Socialism and communism disincentive workers by eliminating rewards for hard work, innovation, and entrepreneurialism by seeking to create a society where everyone is economically equal. This leads to a lack of progress and productivity, and a medicoritization of the state as a whole.
Free market economics seeks to incentivize hard work, innovation, and entrepreneurialism, or at least success in those endeavors, with economic rewards. In theory this is sound, but in practice companies are not concepts that behave according to theoretical principles but are run by humans that are able to rig the system by doing things like colluding to increase prices and decrease wages, influencing governments and media to create favorable conditions for them, and working to destroy competition using tactics such as lowering prices while operating at a loss until they hit bankruptcy then buying up their assets.
Neither system works however they both have elements that can be used to achieve desired effects. This can be done by ensuring that competition is at the heart of all commercial ventures no matter the players involved, while providing a safety net that allows those with talent to rise up and join the ranks of competition.
At the lowest level, there should be a minimum lifestyle that is available to all citizens of a society. This can be highly structured and even socialized in an isolated way, such as kibbutz’s run in Israel. Lodgings, food, and health care should all be guaranteed at a minimum level. This can mean 20 people sharing a room and eating gruel each week with only the barest health checkups to prevent and treat low cost diseases. The system should also be optional, allowing freedom for others to leave and attempt other lifestyles as they like.
Two other important aspects of this minimum lifestyle must be guaranteed. Full access to education should be free at all levels. Institutions can exist outside of this system but they should not be able to offer credentials that are in any way higher than those offered by free schooling.
The second guarantee should be a right to work. The government should accept anyone willing and able to do service into public works jobs, or private sector work, for which they will get paid a salary above and beyond that of those simply living the minimum guaranteed lifestyle. This will allow them to save, purchase, and participate in the economy. In addition, no worker earning in the lowest 25% tax bracket should ever have to pay any taxes, including medicare and medicaid. It is vital that work be incentivized heavily, and only those engaged in such pursuits will have access to luxury goods.
In addition, any small or medium company earning equal to or less than 25% of all companies in the nation should not be taxed in any way. It should be simple, easy, and fee free to start and operate a business.
Obviously this has to be paid for by someone, and that burden should fall on the wealthiest companies and individuals. A sliding scale tax rate will apply in which bigger companies pay more and smaller pay significantly less.
The downside to this is of course that large companies will leave the nation which is instituting these policies. At first glance this can be disastrous due to the loss of tax income. However, by eliminating or hampering the largest companies in the country, room is made for smaller companies to rise up, take market share, and innovate. This creates a setting where competition is free, open, and not restricted to a game played by ancient companies resting on century old laurels.
Companies that do take advantage of these policies and then leave the country when they reach a certain size should face severe tarifs. Using the resources of a nation to start and then leaving because of tax policies is tantamount to stealing from the people of that nation and should be punished accordingly.
At the same time foreign mega companies that try to dominate the market of the country enacting these policies will find a robust set of mid sized businesses ready to compete, fully supported by their governments regulations and tax policies. This will allow them to develop into more powerful entities, that will continue to compete with each other and foreign entities over lower prices, higher wages for skilled workers, and better products, as no small oligarchy of organizations will be able to squeeze out competition from new and innovative startups.
This is a system that values the ideals of free market economics, while also providing the equality necessary so that everyone has a chance to compete. This is a meritocracy, where the lower classes are not forgotten, but where individuals have the freedom to succeed, no matter their background or station in life.
– political life may also run better when based on meritocracy. Requiring candidates to have served in some capacity in public office for a minimum amount of time can result in better administrators that are more skilled at enacting their promises, while preventing demagogues from using personally gained fame to acquire political power.
– Voting may also be restricted to individuals that have served in some capacity in the government. This however will only work if the rights of all people to enter such fields remains unimpeded.