I'd like to write about the policies and changes that we could make now and in the next couple of years that would shift our society onto more stable ground with better prospects. But all of those ideas and proposals rest on a more fundamental argument about what is wrong in the first place. So I've decided that I have to tackle the most basic problematic assumptions before it would make any sense to talk about the reforms that would constitute Proper Change.
The risk I run here is that what I describe below is so jarring or foreign to you that you are forced to look away. But I don't think there's any way around it, so here we go.
Status
Observation one: we're going into debt and wilfully ignoring real costs (environmental and others) to try and support ourselves, but failing to do so.
Observation two: that is causing instability and intra-society tensions.
Observation three: those weaknesses are being exploited by others who would like to reach the same level of unsustainable consumption that we have.
Truth
The truth is that our idea of society, and the whole system we have built to try and create a reality out of that idea, is wrong, unbalanced, and unachievable. The fact that other people are chasing the same goal does not support the idea, it simply reveals their ignorance.
No society ever has succeeded in attributing an economic value to all of the activity and effort that its population performs. And nor could any society ever achieve that. That should be easily obvious, but in case it's not, let's just review just a couple of examples.
No one is ever going to pay parents for all of the work and effort they put into raising children. No one is going to pay you to cook a meal for your friend. No one gets paid to help an old person cross a river or off a bus. Unless you're a recalcitrant teenager, no one is going pay you to clean up your bedroom, hoover the house, or do the dishes. You do not get paid to get to work, you do not get paid to eat your lunch, and you do not get paid to get home. I really could go on and on here, but I'm going assume that you've picked up the thread and can come up with your own examples.
All of those activities are useful, even essential. But that does not mean you get paid to do them. And there's a simple reason for that: economic activity is a subset of the total activity in a society. Therefore, there is never enough money to pay everybody to do everything that they do. Pretending otherwise is a highway to where we are now.
Money
If you have assumed that all valuable activity is compensated with money, then it may appear to you that it makes sense that everything anyone needs should be available to purchase with money. And once you have done that, then it makes perfect sense that anyone who does not have money has to be given money in order to access the basic essentials that they need to live.
And so we end up with the current "welfare" systems that masquerade as “social security” in the advanced countries today. People need money to live, so if they haven't got any money, we have to give them money. The entire premise was false to begin with and so we created a system that can never work. We cannot use money as a displacement for our responsibility to deliver on the social contract. Handing out money distorts incentives, will always be conditional (because that’s the nature of money!), and is, therefore, incomplete, ineffective, and actively discourages contribution, crushes ambition, and debilitates agency. We have managed to create a “social security” system that actively destroys our social contract, and pollutes our politics to boot!
Money is not essential to live, it is the compensation that is provided to those who create additional value recognised by someone else. Very few people create enough additional value to be compensated for everything they do. So pretty much all of us are spending some of our time putting in free effort to do the things we need to do and getting compensated for some of the other time we spend creating additional value.
Together
The reality of a human society is that we are interdependent, and we sink or swim together. The essential ingredient is that we create is a system of social support that enables as many people as possible to make as much contribution as possible. Anything that gets in the way of letting people make their contribution diminishes the effectiveness of the system, and, ultimately, that society's competitive stance with other societies.
Our problem is not that we have completely failed to recognise this essential structure, it is that we have created a confused, hybrid version and that is creating enormous tensions inside our societies. The reason we've got this mixed-up version is that we have not properly ingested the truth that not all activity has economic value. All activity has value of some kind, but that does not mean that it is entitled to monetary compensation. Just being alive does not entitle anyone to the receipt of rewards. Rewards are for added value contributions. And the core problem here is that if you have got yourself into a state where the only way you can understand "value" is by recognising it in the form of money, then you have created a trap for yourself in which you can never realise a society that fits your world view. Value exists in all sorts of forms that are not represented by money, and when we fully ingest that truth then we can build something that is balanced, productive, and sustainable.
If we had a system that recognised money solely as the contribution received for creating additional value, then we wouldn't be in the problem state we are in. We could do that, if it cost nothing to be alive. Creating that system, with less than we spend today on our benefits systems and with lower taxes, could be achieved in just a few years. It would cause very little disruption, and it would usher in a period of productivity growth that would be eye-watering by today’s standards.
Weak
We are weak. Because we cannot bring ourselves to face what is an obvious truth from the outside, we are just waiting to fail. Trying to run a society based on an unachievable level of financial redistribution, and an unsustainable exploitation of resources, is a foolish mistake. To carry on doing so is a fatal error. Only the rate of decline and the date of realisation are in question. And those who see advantage from our failure are encouraged to speed up the rate and bring forward the date.
If you value what we have built over the last few hundred years in free and democratic societies, then you need to take this seriously, now! Of course authoritarian competitor countries want the same levels of material wealth that the West has achieved. Along with that material wealth comes political power and military might. They could care less about the freedoms of individuals, but that is neither here nor there. This is a systemic competition and whole societies will win or lose. (A more glaring lesson in the vital intra-dependence of a society is hard to conjure.)
Stop digging!
So what's to be done? Well first, we could stop making the situation worse. Stop trying to make an unachievable system achievable! We are wasting time and advantage. If we don’t correct course in the next decade (possibly two) we will come apart at the seams and disintegrate. Personally, I have found the pace of populist progression surprising in both directions. It lurches forward shockingly at times, and then seems to linger like a bad smell outside a toilet before it actually comes into play. In any case, across the line from Germany, through France and the UK, to the USA, we can see very clearly the emergence of internally destructive political forces at various stages of advancement. These forces offer nothing positive because they are only the expression of failure. It is our collective failure to come to grips with the reality of our situation and rebuild our social structures to maximise the skills, ingenuity, and productivity of our populations.
Okay, so now you should have a better context for the changes we need to make. When I say we need tax and welfare reform, I'm not talking about tweaking the existing system because I think it's a little bit wrong here or there. I'm talking about a fundamental restructuring of our social conventions so that we maximise the efforts, output, and joy of our societies and all the people in them.
Next edition: three easy Proper Change policies that we could start doing now.