Bildsten, William Henry

This blog is a repository of my ideas and thoughts (or at least the ones I wish to share). All comments and questions are welcome.

Metropolitan Evolution

The world has changed, and it keeps on changing. Humankind started somewhere and, from there, somehow spread into civilizations across the world. From Hammurabi’s Law, to Athenian direct democracy, to Roman imperialism, to a long era of feudalism and monarchical wars, humankind has continued to rediscover how we governor ourselves (or, often times, how few dictate the majority.) The United States was once a newly independent civilized power of the Western Hemisphere that rejected nobility, promoted Darwinistic liberty (which was preferable to be being born in a class from which one can no escape,) and was concerned simply that its own side of the Atlantic (and eventually the Pacific) was free from the imperialistic inhumanities that plagued the Old World. Beginning with Teddy Roosevelt’s journey to rid the then-malignant Spain from our hemisphere, and developing with American leadership in two dreadful world wars that reshaped world order, the United States has found itself on top of the world, a position hard to give up, even for a country founded on principles that didn’t even slightly promote the idea of being an omnipresent military power.

Fast forward to today: the developing world is developing, and all of the developed world, except our great nation as of this past couple years, is fading to make way for a global world in which no single nation will unequivocally “be on the top.” Our world is becoming global, as democracy and internationalism spreads, and the definition of “where we’re from” is transforming, as it had already moved from colony to State to nation. In our modern society, Americans belong to their metropolitan area, and in another layer, to their local community. As the world globalizes and localizes, The United States needs to adapt our own domestic policy and order to recognize the rise of global localism.

The New York metropolitan area exists in New York, New Jersey and Connecticut. The Philadelphia metropolitan area exists in Pennsylvania, New Jersey and Delaware. The Chicago metropolitan area exists in Illinois, Wisconsin and Indiana. Despite that metropolitan areas have so little coordination with the State or States they exist in, metropolitan areas remain to be an idea but not a reality. Our country is full of countless counties, many of which have as many people as a few towers in Manhattan, but those counties, like States, arbitrarily divide metropolitan areas or misrepresent rural areas, due to their outdated and unnecessary borders. Our country needs to adapt our government to our societal reality: a nation with metropolitan areas and local communities within those metropolitan areas. Counties should be abolished, and States should hold more limited functions. It is both conservative and progressive to allow decentralized government, and I can assure you States aren’t the best example of that.

Our federal government should work in conjunction with metropolitan areas and communities, not in spite of them, by giving localities direct power in running our national government. Our federal government can maintain responsibility for national defense and security, old age entitlements, diplomacy and the progressive distribution of revenue to metropolitan areas, so that metropolitan areas can have adequate funds to manage their own needs more effectively. Ideally, our federal government’s system must change. We should reform Congress into a parliamentary system with population-proportional districts that avoids deadlock and requires cooperation. We should also have a reformed Senate that consists of delegates from each and every metropolitan area or rural region, for which each delegate’s voting power would be proportional to its metropolitan area’s or rural region’s population. We must still elect a President, but that President should hold a role of Commander-and-Chief, head of foreign policy, and Head of State, but not that of dictating our diverse nation’s domestic policy.

Metropolitan areas or rural regions can raise revenue through progressive property taxes, in which every homeowner would receive a generous flat federal rebate on taxes, and in which every household would be entitled to a cap on its property taxes relative to their household size and income. Under such a system, regressive and harmful sales taxes could be abolished, and income taxes would be levied solely through the federal government, to prevent flight to tax havens. Metropolitan areas and rural regions could determine their own systems of governments, as long as their governments have progressive systems of property taxes, as long as their politicians are directly elected, and as long as those directly elected governments allow their residents to elect their metropolitan Senator through popular vote.

Metropolitan areas in conjunction with small, self-defined communities could decentralize some political and certain revenue powers to community governments, further representing people as they should be in the 21st Century. Rural regions that function like metropolitan areas could also allow their rural residents to form similar communities. (In fact, I envision that many rural regions would decentralize much of their governments, due to the lack of density.)

More and more, we see that mayors or councils of politically like minded cities can get things done, and I think it is fair to assume a decentralized form of government that represents humans in modern fashion would have the potential to make our country work for all Americans. Of course, the problem with this theory is that it’d take quite a bit of effort and support to pass through as Constitutional Amendments. Despite that, I am confident our Founding Fathers would see this as a just adaption to our changing world, and I’d hope today’s citizens and politicians could agree on that. Our country needn’t move left or right, but forward, so it’s worth my, or any good citizen’s, effort to give enough of a damn to keep America great through positive evolution, as humankind has endured since its inception.

The Cost of Systems: Urbanism’s Potential to Save the Middle Class

The cost of upholding America’s systems that defend our way of life are egregiously expensive. For a large majority of Americans to own a house, own a car to get to and from work, to cover health costs, pay down school debt and more, $30,000 isn’t much. But, in all possibility, $30,000 could be a lot of money for an individual, and in a society without invasive taxes, too. The key to such a society is systemic transformation. With inequality accelerating, even under a liberal President, Americans need to realize that globalization and technology are the real culprits of this continual trend. A government can’t de-globalize our country through rate increases or rate cuts: it can only help the middle class prosper through smart systemic change. System change could be nothing more than an ideal, but what if?

In the Minneapolis-St Paul metro area, only 20% (about 700,000 of around 3,500,000) of the population lives in the principal cities of Minneapolis and St Paul. In addition, many in those principal cities, including my family, live in a single-family house with a front and back yard. MSP has a destabilizing deficit of non-luxury rental supply. Not every person or family can afford to take on a mortgage (with total interest often exceeding the cost of the house itself, despite a sprawl-accelerating mortgage interest deduction and the potential profit of homeownership.) Having high (although, in Minneapolis-St Paul’s case, extremely racially disparate) rates of homeownership is an indication of economic stability in American culture. Unfortunately, condominiums have been proved a failed investment for the Minneapolis-St Paul metro area, and I’d expect the same thing to happen again. (The most notable reason being that condos are designed almost always to fit a design trend, which results in an inevitable decline in value, as trends are trends.)

Because Minneapolis-St Paul is so spread out, the average metropolitan spends as much on transportation as on housing. The costs of housing and transportation alone make being a part of the middle class, in a society with three decades of stagnant wages failing to keep up with inflation for the large majority, a difficult task. Additional necessary costs (health insurance, food, necessary household products and education) become a burden of responsibilities to manage (and one wonders why there’s large personal debt, albeit less than the national average, in the MSP-area.)

The inflation of education and health insurance are making the middle class, relative to the cost of living, a fading society. There are models for making higher education attainable, like Oregon’s model to tax all graduates a very small percentage of their incomes after graduation for a couple decades or so to fairly cover the costs of Oregon’s state schools or universities. That model, although, in the form of a tax, would cost significantly less, as the burdensome financialization of school debt would be eliminated. In the form of health care, I am an unapologetic fan of private health insurance to ensure patient choice and to prevent the rationing of care (which does happen under single-payer systems,) but I feel like our private model could desperately need pricing negotiations among the government, insurers and providers to put a negotiated cap on health inflation, as is done with Germany’s private health insurance system. Our healthcare system should also entitle the patient mandatory pricing transparency available from any hospital or provider, so the customer can find himself/herself or his/her insurer best deal within his or her proximity. Not to mention, driverless urbanism encourages healthier people, so cultural change alone would make dramatic strides for lower healthcare costs. Many onerous regulations from ObamaCare won’t truly lower core inflation, but simply subsidize it so, at face value, costs would seem lower for many. With reasonable subsidies evening out a system with lower core costs, a private healthcare model that is both affordable and free-market could flourish.

Now to the idealism. In an urbanist society, people would live in enough density to support mass public transportation, live in denser, more vertical condominiums in which more activities could be done outside the home in nearby shared condominium building facilities, in public facilities or via local private businesses. A sharing economy can make all the difference in the standard of living. The greater the density, the more affordable transportation becomes, making it easier for such an intra-metro transportation system to be fully publicly subsidized.

So, all transportation costs would be publicly funded, and healthcare would be subsidized under a smarter private system for many. The final ‘arrow’ of this plan would be to create a new model for homeownership that would serve a dual purpose for everyone: providing a decent home and simultaneously ensuring a comfortable retirement.

In the utmost ideal situation, all dense urban property would be purchased via a new private model with public involvement: ‘pay-as-you-own.’ Banks would sell developers’ housing units to residents in a pay-as-you-own model in which every payment made to to the house would become a relative amount of equity. The government would insure the transition of the property’s ownership, so that every dollar in payment translates into a dollar (with a potential for appreciation) of equity, and so that the government could temporarily hold ownership of equity for a bank before a property is resold. Once a housing unit is no longer being purchased and the equity is in transition to a new buyer, any equity transferred to a government-managed retirement investment account would be tax-exempt. However, if the equity, before retirement age, were not put away for retirement, it would be taxed on its principal value and taxed significantly more on its equity’s appreciation. Under this model, all housing costs, including utilities, would ideally be bundled into the payments. Housing could become more expensive under such a model, but higher housing values would translate into better retirement security, freeing the workforce from seniors unable to yet afford retirement. Every citizen would be entitled to built home equity. Lower-income people would even be assisted by tax deferred housing payments (where future income taxes would repay payment subsidies only if a homeowner has enough eventual income to do so.) Housing subsidies’ equity would only be redeemable for retirement savings, making one’s home his or her ticket to a sound retirement.

To make a society in which poverty is non-existent (noting a poverty-free society is very good for everyone’s economy), every person would need a basic income to provide themselves what they need. As this society would eliminate, reduce or merge major costs, an income of $30,000, as said earlier, would be a very nice income to live on. A basic guaranteed income for people working as much as possible up to full-time, paired with a localized system to pair people to employment, would entitle everyone to a very basic living, relative to family size, as long as they make an effort to be self-sufficient (as full-time hours under a minimum wage would provide above the cost of living, making such public income subsidies dependent on the job market and work ability/skills.) A guaranteed basic income program, one that full-time minimum wage workers wouldn’t need to utilize, would be much more financially efficient that bureaucratic vouchers. All public spending (for urban maintenance, transportation, law enforcement, education, welfare, military, etc.) would be funded through either home equity taxes on non-retirement equity or through a simple, flat income tax and a reasonable, flat wealth tax only on higher earners, making a system in which being a part of the middle class is attainable for many, many more people.

The key to saving our middle class is making the cost of living attainable. The current way of life, or rather system of living, in the US makes that very hard to do. Our nation’s dependence on loans, debt and sprawl create a greater schism between haves and have-nots. Urbanism isn’t elitist: it is populist. Minneapolis-St Paul politically couldn’t (for various reasons) adopt this system, but our metro area must take strides to be a more liveable, connected city that is not dependent on banks and loans for middle class security. Systems matter. Can we find a medium in our metro area or in Western society in general that balances our culture with a smarter urbanist system of living? I hope we can, and I know we can do something better if we make an effort to.

It’s Time To Get With The Times

The ideal that America is blessed by God is false (as all of humankind is purely equal.) However, the reality that America has the right formula, as a result of its industrious and innovative population, is exceptionally true. The United States rejects nobility. It rejects that, by government definition, anyone is entitled over another. Our sense of equality has evolved from keeping the government from creating inequality to having the government tackle inequality through social services and old age entitlements. However, despite changes in policy over two centuries, the United States lives by the lifestyle of entrepreneurialism. This lifestyle has ensured America’s formidable prosperity.

The world is changing. The world is equalizing. What America is doing right, virtually only in the private sector, is that we strive to solve problems through business. Our businesses and non-governmental organizations are the reason why, despite our great post-war odds have withered, we have not yet, nor will we, falter. (Look up and compare the United States’ GDP growth and unemployment rate post-Great Recession versus other first world countries.) Despite the continual successes, America needs to wake up and remember that when the world changes, our whole system must as well.

Globalization and technology (not tax policy) have propelled income inequality since President Carter’s Administration (yes, surprisingly not since Reagan’s.) This is not, by any means, an intended outcome, but it is, by all means, collateral of global structural transformation. Yes, it’s true that the bottom half earners in America have, in effect, the same income in dollar-amount as thirty years ago. And, yes, it’s true that inequality can end a civilization. America cannot afford to allow ourselves to fall into an abyss of only haves and have nots. We need a better middle class. Part of that requires a stronger manufacturing and industrial economy, which is already returning due to rising costs of Chinese manufacturing (as China is the only country with the infrastructure and systems to accommodate advance manufacturing needs.) So, to be blunt, America must get our public sector sh*t together.

First of all, only three levels of government should exist: federal, state and local. Municipalities (local governments) need the power to collaborate and share government functions with other nearby municipalities (like multiple cities sharing schools or parks) to save their taxpayers from burdensome multi-level local bureaucracy. Furthermore, states should take a stronger role to provide need-based aid to less wealthy municipalities.

The federal government, too, needs to get its act together. A large majority of non-security or non-defense discretionary spending should be fully decentralized and federalized to states for more effective management. The federal government should also provide significant financial aid to states, based on the factors of median household income relative to the rate of poverty.

The federal government, moreover, needs to understand that it can not be trusted to manage people’s livelihoods: the federal government must end porous voucher programs like SNAP and Medicaid and replace them with a truly progressive basic guaranteed minimum income that would require full-time employment or locally verified search for full-time work for a federally guaranteed income equal to 150% of the poverty level, paid for partly by states using the discretionary spending formula above. Lower-income families with children would be provided basic increases in guaranteed income.

Medicaid and Medicare would merge into a private insurance program that all insurers would have to cover with a stringent 5% overhead cap. The insurance would pay at Medicare rates for healthcare (and hopefully higher rates in the future, as hospitals are being squeezed by recent cuts to providers for Medicare.) For lower-income non-elderly Americans, it would be funded in up to three ways: hourly employer health coverage contributions (so Walmart has to pay per hour, on top of the minimum wage, and not force its workforce into part-time as ObamaCare is causing), personal means-tested premiums automatically subtracted from a guaranteed minimum income, and from federal and state subsidies. Medicare for the elderly would be phased in from either Medicaid or from private insurance over five years before it fully provides insurance by age 70 (as many Millennials will live and work longer than prior generations.) The program would require means-tested premiums from either retirement investments or any forms of available income.

Social Security would be fully privatized into a 13% tax on employers’ combined employee income and ownership income, which would be invested in government-approved, low-risk stocks or bonds for significantly higher long-term growth in funds to provide better retirement benefits. All retirees would receive a guaranteed minimum retirement benefit paid for by a benefit cap for the highest income earners (as all income would be taxable). Stocks being used for benefits would be insured by the federal government to a necessary level for every retiree, eliminating the risk for the beneficiary (meaning the federal government, as collateral, would spend more money in bad stock market.)

As employee payroll taxes would be abolished, the average worker would have more money in his or her pockets. Federal taxes would shift their focus to tax income or wealth that fuels inequality rather than taxing the middle class to perpetuate a cycle of take and give. Wealth would be progressively, but not excessively, taxed, with even higher rates for high-end real estate. Surplus savings (as many very wealthy families do not invest even the majority of their wealth) would be taxed even more to encourage investment and consumption from those with the most to spend and invest. Income derived from ownership, like from profits for sole proprietors or partners or from dividends or capital gains from investments, would be taxed relatively higher than regular income would be. In addition, only salary or wage income over, say, $100,000 for an individual or over $200,000 for a married couple would be taxed. All taxes on income and wealth would have zero loopholes. All direct business taxes, like the corporate income tax, would be eliminated to strengthen America’s corporate competitiveness. Taxing company owners rather than companies themselves is the progressive and smart way of doing things. A series of environmental taxes and consumption taxes on luxury goods and services would provide the rest of the federal government’s revenue, much of which would, as said, even the burden for states.

America needs to fix our system: we need to embrace both business and the middle class. Bureaucracy doesn’t work: government has too many layers, and the public and private sectors should combine each other’s strengths for better programs. We need a government that works to keep America competitive with strong businesses and strong livelihoods, not one or the other. America needs to fix its system of government, so that both our public and private sectors are ready for our future.

Why Mark Andrew Should Be Everyone’s First Choice For Mayor

The Mayor of Minneapolis neither signs nor vetoes bills: the Mayor’s job is to lead the city and effectively utilize the bully pulpit to move our city in the right direction. The mayorship isn’t a position of power: it’s a position of influence and collaboration. Mark Andrew, of all candidates, has what it takes. As the Hennepin County Commissioner from 1983 to 1999, Mark Andrew had the executive experience of leading Minnesota’s second largest political body, a very geographically and politically diverse region. Despite many political differences, Hennepin County Board Members of both parties supported Mark Andrew for his ability to bridge gaps of interest and make a fair deal that could work for everyone. Mark Andrew is one of few progressives that understands the art of bi- or multi-partisanship so incredibly well.

Mark Andrew is endorsed for the 2013 mayoral election by a multitude of influential unions working to protect middle class security, including, of many, the Minneapolis’ Regional Labor Federation (AFL-CIO), the Minneapolis Building Trades Council, the International Brotherhood of Electrical Workers (Local 292), Teamsters (Joint Council 32), Unite Here! (Local 17), and, notably, the lifesaving Minneapolis Firefighters (Local 82), who were unsuccessfully targeted for budget savings by harmful layoffs. Not only is Mark Andrew so strongly respected by labor, but he is supported by both small and large private sector businesses of all kinds. Minneapolis cannot afford to have a mayor that picks the industries that he or she finds worth advocating for: we need a mayor that stands for all jobs.

Mark Andrew also has the entrepreneurial experience of creating jobs: he founded and ran Real S’Mores and The World Greatest French Fries at one of Minnesota’s most cherished institutions, the State Fair. Later in his life, Mark Andrew exercised his collaborative skills with Greenmark to consult with corporations on how to realistically go green. Because of Greenmark, we can all thank Mark Andrew for making the city’s prized Target Field the greenest ball park in the nation.

Having a history of involvement in the community is important, but having a respectable record of progressive legislative accomplishments, as well, is proof of capability. Mark Andrew is undoubtedly the most progressive candidate. He made Hennepin County one of the first counties nationwide to offer domestic partnerships. He upholded Roe Vs Wade in Hennepin County to protect women’s health. He ensured that Hennepin County did its part to make the prized Midtown Greenway a reality (and he has a solid plan for another greenway to connect North and Northeast.) He utilized his negotiating skills with many different interests to make the Kenilworth Trail the awesome recreation trail that it is today. He also ensured that all municipalities within Hennepin County offered curbside recycling to their residents. Mark Andrew is the most progressive candidate because he talks the talk and walks the walk.

No single fiscally responsible action, no matter how innovative, can erase eight years of increases in the property tax levy that have threatened long-time residents from being able to afford their homes that they worked so hard to own. Voters should hold our city’s budget chair accountable for this trend that is, ironically, abating at election year. Being progressive not only means making important investments to ‘greenen’ our city, address the achievement gap, revitalize struggling neighborhoods, but also to look out for the taxpayer in a government body funded mostly by regressive property taxes.

In the same sense, voters should remember that a progressive city requires investment, and that taking a more conservative approach to investment and spending can easily make our city less progressive. Minneapolis needs to find a healthy, collaborative and innovative medium that can make our city even more progressive without pushing middle class Minneapolitans out of our city. Mark Andrew is the perfect candidate to find that balance.

What a candidate has accomplished and what their proven ability to accomplish in the future is a much more realistic expectation of what he or she will do in office than what he or she says on the campaign trail. By supporting Mark Andrew, you are supporting a holistic approach that will defend all Minneapolitans: both those in the public sector and those working for small businesses and large businesses. You are supporting a candidate that can use the bully pulpit most effectively and collaboratively to close our achievement gap, to complement our schools’ needs as a partner, rather than as a competitor, with our School Board, and to improve the urban experience for Minneapolitans in every neighborhood. Make Mark Andrew your first choice for Mayor on November 5th, and Minneapolis will continue its current path of greatness, and then some.

Unconventional economic policy for an unconventional era

Throughout the history of human civilization, people have attempted to solve the world’s economic problems. After proving failure of aristocracy, Communism, socialism, direct democracy & protectionism, the world is now attempting to perfect capitalism into a resilient, fair system.

Capitalism’ success is largely derived from its promotion of innovation and the individual initiative. Capitalism in its purest form is not practiced in modern society, considering government programs such as food stamps and social security. Austrian economics proved to favor oligopolies and widespread poverty, and therefore the need for minimal government regulation has been proven. Keynesian economics, however, has proved to be largely ineffective in the long-term. For example, the stagflation of the 1970s was in direct violation of the theory that high inflation and high unemployment could never live side-by-side. More importantly, modern political systems will allow expansionary fiscal policy in times of recession but will reject paying for such medicine in good times, due to partisan opposition against tax rises or cuts to social programs.

In my opinion, of all theories, monetarist policy works best with a combination of other theories. Raising interest rates cuts inflation, while lowering them boosts unemployment. Ronald Reagan’s tightening the money supply allowed for inflation to lower and for employment to recover. No doubt, the part of Reaganomics that had the most positive effect was changes to monetary policy. The Reaganomics theory of low regulation and low taxes definitely made an effect, although much financial and industrial deregulation was done by President Carter and Reagan’s tax cuts were never offset by spending cuts. A major downside of supply-side economics is that it helped those at the top the most. The government can be small in a way that helps the common man and not just the rich.

My general theory is that economic growth is result of innovation and human capital. The US must continue to solve problems through business, and we must have a work force ready to do so. Investments in research and development as well as in education will foster significant economic growth. Also, investment and risk taking must be encouraged by ending taxes on capital gains, dividends & interest and instead taxing exotic goods and property. There should also be a federal incentives for the working class to invest money, likely through income tax cuts. Corporate taxes should be significantly lower as well. To pay for all this, our national defense must be reformed for the 21st century, entitlements must be significantly changed, and overall, non-growth-promoting spending must be reduced across the board.

In the long-term, a low-regulatory, low-tax environment will foster economic growth, largely without economic intervention. However, in times of recession when investment is stifled, the government must take fiscally-driven steps to encourage investment from all income levels but more importantly provide generous tax cuts to the middle- and working-class to spend money to stimulate the economy (such a system would tax personal income and luxury goods progressively in times of crisis or not). Economic growth should not come from government spending, but from private-sector spending of those who need to spend the most.

A combination of these economic policies will always the US to grow and maintain its leadership in the world. Let’s create a system that rewards hard work and risk taking and, in times of need, helps stimulate consumption from the middle and bottom. Let’s stand up for growth that benefits all.