USBIG NEWSLETTER VOL. 4 NO. 20, MARCH-APRIL 2003

This is the Newsletter of USBIG, (http://www.usbig.net) a network promoting the discussion of the basic income guarantee (BIG) in the United States--a policy that would unconditionally guarantee a subsistence-level income for everyone. If you'd like to be added to or removed from this list please email: Karl@Widerquist.com.

TABLE OF CONTENTS:

1. THE SECOND USBIG CONGRESS AND GENERAL MEETING

2. WORKING CONFERENCE ON ECONOMIC SECURITY FOR CANADIANS

3. BIG DISCUSSION AROUND THE WORLD

4. CONFERENCE: FISCAL CRISIS THROUGH THE LENS OF CLASS

5. NEW PUBLICATIONS

6. NEW DISCUSSION PAPERS

7. NEW LINKS

8. LINKS AND OTHER INFO

1. THE SECOND USBIG CONGRESS AND GENERAL MEETING

Seventy people attended the Second USBIG Congress in New York on March 21-23. It was held in conjunction with the Eastern Economic Association’s annual meeting. Thirty presentations touched on issues as diverse as the ethics of the basic income guarantee and empirical issues of introducing BIG in the US, Europe, and South Africa. Participants included scholars of many disciplines, students, activists, politicians, and others. Brazilian Senator Eduardo discussed Lula’s Zero Hunger Program as a step toward a basic income guarantee in Brazil. Activists, such as Theresa Funicello and Steve Shafarman discussed how to build an effective movement for BIG in the United States. Joel Handler, Philip Harvey, and Amy Wax debated the relative merits of a guaranteed income versus a guaranteed job.

The All-News Channel in the Bronx (Channel 12) did a 2 1/2 minute segment on the USBIG Conference. They opened by interviewing two welfare mothers, and explained what BIG was. They showed 10-seconds of their interview with Al Sheahen (USBIG’s new publicity chief), and quizzed Bronx Congressman Jose Serrano on what he thought of the idea. Serrano said Republicans would vote against it. They closed with the studio announcer saying Nixon had introduced the idea 30 years ago, passing in the House but dying in the Senate.

The USBIG Network held its second general meeting on at the Congress on February 23, 2003, in New York City. The meeting discussed several issues—among them we assessed our performance so far. When USBIG was founded at the Kiev Diner in December 1999, it took on only one goal: to increase discussion of the basic income guarantee in the United States. Since then, subscription to the USBIG Newsletter has grown from 25 to 360 people. The discussion paper series has released 62 discussion papers. USBIG has organized two conferences out of which will come a book, a journal symposium, a special issue of a journal, and numerous individual articles and book chapters. The book, tentatively titled, “The Ethics and Economics of the Basic Income Guarantee,” is under negotiation with a major academic publisher, and more news on it will be available soon. The conferences have been extremely interdisciplinary and have brought together diverse participants from inside and outside the academic community. Therefore, we concluded that USBIG has had substantial success in working toward its first goal. But much more work needs to be done, and we resolved to continue to pursue the goal of increasing discussion of this issue, and not to take on any major new goals this year.

The USBIG Network resolved to hold yearly Congresses, and to try to widen participation in the next conference both by appealing to academics of more varied disciplines and by giving nonacademics more opportunities to participate. Next Year’s Congress will again be held in conjunction with the Eastern Economics Association, this time in Washington, DC at the Hyatt Regency on Capitol Hill, February 20 - 22.

The meeting created a new public relations committee headed by Allan Sheahen (alsheahen@prodigy.net), and including Almaz Zelleke and Stephan C. Clark. No changes in the make-up of the coordinating committee were discussed. Its members are Karl Widerquist, Michael Lewis, Eri Noguchi, Robert Harris, and Fred Block. The USBIG Network will continue with its informal structure for the next year, but we will create a system for formal membership, which will be announced within the next six months.

The following people attended the 2003 organizational meeting of USBIG:

STEPHEN C. CLARK, primary school teacher, author of “Jasper’s Box”

HARRY F. DAHMS, sociologist, Florida State University

BUFORD FARRIS, sociologist, University of St. Louis

THERESA FUNICIELLO, leader of Social Agenda, author of “The Tyranny of Kindness”

ROBERT HARRIS, economic consultant, former vice president of the Urban Institute

Michael Lewis, sociologist, SUNY School of Social Welfare at Stony Brook

WOLFGANG MUNDSTEIN, New Yorker

BRADLEY NELSON, undergraduate student, University of Connecticut

JOSE LUIS REY PEREZ, Lawyer and doctoral candidate in Philosophy of Law and Human Rights, Universidad Pontificia Comillas of Madrid

STEVE SHAFARMAN, activist, author of “Healing Politics”

ALLAN SHEAHEN, author of “The Guaranteed Income”

JEFFERY J. SMITH, editor, the Geonomist

EDUARDO SUPLICY, member of the Brazilian Senate

KARL WIDERQUIST, economist, doctoral candidate in politics, Oxford

ALMAZ ZALLEKE, New School University

2. WORKING CONFERENCE ON STRATEGIES TO ENSURE ECONOMIC SECURITY FOR ALL CANADIANS

The Basic Income/Canada network and the Canadian Council on Social Development co-hosted a working conference on economic security for Canadians. It was held in the Informetrica offices in Ottawa on January 31-February 1, 2003. Participants in the conference included academics and economists, income security advocates, members of nonprofit and social policy research organizations, as well as individuals with lived experiences of poverty.

Sally Lerner, of the University of Waterloo, noted that a major challenge lies in how a secure economic foundation can be created for the increasing numbers of “flexible” workers demanded by employers. Ken Battle, of the Caledon Institute, outlined some of the work his organization was engaged in and presented the major findings of a new study on the Minimum Wage. John Anderson, Vice-President, Research CCSD, talked of the work of the CCSD in trying to develop a new social policy architecture inspired by recent work in the voluntary sector. Douglas House, of Memorial University of Newfoundland, presented insights on his extensive work trying to implement a new system of income security in Newfoundland. Derek Hum of the University of Manitoba talked about his work as Research Director of Mincome Manitoba (the Canadian Negative Income Tax Experiment). Mike McCracken of Informetrica detailed proposals for a basic income for each stage of the life cycle. Armine Yalnizyan emphasized the need to develop high quality social programs and the crucial relationship of these to income security. John Stapleton, from St. Christopher’s House in Toronto, and former Ontario government civil servant, gave invaluable insights into the debates around some of the existing programs. Josephine Grey, of the Income Security Advocacy Centre, talked about the “Pay the Rent and Feed the Kids Campaign” in Ontario.

Participants discussed how policies could work across the life cycle; the relationship between economic security and human rights; how to erase the negative stigma of the current welfare system; connecting income security with accessibility to important social programs such as adequate and affordable housing, healthcare (including supplementary health benefits), childcare, post secondary education and training. While many diverse views were represented, all agreed that the current welfare system fails to offer low-income Canadians dignity and the means necessary to have an acceptable quality of life, and that major change is needed. There will be a book on this topic produced by the conference participants.

More information about the conference and its participants can be found by contacting:

Sally Lerner, University of Waterloo, lerner@watserv1.uwaterloo.ca

John Anderson, Canadian Council on Social Development, anderson@ccsd.ca

Information on basic income and economic security is located at the:

Basic Income European Network http://www.basicincome.org

Or, Basic Income / Canada http://www.basicincomecanada.org

3. DISCUSSION OF BIG AROUND THE WORLD

BRITAIN: A new party called the People’s Alliance announced its existence over the internet recently and endorsed a BIG as one of its policies. One item on their list of sixteen stated policies reads, “Eradicating poverty - a universal benefit or guaranteed minimum income payable to every citizen as of right without means-testing. All other benefits to be abolished and one single rate of tax to be paid on all earnings thereafter.” Other items include a written constitution for Britain, electoral reform, extensive use of referendum, and a harsher policy on asylum seekers. The party did not announce who its backers were and some dismissed it as a publicity stunt, but a party spokesperson predicted the party would win seats in upcoming elections in Scotland. The announcement comes the British media continues to discuss a proposal to move to a universal pension system akin to a basic income for the elderly.

For the People’s Alliance’s website go to: http://www.peoples-alliance.org/.

For a BBC article on the launch of the party go to: http://news.bbc.co.uk/2/hi/uk_news/politics/2848523.stm

THE UNITED STATES: Actor Ed Asner (famous for his work on the Mary Tyler Moore show, and for being fired from his own television show for speaking against American policy in El Salvador during the Reagan administration) endorsed BIG in a recent interview with Lisa Marie Lentz. In addition to discussing his recent work for Autism research and for the Democratic Socialists of America, Asner said, "My dream is that everyone would have, at a minimum, a guaranteed income adequate for feeding themselves and their families, health care, shelter, and above all, education.”

SOUTH AFRICA: In late February, South Africa's Finance Minister Trevor Manuel unveiled a range of poverty relief measures in the country's budget for the next financial year which include extending the child support grant, raising pensions and providing for a food relief fund, but he made no mention of the Basic Income Grant proposal. Several groups, including the opposition party Democratic Alliance, criticized the ANC budget for including measures, such as a Basic Income Grant, to aid the unemployed and the poor. The People's Budget Coalition, which consists of the 1.8 million-strong Cosatu, the SA Council of Churches and the SA Non-Governmental Organisations' Coalition, included a BIG in its alternative budget. Because of the alternative budget, BIG was widely discussion in the South African press, but it is unlikely to be added to the ANC’s budget this year. [From reports in the South African Sunday Times, Financial Mail, Business Day, the South African Press Association, and Africa News]

NEW ZEALAND: The Dominion Post of Wellington reported the following story by Chloe Groser under the headline, “Man pushes for income for all” on March 10, 2003, in its national news section on page 7:

A Nelson man is touring the country on a radical mission to get all New Zealanders a universal basic income -- regardless of what they earn. "According to the International Bill of Human Rights, every person has the right to a have a minimum wage level. Right now, New Zealand is way below the level," said Patrick Danahey, an advocate for economic human rights. Mr Danahey, who will run an open forum at Palmerston North's public library on Wednesday, said receiving a universal income was a basic human right. But it was being ignored by governments around the world. He said the income, which would be funded by a system of taxing, would be paid to everybody. It would supplement any incomes they already received, but would be enough for non-earning people to live on. It would be permanent and unconditional. "The key is that we are all bosses of society and we are all equal," he said. "Everybody should be entitled to at least a minimum wage level or an unconditional universal income." If applied the theory, which he said was supported by Nobel laureate in economics Herbert A Simon, would close the gap between rich and poor. The enormous wealth held by a few would be distributed more evenly throughout the world.

Green MP Sue Bradford said the Green Party found the concept of a universal income interesting and supported the idea in principle. "Many of our people are very keen on it and we would like to see the Government fund substantial research into whether it would work in New Zealand." She said she was cautious of the approach that everybody deserved the income. The Green Party's approach was that it would be tied to a commitment to work and the welfare system would be integrated with the tax system. There would need to be radical reform to implement the system, including a very different tax system, she said.

4. CONFERENCE: FISCAL CRISIS THROUGH THE LENS OF CLASS

A conference to help develop a coherent working-class presence in New York City life

March 28-29, 2003

At the City University Graduate Center

365 Fifth Avenue, at 34th Street, Manhattan

Friday night plenary is free and open to the public

Saturday conference fee: $10 / $5 student, retired, unemployed

Working people in New York are facing two burdens: the fiscal crisis, and the absence of a coherent working class politics that can adequately respond to the deep suffering the fiscal crisis will entail. This conference will bring together people from the labor movement - both public and private sector workers - academics, and people from many different community organizations to begin developing strategies and connections that build rather than undermine a united working class response to the fiscal crisis. Our goal is to consider productive ways of responding to corporate and capitalist power while actively shaping the social movements we need to redirect public finances in the interests of working people.

TO REGISTER, Contact:

Continuing Education & Public Programs, CUNY Graduate Center

365 Fifth Avenue, Suite 8204, New York, NY 10016-4309

Tel: 212.817.8215. Email: continuinged@gc.cuny.edu.

For more information visit http://www.workingclass.sunysb.edu.

5. NEW PUBLICATIONS

Thanks to Jeroem Knijff

JOHN CUNLIFFE AND GUIDO ERREYGERS, “‘Basic Income? Basic Capital!’ Origins and Issues of a Debate” in The Journal of Political Philosophy: Volume 11, Number 1, 2003, pages 89-110. This paper traces the development of the basic-income-basic-capital debate from its Eighteenth-Century origins to the modern debate between the debate between Stakeholder Grants as proposed by Ackerman and Alstott and Basic Income as proposed by Van Parijs and others.

DAVID MILLER, "What's Left of the Welfare State?", Social Philosophy and Policy 20/1 (Winter 2003), pp. 108-110, discusses several defenses of the unconditional basic income proposal from Brittan, Van der Veen, and Van Parijs). The same issue also includes an article by J. Carens on socialist equality vs. real-freedom-for-all.

JOHN CREDDY and PETER DAWKINS, “Comparing Tax and Transfer Systems: How Might Incentive Effects Make a Difference?” The Economic Record Vol. 78, No. 1, March 2002, 97-108. This paper uses an economic simulation model to compare the basic income / flat tax system with a means text / graduated tax system. It finds that a basic income system can cause a net increase labor force participation over the other system. These findings do not appear to be sensitive to assumptions about the individuals’ preferences for income and leisure.

6. NEW DISCUSSION PAPERS

No. 55 February 2003

WHAT DEFEATED A NEGATIVE INCOME TAX?: CONSTRUCTING A CAUSAL EXPLANATION OF A POLITICALLY CONTROVERSIAL HISTORICAL EVENT

Leland G. Neuberg, Boston University (neuberg9@bu.edu)

In 1969 the Nixon Administration proposed to reform welfare with a negative income tax (NIT) that made none of those on welfare worse off in income terms. Three years of intense congressional struggle ensued at the end which the Nixon NIT welfare reform died. This paper studies that conflict with the political methodologist's logistic regression models of votes on bills in Congress, and the political historian's analysis of primary and secondary textual sources. Employing the results of its study, the paper constructs a narrative that embeds a causal explanation of the defeat of the Nixon NIT proposal in its story. That narrative focuses on the political ideas of key liberal Senator Fred Harris (D, Oklahoma) because previous narratives have neglected them. The paper concludes with a critique of some of the causal claims embedded in previous narratives of the defeat of the Nixon NIT proposal.

No. 56, February 2003

THE POLITICAL PSYCHOLOGY OF REDISTRIBUTIVE PROGRAMS: WORK & RECIPROCITY

Amy L. Wax, University of Pennsylvania Law School (awax@law.upenn.edu)

In prior work, I have argued that popular attitudes towards social welfare programs and redistributive social policies, as revealed by extensive data gathered through voter surveys, can be explained by widespread adherence to a norm of conditional reciprocity. See Wax, Rethinking Welfare Rights: Reciprocity Norms, Reactive Attitudes and the Political Economy of Welfare Reform, 63 Law & Contemporary Problems 257 (Winter/Spring 2000); A Reciprocal Welfare Program, 8 Virginia Journal of Social Policy and Law 477 (Spring 2001); Something for Nothing: Liberal Justice and Welfare Work Requirements, forthcoming Emory L J. (2002). Under the reciprocity paradigm, persons are deemed entitled to call upon public resources to maintain a decent standard of living in times of need, but only if they have first expended a reasonable effort to contribute to their own support. The reasonableness of the effort depends on the person’s abilities and endowments as well as reigning social practices and conventions.

This paradigm comports with, and has fueled, the recent repeal of the key federal poor relief program, Aid for Families with Dependent Children, and its replacement by the work-based Temporary Assistance for Needy Families. The paradigm spells trouble, however, for plans to reform the federal Social Security program to create a fiscally sound old-age pension system. The reciprocity norm abhors free riding, which is defined as contributing less than one’s fair share to the common pool from which resources are drawn for emergencies. It stigmatizes as freeloaders those able-bodied persons who fail to work or who work less hard than social expectations demand. Although conditional reciprocity is rigid in requiring able-bodied persons to work towards their own support, it is elastic and contextually driven in fixing the amount of effort required and the socially sanctioned return on any contribution. In particular, the norm fully accommodates the notion that those who have expended reasonable efforts towards self-support for some portion of their adult life thereby “deserve” group support at a decent standard of living once their working life is deemed – either by convention and necessity – to be over.

Generous Social Security benefits are politically popular in part because the quid pro quo concept at the heart of the conditional reciprocity norm, which defines who “deserves” to draw on collective resources and how much they deserve, is not constrained by the actuarial realities of investment markets. Nor, despite the “insurance” rhetoric suggesting that persons who participate in the Social Security program are simply saving some portion of their own earnings for later use, does it limit participants to the market payoff from resources that recipients, either individually or as a group, have set aside through the program. Rather, the logic of conditional reciprocity views Social Security as a collective commitment to secure a minimally decent standard of living for all “deserving”elderly. Not only does this logic fail to restrict recipients to receiving no more than a fair market return on their pooled or individual savings, but it necessarily undermines efforts to reduce the burden on a shrinking working age population, which is heavily taxed to finance old-age benefits on a pay-as-you-go basis. A social security system that conforms to the dictates of a conditional reciprocity norm sits uneasily with the demographic realities of the modern world.

No. 57 February 2003

THE RIGHT TO WORK AND BASIC INCOME GUARANTEES: A COMPARATIVE ASSESSMENT

Philip Harvey (pharvey@camden.rutgers.edu)

The strategy of providing an unconditional basic income guarantee (BIG) to all persons is compared to the strategy of securing the right to work and income recognized in the Universal Declaration of Human Rights. A comparative assessment is offered of the relative cost of equally expansive versions of the two strategies (proposals capable of ending official poverty in the United States) along with their relative ability to achieve other policy goals. It is argued that a BIG would be a far more expensive way to eliminate poverty than a policy of securing the right to work and income by means of direct government job creation and targeted transfer benefits, that a BIG does not provide an adequate substitute for securing the right to work, and that the benefits a BIG would produce are likely achievable at substantially less cost by pursuing the Universal Declaration strategy.

No. 58, February 2003

Carework Salaries: The German Case and Beyond

Michael Opielka, Institute for Social Ecology (michael.opielka@sozialkunst.de)

The paper, prepared for the ILO (International Labour Office), discusses the introduction of a child-raising salary (or family allowance) esp. with reference to Germany. In this debate up to now there is almost no mention of the proposal of a guaranteed minimum income. This has to do with the different spheres within which the discussion takes place. The family-policy debate has been--at least until now--carried on among experts, and only recently widened to include principal socio-political questions implicit in the considerable public echo in Germany following the OECD comparative educational study "PISA 2000", as well as in the undesirable demographic developments, which for the first time are being publicly associated with deficiencies in family policy. The discussion over a guaranteed minimum income in Germany on the other hand has been stimulated above all by labor-market and tax policy considerations (negative income tax, combination wages for low-income earners), and is still highly controversial. Clearly a child-raising salary--depending on its actual form--has the same effect as a selective basic guaranteed income, limited to the child-raising person. The German welfare state is particularly wage-for-work oriented. The introduction of carework salaries in the form of a child-raising salary or family salary would widen this orientation, establishing a new way of earning a living for persons raising children. One can thoroughly see in this a step in the direction of a universal citizen-based family policy, the legitimacy of which will be the precondition to a general, freely available basic guaranteed income.

No. 59, February 2003
DISTRIBUTIVE JUSTICE AND THE ARGUMENT FOR BASIC INCOME

Almaz Zelleke, New School University (azelleke@att.net)

The defense of selective work requirements depends on a belief in the fairness of the distribution of income and assets produced by the capitalist economic system, in which property can be privately acquired, concentrated, and handed down in ways that can lead to vast economic inequality among citizens. This belief supports the sense of entitlement that taxpayers feel to enforce work requirements on recipients of redistribution. I argue that a problem inherent in theories of distributive justice, the inability to apply the same criteria of distributive fairness to the generations that follow the initial generation on which the theory is based, undermines the legitimacy of this belief. An examination of the effects of this theoretical problem points to basic income as a potential resolution.

No. 60, February 2003
TARGETED PROGRAMS V THE BASIC INCOME GUARANTEE: AN EXAMINATION OF THE EFFICIENCY COSTS OF FUNDING DIFFERENT FORMS OF REDISTRIBUTION

James B. Bryan, Manhattanville College, (bryanj@mville.edu)

Decades ago Arthur Okun developed the leaky bucket metaphor to capture two efficiency costs of redistribution: those surrounding the problematic incentives given to recipients (of means tested programs) and those surrounding the problematic incentives given to members of the donor population. Both groups face higher marginal tax rates as a result of redistribution. A great deal of research has focused on the first of these, especially among those who examine the options for welfare reform. Proponents of the Basic Income Guarantee correctly point out that the BIG greatly reduces many of the perverse incentives currently faced by the recipient population. However, a much less examined issue arises from the fact that BIG proposals usually imply far greater funding than do regimes of targeted programs. A serious consideration of a BIG proposal, then, requires an accounting for the additional efficiency costs from additional taxation. This paper will examine the literature on the marginal cost of taxation. It will use the results of this literature search in simulations that will illustrate the efficiency improvements on the recipient side that would be needed to offset the additional efficiency costs of funding a BIG. Minimizing the leaks from the bucket probably should not be the only goal of a redistributive program; however, such leaks must be among the things considered by policy analysts and policy makers.

No. 61, February 2003
SOCIAL GRANTS AND THEIR SOCIAL CIRCULATIONS

Eva Harman, University of Chicago, (emharman@uchicago.edu)

More than half of all South Africans are living in poverty. For many households, a social assistance grant is the only source of income. However, around half of all poor South Africans live in households that do not receive social grants. A basic income grant has been proposed to address the large gaps in the social security net and the widespread income inequality. In this paper I am concerned with how social grants are used in everyday life. How is it that a grant, awarded to an individual, becomes something around which many people organize, build lives, and relationships? How do large kin networks survive on the income of one social grant? Drawing on interviews that I conducted with recipients of social grants, I illustrate how social grants are mediated by social relations, historical dynamics, and material conditions. This exploration of how social grants circulate through relations on the ground exposes the contradictory categories that targeted social grants create. The way grants are socially mediated supports and complicates the case for a basic income grant in South Africa and for similar policies elsewhere.

No. 62, February 2003
BREAKING THE GLASS CAGE: HOW BASIC INCOME IS A QUALITATIVELY DIFFERENT SOCIAL POLICY PARADIGM

Harry F. Dahms, Florida State University (hdahms@garnet.acns.fsu.edu)

One assumption about social policy practice in industrialized nations is that concrete success should not be expected--in terms of designing policies, "solving" social problems, or the scope of stated goals. Yet to concede that a glass barrier may exist that thwarts the effectiveness of social policies, challenges the conventional wisdom about purpose and possibility of social policy. My hypothesis is that such a glass barrier preventing social policy success does exist, and that it is so much part of modern capitalist work society that its manifestations are ever-present, but its concrete implications for social, political, and economic life ever more elusive. The introduction of universal basic income (UBI) should have the effect of breaking the glass barrier impeding social policy success--even though this is not the stated intent of UBI. Instead, UBI is a reaction to problematic conditions, and an attempt to approach social problems, in a constructive manner. UBI, thus, is a necessary precondition for increasing the likelihood that policy will be designed to remedy how inequalities limit the life chances of members of certain groups, and the ability of government to implement policies that are likely to succeed, as far as structural inequalities are concerned.

7. NEW LINKS

FREELIVES, a Toronto-based progressive website, endorses a Basic Income Guarantee, under the name of Citizen’s Income. The website also discusses affordable housing, electoral reform, and other issues. You can find it on the web at: http://www.freelives.ca/.

8. LINKS AND OTHER INFO

FOR LINKS TO DOZENS OF BIG WEBSITES AROUND THE WORLD, go to http://www.usbig.net, and click on “links.”

THE U.S. BASIC INCOME GUARANTEE NETWORK (USBIG), which publishes this newsletter, is dedicated to promoting the discussion of the basic income guarantee (BIG) in the United States. BIG is a generic name for any proposal to create a minimum income level below which no citizen’s income can fall. Information on BIG and USBIG can be found on the web at: http://www.usbig.net. If you know any BIG news; if you have any comments on the newsletter or the web site; if you know anyone who would like to be added to this list; or if you would like to be removed from this list; please send me an email: Karl@Widerquist.com.

Thanks,

-Karl Widerquist, coordinator, USBIG.