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Socialist Project • E-Bulletin No. 1065
January 6, 2015

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An Unconditional Citizen's Income

Ursula Huws

In these straitened times, the idea of a basic income, granted unconditionally to every citizen, from cradle to grave, feels utopian. How on earth could it be paid for, we wonder. Wouldn't everyone just stop working? Where would we be then?

I first came across it, in the optimistic late 1960s, in a form that materialized in the so-called ‘fifth demand’ of the Women's Liberation movement (formulated in 1971) that called for ‘financial and legal independence’ for all women. This had an enormous appeal: not only is it degrading for anyone to have to beg or manipulate someone else for their means of subsistence, and materially damaging to that person if the money is not forthcoming; it also destroys the character of human relationships if they are embedded in relations of dependency. Unequal power relations like those between a husband and a dependent wife, parents and dependent teenagers, able-bodied providers and their disabled dependents can lead to a festering mess of guilt, gratitude and unexpressed anger. The results can range from dishonesty and depression to emotional and physical abuse. In a money-based society, an independent source of income is a pre-condition for human dignity.

Before going any further I should declare my personal position on this question. I have written intermittently about the idea of a basic minimum income since the 1990s, and would class myself as broadly in favour of the principle, though with some important reservations. In the 1990s I wrote a report[1] on the subject for the Citizen's Income Trust (CIT), the UK affiliate of the Basic Income Earth Network (BIEN), but then backed away from it for a while, for reasons that I will spell out later (under ‘risks’). Since then I have come back to the idea and am now (albeit not as active as I should be, and with some reservations I will come on to) a trustee of CIT. But I am writing here in a personal capacity and my opinions do not necessarily reflect the CIT's position.

Keeping Body and Soul Together

What I have written below is based on the assumption that a benefit would be paid unconditionally to all citizens, regardless of age, replacing most existing welfare benefits but also the personal tax allowance (at present, the first £10,000 of income for each person is disregarded for income tax, providing a ‘benefit’ of £2,000 per person in tax not paid at 20%). Whilst each person would receive the benefit, therefore, they would also pay tax on all income. The level of the benefit, the rate of tax, and the degree to which that tax is graduated would of course be political decisions and I am not going to make detailed proposals here. But my assumption is that the level of benefit would be enough to keep body and soul together and take care of basic needs but not more.

The Advantages

  • It would save the state a huge amount of money, currently spent on processing claims and policing benefit claimants and would eliminate the need for many of the present complex array of benefits (child benefit, sickness benefit, pensions, maternity benefits etc.).
  • Because children would be eligible for it, as well as adults, it would be broadly redistributive toward households with children and thus help to alleviate the shockingly high levels of child poverty in this country.
  • Because there is no household unit of assessment it might well encourage people to live more collectively, sharing resources with friends and extended families, which would also have environmental benefits and take some pressure off the housing market.
  • It would enhance inter-generational solidarity.
  • It would make it possible for people to change their working hours flexibly and combine more than one job much more easily than at present.
  • Life would become much smoother and simpler for freelancers.
  • It would make it much easier to manage illnesses and disabilities and juggle caring responsibilities with work.
  • It would also make it much easier to move in and out of education.
  • The judgement about what is, or is not ‘work’ would no longer be made by a bureaucratic authority but by the individual. If you want to live on very little and devote your life to art, music, prayer, blogging, archaeology, chasing an elusive scientific concept, conserving rare plants or charitable work, that would be your choice. This is not just good for those individuals but spiritually enriching for society as a whole.
  • The labour market would become a little less one-sided. Employers might have to offer a bit more pay to entice people into unattractive jobs. Though, on the other hand, they might find people queuing up to fill the ones that offer high levels of personal satisfaction and reward.

The Risks

  • Giving everybody money plays along with the grain of an increasingly market-based economy. The risk is that individual purchases made in the market will drive out collectively-provided services. Recommodification might obliterate decommodification.
  • Globalization raises serious questions about what constitutes citizenship. It is perhaps no accident, at least in Europe, that the countries with the most generous welfare states also tend to have the most tightly-controlled borders (think of Denmark). Combining a basic citizen's income policy with non-racist immigration policies presents some serious challenges.

Conclusion

Although, in my opinion, it would bring huge benefits, an unconditional citizen's income is not a magic solution to all political, social and economic problems. I believe that it could be one ingredient in the development of a kind of welfare state that is deserving of the name. However it is only one ingredient among several. In particular, it would have to be combined with:

  • an increased minimum wage;
  • increased investment in universally available public services that are free to the user, including health, childcare, education and social care;
  • a recognition that the housing market is so distorted that continuing extra help will be required to house the poorest people in many parts of the country;
  • a reformed tax system. •

Ursula Huws is Director of Analytica Social and Economic Research; Editor, Work Organisation, Labour and Globalisation; Professor of Labour and Globalisation, University of Hertfordshire, and maintains a blog at ursulahuws.wordpress.com where this article first appeared.

Endnotes:

1. Ursula Huws (1997) Flexibility and Security: Towards a new European balance, London: Citizen's Income Trust.

Comments

#6 Anonymous 2015-01-07 12:33 EDT

if you go to www.citizensincome.org you will see links to some fully-costed proposals that demonstrate that a CI could be introduced in the UK without leaving anyone worse off, though in some models the level of CI is set differently for different age groups.



#5 john s. 2015-01-06 23:50 EDT
paying for it
Simple, use wages to fund it. Didn't Marx say that the final emancipation of the working class is the ultimate abolition of the wages system?

Take a portion (or all) the money currently paid in wages and put it into a general fund to be distributed as an unconditional citizen's income. Of course there would be many difficult details and problems of transition. But, that's where to get the money from.



#4 Anonymous 2015-01-06 16:04 EDT
Two more benefits of a basic income guarantee
This is a marvelously succinct statement of the benefits and risks of a basic income guarantee. I suggest adding to the list these benefits:

* a basic income guarantee enables high school students who so wish to stay in school rather than having to leave for financial reasons. This, along with a significant reduction in health care costs, was a demonstrated effect of the 3 to 4 year Mincome experiment in Dauphin, Manitoba in the 1970's;

* it would enable unions to decide to strike when essential more freely and allow them to maintain strike actions beyond the time period limited strike funds can support.



#3 Anonymous 2015-01-06 13:55 EDT

Let's go further and develop the idea of income curbs. There should be both a minimum and maximum income applicable to all citizens. The maximum income is just as vital for promoting egalitarianism - and therefore socialism itself.

With regard to taxes, let us look beyond them. The traditional socialist plank of nationalizing large scale enterprises, together with the maximum income curb (100% taxation of income above the limit), should provide governments with all the revenue they need. Income within the curbs should be tax-free, a policy which should garner attention and public support for the overall socialist agenda.

Additionally, the socialist agenda properly includes establishing national banks. These would replace the private banking cartel and the dreadful, debt-based central banking system which essentially privatizes the creation of all currency. Such socialist banking and currency reform would further free governments from dependency on taxes, as money would be created debt-free as a public asset.

So, then, the issue of guaranteed income should be integral to the socialist program and not even open to debate.



#2 B. Currie 2015-01-06 12:07 EDT
Enlightened Constitution
We need much more than a minimum wage. Our Canadian Constitution should include a list of expectations that must be reached. Failure should have real consequences.

Canada's New and Enlightened Constitution

We are a nation of people who believe their can be no political democracy without economic democracy.
To this end; all Canadians shall be grated full right to:
(a) Universal medical care.
(b) Universal access to education.
(c) Clean air, food and water.
(d) A minimum standard of shelter.
(e) An expectation of a narrowing of wealth disparity.
(f) An expectation that the government decisions shall be guided by fairness and justice and not influenced by wealth.
(g) An expectation that the government will work to a negotiated peaceful solution before resorting to war.
(h) An expectation that Canada’s electoral system shall be fair.
(i) An expectation that all members of parliament shall tell the truth.

Canada shall establish a “Human Development Programme” similar to the United Nation's. A minimum index of expectations, based on Canada's recourses, worker skills and Gross Domestic Product shall be presented to each newly elected government.
A progress report shall be posted on the Human Development website. If after four years, the minimum index of expectation is not reached, none of the sitting members of the governing party shall be eligible to be on the ballet in the next election.



#1 D. Mario Nuti 2015-01-06 04:46 EDT
Fine, but who is going to pay for it?
The advantages of a basic income scheme are unquestionable, the risks you mention are well understood and manageable. But you neglect a major crucial question, namely who would pay for the scheme, in these times of universal austerity and especially in countries that are already heavily indebted and subject to tight fiscal discipline by the European Union.

James Meade endorsed a basic income but envisaged that before introducing it a country would run cumulative budget surpluses that over the years would repay national debt and then build up a net public capital whose revenue would finance the scheme. If this is what you have in mind it would take centuries in most countries. Meade was disappointed that during their transition to a market economy the post-socialist transition of Central-Eastern Europe did not use their net public capital in this way but frittered it away in unprecedented rounds of mass privatization through the distribution of free vouchers to the population.

Unless you have a better practical proposal for funding a basic income, you need to go back to the drawing board.



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