Book Review by Dr. Jan Stroeken

Michael j. Sandel has written a book about the deep causes of the inequality that is a key driving force behind the populist backlash of recent years. His analysis serves as a basis for justification of the introduction of a universal basic income. For the complete review, see: https://basisinkomen.nl/wp-content/uploads/Book-Review-Michael-Sandel-Jan-Stroeken.pdf

And in Dutch:  https://basisinkomen.nl/boekbespreking-de-tirannie-van-verdienste-michael-j-sandel/

Here you will find a short summary, being the last part of the review:

Public Debate and Basic Income
Sandel’s analysis is razor sharp. What he brings to the fore more than anything is how present-day populism is only indirectly fuelled by the unequal distribution of income and essentially dominated by an ethical and cultural component. A growing section of the population feels underrated. This has everything to do with the tyranny of merit driven by the meritocratic ethos that, over the past decades, has led to meritocratic hubris. This hubris is reflected in the winners’ tendency to let their success go to their heads, forgetting about all the luck and good fortune that helped them along the way. Those who make it to the top believe with self-satisfied conviction that they deserve their fate and that those who end up at the bottom do too. This leaves little room for the kind of solidarity that could arise if we were to realise just how haphazardly talent is distributed and how randomly fate can either be kind or cruel. Merit-based pay is, according to Sandel, thus a form of tyranny – an oppressive regime.

And so, Sandel launches into a plea for a sweeping public debate on how to move from today’s individualisation to a greater sense of solidarity and more self-determination for all. What is essential in this respect is his conclusion that for many to be successful in life, all forms of education and work would have to be taken equally seriously. Without explicitly mentioning it, he points to the core of what the implementation of a universal basic income is all about: more equal recognition of current paid and unpaid work, as well as a stimulus to go to school. In an interview with Dutch newspaper De Volkskrant (20 September 2020), Sandel describes this when he speaks about ‘that which contributes to the community’ as a key alternative criterion to purely performance/merit-based recognition:

 ‘It is, in any case, a more democratic method that allows us to recognise contributions that are currently ignored or undervalued. I mean contributions such as the unpaid work that is done within households, for example, such as raising children and caring for relatives. Or all the work that, due to the COVID-19 crisis, has turned out to be much more important than society gave it credit for: nursing care, cleaning work, waste collection, and logistics. Setting aside the matter of usefulness, the fact that there is equal dignity in every human being should also reverberate in the dignity of everyone’s work.’

Regrettably, Sandel hardly gets around to formulating specific solutions in his book. Nevertheless, his most concrete suggestion with respect to the revaluation of work is to improve wages at the bottom of the labour market, such as through wage supplementation schemes and by shifting the tax burden away from labour and onto consumption, speculation, and capital. While the latter suggestion is an excellent one, it would be even better if it were substantiated further to ensure that those who do unpaid work also benefit. 

This further substantiation also takes us to a second key argument for downgrading the role of merit-based pay, which is that the link between current wages on the one hand and individual work performance on the other is loosening. Pay is increasingly less personal. Our current level of prosperity, as initially reflected in people’s primary income, is the result of many years of productivity growth to which many generations have contributed. Our high income levels can, therefore, not be put down only to the labour performed and capital invested in companies at this point in time. In this context, distributing primary income only to those directly involved in the production process seems to be increasingly less of a given and implementing a universal basic income for all is an obvious alternative, i.e. regardless of someone’s position in the productivity-driven labour process. The state collecting taxes directly at the source, i.e. at the level of companies’ production, would then be the obvious choice. This would also automatically shift the tax burden to sources other than labour, which is merely one production factor.

The figures provided in the book demonstrate that there is growing support among the general public for the idea of universal basic income. Even so, there is a hard core of people who are against it and keep using counter-arguments that they cannot back up with facts, such as a universal basic income having adverse effects on the labour market and being too costly. Their rejection might very well have little to do with those counter-arguments and rather be driven by a strong meritocratic bias. There is a clear relation between implementation of universal basic income and the public debate that Sandel wants to initiate.

Finally, the results of the most recent parliamentary elections in the Netherlands can be explained based on Sandel’s The Tyranny of Merit. On the one hand, right-wing populist parties are on the rise. One in five Dutch people voted for populist right-wing parties that have become increasingly extreme since the days of Pim Fortuyn’s first populist revolt in the early 2000s: full of mistrust and bitterness directed at everything and everyone and not shy about avowing discrimination. Even in the knowledge that these parties will not be part of a coalition government and play no role in the actual governance of the country, people still vote for them. And people vote for these parties even though their election programmes are, at least in a socioeconomic sense, more likely to be prejudiced than to favour them. On the other hand, the two winners of the elections are supreme exponents of meritocracy, namely the People’s Party for Freedom and Democracy (VVD, the party for the successful) and Democrats 66 (D66, the party for the highly educated). What we need to do over the coming years, therefore, is to assemble a left-wing populist programme that addresses three pressing issues:

  • How to achieve a sustainable world as soon as possible;
       
  • How to reach a post-capitalist state by shifting the balance of power;
       
  • How to accomplish lasting labour market change in line with the foregoing through a national debate as proposed by Sandel.

Some possible solutions include a large-scale shift from taxation of labour to direct taxation of companies’ production as well as implementation of universal basic income.

The Tyranny of Merit: What’s Become of the Common Good?‘ is available from Penguin Random House, published September 2020

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