ABSTRACT
The road beyond the welfare state lies in the direction of a new form of capitalism—universal capitalism—which resolves the tension between equity and efficiency by reducing the role of wages in the distribution of income toward labor, in favor of the widespread distribution of profits and interest as an ordinary part of pay. The goal of universal capitalism is to deliver the benefits of trade and technology to all citizens, not just to the well-born and wealthy. Bruce Ackerman and Ann Alstott's proposal for the stakeholder society is a valiant attempt to force the Left to face the fact that intergenerational forms of economic and social inequality are as important threats to both real freedom and economic well-being that the welfare state cannot handle. The Social Trust Fund overcomes the disincentive problems of the welfare state by turning savings into a device to promote income redistribution in the long term, thereby marrying social justice and economic efficiency.
