Blah blah blah and other economic musings

Its been said by at least one economist/sociologist that if Americans ever grow tired of the myth of the American Dream -- the idea that everyman has a shot at overcoming the obstacles to class mobility and making it big time -- we would demand more equitable wages.

I'm not John Edward's #1 promoter, but I do think he's right to say America has a poverty crisis on its hands. It might not be as noticeable in the city, where one can easily surround himself with people of similar backgrounds and interests. But my experience even in Eau Claire has shown just how much people struggle to make a living . And I'm not talking about buying a fancy car or expensive home and struggling to make the payments.

Something like 13% (more than 1 in 10, notably) of the residents of Eau Claire live below the poverty line. Thats earnings of less than $14, 00 a year for a 2-person household.

I'm not a self-defined socialist. Generally speaking i think markets do a good job of creating efficiency. But as I see it there are two real problems with the Capitalist system that are going to need to be fixed if it is to remain a viable option. Firstly, as the world becomes smaller and smaller through globalization, workers are going to need the ability to follow jobs for which they are trained. Second, capitalists need to develop a correction for the problematic undervaluation market forces seem to consistently place on human life.

1) Allowing for the free movement of labor would restrict the income disparity in developing countries, as at least some workers from more developed parts of the world would no doubt follow jobs for which they are skilled. These workers would still be working at a bargain price relative to their jobs in a developed nation (their imported money buys a higher quality of life), but they would demand higher wages than the underdeveloped workforce -- driving up wages in developing countries. The incentive to move jobs into developing countries still exists (the labor cost is still cheaper), its just not as grossly unjust as today's model. To be sure, not all people will move to follow jobs. But some will, and I'm banking that enough would follow jobs they know in lieu of facing uncertainty in their home nation to make a significant impact on the cost model. Of course, there are tremendous political and social obstacles to allowing for a global free labor market. But we're globalizing other parts of the marketplace despite these challenges, so there's no reason that it couldn't be accomplished.

2) In nearly every case i can think of (ex. wages, health care, food supply, housing) the free market substantially undervalues the importance of human life. That is to say, the traditionally efficient market in these commodities exists in such a way that the well beings of the people the market was designed to serve are not the primary interest. And the problem here is that even the best intentioned programs (like minimum wage laws, or rent controls) tend to have the opposite effect on the situation. I don't have a magic answer here, but i believe its a fundamental question that will need to be answered in our lifetimes if capitalism is to become a completely global institution.

These are somewhat incomplete thoughts, and I'm not an economist. But I am a humanist, and these things sometimes keep me up at night.

*I'll post my usual disclaimer about not enjoying arguing on principle -- only on semantics. So if you basically agree with me but want to nitpick then comment away. If you think I'm an idiot you can go fuck yourself :)*