Social policy ǀ What wealth can do – Friday

by time news

Great promises were made during the election campaign. “Sustainability” – it blinked from many posters. But sustainability is more than just ecology: Much more complex than complying with CO2 requirements is social sustainability. It means nothing other than a comprehensively responsible design of the social system. Our real existing social system, however, is currently decisively determined by capitalism and thus economically. So it will come as no surprise that social sustainability essentially touches on the system issue – and is often neglected. Because it poses the question of distribution. Every future federal government should be given: Responsible shaping of the future cannot ignore the question of distribution.

Actually, the conditions would be good to specifically address distribution issues. Germany is a rich country. But there are numerous hurdles – including intellectual ones – to be overcome. The protection of private property and its income is also financed by those who have only marginal or very little property. In The code of capital Katharina Pistor clearly worked out this asymmetry. It has a long history and is the basis of today’s distribution problems. We live in a time in which even companies are increasingly talking about “corporate social responsibility” and “shared value”. Innovative concepts are required in order to give a clear framework to the responsibility that arises from private property.

In principle, the following applies: The state creates structures that are intended to reduce the uncertainties in the system. Currently, the risks are distributed very differently: the threshold to the risk of poverty is set by the Federal Statistical Office at an annual income of 14,109 euros for a single person. The inequality was already great before Corona, it can be assumed that it has worsened in the wake of the pandemic. Many mini-jobs – already a social concept close to poverty – have been terminated. Child poverty is repeatedly regretted in the media, but it does not cease to exist as a result.

View to Scandinavia

Unequal distribution of income and wealth also means an unequal distribution of existential problems. There are no international government meetings on the subject of “social sustainability”. The subject has a harder time than others. European solutions to problems have long been known. Anyone who doubts this should look to the northern European countries. Of course – fighting inequality costs money. But there is enough money. The public sector debt is offset by gigantic private wealth. Sustainable financing of intelligent, distribution-oriented social policy inevitably raises the question of higher taxes for people with very high incomes. Of course, a wealth tax, but also the inheritance tax, must finally be put back on the rails. Don’t worry – the average net worth of private households is just 160,000 euros. That would of course not fall under such taxation. What is meant by the wealth tax is the wealth of millions.

Germany’s governments and administrations have been working according to the motto: The problems are known, we will address them later. However, postponing problem solving into the future means that they will become significantly more expensive. It is therefore imperative that the state show its will to shape social policy: starting with the minimum wage. This must be increased significantly so that a poverty-proof income can finally be achieved through work. The planned twelve euros only help to a limited extent. The idea of ​​the large low-wage sector does not carry any society into the future.

Mechthild Schrooten is Professor of Economics at the University of Bremen and member of the Alternative Economic Policy working group

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