Basic Income in the Hands of the Liberal Party

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Both the Federal Government and the Wynne Regime in Ontario have been making noises of late about the notion of introducing a system of Basic Income. The Provincial Budget even suggests that a pilot project will be set in motion in a community to be determined. Clearly, a significant development in the area of social policy is possible and we must ask ourselves how we should view this.

At first glance, especially as the impact of austerity and social cutbacks throws ever more people into poverty, the idea that everyone should be guaranteed a certain minimum level of income that lifts them out of poverty is enormously appealing. If that was all we were considering here, the matter would be very clear cut and Basic Income would have our unqualified support. Sadly, however, things are less straightforward and the issue raises some alarm bells. In this regard, there are several questions to consider.

The first point to make is that any Basic Income system that was actually put in place would not be designed by poor people and their allies but by governments acting in the interests of banks and major companies. When we speak of such a system, we may have very decent notions of how it might be designed and delivered but, sadly, the concept of a Basic Income, previously referred to as a Guaranteed Annual Income (GAI), has long been promoted by leading representatives of the political right. None other than Milton Friedman, the economist who contributed so much to the development of a neoliberal agenda internationally, supported a GAI. As recently as 2006, arch US conservative, Charles Murray, was peddling the idea. Why would such people advocate a minimum level of income?

Essentially, the right favours a form of Basic Income because it represents a floor and the one they want to put in place is in the basement. Friedman understood that a minimum payment could be used to destroy relatively adequate social programs by folding them into the new system. Those who have followed in his footsteps are attracted to the idea of a payment to low wage workers that will form part of their income and allow employers to pay even lower wages. Right wing advocates have also grasped the possibilities of a ‘simplified’ arrangement that dismantles much of the edifice of social provision and replaces present delivery systems and the workers who deliver them, with privatized services. There is a very well thought out notion of
Basic Income that is fully in line with the directions of the present austerity agenda.

Those who put forward a notion of a progressive, poverty alleviating Basic Income, sometimes fall into the trap of seeing the concept as one that is so rational and fair that everyone in society will want to get behind it once they appreciate its potential benefits. However, the reality is that governments have not spent decades undermining income support programs and making people poorer on the basis of any misunderstanding. The turn to a neoliberal approach in the 1970s included, as a major strategic objective, the undermining of programs like unemployment insurance and social assistance so as to push ever greater numbers into the lowest paying jobs and to assist the drive to depress wages. Since the emergence of post 2008 hyper austerity, this objective has been promoted even more energetically. The results in Ontario have been dreadful. Since 2003, the share of workers at minimum wage in the Province has more than doubled. At the same time, the spending power of social assistance payments has fallen by at least 55%. The climate of desperation that is created by reducing the adequacy of income support systems is central to the proliferation of low wage, precarious work. For Trudeau or Wynne to reverse this direction and create a program of secure Basic Income that seriously reduced levels of poverty, would mean that they would be setting themselves at odds with the prevailing international agenda of austerity. To describe this as highly unlikely would be a very optimistic view of things. The conclusion is, therefore, inescapable that, if Basic Income is being considered by the Liberals, it is with a view to deepening, rather than reversing, the attack on income adequacy.

In the context of Ontario, there is another dangerous side to this question. For more than a decade, Liberal Governments in this Province have increased levels of poverty while maintaining an ongoing circus of ‘poverty reduction’ consultations. Round after round of these hideous proceedings have gone back and forth across Ontario under several different guises. Basic Income threatens to give this duplicitous operation a new lease on life. As people sink deeper into poverty, the Wynne Government will be only too glad to hear from the community on a bold new vision of income provision it fully intends to disregard. We must not be drawn into another round of meaningless dialogue at a time when community action to confront growing poverty is so urgently needed.

Basic Income is a concept to view with skepticism and Liberal plans around it should be regarded with deep suspicion, at the very least. More than anything else, we need to understand that the austerity driven effort to push down wages and gut the social infrastructure can’t be reversed by an attack of rationality and fairness. We are still going to have to mobilize in our unions and communities to defeat it.