Living Income Guaranteed as the Capitalist’s Answer to
a Healthy and Wealthy Economy
Any economist is familiar with Keynes and
the Keynesian economic model of a demand-driven economy. Keynes understood that
money requires to move for an economy to thrive, in the same way that blood
must flow for a body to be healthy.
An economy can be broken down into three
basic flows: Spending, production and income – spending requires to happen for
companies to be able to produce goods – the production of these goods then
provides income to the employees of the companies that produced them. There is
thus an undeniable link between spending and income. When too few people have
adequate income, or when income is too low – too little is spent, too little is
produced – and income reduces even more.
The ideal way to ensure spending is
therefore to secure everyone with an Income.
Furthermore – capitalism can only work if
Equal Opportunity of Participation exists. Unless Equal Opportunity exists,
capitalism becomes a system of exclusion and deprivation – because Capitalism
only ensures efficient production and distribution of resources for those with
an income. Therefore – to prevent Capitalism from becoming a weapon, but instead,
an actual management system as how it was intended to be – each individual
should have a guaranteed income.
Furthermore – an economy will not only
thrive through money movement, BIG pilot projects have shown that more children
attend school, and thus, one will have a more qualified labor force in the
future – increasing the intellectual capital in an economy.
A Guaranteed Living Income is a Human Right
Regardless of the economic arguments,
guaranteed income is a basic human right. To speak of Basic Human Rights
without securing the means through which to benefit from these rights, is
useless.
The Equal Life Foundation therefore suggest
that the Living Income one receives should be sufficient to be able to enjoy
one’s Basic Human Rights, and thus, large enough for individuals and families
to live a decent human life – meaning: one can live off a Living Income Guaranteed
with dignity. This implies the ability to pay for one’s basic needs such as
electricity, water, food and clothing – but also extends to the means to
participate in our current society and thus includes things such as a car, a
phone/cell phone and internet access.
Social Dividends
To fund a Living Income Guaranteed – a system of
social dividends is ideal. In every country there are those goods and services
that are vital for the basic well-being of the citizens of that country.
Examples are basic resources such as water, electricity, raw materials,
transportation and media. Such goods and services do not belong in private
hands – but belong to each individual of the nation. Therefore – every citizen
should be a shareholder of every company involved in the production of such
goods and services.
This is not a new idea – as early as 1935,
G.D.H. Cole, wrote the following:
“How will ... incomes be distributed? There
are two possible ways - payments for work done, and 'doles', or, to give them a
less coloured name, 'social dividends'. I believe the system of distribution
will be a combination of these two, but a very different combination from that which
now exists. ... There will remain, broadly, two sources of income - work and
citizenship. Incomes will be distributed partly as rewards for work, and partly
as direct payments from the State to every citizen as 'social dividends' - a
recognition of each citizen's claim as a consumer to share in the common
heritage of productive power.” (Cole 1935, pp. 234-235)
The dividends one receives from the profits
of these nationally owned companies then form the Living Income Guaranteed. With each
one being a shareholder, each one immediately also has an equal say in the
activities of such companies – which is an application of direct democracy in
the areas of life that are most important, which again solidifies and protects
each one’s Basic Human Rights.
Incentive to Work
The inevitable question then comes up: If
everyone receives an income that covers one’s needs – who will be willing to
work?
This is where the Equal Life Foundation
suggests an interesting solution. To provide incentive – the minimum wage
should be double the Living Income. This means that anyone who has a job
can not only fulfill one’s needs, but can enhance one’s quality of life through
acquiring luxury items that would not be available on a Living Income
budget. One can then afford a bigger house, a larger family, a second car, a
bigger garden, more exotic and fulfilling holiday destinations, subscriptions
to sports clubs and other leisure organizations, and so on and so forth.
Consequentially - as soon as one has a job
– and thus, receives a wage that is at least double the income one would have
earned from social dividends – one’s right to the Living Income Guaranteed falls away
– simply because one doesn’t require it anymore. The social dividends system
then functions as a National Insurance system – combining unemployment fund,
life insurance and retirement funds all in one – where, one receives a pay-out
based on the applicability to one’ situation.
Also read:
Day 415: Bailouts Are No Solution
Sources:
COLE, G.D.H. 1935. Principles of Economic
Planning. London: Macmillan & Co., 1935.
