Imagine for a moment that tomorrow, or some rosy morning in the distant future, Centrelink and everything it stands for is energetically dismantled and replaced with a $3000 monthly cheque given to every Australian on the basis that they’re a) a citizen and b) alive.
Many would consider this a glorious pipedream come true. With the state footing rent, food and bills, working suddenly becomes very optional. Sillier than a bumful of smarties? The idea is not as loopy as it sounds and it’s closer to reality than you may think.
Guaranteed basic income – the idea that governments should ensure unconditionally that no one’s income falls below a certain level – has gained significant momentum from political and activist movements in Europe. Switzerland is the latest in the EU to take the idea seriously – it will decide later this year whether or not to enact a ‘basic income’ that would entitle every citizen to a 2500 franc ($3400 AUD) guaranteed monthly stipend.
It seems a pretty radical idea, though it’s not a new one. Guaranteed income sprung up regularly on policy tables in the late 60s and early 1970s. Uniquely, it tends to appeal to both sides of the political spectrum. Liberal activists, like Martin Luther King saw it as the key to ending poverty; conservative gurus like granddaddy of the free market, Milton Friedman admired its ability to shrink resource-heavy social programs into a single, streamlined welfare transfer.
In Australia, 2.5 million people live below the poverty line (14% of the population; on par with the US). The Atlantic suggests that a basic income would cut that rate in half overnight. British economist Guy Standing argues that, as well as addressing poverty, basic income is about social justice – a tool for emancipation, a way to give people real control and power over their own lives. Doing away with a patrician welfare system built on means-tested hoop jumping would help remove the stigma of disadvantage, while returning trust and dignity at the individual level.
Late Australian economist-futurist Robert Theobald was an early maverick of the idea. His 1963 book Free Men and Free Markets argued that a minimum income would give people the choice and right to ‘opt out’ of the consumption race – to do what they thought was meaningful, rather than what the market dictated. It would free up time and energy; those who wanted to return to study and enhance their prospects could do so; those who wished spend time to care for loved ones, or focus on creative or artistic pursuits could go for it without the anxiety attached to making ends meet.
The idea looks pretty neat on paper, but how would it turn out in the real world?
Between 1974 and 1979, every resident of the Canadian township of Dauphin, Manitoba received a basic ‘mincome’ to supplement low wages and keep every family above the poverty line. As well as overwhelmingly positive reports of general wellbeing and quality of life throughout the community, poverty was eliminated; high school graduation rates rose and mental illness hospitalisation became virtually non-existent.
“Liberal activists, like Martin Luther King saw it as the key to ending poverty”
Sounds like a mini-utopia. Yet many wonder how a basic income would actually incentivise people to work at all. A common fear is that if no one actually needed to show up in the morning the economy’s rear would blow out – beaches would swamp with idle freeloaders; garbage would pile in great stinking mounds beneath metro stations like Naples in the summer of 2008.
Given a no strings attached cheque it’s fair to presume that many would ‘opt out’ for low cost leisure and kicks. But as Anne Lowery of the New York Times points out, “the basic income might be enough to live on, but not enough to live very well on.” Seeking more than the minimum, most people would likely keep on trucking as normal, if not a little less – such was the case in Dauphin, except for a few mothers who wanted to spend a little more time with their newborns.
Another major qualm is cost – who foots the bill? Dishing out a cheque to all and sundry is bound to wreak havoc on a government budget. Researchers at Queensland University of Technology suggest redirecting revenue from overhauled welfare programs and tax generated from income could cover the damage, as well as removing tax allowances to high income earners. Most international models follow this line; some European movements propose higher tax on luxury goods, and streamlining national value-added or consumption taxes. Critics argue that these measures wouldn’t come close to closing the gap.
It’s worth considering at this point that we live in a world where more and more is being produced by less of us. Economist Paul Mason highlights that the disappearance of work itself could be the most critical justification for a basic income.
Mechanisation has led to a productivity explosion, but it’s also responsible for the impending global jobs crisis – researchers at the Oxford Martin School predict that 47% of US jobs are in danger of being lost to automation in the next two decades. The right to work will soon be unachievable for hundreds of millions of people, while millions that do have work stagnate in what anthropologist David Graeber calls “bullshit jobs”:
Huge swathes of people, in Europe and North America in particular, spend their entire working lives performing tasks they secretly believe do not really need to be performed. The moral and spiritual damage that comes from this situation is profound. It is a scar across our collective soul.
It is thought that basic income would shake up the labour market – alleviating the ‘need’ to work, freeing up roles for those who do want to work, giving those in low paid jobs more bargaining power, while stimulating growth in order to avoid a crisis of under-consumption amidst over-production.
Ultimately, this is a debate that taps deep into the very nature of work, and how we ought to think about it in a rapidly transforming era. Co-founder of the Basic Income Initiative, Enno Schmidt (whose film essay helped spawn the present movement in the EU), hopes the Switzerland referendum will help shift the whole mentality around work – ‘untangling’ work from income, while challenging the notion that the only way to contribute to society is by holding down a job.
Whether it’s the right to laziness or the right to survival, basic income is a compelling idea. It’s no magic bullet and it’s unlikely to take hold overnight, if at all. Still, Canada and Ireland have been considering it; pilot programs are underway in Brazil, India and Namibia; America is debating it heartily; and, though far from enough to be live on, Alaska already doles out a yearly stipend to its citizens from oil revenue.
And in Australia? We have the wealth to do it. It’s really a question of political will. Meanwhile, in the absence of any other long-term policy platform to combat our escalating poverty and unemployment, economic insecurity continues to be a reality for many. The million dollar Centrelink heptagram remains a lone beacon – the single half-rainbow leading anywhere remotely close to a fair and decent pot of gold for all.