by Andre Coelho | Mar 24, 2016 | News
Basavilvaso and Tagliaferro. Credit to: La Politica Online.
The Administración Nacional de la Seguridad Social (National Social Security Administration) in Argentina, or ANSES, is working on the universalization of the citizen’s income, which is being considered for pensioners and children. ANSES Executive Director Emilio Basavilbaso has himself stated that (the universalization of) a basic income can allow the country “not only to maintain, but to reinforce social rights”. At the moment, as Emilio Basavilbaso also agrees, a law must be passed in order to start money transfers under this partial basic income for pensioners.
The present government, led by president Mauricio Macri, is also considering a universal child payment (Asignación Universal por Hijo (AUH)), which has been proposed by parliament members Elisa Carrió and Elisa Carca as far back as 1997. The Argentinian government seems to be pursuing the expansion of unconditional payments per population sectors, at the moment focused on elder and younger citizens, through the internal transformation and increased capacity of the existent social security system.
More information at:
Language: Spanish
“Basavilbaso confirm que las jubilaciones aumentarán cerca de 15 por ciento [Basavilbaso has confirmed that pensions have risen 15 percent]”, La Política Online Economia, January 19th 2016
Financial Red Argentina, “ANSES Ingreso Ciudadano para la vejez [ANSES elderly basic income]”, 2nd December 2015
Financial Red Argentina, “Calendario de pago Ingreso Ciudadano Universal Marzo 2016 [Basic Income transfer calendar March 2016]”, March 1st 2016
Financial Red Argentina, “ANSES Elderly basic income: to retire without contributions [ANSES jubilacion universal: jubilarse sin aportes]”, March 1st 2016
by Andre Coelho | Mar 17, 2016 | Opinion
Informal settlement in Soweto. Credit to: The Conversation
The hypothesis: basic income has not been deployed in South Africa in part because the powers that be do not let go of their interest and ability to explore people.
The following article attempts to demonstrate the validity of this hypothesis.
Let’s begin with some background. Basic Income (BI) is not a new idea in South Africa. In fact a thorough economic analysis for BI implementation has existed since 2004. The analysis was drawn from the work of recognized economists, specialists in the field, and the findings were summarized in what became known as the Taylor Committee. The Basic Income Coalition (composed of Black Sash, COSATU and SAAC), used these results to prove that BI is feasible, or at least should be tested, in South Africa.
More than 10 years have passed, and yet nothing resembling BI has been implemented or even tested in South Africa. Why not?
It is not due to lack of need: 54%1 of South Africans – over 29 million people – live under the country’s poverty line, and over 40% of the labor force is unemployed2. Moreover, according to the BIG Financing Reference Group report, it is also not due to a lack of funds:
“The Basic Income Grant is an affordable option for South Africa. Although the four economists [Economic Policy Research Institute (EPRI), Prof. Pieter le Roux, Prof. Charles Meth and Dr. Ingrid Woolard] posit slightly different net costs for the BIG, representing transfers to the poor of different amounts, there was consensus that the grant is affordable without necessitating increased deficit spending be government.”
In spite of this, the same report also states that government officials believe that BI cannot combat poverty. They have refused to consider a BI, despite knowing that current social assistance plans fail to reach over 50% of those living under the poverty line, or nearly 15 million people. These officials have continued to say that BI would not be effective despite demonstration by the Taylor Committee that basic income is the best way to diminish or even eradicate poverty in the shortest amount of time. They also ignore fiscal collection and social security savings when speaking of BI, which more than doubles its actual net cost of about 24 million ZAR/year (1.35 billion €/year), according to the calculations of the Taylor Committee. In short, most government officials completely ignore these very consistent and thought-out analyses from the Taylor Committee. Why is that?
Well, the answer may lie in the kind of structure of South African economy. The private sector accounts for around 80% of the country’s economy3. The median income is 3036 ZAR/month (171 €/month)4, which is low compared to European standards. Taking the United Kingdom as reference, the following table can be set up (Table 1).
Table 1 – Income relationships, South Africa / UK
The relationship between the median income and the average living income is considerably higher in the UK than it is in South Africa. Moreover, the ratio of median income to statutory minimum income is also much higher in the UK. Indeed, while the median income in the UK is above the minimum income (as it should be), this is not the case in South Africa: more than half of South Africans have wages below the statutory minimum income. Finally, as we can see on the graph below, the spread of incomes in South Africa is clearly skewed to the lower end on the income axis, while incomes in the UK are much more evenly distributed around the center (Figure 1 and Figure 2).
Figure 1 – Income spread in South Africa4
Figure 2 – Income spread in the UK5
These data show that the South African economy is impoverished compared to a country like the UK, and that most economic activity depends on a low-wage, low-skilled work force6. This situation is best maintained when a large number of poor, dependent people are craving for jobs in the economy. Given their subservient position, these millions of people will naturally accept low wages and substandard working conditions that they might not otherwise accept. They are also kept away from most schooling and higher education, which could provide them with extra skills and allow them to apply to other jobs or start their own businesses. This is convenient for large corporations, and these corporations lobby and finance politicians and governments to protect their interests by providing them with access to cheap labor and lax environmental laws. The Transatlantic Trade and Investment Partnership (TTIP) deals, for example, are just a formally imposed recognition of the attitudes of domination that large corporations foist upon governments and the people at large.
There is a link between corporate interests and government policy. Furthermore, the implementation of a basic income would basically be contrary to corporate interests: BI would lift millions of people out of poverty, empower them to refuse conditions of exploitation and start their own business, invest in education and bettering their lives – depriving the corporations of their pool of cheap labor. Government policymakers may also respond out of ideology or prejudice, but corporate political sponsoring response must not be ruled out, given the entrenchment and longevity of their denial (relative to progressive policies like basic income).
More information at:
A. BIG Financing Reference Group, 2004. ““Breaking the poverty trap”: Financing a basic income grant in South Africa.” Basic Income Grant (BIG) Financing Reference Group conference, Johannesburg, 24 November 2003. March, 2004.
Notes:
1 – World Development Indicators – Poverty headcount ratio at national poverty lines (% of population), 2010
2 – A more accurate, expanded definition of unemployment, including the so-called ‘discouraged jobseekers’, according to reference A.
3 – World Development Indicators – General government final consumption expenditure (% of GDP) = 20.3. Hence Non-government (private) final consumption expenditure (% of GDP) = 79.7
4 – From the spread of households within the income distribution in South Africa, 2008.
5 – From Measuring National Well-being – Personal Finance, 2012 (UK)
6 – Higher skilled professionals are usually paid on or above the median income, so a low income distribution as shown in Figure 1 must be related with a high proportion of low skilled workers.
by Andre Coelho | Feb 24, 2016 | News
Last week, an important conference was held in Lisbon focused on basic income (BI) and its implications. Although similar initiatives have occurred in Portugal in the past, this was the first conference of its scale; it brought together national and international speakers, received a large amount of media attention and was organized by multiple partnering organizations: Grupo de Estudos Políticos, the political party PAN (Pessoas, Animais e Natureza), Movimento Rendimento Básico Incondicional – Portugal, Grupo de Teoria Política – CEHUM, and IHC (Instituto de História Contemporânea). This initiative accompanies PAN’s intention to propose, in parliament, a countrywide BI feasibility study.
The conference spanned two days, the 15th and 16th of February, and drew an audience of around 100 people.
The first day’s session, held in a conference room at the parliament building, was chaired by PAN’s Jorge Silva and presented keynote speakers such as Amílcar Moreira, Jurgen De Wispelaere, Roberto Merrill, Sjir Hoeijmakers, Pedro Teixeira and Miguel Horta. It also included the presence of political party representatives Ivan Gonçalves (PS), Ricardo Moreira (Bloco de Esquerda) and Miguel Santos (PAN).
Jorge Silva. Credit to: Luís Gaspar
Roberto Merrill opened up the session, presenting a theoretical framework for basic income: pre-distribution (instead of redistribution). According to his research, social problems do not derive from the lack of jobs but from restrictions in access to resources. He also listed a range of authors and most prominent publications on the subject.
Jurgen De Wispelaere’s presentation focused on the Finnish BI experiment, which is planned to begin next year. This two-year experiment is aimed at assessing the ability of BI to eliminate the poverty trap and reduce complexity, bureaucracy and costs in social security. According to Jurgen, the fundamental reasons to experiment with BI are to demonstrate its potential, raise awareness and build a political coalition. Finland’s experiment will necessarily have shortcomings, such as its limited duration, sample size and resources, but it nevertheless can be used to study a wide array of effects, such as popular opinion and preferences and the impact of a BI on labor markets, social security and poverty.
The next speaker, Sjir Hoeijmakers, presented the municipal experiments in the Netherlands, which are expected to start by late 2016 or early 2017 and involve at least 90 municipalities. Although there are around 300 municipalities in the Netherlands, the 90 that have already agreed to participate in the study represent more than 50% of the country’s population; thus, there seems to be a strong public support for these initiatives. In his talk, Sjir described the main worries that prompted the experiments: technology replacing jobs, and the complexity, conditionality and lack of freedom under the traditional social security system.
Jurgen De Wispelaere. Credit to: Luís Gaspar.
Amílcar Moreira and Pedro Teixeira presented more cautious views regarding basic income, although both were generally supportive. Amílcar warned that Portuguese social politics have historically been very conservative and favorable to the establishment of conditions on social security. Pedro presented a model for financing a basic income of 200 €/month, which he considers politically easier to implement than higher-valued BI proposals. He warned, however, that there would be a need to finance a BI through taxes other than labor (e.g., taxes on property, natural resources and pollution), since labor taxes are already imposing too much stress on the middle class.
The last keynote speaker of the day, Miguel Horta, presented his BI study, according to which higher redistributions occur with higher income inequality. In his model, which is self-balanced and budget neutral, a 50% tax on labor income can finance a 435 €/month BI in Portugal, with 25% of it given to children up to 18 years old. The current labor tax would be replaced, and a few social security programs would be rendered irrelevant, which would leave the fund for a BI only 2200 M € short. Miguel reasoned that this relatively small amount could be obtained from savings in health, security, very high pensions (caps), tightened fiscal collection on high incomes and reduced costs associated with bureaucracy.
After the last keynote address, the audience had time to interact with the speakers, and the political party representatives presented their views on BI. Among the political party representative, Ricardo Moreira of the left-wing party Bloco de Esquerda was the only to clearly oppose BI. Ricardo views BI as a right-wing tool to wipe out the welfare state.
Miguel Horta. Credit to: Luís Gaspar.
On the second day of the conference discussion continued at the FCSH university campus, with authors André Barata and Renato Carmo presenting their arguments for BI. Renato suggested that an exclusively national attempt to implement BI is too difficult, however, and instead recommended an approach like that proposed by Van Parijs, who calls for an European dividend. José Neves also defended BI, while cautioning activists to avoid purely cost/benefit logic, as if BI were a simple matter of arithmetic. He also called for a wider trust network in society, which comes when one considers every member of society as potentially creative and productive. Mariana Duarte Silva, an arts and co-work manager in Lisboa, also presented her arguments for BI, focusing on its universal nature, although admitted that she learned of the concept only when she was invited to this conference. Another newcomer to the BI discussion was workers’ and women’s activist Lina Lopes, from the union UGT, who found the concept interesting and promising. Lina suggested that BI could start out as a distribution to caretakers (the majority of which are women).
José Augusto Oliveira, representing the workers union CGTP, presented an opposing view of BI. Like Ricardo Moreira, José Augusto adheres to a full-employment ideal and believes that BI would effectively subsidize sloth. António Dores used his speaking opportunity to challenge the way in which social NGOs are managed at present: hostage to conditional financing schemes, which end up wrapped in dubious financial practices if not blatant corruption. Dores also denounced the precarious work conditions within these NGOs, concluding that BI would revitalize NGOs and provide dignity to a host of volunteers who participate in these organizations.
João José Fernandes, CEO of the Portuguese NGO Oikos, delivered an interesting and timely presentation on food (in)security, the main reason the national health service in Portugal is presently under tremendous stress. It turns out, according to Fernandes, that food intake problems are correlated with unemployment, most notably with insufficient income. This trend is aggravated by low levels of education. Fernandes pointed out that, for an average Portuguese adult, the minimum income for maintaining a healthy diet is around 200 €/month. He argued that any BI proposal must take this into account, and that the amount of the basic income must be adequate to cover a healthy diet, in addition to other basic necessities.
Three final presentations were given by Glória Fonseca, from Movimento de Trabalhadores Cristãos (Christian Workers Movement), robotics specialist and BI activist Dario Figueira, and Jurgen De Wispelaere. Glória focused on the natural link between Christian values and BI. Dario reviewed BI pilot studies worldwide, presenting their main results. Finally, Jurgen spoke on political feasibility and challenges; he surveyed the political obstacles to BI implementation, and recommending caution and clear-sightedness at every step of the way.
Throughout the entire conference, the audience was very active in questioning the authors and speakers, generating a healthy and useful debate about many facets of BI. The event was closely covered by the media, who interviewed for SIC Notícias TV André Silva from PAN and some of the main speakers for publication in newspapers and magazines. (See the list of publications below.)
Conference room at Portuguese Parliament. Credit to: Luís Gaspar.
More information at:
Language: Portuguese
Sofia Rodrigues, “PAN vai propor estudo sobre atribuição do Rendimento Básico Incondicional [PAN is proposing a study on Basic Income]“, Público online, 15th February, 2016
Sábado Magazine, Entrevista a Jurgen De Wispelaere [Interview with Jurgen De Wispelaere], 18th February, 2016
Paulo Chitas, “Especialista defende que o rendimento básico não promove a inatividade [Specialist defends that the Basic Income does not promote inactivity]“, Visão Magazine online, 15th February, 2016
Maria João Lopes, “E se tivéssemos direito a um rendimento só por nascermos [What if we were entitled to an income just for being born?]“, Público online, 15th February, 2016 (interview with Jorge Silva)
Maria João Lopes, “Com um RBI, há mais liberdade para ter um trabalho, remunerado ou não [With a Basic Income there is greater freedom to work, getting paid or not]“, Público online, 15th February, 2016 (interview with Roberto Merrill)
Movimento Rendimento Básico – Portugal website.
Political party PAN – political priorities.
