Basic Income as a Neoliberal Weapon

  • A large poster in a square in Geneva, Switzerland, promoting the idea of a universal basic income
    A large poster in a square in Geneva, Switzerland, promoting the idea of a universal basic income | Photo: Reuters
There are a wide range of notions of what a BI system might look like. Devotees of free market capitalism have their own vision.

In April of this year, the Ontario government is expected to release details of a pilot project that will study the effects of a very limited and rather dubious attempt at Basic Income or BI. As with similar experiments in Finland and the Netherlands, nothing approaching a universal payment will be put in place. Rather, a sampling of the poorest people will be provided with a very modest allowance, with fewer bureaucratic strings attached than under existing systems of income support.

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These experiments are really focused on the impacts that the measures will have on the people being tested, with a major focus on to what extent “labor market participation,” which really means readiness to take low paying jobs, is enhanced. In truth, it’s really poor people who are being evaluated and not a system of BI. For that to happen, the impact of introducing the measure on a massive scale would have to be assessed. The results for the people being tested are probably quite predictable. If those in poverty are given an increased payment with less intrusion into their lives, we may expect that they will be somewhat better off. The real issue is what kind of a BI would be implemented across an entire political jurisdiction and what impacts would such a measure how on society as a whole.

There are a wide range of notions of what a BI system might look like. Devotees of free market capitalism have their own vision. The right wing U.S. political scientist, Charles Murray, advocates a meager universal payment and stresses vehemently that this must replace entirely the other elements of social provision. The liberal to radical left supporters of a progressive BI counter with models that are anything from modestly redistributive to radically transformative, some even dreaming of a universal and very adequate payment that would rob capitalism of any capacity to economically coerce workers. The problem with all of these plans is that, despite thoroughly good intentions, they fail to address the actual practical possibilities of their being implemented. It is just assumed that fairness and social justice can be introduced by way of a social policy initiative.

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Before we consider the prospects for a BI that would improve lives and reduce poverty, we should examine the factors that have shaped existing systems of income support. If we go back to the roots and consider the English Poor Laws, we see a peasantry being driven off the land in the 1500s and forced to enter a newly created job market. An oversupply of labor served the interests of the employers of the day but total abandonment of the unemployed led to dangerous levels of social unrest. The solution the State came up with was a system of provision that might enable people to survive but that was as inadequate as possible so as to continue to drive people into the lowest paying jobs. Modern systems of welfare and social assistance have continued with this approach and are marked by meager payments and bureaucratic intrusion into peoples’ lives.

As the neoliberal agenda took root and intensified and, as employers sought to lower wages and increase the rate of exploitation, a systematic degrading of income support systems was carried out in all countries that had the elements of a welfare state in place. This led to a scramble for the worst jobs and an explosion of low wage and precarious employment. From the standpoint of the architects of neoliberalism, this has been an enormously successful and profitable strategy. Yet the advocates of a progressive BI imagine that all this can be put behind us simply by somehow convincing governments to adopt a social policy that will make everything rational and fair. They don’t ask themselves why the neoliberal powerbrokers would give up decades of gains by providing income adequacy and, in doing so, increase workers’ bargaining power massively. They don’t ask how, with our unions and movements significantly weakened by the neoliberal attack, we could force the employers and the state to make such a vast concession.

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The danger of not dealing with such issues lies in the above-mentioned right-wing version of BI. When the exploiters and enablers who gather at Davos consider the policy, they realize that it has enormous possibilities for them. With a whole progressive lobby laying down a welcome mat, they can now work on very different brand of BI. A meager and dwindling payment can be provided that in no way interferes with the flow of workers into the low-wage sector. Moreover, if they extend the payment to the working poor, it becomes a de facto wage top-up for employers. The struggle for living wages is now undercut. The most exploitative employers know that their workers are being paid out of the tax revenues and they are under little pressure to raise wages. Governments can freeze of even lower minimum wages and a general lowering of wages sets in.

At the same time as neoliberal BI is used to grease the wheels of super-exploitation, another key element of the neoliberal agenda, privatization, is facilitated. The BI payment, as free market advocates have long suggested, is given in place of the other elements of social provision. As public healthcare, social housing and much else beside are gutted, BI transforms those who receive it into “customers” shopping through the privatized rubble of the social infrastructure. It is, of course, quite possible to design on paper a BI model that is adequate and that does not involve cutbacks in other areas but the question is which version is more likely, based on prevailing economic and political agendas and the present balance of forces in society.

Rather than trust to the Davos crowd and hope “the 1%” develops a taste for social justice, a far better approach would be to build the social movements and struggles that can defend past gains and work for expanded and accessible public services. Rather than hope neoliberal governments will offer us a social policy end-run around austerity, far better to press for income support systems that offer full entitlement, adequate payments and that are no longer based on bureaucratic intrusion and moral policing.

Basic Income is a false hope and a pathway to the commodification of social provision that, while it may be paved with good intentions, leads to a destination entirely to the liking of those who design and operate the neoliberal order.


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