by Guest Contributor | Oct 17, 2016 | Opinion
By Jennifer Lawson
Per capita payments, or ‘per caps’, as they are known in Indian Country, function as a kind of basic income for tribal nations that have them. In this piece, I want to examine the distinct difference between the thinking about such a basic income in Indian Country and the United States in general.
The other day, I was talking to a small group of non-native Americans about basic income. One of them said to me, “Basic income seems like something like that would take a long time to gain ground.”
In the United States in general, the thinking about basic income is not as far along as it is in Indian Country, where per caps have been a staple for many tribes for several years.
One of the first questions, for tribes that gained discretionary income in the last decade, has been, “What do we do with this money?”
Many tribal nations have tribally owned businesses and, unlike the general thinking in the United States, no one worries that this may be a form of communism or socialism. It is simply, for many tribal nations, in keeping with their tribal values to have a collectively owned business.
The revenue from such businesses, as well as the revenue from natural resources and other ways tribes gain money, provide the discretionary income that tribal nations work with.
The answer to the question, “What do we do with this money?” is answered differently by different tribal nations. Some provide services to their citizens, such as childcare, early childhood education, hospitals, and so forth. Others provide per caps to their members.
I do not want anyone to come away thinking that tribal nations are flushed with cash or that Native people are, in general, rich from per caps. Rather, I want to look at the differences between the tribal way of thinking and the United States’ way of thinking
From the tribal point of view, when you have a collectively owned business, it makes sense that one option would be to divide the revenue up and disperse it among citizens of the tribe. In general, what to do with the money is voted upon and the decision about what to do with the money is decided that way.
For non-native people, we do not have collectively owned businesses to decide how to divide the revenue. A large portion of people in the United States would rebuke such a business as socialism or communism.
However, we do have other ways of gaining access to a basic income without having collectively owned businesses. Some have suggested taxing pollution, for example.
For tribal nations, some of the arguments that are familiar to people in basic income have been espoused, both for and against. One worry, for example, is that people will not attend college because the thinking What’s the use? is in effect. That is, if you don’t need to attend college for future employment, why go? This thinking saddens many tribal people, who have a pre-colonial history of being interested in education, contrary to stereotypes.
But the biggest issue for tribes, which has become a real problem, is that of disenrollment. Disenrollment is, in effect, making people ineligible to be tribal citizens. While many tribal nations are growing as of late, some tribal nations with per caps have closed and/or tightened up their citizenship requirements to make per caps go further, and to allow each individual to have as much money from per caps as possible. If a tribal nation is doing pretty well economically, it does even better when the tribe is small.
With the large population of the United States, as well as our open citizenship requirements, where people may become citizens after completing various acts and learning about our government and founding documents, what we can afford to give our citizens depends on how we collect that money.
Because the issue of having collectively owned businesses seems to be less compatible with the values of the United States than of tribal nations, we of the United States have to be creative in how we decide to fund a basic income.
No matter the problems that tribal nations have experienced due to per caps, what is clear is that tribes that have the ability, and vote accordingly, can provide a basic income for their citizens. This should make us wonder why the United States, which has more wealth, opportunity, and so forth, cannot.
Looking over the state of per caps in Indian Country has made me, at least, realize that it can be done, and that we should do it. After all, if we had a basic income, I might be able to be in Standing Rock right now, standing with my Native brothers and sisters against the Dakota Access Pipeline—or engaging in other activist or cultural activities.
There is much that Indian Country can teach us. The issue of basic income is one we should look into further.
by Roland Duchatelet | Sep 30, 2016 | Opinion
During the 20th century, the increase in purchasing power of the workers in Western Europe was negotiated by the labour unions and paid for by the spectacular increase in productivity of agriculture and industry: we made more and better products with less workers. This yielded generous increases of net salaries and on top of that it allowed governments to pay for schools and health care. This resulted in the general belief that the wealth of a nation is the result of labour, because it paid not only for salaries, but also for social security and other government spending. Since then, the world elite believes that labour participation is the basis of our social security system and our wealth.
There are a few problems with this belief, however.
The first problem is that with the collapse of communism in 1989, the size of the economy grew from 1 billion participants (Europe, the US, Japan and a few small countries) to 6 billion. Cheap labour supply became abundant while the world wide bargaining power of labour unions became irrelevant. Many manufacturing companies moved their production to low cost countries. The “low cost” of these countries was mainly due to the insignificant tax on labour there, compared to Western Europe, where the labour tax was between 100 and 200% of the (higher) net salaries. The saving of the high labour tax was a major cost reduction driver for companies which moved their production, much more than the net salaries of the highly qualified, well trained, loyal, productive local workers which lost their jobs. Political Europe was sleeping apparently, not realising that the corresponding financing of the social security was moving away with the factories.
The second problem is that increasingly machines, robots and computers used in production of goods and services decrease the need for human workers.
The third problem is that social security contributions from the rapidly increasing public and subsidised employment are not real, because the wallet which collects them is the same wallet which pays them: the state.
The fourth problem is that life expectancy is growing, affecting the cost for the state paid pensions. Since health care cost is much higher in old age, the cost of state paid health care increases as well.
The fifth problem is that income from savings is trending toward zero. Citizens owning property are mostly excluded from social aid provided by the state, since they are supposed to derive an income from their property. This induces a new type of poverty. Moreover, the decrease in income from capital affects overall consumer spending, also within the working class.
As a consequence, the purchasing power of the working class has stalled in Western Europe and the US since 2000. This is hidden in the national accounts because in those figures the “income” which households derive from labour is the “gross” income including social security contributions and income taxes. The latter have risen.
Some political parties start to plead the reduction of social security benefits, which would be the start of a negative spiral.
The labour tax based system is structurally unstable. When sales decrease due to economic slowdown and workers are laid off, their income decreases so they buy less leading to further sales decreases and job losses in other businesses. The “Labour Church” will tell you that the central bank then should decrease the interest rate to stimulate investment and spending. This is speculative and slow to start effect. In any case, the interest rate is now zero and hence cannot be reduced anymore. The “Labour Church” system is in deep trouble. They seem to hope for a miracle: I see no “Plan”.
There is however one stabilising factor, our social security, which makes people continue to spend money when they have no work. This hints to the fact that “Purchasing Power” could be the solution to our stalled economic system. When the economy weakens, we should inject additional purchasing power into the economy. When the economy gets overheated, we could reduce the purchasing power injection.
Purchasing Power injection, Basic Income, should replace “labour” as the motor and regulator of our economic system. The distributed purchasing power generates spending, entrepreneurship and work for those who want to earn more money. Tax on labour can only be an auxiliary source of funding if we want such a system to be stable.
Basic Income supporters are a minority still. But we have a Plan.
by Josh Martin | Jan 19, 2016 | News
Tom Ashbrook’s radio show On Point at WBUR Radio in Boston held an hour-long discussion on basic income on January 14, 2016. Ashbrook invited four guests onto his show to discuss some of the key topics for discussion in the basic income debate, including technological unemployment, income inequality, work disincentives, and previous pilot projects. His guests were Karl Widerquist, co-chair of the Basic Income Earth Network; Megan McArdle, a columnist at Bloomberg View; Veronique de Rugy, a senior research fellow at the Mercatus Center at George Mason University; and Albert Wenger, a managing partner at Union Square Ventures. While three of the guests support the idea of a basic income—McArdle does not—the callers into the show varied in their reactions to the idea, with one caller imagining a basic income would help her go back to school and another caller asking how it is any different from communism.
To listen to the full episode, click here.
by Timothy Roscoe Carter | Sep 22, 2015 | Opinion
[The following is an excerpt from a book in progress, The Poverty Abolitionist’s Handbook.]
Q: But who will clean the toilets? If everyone has an income sufficient to meet their basic needs, even if the vast majority of people want to do some productive work, what incentive will there be for anyone to do all the dirty and dangerous jobs that need to be done for society to function?
A: That is an evil and aristocratic question. How will we find cheap labor to do the nasty jobs we want done, but don’t want to do ourselves, if we don’t starve some unimportant people who refuse to do them for us? This question is the labor equivalent of the question a Democratic California State Senator in the 1970s asked a group of feminists who were petitioning for the removal of the marital rape exemption: “But if you can’t rape your wife, who can you rape?” Or the plantation owners at the end of the Civil War who demanded to know who was going to pick their cotton.
You want to know where the incentive to do dirty jobs will come from? How about the free market? If you offered enough money you could probably get Warren Buffet to clean your toilet. You want your toilet cleaned? You do not want to do it yourself? Then just pay someone else who is not afraid of starving whatever it will cause them to clean it for you. You don’t have enough money? So sad. You probably do not have enough money to buy your own private jet, do you? That’s life. Though, you can look at the private jet rental cost instead in the meantime, so it isn’t all bad, right?
Note: This answer is a rant, but the question deserves it. Admittedly the *questioner* probably does not deserve the rant. There was a time only a half-century ago when the idea of prosecuting a man for raping his own wife seemed absurd. It seemed absurd to a man raised to believe it was his wife’s duty to cook, clean, and to give sex to her husband, and he did not think about the unfairness to the wife any more than most of us think about the unfairness to the chickens we eat. If you had a visceral defensive reaction to the idea that there is something unfair about eating chickens, then you can at least have some sympathy for the man who thinks it is his right to rape his wife. If you object that there is a huge degree of difference between the unfairness of eating chickens and the unfairness of raping wives, well, I would agree with you. (Full disclosure: I eat chickens.) Of course, the person who wants to force others to clean his toilet cheaply or starve would also see a huge difference between that and rape. And note that prosecuting men for raping their wives also seemed absurd to a lot of women who believed they were being good wives by submitting to their husbands, and saw – probably unconsciously – removal of the marital rape exemption as an attack on an identity that they based their self-worth on. And many people asking who will clean the toilets will actually be people who have themselves worked demeaning jobs at exploitative wages to provide food for their families and take pride that they did what they had to do to survive. Such people may see a basic income as an attack on their self-worth and personal identity in a manner similar to the good wife who finds it absurd to prosecute a man for “raping” his wife. So calling out such questions as evil probably does real harm to people who do not really deserve it. But to treat such questions as reasonable does the harm of conveying the idea that they are in fact reasonable questions. The only way to teach the wider public, and most importantly rising generations, that it is contemptible to ask who will pick your cotton if not slaves, or who a man can rape if not his wife, or who will clean the toilets if not people who would otherwise starve, is to treat the question with the contempt it deserves. If you absolutely must answer the “But who will clean the toilets?” question in a diplomatic way, you can substitute the answer to the next question about the effect of a basic income on wages. I still do not recommend it, because I believe it to be more important to call out the assumption that it is acceptable to force some people to do dirty jobs for others cheaply under threat of starvation.
Q: What would be the effect of a basic income on wages?
A: Overall there would likely be a moderate upward pressure on wages and possibly a slight leveling effect. The “permanent strike fund” aspect of a basic income would give most workers more bargaining power and cause wages in general to rise modestly. The wages of workers doing unpleasant and unskilled work would likely rise dramatically as no one will be forced into doing those jobs. The wages of skilled professionals such as doctors, accountants, plumbers, and electricians would likely fall as more people could take the time necessary to qualify for those positions. If the basic income was at a level sufficient to abolish poverty, the wages for pleasant unskilled work might fall, as it might be reasonable to rethink the need for a minimum wage. The leveling effect of a basic income is unlikely to reach a point where it will make financial sense for a law firm to require attorneys to take turns cleaning the office bathrooms, because then fewer people would likely become attorneys. But if it does, so be it. This makes it even more difficult when looking towards retirement, with many looking to work straight into retirement to help themselves financially. Others find that they are looking towards their equity for any help with retirement finances with some using something like this equity release calculator to find out how much they have and will be able to live on during their retirement.
Q: How will a basic income affect economic growth?
A: There will likely be overall positive economic growth resulting from a basic income, as it would end up as a net transfer of money from people who either hoard or invest most of their wealth to people who spend most of their wealth. Hoarding wealth is always bad for the economy, while investing wealth is a gamble that could grow the economy if there is demand for the investment, or squander wealth if there is not. If people have a guaranteed monthly income then they will be more likely to invest in local businesses, look at motley fool reviews and invest in the market, and put the money back into the economy. Spending money manifests demand, and so always helps the economy. Of course, the basic income does have to paid for, and so the economic effects of whatever tax scheme is proposed to pay for must be taken into account. Taxes on both income and consumption discourage economic activity and could counter the increased demand generated by the basic income. However, taxes on land, natural resources, and wealth capture rent, discourage hoarding, and encourage economic activity by forcing those who hold wealth to either use it or lose it.
Note: Philippe Van Parijs, one of the top living figures in the basic income movement, says that when we are asked this question, we should not answer it. There has been no way to empirically test the general question, there have been apparently contradictory results from empirical studies of the effects of a basic income on labor force participation, and economic growth is not the main point of a basic income. Even if it were good for overall economic growth to force 5% of the population to starve, this is not a world we want to live in. However, I believe that reasonable speculation can provide us with a plausible, positive, and useful answer, so I have provided one. But remember, you take my advice over his at your own risk.
Q: Isn’t the claim of technological unemployment just the Ludite fallacy?
A: Well, it is until it isn’t. It is not hard to imagine a society where the vast majority of jobs can be done more efficiently by machines, and the the few jobs that require humans are made so efficient by machines that only a minutely small number of humans are needed to do them. Eventually, this seems inevitable. The only question is whether it will come 20 years from now or 200 years from now. Evidence that it is coming sooner rather than later can be seen in the breakdown of the arguments against technological unemployment. Traditionally, economists have said technology creates more jobs than it eliminates via two primary mechanisms. First, jobs move from one sector to another. Second, higher skilled jobs are created to oversee the machines. So, a thousand years ago, most people worked in agriculture growing food. As technology made it possible for a few people to produce enough food for the many, people moved to factories. By 150 years ago, most people were working in manufacturing making goods. As manufacturing became more efficient, people moved into the service industry. But now, we are running out of sectors. And the jobs currently being threatened by technology include not just low-end work like cashiers and laborers, but highly educated work like accountants and pilots. The rate at which technology eliminates jobs may have already surpassed the rate at which it creates jobs.
Q: Are there other ways to deal with technological unemployment besides a basic income?
A: Yes. There are six.
1. We could allow massive numbers of people to starve.
2. We could guarantee jobs that do nothing useful for society and just waste the time of the employee, such as digging holes and filling them back up again.
3. We could institute a 15-hour work week and a $25-per-hour minimum wage.
4. We could start banning new technologies.
5. We could force everyone to become a cyborg. If you can’t beat ’em, join ’em.
6. We could give everyone computers and robots to rent out, making everyone a capitalist. Of course, their machines would need to be constantly upgraded to prevent obsolescence, some people would make bad choices, and some people would have their business go under through no fault of their own. Which means we would then need to accept mass starvation or strictly regulate how people run their robot rental rental businesses or give people new machines on a regular, periodic schedule.
Or we could just give everyone a basic income.
Q: Isn’t this just communism?
A: Actually, Milton Friedman and F.A. Hayek, two of the three most important libertarian economists in history, supported a basic income. Meanwhile, the most famous person to declare that those who don’t work don’t eat was Vladimir Lenin. So in this discussion, I am the one supporting the policies of Milton Friedman, and you are the one supporting the policies of Vladimir Lenin. But please, go back to calling me a communist.
Note: This answer is snark, but the question is not serious. The serious answer is that forms of a basic income guarantee are compatible with both capitalism and socialism/communism, and that fact helps to demonstrate that “capitalism ” and “socialism” are both incoherent terms. But over usually when you hear this question, it is not a serious inquiry but an ad hominin attack. The point of the answer is simply to injure the attacker’s credibility with onlookers by demonstrating that they simply do not know what they are talking about. Bonus points if they have to ask you who Hayek, Friedman, or Lenin is.
Q: Why should working middle class people support a basic income?
A: The first reason is money. Due to extreme rates of income and especially wealth inequality that exist today, under nearly all proposed tax schemes to pay for a basic income, the vast majority of working middle class people will be net beneficiaries. But even if you are near the break even point in the upper middle class, you should support a basic income for the same reason that healthy people should support universal health insurance: You are not invulnerable. You could lose your income and all the wealth you have spent years building up through your own bad decisions, the bad decisions of the C.E.O. of the company you work for, the bad decisions of a politician, a natural disaster, an economic recession, or getting hit by truck and left with back pain that leaves you in bed five hours a day but is invisible to a disability judge. And even if disaster never strikes you, the knowledge that it could strike you constrains your freedom. When you plan for the care of an aging parent, you know how precarious your finances are. When you dream of starting your own business, you know how precarious your finances are. When you consider taking time off for a vacation or to go back to school or to finish an art project, you know how precarious your finances are. When you ask your boss for a raise, *he* knows how precarious your finances are. Now imagine making all of those choices if you knew you had a basic income.
by Karl Widerquist | Jun 28, 2014 | Research
Dollar handcuffs (the Real Movement)
SUMMARY: This article is a communist criticism of basic income, concluding, “Basic income will be designed and implemented by the other class — your enemy — to meet its interests, not yours.”
Jehu “Basic Income: Which class will be writing the legislation?” The Real Movement: Communism is free time and nothing else, May 19, 2014
