As people start to grasp the power of a currency issuer thoughts lead to the idea of a universal basic income. Rejections against it are based on ‘not wanting to give money to millionaires’. Then there are those that advocate for a basic income. An income for people that choose not to work.
The first step in understanding why currency has ‘value’ (why we use it) is because of the coercive nature our governments use demanding the currency they issue back in taxes. In order of operations a tax liability comes first, then the spending, then the taxes.
In helping to understand that concept I use the story of ‘the hut tax’. When the British colonised Malawi, to create labourers they needed a mechanism to coerce the locals into needing to accept the colonisers currency. They placed a hut tax on the dwellings and if the tax wasn’t paid they were removed by force. (source) There are other examples of tax liabilities to drive a currency. The colony of New South Wales had liquor licensing to quell the unruly behaviour that stemmed from the production of spirits (the rum trade) In 1824 an act was set up introducing the ‘Spanish dollar’ as a currency and liquor licensing brought in to drive its acceptance. note: the early colony didn’t have a means to mint their own coins. Spanish pesos with holes drilled through the middle were used.
The first reason why I disagree with basic incomes, universal or otherwise, is it undermines the coercive nature of the tax liability. This is a contrived example but it is to emphasis a point. Imagine a society where most people chose to remain on a basic income but we are short of nurses. What coercive mechanism would we use to drive people off basic income into work. The payment of an unconditional income after the tax liability undermines the reason for the tax liability in the first place. That is an error many people make.
The second reason is that ‘work’ however defined is intrinsic to our own identity.
When we try to formulate the psychological effects of unemployment, we lose the full, poignant, emotional feeling that this word brings to people.Eisenberg, P., & Lazarsfeld, P. F. (1938). The psychological effects of unemployment. Psychological Bulletin, 35(6), 358–390. https://doi.org/10.1037/h0063426
The study cited above is from 1938. I chose that study to demonstrate that the effects of unemployment have been studied for quite a while now. The paper discusses unemployment leading to an increased instability and lowering an individuals moral. We create social networks through work, use it to develop and improve skills and create a sense of purpose for ourselves. Not only in terms of a self-identity but through social networks we develop and the sense of contributing to something bigger than ourselves. There are also issues with respect to children and youth growing up in unemployed households. You witness lower self-esteem and declining grades amongst children in unemployed households and of course poverty as a result of insufficient income.
Another point basic income advocates miss is the idea we need to redefine the definition of productive work. The definition of what constitutes productive work was part of the debates happening around the 1930s. It was deemed anyone working and creating a profit was ‘productive’.
Overtime we’ve advocated for social services and provisioning of education, healthcare and utilities to be provided as public goods. This is often seen as a ‘cost’ to society under flawed framing of ‘tax and spend’. Though we would say that workers in those sectors are productive. However, overall ‘work’ as we define it today is viewed as needing to be earning a profit or it is otherwise ‘subsidised’ by taxes.
Work can be defined as something much broader. We can include parenting, the arts, cultural and indigenous knowledge, community work. The list is endless. Basic income advocates use arguments that ‘someone should be allowed to create and develop their art’ and I am all for that. Though there is an idea of reciprocity. We could develop a Job Guarantee where someone can choose a job to develop their artistic skills, undertake courses and provide work of community benefit. They may be required to assist in designing the artwork for a community festival and working with others to discuss ideas and theory. Art isn’t created in a vacuum. There is a social context and artworks often reflect social upheavals and social movements from the era they were created.
Work is about giving back
I chuckle at the idea that if someone chooses not to work we should support them in that endeavour. There are various migrant communities were work is essential in terms of defining their place within their communities and contributing to the survival of those community.
I am a generation removed from subsistence living. My grandparents with their children grew up in a rural village with no electricity. They produced most produce themselves. They would make the bricks to build their houses, locals (usually family) taught in the school and each family took turns in producing various agricultural products. Fruit trees, vegetables, chickens, goats, cheese, olives were all part of the mix.
My grandmother tells me her street, which was made up of her brothers, would take turns in milking the goats to make the cheese. One week it was her turn and it would move up and down the street until it came back to her house. Imagine within that setting you refused to make a contribution. You would be ostracised by the community and not allowed to share in the rest of the produce that was grown.
The basic income undermines the coercive nature of the tax liability that is implemented to create workers in the first instance. That is just a technical fact.
Work is responsible for more than just an income. It allows for social mobility, a setting that allows personal and skill development, it gives us a social standing within our communities, it assist in the development of social networks, and allows for children to grow up in households were they see value in what their parents create in a broader community. This stuff is immeasurable.
There is an idea of reciprocity. I find it difficult to comprehend that someone that expects a high level of social services and public goods feels that they can choose to opt-out of work and be provided with a subsistence living. That wouldn’t fly in a small rural village and I don’t see why it is a valid argument in our modern societies.
The idea should be to redefine productive work and include things that have public purpose and enhance our communities making them better places to live.
If you demand a high level of public services and want our government to ensure enough work for all the other end of that bargain is contributing to your potential to make our communities desirable places to live.