What would reduce the poverty rate?

[The Right Honourable Martin Brian Mulroney PC CC GOQ]

UBI, while not currently feasible in most countries, should be the ultimate goal. Building more housing, including subsidized housing, is a more short-term thing we can do.

Workers are squeezed because the value of labour is only going down thanks to technological development. Governments try to correct for this by increasing the minimum wage. While this is a good short-term fix, it's just that, a short-term fix. All you're doing is artificially making labour more expensive without dealing with the real problem - the low value of low-skilled labour. Economic output is higher than ever and keeps increasing - even with COVID, something that theoretically should have crashed the economy, most economies stayed relatively afloat (in terms of overall output, of course real economic conditions have been atrocious for many people), and it's only bouncing back. But wages haven't kept up because the value of labour is only going down. Some of it is down to a decrease in unionization, some of it is down to free trade. Many would argue that we need more unions and less free trade, and that's a reasonable position, but neither of those address technology and automation. When you can do more things while employing less human labour, the value of human labour goes down.

Some would say this calls for socialism, but I'm skeptical. Workers seizing the means of production doesn't seem like an attainable goal at this point. The means of production are increasingly advanced and require more capital input, which puts a worker-owned economy at an even greater disadvantage. But wages are stagnating, prices are going up, and the traditional welfare state model is increasingly inadequate at dealing with these challenges.

The welfare state was created when most people could find a decent enough job to live on, and welfare was a fall-back option for when they couldn't. Means-tested programs where people without an income get support make sense when people who are working don't need much government support. But now, even people who are working are often struggling to get by. Where I live, in Ottawa, Canada, the average rent for a 1-bed apartment is $1495/month according to one source. If you work minimum wage ($14.00) 40 hours a week, your gross pay is $2240/month. Even if you don't factor for taxes, an average 1-bed apt would take 2/3 of your monthly income. You can increase the minimum wage, but a higher minimum wage doesn't increase how much an employer values a worker's labour. If anything, it decreases it in relative terms by making labour more expensive, which will only lead to employers seeking cheaper methods like AI, which only decreases the value of labour, and so on.

Affordable housing is a relatively easy fix. We need more supply, which means zoning regulations should be relaxed and amended to create more multi-family units (apartments, townhouses, etc). There's plenty of space to build if we can just overcome the NIMBYs and build higher, not wider. Along with this goes public transport. The reality is that urban cores will always be more valuable (therefore more expensive) than suburbs, and people who can't afford cars are stuck with either even more unaffordable downtown apartments, or literal crackhouses where they share a floor with five other people, twenty rats, and who knows how many roaches. Public transport allows cities to expand more sustainably.

But the free market and a little infrastructure spending won't fix the issue. On the other side of my country, in the beautiful city of Vancouver, there is excellent public transit and plenty of high-rises and mixed units. But it's still one of the most unaffordable places in North America, in large part because wealthy, often foreign investors, are buying up all the units. A real estate developer would rather develop luxury condos for a Chinese billionaire to drop money on, rather than a reasonable apartment building that working-class people can live in. The way to correct for this is to build affordable units. This can be done through zoning that prioritizes these kinds of units, subsidizing low-income housing, or both. You cool the rental market by making low-rent units more available.

I focus on housing because that's what causes a lot of poverty. For most people, rent/mortgages are their biggest expense.

UBI is more long-term, but that's a policy that could actually eliminate poverty. Apart from the obvious benefit of increased disposable income, it also gives working people more bargaining power. If you're already guaranteed $2000/month (or whatever), you can choose whether or not to take that job at Walmart, or how many hours you're willing to do. In other words, people aren't stuck making poverty wages at dead-end jobs to avoid starvation. It also helps people adopt to a gig economy. Uber shouldn't be something you rely on for your primary income, but if you're already guaranteed a good bit of income, driving around a few hours every night delivering McDonald's to hungry stoners provides a decent top-up.

How do we pay for it? I think UBI should not be paid for by increasing income taxes. Even with a UBI, ideally you want people working, so they can add more value to the economy, which eventually goes to fund UBI among other things. However, corporate productivity is going up, and labour costs are going down. We can increase corporate taxes gradually to help fund UBI, as well as other revenue sources associated with increased corporate productivity.

And finally, I think universal healthcare (or at lease subsidized health insurance system like most European countries have) would go a long way in the states. Medical bills are a huge source of financial insecurity, and a monthly check from the government doesn't help alleviate the ridiculous levels of medical debt people have.

Edit: I think the bottom line is, we're getting closer and closer to a post-work economy. This is a good thing. A lot of people derive enjoyment from their jobs, I personally do (somewhat, work is still work). But for most people, work is what you do to make ends meet. As long as human labour is the primary input that creates wealth, work is unavoidable, capitalism or not. But increasingly, human labour is losing its importance. I think a lot of people on both the left and right get this upside down - instead of trying to artificially increase the value of labour, whether through higher minimum wages or less free trade/immigration, we could accept the fact that labour is losing its value, and try to build an economy where this doesn't lead people into starvation. In other words, #YangGang. As far as housing, I think there's a pretty reasonable and relatively easy solution that governments loathe to take action on because they don't want to piss off NIMBYs and landlords. But you have to break a few eggs to make an omelette.