25 October 2018

Say no more

Excerpts from two sources show just how wide the gaps between our political systems and citizens have become. First, from the UK:
I looked at the Bank of England data and it was 3.5% of business lending went to manufacturing, a century or so ago that number would have been more like 80% and that’s a trend that has been going on for a long time. And you compare this 3.5% going to manufacturing with 75% going to either finance or real estate and you can see that something’s wrong, finance has become kind of unmoored and disconnected from the real economy. How oversized finance sectors are making us poorer, Nicholas Shaxson, September
And from the US, Jane Mayer writes about the role of the Koch brothers in the presidential election of 2016:
In fact, amazingly, in 2016 the Kochs’ private network of political groups had a bigger payroll than the Republican National Committee. The Koch network had 1,600 paid staffers in thirty-five states and boasted that its operation covered 80 percent of the population. ...[T]he Koch network was sponsored by just four hundred or so of the richest people in the country. Election Night 2016, Jane Mayer, 2017
There's little more to be said, except that that within our current policymaking systems, there is no self-correcting mechanism. People become wealthy within the system, and use that wealth to manipulate the system to make themselves even more wealthy. Even if the gap between politicians and people were seen to be a problem, there's nothing within our current political systems to close it. It keeps growing wider. It's clear now that anything that, on the one side, billionaires big business and politicians can do to extract resources from ordinary people and small businesses, they will do. Our ruling caste gets away with it because policymaking, by accident and design, has become an arcane, protracted process, comprehensible only to those directly involved in it or paid to follow it.

That, and society's increasing complexity, is why I suggest politics be rejigged to focus on outcomes that are meaningful to ordinary people, and that market forces, currently subverted or gamed by the wealthy, be instead channelled into the public good. That's where Social Policy Bonds would enter the picture. It's true that, under a bond regime, many investors in the bonds would be rich and, if their bonds were redeemed early, they would become richer. But this would be a socially beneficial way of acquiring wealth. The value of their bonds would rise only if society's targeted outcome, as articulated by democratic governments, become more likely to be achieved quickly. The goals of investors in the bonds and society would be exactly congruent.

A less obvious benefit of a bond regime is that, being a socially beneficial way of acquiring wealth, it would divert human and other resources away from other less socially beneficial ways, like, for instance, much of banking or speculation in real estate.

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