by Andre Coelho | Feb 26, 2019 | News
Elizabeth Warren. Picture credit to: Vox
Childcare in America is amongst the highest in the world. For typical middle-class families (two working parents with two children), it sits at just about 30% of the family’s earnings, according to an OECD study which places it as the 5th more expensive in the world. For low-income single parents the result is even more severe, with childcare cost representing about 32% of the earnings, and pushing the USA to the second most expensive country in the world (only supplanted by Ireland). That seems to be related with the lack of state support for childcare (as opposed to that of the UK, for instance, where this last population bracket may get refunded for up to 85% of their childcare costs), joined with staggering rises in prices for these services, which have risen 1000 % in 30 years.
Despite this grim scenario for working parents, especially those on low incomes in the USA, childcare has not often been on the political agenda. Republican dominated governments have always been contrary to large federal spending programs, and Democrats initiatives along the years (e.g.: Obama, Bernie Sanders, Hillary Clinton) have gotten little attention, both from media and voters. However, the issue is regaining traction among Democratic leaders, and Elizabeth Warren’s initiative to go for universal child care (UCC), as part of her presidential candidacy agenda for 2020, is getting some media attention.
The policy is set to guarantee that no family gets to spend more than 7% (official Department of Health and Human Services figure for what is considered “affordable”) of their income on childcare. If implemented, the policy will also exempt families earning less than twice the poverty line from paying any related childcare cost. Of course, this represents a large increase in governmental spending, estimated in 700 billion $ in 10 years, and Warren proposes to tax it from the super-rich. This new tax represents a 2% levy on fortunes worth at least 50 million $, and a 3% on those surpassing 1 billion $. According to economic consultants (Emmanuel Saez and Gabriel Zucman, former Thomas Piketty collaborators) working with Warren, this new tax could generate 2,75 trillion $ in the same 10-year period.
The universality of the proposed policy is an important feature of it, even though it is tied to childcare alone. On the other hand, and unlike a basic income type of policy, it is given as a subsidy for children care centres, as a cap on costs at 7% would be installed for parents. So, all parents (and their children) would potentially benefit from it, depending on the percentage that their childcare costs represent on their total income. In other words, Warren’s idea is not to boost citizen’s earnings, and create a secure financial floor under which they cannot go – as a basic income would do – but to universally reduce childcare costs for all families, capping those costs as a percentage of their earnings.
More information at:
Reality Check Team, “Childcare: Do UK parents pay the most in the world?”, BBC News, February 13th 2018
Sarah Kliff, “Elizabeth Warren’s universal child care plan, explained”, Vox, February 22nd 2019
Matthew Yglesias, “Elizabeth Warren’s proposed tax on enormous fortunes, explained”, Vox, February 24th, 2019
Mark Zandi and Sophia Koropeckyj, “Universal Child Care and Early Learning Act: Helping Families and the Economy”, Moody’s Analytics, February 2019
by Andre Coelho | Feb 22, 2019 | News
Alexandria Ocasio-Cortez. Picture credit to: The Cut.
Alexandria Ocasio-Cortez (AOC) tabled a Resolution on the United States House of Representatives (H.RES.109) which hinted, in a first version, that “the Green New Deal would take care of people who are “unwilling to work””. That last bit of the sentence started a political hurricane in the United States. In that country, work is seen as tightly linked to jobs, and jobs are conceived as essential to value, and so “unwilling to work” is simply understood as “lazy”. Period. So, taking care of the lazy just sounds nonsensical to most Americans.
Because most people and politicians in the United States equate “unwilling” with “lazy”, it’s very difficult to pass on the message that “unwilling” might actually mean unwilling to perform a certain job/task that can be revolting, disgusting, unfair, tedious, repetitive and/or badly paid. Rigid work ethics and years of living in an economic crisis has also helped to lower people’s expectations, and be more open to exploitation. What is at dispute, at bottom, is the nature of work.
On the aftermath of those three words having been read on an official document, AOC was showered by a rain of criticism, particularly from Republicans, while being left isolated by colleague Democrats. Everybody fled, including AOC and her assessors. In an attempt to clear the record, AOC team tried to link it to the GOP, then alleged the release was a draft version. On the “final” version of the 109’th Resolution, cited above, indeed no reference is made to “unwilling to work”, or “unwilling” anywhere. Also, the reference to “basic income programs”, which was a part of a draft text for the Green New Deal that had already hit the news (for more positive reasons) was eliminated. So now, the creation of a Green New Deal, as proposed by AOC and some of her team and fellow Democrats, is completely devoid of references to basic income and unconditionality, while referring only to “universal access to clean water” and “universal access to healthy food”. And, on the H) paragraph of the 4th chapter, one can read the more fundamental and still core Democrats value as far as work is concerned: “guaranteeing a job with a family-sustaining wage, adequate family and medical leave, paid vacations, and retirement security to all people of the United States”. What remains to be seen is how AOC and other supportive Democrats envision achieving these universal rights – e.g.: access to clean water, healthy food and a decent income – without actually implementing a basic income in the country.
Basic income supporters / activists say, however, that the unwillingness to work is one of the reasons basic income should exist. American philosophy professor and author Karl Widerquist says it eloquently: “This idea that somehow people who are unwilling to work are bad or lazy is a horrible idea. Because whenever there’s a job offer and somebody doesn’t want it, what you have is a dispute about wages and working conditions”. Andrew Yang, the American presidential candidate who is running his campaign on the basic income concept, said that, in fact, the language (“unwilling to work”) “is unfortunate. It does make it easier to try and portrait [UBI] as extreme”. Widerquist added that “It’s really horrific to use the threat of poverty and homelessness as a work incentive”, qualifying that as “monstrous”. However, it seems, the monstrosity hasn’t been enough to break the bond most Americans hold dear, between wealth and work.
Senator Chris Murphy, on this issue, has stated that, although he thinks basic income is not sellable to the American public right now, the discussion about it should start today, because, to him, it will become a necessity in “decades” from now. In other countries, though, far away from the US geographically, economically and culturally, such as India, not only that debate has been going on for decades, but recent developments indicate that implementation of a basic income type of policy is on the verge of becoming a reality.
More information at:
André Coelho, “United States: Democrats add basic income to a climate change addressing plan”, Basic Income News, December 9th 2018
Paul McLeod, “Alexandria Ocasio-Cortez Got Dragged For Suggesting People Who Are “Unwilling To Work” Should Get Paid. Advocates Say That’s The Point”, BuzzFeed News, February 15th 2019
by Andre Coelho | Feb 6, 2019 | News
The 18th annual North American Basic Income Guarantee (NABIG) Congress will be held next June 15-16th, 2019, at the Silberman School of Social Work of the Hunter College in New York City. The Congress Major Theme is: Basic Income on the Policy Agenda, and the call is out for proposals. The deadline for proposal submissions is February 18th, 2019.
Submissions can be made here.
Fifty years after a basic income bill was first introduced in the U.S. Congress, basic income is once again on the policy agenda in North America. Pilot programs, controlled trials, documentaries, and debates are bringing basic income into mainstream policy conversations. The 2019 NABIG Congress invites participants to consider how to advance basic income on the policy agenda at local, national, and regional levels.
More information at USBIG’s website.
by Andre Coelho | Jan 29, 2019 | News
“The answer is blowing in the wind”. Picture credit to: BBC News.
It’s official. Twenty-seven Nobel Laureate economists, four former chairs of the Federal Reserve, fifteen former chairs of the Council of Economic Advisers and two former secretaries of the US Department of Treasury now agree: a carbon-tax must exist, and its dividends should be distributed back to all US citizens. It is relevant to say that most of these co-signatories are ‘former’ actors of these important economic institutions, which may leave an open question mark on whether the present officials at these institutions also corroborate their support for this basic income-like carbon taxation policy.
According to long-time basic income advocate and researcher Philippe van Parijs, “this amounts to the endorsement of the Paine argument for basic income by a remarkable congregation of US top economists of all colors”. That would be granting a basic income as a right of existence to each citizen, in this case for sharing the Earth’s atmosphere; hence the right to live in a clean, climate change-free version of it – at least while there are anthropogenic carbon emissions being dispersed into the atmosphere.
The “Economists’ Statement on Carbon Dividends” is written in the form of a short list; short enough to be replicated here:
Global climate change is a serious problem calling for immediate national action. Guided by sound economic principles, we are united in the following policy recommendations.
I. A carbon tax offers the most cost-effective lever to reduce carbon emissions at the scale and speed that is necessary. By correcting a well-known market failure, a carbon tax will send a powerful price signal that harnesses the invisible hand of the marketplace to steer economic actors towards a low-carbon future.
II. A carbon tax should increase every year until emissions reductions goals are met and be revenue neutral to avoid debates over the size of government. A consistently rising carbon price will encourage technological innovation and large-scale infrastructure development. It will also accelerate the diffusion of carbon-efficient goods and services.
III. A sufficiently robust and gradually rising carbon tax will replace the need for various carbon regulations that are less efficient. Substituting a price signal for cumbersome regulations will promote economic growth and provide the regulatory certainty companies need for long-term investment in clean-energy alternatives.
IV. To prevent carbon leakage and to protect U.S. competitiveness, a border carbon adjustment system should be established. This system would enhance the competitiveness of American firms that are more energy-efficient than their global competitors. It would also create an incentive for other nations to adopt similar carbon pricing.
V. To maximize the fairness and political viability of a rising carbon tax, all the revenue should be returned directly to U.S. citizens through equal lump-sum rebates. The majority of American families, including the most vulnerable, will benefit financially by receiving more in “carbon dividends” than they pay in increased energy prices.
It may also be relevant to acknowledge that “economic growth” and “competitiveness of American firms” can be read as central in this statement, which might leave another question mark on whether these top economists and advisers would still support a related policy if it, by any chance, didn’t involve these iconic aspects of modern-day capitalist economy. Also interesting is the reference to “cumbersome regulations”, which should be scrapped, and of the acceleration and “diffusion of carbon-efficient goods and services”. This also sounds reminiscent of a contemporary known driver of orthodox, 21st century economic theory: green growth.
Guy Standing, another long-time defender of the basic income policy, writing from Davos, where the world’s richest discuss money and politics at the highest level, has said that he considers this Economists’ Statement as “a major move toward basic income”, adding that he “even had agreement from Larry Fink on one panel debate.” This could indeed be very relevant, since Fink is one of the richest people alive today and therefore his net contribution to a basic income-like policy is, potentially, very large. Other participants at Davos, such as Martin Wolf from the Financial Times, have expressed more cautious approaches to this radical proposal, having said, “I have not been in favor, but I would not be against it, if it were introduced”. This could arguably be the equivalent of saying if a basic income were introduced, he would not reject the payment, but would not support it, either.
The complete co-signatory list for the Economists’ Statement on Carbon Dividends can be read here.
Article reviewed by Dawn Howard.
by Andre Coelho | Jan 23, 2019 | News
Alexandria Ocasio-Cortez cartoon. Picture credit to: Folding Hamster.
Alexandria Ocasio-Cortez (AOC) “keeps kicking ass”, as put by Nathan Robinson, editor-in-chief of the Current Affairs magazine. Unlike other young left-wing politicians in the past, who end up conforming and moderating their views on important political issues, according to (Democratic) Party Elders’ advices, AOC keeps a sharp edge, which has already won her the name “radical”. Instead of falling into meekness or fright, she has actually embraced the nickname, by stating that “I think that it only has ever been radicals that have changed this country.” And she gives examples: Abraham Lincoln with the Emancipation Proclamation signature, Franklin Roosevelt with the first Social Security program. Among others, for sure.
According to some, then, AOC has been pushing nothing but “radical” ideas, ever since she was elected as an MP in Congress, last November. She starred the presentation of a Resolution which outlined the very ambitious “Green New Deal”, allowing the United States to meet its environmental duties as far as energy use and production are concerned. Using that same document, she has been also advocating for nothing less than the end of gender and class divisions in the American society, along with the abolition of poverty. Moreover, she has mentioned that the pursuit of basic income will probably be a part of a real progressive agenda for the country.
Not happy with that, and because “she doesn’t take crap”, AOC went on to defend that taxes should be raised to as much as 70% for the ultra-rich. Naturally that this proposal was met with horror by many right-wing politicians, but it seems that, actually, the proposal is sensible and is backed by 59% of Americans (recent poll by The Hill-HarrisX). This apparently “radical” proposal is also supported by mainstream economists like Paul Krugman, plus a surprising 45% of Republicans (71% of Democrats support it). AOC hasn’t found these survey results surprising, since she recognizes that “What we see, overall, is that the vast majority of Americans know that income inequality is one of the biggest issues of our time”. This fair tax hike would, according to Washington Post’s Jeff Stein, be enough to cover for Bernie Sanders’ public college plan, erase over half or deeply alleviate student debt in the US, get Barack Obama’s plan to offer universal prekindergarten off the shelf…or a very modest unconditional income of 280 US$/year for every adult citizen in the country.
On a final note, AOC has also shown to master online communication, which really helps her message coming through and, most importantly, get discussions going. Using Trump’s favorite online toy, Twitter, her comments have generated more monthly interactions (11,8 million) than the sum of three of the most popular Democratic senators Kamala Harris, Bernie Sanders and Elizabeth Warren, which is also more online interaction than the largest American corporate media outlets…combined.
More information at:
Nathan J. Robinson, “How AOC is changing the game”, Current Affairs, January 14th 2019
Jessica Corbett, “Call Me a Radical’: Ocasio-Cortez Suggests 70% Tax Rate for Ultra Rich to Help Pay for Green New Deal”, Common Dreams, January 4th 2019
André Coelho, “United States: Democrats add basic income to a climate change addressing plan”, Basic Income News, December 9th 2018
André Coelho, “United States: Alexandria Ocasio-Cortez mentions basic income at a Netroots Nation event”, Basic Income News, December 29th 2018
Jake Johnson, “As Poll Shows Majority Back 70% Tax Rate for Ultra-Rich, Ocasio-Cortez’s “Radical” Proposal Proves Extremely Mainstream”, Common Dreams, January 15th 2019
Jeff Stein, “Ocasio-Cortez wants higher taxes on very rich Americans. Here’s how much money that could raise”, The Washington Post, January 5th 2019
Jake Johnson, “As Congresswoman ‘Keeps Kicking Ass’ on Social Media, Ocasio-Cortez Rejects Idea ‘Some Subjects Too Complex for Everyday People’”, Common Dreams, January 14th 2019
