Important as the Paris Agreement and the many initiatives to replace fossil fuels are, by themselves they won't be sufficient to avert much of what Wallace-Wells rather vividly described in his recent New York Magazine article. People are agreeing more and more on the idea that more far-reaching changes to the underlying economic system are needed. The idea is gaining ground that to survive as a species it will be necessary to Repeal and Replace capitalism, at least in its current Neoliberal form.
In 1977 economist Herman Daly published a book called Steady State Economics. Forty years later, amid increasingly frantic efforts to come up with a solution to the massive destruction of our biosphere—climate change is just one of the symptoms—, Daly's work remains one of the few coherent and comprehensive blueprints to move to a truly sustainable economic system. Daly diagnosed the current and present ideology of "economic growth" as a devious fraud designed to give cover to oligarchs and plutocrats to maximize their exploitive activities while piously pretending to be concerned about world poverty and lifting up the "less fortunate". Daly was not the first to see "growth" as a dangerous fantasy: his work was inspired by earlier works by Nicolas Georgescu-Roegen, and back even to John Stuart Mill. However, while many recent critiques of climate change call for a drastic modification, if not an end to capitalism (as here), I have yet to see anything as specific as Daly's prescriptions for doing this.
Daly's formula has three components: limit economic growth, population growth and resource consumption. In the last 40 years there has actually been some progress in population and resources, although of a rather diffuse and disconnected kind. In the first category (economic growth), however, the situation is getting materially worse; witness the exponential growth of the critiques of the exponential growth of inequality, along with the worsening economic prospects for everyone outside of the 1%. Although there is much that could still be done to improve the population and resource overconsumption issues, at the moment it's the growth economy that is doing the most damage to the biosphere.
Daly prescription for weaning ourselves away from a growth economy has two components: a Universal Basic Income (UBI), and a maximum income (let's call it the Excess Maximum Income, or XMI). The UBI (which we can think of as Quantitative Easing for the 99%) is getting a lot of attention now as a remedy for inequality. It has a long if low-keyed history. Both the Johnson and Nixon administrations toyed with the idea as a partial replacement of the "welfare state", but their flirting was never serious. With the Business Community now completely disinterested in the idea that their wages should at least be living wages, the UBI is gaining a certain acceptance it never had before. However, in Daly's program UBI is tied to the XMI, a tax to prevent excessive money accumulation above a fixed amount per year. Until recently I though Daly was unique in arguing for a defined XMI but recently Kate Aronoff has proposed a million dollar XMI specifically to curb billionaire jerks.
Where should that upper XMI be set? Daly wrote, and still writes, that it should be an appropriate multiple of the UBI; say, he initially suggested ten times the UBI. So, taking the popular demand of $15 per hour as a good level for an UBI and extending it over the "normal" workweek and year, the result is:
$15 X 40 X 50 = $30,000
which would allow an annual maximum income of $300,000, at which level the tax bracket would be 100%
Can't scrape by on 300 grand a year?
Sucks to be you.
Daly's original idea, that no business should have a spread between the highest and lowest paid employee greater than 10X, apparently was biblically inspired, but note also that in the 1950's the pay spread between assembly line workers and executives was actually around 20X. We might accept 20 or even 50X as reasonable levels to set a XMI. But certainly not 354X, the actual average pay spread between CEO's and their serfs entry-level workers today.
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And, if it were actually provable that a maximum income of 300G would somehow hinder the economy, the remedy is simple: raise the basic income; for every dollar the UBI is raised, the oligarchy would get an extra $10.
Daly was also ahead of his time in warning how "unproductive rent-seeking" was damaging the "real" economy. Today the rentier class has almost swallowed the productive part of the economy, as Michael Hudson details in Killing the Host and J is for Junk Economics. When accounting the Steady State Economy, all the various ways rent-seeking is favored over productive activity should be drastically curtailed or eliminated: i.e. taxing all income at the same rate. No more preferential rates for real estate, interest income, or capital gains or joke inheritance taxes. There are probably many other ways the rentier class has twisted the tax system to its own advantage and all will need to be rooted out and untwisted.
While the UBI and XMI may be attractive from a standpoint of justice (and maybe even for a bit of retribution for past thievery), Daly made them central pillars in a steady-state economy because of much more objective considerations: Growth economics kills ecosystems while failing to deliver commensurate benefits to the human social sphere, outside of the 1%. Most critiques concentrate their fire on capitalism and neoliberalism, and there is no doubt that these have and continue to supercharge planetary degradation, not to mention a host of other societal problems. But the central issue is more basic: just as any political system with no checks on accumulation of power will become a tyranny, any economic system that does not limit wealth accumulation is eventually going to become a kleptocracy. The concept that "absolute power corrupts absolutely" is widely accepted in the political sphere—even by would-be tyrants, who are careful to pretend they are but humble servants of the people— but power has always been convertible into cash, and back again, so wealth can corrupt just as absolutely as power.
I've read some recent critiques of UBI from the left, that government should not be handing out money but guaranteeing everyone a good job. But if the current crop of AI (artificial intelligence) futurists are even partly correct, this will leave the government struggling to create masses of make-work jobs that will have no value beyond the illusion of purpose. There is, of course, a lot of necessary work that's not getting done because the rentier class doesn't want to pay for it (like infrastructure repair, and many aspects of education and health care) and here government could certainly direct resources, while maintaining an overall steady state economy. On the other hand there are job types that are actively harmful (the coal industry, parasitic administrative bureaucracies, and our very predatory system of health insurance) but we hesitate to dismantle them because that would mean throwing large numbers of relatively poorly paid workers out into the street with nothing. The UBI would function as a universal safety net in place of a plethora of frenetic and dubious attempts at retraining and transitioning people.
"In all well-instituted commonwealths, care has been taken to limit men's possessions; which is done for many reasons, and, among the rest, for one which, perhaps, is not often considered; that when bounds are set to men's desires, after they have acquired as much as the laws will permit them, their private interest is at an end, and they have nothing to do but take care of the public."
Jonathan Swift (quoted in Daly Steady State Economics)
The flip side of Daly's formula, our newly minted XMI, is just as, if not more important, than a UBI. Completely aside from the personal moralities (or immoralities) of the 1%, the very existence of unrestricted masses of wealth — usually considered the grand achievement of capitalism —is now a clear and present danger to human survival. Even "altruistic" mega-projects always seem to come with mega side effects that nullify whatever positive aspects the projects were supposed to have. For example, the Paris Climate Agreement hinges in part on massive carbon sequestration. But now we read that the big money crowd is using this as cover for a massive push for plantation monocultures. On a smaller scale, we see on all sides how open-ended money grubbing ("pursuit of wealth", as mainstream economists like to call it) leads to endless scamming, corner-cutting, gouging, and poisoning people and the ecosystem. Not to mention an equally massive amount of illegal activities.
Setting a maximum income (and making it stick) will gradually draw down unhealthy wealth concentrations without violently seizing people's stuff. This may not be the quickest route to a recovering planet but it is more concrete than most of the vague "revolutionary change" memes promoted by progressive groups (as if these had any chance of actually happening anyway). The growth economy as currently practiced is a socio-economic Fukushima. Daly has written a workable cleanup manual. The rest of us need to leave the debates about the ideal system for later, put on the haz-mat suits, and start shoveling out the toxic sludge.