by Florie Barnhoorn | Jul 30, 2016 | News
Highlights from the first half of 2016
The early days of 2016 brought a pleasant surprise for the Vereniging Basisinkomen (VBi; Association for a Basic Income), the Dutch branch of BIEN, which celebrated its 25 year anniversary in January. The political leader of the small Cultural Liberal Party, Norbert Klein, initiated a memorandum for the Members of The Tweede Kamer (Second Chamber) of Parliament. “The labour market is changed fundamentally. The introduction of new, innovative concepts like a basic income are urgently needed to prevent large scale social inequality, social unrest and to provide income protection,” he argued in his memo called Zeker Flexibel (Security and Flexibility). This was the first time since the 2000s that the highest political levels were challenged to discuss basic income.
However, the Minister for Social Affairs and Employment, Lodewijk Asscher (of the Partij van de Arbeid or Labour Party) said that although he recognizes the importance of a social and political debate on the future shape of social systems, I’m sure having some great lobbying tips would help in these efforts. He prefers to continue with the existing policy, because he cannot guarantee that areas such as healthcare and social participation would be secured after the introduction of a basic income.
According to Guy Standing at the opening of the 16th World Congress of BIEN, held in Seoul 7-9 July 2016, the best way to attract the attention of politicians is to highlight the growth of the precariat and the growth of related social unrest. The unconditional basic income (UBI) is the most practical, feasible and positively inspiring response to those problems for years to come.
A recent poll by Dalia Research found that 68% of people across all 28 EU member states said they would definitely or probably vote for a universal basic income proposal.
In recent years, the VBi too witnessed an increasing interest in the idea of a basic income, not only among the general public but also in the media. The association increased from a handful of older members in 1991 to a robust movement with more than 500 subscribers both young and elderly. This growing awareness has compelled the VBi to think about new strategies to spread the message: the implementation of an UBI in The Netherlands.
One of these strategies is the establishment of so-called ‘Basisteams’ (Basic teams), local groups who have the important task to inform people and to raise enthusiasm among the population for the advantages of a basic income. Full knowledge of the concept of a UBI is a prerequisite that must lead to political decision-making and acceptance.
Nowadays there are about ten active groups and eight more groups in the pipeline. The groups differ considerably in size and scope. Some are large and put their focus on the organisation of meetings and debates; others are smaller, more regionally oriented. Mostly they start with making a page on Facebook. They come together in the local pub or community centre, hand out pamphlets and deliberate about how to change old systems into something entirely new. The vice-president of the VBi coordinates the ‘Basic teams’.
A crucial achievement of the local groups is that they have convinced municipalities to start experiments with a basic income in their communities.
Utrecht Sunset CC Tambako The Jaguar (flickr)
The pilot in Utrecht among welfare beneficiaries, conceived mainly with the intention to get rid of the sanctions and the obligation to apply for jobs under the current welfare scheme, is set for January 2017. Another four experiments — in Wageningen, Tilburg, Groningen and Nijmegen — will follow as soon as the Secretary of State for Social Affairs and Employment, Jetta Klijnsma (Labour Party), has finalized the administrative decree for allowing experiments in the context of the welfare system.
More experiments will follow as long as basic teams continue to push the local authorities to start pilots with a basic income. Often, these groups are helped by the Dutch Green party, not only on a local level, but also on the national level. In November 2015, the Green Party succeeded in clearing the way for experiments by filing a motion to parliament. It was supported by all political parties, except those of the right-wing liberals of Prime Minister Mark Rutte and the populist Freedom Party of Geert Wilders.
The VBi has also called upon its active members to reach out to co-fighters within their political parties and labour unions and to start discussions during meetings and congresses. As a result, some political parties have positively responded to the idea of a basic income as a social agenda for the sake of the general welfare and against precarious conditions and growing inequality.
After the Green Party and the Democrats 66, the majority (61%) of the Partij van de Arbeid (Labour Party) recently voted for a large experiment with a basic income. The leadership is not yet convinced, but members are very committed to the idea of a basic income and they want the issue to play a major role in the forthcoming campaign for the national elections of March 2017. “A basic income as part of the modern welfare state becomes more and more the ultimate goal for people. A society that includes everyone and where everybody contributes according to their capacities and needs: paid work, volunteering, education, the establishment of a company, et cetera,” says VBi’s most active member in political lobbying.
Many voters of the far left (Socialist Party) endorse the idea of a basic income. However, the leadership has firmly rejected it. Hence the party decided not to adopt it.
Last June, the youth organisation of Democrats 66 passed a policy framework “Moedig Voorwaarts” (Courageous Forward) that states that every adult will receive €600 – €1200 per month and each child €300. The proposal guarantees that nobody will live in poverty. The creation of a basic income is to also be combined with tax reforms.
Last spring a National Poll was held about the following question:
Everyone receives a basic income from the government, regardless of other income and without the obligation to work. The system of taxes and benefits will be adjusted accordingly. Do you find this a good idea?
The results were encouraging: 40% of those surveyed said they are in favour of a basic income as described in the poll, 45% said they are against it and 15% didn’t know.
Most members of right-wing parties declared themselves to be against the idea: 73% of right wing liberals and 61% of the Christian Democrats. Supporters and opponents were roughly in balance among the supporters of Democrats 66: 44% and 45% respectively. Most voters of three left-wing parties were in favour: 60% of the Green party, 54% of the Socialist Party, and 53% of the Labour Party. Interestingly, voters of the populist right-wing Party of Freedom of Geert Wilders were divided: 37% were in favour of the idea, 46% were against it and 17% did not know.
In the Netherlands, people are beginning to recognize that a basic income, as an unconditional floor under the existing welfare state, could be very beneficial for us all by opening up new ways to end inequality, provide stability and freedom to choose. This is especially true for welfare claimants. In recent months, the labour union FNV (Dutch Federation of Trade Unions) organised two rounds of policy debates about basic income with more than 1000 welfare claimants, who are members of an affiliate union. Most of them were in favour of introducing a basic income, because it guarantees financial security, more freedom and less stress. Further, these beneficiaries call upon the FNV Congress 2017 to adopt a proposition stating that the implementation of a basic income will be an explicit trade union objective.
The appetite for such initiatives is also fuelled out of frustration with workfare programmes that turned out to be “hugely expensive and humiliating for those involved”, says Rutger Bregman, the author of Utopia for Realists: The Case for a Universal Basic Income.
Rutger Bregman CC Bond van Nederlandse Architecten (flickr)
Andy Stern, the former president of the Service Employees International Union (SEIU), which represents nearly 2 million American workers, puts it like this in a conversation with Bourree Lam about his book Raising the Floor: “What I’m hoping for is that unions can look up from the defensive crouch they’re in, look into the future, and understand that so many of the things they’re doing now that are enormously important could be very insufficient. And that they’ll begin to think of universal basic income …”
In Christian circles one also hears people making a strong case for basic income. On the website of the Christian union for employees, employers and the self-employed (CGMV), a staff member reacts to the biblical directive that “He who does not work, shall not eat”. In an article with the title “Is everyone entitled to a basic income?”, referring to the many volunteers in organisations that have replaced paid workers, he asks: How then should we interpret another biblical text that says that “a labourer deserves his wages”? How can these volunteers get money to buy food? And how can we defend this attitude towards people who have tried to get a job so hard, but who did not succeed in finding one and who have to deal with rules that cripple their capabilities and creativity?
And there are more projects going on in the Netherlands that draw attention to basic income. A group of citizens has launched a big digital campaign to collect at least 40.000 signatures for the introduction of an unconditional basic income for every adult in 2018. The Parliament is legally obliged to discuss and vote on a topic, once it has been undersigned by more than 40.000 Dutch individuals. Right now (11-07-2016) the counter stands at 51.780 signatures. On to the 100.000! The more signatures, the stronger our voice! See https://basisinkomen2018.nl/.
In April an anchor woman of RTL-Z, an affiliate of the RTL Group (an European entertainment network) in the Netherlands, started the “Basic Income Bullshit Bingo Pot“: every time someone uses the words ‘basic income’ in a wrong way — that is, other than in the sense of an individual, universal, unconditional basic income that is high enough for a dignified life — he or she has to pay a Euro. The pot for the Euro donations can be found here: https://basisinkomen.eu/donatie-aan-vereniging-basisinkomen/.
In May, ‘Haagse Anne‘ (a young woman, artist and living in The Hague) received the second crowd funded basic income for a year. No strings attached! Liesbeth van Tongeren, Member of Parliament for the Green Party, handed her a symbolic plaque. The second publicly financed basic income is an initiative of MIES (Maatschappij voor Innovatie van Economie en Samenleving, a.k.a. Community for the Innovation of Economy and Society).
Another project of MIES, ‘OnsBasisinkomen’ (OurBasicIncome), can be found on this page. Readers are asked to tell what they would do if they were to receive a basic income tomorrow. So far, over 1800 Dutch people have told their story, of which 600 responses have been scientifically analysed. Two provisional findings emerged from the survey: people are not lazy and social participation is a multifaceted concept.
I cannot wait until the next report for this big news: Just a few days ago, the Financiële Dagblad (Financial Journal) announced that four municipalities will get the freedom to experiment with fewer regulations under the existing social welfare schemes. Some of the benefit claimants will be temporarily relieved of the duty to apply for jobs or to follow a reintegration program. Others may earn a bit without having their payment reduced from their benefits. The Secretary of State for Social Affairs and Employment, Jetta Klijnsma, has now agreed because the scientific assessment framework – a partnership between the four major cities and four collaborating universities – is now ready. If after the summer recess the Council of Ministers and the First and Second Chamber quickly agree, the cities of Utrecht, Tilburg, Groningen and Wageningen can start with the experiments in January 2017.
Authors: Florie Barnhoorn, Adriaan Planken
by Michael Lytton | Jul 26, 2016 | Opinion
The editorial below is a response to Pranab Bardhan’s “Could a Basic Income Help Poor Countries?”
Pranab Bardhan is a professor of economics at the University of California, Berkeley. Writing on the Project Syndicate website, he is skeptical about a universal basic income in rich countries, but asks if it isn’t both fiscally feasible and socially desirable in poor countries.
Comparing applicability of a Universal Basic Income (UBI) between advanced and low-or middle-income countries, Bardhan argues that there is a better fit where “the poverty threshold is low and existing social safety nets are both threadbare and expensive to administer.” His response to his own question is still cautious. “In India,” he says, “the answer could be yes.”
Unfortunately, his argument is muddled. He correctly diagnoses the administrative chaos that is India, and identifies sources of funding for a UBI in subsidies and tax exemptions that could be ended. At the same time, he warns that existing key social welfare programs cannot all be eliminated, nor should the government get out of the business of public education, health care, preschool nutrition or employment guarantees in public works. In effect, a UBI would supplement existing programs and thereby loses its rationale as a reducer of bureaucracy.
Bardhan also paints a contradictory picture of the results, describing it as both a “reasonable basic income”, yet “severely limited,” which is why other social welfare programs can’t be discontinued. And ignoring the ample evidence to the contrary from cash transfer experiments in India, he says there is “no way to ensure that individuals would allocate enough of it to achieve socially desirable education, health or nutrition levels.”
Apparently agreeing with “prominent advanced-country economists” who warn that a UBI is “blatantly unaffordable,” Bardhan uses the United States as an example. He writes that an annual payment of $10,000 per adult would “exhaust almost all federal tax revenue, under the current system,”, and suggests that this sort of arithmetic explains the failure of the Swiss UBI referendum last month.
Invoking the specter of affordability to end debate on UBI is reminiscent of earlier and now discredited arguments that it is too expensive to do anything about climate change, which is tantamount to saying our world is short of wealth, so “Say goodnight, Gracie.”
The Global Commission on Economy and Climate makes the evidence-based argument that climate-smart cities can spur economic growth and a better quality of life—at the same time as cutting carbon pollution. Recent research (from economists, no less) has found that investing in compact, connected, and efficient cities will substantially reduce greenhouse gas emissions and generate global energy savings with a current value of US $17 trillion by 2050 (Gouldson et al., 2015).
To these savings can be added reduced pollution impacts and costs. In 2013, the World Bank conducted its first-ever economic assessment of environmental degradation in India and reported the amount to be 5.7% of the country’s GDP (World Bank, 2013). And in another first-of-its-kind study conducted in 2015, the Organisation for Economic Co-operation and Development (OECD) found that air pollution-related illnesses and mortalities cost $1.7 trillion annually in OECD countries, $1.4 trillion in China, and $0.5 trillion in India (WHO Regional Office for Europe, OECD, 2015).
And then there is inequality. The global inequality crisis is reaching new depths, with the richest 1% now having more wealth than the rest of the world combined. The wealth of the richest 62 people on the planet rose by 45% in the five years since 2010 to $1.76 trillion, while the wealth of the bottom half fell by just over a trillion dollars in the same period—a drop of 38% (Oxfam et al., 2016). Meanwhile the tiny elite at the top is using its power and privilege to manipulate the economic system to further concentrate returns to capital.
Paying taxes is not high on the agenda of the absurdly wealthy, and the use of tax havens and other tax-dodging practices afflicts countries of all income levels, even the poorest. It is estimated that tax dodging by multinational corporations costs developing countries some $100 billion annually, and a global network of tax havens enables the richest individuals globally to hide $7.6 trillion. As taxes go unpaid due to widespread avoidance (with political approval and support), government budgets shrink and vital public services and social programs are diminished. Levying higher taxes on less wealthy segments of society just hurts the poor and makes inequality worse.
Despite Professor Bardhan’s quick dismissal, the United States would seem to be a good test case for UBI. For a number of reasons, the country has been characterized as an outlier among developed nations. It is one of the richest in the world, but among wealthy nations it has the highest income inequality. It has high private but low public social spending, with vast differences within the country as a result of states’ rights under federalism. Public expenditures have tended to shift toward the disabled and elderly, and away from those with the lowest incomes—consistent with a widespread belief that people are poor because of laziness or lack of incentive. Tony Judt’s rejoinder is, “Anyone who thinks that the poor like living on a pittance should try it.”
There is bipartisan aversion to taxes, especially among the rich — it is difficult to imagine how much worse income inequality might be had the United States spent even less on reducing poverty. Progressive taxation that would redistribute wealth from the rich to the poor is political anathema, and taxation is increasingly regressive—the poor pay higher effective tax rates than the rich. Enforcing tax avoidance and tax evasion is correspondingly weak.
It is one of the richest nations in the world, and yet among the 35 wealthiest countries it has the second highest child poverty rate (Adamson, UNICEF, and Innocenti Research Centre, 2012). More than one in five children is food insecure, and nearly one-third of U.S. children are in a household where neither parent holds full-time, year-round employment. The cost of child poverty in economic and educational outcomes has been recently estimated to be half a trillion dollars a year, or the equivalent of nearly 4 percent of the Gross Domestic Product (Coley, J. and Baker, 2013).
Reducing child poverty seems sufficient in itself to justify a UBI experiment. Not only would public social assistance costs fall, but families with more income are better able to purchase nutritious meals and better housing, and support child development with higher quality family relationships and parental interactions. Some observers warn that current poverty levels combined with the growing wealth gap threaten to destabilize the US democracy and curtail the social and economic mobility of children for generations to come (Coley, J. and Baker, 2013).
Professor Bardhan would also have found money for UBI just by crossing the Berkeley campus. His colleagues at the Institute for Research on Labor and Employment (IRLE) published a research brief in 2015, titled The High Public Cost of Low Wages: Poverty-Level Wages Cost U.S. Taxpayers $152.8 Billion Each Year in Public Support for Working Families.
Over the past three decades the share of income going to labor has been declining in most countries around the world, while the capital share has been rising. Unemployment is part of the problem. The International Labour Organization (ILO) estimates that over 201 million people were unemployed around the world in 2014, an increase of over 31 million since the start of the global financial crisis. The ILO reports that this trend is common in all regions of the world, despite an overall trend of improved educational attainment. At the same time, wages are not keeping up with the productivity of workers. In the US between 1973 and 2014, net productivity grew by 72.2 percent, yet inflation-adjusted hourly pay for the median worker rose by just 8.7 percent. (Oxfam et al., 2016).
As the authors of the IRLE research brief point out, when jobs don’t pay enough workers turn to public assistance to meet their basic needs. These programs provide vital support to millions of working families in the United States whose employers pay less than a living wage. The researchers found that between 2009 and 2011, more than half of the combined state and federal spending on public assistance went to working families—a total of $152.8 billion per year. “Overall, higher wages and employer provided health care would lower both state and federal public assistance costs, and allow all levels of government to better target how their tax dollars are used” (Jacobs, Perry, and MacGillvary, 2015).
Next stop for UBI, the United States.
Sources:
Adamson, Peter, UNICEF, and Innocenti Research Centre. 2012. Measuring Child Poverty New League Tables of Child Poverty in the World’s Rich Countries. Florence, Italy: UNICEF Innocenti Research Centre.
Coley, J., Richard, and Bruce Baker. 2013. Poverty and Education: Finding the Way Forward. Princeton, NJ: Educational Testing Service, Center for Research on Human Capital and Education.
Gouldson, A. P., S. Colenbrander, A. Sudmant, N. Godfrey, J. Millward-Hopkins, W. Fang, and X. Zhao. 2015. “Accelerating Low Carbon Development in the World’s Cities.”
Jacobs, Ken, Ian Perry, and Jenifer MacGillvary. 2015. “The High Public Cost of Low Wages: Poverty-Level Wages Cost U.S. Taxpayers $152.8 Billion Each Year in Public Support for Working Families.” Institute for Research on Labor and Employment, UC Berkeley Center for Labor Research and Education.
Oxfam, Deborah Hardoon, Sophia Ayele, and Ricardo Fuentes Nieva. 2016. An Economy for the 1%: How Privilege and Power in the Economy Drive Extreme Inequality and How This Can Be Stopped. Briefing Paper 210. Oxford, UK: Oxfam GB for Oxfam International.
WHO Regional Office for Europe, OECD. 2015. “Economic Cost of the Health Impact Air Pollution in Europe: Clean Air, Health and Wealth.” WHO Regional Office for Europe, Copenhagen.
World Bank. 2013. “India-Diagnostic Assessment of Select Environmental Challenges: An Analysis of Physical and Monetary Losses of Environmental Health and Natural Resources.” World Bank.
by Kate McFarland | Jul 24, 2016 | News, Testimonies
Harmony Hackney describes herself as a “housewife and quasi-revolutionary who went to school for motorcycle repair, where she went $9k into debt to learn how to read the manual, and an Associate in Science in paralegal studies, where she went $15k in debt to learn how to read the manual.” Since neither motorcycle repair nor paralegal work panned out as a career, Harmony now studies the history of her home state of Florida and “the nine generations of Floridians who came before her.” She plans to publish a book on the subject in the near future.
In this Basic Income Interview, Harmony was asked how she learned of basic income and why she supports it. Here is her reply:
I was looking for alternatives to the way the majority of us struggle each day and only manage to accomplish the barest levels of survival for our cultures. Since we have an abundance of things, but not an abundance of consumers, basic income seems like the most reasonable solution.
I support a basic income because it’s cheaper and more effective than our current process. My family has never been very well off; we’ve only ever managed minimal survival. My parents would work two and three jobs and we still couldn’t climb any higher. So we had to rely on assistance. For each piece of the process we had to go to a different office, fill out tons and tons of forms, get mailed tons of forms, mail back tons of forms, and spend a lot of time just waiting to fill out more papers or turn in more papers. That was back before the internet, but honestly the process hasn’t changed much. It’s still a series of separate offices, separate parts of the government, and separate places to fill out and turn in various forms. Now think about the cost of all that. How much is it costing to manage all of those forms and papers and all of that redundant information? And all of this serves no other purpose other than prevent just handing money to people.
We have entire sections of our government doing nothing but acting as a middleman between money and people who need money. When you go down and file for food assistance, you fill out all your forms, get approved, and they give you a card with a sum on it. Only that sum is in a special currency so that you don’t get real money. An entire section of government is devoted to calculating, managing, overseeing, enforcing, investigating, and distributing this special currency, which is additionally regulated so that it can only be used for these specific things. In addition, we have a whole other section of government that then collects this special currency, with all the bureaucracy that entails, who then redistributes the special currency as money. Imagine how much we could save if we simply eliminated all the extra stuff and just handed everyone a set amount of money.
And more than just saving money, we could save our environment as well. Think about how much we produce that gets thrown away because people couldn’t buy it. But we have to keep producing at that amount, and work to produce even more, so that we can make enough to live on. In addition to that, most of our jobs are make-work. It’s work that’s created just to say you are working. We have an abundance of fast food, retail, and other service jobs that can easily be automated. But we don’t because low wage workers are cheaper, and because we have been conditioned to believe that our existence is only justified if we are part of the workforce.
Most of my free time is spent studying and writing about history. I’ve discovered some very fascinating things that no one else has had the time to research. I’m being encouraged by other history professionals to continue my work and eventually publish my findings. Unfortunately, I’ve reached a point where I have to go to where records are in order to complete my research. Since we live paycheck to paycheck, with nothing to spare, I can’t finish my research. This is why it bugs me when someone says that a basic income will make people lazy. I’m not lazy now. Why would I suddenly become lazy just because I can choose to prioritize my time to suit me instead of a corporate machine?
Photo used by permission of Harmony Hackney
Basic Income Interviews is a special recurring segment of Basic Income News, introduced in July 2016 by Jason Murphy and Kate McFarland. Through a series of short interviews, we aspire to display the diversity of support that basic income receives throughout the world.
Have your own thoughts to contribute? Want to see yourself in a future Basic Income Interview?
Visit our interview form to let us know who you are and why you support basic income.
by Guest Contributor | Jul 22, 2016 | Opinion
It was a remarkable moment in 1969 when President Nixon offered universal basic income (UBI) legislation that was passed twice by the US House of Representatives, but failed to garner enough votes in a Democratic controlled Senate on both occasions. It was defeated despite the intellectual clout of 1200 bi-partisan economists, including Milton Friedman who designed the “guaranteed income” bill, and John Kenneth Galbraith who publicly supported the bill. The irony: a public welfare program proposed by Republicans was stalled by Democrats, who viewed the suggested $1,600 ($10,000 in today’s dollars) per year for each recipient as insufficient. [1] While Europe maintained a broad network of intellectuals, publications, and conferences promoting the idea, UBI policy has been largely absent from American political discourse ever since, other than among a committed following on Reddit, some forward thinking academics, and US affiliates of BIEN.
Andrew L. Stern
President Emeritus SEIU
Columbia University Richman Center
Ronald O. Perelman Senior Fellow
Over the past year, though, growing support from an array of thought leaders suggests a rising tide for UBI in the US. President Obama, in an interview with Bloomberg News this June, discussed the need to “build ourselves a runway” to ease the transition into an increasingly automated labor force. [2] Bernie Sanders has, on multiple occasions, expressed his support of UBI, stating in a 2015 interview that he is “absolutely sympathetic to that approach.” [3] Recently, UBI has received full-throated support from leading thinkers like Berkeley’s Robert Reich, Columbia’s Joseph Stiglitz, INET President Rob Johnson, Google CEO Eric Schmidt, former Zipcar CEO Robin Chase, Judith Shulevitz – writing in the New York Times, and Nobel Laureate Angus Deaton. This June past, my book Raising the Floor: How a Universal Basic Income Can Renew Our Economy and Rebuild the American Dream was released, and has helped to expand the discussion of UBI to progressives, unions, and mainstream media outlets like the FT, CNBC, NPR, Fortune, and the New York Times.
Matthew Kessler-Cleary
The interest in UBI is gaining prominence and commentary in mainstream think tanks across the political spectrum, which is an anomaly in our modern, divided political dynamic. From the progressive to libertarian poles, at places like Roosevelt Institute, INET, OSF, CATO, and AEI, basic income is gaining support as a solution to the economic crises of our present, and future. In the fall, the CATO Institute, whose Michael Tanner is a libertarian thought leader and key discussant in my book, is planning to host a forum in Washington, DC including Charles Murray and myself.
Global developments around UBI should also help to bolster UBI’s place in American political discourse. Canadian Prime Minister Justin Trudeau has incorporated basic income into the Liberal Party’s platform, [4] and Canada is preparing a basic income experiment for residents of the Ontario province.[5] Following the city of Utrecht’s decision, several other Dutch cities will test basic income policies in the coming years. [6] As these trials play out, hopefully with positive results or lessons that allow for improvement, the American public and their elected officials will have solid evidence upon which an American policy, perhaps city or state based experiments, can be built. Already, a small-scale basic income experiment will be carried out by Y-Combinator in Oakland, where unconditional income will be provided to roughly 100 Oakland residents for 6-12 months. [7]
In my book, I state that the American response to the tsunami of job upheaval will look more like the response to the Vietnam, rather than the Iraq War. In the Vietnam era a draft placed the children of middle-class families at risk, as they are again, as present and future technologically motivated job loss does not spare college graduates or white-collar occupations.
During the Vietnam era, the selective service draft mobilized parents from every walk of life to be vocal anti-war activists. Once their own children could be drafted to fight and die, many parents began questioning whether President Johnson had any justification for sending troops there. The draft also mobilized young people: Vietnam did not fit into their college and career plans, nor did the idea of killing people or getting killed in a far-off land.
Job loss has for too long been considered a condition of a more blue-collar, uneducated, and low-skill labor force. Not only is this prejudicial and inaccurate, but it is no longer supported by employment statistics. Unemployment and underemployment among recent college graduates is still significantly higher than pre-Recession levels, indicating that in the New Economy, white-collar jobs are susceptible to job erosion much as blue-collar jobs have been for the past several decades. [8] So while it was easy for legislators, prominent thinkers, and middle and upper class individuals to discuss job loss from the comfort of their personal professional security, as economists still do, they and their children are increasingly affected by the shifting labor paradigm. Job loss and erosion in the white-collar economy has the potential to mobilize a far more diverse and broad political movement to search for solutions to the economic and employment challenges of the future.
While there is a myriad of ideas on how to combat the restructuring of our emerging socio-economic paradigm, none have as of yet enjoyed the broad political support that UBI does. None provide such a simple means of addressing very complex problems: ending poverty; offering stability during any economic transition; or providing for universal assistance as technology creates a tsunami of labor market disruption. In the United States a new conversation has started on UBI, and it is our responsibility to ensure that the momentum does not wane. The time is now, and the solution is simple: make Universal Basic Income an American reality.
References
[1] https://www.jacobinmag.com/2016/05/richard-nixon-ubi-basic-income-welfare/
[2] https://www.bloomberg.com/features/2016-obama-anti-business-president/
[3] https://www.vox.com/2015/7/28/9014491/bernie-sanders-vox-conversation
[4] https://www.liberal.ca/policy-resolutions/97-basic-income-supplement-testing-dignified-approach-income-security-workingage-canadians/
[5] https://qz.com/633974/ontario-canada-announced-a-plan-to-test-universal-basic-income-for-all-citizens/
[6] https://qz.com/473779/several-dutch-cities-want-to-give-residents-a-no-strings-attached-basic-income/
[7] https://blog.ycombinator.com/moving-forward-on-basic-income
[8] https://www.epi.org/publication/the-class-of-2015/
by Citizens' Income Trust | Jul 15, 2016 | Opinion
Author: Frances Hutchinson
The simple question, alluded to in the title of this article, is: ‘How do we end the wages system?’ That raises further questions – ‘Why end the wage system? What is wrong with it?’ or the fundamental question: ‘What is the wages system?’ It is my contention that all social and environmental reforms which ignore the role of money in directing human activity are doomed at best to be palliative, addressing individual causes for concern whilst ignoring the root causes from which the individual problems stem. As Marx and Veblen were well aware, the wages system lies at the heart of social injustice and ecological unsustainability. So long as absentee owners direct the work of waged or salaried employees (whether in private or state corporations), the motivation for reform will be constantly frustrated. Where money is the master motivation, all other values fade into subsidiary considerations. The major debates currently raging about war, famine, agribusiness, debt, environmental/ecological degradation, GM, world trade and poverty all stem from one central cause. People are held into doing what they are doing because they seek to profit financially from their cooperation with others. Whether the ‘profit’ is from speculative sale or sale of labour time becomes immaterial. Both are beholden to the same phenomenon: money is the first consideration in determining a course of action. The money economy is dividing people not only from their work and its product, but also from the land that ultimately sustains all forms of human society. If one cannot live on bread alone, one certainly cannot live on money at all. It is absolutely essential that material goods and services exist, and that the resources necessary for the production of those resources are cultivated and conserved. The money economy has come to obscure the practicalities of everyday life.
The money economy
With industrialisation, we were liberated economically from traditional social ties, only to become enslaved by a money system operating beyond everyday comprehension. Rights and responsibilities associated with respect for the ‘commons’ and social justice are swept aside in favour of economic pressures. Money is enthroned in a place of identifiable individuals whose ability to hold sway over others could be monitored by a system of checks and balances which, however imperfect, nevertheless made the oppressor ultimately accountable. When it comes to money management and distribution, some people struggle to meet ends. Although, it should be noted that the availability of home loans and auction finance do people grapple with the tight market. The present system of income distribution has come to seem as natural – even if as unpredictable – as the weather. Incomes are the reward for participating in the formal economy, regardless of whether the work is constructive or destructive of welfare.
As we have observed (Hutchinson et al., 2002, pp.42- 43), oikonomia, the material economy where tangible and useful wealth is created, is now dominated by chrematistics, the money economy that is parasitical upon oikonomia. The ‘real’ economy is the one that ‘earth has given and human hands have made’. The money economy takes from the God-given earth, and from human society, destroying and not replenishing. In short, we have an insane system of economics that counts waste, devastation, pollution, war and social devastation as ‘wealth’.
Take just a few examples. Perhaps car accidents and legal issues surrounding them. Or even environmental disaster adds to GNP (the over-all measure of total national wealth) because of the increase in economic activity – such as fire services, car replacement, ambulance, medical, insurance, and of course the legal costs for a car accident attorney springfield has to offer, and so on that it causes. With more than 11 million car accidents in the United States itself, there are many that lose their lives in the unfortunate occurrence. A lot of their economic activities, get halted if the deceased was the only earning member of the family. For this reason, they would need a personal injury lawyer to represent them in court to receive compensation, as deemed fit by the judicial system.
Furthermore, in the formal economy, food is manufactured, not by God, but by the ‘food industry’: in 1971 a food industry study found that total food expenditure in 1971 need only have been £1,800 million to provide a varied and healthy menu. It was actually £6,636 million – i.e. the food industry added four and a half thousand million pounds – in processing, preserving, packaging, and so on, with all the attendant waste and pollution. In chrematistic terms, we were all ‘better off’. Today, international rulings force small farmers in poor countries to abandon sustainable and reliable practices for mono-cultural cash crops for export. Across the world, ‘financial services’ and dealings far outweigh trade in actual goods and services, which form a mere 5 per cent of the total. The money economy continues to sweep across the world, devouring land and cheap labour sources, leaving social and ecological devastation in its wake. In Hong Kong firms no longer manufacture goods: they merely trade in goods produced in the cheap labour factories, spreading across China. Already, a decade ago, 85 per cent of China’s rivers were dead. The key players: corporations, academics, and politicians – are mesmerised by the money system. In purely chrematistic terms, we are all ‘better off’ if we work for money, regardless of the social and ecological impacts of that work.
Citizen’s Income and the National Dividend
Citizen’s Income seeks to alleviate poverty, particularly family poverty, under capitalism. Arguments for it flow from the observed shortcomings of the welfare system instituted by Beveridge in the aftermath of World War II. The arguments are often accepting of the terms and premises of the capitalist financial system, and sometimes – but not always – assume that full employment and a growing economy are needed to provide the means to pay for Citizen’s Incomes.
The Social Credit movement emerged from a very different stable. Just over one hundred years ago, Europe was plunged into a senseless war. In a brief moment of sanity, young soldiers on the front lines joined hands in singing Christmas carols. People then and since have asked why war is necessary. The Social Credit movement became a worldwide political force working to end war, environmental degradation and economic growth based upon war and built-in obsolescence. Its message was plain and clear. There is enough for everyone’s need, though not for everyone’s greed.
Clifford Hugh Douglas, author of the original Social Credit texts (See Hutchinson and Burkitt, 1997) considered the expenditure of human life and resources in the Great War something to be learned from, rather than something to be repeated for the sake of creating a strong, financially sound, economy. Social Credit was part of a much wider social movement in the so-called ‘inter-war years’ of the twentieth century. Progressive thinkers from all classes and all walks of life questioned the wisdom of basing the formal, finance-driven economy on production for war, waste and consumerism.
Douglas brought his shrewd, common-sense, analytical mind to bear upon the practicalities of the workings of the money economy. As the 1914-18 War raged across the world, factories were working at full capacity. Vast quantities of armaments, uniforms, tanks, machinery, ships and other forms of transport were churned out on all sides. Farmers on the land prospered, supplying food to the armies of military and civilian workers. But the apparent prosperity was ephemeral because it was dependent upon the workings of an unsound financial system. As the war ended, Douglas was an obscure engineer accounting the finances at Farnborough aircraft factory. He predicted the inter-war depression and explained how it would happen and why. He detailed how the finance to run the war was conjured up by the Government as debt, when it could just as easily have been created as credit, in which case the prosperity would continue after the War.
In the immediate aftermath of the War (1918-20) Douglas wrote a series of articles on finance and income distribution. These were closely studied amongst trade unionists, politicians, economists (including Keynes), and a wide spectrum of intellectuals. A vast literature on Social Credit, including weekly newspapers, books, pamphlets, and journal articles, circulated throughout the UK, the Commonwealth, the US, Scandinavia, and Tokyo in multiple editions. Douglas’s predictions were correct, and his work has never been faulted. What is physically possible is always financially possible, because finance is a man-made system of accounting, and can be adjusted to meet the will of the people.
At the heart of Social Credit theorising is the justification for paying a National Dividend to all citizens regardless of work status on grounds of the common cultural inheritance. Douglas argued that labour – paid work – does not create wealth: ‘The simple fact is that production is 95 per cent a matter of tools and process, which tools and process form the cultural inheritance of the community as a whole’, being the result of work done over generations by an army of technologists, the vast majority of whom are now dead (Douglas, 1919, p. 95). Thus claims to a share of the common cultural inheritance, which rightly belongs to the community as a whole, can be justified not by work, and not by private ownership of land and property, but by common right of citizenship. Over a period of three decades Douglas argued consistently that finance is purely a matter of accounting: what is practical and desirable on social grounds is financially possible, because finance is a man-made system. The key to economic democracy is the political will to bring about legal change.
Women and Social Credit
Proposals for a non-means-tested National Dividend, payable by right of citizenship, were of particular interest to women. Although Social Credit was not specifically a women’s movement, women who studied the economics of the social credit movement in the interwar years campaigned on the basis of its potential for improving the socio-economic status of women. Their arguments are echoed in current studies of mothering and home-making:
Mothers in the United Kingdom today are in an impossible situation. Our very title has been erased from Government policy on families [Guidance for Government Departments October 2014] and general political discussion in a pernicious Orwellian language trend. Women who are mothers are expected to engage in the workforce in a liberalist and capitalist tradition of individual interest where market forces reign supreme – there is no room for love and care, let alone awareness of interdependency common to all our lives. There seems to be no place for maternal care. No place for improved, supported services investing in family life.
So writes Vanessa Olorenshaw in her groundbreaking pamphlet, The Politics of Mothering.
Women activists of the 1930s argued that Social Credit offers every woman and man a birth-right income based on the productive capacity of the community. It would:
… ensure economic independence and freedom, for it will release her from being tied to the home when she wishes to live her own life or bound to some man who ill-treats her. Nor would she be driven to work-wage slavery in competition with men in order to stay alive when she has caring responsibilities within the household. Women would get equal pay for equal work because ‘a Social Credit Government will naturally stand for fair play for all citizens without distinction’. Each individual woman will be able to say ‘If I do this job as well as a man could do it, I shall want the same pay as a man.’ And if the employer says, ‘No’, she will be able to say: ‘Very well, I refuse the job. After all, I can live on my National Dividend.’ This places every woman in a very powerful position. (It will apply equally, of course, to badly-paid male workers.) (Quoted in Hutchinson and Burkitt 1997)
Women were politically active in support of the proposals throughout the UK, Canada, Australia, New Zealand and the United States over the middle decades of the twentieth century.
From master to servant
Central to the Social Credit debate are the core issues of farming, finance, and the household. To date, mainstream economic theory has failed to accommodate itself to the realities of economic life. These include the futility and waste of war, which is officially accounted as a plus, and the need for income security so that good work may be undertaken in the home, in the community, in local businesses, and on the land. Today, concerned individuals and groups are bringing forward the identical issues as those surrounding the massive international debate based upon the writings of C.H. Douglas less than a century ago. Douglas asked the fundamental question – why should it be ‘absolutely necessary’ for the workers to produce weapons of mass destruction in order to put food onto the household table? His question remains as valid today as when he first posed it a hundred years ago.
Frances Hutchinson is the author of Understanding the Financial System: Social Credit Revisited (2010) and of The Economics of Love, forthcoming.
References
Douglas, Clifford Hugh (1919) Economic Democracy
Hutchinson, Frances (2005) If citizen’s income is the answer, what is the question?, European Business Review, Vol. 17, No.2. pp193-200. www.emeraldinsight.com/charter
Hutchinson, Frances and Brian Burkitt (1997) The Political Economy of Social Credit and Guild Socialism, Routledge (Jon Carpenter 2005 reprint).
Hutchinson, Frances, Mary Mellor and Wendy Olsen (2002) The Politics of Money: Towards Sustainability and Economic Democracy, Pluto Press.
Olorenshaw, Vanessa (2015) The Politics of Mothering, available from www.facebook.com/Politics of Mothering.
