by Citizens' Income Trust | Jan 3, 2014 | Opinion
Malcolm Torry, Money for Everyone: Why we need a Citizen’s Income, Policy Press, 2013, xiv + 300 pp, 1 44731 125 6, pbk, £24.99, 1 44731 124 9, hbk, £70
From the book:
The structure of the book
Following some notes on terminology and on graphical representation, chapter 1 sets the scene by asking the reader to imagine themselves trying to solve the financial crisis, to imagine some representative people trying to cope with our tax and benefits system, and to imagine themselves creating a tax and benefits system in a country without one. The second chapter offers a historical sketch, because it is helpful to know where we have been before we set off into the future; and chapter 3 discusses existing schemes similar to a Citizen’s Income and also some Citizen’s Income pilot projects. Chapter 4 discusses the changing labour market and the changing family in order to locate our discussion of benefits reform in its context, and asks whether people would be more or less likely to seek paid employment if they were in receipt of a Citizen’s Income; and chapter 5 establishes a set of criteria for a successful benefits system and judges both the current system and a Citizen’s Income against those criteria. Chapter 6 discusses poverty and inequality and asks whether a Citizen’s Income would tackle them; chapter 7 explores the notion of citizenship in order to decide who should receive a Citizen’s Income; chapter 8 asks whether it would be ethical to pay a Citizen’s Income; and chapter 9 explores a variety of political ideologies’ possible responses to a Citizen’s Income in order to discuss whether a Citizen’s Income is ever likely to happen. Chapter 10 asks whether we can afford a Citizen’s Income and discusses funding mechanisms; chapter 11 discusses a variety of other reform options, and some issues not tackled in the rest of the book; and a brief chapter 12 offers a summary argument for a Citizen’s Income. (p.viii)
A review by Professor Bill Jordan
This is a very important contribution to current debates about tax-benefits systems. In his carefully-argued and comprehensive examination of the case for and against Citizen’s Income, Malcolm Torry presents an updated and extended review of the state of play in the UK and worldwide. Even as some developing countries are experimenting with versions of the idea, ours seems as far from doing so as ever, despite its obvious advantages.
We are living through the most recent of a series of missed opportunities for the principle of state payments to all citizens to be accepted. Whereas the others (such as the introduction of contributory National Insurance benefits and National Assistance after the Second World War, and of Family Income Supplements for low earners in 1973) were innovations in income maintenance systems, the present one combines financial and fiscal crisis with the consolidation of means-testing and coercion through ‘Universal Credits’. As Torry points out at the start of the book, ‘money for everyone’ could have been an alternative approach to both the bail-out of the banks and the Duncan Smith reforms
The early chapters of the book set out the processes through which our present mix of universal, contributory and selective benefits was established, how universality as a principle was accepted in the case of Child Benefits, and how a CI scheme might be implemented (for specific groups first, or at a low initial level). There follow four chapters on criteria for a benefits system, demonstrating that CI scores well for coherence and simplicity, adaptability to changing family patterns, supplying incentives, efficiency and dignity, and appropriateness for a flexible labour market.
He analyses with care the issues of work motivation and the responsibilities of citizens raised by the proposal, acknowledging that prejudice and timidity have influenced political responses to the idea, even in the face of strong evidence. For instance, despite the finding from a CI experiment in a district of Namibia that people engaged more in work and education, the government still expressed fears that a wider introduction of the scheme would make people lazy. Yet even in the face of these barriers, CI has continued to gain wider attention.
Above all, these chapters show how what was originally seen as an outrageous idea, espoused by a handful of outsiders, has gradually come to be accepted by a wide range of philosophers, sociologists, political theorists and members of the social policy community. With impressive scholarship, Torry assembles the arguments and research findings by which scoffers and nay-sayers have been converted (or have converted themselves) over the past 40 years.
Finally, he demonstrates that all the major political traditions support goals that would be served by CI – individual enterprise for the New Right, equality and solidarity for Socialists, inclusion for One Nation Conservatives, personal freedom for Liberals, efficiency with justice for Social Democrats, and modernisation for advocates of the Third Way. It could also be introduced in affordable ways. So why is it still marginal to politics in the UK, USA and almost all of Europe?
Although Torry does not say so, the answer seems to be that – with capital in the ascendant over organised labour, and globalisation extending its strategic options – it is the disciplinary role of the state that all political regimes seek to uphold. Instead of improving incentives for work, enterprise and savings, they scrutinise and sanction those with low earning power; instead of enabling family formation, they police parenting; and instead of promoting equality, they divide and rule.
Malcolm Torry’s book shows that the introduction of a CI could be rational, ethical and efficient, if combined with other measures to promote sustainability and the common good. It could also be afforded under several different taxation regimes. Unfortunately, none of this makes it likely to happen, so long as power over societies is exercised for the benefit of the few.
Professor Bill Jordan, Plymouth University
by Yannick Vanderborght | Dec 30, 2013 | Opinion
To briefly outline what is going on in Ukraine, I would say “we have had enough, we want change.” Although I will have to disappoint all those who expect that basic income is a topic for the current Euromaidan protets in Ukraine, this article is about how basic income could help solve the conflict in Ukraine. First I will state my view based on my experience, and then I will suggest how to solve the conflict and how basic income could be a part of this solution.
How it started
Most media all over the world report about the events in Ukraine. They call it a pro-European protest and say it is connected with an association agreement between the European Union and Ukraine. In my opinion, this is not the whole truth because I think it is less about an agreement with the European Union but more about Ukrainians’ desire to be accepted as part of Europe and its community of shared (European) values.
Yes, the protests begun after the Ukrainian president announced a few days before a meeting in Vilnius that he would not sign the mentioned agreement even if the negotiations lasted for years. It is important to know that this agreement also contained a Deep and Comprehensive Free Trade Agreement (DCFTA), and the president said the Ukrainian economy would rather suffer than profit from the DCFTA.
Police tried to disperse protesters (11 December 2013).
A few days after the growing protests, in the early morning of 30 November 2013, special riot police troops used violence to disperse a small group of protesters. Videos of the operation were circulated all over the Internet. As a result, the protests swelled even more and after further clashes with police (in front of the parliament where even reporters were attacked) the main demand of the protesters changed into the resignation of the president and the government because the people had lost all trust in them.
This reaction can be understood as a breach of an unwritten social contract: the people in power can be corrupt, can enrich themselves and can rule with arbitrariness as long as they let others live their lives. But by using force against protesters they crossed the red line. People were afraid this could be the beginning of a police state.
All this, the failed agreement with the EU and the police attack that followed, was the final straw that broke the camel’s back because people were not satisfied with the situation in Ukraine.
New Year Tree in Kiev (December 2013).
The current situation
There are three main levels that help understand the current situation: a political, an economic and a social one. Of course, all these levels influence each other, and can be divided into several sublevels including the different versions of Ukrainian history.
Political situation
There is a huge chasm between the population and the political elite. That is why people do not trust institutions or parties. They are not politically apathetic, rather they have the feeling that the political elite does not rule for the population, which has no influence on this.
On the domestic political level, “families” (oligarchs) pull strings in their interests. Politics is often understood as a business in which investments must pay off. Thus, politics is closely tied to economic interests and is seldom connected to people’s will.
It seems to me that on the global political level various powers are trying to pull Ukraine in different directions. Here geostrategic, historical or economic considerations could play a role, but they are seldom consideration for the Ukrainian population.
Economic situation
No exaggeration, the state is facing a default. The IMF offered a program on the condition that the government increases natural gas prices for households. The government refused to fulfil these conditions because this would have also led to protests.
The unemployment rate is difficult to estimate because in some regions of the country a subsistence economy exists. And official salaries do not show the real income situation because people avoid taxes as they do not trust the state and its expenses. This makes it difficult to estimate the real economic potential of Ukraine.
In western and central Ukraine the main economy is agriculture; in eastern Ukraine the iron and steel industries dominate. Some companies are still part of the production chains that were established in the USSR, and their industrial facilities are often outdated and ailing.
Social situation
Barricade on a way to Maidan (17 December 2013).
Corruption is a huge problem and it is, as I call it, “institutionalised.” I mean, on the one hand, if you want to get a lucrative position (e.g. as a border official), you need to pay money to get there; on the other hand, bribes are distributed (e.g. a traffic policeman stops a car and gets a bribe and he pays a part to his boss who pays again to his boss and so on).
In the education sector, marks can be “bought,” and in the medical sector, which is free according to the constitution, you often have to give a bribe to get medical treatment. A similar situation exists in the judicial system and in courts.
Pensions are low, and the social safety net is weak. It’s hard to survive without the support of family members or friends.
Experience of the Orange Revolution (2004)
Foreign media often report that the country is deeply divided and that there is a risk of civil war. This is attributed to different languages in the regions. I doubt that this is true because even Ukrainians whose native language is Russian feel that they are Ukrainian citizens. After the Orange Revolution of 2004 there have been attempts to unite the nation around a common language. In my opinion, this does not work. Rather a nation-building process should be based on common values.
Another experience I had during the Orange Revolution: people were ready for change and there was an atmosphere of departure. But the longer they had the feeling that nothing changed for them, the more they got back into their old rut and their “revolution-energy” fizzled out.
Nevertheless, the society has changed over the years. Gradually, a fragile middle class has developed. However, during the rule of the incumbent president the middle class feels more and more threatened.
Impressions of the Euromaidan’s daily life
Maidan means “place” in Persian. It is the main place in Kiev, which is also known as Independence Square, and it is where the protests are taking place. Some public buildings (e.g. the Town Hall and the Trade Unions House) have been occupied and are being used for “the management of the revolution.”
Tents have been pitched to give people from all over Ukraine additional space to sleep. Even people from all over the world are present or support the people on the Maidan.
The atmosphere is peaceful and full of solidarity. The Maidan is mostly self-organized – partly by veterans with their experience in wars. People share and donate food, clothes and money. Cafes, bars and restaurants are open to everyone who needs to warm up and take a break from the “revolution.”
Webcam picture of Maidan in Kiev (29 December 2013).
The barricades, which the protesters built to protect them from possible police attacks, seem to be archaic. There is a stage, where bands play and other events take place (e.g. Euromaidan University), including programs. The place creates a surreal impression.
Webcams have been installed and an Internet station sends reports from journalists on the spot, with background information, rumours and interviews with experts. The “revolution” is broadcast live on the Internet.
However, when asked what they think about the future, people become silent because they are aware of the problems.
A way out
Ukraine would not be facing a default, if people were paying their taxes and those in power were not using public funds for their own needs. It is about honesty and transparency in the tax system. And the often quoted “gas-question” affects mostly the industry because Ukraine has enough own natural gas for the population. Hence, Ukraine has no real economic problem. If one takes into account the grain harvest and other commodities, Ukraine is a rich country.
In the political sphere there are proposals to change the constitution from a presidential democracy to a parliamentary one. Of course, this step could help change the technical aspects of the young democracy, but it would not have any noticeable influence on the daily life of the people.
In my opinion and from my experience in Ukraine, the most important thing for the country now is to keep this “spirit of revolution” alive by a vision. People have to see and feel improvements.
The big question is how to create such a vision and who should be responsible for its realisation? An answer to the last question could be found in the demands of the people on the Maidan: resignation of the president and government and new elections. And an answer to the first question could be found in Ukraine’s prospect of becoming an EU member. However, taking into account the situation in some EU member states (e.g. Rumania, Italy, Spain, France… where recently protests have also been taking place), I doubt that it is the best vision.
In my opinion, Ukraine should make an inventory of the problems, how they are seen by the people from all regions of the country, including ideas as to how they can be solved. Additionally, there should be an inventory of the economy, in order to understand what works, what is ineffective and what is needed.
Georgia and Poland are good examples of how one can fight corruption. And the experience of other countries could help Ukraine deal with its problems in almost any area. Ukrainians are clever enough to solve their problems, if they are allowed to.
And what about basic income?
I spoke with people in Ukraine about basic income, and the reactions were different.
A taxi driver who drove me once to the border spoke about the difference between Soviet times and now. “In Soviet times we had empty shelves in the stores but money; today, we have full shelves, but not enough money to buy what is offered,” he said.
Left wing groups did not like the idea because they felt people would become dependent on the state and would not rebel against it, if they did not agree with its decisions. But they affirmed the idea of an egalitarian society, in which people should have equal opportunities. I also heard the usual objections (e.g. who would work if there received regular payments), as they are known in discussions all over the world.
When Marina Weisband from the German Pirate Party (she is of Ukrainian origin) visited the Ukrainian Pirate Party in Ukraine, basic income was also a topic. However, the participants in the meeting said that before considering such an option Ukraine had to solve other problems.
Once I had the opportunity to speak with the local director of the World Bank in Ukraine, and to my surprise he knew about basic income. But he rejected the idea because he could see no way in which it could work in practice.
I also spoke with the Brazilian ambassador in Kiev when we wanted to invite him to speak at a symposium about the Brazilian law on basic income. Unfortunately, he had no time to come, but he told us that sooner or later basic income would have to be introduced.
Some time ago, I found out that in Soviet time, seemingly as a reaction to the civil rights movement in the USA, basic income was discussed under the name of a “guaranteed minimum.” Thus, basic income is not an entirely new idea here.
I also know a Ukrainian philosopher who supports the idea. He invited us several times to his radio show on basic income (I made an interview with him, which I later published in my blog).
I also had the opportunity to talk with the top-managers of international companies and they were not against the idea. They said it was politicians, rather than them, who should deal with such issues. They also said that politicians would reject the idea for fear of losing power.
Based on this experience, I think, basic income could be a part of the mentioned vision. And, unlike communism, it is a concrete and practical idea. Some materials on basic income have already been translated into Ukrainian and Russian.
And what about the interfering powers?
All these “families” should be aware that their wealth is based on the prosperity of the population, too. From my experience, I think, Ukrainians do not begrudge others their wealth, if they are allowed to live their own lives (cf. the above mentioned “unwritten social contract”).
And regarding all these foreign powers, it has to be said that Ukraine is actually a sovereign state. It could go its own way and act as a bridge from Europe. What is happening now on the Euromaidan is the question of values, such as justice, equality and freedom. And in my opinion, the European Union, which triggered all these events, should also remember these values. If this happens, the Euromaidan will really earn its name – the European Maidan of Independence.
For further reading on the Ukrainian revolution:
Understanding the Outrage in Ukraine
https://knowledge.wharton.upenn.edu/article/understanding-outrage-ukraine/
Opinion: Birth of a nation:
https://www.kyivpost.com/opinion/op-ed/birth-of-a-nation-333459.html
Sociologists have published the portrait of Euromaidan:
https://maidan.in.ua/sociologists-have-published-the-portrait-of-euromaidan/
