia among Most Competitive Economies posted by TGeraghty is outstanding and very relevant to our discussion here.  It may give excellent guidance for the discussion on employment, in particular, but is valuable everywhere.  Thanks TG.
by wchurchill on Wed Sep 28th, 2005 at 05:53:59 PM EST
I don't really have the time nor knowledge to go deeply into such a breadth of topics, so I cherry-picked this  topic:


That government be investing (heavily) in new and clean technologies, especially energy related

Speaking from the scientific community, an irk I've been noticing is centred about innovation. Particularly, it is centred around the implementation of innovation. We won't get very far by investing alone; something of a culture change seems needed, at least here in this country (Netherlands).

The key problem: the implementation of a new idea or the execution of test-runs demands one thing: taking chances. Right now, I observe that people rather play safe than take a shot at something new. Far too often an innovative and potential successful idea gets struck down by political bean-counters by saying it wouldn't work well enough or that it would be too expensive.

An anecdote to illustrate. A geochemist professor I know suggested the following idea: instead of building monstrous wind turbines in the sea with their foundation on the sea floor (as is done in Denmark), create an artificial ring dike out of the shore and build the wind turbines on top of that. Production costs are "only" 100 million euros higher, yet the risk that the turbines experience down-time by heavy winds (as happens in Denmark!) are severely reduced. When he approached a think-tank of several ministries with the idea, the answer was "they thought it would be too expensive" and was not even considered. Another one of his ideas was to transform toilets into "struvinoirs". By collecting the urine within a tank to which an all-around chemical compound was added, urine would automatically precipitate as a phosphate mineral (struvite) which can be directly used for agriculture purposes. The response to that idea was that "it didn't fit the policy."

I couldn't agree more to his response: "Sir, if it is policy, it isn't innovation." It isn't just a case of sour plums, the examples are endless.

Don't get me wrong, innovation in areas such as new energies and energy conservation isn't completely stagnant around here. A lot of is picked up by commercial companies and doing good work. I think in all modesty, though, that the pace of new innovation could pick up considerably if the government would actually step up, create a funds especially designed to take risks for innovative suggestions run by a board that includes actual experts instead of managers.

by Nomad on Thu Sep 29th, 2005 at 04:18:28 PM EST


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