If the government truly served the people, solving poverty would be one of its top goals. And poverty could be solved with a few simple policies. So simple, my 4th grader can understand them. Here they are:
Evaluate the cost of living and set a poverty line, updated annually. We already set a poverty line, but our current thresholds are absurd. They are set based on the cost of food alone! (wut...!!) Cost of living should be set, based on the sum of the following:
median rent for a 1-bedroom apartment
median cost of utilities for a 1-bedroom apartment, including internet access
median cost of transportation
cost of food
PLUS 1/3 the sum of the above, to account for other expenses required for being alive in the modern world. (Clothing, grooming, medications, furniture, communications, etc.)
The sum is the official poverty line.
Mandate that minimum wage be tied to whatever it would take for an individual to be above the poverty line if they worked 35 hours per week and took 2 weeks of vacation/sick time. Mandate that minimum wage be automatically updated annually, based on this calculation.
Set an income cap, so that nobody in a business is allowed to earn more than 50 times the lowest paid employee or independent contractor in that business.
- Subsidize childcare, so that no family falls into poverty due to having a child.
Mandate that disability payments hit at least the poverty line, updated annually, so that no family falls into poverty due to disability.
- Subsidize health care (including mental and behavioral health), so that no family falls into poverty due to health expenses.
That's it. Poverty solved in six steps.
What would this look like in 2021? I'll run some quick and dirty numbers. (I'm sure these would need finessing.)
- Median rent 1B apt: $1,124 x 12 = $13,488 / year
- Median utilities: $2,060 / year
- Median transportation per car: $4,271 / year ($9,737 per household / 2.28 cars per household)
- Food: $4,450 / year
- TOTAL $24,269
- 1/3 of above, for miscellaneous expenses: 8,090
POVERTY LINE: $32,359 (one person)
Thus, minimum wage should be set so that a person working 35 hours/week can hit the poverty line, with two weeks vacation. So 50 weeks x 35 hours = 1750 hours per year.
32,359 / 1750 = $18.49 / hour minimum wage in 2021
32,359 / 12 = $2,697 / month disability payments in 2021
If we combined these wage increases with subsidizing childcare and healthcare, nobody would live in poverty in this country. Imagine all the social ills this would cure! So many of our problems are tied to poverty.
Additionally, the income caps would solve all the problems related to income inequality. For anyone worried about this kind of thing "killing innovation and motivation to succeed," please note, there is still room to grow, because the calculation is a ratio not a fixed number. It's just simply the case that if the boss wants to give himself a raise, he has to raise everyone else as well. Everyone contributes to a company's success; everyone should benefit from its profits. There are still people who are higher earners than others; they just cannot exploit other people anymore.
I have a final, more radical, idea that would be MUCH more disruptive than the above policies, but would seriously be a much more ethical way to run a modern society. I'll share it in the next post.