Oren Levin-Waldman

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  • 12 Sep 2017 10:17 AM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published online in the Yonkers Tribune.

    As troubling as the events of Charlottesville have been, there are issues that go beyond marching White Supremacists and Neo-Nazis, as repulsive as they are. In response to the first group there were counter-protests from some on the left who were also violent. There is absolutely no excuse for hate groups carrying torches reminiscent of the Klu Klux Klan in the South. But there is also no excuse for violent responses. And yet, we are likely to see more such clashes in the months and maybe years to come.

    Some will argue that two extremes on either side is a symptom of the absence of a viable political center where it is clear that there are shared core values. In the U.S. those values are liberty, freedom, democracy, free expression and assembly, rule of law, peaceful transfer of power, and equal opportunity. This last value specifically speaks to the ability to achieve upward socioeconomic mobility. Although these are indeed core American values shared across the political spectrum, there are nonetheless sharp divisions over how to bring these values to fruition.

    And yet, it isn’t so much that the political center has fallen out as it is that middle class has, and that the greatest challenge the new global economy poses is that of opportunity. If anybody wants to be reminded of history, there is no question that the roots of Anti-Semitism were deeply rooted in Weimar Germany following World War I. But the principal reason for Hitler’s rise was the runaway inflation brought about by the imposition of oppressive reparations by the victorious powers. Moreover, this coupled with the humiliation of Germany being forced to accept full blame for the war.

    Obviously the travails of the middle class in the U.S. don’t really compare to the circumstances of Germany following World War I. But most models of democracy are united in one basic theme, which is that in the absence of a middle class, in which case there are two extremes in wealth and income, the circumstances are ripe for social strife, violence, and even revolution. Moreover, we have to assume that world leaders following World War II, not wanting to repeat the mistakes of the post World War I aftermath, understood this all too well.

    The U.S. Marshall Plan to rebuild war torn Europe, including Germany and Japan, rested on an assumption that there had to be economic opportunity and prosperity if another war was to be avoided. These were understood to be essential ingredients if democracy, especially in those countries where there had been no tradition of it, was to flourish.

    A broad middle class has long been deemed essential to the maintenance of democracy. When there are extremes in wealth and income, the political process often becomes skewed to representing the interests of the more affluent and wealthy. The system becomes less responsive, and ultimately non-responsive, to those at the bottom of the income distribution. Democracy, however, requires the representation of all on an equal basis.

    Extremes in wealth and income in the U.S. have only resulted in a polarization in American politics. This polarization has enabled those at the top of the income distribution to be able to devote more time and resources to supporting political parties and/or candidates who are strongly opposed to redistribution, which includes any types of policies that might benefit the poor, the blue collar working class, and even the middle class.

    Econometric models of democracy maintain that democracy prevails when there is less inequality. Why? Because economic equality effectively reduces the pressure for redistribution, which could occur as a byproduct of mass revolution and the subsequent creation of an authoritarian regime. Authoritarianism, on the other hand, tends to be prevalent in those countries where inequality is high. The redistributive demands of the worse-off citizens on the wealthy are particularly intense in highly unequal societies.

    The assumption is that through redistribution public officials can avoid strife and head off potential violence. This is based on the further assumption that unrest is often a consequence of inequality. Arguably these models assume authoritarian regimes, which are more likely to democratize in response to great inequality. Democratization is likely to occur in order to prevent a revolution which is considered to be a credible threat when society is considered to be sufficiently unequal.

    Of course, in a democratic society, or at least a nominally democratic one, the next logical response to inequality would be redistribution. In An Economic Theory of Democracy Anthony Downs argues that public officials pursue policies that benefit themselves. They are more likely to be responsive to the wealthy because they will contribute to their campaigns. Because the poor may become restless, public officials then purchase their quiescence with programs that enhance their money utility. By purchasing the quiescence of the poor, they are free to pursue those policies of greater benefit to the wealthy.

    Downs’s logic would imply redistribution, but what happens when public officials simply respond to the wealthy and ignore those at the bottom? After all, a global economy where capital is mobile requires that business climates be favorable to investment. That means lower taxes. Redistribution, however, only fuels the perception that the business climate is unfavorable to investment.

    The reality is that there has not been greater redistribution in response to growing inequality. Rather we have seen greater polarization. It is because of the lack of response to the plight of the middle class that we have such polarization in American politics. If the models are correct, it is only a foregone conclusion that there will be more violence. The violence may not begin as a traditional revolution, but as fringe groups protesting and counter-protesting one another.

    It does not help when the concerns of the working class are dismissed or deflected by identity politics, or simply a politics of “resistance.” On the contrary, those who feel that their concerns are being ignored are more likely to join fringe groups, if for no other reason that it gives them a sense of identity. If we need any more evidence for why more needs to be done to restore the middle class, we need look no further than the events of the last few weeks.

  • 17 Aug 2017 12:30 PM | Mike Lillich (Administrator)

    By Oren M. Levin-Waldman

    First published online by the Yonkers Journal.

    In his now famous A Theory of Justice written more that forty five years ago, John Rawls asks us to imagine ourselves living under a veil of ignorance. Under this veil, we have no knowledge of our abilities, attributes and resources and similarly we have no knowledge of the abilities, attributes and resources of others. Under such a veil, just what governing arrangements would we choose?

    These governing arrangements include the economic along with the political, and the sum total is about choosing a theory of justice that will be deemed to be fair. Rawls rejects the utilitarian theory which asserts the greatest happiness for the greatest number, which also accords most closely with pure democracy. Rather he asserts the principle of the priority of the right over the good.

    This is often taken to mean what is correct over the whims of the masses. Or it means that people would choose a set of arrangements that protect their rights from those that might seek to take them away because it would suit the preferences of the many. In other words, most people, he assumed, would opt for procedural justice rather than substantive justice.

    What exactly does this mean? If the priority is of the right over the good then society does not have to be equal in terms of outcomes, but it does have to be equal in terms of standing before the law, access, and opportunity. Once the veil is removed it will become apparent that not all are equal in terms of their endowments and that those with more abilities and talent will have more.

    And yet, the very nature of the global economy seriously challenges many of the assumptions behind the veil of ignorance. If we didn’t know that the forces of globalism would drive down the wages of those without any special skills, then it makes sense to choose arrangements that still speak to equality of opportunity.

    If, however, we knew what the outcome of a global economy would have been, we might have chosen a set of arrangements that not only would ensure that each has the same thing, but would fully redistribute wealth and income from the wealthy to the poor. In other words, it is possible that even under a veil of ignorance in a global economy that if presented with a scenario of rising inequality we would opt for a simple formula of over taxation of the wealthy and redistribution.

    Still, it doesn’t follow that redistribution needs to be the response to rising inequality. Perhaps under the veil of ignorance we could be told that there is rising inequality and one set of arrangements that could be chosen are institutions that would guarantee liveable wages and would ensure that wages would continue to rise? Might this not be another version of the priority of the right over the good?

    Amidst all the debates over what types of economic policies ought to be pursued is the question of which are most likely to increase people’s dependence on the state and which are more likely to ensure greater personal autonomy. For some reason, policies like the minimum wage are often presented as state interventions that infringe the freedom of workers to work for wages below the established floor.

    And yet, if we are all paid poverty wages, we cannot be autonomous, especially if we have to rely on social supports from the state to make up the difference. Nobel laureate and philosopher Amartya Sen has defined poverty not only as having little money, but of being deprived of one’s capabilities.

    It is hard to know what this means exactly. Are we deprived of our capabilities because our poverty rendered us unable to develop the skills necessary to command higher wages? Or are we deprived of our capabilities because poverty leaves us unable to function as truly independent and autonomous individuals? We do know that those with more resources — higher income — are more likely to participate in the civic affairs of their communities.

    Data from the Current Population Survey (CPS) shows that as family income increases from below $30,000 a year to just between $30,000 and $60,000 a year, civic participation increases exponentially. Already there would appear to be an argument for a $15 an hour minimum wage. We also know from some studies that it is at $15 an hour that individual reliance on social supports from the state would begin to decrease.

    If we assume that the development of capabilities entails individuals being able to develop themselves because they now have greater autonomy to do so, then the priority of the right over the good has to consist of choosing institutions that will prop up wages, especially in the greater global economy.

    After all, we do have to assume that people still want to be free and not have their rights trampled upon on the whim of the many. A set of arrangements that simply redistributes on the grounds that one who has been successful owes it to others to surrender one’s wealth is not a system that is protecting one’s rights.

    Of course, the retort might well be what about the rights of the masses not to be in poverty? Fair enough. But that obligation is not on those with wealth, but on society as a whole. Society can fulfill its obligation to protect the rights of all to live autonomous lives by simply establishing and maintaining labor market institutions that will ensure that everybody can earn a liveable wage.

    The median voter theorem holds that the more inequality there is, the greater will be the distance between the median wage and society’s average income. What the median voter theorem does is determine the tax rate for the purposes of redistribution. But the same objectives could just as easily be accomplished with higher minimum wages and strengthening collective bargaining.

    In other words, the median voter theorem follows the logic of utilitarianism whereas support of labor market institutions follows the logic of priority of the right over the good. Were we to apply Rawls’s theory of justice to addressing growing income inequality, it stands to reason that under the veil of ignorance that most might opt for strengthening institutions, because it would also accord with our well established tradition of procedural justice.

  • 08 Aug 2017 12:27 PM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published in the Yonkers Tribune.

    Among the discussions that were held when policymakers first legislated a minimum wage was what constitutes a liveable wage. Should a minimum wage be a living wage, i.e. enough to support a worker and her family? Some early reformers contended that it should be a “family” wage. What we achieved through our incremental policymaking process was a wage to provide no more than minimal sustenance. And yet, the question remains: could the minimum wage be viewed as a first step on the way to a Universal Basic Income (UBI)?

    he idea of a UBI is not new, but has captured the imagination of some, particularly in the Silicon Valley, who have perhaps raised a question that nobody really wants to address: does technology render work, especially low-skilled work, obsolete that all citizens will need to have a minimum basic income as a matter of right? In other words, does the process of creative destruction that Joseph Schumpeter identified make a UBI inevitable?

    Schumpeter’s theory of creative destruction holds that the old and obsolete are replaced by the new and technologically more advanced. Just as auto manufacturing replaced buggy whip manufacturing and this was a measure of progress, high technology companies requiring highly skilled workers replacing low-skilled manufacturing is also considered to be progress. It is commonly assumed that everybody will be reabsorbed into the economy. But those who unable to acquire the skills needed for the new economy have been reabsorbed into the low-skilled service economy.

    Let’s consider for a moment just what is going on. By many measures the Industrial Revolution that resulted in manufacturing replacing the old commercial craft economy was considered progress. And yet, highly paid craftsmen who were independent were now forced to accept barely subsistence wages as low-skilled assembly line workers in the factories.

    It was through labor market institutions like unions that these low-skilled jobs were transformed into middle class jobs. In other words, the economic transformations that were occurring in Nineteenth Century America made labor market institutions that would bolster wages inevitable.

    Now that we are in a more global economy where the effect has been to exert even more downward pressure on wages, especially at the low end, labor market institutions are more critical. A higher minimum wage could no doubt have the same effect of transforming low-skilled service jobs into middle class jobs.

    The critic, however, will respond that mandating a higher minimum wage, especially a $15.00 an hour minimum will only be counterproductive as employers will find it more cost-effective to substitute technology for workers. Therefore, wages should remain low, and if necessary these workers can receive subsidies.

    Subsidies? If we are going to have to subsidize their low pay, then why not simply provide workers with a universal basic income which allows them to live in dignity? Of course, if people then want to supplement their UBI with even low-wage work, they can do so. In other words, isn’t technology that resulted in our well integrated global economy only making it a foregone conclusion that everybody will need to receive a UBI?

    Of course, the concept raises some serious questions. The first and obvious one is just how much would this cost and who would pay for it? If people receive a UBI would they not have less incentive to work? If as a result of fewer people working, we have fewer tax payers, then the first question of how we pay for it is even more important? If more people receive a UBI and opt not to work, does that not make us more dependent on the state, thereby eroding personal autonomy even further?

    It is possible that there could be hidden benefits to the economy. The concept would transform the nature of work as we have understood it. Until now, work has been understood as that which is necessary because workers are needs traders who have to work in order to make a living. But if everybody were to receive a UBI, workers would be working because they want to.

    Workers, just like their employers, would become wants traders and could use their desire to work as a new protection against exploitation. The employer, after all, can exploit because he has the power to do so and the worker needing wages is at his mercy. With a UBI, workers who are exploited simply walk away. It is now conceivable that employers who still need actual workers will be forced to pay higher wages in order to attract workers who otherwise don’t really need to work.

    Therefore, it is possible that a UBI could result in supply-side effects in that more workers will be attracted into the labor market as employers are offering higher wages. We could also see more flexible scheduling, more family friendly workplaces as employers seek to make work more attractive. Workers working because they want to could be beneficial to society as a whole.

    Of course, high paying employers have already been doing this, but now low-paying employers would be forced to offer similar inducements. There are those who will argue that a UBI is exactly what is needed in the face of rising inequality, but those with skills who continue to work for high technology companies will continue to receive higher wages on top of their UBIs. There will always be income inequality.

    On one level, a higher minimum wage could be viewed as a first step on the way to a UBI. It helps us figure out the level for this UBI. On another level, the UBI renders the minimum wage obsolete. Workers will get their UBIs from the state and their employers will be forced to pay them wages that make them want to work. Because they want to work, they will be more efficient, in which case the wages they are paid are efficiency wages.

    Will the labor force be smaller? It is possible that fewer people will want to work. But it is also possible that more people will be working, except that they will be working part-time because they want a better balance between work and family. Still, we are left with the question of cost.

    And yet, when we consider the costs of the current welfare state, it may be that a UBI, which would replace all social programs might not cost that much more. The real challenge is that by creating a greater role for government it challenges American conceptions of independence. But then again, those conceptions have been under assault from the march of technology which may be making the UBI inevitable.

  • 11 Jun 2017 12:01 PM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published online by the Yonkers Tribune

    As Congress takes up the GOP proposal for tax reform, some fundamental differences between red states and blue states will be put front and center. A huge difference between them is that blue states have higher tax burdens than do red states, and the cost of living in blue states tends to be higher, too. The blue state/red state divide is usually visible during presidential elections, but the GOP proposal to eliminate state and local tax deductions does again highlight that divide.

    Eliminating the state and local tax deduction would result in blue state residents paying more taxes than red state residents. With the deduction, higher state and local taxes can be offset by a deduction that effectively reduces the federal liability. One way to look at the elimination of this deduction is that all taxpayers would be treated equally. Instead of blue state residents effectively paying lower federal taxes, they would now all be paying at the same rate.

    Another way to look at it is that the elimination of the deduction does not treat people equally because states can still tax more than others. The deduction was but one way to equalize the differences. And yet, the differences raise some interesting constitutional issues. Under the American system of federalism, states are sovereign and can according to their respective laws, whether by statute or state constitution, impose taxes. The taxes they impose cannot be limited by the federal government.

    The Equal Protection Clause of the Fourteenth Amendment, however, says that states cannot treat individuals differently. This is usually thought to mean that states cannot create invidious classifications between people. It has not meant that states are all required to have the same tax rate because not having the same rate would effectively be treating blue state residents differently from red state residents. That would involve a broader conception of the Equal Protection Clause, and one which has no real basis in American constitutional jurisprudence.

    But that does not mean that politically speaking blue state residents are not being treated differently from red state residents. They are subject to higher taxes under the current system. If reform is passed, they will no longer have the federal deduction to mitigate those differences.

    Perhaps the question we ought to ask is just what are the likely consequences of eliminating deductions? One possible consequence is more migration of both people and capital from blue states to red states because the taxes will indeed be lower. Of course this begs the question: have taxes in blue states been higher because of larger populations in need of services, or have they been higher because the deduction only encouraged blue state politicians to impose higher taxes?

    In other words, might they have had higher taxes because they figured that with the deduction they would be little noticed by their residents? In other words, the deduction has meant that residents in red states have effectively been subsidizing blue states. To the extent that is true, the deduction may have also been distorting state spending priorities because politicians simply assumed that they could raise their taxes and the deduction would simply mitigate the additional pain they may have experienced.

    Still, one wonders why blue state residents may have been content to pay higher taxes when they simply could have left to go to red states. After all, red states, compared to blue, have lower costs of living and lower levels of income inequality.

    If we borrow from public choice theory we might gain a bit of understanding into why blue state residents have been willing to pay higher taxes. The basic premise, as put forth by Anthony Downs in An Economic Theory of Democracy sixty years ago is that each person and or group is a rational actor acting according to self interest. Individuals vote on the basis of which candidate and/or political party will best serve their interests. Public officials seeking to be elected also pursue policies that serve their’s.

    Because wealthier people are more likely to participate and contribute to political campaigns, public officials are more likely to put their interests over those of everybody else. But because poor people can band together, their interests cannot simply be ignored. Therefore, public officials will purchase the quiescence of those at the bottom with programs that might increase their money utility. This then frees public officials to pursue those policies favored by the wealthy. In essence the money utility of all is increased at a cost to all.

    This idea has become the basis of the median voter theorem put forth by Alan Meltzer and Scott Richard. According to the Meltzer-Richard construct, the greater the distance between the median voter’s income and society’s average income, the more inequality there is. In response to growing inequality, public officials will opt for redistribution in order to stave off the potential for violence. The median voter is effectively choosing the rate of taxation for the purposes of redistribution.

    States that have higher taxes may be purchasing the quiescence of low-income voters with programs, but pursuing other policies favorable to the rich. Both groups are increasing their money utility. The federal tax deduction no doubt helps public officials to do this at the state and local level. In other words, it may be that voters in these states are opting, as counter-intuitive as that may seem, for higher taxes.

    Why would the median voter opt for higher taxes? Why similarly would the blue state voter? Because the blue state voter expects to get something in exchange that boosts his money utility. So too does the median voter. If we understand what is going on, we can now understand why tax reform with a few flat tax rates and absolutely no deductions is almost an impossibility despite the fact that such an approach might be more in the public interest.

    Those on the left have been calling for more taxes on the wealthy is response to growing income inequality. This is certainly assumed by the median voter theorem. But to boost the tax rates of the wealthy does not really mean they will be paying more taxes because they have enough deductions to offset the higher marginal tax rates the left would gladly impose. Not only do they serve their money utility interests, but they have the added bonus of appearing to speak the language of the public interest: compassion for the poor.

    Simply put, tax reform is not in their interests and it certainly isn’t in their interests if they are high tax blue states. And yet, all of this rent seeking — the seeking of personal advantage — is ultimately contrary to the public interest. What is the effect of this? To distort voting generally. To distort spending priorities. To distort democracy altogether. One does not support policy because it is in the public interest, but because there is a payoff.

    The tax code in all its complexity has become a means to distribute goods to all that come along at a cost to us all. The federal tax deduction for state and local taxes is effectively a payoff to blue states who are further incentivized to spend money on programs because the deductions allow them to raise taxes. In the end, tax reform will be difficult, if not altogether impossible to achieve.

  • 11 May 2017 7:18 PM | Mike Lillich (Administrator)

    By Orin Levin-Waldman

    *First published online in the Yonkers Tribune

    As increasingly more jobs are lost to technology and wage rates fall, the answer offered by many is that government needs to offer social supports that make up the difference. This, however begs a fundamental question: in effectively redefining the nature of work, does it also render the concept of property as we have known it obsolete?

    A free market economy requires a system of private property because one cannot sell what one does not own. This would be true of one’s labor. The worker is selling what s/he has control over: his/her labor power. Property in turn is protected by a legal system revolving around contracts. The worker selling his/her labor power is said to have freedom of contract — the ability to freely negotiate the working conditions that will be worked under and wages that will be received.

    Meanwhile, the employer is said to have property rights in his/her firm and can therefore establish the working conditions as an extension of those property rights. When the state regulates a firm in any way, it is effectively interfering with the employer’s property rights because the employer can no longer freely dispose of that property as s/he sees fit.

    And yet, the nature of the modern economy is such that as there is greater interdependence and also dislocation from creative destruction, more regulation is needed. In other words, the modern capitalist economy needs to be regulated if it is to survive. The more regulation, the more infringement of property rights.

    The modern employer can no longer freely dispose of his/her property as s/he sees fit because there are too many externalities. That is, too many people can now be adversely affected by the actions one takes in disposing of one’s property. Of course, the same logic applies to employers paying their workers too little.

    Arguably a low wage employer seeking to pay his/her workers as little as possible is within his/her rights to do so because these workers are working on his/her property and s/he can dispose of that property as s/he sees fit. A mandated wage floor, i.e., minimum wage, effectively interferes with that employer’s property rights. But as technology creates an oversupply of low-skilled workers in the otherwise low-wage labor market, more government involvement is needed; not less.

    At a minimum, a higher minimum wage is needed. But even that may not be enough and these low wage workers will be in need of more subsidies from the state. In other words, the externalities arising from a low wage economy are more dependence on the state. There is no longer any room in the low wage labor market for personal independence because work for wages alone is insufficient to support one’s self.

    Even if we could define a worker’s labor in terms of a property right, that property right is being abridged through the worker’s greater dependence on the state. The worker, after all, receiving social supports is often subject to regulations attached to the receipt of those subsidies. The low-wage worker does not have a hope that s/he can be independent.

    At the same time, we are told that to raise wages too much through mandatory wage floors only risks more substitution of technology for workers. Therefore, workers should get training so they can command higher wages. But too many people going to college could create an oversupply of wages at the top thereby forcing down wages at the top. Or it could lower the bar and force more “college” educated workers into low-wage service employment, in which case low-skilled workers may permanently be frozen out of the market.

    Does this mean that low-wage/low skilled workers are doomed to be part of a permanent underclass? Or does it require that we as a society redefine the meaning of work and ultimately property rights? Could we be heading towards an era of post-employment? If so, wouldn’t that require more assistance as even fewer people would be working? Would that not require that government ensure that all have a guaranteed minimum income, or universal basic income (UBI) as it is sometimes called?

    But if all are to receive a UBI, and one sufficient to live above poverty, then greater redistribution will be needed to pay for it. That will only entail abridging the property rights of owners some more. To the extent that technology may be leading us in this direction, it then has to follow that it is leading to the obsolescence of property as we have known it.

    Of course, this tale might not be that different from the one that Marx told when he said that capitalists’ have systems were doomed to implode on their own. After all, technology created the mass production factory system which drove down wages — the low wages that low-skilled workers were now getting because their jobs as skilled artisans that paid more were gone. To compete, employers would seek to lower wages even more. They would in fact engage in a race to the bottom. And yet, as they would do this, nobody would have the wherewithal to demand goods and services in the aggregate. The system would ultimately implode.

    Private property would give way to collective property ownership whereby the workers would own the means of production. Of course, until the revolution was complete, a strong state would be needed. Once completed the state apparatus would wither away and everybody would be completely free. We all know that never happened.

    Still, there are eerie parallels between Marx’s diagnosis and the global economy we are living in whereby more technology will ultimately result in the end of employment, greater dependence on the state and the obsolescence of private property. Though we aren’t experiencing a 1917 style communist revolution, we are seeing revolutions of sorts with more right-wing nationalist parties around the world campaigning on platforms of protectionism in the name of forgotten workers.

    It may well be that we cannot ever avoid redefining the meaning of property. And we may not be able to avoid state involvement, in which case we will need to rethink what it means to live an autonomous life. Even strengthening labor market institutions assumes a positive role for government. But in a democratic society it does mean that we will need to have a public discussion of what type of society we want to live in. The free marketplace can no longer be assumed to be the solution. To the extent this is true, earlier conceptions of property rights are rendered meaningless.

    Read the review of the just published “Wage Policy, Income Distribution, and Democratic Policy” By Oren M. Levin-Waldman.

    # # #

    Oren M. Levin-Waldman, Ph.D., Professor at the Graduate School for Public Affairs and Administration at Metropolitan College of New York, Research Scholar at the Binzagr Institute for Sustainable Prosperity, as well as faculty member in the Milano School for International Affairs, Management, and Urban Policy at the New School. Direct email to: olevin-waldman@mcny.edu

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    Hezi ArisDoes Technology Render the Traditional Concept of Property Obsolete?
  • 03 Apr 2017 3:21 PM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published online in the Yonkers Tribune

    The collapse of the Republican Healthcare reform bill illustrates a fundamental point that has been lost on many, which is that moral obligations cannot be met through competitive markets

    In my last column, “The Only Viable Health Insurance Reform is a Single Payer SystemI noted that healthcare really is not a normal market. On the contrary, to ensure that all are covered requires the type of moral commitment that can only be met through non-market intervention.

    In a traditional competitive market, individuals satisfy their preferences and healthcare, like all other markets, obtaining it would be like any other preference. Those who can afford it will get it and those who cannot will not. When politicians talk about free markets, they aren’t telling you that the market is really about preferences and wants, and that those preferences are allocated through a price system.

    Healthcare is not a preference or a want, but a need. Preferences, after all, imply that they really aren’t needed. We all need healthcare at some point in our lives and at some point that care will be extremely costly. From a moral standpoint, a society that prizes life cannot allow people to get sick, suffer and ultimately die because they could not obtain healthcare by the rules of the traditional marketplace.

    The language of markets also allows for the fiction that we have choices. If simply a preference, we would purchase health insurance as a matter of choice, and if enough individuals opted not to because the price was too high, then insurance companies would be required to reduce their prices in efforts to get more individuals to buy. Of course, if a need, and we all need it, then insurance companies don’t have to compete for customers and can raise their prices.

    On one level there were those who voted against the bill because it was not pure market enough. Too many subsidies were still available. On another level, there were those who voted against it because too many people would be left without insurance because it would simply be unaffordable and subsidies through tax credits were going to be available to people based on their age rather than their income.

    From an insurance standpoint this makes perfect sense. If the goal is to increase the insurance pool with young healthy individuals who otherwise might opt not to purchase, offering them subsidies might entice them to do so. But older people, who because they are most likely to have health problems, would not have received much and would see their costs rise. Again from an insurance perspective, it does not make sense to insure them at all. After all, the goal of insurance companies is to make money.

    One way to look at the problem is that free markets are a convenient argument for maintaining a particular status quo. Moreover, it allows those with wealth and power to mask their selfish intentions, which is not to have to pay for others. Because we subscribe to a free marketplace, any policy that interferes with that marketplace is inefficient. There is no question that the Affordable Care Act is inefficient. But its replacement with the Ryan plan would not have made it any more so.

    Another way to look at the problem is to look at markets for what they truly are: amoral arenas where we can purchase goods and services, and where those goods and services will be allocated on the basis of price. To say it is amoral is to say that it is neither moral nor immoral. To then say that the provision of access to healthcare is a matter of moral obligation is to recognize that the marketplace is ill-equipped to meet moral obligations.

    The principal reason that we have public policies is because of market failure. We have unemployment insurance because the market often fails to ensure that there are enough jobs for everybody all the time. We have public assistance and other programs to help the working poor because the market fails to ensure that everybody has the opportunity to earn a living, or if people do work they earn enough to support themselves. When policy begins to cover social issues it is because market failure has become larger social failure.

    The problem is that it isn’t just a matter of market failure. Take the labor market as an example. We might say wage floors are necessary because the market place fails to pay workers enough to live on. But this overlooks the power dynamic. Employers can pay their workers less because the labor market, like the healthcare market isn’t a normal market either.

    Workers are needs traders while employers are wants traders. A worker needs to eat and therefore is forced to accept whatever job may be offered regardless of how little it pays in order to do so. The employer, however, with resources does not necessarily need to hire workers if their wage demands are too high. S/he has the luxury of holding off until workers are willing to accept less in exchange for work. The principal difference between the worker and the employer is that the latter has market power, while the former does not. Labor market institutions like unions and minimum wages give workers a degree of market power so that they can almost be on an even playing field.

    Remember that the market place is amoral and cannot see the immorality of the power imbalance. Similarly, the marketplace cannot see the immorality of a competitive market that would allow people to go bankrupt in order to get essential medical care, or worse allow people to die because they cannot.

    If anything, this past week’s debacle only demonstrates the amorality of the marketplace and why we cannot rely on it to solve problems which at root are moral obligations. Even if we acknowledge that a market approach could be found through employer vouchers going to their workers to purchase their own policies on the open market, there would still be a degree of moral hazard: people behaving in perverse ways. Even if in the short-term prices came down to attract customers, they will still rise in the long-term because more demanding insurance, especially when armed with vouchers to purchase it, will only shift the demand curve outward, thereby raising the equilibrium price.

    At the end of the day it is a question of recognizing which set of consequences are less bad than others. But if we can recognize that the marketplace is not equipped to solve all of the nation’s problems, then we can move beyond the traditional theory of competitive markets. Perhaps this failure last week should be viewed as an opportunity by President Trump to endorse the single payer system and dare Democrats to oppose him.

  • 01 Mar 2017 2:24 PM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published online by the Yonkers Tribune.

    Dr. Oren M. Levin-Waldman, Ph.D.

    Dr. Oren M. Levin-Waldman, Ph.D.


    t would be convenient to dismiss states like New YorkNew Jersey‘ and Connecticutthat have raised their own minimum wages in recent years as simply blue states. After all states with Democratic governors, except New Jersey, and Democratic legislatures are no doubt more likely to raise minimum wages than Republican controlled red states. Moreover, states in the tristate area are high cost of living states, which almost makes increases in the minimum wage an absolute necessity.

    Although living costs should be a factor, the real question is what other variables might also drive the need for a non-market intervention. In other words, to discuss wage floors as a necessity in an environment of stagnant wages is to recognize that the market place, or the changing demographics of the labor market, have forced down wages that all that is left at the moment is a legislative solution.

    Let’s consider the following: Between 2000 and 2015, according to data from the Current Population Survey (CPS) Professional and Technical occupations increased by 9.7 percent in New York and by 22.8 percent in Connecticut, but decreased by 9.8 percent in New Jersey. In all other states Professional and Technical rose by 24.2 percent. During this time the median hourly wage was approximately $26.44 in 2015 dollars in 2000 and was $26.44 in real dollars in 2015.

    Of course minimum wages, unless we are talking about wage contour effects, won’t really have much impact on those in Professional and Technical Occupations. The real changes appear to be among craftsmen, operatives, and laborers: so-called blue collar occupations. Those working as craftsmen decreased by 19.8 and 34 percent in New York and New Jersey respectively, between 2000 and 2015. In Connecticut there was a 3.5 percent increase, while there was a 16.3 percent decrease in all other states.

    Those working as operatives decreased by 28.9, 8.7, and 38.9 percent in New York, New Jersey, and Connecticut respectively. In all other states, the decrease was only 11 percent. And those working as laborers decreased by 13.9 percent and 3.4 percent in New York and Connecticut respectively. There was no decrease between 2000 and 2015 in New Jersey.

    The median wage for craftsmen in 2000 was $14.18 an hour in real terms and $19.23 an hour in 2015. When adjusted for inflation, craftsmen were earning $19.52 an hour in 2000. The median wage for operatives was $10.58 an hour in real terms in 2000 and $15.38 an hour in 2015. When adjusted for inflation, the operative was earning $14.56 an hour in 2000. So while the craftsmen’s hourly wage fell sightly, it rose a bit for the operative, but not by much. The laborer, however was earning $8.46 an hour in real terms in 2000 and $12.02 an hour in 2015. The laborer, however, was actually earning $11.64 an hour in 2015 dollars in 2000, meaning that the laborer too received a sight pay increase.

    We can already see the decline in what might be considered skilled or semi-skilled jobs, but wages have all but stagnated. It is in the services that we have seen increases. In service private household services, there was an increase of 12.5 and 71.4 percent respectively in Connecticut and New Jersey respectively, but a 9 percent decrease in New York. In all other states, there was also a 71.4 percent increase. Among service workers, non-private household, there was an increase by 10.0, 9.7, 30.4 and 6.6 percent in New York, New Jersey, Connecticut and all other states respectively.

    Service workers in private households earned $4.81 an hour in real terms in 2000 and $9.62 an hour in 2015. These workers were earning $6.62 an hour in 2015 dollars in 2000. Service workers in non-private household were earning $8.00 an hour in real terms in 2000 and $12.02 in 2015. These workers were earning $11.01 an hour in 2015 dollars in 2000. Workers who then can be said to have seen their wages rise were service workers: 45.3 percent for those in private household and 9.2 percent in non-private household.

    On the industry side, particularly in New York, there have been steep declines in manufacturing and increases in Entertainment and Recreation Services. Those working in manufacturing decreased by 58.4, 32.2, 45.7 and 30.9 percent in New York, New Jersey, and Connecticut, and all other states respectively during this period. Those working in Entertainment and Recreation Services decreased by 8.3 percent in Connecticut and by 4.5 percent in New Jersey. In New York, however, there was a 65.2 percent increase and an 18.2 percent increase in all other states among those working in this industry.

    Manufacturing workers earned $14.42 an hour nationally in real terms in 2000 and $20.68 an hour in 2015. Manufacturing workers were earning $19.85 an hour in 2015 dollars in 2000, which means their wages only rose by 4.2 percent amidst steep declines in manufacturing jobs. Those in Entertainment and Recreation Services were earning $12.12 in real terms in 2000 and $16.82 in 2015. When adjusted for inflation, these workers were earning $16.54 an hour in 2000.

    Objectively speaking, wages across the board, for the exception of certain types of service jobs, have been stagnant. But it is also clear that there has been a decrease in higher paying jobs, especially for those lacking in skills. At the same time, there has been a significant decrease in union membership. On the basis of the CPS sample from 2000-2015, union membership was only 3.2 percent in 2000 and 1.8 percent in 2015. It was 6.0 percent in New York in 2000 and 3.6 percent in 2015. In all other states union membership declined by 10.5 percent between 2000 and 2015, but by 18.2 percent in New York.

    Unionized workers are accustomed to being paid more. In New York, the median union wage was $16.45 in real terms, which was $22.64 in 2015 dollars. The median wage for non union members in New York was $14.73 in real terms, which was $19.72 in 2015 dollars, a difference of 14.8 percent. In 2015, however, the median union wage of $21.35 in New York was actually lower than the median non-union wage of $21.64. This might be because of the growth of jobs requiring more skills in sectors that were never traditionally unionized.

    Nationally, however, there was still a difference, or what we might call a union premium. The median wage in the U.S. in 2000 was $17.00 an hour, which was $23.40 in 2015 while the median non-union wage was $13.26 an hour, which was $18.25 in 2015 dollars, a difference of 37.6 percent. In 2015, the median union wage was $25.00 an hour while the median non-union wage was $19.23 an hour, a difference of 30 percent.

    Although blue states may be more likely to pass wage floors and have laws that make unionizing efforts easier, it should become clear that in the tristate area, at least, there is a need for labor market institutions like unions and minimum wages simply by the sheer force of the labor market shifts that have been occurring. Unions clearly make a difference, and where unionism is in decline, then legislated wage floors are essential to bolster the wages of workers.

  • 16 Feb 2017 2:59 PM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published online in the Yonkers Tribune

    Something strange happened on the way to the 2016 presidential election. Many states that previously voted blue — Democratic — flipped and voted red — Republican. And yet the demographics of blue states and red states are quite revealing. On the face of it, it would appear that more workers in red states tend to be less educated and/or skilled, and are in occupations and industries that have perhaps been left behind by the forces of globalism.


    t is already understood that President Trump won mostly white blue collar voters in fly-over states. Many of these states in what is often referred to as the rust-belt were once home to a thriving manufacturing base. Promises that manufacturing could be lured back certainly resonated with these voters. Though it would be convenient to suggest vast cultural differences between blue states and red states, many of the differences are demographic.

    In 2015 blue states had higher rates of income inequality than did red states. Educational attainment in blue states was also higher. Although red states had a higher percentage of workers that attained less than a 12th grade education than did blue states, they also had 5.8 percent more high school graduates and 6.0 percent more people with associates degrees than did blue states. But blue states had 5.4 percent more people with a B.A. degree than did red states and 33.5 percent more people with graduate and professional degrees.

    The greater number of people in blue states with higher education would appear to explain why there may be greater inequality in blue states. It is certainly consistent with the neoclassical argument that rising income inequality is due to technical change biased towards those possessing skills. But industrial and occupational compositions suggest that blue states would indeed require more skilled workers. And to the extent that the old manufacturing base is being replaced by industries and occupations requiring greater skills, it would certainly explain a large portion of the electorate feeling left behind in today’s global economy.

    In terms of occupations, blue states had 23.2 percent more people employed in Professional and Technical occupations and 17.2 percent employed as Managers, Officials, and Proprietors. Red states, however, had 15.4 percent more people employed as craftsmen, 15.9 percent more people employed as operatives and 15.8 percent more people employed as laborers than did red states.

    In terms of industries, red states had 30.8 percent more people in Agriculture, Forestry, Fishing and 900 percent more people in mining than did blue states. Red states also had 16.1 percent more people in construction than did blue states. Blue states, however, had 17.9 percent more people working in Finance, Insurance, Real Estate, 40 percent more in Entertainment and Recreation Services, and 12.9 percent more in Professional and Related industries than did red states.

    On one level it would appear that red states had more people employed in rural type industries and occupations, while blue states had more people employed in urban type industries and occupations. On another level, however, it is clear that blue states have more people in higher paying industries and industries perhaps requiring more skills. In other words, it might be possible to conclude that Democratic politicians arguing for open borders and more investment into training programs were merely speaking to their base whom they assume are in many respects already adjusted to the realities of a global economy.

    It is also worth noting that there is actually more poverty in red states than in blue states. Red states had 6.7 percent more people receiving food stamps than did blue states, and 17.9 percent more people living below the poverty level. On the other hand, despite low levels of union membership generally, blue states had 100 percent more union members than did red states. High unionization in blue states is certainly no surprise. Many red states, particularly in the deep South, are right-to-work states which prohibit closed shops, thereby making unionization more difficult.

    Still, these demographics reveal serious differences between blue and red states that go beyond the standard liberal-conservative divide. The economic bases are still different, and perhaps not in ways dissimilar to differences that existed between the industrial North and the agrarian South prior to the New Deal. New Deal planners in the 1930s sought to modernize the Southern economy that was seen as lagging behind the North. Workers earned less and were less educated. Then a national minimum wage was seen as a needed step in the economic development of the South. Southern states, of course, resisted, all federal policies because they were seen as interfering with their way of life.

    There is no question that globalization is destroying a familiar life style for many. To flippantly dismiss the economic hardship and dispossession of those in the red states as simply not understanding the essential ingredients for progress really isn’t helpful. There is no easy answer here. And if truth be told, candidates for national office don’t really need to hire opinion pollsters; they need to study these types of demographics to understand the mood of today’s voter. Had the Democrats done that, they probably would have won.

    Are there solutions that we can glean from any of this? Labor economists who have long argued that there is a high school premium, and that because fewer people have been graduating high school over the last few decades, will no doubt argue for more investment in education and training programs. But as I have said in this space many times before, we still need a rebuilding of our labor market institutions. To invest in education and skills training — to invest in human capital — takes time. Workers need immediate relief.

    In the meantime, the work that they are left with needs to be accorded greater dignity. This can only come about through measures to lift their wages. It was unions that gave dignity to otherwise low-skilled factory work during the late Nineteenth and early Twentieth centuries. And it is unions that can confer dignity on low-skilled service work, even if it means organizing workers on an industry-wide basis rather than a firm-wide basis. And for those not covered by unions, they need to have higher minimum wages.

    Of course, given the interdependence in the economy, the greater demand for goods and services in the economy spurred by greater purchasing power, particularly for those at the bottom, will spur growth and perhaps lead to the opening of new manufacturing enterprises here in the U.S. Granted that voters in red states may not have understood economics, but they certainly understood that nobody had been listening to them and taking their plight seriously.

  • 09 Feb 2017 8:37 AM | Mike Lillich (Administrator)

    By Oren Levin-Waldman

    First published online in The Yonkers Tribune.

    The global economy is very much a product of the neoliberal policies pursued since the end of World War II. These policies stressed free trade, open borders, less government spending, privatization, and flexible wages. If unions stood in the way of wage flexibility, capital mobility across national borders would serve to weaken them by exporting union jobs. It was assumed that these ingredients would lead to greater prosperity.

    Although there is no reason to believe that Trump’s cabinet picks signals a reversal of these policies, especially his anti-labor pick to be Secretary of Labor, the question nonetheless arises as to whether we may be seeing the birth of what could be called neo-mercantilism. The old mercantilism involved the placement of overall national economic interests above those of the summation of self-interests. This meant policies that protected industries could be pursued for the sake of the national good.

    Because protectionist policies have long been viewed as an obstacle to growth and prosperity, there has been a focus on free trade. If we can sell more American goods and services abroad the nation as a whole will be more prosperous. Free trade, however, means that cheap foreign goods enter into the American market, and while this may be good for American consumers, it may not be good for the American worker.

    The challenge that free trade agreements in a global economy pose is that in order to be competitive with other nations where wage rates are significantly lower, wage rates inevitably have to fall. The only way to counteract the impact of lower wages in another country which could significantly lower the overall price is to impose an import tariff so that the price of American produced goods and foreign produced goods are nearly equivalent.

    In recent weeks, however, we have been hearing about U.S. companies following meetings with President Trump agreeing to stay in the U.S.. This may have begun with the decision by Carrier not to move its Indiana operations out of the U.S.. Despite whatever deal may have been struck by then President-elect Trump and the company, this was viewed as a positive development. Of course the neoliberal choir decried the deal on the grounds that Carrier’s labor costs would be considerably higher and this was simply contrary to economic common sense.

    The new administration appears to telling CEOs that it will reduce regulation, but if they take jobs abroad, their imports back into the country will be hit with a high tax. The idea of putting the American economy first is not a new idea. It is very much a mercantilist concept. And after years of neoliberalism, it appears to be the foundation of what will be referred to as neo-mercantilist economic policy.

    In the past when lawmakers attempted to pass restrictive legislation on capital mobility making it more difficult for plants to close in the U.S., the argument against such attempts was that such legislation violated the spirit of free trade. Restrictions on plant closings, they said, would amount to nothing more than restrictions on plant openings. Moreover, it violated the property rights of managers in a free market economy to dispose of their property as they saw fit.

    A dynamic capitalist economy, it was argued, required “creative destruction” whereby the old and obsolete would be replaced by the new and technologically more advanced. This creative destruction, after all, was merely finding expression in plant closings and capital mobility, which were really part and parcel of neoliberalism.

    Creative destruction always assumed that those who were displaced would merely be reabsorbed back into the economy. Although many were, it was a reabsorption into a lower paying service economy. The low-skilled factory jobs were replaced by low-skilled service jobs, but low-skilled service workers did not have labor market institutions like unions to bolster their wages.

    Because many of the new jobs were also requiring greater skill, we saw a widening gap between highly educated/skilled and paid workers at the top and poorly educated/skilled and paid workers at the bottom. To a large extent the 2016 election represented a populist rejection of the neoliberal policy agenda. Policies that simply benefit financiers and don’t help Main Street cannot stand. Free trade policies that allow imports to accompany the export of American jobs are simply unacceptable. Jobs that don’t pay respectable wages are simply un-American.

    Nobody campaigned for the explicit continuation of neoliberal policy, but they did campaign for key elements of it, most notably Trans-Pacific Partnership (TPP) and open borders. The same voices are arguing against renegotiation of NAFTA. Neo-mercantilism essentially holds that after the destruction is left in the wake of neoliberalism it is time to place the national economic interest above the interests of separate corporate interests.

    There is no reason that a corporation that gets billions of dollars each year to build weapons systems for the Defense Department should not be required to keep its consumer producing operations in the U.S. as a condition of the defense contract. If firms want tax breaks, they should be conditioned on keeping jobs here in the U.S.. If Congress wants to offer a stimulus package to consumers, how about a rebate of say $3,000.00 per family on the condition it be spent on goods and services in the U.S. within 90 days? If you simply want to throw it in the bank, then you lose it.

    More needs to be done. We still need to restore labor market institutions like unions and minimum wages in order to bolster the wages of service workers. While we can certainly attempt to prevent more jobs from leaving, we still need to accept that the service sector is in the Twenty-First Century what the manufacturing sector was in the early part of the Twentieth Century. Service workers need to be organized on an industry wide basis for the same reasons that factory workers were organized during the late Nineteenth Century: to afford workers dignity in their work. This dignity would come about through the bolstering of wages.

    Neo-mercantilsm, then, can be differentiated from the old mercantilism by not only placing the national economy first, but by placing workers first. Were we to build an economy where a premium was attached to workers, we would then see a full repudiation of the neoliberal policies that not only gave us the global economy, but the rising levels of income inequality we have seen over the last several decades. Whether voters were aware of it or not, they appear to have voted for a more neo-mercanilist agenda.

  • 17 Dec 2016 8:43 AM | Mike Lillich (Administrator)

    First published online in the Yonkers Tribune.

    By Oren Levin-Waldman

    It used to be that those who worked could claim that they were truly independent. Today with wages declining and middle class job opportunities drying up, it may no longer be the case that one who works is truly independent. A low-wage worker often needs government subsidies just to make ends meet. And yet even those who earn livable wages may no longer be truly independent, as increasingly workers work at the whim and mercy of their employers.

    In today’s economy we all work in a wage-labor economy. What that means is that we work for the wages we are paid and the employer owes us little more than the actual wages paid. In the older feudalistic economies of centuries past, the lords of the manors had a moral obligation to take care of their serfs. In today’s wage-labor economy, once wages have been paid to workers for their actual labor, employers have no further obligations.

    Although many employers offer health insurance and pension contributions as part of their benefits packages, they technically are not obligated to. That they do means that these benefits are merely part of the wages they pay. Again, beyond those wages, there is no further obligation. And yet, one might think that there would be a moral obligation for transparency, especially when it comes to managerial decisions that could profoundly affect the lives of their workers.

    Let’s start with the basic assumption that the value and profitability of any firm is affected by the labor that went into it. It is a fallacy to think that a company like General Motors is profitable because of smart decisions made by managers. The decisions they make with regards to investment, strategy and marketing may contribute to the company’s profitability. But if not for the labor of those workers assembling cars in plant, there are no cars to sell, and the company has no value.

    Workers’ labor, then, should entitle them to more than their wages. Should they not be entitled to share in the profits? And yet, it is the manager and shareholder who shares the profit. And in today’s limited liability corporation, when the manager makes a reckless decision that could result in the loss of profits and mass layoffs, it is the worker who first pays the price.

    Prior to limited liability corporations a factory owner who made a bad decision stood to lose all. Because the owner assumed the risk associated with investment decisions, s/he was entitled to reap to profits when those decisions turned out to be good ones. Now the manager, who really doesn’t own anything except shares, does not lose all. On the contrary, on the advice of investment banks, the manager following a reckless decision merely cuts through retrenchment. Of course retrenchment is a nice euphemism for laying workers off.

    When a manager really makes reckless decisions and is even fired by the board for losing money, that manager all too often gets a nice golden parachute. Not the worker who is paying the price for decisions made by others. One might think that by virtue of the time and effort that workers invest into their labor to collectively make the company profitable, they would be entitled to some voice in those decisions that profoundly affect them. Of course, that would be the essence of economic democracy.

    Arguably true democracy would require that individuals have a voice in all decisions that profoundly affect their lives; not just the political ones. But to give workers a voice in the decisions of their companies is contrary to the essence of the capitalist market place. After all, managerial decisions are guided by the twin axioms of maximizing profits and minimizing costs. This is, after all, the very meaning of efficiency.

    A company that opts to disinvest in the U.S. and set up operations where labor costs are a fraction of what they are in the U.S. is said to be making a sound and efficient economic decision. Carrier’s decision to keep its plant open in Indiana and maintain over a thousand jobs in the U.S. has been criticized for being economically inefficient. In a global economy capital moves to where it can get the best return on investment. And to allow workers a voice in those decisions would simply be inefficient. After all, if workers could vote on matters of capital mobility, how many would vote to effectively lay themselves off?

    Still, what is good for an individual company is not necessarily good for a national economy. What is good for the financial managers who move money around in search of growth, even if that entails massive layoffs, is not good for those working on Main Street dependent on economic development. Lest we forget, that is in part what the 2016 election was about.

    It may be impossible to “restore” the economy to its greatness, whatever that means. But what is clear is that the nature of the typical labor contract needs to be redefined. The wage labor economy that has characterized most of the world’s economies since the Industrial Revolution may now be obsolete.

    We no longer live in a world where one farming one’s plot of land has no impact on others. Everything is interdependent. Investment decisions and other managerial decisions have profound impacts on the lives of many, including workers and the communities they live in. To live in a democratic society but claim that those rules don’t apply to the private marketplace is unconscionable. When management makes decisions that affect others, then there needs to be some type of accountability. Why? Because the independence and autonomy of others is at stake.

    Ideally, we would attach some form of property rights to workers’ labor because it is their labor that ultimately adds value to their companies. Workers should have some voice that corresponds to the time and effort they invest in their countries. Managers shouldn’t only be held accountable by their corporate boards of directors, but by their workers who are also stakeholders. We really need to get away from the shareholder economy and think more in terms of the stakeholder economy.

    Perhaps the future of unions isn’t just the back and forth over wages, benefits and work rules, but worker voice and management transparency. A stakeholder economy would also remove many of the controls that employers already have over their workers. Many pension plans are already portable through 401Ks. We also need portability in health insurance. If we are not ready for a single-payer system, then employers should provide health benefits in the form of vouchers that allow workers to purchase their own insurance on the open market. After all, movement towards a stakeholder economy would be aimed at achieving greater independence, or developing what Amartya Sen has referred to our capabilities.


    Prof. Oren M. Levin-Waldman will engage in a discussion of this very subject matter on the Wednesday, December 14, 2016th broadcast of Westchester On the Level with Narog and Aris at 10am EST by accessing the following hyperlink… http://tobtr.com/9649585… to hear the program “Live” or “On Demand”. Listeners are welcome to ask a question or share their perspective with respect to this subject.

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