It isn’t the banks, Wall Street, the Federal Reserve, politicians, cheap labor or deal-making that make our economy go. We have a consumer-driven economy which won’t grow if wages don’t grow, and median wages have been stuck at about $500 a week for the last 15 years. Global capital moves jobs toward the lowest labor costs. Technology is compounding the loss of jobs and full-time employment. We produce more than we can consume, and there is no longer a good job for everyone who wants one and is qualified.
There has been a worldwide explosion of interest in Basic Income Guarantee (BIG), but you will also see flavors of it referred to as Guaranteed Minimum Income, Universal Basic Income, Citizens Dividend and other similar titles.
The idea is that every citizen receives a sum of money each year, in addition to their income from other sources. Citizens receive the money without condition. The amount of money is set at a level that will allow for the necessities of living, without frills. (Click here to read Part I.)
In one swoop, it replaces bureaucratic social services programs while teaching personal responsibility, so conservative thinkers around the world are latching on to the idea. At the same time, everyone is assured of some way of surviving with some kind of dignity and security.
In the 1940s, Milton Friedman, later the economic guru to Ronald Reagan and Margaret Thatcher, proposed a version of it as a replacement for existing government assistance programs. Richard Nixon pushed a version of it targeted toward families with dependent children through the House of Representatives in 1970 (the “Family Assistance Plan”). Nixon’s 1972 Democratic opponent, George McGovern, advocated his own Guaranteed Annual Income plan that would have included all families.
Dr. Martin Luther King passionately advocated a guaranteed income for all Americans in his last book. By that time, he had transformed from an advocate of civil rights into an advocate for economic and political justice, a change which cost him his popularity. Writing in 1967 as if he were writing in 2015, King demonstrated an understanding of our modern economy that exceeds that of every current presidential candidate. He recognized that no matter how much statistical “growth” there is in the economy, it will not eliminate poverty or provide jobs for everyone. He once said,
“We must create full employment or we must create incomes. People must be made consumers by one method or the other.”
The main criticism of BIG is that if you pay people for being alive they will lose the incentive to work. Wrong. Most people, at the very least for the sake of their children, will want to work to achieve a lifestyle above subsistence levels. This has been tested in controlled experiments. Human incentive is a funny thing. Most people want to be productive, want to contribute, want to develop themselves.
Since 1982, Alaska has paid its citizens each year out of state oil revenues (typically $1,000 to $2,000). People still work in Alaska.
The Dutch city of Utrecht is conducting a large experiment in which individuals will receive just over $1,000 a month instead of welfare (couples receive up to about $1,500). Already seven other Dutch cities are thinking about trying it. The Netherlands has the highest proportion of part-time workers in Europe (46.1 percent).
In 2016, the Swiss will be voting on a national guaranteed basic income referendum (equivalent to $16 per hour for full-time work). Political parties in at least 26 countries, including Canada and 15 countries in Europe, have some version of a basic income guarantee in their platform.
Job losses will only get worse. Our political system will not stand up to the forces that make this so. To preserve anything like the America in which most of us grew up, basic income may be the logical step forward.
Michael Miller (firstname.lastname@example.org) has worked in state and local government. He lives in New Hyde Park.