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Edited on Mon Aug-09-10 03:59 PM by Nicholas D Wolfwood
I see no reason why we wouldn't. Market forces outside the U.S. would still have a great impact on our society. Say Japan and China get into a catastrophic war with one another, for example. Those are two of the top 4 destinations for our exported goods. Regardless of the social contract in place here in the United States, we would see a precipitous drop in demand for our products, and that would spark a major recession.
Beyond that, like it or not, what you'd unquestionably be doing is increasing the cost per worker for any company. The more it costs to hire someone, the greater the hesitation a company would endure before doing so - it really doesn't matter what the reasons for that hesitation are, that is a fact of life. Furthermore, that reduces the overall number of people that could be employed by the private sector unless you in turned dramatically increased our GDP, as resources for most companies outside of the unbelievably profitable ones are limited. Even in the most altruistic of companies, if they don't have the assets to pay all 500 employees a minimum of, say, $50,000 per year, they can't do it. That means you'd struggle to find jobs for a lot of people, which would lead to maybe having a vibrant middle class, but definitely a devastated, much larger lower class. Finally, unless you enforced our social contract around the world, there would clearly be greater incentive for companies to further outsource labor, again, reducing the overall number of employed people.
What you're describing may indeed work well in a good economy and might do well to safeguard against a downturn in the first place. However, a major global event could still plunge us into deep recession, and it would take longer and hit harder when that happens.
All in my opinion only, but I don't think it's anywhere near as simple as you're making it out to be.
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