Nathan Gardels at Noema:
The most salient issue of American politics revealed in the recent elections is “affordability” for all those earners not in the top 10%. It is an especially acute concern among young adults facing economic precarity and the lost expectation of upward mobility as technological innovation disrupts labor markets.
Ready to jump on this turn of events as a path forward for a moribund party, progressive Democrats are reverting to the standard reflex in their policy toolbox: Tax the rich and redistribute income to the less well-off through government programs. As appealing, or even compelling, as that may be as an interim fix, it does not address the long-term structural dynamic that’s behind the accelerating economic disparity heading into the AI era.
In the end, the affordability challenge can’t be remedied in any enduring way by policies that just depend on hitting up the richest. It can only be met by spreading the wealth of ownership more broadly in the first place in an economy where the top 10% own 93% of all equities in financial markets.
That means, instead of relying solely on redistributing other people’s income, forward-looking policies should foster the “pre-distribution” of wealth through forms of “universal basic capital” (UBC) wherein everyone gets richer by owning a slice of an ever-enlarging pie driven by AI-generated productivity growth.
More here.
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