Rightful Share
A basic income is not a silver bullet but definitely a way forward
We have to see that the “economy” is not a stable or inert system but instead bound in politics, assumptions and relations of power. Historically, the study of the economy rested in political economy – fought between the heavyweights of Karl Marx, Adam Smith and others. They did not call themselves economists, but political economists, understanding that all studies of economic systems were political and bounded in power.
Somewhere along the line, about the time of the introduction of neoclassical economics, we swallowed the pill that the economy is synonymous with capitalism and that this is a rational and central fact in all matters of development.
In doing so, we have forgotten that the ‘economy’ is highly political. It is a choice made about who wins and who loses.
Through the neoliberal process, the state has become entwined with the interests of capital, severely undermining its ability to “represent the people or the environment”. What this has meant is that the rights (both economic and civil) of the average citizen have been severely depreciated. The poor have been thrown under the bus completely.
The government does not respond to the needs of its citizens, let alone the needs of ecological systems.
Instead, it serves the interests of the rich and anyone else that will help them stay in power. To them, the rest of us can get stuffed.
We need to disrupt the systems that wage war on the poor. One way to do this is to unlink economic security with having a job and to challenge who owns the wealth generated. Currently we see that wealth is concentrated in the hands of a few elites (and increasingly so). A 2017 report by Oxfam showed that the top 20% of people in Australia have five times more income than the bottom 20%, and hold 71 times more wealth. This accumulation by the rich has been aided by corporate welfare under the guise of “trickle-down economics” (the neoliberal policies outlined above).
Yet the trickle-down never happened.
The rich kept most of it, throwing spare change at us through sporadic philanthropy and donations. Australia’s two richest billionaires are wealthier than the bottom 20% of the population combined. Most of the elites do not work and largely have the ability to get their money through family inheritance and rentier incomes (like a landlord who sits back and waits for their renters to pay up).
A key part of challenging this insecurity and inequality is to demystify the notion that these elite individuals create this wealth all themselves and so they deserve it all.
Let me explain why this isn’t so.
First, the value that is captured by the rich – is created socially – by us all. Commodities and services that are core to capitalism’s ability to accumulate are of value because we make them so. We make particular items economically relevant for accumulation by creating meaning that they are valuable.
Take the iPhone for example. It is an assemblage of metals and matter linked together. What makes it over AU$1,000 dollars to buy is not because it costs AU$1,000 dollars to make – the poor labour conditions and remuneration of those making iPhone have been documented at length.
The phone’s value that Apple gets rich on comes from each of us that reproduce and produce its social value. In us thinking it is a must have item, we make it valuable.
We do the work to make iPhone important things to have, making them profitable for Apple.
AFL is another example.
It is profitable because of all the millions of people that adore and value the game. We make AFL valuable through our love for it – not because kicking and hand passing a ball around is intrinsically valuable in its own right.
There is social labour that goes into reproducing its value that we all do, but doesn’t get remunerated.
Facebook is the ultimate example of how companies and the rich free ride on our labour – our work in producing data for their platform has made it the place for advertising. Through all our unpaid work such as liking, posting, messaging – we made Facebook valuable.
But only Zuckerberg and his shareholders got rich. When we really start to think about this, it is worth asking: why can we not put value into things that actually matter?
Things like caring for each other and the ecological world around us?
The second reason as to why we should challenge the assumption that the rich deserve the wealth they hold is because the wealth captured by elites is generated by the free use of public goods we all pay for. We pay taxes for the roads and ports they use to truck and ship their goods around. We pay for the public (and private) education system supplying innovation. We pay for the public health system that keeps our bodies alive to keep working for the rich. We pay to maintain the legal system that upholds their ability to accumulate. And so on.
The third reason is because much of the wealth captured by elites is accumulated off the backs of those labouring in Australia or elsewhere. However, increasingly, we are seeing through processes of financialisation and automation, that labour is not even necessary for this accumulation to take place. Unless we find different ways to distribute economic security, things will get worse.
It is the poor being treated like shit today, but when unemployment and underemployment further catches up, it will be the rest of us.
The key to this is that instead of seeing extreme wealth as something belongs to individuals, we need to see wealth as something we all contribute to and to which we are entitled to a share of.
This is what anthropologist James Ferguson has called a rightful share.
In his book “Give a Man a Fish”, Ferguson asks:
“What if a poor person could receive a distributive payment neither as a reciprocal exchange for labour (wages) or good conduct (the premise of conditional welfare) nor as an unreciprocated gift (assistance, charity, a helping hand), but instead as a share, a rightful allocation due to a rightful owner [i]?”
This approach moves us towards seeing the distribution of wealth as a way to make sure everyone gets their inheritance that we all socially generate.
The most widely discussed mechanism of a rightful share is a basic income. A Basic Income (BI) is a simple idea: a periodic cash payment unconditionally delivered to all on an individual basis, without means-test or work requirement[ii]. A BI as a rightful share is vastly different to what many technophiles and elites propose which seem to view BI as a mechanism to keep us from destitution without radically redistributing their wealth in order to keep their status quo as owners of production and our freedom. The rightful share BI helps avoid this, as it demands radical redistribution by challenging the whole concept of who deserves wealth[iii]. We get a BI because it is rightfully ours – a dividend for being part of society.
A BI as a rightful share allows for radical inclusion in society and in doing so, would create real freedom for all peoples– freedom from exploitation and rising economic insecurity, and freedom to live a life people actually want.
It could also keep people from having to go down exploitative avenues that keep vulnerable people in insecure situations, such as avoiding dangerous or exploitative labour conditions.
A rightful share goes beyond just cash too. It also raises the challenge for a redistribution of other kinds of social goods, including education, land, housing and healthcare. Therefore, a BI is never a silver bullet, but needs to accompany many other important measures – redistributive tax reform, shorter working hours, housing, universal healthcare and education, and increasing union’s bargaining powers – just to name a few.
A BI may even destabilise the Australian obsession with labour, which also adds to social and economic exclusion.
[i] Ferguson, Give a Man a Fish: Reflections on the New Politics of Distribution, 178.
[ii] BIEN, "Basic Income Earth Network," http://www.basicincome.org
[iii] There are many debates about the implementation of a basic income. I would recommend the chapters in Elise Klein, Jenni Mays, and Tim Dunlop, Implementing a Basic Income in Australia: Pathways Forward, ed. Elise Klein, Jenni Mays, and Tim Dunlop (London: Palgrave Macmillan, 2019).Here a few points around the major misconceptions of a basic income drawn from the chapters in this book. Basic Income is much more than what the right has espoused. It is true that UBI has had resonance across the political spectrum. Milton Friedman wanted to replace the welfare state with giving people vouchers so people could pay for what they needed. This view of UBI is dangerous as it is deeply commodifying and there is no guarantee that a subsistence wage would cover the cost of items like medical treatment and education. It also fails to engage with notions of unfreedom inherent in capitalism – something also overlooked in the proposals coming from Silicon Valley elites and friends. Instead, we need to understand UBI as a radical redistributive mechanism – one that works to redistribute wealth so all can enjoy economic security as a basic human right. We must see the UBI not as a grant, but a social dividend from wealth collectively created, or what Stanford’s Professor James Ferguson calls a rightful share. A UBI as a rightful share would go along side other social services like heath, education, housing and disability support.
A UBI won’t stop people from working. Some critics of UBI have argued that UBI disincentivises work. But a UBI of $15,000 or $20,000 a year is not going to lead a mass exodus from the labour force in Australia. People will still be able to work if they are lucky enough to find a job. There is evidence for this: the 1960s and 70s Negative Income Tax trials in North America showed only a small decrease in labour market supply. The people delayed in returning were mainly women re-entering the workforce after having children or young people staying longer in education. For those in paid work, a UBI gives an unconditional economic base that improves workers bargaining power. A UBI means if people want to withdraw or suspend their labour from exploitative or oppressive conditions, they can without the fear of destitution. This is important as the GIG economy, labour precariarity, and attacks of collectively mobilised labour and unions are increasing. The UBI gives people the freedom to say no to get a better deal for their labour.
However the fixation on how a UBI will effect labour market demand is short sighted - the availability of formal and dignified employment is dramatically eroding, and there simply aren’t enough secure and dignified jobs for everyone. Also, formal work as it is currently defined is very limited. It overlooks all the productive unpaid labour that people do – from the reproductive work (mainly women) do in raising children, to the important work some First Nations people undertake in caring for country and the unpaid creative work carried our by our artists.
UBI isn’t utopian and implementation is possible. There are different ideas about how to implement a UBI. John Quiggin from the University of Queensland outlines a ‘stepping stone’ approach where either basic or universal is preferenced first in the implementation process (and the other added over time). For example, a universal focus (before basic) means implementation will begin with a small universal payment for everyone, the amount gradually increasing over time to the point where it becomes sufficient to meet basic needs. A Basic (over universal) implementation starts with one group (such as young people) who are first given the full BI, and other groups are added to this over time to make it Universal – an approach preferred by Quiggin and outlined by Troy Henderson (University of Sydney) and Ben Spies-Butcher (Macquarie University).
The Basic Income is expensive but not too expensive. Some of the calculations floating around about how much a UBI will cost are misleading. The error here is that the cost of UBI is presented as the gross cost (i.e., the size of the proposed basic income multiplied by the population size), rather than its true net cost (i.e., the proposed size of the basic income multiplied by the number of net beneficiaries, without counting the net contributors paid through redistributive tax). The UBI is not a stand a lone measure as it interacts with the tax system to redistribute wealth. Also, the cost would be eased in over time if the UBI were implemented in the staged ‘Basic’ approach.
A UBI isn’t a silver bullet. The UBI is not a panacea and needs to accompany many other important measures – dignified employment creation, redistributive tax reform, shorter working hours, housing, universal healthcare and education, and increasing union’s bargaining powers… just to name a few.
October 2020