The discussion below is based on The Radical Center: the Future of American Politics by Ted Halstead and Michael Lind, both fellows at the New America Foundation (www.newamerica.net), an influential non-partisan public policy institute
For the first time in American history, a majority of the eligible voting population identify as independents, aligning with neither of the two major parties or any of the other available partisan options. Even in an election that is as controversial and allegedly historically significant as this one, most voters seem disgusted with both the Democratic and Republican parties and the candidates they have nominated for our highest political office. Only around half of this population regularly turns out to vote in presidential elections. This electoral “de-alignment” shows that no political entity in our nation has had the capacity to unite a majority of citizens in a lasting coalition for quite some time now. Instead, we have a “duopoly” of two antiquated, constantly feuding, and largely un-compelling giants. These two beasts have been captured by extreme special interest groups within their party ranks and thus are unable to articulate a vision that might motivate the majority of citizens to take an active part in the political process; not just to vote for the “lesser evil”. Between infighting and constant skirmishing with the other big party, neither has the ability to carry out necessary information age reforms of our antique social contracts. In such a climate, what direction do politics in America need to move in order to address the search for new, innovative solutions to our most pressing and seemingly intractable social problems?
Domestic Problems Facing America Today : Social Security insecurity, disproportionate aging of the population, immigration-induced economic effects, health insurance, poor public education in primary and secondary schools, income inequality, two-party stagnation
Broad Ideas of the Radical Centrist Agenda :
• Information Age America is distinctly different from our last great historical era, New Deal America , though most of our social institutions remain holdovers from that period and its predecessors (like Reconstruction America)
• Our public philosophy hasn't changed much - freedom to enrich oneself through hard work, freedom from oppression and destitution, freedom of public/private association - but our material realities have, so we must change our social infrastructure
• New technologies have brought us the potential of yet greater freedoms, but we must have both expanded choice and security to fully explore them, thus we must give our citizens greater choice – in voting, education, medicine, and their careers – however, a society will resist innovation so long as it is unable to implement means to mitigate the painful transition period
Economic Innovation Demands Social Innovation :
• Creative destruction is increasing at a startling pace because our economic productivity requires constant innovation
• Workers need to be able to change jobs without devastating lapses in income or insurance; without a security net to ensure these basic needs, voters will pressure politicians to safeguard outmoded jobs and industries, thus stagnating innovation
• An Information Age social contract must link all benefits to individuals rather than to employers or intermediate institutions
• More jobs are short-term because less employers want to offer insurance benefits, which are fiscal and administrative hassles
• Less and less of the population has adequate health insurance, this is especially concentrated amongst lower income groups
• A single-payer universal health care system like all other industrialized nations use has some disadvantages as an alternative – necessary rationing, killing the private insurance industry, and the lack of a private medicine market would retard innovation
• Instead, like we do with automobiles, make a basic private insurance plan mandatory for all who can afford it and provide government subsidization for the most needy who cannot – rich citizens could still purchase private “luxury” insurance plans
Social Security Reforms:
• Demographic forces in the baby-boom generation and medical technology (contraception/longevity) threaten social security
• The existing pay-as-you-go intergenerational transfer model is unsustainable in a slowly growing population
• Why would we want to continue to risk a trade-off between fiscally burdening our working generation and endangering the health and overall well-being of our aging citizens?
• So, like the newly proposed citizen-based insurance savings model, perhaps we should make similar moves in social security
• This is also a compelling idea because for the first time since the Great Depression, we have a negative national savings rate.
• Our politicians have been encouraging consumption (through the tax code and social security) for the past 60 years to buoy our manufacturing economy and trade relationships, but this occurred in an era of increasing media encouragement as well
• Unless a cultural shift occurs in fiscal responsibility, a large number of future retirees will be dependent of the public purse
• Since it seems Americans need help to accumulate adequate retirement funds, perhaps we should institute a mandatory 5% savings rate as well… social security already takes out 6% and employers match that for 12% total… if the mandatory retirement and insurance payments were taken out of this portion, it would still leave more to subsidize low-income earners
• Furthermore, people would be able to play around with how to invest this money, so long as it isn't too risky
• Finally, it wouldn't be a bad idea to move back the retirement/payout ages to compensate for increased longevity patterns
Enfranchising All Citizens in the New Economy :
• The United States has had many historical programs to broaden capital ownership – the Homestead Act after the Civil War and the GI Bill after WWII for example – but it has been a while since the last manifestation
• People are likely to become better citizens the more they have a stake in different social institutions – economic, political, etc.
• Still, our society maintains privileged groups in both these interconnected spheres… “Capitalism isn't designed to create capitalists, but to finance capital. Absent political will, these dramatically different goals will not be reconciled.”
• Perhaps we should make a point of giving children a financial nest egg at birth to give them a chance to finance a trial of their own innovative ideas in the marketplace. Call it “universal capitalism”. $5000 at birth would yield about $20000 at maturity.
• Even if most children don't use this money to capitalize an idea, it would give children with not a whole lot else going for them a better shot of catching up with the larger trust fund babies – at only about $20 billion cost to the public
• Furthermore, the money need not go to people who are already advantaged, it would be “means-tested” to avoid such waste.
Maximizing Choice at the Ballot Box :
• Our election system limits races to two main parties by design, not by tradition or any kind of will by the people.
• Plurality voting is the main reason that Clinton won in 1992 and Bush won in 2000 - Perot in 1992 siphoned off enough third-party but otherwise conservative votes to cause Bush Sr. to lose - Nader did the same thing to Gore in 2000 with liberal votes
• This is a perversion of the public will (all half of it) in deciding elected offices, but is also a reinforcer for the two party system, because any time you vote for another party or candidate, you're more likely to be a spoiler than to effect change
• Instant runoff or rank order voting consists of listing one's preferences in order (say 1 to 5) as to which candidates you favor more than others – thus, if no candidate wins a first choice majority of the votes, the secondary votes would be counted until one candidate achieves a majority by this route. However, you can see how the electoral college interferes in the presidency.
• This would encourage the emergence of serious third parties and candidates to run and voters to take them fully into account at the ballot box, while ensuring that no fringe or extremist parties could win with only a small percentage of the vote.
• Also, it would ensure that parties are represented in the government more in proportion to their actual strength in the electorate. It wouldn't cause the instability of multiparty parliaments in other countries because our executive branch is independent of the legislature and our representatives are elected by different shapes and sizes of constituencies.
• Furthermore, like Maine and Nebraska , at least the electoral votes allotted to the state could be divided by the popular vote
The Simple Consumption Tax :
• Information age tax systems should be as simple, equitable, transparent, and efficient as possible. Our national tax code is 10,000 pages long and trained professionals have trouble fully comprehending it. State sales taxes are even more complicated and regressive, people earning $750,000 pay 1% of their income sales tax annually, people making $15,000 pay 7%.
• E-commerce is proving the state sales tax system even more arcane, as products bought in other states are often exempted, the current moratorium on Internet taxes is already hurting state incomes (much of which goes education), but will only get worse
• Instead, instituting a national consumption tax whose proceeds are rebated to the states on a per capita basis could simplify the entire process and help poorer people simply by exempting $15,000 worth of essentials - housing, food, transportation
• After income taxes, say you make $50,000 annually, if you saved $10,000 and subtracted the $15,000 basic allotment, your taxable consumption would be $25,000, at 10%, it would be $2,500 you end up paying in consumption tax
• This progressive tax system would raise the same amount of money as the current patchwork of complex state and local taxes
• The rich would pay more, and education since it is considered a public virtue in the information economy, would be exempted
• While we're at it, we might as well move the same direction with the income tax code, eliminating most of the possible deductions from the income tax code that disproportionately benefit the well-to-do and salvage just middle class necessities
• Furthermore, corporate taxes should be eliminated in order to not encourage companies to look for overseas tax-shelters to move their headquarters and to not to force states to compete amongst themselves to offer the best tax breaks. Instead of corporate taxes, the burden should be shifted to the wealthy individuals themselves and their passive, high-profit assets
Education Finance Reform :
• Schools are still financed the same way as they were in the agricultural era – through local property taxes and state sales tax. This means that schools in districts with lower valued properties overall have less money to work with – the same is true of inner city schools which additionally often have lots of government-owned tax-exempt properties in their vicinity.
• We hear a lot of debate about federal initiatives to reform our struggling K-12 schools in this countries (top notch politicians bank on this), but to a large extent this is totally disingenuous because of the tiny role the federal government actually plays in bringing about greater financial parity between vastly unequally funded schools (about 7% of school funding is federal)
• To get serious about this problem, it seems we must talk about ways to equalize per capita student funding brought about on a national basis – not at a state level – Mississippi spends $4,000 per student while New Jersey spends $10,000, even after adjusting for standard of living disparities are controlled for – not at a county level – disparities are sometimes even larger
• These differences translate into lower teacher salary (lower quality instructors), larger class sizes, and inferior facilities
• Some state supreme courts like California and Vermont have stated that this funding system violates the equal protection clause, “The distribution of a resource as precious as educational opportunity should not have as its determining force the mere fortuity of a child's residence.” Almost all states have been sued on this basis and this has led to some picking up more of the funding ticket than the local school districts themselves, but has not fully addressed the issue by any means.
• Worse still, it is often that affluent home owners or older residents without children refuse to increase property taxes
• How can we apply national standards to education or assessing all students on standardized tests with these gross disparities?
• Proceeds from a national consumption tax should be allotted to states on a per pupil basis, adjusting for different cost of living
Our Greatest National Challenges:
• Spatial and geographic divides based on race, class, and age
• We have become increasingly segregated in each of these respects
• The cultural and political difference between these groups have become wider as well
• It seems that these different groups have increasingly oppositional agendas and identities
• A successful vision for improving the nation must address how to bring these social factions together
• Finally, watch out for the capacity of expanded technological power to change our society further; namely genetics