From Cradle to Capitalism

This was written likely Sophomore Year of College

One of the most significant, if not the most significant, arguments against classic liberalism is that there is a lack of equality within society. It is argued that having a world of minimal government and capitalism would not be fair to those who start life with less than others. All individuals are not born into equal circumstances. Therefore, in society, some will start their lives disadvantaged compared to others. This is the premise to the aforementioned argument. Since people are not equal starting life, it is not fair for person to have to compete in the liberal society with those who have great advantages.

Some suggest that the solution to this problem is through expanding the welfare state and try to create equality for all. However, there are other individuals who prioritize freedom above equality and do not want to sacrifice freedom for this equality seeking welfare state. This is difference is the root of most debates regarding the role of government. Therefore I propose a compromise. Let’s have the government provide everyone an equal start. After everyone is equalized, they will enter society where government has minimal influence. Having this new world would be fair because everyone starts equal, the playing field for capitalism is level. We will then have equality and freedom.

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There is now the question of how do you create this equal start. I am looking to implement this system in the United States, so I will only look at that system. To work on the start, we work on the start of life, the young. I propose a dramatic shift from the focus of social welfare from the poor and elderly to the young. This shift will help create the equal start we seek.

My proposal is this: Reallocate the money currently spent on Social Security, Medicare, and Medicaid and move it to education and health care for the young. We will be front loading the social welfare programs to equalize the young. We make a primary investment into education and health care starting at the cradle. We give everyone an equal education and government assisted health care until they are 24 years old, and then we have them enter a world of capitalism, i.e. freedom. Therefore we will create a welfare state from cradle to capitalism. In the capitalist part of society, the social safety net provided by the aforementioned US social programs would be vastly reduced. However, this is acceptable because everyone would have received an equal start.

An immediate argument against this system would be that reallocating money towards education will not solve the problem. For example, Washington DC has one of the highest money per student ratios in the nation but some of the worst schools. This is a very valid point. However, I would propose that the solution to the education problem is to get better teachers and smaller classes. The way I would get smaller classes is to hire more teachers. Then there is the question of obtaining better teachers.

More people would more seriously consider being a teacher if the pay was better. Currently the average starting pay for a teacher is $25,000 – $35,000. Many prospective teachers have abilities and skills that have more potential earning power than this low teaching salary provides. I would propose to increase this to $100,000 through a $65,000 – $75,000 federal supplement to every teacher’s pay. The goal is to make more people want to be teachers to create a surplus in demand for teaching positions.

However, if the system can reward the aforementioned person’s skills with comparable pay to being an expert, i.e. the doctor position, in their field, then more people will desire to be teachers. Through this high pay system, demand for teaching positions is created. The supply of teacher positions would only change based on population. Therefore you have a fixed supply and large demand. Therefore creating competition for the limited number of teaching positions, and then the system can select best people to be teachers. Not just those who willing to have lower teacher salary.

One could argue, that with this system you would have teachers who are simply greedy people. However, the demand would be extremely high for the teacher positions. The greedy people would just be in addition to those who simply want to teach for the sake of teaching. The “for sake of teaching” people will not go away. I surely doubt the people would change their mind about being teachers simply because they do not want to be paid more money. Through this new demand for the teacher positions, competition would occur. Then the system could select the best teachers and not have to desperately search for anyone willing to teach for the low pay. The goal is to have excessive demand for teacher positions with limited supply to fill the supply with a higher quality of teacher.

Another could argue that the better school districts would get better at an equal level to those that are currently worse. However, I do not think that this is the case. Currently the better school districts are better because there is a high demand for the higher paying teaching jobs that these districts offer. We would make every teaching position high paying, there would be no bad teaching position. Admitedly, in one school district a teacher could start by making $120,000 compared to $100,000. This $20,000 difference is not as significant because the starting salary is well above the overall society starting pay. The difference in attractiveness of jobs is lessened with the larger salaries. The difference between a $25,000 salary and a $45,000 one is a 44% difference, but the difference between $100,000 and a $120,000 is a mere 16%. The problem of difference in teacher pay will be drastically reduced.

This sort of teacher system would be enacted for the current K-12 program in the United States. For simplicity, we will have someone graduate High School at age 18. There will still be some who can and cannot afford college and post-graduate education. Therefore, equality has yet to be reached, which is our goal.

Therefore the government would then implement a personal trust fund program. Every 18-24 year old will annually receive a $15,000-$20,000 (undetermined number) deposit into this The money from this fund can be used for one of the three following essential needs: Education, Food, or Health Care.

This money can only be spent on these things. If someone would like to continue their education, they can use the money to pay for their education. This amount of money will not cover all of the costs of all universities and colleges, but there will still be other financial aid systems provided by the government similar to our current system.

There are some who simply do not want to go to college or want to a tech or trade school to learn a specific skill. This trust fund money can be used on these schools too, and if the 18-24 year old does not use all of the allocated money, they can then spend it on the other two essential needs.

Everyone needs food to survive; therefore this is an adequate essential need.

Everyone also will probably need some sort of medical attention in their lives. Therefore, the excess money in this trust fund can go to health care at any time in the person’s life.

The trust fund will only receive annual deposits for 6 years of a person’s life, but it will be with the person forever. Therefore, theoretically, a person can graduate high school. Get a 9-5 job somewhere. Use the potential $90,000-$120,000 trust fund to pay the other essential needs. For example, if the fund receives $20,000 annually. Then the person at 24 will have $120,000. This would cover health care at $3500 a year for 35 years. Therefore the person has been essentially insured by the government for health care for 34 years. These are all very rough numbers, but they are used to illustrate the idea of the system.

However, the government is not only giving in this system, it will also take away some current services. There will be no pension program or health care program targeted at the elderly. The social safety net for the poor would have to be reduced to about 5-10% of its current size. The currently payroll/pension tax would be absorbed into standard taxing in order to fund this system. After someone receives their 6 trust fund years, the government, to them, will simple maintain order and provide basic public services, i.e. building roads.

After the 24 years of free education and health care to a person, he or she then will have to make it on their own. They will be put into a capitalist society in which the responsibility is on themselves. If they are to fail in the society, they would have no one to blame except themselves. Everyone was given the same opportunity to receive and education and were raised healthy. The disadvantages of birth would be negated.