Socioeconomic Democracy and Sustainable Development
Terminology: SeD (Socioeconomic Democracy), UGPI (Universal Guaranteed Personal Income, abbreviated UGP), MAPW (Maximum Allowable Personal Wealth, abbreviated MAW), CSDS (Center for the Study of Democratic Societies), QOG (Quality of Growth), QOJ (Quality of Justice), QOL (Quality of Life), QOW (Quality of Wealth), WFSF (World Futures Studies Federation)
Robley E. George
Director, Center for the Study of Democratic Societies
25 October 2007
This article was first published at Development 4 All, copyright © 2007 Robley E. George. Reproduction is acceptable and encouraged, with acknowledgement of author, Robley E. George, Director, Center for the Study of Democratic Societies.
Socioeconomic Democracy provides a comprehensive, just, realizable, freedom-enhancing, environment-respecting, democratic means of accomplishing not only the modest, though presently doubtful, Millennium Development Goals, but also simultaneously resolving or reducing a large number of other very real and crucial planetary problems, any of which could easily preclude realization of all well-intentioned MDGs. Socioeconomic Democracy is a practical socioeconomic system wherein there exist both some form of Universally Guaranteed Personal Income (UGPI) and some form of Maximum Allowable Personal Wealth (MAPW) limit, with both the lower bound on personal poverty and the upper bound on personal wealth set democratically by all participants of society.
Socioeconomic Democracy provides a comprehensive, just, easily implemented, freedom-enhancing, environment-respecting, fundamentally democratic means of accomplishing not only the modest UN Millennium Development Goals, but also simultaneously resolving or reducing a large number of other very real, critical and interdependent planetary problems, almost any of which could easily preclude realization of the eight well-intentioned MDGs, and all of which are currently extremely costly, distracting and unnecessary impediments and barriers to universal Sustainable Development for All.
For example, sustainable development for all would be and definitely is undesirably and importantly impacted by that multidimensional, seemingly ubiquitous problem of war. War, globally and locally, will either be eliminated or Dr. Brundtland’s admirable insights and vision of sustainable development for all will not be achieved.
Socioeconomic Democracy can further contribute, convincingly and fundamentally, to the realization of the far more basic and original UN Universal Declaration of Human Rights.
Indeed, the incentives and ramifications of Socioeconomic Democracy can provide all humanity with the means to surviving and even thriving, and will at the same time enable and encourage humanity to address the myriad global problems that are now blocking humanity’s healthy, sustainable development.
Socioeconomic Democracy (SeD) is a theoretical model socioeconomic system wherein there exist both some form of Universally Guaranteed Personal Income (UGPI, often abbreviated as UGI) and some form of Maximum Allowable Personal Wealth limit (MAPW, often abbreviated as MAW), with both the lower bound on personal material poverty and the upper bound on personal material wealth set and adjusted democratically by all participants of society.
Here, we very briefly review the essential elements of Socioeconomic Democracy, including the societally acceptable bounds on extreme material poverty and extreme personal wealth, quantitative democracy, which is employed to set these bounds, and the economic incentive created by these bounds. Then we quickly look at just a few of the many desirable properties and implications of Socioeconomic Democracy, all leading toward Sustainable Development for All.
Brief mention will be made of some possible democratic variations, practical political approximations, justifications, implementation considerations, and many of the beneficial ramifications of Socioeconomic Democracy. Please see end of proposal for convenient references presenting extensive introductions to SeD.
UGPI (or UGI). With Socioeconomic Democracy, each participant of society would understand that some form of a democratically determined minimum amount of societally guaranteed personal income or support would always be available to her. Put another way, society would guarantee each citizen some minimum amount of purchasing power, which, in a world that is busily putting a price tag on everything, is not only desirable but also highly necessary if society wants to avoid trouble. To be sure, this basic income idea dates back at least to antiquity, and has, in recent years, been increasingly explored and richly developed by numerous individuals and organizations, including the Basic Income Earth Network (BIEN).
Depending upon available resources and the degree and direction of appropriate technological development, this democratically set, societally guaranteed minimum income for all could be sufficient to satisfy the typical individual's minimum subsistence and/or personal healthy growth needs. Alternatively, other societies might democratically decide to set the guaranteed amount at a partial subsistence level, for a variety of legitimate reasons.
There are, of course, as many different names and forms of UGI (ranging at least from Basic Income (BI) to Negative Income Tax (NIT)) as there are reasons to establish some form of UGI, or, for that matter, as there are ways proposed to fund different forms of UGI. Indeed, a democratically set UGI could quite logically be called and considered universal Guaranteed Sustainable Development for All.
MAPW (or MAW). Further, with Socioeconomic Democracy, all participants of the democratic socioeconomic system would understand that all personal material wealth above the democratically determined allowable amount would, by due process, be transferred out of their ownership and control in a manner specified by the democratically designed and implemented laws of the land, and transferred in accordance with other laws of the land to fund, say, various forms of Sustainable Development for All.
Do note that all the wealth above the democratically determined maximum allowable amount, now to be devoted (after SeD is established) to the sustainable development of all, could be either transferred, in some sense, directly to a government to be deployed as appropriate, or be dispersed as the present owners desire and think best, satisfying, of course, a few reasonable laws, rules and regulations on the matter.
This latter procedure has many merits, of which one would be that the present wealth holders would in general be expected to more appreciate their “earned” opportunity to direct their democratically determined excess wealth to focusing on specific societal problems that particularly interest and concern them.
What else might motivate the (still, extremely) wealthy members of society to actually agree with and support some form of Socioeconomic Democracy, rather that simply democratically accepting it?
We notice how large companies since the beginning of the Industrial Age have occasionally voluntarily instituted somewhat similar schemes (though not to the extent or full purpose of SeD, to be sure). For instance, the Ford Foundation, the Carnegie Foundation, donations by Ted Turner to UNICEF and now the philanthropic work of Bill Gates and Warren Buffett and a growing number of others, all testify to the increasing introspective urge. In each case, large businesses realize that they depend on global markets for their success, though this writer is quite satisfied that these people also realize many other crucial global constraints.
Starkly stated, the rich need the poor to be able to buy their products; they require a peaceful environment for trade to flourish; and they require goodwill if their products are not to be boycotted. This was the essence of Fordism, and the Model-T Maker who made the model for (some said “socialistic!” while others said “not enough!”) manufacturing.
The very wealthy also realize that they are able to donate huge sums of money or large amounts of goods without diminishing the usable amount of money at their disposal. Their gifts to the poor and ailing constitute tax deductions. Donations of goods, such as computers, extend one’s business empire. Microsoft’s Windows is now used by over 90% of computers worldwide. It is an old refrain.
Moreover, once Sustainable Development for All has been instituted, a rational, self-interested and insatiable (as the neoclassical saying goes) extremely wealthy, law-abiding participant in the democratic socioeconomic system, who is at or near the upper bound on allowable personal wealth and who further desires increased personal wealth, would be economically motivated, that is, have economic incentive, to actively and seriously work to increase the well-being of the less well-off members of society. Only in this manner can these (still-wealthiest) participants persuade a majority of the participants of the democratic society to vote to raise the legal upper limit on allowable personal wealth.
There is, in fact, strong economic incentive for those who are at or near the upper limit on allowable personal wealth to be successful in improving the General Welfare. For if the current level of MAW is not producing sufficient improvement in the General Welfare, as democratically determined, there is the possibility and probability that the democratic society might democratically decide to reduce the MAW limit even more in order to enlist even more still-wealthy participants and their extra wealth in the proper and noble task of seriously improving the well-being and welfare of society in general.
Democracy. There is a simple procedure by which each individual participant in a democratic society (or each member of a democratic legislative body) can directly vote her or his particular preference for an amount, magnitude, or quantity of something in question, with the democratically determined, societally or legislatively desired amount unequivocally resulting. As if to emphasize the significance of the discovery, Duncan Black and Economics Nobelist Kenneth Arrow independently and more or less simultaneously established the important yet simple mathematical result and procedure a half century ago.
Their now-classic social choice contributions have provided the theory which shows that the median value of the participants' (voters' or legislators’) personal preference distribution is the amount the democratic society as a whole is "for" -- assuming the minimal operational “one participant, one vote; majority rule” decision-making process. Roughly speaking, this means that the democratically determined amount is such that half the voters want that much or more while the other half want that much or less.
Assuming a vote for UGI equaling zero represents a voter wanting no UGI, and MAW equaling infinity means a voter prefers no limit on MAW, SeD embraces all four generic variations. That is, there can be democratic societies wherein there is a nonzero UGI and finite MAW (the standard and most effective form of SeD); zero UGI and finite MAW (system with many merits!); nonzero UGI and infinite MAW (legendary problems: how and how much to finance the UGI?); and zero UGI and infinite MAW (similar to the current situation, but at least democratically approved and apparently acceptable). Beyond these four fundamental variations of SeD are, of course, the wide ranges of possible magnitudes of the UGI and MAW levels, democratically set. The four generic variations are summarized in Figure 1:
Figure 1 - Four Generic Variations of SeD
UGI = 0
MAW = ∞
UGI > 0
MAW < ∞
UGI > 0
MAW << ∞
UGI > 0
MAW < ∞
Perhaps needless to say, the same voting procedure (quantitative democracy) can be used to democratically resolve a wide variety of other questions concerning magnitude, arising in many different realms and levels of society. Staying in the socioeconomics field, examples could be a democratically set maximum income limit and/or a democratically set max-to-min income ratio.
Approximations. The many practical political approximations to SeD (specifically, UGI) include numerous alternative systems for guaranteeing some minimum amount of general, restricted and/or conditional purchasing power or guaranteeing some minimum amount of essential goods and services (the closest approximation here might be providing for prisoners in jails) that would more or less approximate the theoretical concept of UGI buying-power. Other approximations to UGI are public schools, hospital emergency rooms, stakeholders’ rights, “Baby Bonds” and micro, mini and midi low-interest loans (all determined democratically) to billions of people who yearn to have the opportunity to live up to their unquestionably beautiful and productive potential as a contributing and happy human being.
Yet another (type of) approximation to the ideal theoretical model of UGI might be gender-dependent; there could be and is quite reasonable justification for only and all females receiving the “approximated, and not completely universal” UGI. Yet again, perhaps all males might be guaranteed one half of the basic UGI that women are guaranteed; that would, of course, be a closer approximation to the ideal theoretical unqualified universality of UGI.
Perhaps the closest approximations to a limit on personal wealth are the various possible taxes on personal wealth, which, if that wealth tax is taken seriously, as most taxes on the “lower” classes are, can have a somewhat similar though less effective and slower desirable impact than the MAW limit, democratically set. Democratically established Inheritance taxes and limits on enormous wealth transfer could be considered “time-delayed” approximations to a democratically set limit on personal wealth.
One, of many, approximations to the democratic ideal of directly involving all participants of society in deciding the desired limits of UGI and MAW is the situation characterized by different political parties and candidates advocating different amounts for the two bounds, depending upon their particular understanding of the General Will of the democratic society. If democratic procedures were followed to determine ascendancy to political power, it would seem the winning political party or candidate might be said to have spoken (approximately) for the democratic society as a whole. Proportional representation would, of course, help smooth such rough approximations.
Justifications. There are numerous justifications for Socioeconomic Democracy, from a variety of different realms of inquiry. Admittedly no more than merely mentioning names here, those interested are urged to consult our original works on the subject.
Anthropological justification is proudly, respectfully and gratefully obtained from Ruth Benedict, in her pioneering analysis and potential engineering of low and high synergy societies.
Philosophical justification can be more or less obtained from John Rawls' classic theory of justice as fairness, not to more than mention Tom Paine and numerous others.
For psychological support, one could consult Abraham Maslow, and should consult Charles Hampden-Turner's Radical Man, and must consult Erich Fromm's "Psychological Aspects of the Guaranteed Income" and Paul Wachtel's "Poverty of Affluence," among numerous others.
Regarding religious justification for something like Socioeconomic Democracy, where to start?! Jesus' observations regarding a camel, the eye of a needle, a rich man and entry into God's Kingdom might get us going in a desirable direction.
Of course, the essence (respected or violated) of all worthy religions is their common sharing of the Golden Rule, from which, among other things, Socioeconomic Democracy can be logically derived. We limit specific reference here to Economic Justice for All, prepared by the US National Conference of Catholic Bishops, and simply note its similarity to the work and conclusions of numerous other denominations, religions, nationalities and organizations.
Perhaps it should be pointed out here that there is significant conceptual similarity between Socioeconomic Democracy and a fundamental aspect of Islamic economics, namely, Zakat, one of the Five Pillars of Islam. Zakat is essentially a moral tax on wealth to benefit both the giver and the receiver and to realize and maintain sustainable development for all. Interestingly, the prophet Muhammad’s insistence on thoughtful consultation with all those affected by a particular matter before that matter was to be decided and resolved is strikingly similar to western democratic theory, though preceding it by a millennium.
In keeping with unfortunately frequent contemporary practice, we here deal with Human Rights lastly. It is recalled that on December 10, 1948, the General Assembly of the United Nations adopted and proclaimed the Universal Declaration of Human Rights. Although it certainly could do no harm now to review all of the Declaration, two Rights are particularly germane to our truncated list of justifications for some form of Socioeconomic Democracy.
Article 25 (1): Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.
Article 29 (2): In the exercise of his rights and freedoms, everyone shall be subject only to such limitations as are determined by law solely for the purpose of securing due recognition and respect for the rights and freedoms of others and of meeting the just requirements of morality, public order and the general welfare in a democratic society.
These two Articles can be succinctly synthesized as Universally Guaranteed Personal Income, democratically set and paid for.
Feasibility and Implementation. Suffice to say here that the major aspects of implementation, including possible voting procedures, administrative and legal technicalities, parametric economic analysis and system simulation, as well as political considerations of instituting various forms of Socioeconomic Democracy have all been extensively considered and are available. Socioeconomic Democracy is quite feasible and implementable -- requiring only an informed, functioning democracy.
For example, consider the political aspects of implementing some form of Socioeconomic Democracy. Note first that bounds on guaranteed personal income and allowable personal wealth, democratically set, can not be realized until at least a majority of the voting citizens in a contemporary politico-economic system learn about, understand and favor such a Democratic Wealth and Income Distribution Boundary Controller Subsystem. Actually, of course, it can be anticipated that something more than a majority of the citizens of a democratic society will have to favor a democratic resolution of the matter before a democratic resolution of the matter can be realized. This would be especially the case if a Constitutional Amendment were required, which would be quite reasonable and indeed desirable.
In any case, coalitions of political parties, committed to passage of the necessary legislation, are one possible adoption procedure open in some societies. On the other hand, being an alternative to all existing economic systems, Socioeconomic Democracy provides a well-defined, humanistic, just and democratic focus about which a new or rejuvenated popular political party could (re)organize and (re)capture political power.
Prior to the legal establishment of an actually democratic bound-setting procedure, these political parties could, as earlier mentioned, propose specific magnitudes for the bounds, which would reflect their understanding of the General Will of that society. At least for the necessary transitional phase, this procedure might be considered a quite reasonable approximation to the ideal theoretical model.
Sustainable Development for All
Elsewhere, it has been described how numerous serious societal problems would/will be significantly reduced or more or less eliminated with Socioeconomic Democracy. Moreover, these numerous serious societal problems would be reduced or eliminated simultaneously. This is the essence of Sustainable Development for All, as well as an example of a realizable Utopia.
Earlier, we mentioned how SeD would both create economic incentive and provide necessary funds to encourage and cause significant reduction in unnecessary individual, societal, and global problems.
These problems include (but are by no means limited to) those related to: automation, computerization and robotization; budget deficits and national debts; bureaucracy; maltreatment of children; crime and punishment; sustainable development; ecology, environment and pollution; education; the elderly; the feminine majority; inflation; international conflict; intranational conflict; involuntary employment; involuntary unemployment; labor strife and strikes; sick medical and health care; military metamorphosis; natural disasters; planned obsolescence; political participation; poverty; racism; sexism; untamed technology; and the General Welfare.
It should be kept in mind that these highly desirable outcomes of reduced societal problems are not simply “goals” for a better world, but rather are the direct and predictable ramifications of adopting some form of Socioeconomic Democracy.
One example must suffice. Consider international conflict, that is to say, war, that perennially popular, profitable and productive form of planetary depletion and pollution production mentioned earlier.
To begin with, the enhancement of societal well being made possible with Socioeconomic Democracy (i.e., the synergetic effect of simultaneously reducing a wide variety of current society’s many other serious problems) ipso facto provides an effective and positive deterrent to international warfare, here assumed undesirable and to be eliminated. The simultaneous resolution of a large number of serious societal problems eliminates at once many causes of -- and far more importantly, many excuses for -- war.
Beyond this, other specific beneficial effects can be anticipated. For example, those participants in the democratic socioeconomic system who are personally at or near the societally (i.e., democratically) set upper bound on allowable personal wealth would no longer have personal economic incentive to promote war or military intimidation, whether involving their own country or other nations, for private profit, as is frequently the case now. They could no longer gain personal wealth by such action (due to the MAW limit) and could well lose it, especially if their society democratically decided to further reduce the allowable personal wealth bound to help finance involvement in any necessary hostilities.
Democratically set, societally (governmentally or otherwise) guaranteed personal income for everyone also provides many direct deterrents to warfare. Among numerous other strong effects, it would eliminate any economically "handicapped" class, which, of course, has historically provided warring nations with a convenient pool of combatants.
Such guaranteed income also solves the very real and almost always neglected problem of necessary income for all those who presently derive their personal income and personal wealth from warfare, its design, profit, threat, fear, preparation, or promotion, either directly or indirectly.
All this reduction of “war” makes available, among other things, needed funds for Sustainable Development for All. Far more importantly, perhaps, it provides a fundamentally different and far healthier mindset for humanity.
Yet if some war is absolutely “necessary,” both democratically set MAW and UGI bounds, and the economic incentives they create, would go a long way to insure that all military personnel are provided adequate care (financial, medical, psychological, educational, therapeutic and otherwise) to meet their requirements for attempting to salvage a deservedly respected, dignified and healthy life, both during and after their military service, as opposed to not uncommon current conditions.
One thing is clear; for humanity to reach, realize and retain Sustainable Development for All, it will have to be thoughtfully fearless and fearlessly thoughtful in its determination of all that must be changed and improved. Humanity will not earn the gift, nor will it be given, otherwise.
The defining and explanatory document of Socioeconomic Democracy is the book Socioeconomic Democracy: An Advanced Socioeconomic System (Praeger, 2002). For more information on SeD, please visit the website of the Center for the Study of Democratic Societies.
Feedback is kindly requested: Robley E. George