Wednesday, April 05, 2017

Citizens Wage

 Old fallacies that were debunked years ago are resurrected and presented as new and profound truths.  One being circulated around as the panacea for poverty and all the accompanying social ills is the Universal Basic Income (UBI) or Citizen's Wage. UBI is an unconditional pay packet for everyone in the country. It replaces all existing benefits and is granted to people no matter their job, wealth or circumstance. It will not make you rich, but provide you with the means to survive. Such schemes were first suggested as far back as the 1930s and the ILP but actually goes as far back as the Speenhamland system in the Middle Ages. The first Muslim caliph, Abu Bakr (573-634 CE), who introduced a guaranteed minimum standard of income, granting each man, woman, and child ten dirhams annually; this was later increased to twenty dirhams. Thomas Paine advocated a citizen's dividend to all US citizens as compensation for "loss of his or her natural inheritance, by the introduction of the system of landed property" (Agrarian Justice, 1795). While Napoleon Bonaparte echoed Paine's sentiments and commented that 'man is entitled by birthright to a share of the Earth's produce sufficient to fill the needs of his existence'. Nevertheless, no country has actually implemented such a system nationally.

On the right UBI in some shape or form has now a solid base amongst its neo-liberal advocates (such as Hayek) who hope to use it to abolish the provision of any state provision of social services and just give every citizen a small equal cash handout instead. It is clear why the UBI concept is most popular on the libertarian right - a means to deismantle the Welfare State. universal unlimited welfare provision. 

Many Left proponents assume that if the government gives everybody, working or not, a regular income this is going to have no effect on wage levels? They seem to be assuming that this would be in addition to income from work whereas what is likely to happen is that it would exert a huge downward pressure on wages and that over time real wages would on average fall by the amount of the "basic" income. In other words, that it would be essentially a subsidy to employers. It would be "basic" in the sense of being a mimimum income that employers would top up to the level people needed to be able to reproduce and maintain their particular working skill. Don't they understand how their much-vaunted law of supply and demand works?

These radical supporters of a Universal Basic Income want to end capitalism while presupposing its continued existence. If people are free from any compulsion to work for a capitalist company, this would destroy the capitalist mode of production. This, after all, relies on the workers to produce the products which are turned into profits. It also relies on the exclusion of workers from these products so that they can become profits. However, at the same time, the same supporters also ask the same capitalist firms to produce the profits to pay for freedom from them in the form of a Universal Basic Income. They want both: the continued existence — for now — of the capitalist mode of production where the reproduction of each and everyone is subjugated to profit and the end of this subjugation by providing everyone with what they need. They want companies to make profits, which relies on and produces the poverty of workers, while at the same time ending mass poverty. They want to maintain the exclusion from social wealth through the institution of private property and end this exclusion by giving everyone enough money.

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