by Vito Laterza | Dec 10, 2015 | News
At the end of November, a coalition of eurozone campaigners, civil society organizations and economists launched the campaign Quantitative Easing for People, calling for the European Central Bank (ECB) to radically change its approach to the current Quantitative Easing (QE) program. At the time of writing, 75 economists have endorsed the campaign.
The initiative brings together groups including Social Justice Ireland, Collectif Roosevelt (France), World Future Council (Germany), FairFin (Belgium), European Alternatives, and Basic Income Europe. The campaign is also supported by organizations from Italy, Greece, Spain, Austria, and the Netherlands; see the full list here.
QE is an unconventional monetary policy used by central banks to stimulate the economy. It usually consists of buying government bonds or other securities in order to lower interest rates and increase the money supply. QE began in the eurozone earlier this year, and the ECB is currently creating 60 billion Euros each month. Matthias Kroll from the World Future Council said: “So far the ECB’s QE program has proven to be ineffective in raising inflation back to its 2% target.”
“Flooding financial markets inflates share and bond prices, which makes the rich richer, but does little to help households and business. In fact, QE is helping fuel a new financial bubble, laying the foundation for another financial crisis. The eurozone needs a more direct and efficient stimulus.”
European stock markets plunged on December 3, when Draghi announced that the current QE program would be extended by six months to March 2017. This is a sign that even large corporations and financial markets do not believe in Draghi’s QE and expect more.
The aim of the QE for People campaign is to push the ECB to spend the money differently, by focusing on public investment, key social services or redistributive mechanisms like a citizens’ dividend – the last idea resonating well with basic income activists.
The proposal was first put forward in a letter signed by 19 economists and published in the Financial Times in March this year:
Rather than being injected into the financial markets, the new money created by eurozone central banks could be used to finance government spending (such as investing in much needed infrastructure projects); alternatively each eurozone citizen could be given €175 per month, for 19 months, which they could use to pay down existing debts or spend as they please.
Cash transfers under QE for People and basic income have common features. Both are directed to all citizens, with no strings attached. The time dimension differs though, as QE measures are by definition temporary, while basic income is a permanent scheme.
The 75 experts who support the campaign include several pioneers of the idea, such as Professor Steve Keen, Professor David Graeber and fund manager Eric Lonergan, as well as other influential economists and financial analysts like Ann Pettifor and Frances Coppola. These experts signed a statement of support that lays out the reasons behind the campaign:
1. Conventional QE does not work
Since it started in March, the eurozone QE program has not helped to rescue the eurozone economies from stagnation.
2. Conventional QE is risky and harmful
Flooding financial markets inflates share and bond prices, which makes the rich richer but does little to help ordinary people and businesses. In fact, QE is helping fuel a new financial bubble, laying the foundation for another financial crisis.
3. A more direct approach is needed
Countries in the eurozone need to stimulate their economies without increasing public and private debt, without increasing inequality, and without creating bubbles.
4. QE for People is possible
Instead of flooding financial markets, money created through QE should be spent into the real economy, on essential public investment such as green infrastructure, affordable housing and/or distributed as a citizens’ dividend to all residents.
5. QE for People is urgently needed
Given the challenges facing the eurozone, we urge economists, civil society organizations, and people from across the eurozone to join us in calling on the ECB to implement QE for People as soon as possible.
The campaign will focus on raising awareness of the failures of the current QE program, building political momentum around alternative monetary policies and fostering further research. “Having more than 70 economists endorsing the idea is a huge milestone, but this is only the beginning. Our goal is to create a much bigger coalition with citizens, academics and civil society organizations,” said Stan Jourdan, campaign coordinator.
If you want to know more about the campaign, visit the campaign website.
You can join the movement QE for People by signing up here.
Economists can endorse the campaign here.
See also: Stanislas Jourdan, “Europe: 19 economists call on the ECB to make ‘QE for the people’ in a letter to the Financial Times,” Basic Income News, March 27, 2015.
by Vito Laterza | Dec 8, 2015 | News
Guy Standing, renowned economist, noted author and honorary president of BIEN, was recently interviewed by the Equal Times, a global media platform that focuses on work and social justice.
Guy Standing makes a forceful case for basic income that takes into account the current global conditions of the labor market and the economy. He draws on his vast wealth of knowledge and presents complex concepts in a clear and synthetic manner.
Standing argues that:
– Basic income is key to get people out of the poverty trap, as people experience few gains merely by moving from unemployment benefits to low-paying jobs.
– Trade unions’ opposition to basic income is misguided, as unions and workers would actually benefit from a basic income.
– The struggles for a minimum wage are a positive development, but a minimum wage does not guarantee the welfare of the growing number of people who are not formally employed.
– Evidence from projects in Africa and India indicates that people are more cooperative and more productive when given a basic income, contrary to fears that a basic income would reduce productivity.
– An unconditional basic income would be an effective tool to fight poverty in developing countries, whereas conditional forms of social assistance drive down wages and increase dependency and exploitation.
– Basic income is affordable. One way to finance it is to overhaul the existing benefit system, while also cutting subsidies and tax breaks to big corporations and rich people.
– Basic income is not a panacea, but an essential measure to improve the worsening conditions of the “precariat”, the growing class of people who have little or no prospects of finding a full-time permanent job in their lifetime.
Chris Burns interviews Guy Standing, “Most unions have failed to respond to the needs and aspirations of the precariat,” Equal Times, November 26, 2015.
by Tyler Prochazka | Nov 29, 2015 | News
“Tom Woods by Gage Skidmore 3” by Gage Skidmore. Licensed under CC BY-SA 3.0 via Commons – https://commons.wikimedia.org/wiki/File:Tom_Woods_by_Gage_Skidmore_3.jpg#/media/File:Tom_Woods_by_Gage_Skidmore_3.jpg
Libertarians are known for their general skepticism toward government programs. However, some libertarians have still flirted with the idea of a Basic Income Guarantee (BIG) as an alternative to the current welfare state. Tom Woods, a noted advocate of libertarianism, recently debated BIG advocate Matt Zwolinski on his podcast.
Zwolinski argued that a BIG can be defended from the standpoint of pragmatic politics from the standpoint of justice. He suggested a plan in the vein of that recommended by libertarian economist Charles Murray: an annual $10,000 cash payment to every American adult.
Woods challenged Zwolinski on the basis that a BIG would violate an individual’s right to the fruits of their labor.
Zwolinski responded that many libertarians hold “idealized” accounts of how individuals accumulated property in the past, ignoring the injustices created as property was and is distributed. A BIG could alleviate some of the inequality caused by these injustices, Zwolinski argued.
Taking on a Georgist position, Zwolinski said that property cannot be fully owned. Ignoring the unjust way property came about and failing to rectify it through a policy like a BIG is a “rationalization of privilege,” he said.
For the full YouTube video of the podcast, click here.
by Will Wachtmeister | Nov 21, 2015 | Opinion
A Swedish Green Party motion to investigate basic income policy options has injected new life into the UBI debate in Sweden. Several established commentators are finally engaging with the issue after a long period of ignoring or instantly dismissing the idea.
The Greens called for an inquiry into the effects of introducing a basic income at their party conference over the summer which predictably – given the political climate in Sweden – attracted much knee-jerk ridicule.
Swedish public intellectual Roland Paulsen
However, recently several heavy-hitting publications have run opinion pieces on the issue even if most are negative.
The debate has clearly been spurred on by additional factors such as moves towards basic income in neighboring Finland. There has also been tireless campaign work carried out by Swedish grassroots civil society groups and media advocacy by a number of public intellectuals, notably Roland Paulsen.
Well-established evening newspaper Expressen, a popular centre-right publication, this month ran an in-depth pro-UBI essay by Malin Ekman arguing that “a basic income for all” is far more realistic than “jobs for all” in tomorrow’s digital economy. The paper’s main national politics commentator has in the past dismissed the Greens’ basic income proposal as “immature” without further comment.
The moderate-conservative broadsheet Svenska Dagbladet earlier ran an in-depth essay by the center-right Center Party’s chief economist who called the implications of the basic income proposal “devastating for the economy and the environment” and said it reflected the Greens’ supposed “muzzy and unworldly” approach to politics.
The left-leaning cultural magazine Arena has also attacked basic income with an opinion piece by a macroeconomist saying UBI supporters were keeping silent about Sweden’s major refugee crisis because they knew their policy would only make the situation more difficult.
The nascent debate is taking place in a context where the prime minister’s Social Democratic Party remains wedded to its traditional active labor market approach, and a mix of demand-led and supply-side economic policies, to combat unemployment. The center-left government, which includes the Green Party, has set a goal of reducing unemployment to five percent by 2020, a target that has been widely condemned as unrealistic.
Further reading in SWEDISH:
Malin Ekman, “Medborgarlön allt mer realistiskt instrument” [Citizen’s income getting increasingly realistic as a policy] Expressen, 2 November 2015
Karl-Gösta Bergström, “Miljöpartiets fem omogna beslut” [Five immature decisions by the Green Party], Expressen, 14 June 2015
Roland Paulsen, “Att straffa de arbetslösa är en grymhet av historiska mått” [Punishing the unemployed is an injustice of historical proportions] Dagens Nyheter, 15 July 2015
Martin Ådahl, “Medborgarlön är dåligt för miljön” [Citizen’s income is bad for the environment] Svenska Dagbladet, 7 October 2015
Anders Bergh, “Därför tror ingen på basinkomst” [Here’s why no-one believes in basic income] Dagens Arena, 2 November 2015
by Andre Coelho | Nov 8, 2015 | News
Paulo de Morais
Presidential candidate Paulo de Morais is focused on corruption and ethics in politics. Interested in social justice and ethical behavior, he has agreed to meet the local group of basic income (BI) activists in Lisbon, to deepen his knowledge on what is BI and how to implement it. Although he objects certain implementation factors for BI in Portugal, as changing certain taxation rules (details here), he presently supports a form of resource-based redistribution of wealth. This redistribution could be considered a BI, although linked with money accrued from managing natural resources, public properties and so on. He clearly states that it is only right to give back to the People what is owned and managed by (or for) the People.
Paulo de Morais argues that financing BI with taxes from income is prone to reactions, linked to giving money to everybody, including alleged idle people. This and constitutional hurdles from redirecting public money to a future kind of BI Fund. Although all these aspects are discussable, he still only supports, for the moment, a BI funded by natural/ownership-based wealth collection.
Together with two other presidential candidates Manuela Gonzaga and Paulo Borges, Paulo de Morais joins a growing number of BI leaning political activists in Portugal.
More information at:
In Portuguese:
Paulo de Morais presidential campaign Facebook page.
Lisboa BI group Facebook page.
