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China must be ready for automation

by Tyler Prochazka | Feb 18, 2017 | Opinion

China’s spectacular growth in the past thirty years has begun to slow down in recent years. Emerging signs suggest that China is woefully unprepared for the fallout from exponentially rising automation of manufacturing jobs. While businesses are still going to sites like https://gembah.com/guides/manufacturing-in-china-like-a-pro/ to find the best way they can manufacture their products, the factories in China need to make sure they are prepared for the increased automation that will be coming to the manufacturing industry in the coming years.

The former Supreme Leader Deng Xiaoping of the People’s Republic of China (PRC) orchestrated the country’s economic miracle through a dramatic increase in exports to the rest of the world. For the next several decades, China reoriented the world economy, and many companies stationed their factories within China to take advantage of the cheap labor. Many of these factories might be making use of system integration software soon to increase the efficiency of their factories. I hear it reduces a lot of admin work and increases productivity. As wages rise and the population ages, the value of the original bargain is starting to erode.

In absolute terms, China is leading the world in the number of robots used for production. Over the next decade, China will start to catch up to other advanced economies in terms of per capita robots. By 2019, China may even nearly double its number of robots. At the same time, robots will complete increasingly complex tasks, threatening an even wider range of jobs for humans. Inevitably, this will cause many low-skilled workers in China (and around the world) to lose their jobs. And absent incredibly disruptive government intervention that would likely do more harm than good, these low-skilled jobs will never come back.

Young people in China are more educated than ever, and are increasingly less likely to want to pursue factory jobs anyway. Automation can help propel China toward a more innovative and service-based economy by freeing up labor for these higher value pursuits. In the meantime, though, college-educated Chinese are having difficulty finding jobs as China’s economy readjusts. Without a proper safety net in place, China risks facing social unrest as automation begins to accelerate.

As it stands, China’s main welfare program dibao is too bureaucratic and ineffective to handle the influx of unemployed individuals because of all of the conditions attached to the program. When addressing automation, China’s best solution may be to universalize the dibao to create a universal basic income. This would allow for a smooth transition away from China’s reliance on human-led manufacturing. The need for product inspection in China is highly important for manufacturers, as they must make sure everything is made to the highest specifications. Using a China inspection service can help prevent issues and malfunctioning products, hopefully, this form of checking is not looked over when the change to more automated manufacturing is completed. China acts as a pillar for world economic growth. The basic income would not only stave off the most destabilizing aspects of the coming automation revolution in China, but it is also crucial for the stability of the international economy.

UBI needs peers to control services of general interest (part one)

by Guest Contributor | Feb 11, 2017 | Opinion

Written by: Katarzyna Gajewska

The argument that the system of peer production on a wide scale requires securing stable income for peers from the state is promoted, among others, by Michel Bauwens. In this article, I will argue that the reverse is also true. In order to be sustained, unconditional basic income (UBI) needs to be accompanied by changes in the realm of general interest services. This applies particularly to the domain of services of general interest that participate in the subsistence. Money transfer needs to be accompanied by de-commodification of subsistence measures.

Although UBI certainly would contribute to bettering the situation of the poor, it does not challenge the capitalist power relations. The domain of work and production is only one of the opportunities for the capitalist class to exploit inequalities and accumulate wealth. Other sources of wealth extraction are property rights, real estates, rent, access to natural resources, urban infrastructure, land grabbing. Elsewhere, I elaborate how, despite introducing a UBI, capitalist class domination would continue in the domain of subsistence¹ and housing ² if other elements of the system were preserved.

Technological unemployment due to robotization of production is indicated as one of the reasons for a UBI. Robotization would cause centralization of power in the hands of machine owners and technological elites. Since labor used to exercise influence on their wages through the threat of withdrawing from production, under the condition of technological unemployment it would lose its leverage.³ Therefore, adjusting the basic income to the level that enables a decent living would be increasingly difficult. On the other hand, the capital owning the means of production in the domain of services of general interest such as water, food, electricity, health or housing can demand higher prices once having dominant position, and there may even be additional costs for things like commercial water treatment products for businesses after the initial price is paid. Therefore, neoliberal pressure for privatization of subsistence-related services and goods is particularly dangerous. As a result of privatization, citizens can increasingly less meaningfully participate in the governance of general interest services, being left with the relatively passive roles of voter and client.⁴ The UBI movement needs to take this into account in formulating proposals for UBI reform, namely advocating for more democratic control over the means of subsistence.

Subsistence services in citizens’ hands: some inspirations

Representative democracy alone does not seem to prevent that services of general interest are privatized. Specific citizen mobilization around this issue is required. Three types of strategies can be pursued to bring more control over essential services: re-municipalization, overtake by citizen cooperatives, and commoning. I will give more space to the latter one because the two former have been described in other publications.

Remunicipalization

There are different models that incorporate the democratic dimension in the provision of services of general interest. For example, in water supply services privatization turned out to be dissatisfying for the customers both in terms of quality and prices. The book “HERE TO STAY: WATER REMUNICIPALISATION AS A GLOBAL TREND”⁵ analyzes examples of how this trend has been reverted by re-municipalization initiatives. It illustrates how significantly the quality can improve and prices lowered with the involvement of public authorities.

However, involving citizens in the process of decision making does not guarantee their influence on the final output. Incumbents’ initiatives in the realm of political participation do not seem to alleviate the democratic deficit. Participatory elements within the new public management and neo-Weberian state models can be motivated by the instrumental aim of overcoming resistance.⁶ Participatory and deliberative procedures can be used as ‘public relations’ tools by political elites to give citizens the illusion of engagement,⁷ so-called ‘participatory window-dressing.’⁸

Cooperatives

Citizens can organize to buy the infrastructure related to subsistence needs. In a small German town, Schoenau,⁹activists bought out electricity infrastructure to convert it into a cooperative of which citizens can buy shares. As an act of protest against the nuclear power, they turned to solar energy. Similar attempts have been undertaken by activists in Berlin to prevent the renewal of a contract with a multinational company of Swedish origin. Certainly, in the case of services that are sold on the market, there is a danger of degeneration of cooperative ideals due to the market pressure, which is quite common among worker and consumer cooperatives. Still it may be a better option in comparison to an accumulation of power in capitalist enterprises.

Commoning

The precariat, in the face of unresponsive state institutions, prefers the self-organized provision of services in order to become autonomous of these institutions.¹⁰ Heynen¹¹ argues that the realm of social rights and the welfare state has diminished in recent decades in the US, so social movements have invented other forms of pursuing their struggles. Instead of trusting that delegation to the state will ensure the provision of public services and redistribution, activists create services themselves. For instance, Food Not Bombs produces and redistributes food. Furthermore, representatives of the recent generation of social movements believe that creating alternatives rather than reforming the system is a better way to bring about change, which reflects the mistrust of and awareness of the danger of cooptation by elitist politics and institutions.¹² Activists focus on the ‘here and now’, practicing alternative forms of production and organization parallel to the state-based and market-based ones as everyday ‘revolutions.’¹³ For example, the domain of food-producing resources, although now mostly privatized, can be organized in a different way. In ancient times and still nowadays there are various communal arrangements in some parts of the world.¹⁴

In articles on People’s Potato, I describe a worker cooperative that coordinates the preparation of partly dumpster-dived food with the help of volunteers. Financed by fee levies, the meals are distributed for free. This type of the organization of food provision can be defined as peer production, which means a voluntary, spontaneous, and inclusive work contribution to produce a good or service in common that serves a broader community. Peers produce use value that is accessible even to those that have not contributed to its production. Initiatives such as Food Not Bombs or Incredible Edible follow similar philosophy. In the article on technological unemployment and work, I describe further initiatives of self-organized services: retirees time bank in Germany and subsistence cooperative in Catalonia.¹⁵ One could expect to optimize the costs and use of resources by restructuring production into commons. Las Indias’ Manifesto demonstrates potential gains that can be achieved by escaping the capitalist organization of production. Kibbutz movement managed to increase productivity and reduce the use of water in agriculture.¹⁶

Basic Income movement for other causes

“All we can ask of politics is to create the spaces in which the alternative social practices can develop.”¹⁷

Joining other movements in demanding the democratization of services, UBI movement could focus on a twofold struggle: mobilization against the privatization of services and for the re-appropriation of spaces for citizen participation and self-organization.

Elinor Ostrom argued in favor of creating institutional arrangements ‘for cooperative housing and neighborhood governance (…) to facilitate co-productive efforts for monitoring and exercising control over public spaces.’¹⁸Kooiman presents a model of ‘societal governance,’ a mix of self-governance, co-governance, and hierarchical governance.¹⁹

Bovaird predicts that the governance system may evolve into ‘self-organizing policy and service delivery systems – ‘governance without government.”²⁰ The progressive theories of public administration have a vision of public administration that is ‘collaborative, facilitative, or transformational social role in support of citizen emancipation and self-governance.’ This type of re-conceptualization of the role of public administration has a longer tradition in the feminist movement and in the 2000s several authors have postulated this direction of change.²¹ In an academic article, I propose a change to the tax system. Taxpayers could allocate certain part of the due taxes to the organizations of their choice. In this way, the organizations can plan their yearly budget and produce as much as the collected sum allows.²²Also laws facilitating the access to unused spaces would make it easier for the self-organizing groups to start commons projects.

The example of People’s Potato, which struggles against corporate monopoly in food provision at Concordia University in Montreal, illustrates that the mobilization although it requires true determination, can begin now, case by case. I summarized the relations between People’s Potato, commercial food providers, and the university administration in another article:

“People’s Potato discovered that part of kitchen space previously used by Sodexho/Marriot was vacant, while the major part was overtaken by Chartwells. They started to use this space for their cooking. For another two years, People’s Potato struggled with the administration to get official use of the space. It is equipped with all necessary industrial kitchen facilities. The university charges the Potato for some repairs, like painting or heavy maintenance, but they pay all of their other utilities, such as garbage removal, electricity and hot water. The status of the collective within the university structure is ambiguous and there is always a fear of losing support from other organizations and the kitchen space as no official contract has been signed. “²³

Instead of waiting for a more serious debate on UBI among political elites where activists could present a more encompassing reform, the change can arise from single initiatives. Späth and Rohracher point to the power of local experiments, which can mobilize actors. Niches, spaces protected from economic pressures can develop into full-fledged models for change. The local level change is possible in ‘off the radar’ spaces for interests of dominant economic actors. In this way, it is easier to overcome the problem of nested interests preventing change. Furthermore, institutional voids can enable introducing new practices.²⁴

About the author: Katarzyna Gajewska is an independent writer. She has a PhD in Political Science and has published on alternative economy and innovating the work organization since 2013. You can find her non-academic writing on such platforms as Occupy.com, P2P Foundation Blog, Basic Income UK, Bronislaw Magazine and LeftEast. For updates on her publications, you can check her Facebook page or send her an e-mail: k.gajewska_comm@zoho.com. If you would like to support her independent writing, please make a donation to the PayPal account at the same address!

References:

1Gajewska, Katarzyna (2014): Technological Unemployment but Still a Lot of Work: Towards Prosumerist Services of General Interest. Journal of Evolution and Technology 24(1): 104-112.

2Gajewska, Katarzyna (May 2014) : UBI and Housing Problem, https://basicincome.org.uk/2014/05/housing-power-land/

3Gajewska, Katarzyna (2014): Technological Unemployment but Still a Lot of Work: Towards Prosumerist Services of General Interest. Journal of Evolution and Technology 24(1): 104-112.

4 Elinor Ostrom, “A Communitarian Approach to Local Governance,” National Civic Review (Summer 1993): 226-233.

5HERE TO STAY: WATER REMUNICIPALISATION AS A GLOBAL TREND :https://www.tni.org/files/download/heretostay-en.pdf

6 William N. Dunn and David Y. Miller, “A Critique of the New Public Management and the Neo-Weberian State: Advancing a Critical Theory of Administrative Reform,” Public Organization Review 7 (December 2007) 345-358, 355.

7 Léon Blondiaux, “L’idée de démocratie participative: enjeux, impensés et questions récurrentes,” In M.-H. Bacqué et al. (eds), Gestion de proximité et démocratie participative. (Paris: La découverte, 2005). Léon Blondiaux and Yves Sintomer, “L’impératif délibératif,” Politix 15.57 (2002): 17–35.

8 Archon Fung and Erik Olin Wright, “Countervailing Power in Empowered Participatory Governance,” in Deepening Democracy (London/New York: Verso, 2003), 265.

9Elektrizitätswerke Schönau Netze, https://www.ews-schoenau.de/

10 Christophe Trombert, “Expertise professionnelle et contre-expertise militante dans l’accès aux droits sociaux: tension à front renversé autour du général et du singulier,” SociologieS, Théories et recherches, 25 June 2013. URL : https://sociologies.revues.org/4360

11 Nik Heynen, “Cooking Up Non-violent Civil-disobedient Direct Action for the Hungry: ‘Food Not Bombs’ and the Resurgence of Radical Democracy in the US,” Urban Studies 47(6 2010): 1225–1240.

12 cf. Day, “From Hegemony to Affinity.”

13 Marco Silvestro and Pascal Lebrun, “La révolution à l’échelle humaine, une radicalité actuelle concrète,” Argument 12 (Spring-Summer 2010).

14Vivero, Jose Luis (2015) : Transition Towards a Food Commons Regime: Re-Commoning Food to Crowd-Feed the World, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2548928

15Gajewska, Katarzyna (2014): Technological Unemployment but Still a Lot of Work: Towards Prosumerist Services of General Interest, Journal of Evolution and Technology 24(1): 104-112.https://jetpress.org/v24/gajewski.htm

16Las Indias’ Communard Manifesto, https://lasindias.com/the-communard-manifesto-html

17Gorz, A. (1999): Reclaiming Work: Beyond the Wage-based Society. Cambridge: Polity, p. 79.

18Ostrom, Elinor (1993): A Communitarian Approach to Local Governance, National Civic Review Summer, 226-233, 232.

19Kooiman, J. (2000): Societal Governance: Levels, Modes, and Orders of Social-political Governance. In Jon Pierre (ed.) Debating Governance: Authority, Steering and Democracy, (pp. 138–64). Oxford: Oxford University Press.

20Bovaird, Tony (2005): Public governance: balancing stakeholder power in a network society. International Review of Administrative Sciences, 71(2), 217–228, p. 226.

21Stout, Margaret (2010): Back to the Future: Toward a Political Economy of Love and Abundance, Administration & Society 42(1): 3–37.

22Gajewska, Katarzyna (2014): Peer production and prosummerism as a model for the future organization of general interest services provision in developed countries: examples of food services collectives. World Future Review 6(1): 29-39.

23Gajewska, Katarzyna (30 June 2014): There is such a thing as a free lunch: Montreal Students Commoning and Peering food services. P2P Foundation Blog, https://blog.p2pfoundation.net/there-is-such-a-thing-as-a-free-lunch-montreal-students-commoning-and-peering-food-services/2014/06/30

24P. Späth, H. Rohracher (2012): Local demonstrations for global transitions – Dynamics across governance levels fostering regime change. In: European Planning Studies 20(3), pp. 461-479.

Basic Income as All-inclusive Democratic Subsidy

by Jason Burke Murphy | Feb 3, 2017 | Opinion

Basic Income as All-inclusive Democratic Subsidy: Securing the Social Freedom and Economic Power for All People

Written by: Katja Kipping

[A long translator’s note: Katja Kipping is chair of the Left Party (Linkspartei) in Germany and a member of the national parliament. She has served as spokesperson for Germany’s Basic Income Network (Netzwerk Grundeinkommen). Within the Left Party, she organized the “Emancipatory Left” faction and writes for the libertarian socialist magazine “Prague Spring” (Prager Frühling).

Kipping presented this lecture “Grundeinkommen als Demokratiepauschale” at the Basic Income Earth Network Congress in Seoul, Korea, July 19th. She has frequently argued for basic income throughout Germany and has helped organize a “Basic Income faction” that includes most political parties in parliament.

I have translated this with the hope that left organizations worldwide will pay attention to her vision of basic income as a core component for the democratic left. Basic income would provide a clear sign that the left has learned from problems wrought in the past by bureaucracy, technocracy, and authoritarianism. Kipping draws from a constitutional republican tradition of investigating institutions that promote robust citizenship and deliberation. See Casassas and De Wispelaere 2012 and 2015. She also links her hopes with that of the degrowth movement. I see basic income, as Kipping presents it here, as an antidote to alienation and right-populism. Social analysis shows basic income to be part of the design of truly public institutions.

Any lapses in quality or argumentation should be attributed to me.

Please note that Kipping also presented in Dublin at the 12th Basic Income Earth Network Congress in 2008. “Moving to Basic Income (BI) – A left-wing political perspective” can be found at BIEN’s website.

You can a video of Kipping presenting the original German speech at https://bien2016.org/en/video-basic-income-and-politics-of-democracy/.

The text of her speech can be found at: https://www.katja-kipping.de/de/article/1112.grundeinkommen-als-demokratiepauschale.html. ]

Basic Income as All-inclusive Democratic Subsidy

Securing the Social Freedom and Economic Power for All People

Contents

Social Freedom and Democracy – radical democratic approaches to basic income.

Economic Might for All – basic Income and democratic institutions

Closing Remarks on social transformation

1. Social Freedom and Democracy – radical democratic approaches to basic income.

Radical democratic approaches to basic income pay close attention to the connections between people and to their mutual dependencies within a community. The community is here understood as something public and political. It is oriented towards the well-being of all and should be shaped by all. From this it follows that freedom should not be understood as a mere absence of intervention or interference. On the contrary, freedom should be understand as independence over against any arbitrary authority [Fremdherrschaft]. Freedom, in this sense, implies no arbitrary interventions or interference on the part of state institutions and also no possibility of such interventions and interference. Intervention is arbitrary if an intervention comes whenever the intervener wills it.

Freedom, on the other hand, is fulfilled primarily through self-governance. Self-governance is formed by social and individual organization and also by monitoring these potential interventions and the institutions capable of them. Individual freedom, viewed in such an intersubjective political context, is also social freedom. The highest value is active participation of all in the res publica – a collective deliberative democratic self-determination. This naturally implies social equality and the securing of social freedom, which implies preventing any economically grounded dominance and dependency. Laws and institutions also need to reflect, promote, and enable the common good and self-governance. (See Socialist Party South Korea 2009, Patry 2010, Cassasas/De Wispelaere 2012, Cassasas/De Wispelaere 2015).

The following six theses on the establishment of a basic income as an all-inclusive democratic subsidy can be derived from these basic principles of radical democracy and social freedom.

Basic Income must secure what a political community requires from each citizen in terms of money. This includes securing existence, social participation, and participation in political life. This unconditional guarantee of existence and participation has a monetary component. Non-monetary components also exist, such as free access to public goods, and to public infrastructure and services. These monetary and non-monetary components do not exclude each other but rather they complete one another. Both these monetary and non-monetary forms should, first, provide people socio-economic independence and, second, preserve their status as citizens with economic negotiating power whereby they can participate in the formation of society. Without the adequate safeguarding of free and equal conditions of social participation, no democratic participation is possible – formal possibilities for participation are not enough.

Whoever does not have enough material resources is first of all excluded from political participation and, secondly, doesn’t have enough negotiating power within political processes. This means that basic income, like all vital services, needs to be provided long-term. As I see it, this is not a problem in a time of high productivity and surplus. At most, it is a problem for those who do not want to give up economic privileges and political power. There is enough for all—worldwide!

From a radical-democratic perspective, the basic income on a regular basis is preferable to single disbursements, like with a stakeholder grant or starting capital. Only regular payments can guarantee a lifelong income and its corresponding participation.

The right to an unconditional basic income must be combined with a modern understanding of citizenship. A distinction between a majority of citizens and a minority of immigrants with regard to elementary socioeconomic rights and opportunities would lead to a problematic division of the community and a majority’s dominance over a minority.

From a radical democratic viewpoint, people receive the unconditional basic income as equal members of the political community, not as part of a needy group that depends on the state. Any particular stigmatization of population groups splits the community and is a source for domination. That would still be true with a partial basic income (or transfers that do not secure survival or make social participation possible) that is supplemented by need-tested, income-tested, or asset-tested social benefits in order to reach a sufficient level.

It is clear that a person, who must make him or herself a stigmatized petitioner at the social office has a significantly harder time taking an upright path towards the political formation of the community. As Zygmunt Bauman formulated it: “The decisive argument in favor of the basic income is that it is the conditio sine qua non of a republic, as it can only exist in the union of people with self-confidence, of people without existential anxiety. A basic income which actually secures existence and allows social participation would establish a principle of citizens’ rights, rights that are not subject to a divisive and disqualifying ‘access test’ by need tests.” (Bauman 1999). [Note: this is a translation of the Bauman quote as found in Kipping’s speech. –JBM]

Therefore 5 holds: All citizens only have their rights fully recognized reciprocally through a sufficient basic income. This also means that more affluent citizens are comparatively more likely to contribute to the financing of the basic income than the less well-off citizens. This poses the question of the redistribution of economic resources and economic power.

Basic income is not tied to any condition. An obligation towards any social or political participation would be sources of new domination. These would enable arbitrary interventions. The question of what makes something socially recognizable, and what does not, opens up a considerable amount of bureaucratic discretion. A citizen’s right to a basic income that included a direct citizen obligation would also transform voluntary engagement into regulated compulsory participation.

I would like to end this section with a quote from a German supporter of basic income who is also a politician. “It is farcical that MEPs [Members of the European Parliament] claim to maintain their substantial independence through relatively high salaries in order to make themselves non-extortionable but most of these deputies do not consider it necessary to ensure such independence and non-blackmail for the sovereign, the people” (Spehr 2003, 105). Basic income’s individual guarantee of a secure existence and participation is, alongside other forms of universal security for people (such as free access to public goods, social infrastructure, and social services), an indispensable prerequisite for social freedom, democratic and political engagement and the negotiating power for all people. It is an all-inclusive democratic subsidy!

2. Economic power for all – basic income and democratic institutions

Whoever says A must also say B. Who calls for basic income so that people can enter the public sphere with negotiating power must also call for the public shaping of our political foundations, economy, and everyday life (see Casassas and De Wispelaere 2012 and 2015). We need this to secure a basic income and other sorts of public services. Arbitrary interferences in human affairs through economic power, by endangering survival, health, and natural resources is not acceptable. An economy that is deprived of public organization, an economy that is privatized, is unacceptable. That also means that an economy and a financial sector that is immune to democratic control and influence is likewise unacceptable.

An imbalance in power through the deprivation of the public (privatization) in one form or another reaches deeply into real political and social power relations and removes the political and therefore citizens from the formation and control of public affairs. On the one hand, this includes power that arises from economic distribution—income, assets, and investment opportunities. This certainly also includes power in the realm of shaping and administering the economy and the financial sector. Who actually determines the use of natural resources, production resources, investment and the way in which economic activities are taxed? Who is exercising an alienated domination over the people today with real, unequally distributed, forms of design and control, and who subjects society and the economy to the will of a minority?

In addition to basic income and other forms of life and of participation for all people, social freedom requires the self-government of the citizens: by means of joint and individual control and appropriate intervention possibilities, which are secured by appropriately democratic institutions. These institutions must give all people the opportunity to shape social and economic life individually and collectively (see Cassasas / De Wispelaere 2015).

Economic power for all means basic income, including other unconditional support for existence. It also means the safeguarding of the economy and society for all and the institutionally secured public and political shaping of the economy and the society by all. This makes a democratic social transformation all the more necessary and urgent. Tomorrow, I am speaking at another conference about the challenge that this entails for the European left.

3. Concluding Remarks on Socio-Ecological Transformation

Poverty and exclusion, power over the many by the few, and destruction of the natural foundations of human life – that is the situation.

The international degrowth movement, which is committed to a world with significantly less natural resource consumption and to a rollback of ecological destruction and damage to our planet, therefore argues for the cohesion of ecology, democracy and social security of all people, and thus for the convergence of the various social movements and political actors (see Blaschke 2016).

It seems to me that only with this complex point of view and a committed relationship between social movements can the challenges of the 21st century be countered. Basic income, which in fact assures material existence and enables social participation, is an important component of a social-ecological transformation, which seeks to also be a democratic transformation!

Literature:

Bauman, Zygmunt (1999), In Search of Politics. Cambridge. Polity Press.

Blaschke, Ronald (2016), Grundeinkommen und Degrowth – Wie passt das zusammen? https://www.degrowth.de/de/2016/02/grundeinkommen-und-degrowth-wie-passt-das-zusammen/

Casassas, David / De Wispelaere, Jurgen (2012), The Alaska Model: A Republican Perspective. In: Karl Widerquist / Michael W. Howard (Ed.): Alaska’s Permanent Fund Dividend. Examining his Suitability as a Model, New York, 169-188.

Casassas, David / De Wispelaere, Jurgen (2015), Republicanism and the political economy of democracy. European Journal of Social Theory, September, 1-18.

Kipping, Katja (2009), Ausverkauf der Politik. Für einen demokratischen Aufbruch, Berlin.

Patry, Eric (2010), Das bedingungslose Grundeinkommen in der Schweiz. Eine republikanische Perspektive, Bern, Stuttgart, Wien.

Socialist Party South Korea, Unconditional Basic Income and General Social Care, Party Program, Supplement No. 1, 2009 (Translation of Socialist Party of South Korea, “Basic Income for All und Universal Welfare”, translation by Min Geum, https://www.grundeinkommen.de/ Content / uploads / 2010/08 / 10-05-22-bge-program-socialist-party-korea-endrb.pdf

Spehr, Christoph (2003), Gleicher als andere. Eine Grundlegung der freien Kooperation, in: Christoph Spehr (Hg.), Gleicher als andere. Eine Grundlegung der freien Kooperation, Berlin, S. 19-115.

Translated by Jason Burke Murphy, Elms College

Funding social security after automation

by Roland Duchatelet | Jan 18, 2017 | Opinion

Finding the money to pay for our social security is becoming more difficult, because paid work is being replaced by robots — the financial foundation of the social security system is crumbling. This is true whether we talk about financing basic income or any other social security system. Increasingly, automation is replacing “productive” jobs. There is still room to create jobs in basic services. However, such jobs do not create enough “added value” to “contribute” to the financing of our social security system. We are happy that these new jobs provide an income to those families. But it is too far stretched to believe that prices for such “proximity” services, helping each other, can be inflated by social security contributions.

Because the distribution of purchasing power is essential to fuel our economic system, time has come to search for other sources of funding, other than “social security contributions” from labour.

An obvious tax-free way to help fund social security is to reduce the cost of public administration and public services through productivity gains. Another tax-free way is to use the profits of state owned companies to fund social security. Many countries own companies, in full or in part, such as in transportation, mobility, housing, banks, car manufacturing, electricity, water distribution, telecommunication etc. Some of those companies do well, others do not. In most countries, the sum of the profits (and losses) derived from those state-owned companies is low in comparison to the cost of the social security system. Sovereign wealth funds are a special category of state owned companies. Their goal is to generate profit out of the collective savings by the country to cover future social security expenses, like retirement benefits, but also to conduct economic stimuli programs in periods of economic decline.

This induces a discussion regarding to which part of the social security should be funded by savings and which part should come from “redistribution” (sometimes referred to as “repartition”). There are both public and private schemes to fund retirement benefits out of savings. However, in most countries repartition funds the biggest part of the retirement budget. In most countries, the non-retirement social security benefits like child allowances, unemployment, illness, and health care are almost entirely funded by redistribution. It is largely recommended that no matter what state your country’s economy is in, you should always save money yourself for your retirement too. It is possible that you might become incapacitated and unable to decide how this money is handled due to old age, therefore electing someone to have power of attorney on your behalf is also a crucial part of planning for your future. You can learn more about power of attorney here.

Very little academic work has been done on the ideal mix of social security funding between savings or repartition. Imagine a social security system which would be completely funded by (public and private) savings. That would be a huge challenge for any economic system because the percentage of required savings in the real economy would be extremely high. Moreover, there would be huge asset inflation leading to high volatility in stock markets and perceived personal wealth, this in turn yielding high instability in spending in the real economy. The short answer therefore is that the part of savings in our social security system should be relatively low.

Some defend the idea of money creation to fund basic income. The problem with this proposal is that it supposes an expanding economy while the population in most European countries are starting to shrink.

What would happen if we dig a hole into the ground and we discover tonnes of gold, gold available in massive quantities, just like water? What would be its value? Except for a few industrial applications, gold is useless. The reason it is used in jewels is based on its scarcity rather than its beauty.

However, we found something more useful while digging: oil. It can be used to make plastics and all sorts of other useful materials. Moreover, it can be used to produce heat or electricity. In oil or gas-rich countries the oil industry is massively contributing to the state income: social security is funded, at least in part but often completely, by this “black gold.”

Astonishingly, so far, the benefits of the black gold bonanza were only moderately used in countries which do not have these natural resources. They could have levied far higher import or consumption taxes on oil products than they actually did.

Higher taxes on energy consumption is an obvious way to finance social security in 2017, rather than demanding low income workers to share a big part of their small income to fund their health care and future retirement. Such a tax would surely reduce energy consumption and lower CO2 emissions. What is wrong with that? Either way when it comes to finances and especially retirement in our day in age now, more people are in fear of their own instability, if you’re one of these people you should be looking at ways to increase your retirement pot.

Maybe there are other “good” taxes? In Macau, the gambling tax, which is mainly contributed by visitors, finances a yearly basic income for all inhabitants as well as a fair share of the health care system. While in Sweden, their gambling tax seems to be in order to regulate their gambling market, preventing it from spiraling. You can read more here – https://battrenyheter.se/artikel/spelskatten-taljer-guld-at-svensk-ekonomi/. Different countries require gamblers to file their winnings in different ways, so it’s important for people to check their country’s regulations on gambling income. For anyone who is interested in bringing in some gambling income, it might be worth looking for an online livemobile66 slot game. That will give users the option to play for money, allowing them to start bringing in some gambling money.

Any other taxes?

Taxes should fulfill 3 requirements:

They should be significant enough such that the cost of enforcing and collecting them is small compared to the revenues.
They should be socially desirable. For example, a tax on exchanging services with each other is undesirable. A tax on cigarettes is a very good tax, a tax on alcoholic beverages as well, just like a tax on electricity or oil products.
They should be difficult to avoid or defraud.

Why not a smart tax on robots? For example, a tax on products made by robots, while it doesn’t matter if those products are made in the country or elsewhere. However, even if a smart phone would cost twice the current price, we still would buy it, just like we would buy our PC or fridge at twice the price. The easy way to implement such a tax in practice is to increase the value added tax or the sales tax on such products. The goal is to replace the “social security contributions” on low wage labour, because tax on low paid jobs is a bad tax. The problem is that the political world is not aware of that yet.

The replacement of high added value jobs by robots undermines the current mechanism of redistribution of wealth, such that some political voices emerge which are pleading to reduce social security benefits. We need to find a better way to fund our social security. This is essential to win the battle for basic income.

FILM REVIEW: ‘In the Same Boat’

by Guest Contributor | Jan 11, 2017 | Opinion

On January 9th, Zygmund Bauman passed away at the age of 91. He is considered one of the great philosophers and sociologist of our time, who introduced the concept of “liquid modernity” to describe the postmodern age.

He is the main character in the recently released documentary “In the Same Boat” where he urges to tackle global problems on a global scale, and suggests exploring new roads such as a universal basic income.

Read more in this review: “Man vs machine, or man ahead with machine?”

MACHINE VS MAN, OR MAN AHEAD WITH MACHINE?

Written by: Bart Grugeon Plana

In the modern era, digital technology is substituting human brain power in a similar way as the steam engine did in the eighteenth century, making muscle power inefficient. Would it be possible, however, to harness this digital revolution for the benefit of humans and the planet, to share prosperity? The documentary “In the Same Boat,” which is being released in several countries throughout Europe, has opened up this interesting debate.

We are in the middle of a new industrial revolution and with the advance of Artificial Intelligence, this process is affecting an increasing number of sectors in the economy. Not only is traditional blue-collar work being carried out by machines, but also work that requires specifically human capabilities. In the coming years, for instance, the self-driving car will turn the transportation sector on its head.

This revolution in productivity can be seen as good news, since machines will do our traditional work and we can dedicate our time to education, care, hobbies and services. Also, new technologies and the availability of huge amounts of data allow us to optimise the planet’s scarce resources. However, there is no guarantee that the increase of wealth will be spread over the inhabitants of the planet with any criterion of equity. There is a real risk that the ownership of machines will be reduced to a small number of people and that the great majority of the world’s population will be left without the means to generate an income.

Most countries in the world have seen income inequality rise during the last decade, in part because of the technological revolution. Economic data (Link 1) show that since the year 2000, the western economy has invested more in technology and less in human capital. This strategy has endowed innovative entrepreneurs with more benefits, without creating more jobs or raising average incomes. The generated wealth went to a tiny minority. Wealth accumulation can come if you already have financial capital and know how to invest it, but if you depend on selling your skills in the labour market, it becomes more difficult to make a living.

When looking at the data of the concentration of wealth, there isn’t much margin for many interpretations. There are 62 people in the world that are as wealthy as the poorest half of the global population. In the US, the middle class is endangered; in the period of economic recovery between 2009 and 2013, the top one per cent of the population was assigned 25 times more of the national revenue than the rest (Link 2).

Many people feel that they are being excluded from the labour market, and they are aware that they have little chance to win the race against the machines. The solution is to learn to work ahead with technology and to think about a strategy to create wealth together, says Erik Brynjolfsson, an expert in information economy (Link 3).

“We are in full transformation towards the society of the 21th century, and the outcome is still open: either with shared prosperity, or, at the contrary, with more inequality. This decision depends on our individual choices and on our strategy as a society. The power is in our hands. Technology is merely an instrument,” Brynjolfsson said.

RECONCILIATION OF POWER AND POLITICS

Image still from ‘In the Same Boat’

The dominant political debate today doesn’t pay much attention to the digital revolution we are experiencing, and mainly focuses on creating favourable conditions to stimulate companies to create as many jobs as possible.

This way of thinking conforms to the paradigm of the second half of the 20th century, when we got used to the idea of ‘full employment’, explains sociologist Zygmund Bauman (Link 4). In our social consciousness, the normal situation is to be in employment and a person that is ‘un-employed’ does not fit this normality. However, in the new technological world, the techniques of the past don’t seem to work, and a solution for the structural problem of unemployment hasn’t yet been found. In Europe, 8.5 per cent of the active population has no job, with significant regional and age variation (Link 5). The situation in Greece and Spain is the most alarming.

According to Bauman (Link 6), we don’t know how to regain control over our economic system because it operates on a global scale: “With just one click on a computer, a company can decide to move 100.000 jobs from here to another part of the planet where labour conditions are more interesting,” he asserts, “Capital and finance move without restraints, but labour does not.”

Looking for solutions, citizens turn to the political class who ultimately can’t influence the economic decision-making process. “They have a local sphere of action, mainly at the level of the nation-state, but power is organised on a global scale and escapes from political control. This divorce between power and politics is the essence of the problem of our society in transformation”, says Bauman, who considers it is a task of all citizens to reconcile both (Link 7).

For the first time in human history, all inhabitants of the planet are interconnected and are interdependent. If we want to resist the populist and protectionist wave that is extending over the globe after Brexit and the election of Donald Trump, we must think about different ways to organise work and to distribute wealth. Several experts insist that we should radically rethink the foundations of our society and they propose an open dialogue to come to sensible solutions.

WE ARE ALL IN THE SAME BOAT

The documentary “In the Same Boat” made a momentous effort to open this debate and to project the voices that invoke a new paradigm. Zygmund Bauman, Serge Latouche, Tony Atkinson, Mariana Muzzucato, José Mujica and many others explain why the current labour model has hit a dead end. With a cinematographic style, spectacular photography and a varied musical palette, the film is fresh and inspiring, even whilst dealing with such a weighty subject as the future of humanity.

Zygmund Bauman considers the message of ‘In the Same Boat’ the complete antithesis of Margaret Thatcher’s famous slogan ‘TINA’; claiming that “There Is No Alternative” to the liberalisation of all parts of society as it is the only way to guarantee welfare. On the contrary, the polish sociologist proposes to “change the course of the boat that all inhabitants of the planet are in”. He believes that the new paradigm of the 21st century should cut the ties between income and work. “We should abandon the idea of working to make our living. We cannot condition the right to live to the interests of the company we work for,” he argues (Link 8).

The documentary proposes a universal basic income as one of the solutions to fair wealth redistribution. It is not considered a charity for the misfortunate, but rather a technological dividend of the past — a common right. Mariana Mazzucato (Link 7), an economist specialized in technological innovation, explains that “innovation largely depends on public financing and on a collective effort. Moreover, innovation today is a heritage of discoveries of the past.” In other words, what makes your smartphone smart (battery, GPS, Internet, mathematical algorithms, touch screen, etc.) are no individual or private inventions, but are the result of the effort of society as a whole with publicly-funded research programs. Why is it then that the benefits of this technological heritage go to just a privileged minority? How can it be justified that the cost and the risk of research is burdened by the public, but the rewards are privatised? If technology allows us to delegate work to machines due to the effort of many generations, wouldn’t the legitimate heir be society as a whole?

The film has arrived at the precise moment to put the current economical and institutional crisis into a wider perspective. Hopefully it can help to spark a global debate about the necessary societal changes.

“In the Same Boat” was released in Spain in November 2016 and will be screened in other countries during 2017. Members of the Basic Income Network that want to organise local screenings can contact the team on the Facebook page www.facebook.com/inthesameb.

Included is the trailer of the documentary and the presentation with Zygmund Bauman, talking about the future of work. Barcelona, February 2016.

About the author:
Bart Grugeon Plana works as an investigative journalist for the Barcelona based newspaper La Directa, and collaborates with other news platforms such as Apache.be and Ouishare Magazine. He has a special interest in common-based peer production, collaborative economy, platform cooperativism and energy transition.

Trailer In the Same Boat