Universal Income, A Utopian Ideal Or Economic Pragmatism?

Given our growing concerns about 'traditional' employment, some say paying people a basic living income should not be linked to work. The idea is appealing, but requires a leap of faith few politicians are willing to take.

At the French unemployment office
At the French unemployment office
Solveig Godeluck

PARIS â€" The good news for low-income workers in France is that as of January, they're eligible for a targeted monthly activity bonus. The bad news is that because of red tape, long lines and other built-in obstacles, only half of those workers will actually receive the benefit.

It's a problem of access. People who should be eligible to qualify for the bonus are discouraged by the bureaucracy, unsure of their rights, scared off by the risk of having to reimburse undue payments. Sometimes they don’t even know the aid exists.

There's a way to fix all of that: remove the conditions; do away with the contingencies. The state could choose instead pay all citizens a basic allowance that, for some, would complement the salaries they already have, and for the unemployed, offset their lack of earnings. No more humiliating paperwork. Goodbye poverty traps. It could also mean an overall reduction in the welfare state's operational costs since it would obviate the need for the various bonsues, scholarships and all the other income-related benefits currently in place.

This is what is called basic income, universal basic income or unconditional income, a concept that was developed by Milton Friedman, in the 1960s, Thomas Paine, two centuries earlier, and that French lawmaker Delphine Batho, a former government minister, is keen to pursue now.

For the past two years, the think tank Génération Libre has been promoting the creation of a monthly "Liber" consisting of 450 euros per adult and 225 eruos per child, balanced by a standard 23% tax on all revenues, including on capital.

"The simple deduction of the total of the Liber (basic and unconditional) from the Libertaxe (proportional to revenues) automatically leads to either a "negative tax" (for the lowest incomes), a sum of money paid in cash by the local authority, or a "positive tax" (for the highest incomes), a net contribution to the local authority," economist Marc de Basquiat and philosopher Gaspard Koenig write. The Liber, they insist, is designed to liberate individuals.

The French Digital Council also mentions basic income in its January report on the transformation of employment. Underemployment is becoming permanent, for diverse reasons that include robotization and the appropriation of value creation by a few Internet giants. And yet the current social protection, based on worker contributions, is becoming ineffective, the Council notes. Also, domestic demand could collapse for lack of job openings â€" hence the need to imagine "new value redistribution models" that are dissociated from work, to save both the welfare state and the entire economy.

From theory to practice

The idea is nice. But here's the thing: so far, apart from the oil state of Alaska, no one has established a basic income. Finland wants to have a try in 2017 and see the results in 2019. In the Netherlands, some 30 towns, in which environmentalists are strongly established, such as Utrecht and Groeningen, are set to experiment with a basic income at an unknown date. The Swiss are playing with the idea too, and may put it to a referendum in June.

Politicians, however, are still cautious on the issue. This oddity appeals and divides in all parties. People on the political right want to shrink the welfare state and make the most of the basic income to establish a "flat tax" instead of the progressive income tax. But they're afraid of creating generations of helpless people, who would refuse entry-level jobs. Leftists welcome the strengthening of social rights and the advent of a society liberated from the pain of work. But they're also nitpicky when it comes to benefits, unwilling to accept that some people, as is the case with all systems, will lose out.

Moreover, nobody wants to set off into the unknown and risk disaster. Creating a basic income that covers only minimum social benefits, scholarships, social welfare, housing assistance and employment subsidies would save money. But it couldn't, in that case, be more than 200 euros per month for adults and 60 euros per child, the French Digital Council calculated. Not enough to live decently. This is why the difference would have to be covered with other deductions. But the government, if it wants to pay every person between 500 euros and 750 eruos, will have to increase the social security contribution rate by 35 points.

The other solution would consist of keeping conditional benefits alongside the basic income. For instance, unemployed people who are no longer eligible for benefits would only receive the difference between the total of a specific welfare allowance (a bit less than 500 euros) and the new allowance. The problem there, of course, is that the conditionality, complexity and the costs that the basic income scheme promises to reduce would be back.

Half-measures like that are destined to fail, explains Philippe Van Parijs, a researcher from the Catholic University of Louvain and firm proponent of the basic income concept. "We can’t test the financial viability of the plan over two years, because we'd also have to adjust the tax system, eliminate exemptions, remove benefits," he explains. The net cost of doing all that, according to Van Parijs, would be higher than if we embraced the new paradigm all at once.

And yet without tests, who will be willing to take the leap? Van Parijs won’t let himself get downhearted. "Bismarck introduced social security without samples and experimentation," he recalls. "Before that, it was considered a utopian concept."

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Ecological Angst In India, A Mining Dumpsite As Neighbor

Local villagers in western India have been forced to live with a mining waste site on the edge of town. What happens when you wake up one day and the giant mound of industrial waste has imploded?

The mining dumpsite is situated just outside of the Badi village in the coastal state of Gujarat

Sukanya Shantha

BADI — Last week, when the men and women from the Bharwad community in this small village in western India stepped out for their daily work to herd livestock, they were greeted with a strange sight.

The 20-meter-high small hill that had formed at the open-cast mining dumpsite had suddenly sunk. Unsure of the reason behind the sudden caving-in, they immediately informed other villagers. In no time, word had traveled far, even drawing the attention of environment specialists and activists from outside town.

This mining dumpsite situated less than 500 meters outside of the Badi village in the coastal state of Gujarat has been a matter of serious concern ever since the Gujarat Power Corporation Limited began lignite mining work here in early 2017. The power plant is run by the Power Gujarat State Electricity Corporation Limited, which was previously known as the Bhavnagar Energy Company Ltd.

Vasudev Gohil, a 43-year-old resident of Badi village says that though the dumping site is technically situated outside the village, locals must pass the area on a daily basis.

"We are constantly on tenterhooks and looking for danger signs," he says. Indeed, their state of alert is how the sudden change in the shape of the dumpsite was noticed in the first place.

Can you trust environmental officials?

For someone visiting the place for the first time, the changes may not stand out. "But we have lived all our lives here, we know every little detail of this village. And when a 150-meter-long stretch cave-in by over 25-30 feet, the change can't be overlooked," Gohil adds.

This is not the first time that the dumpsite has worried local residents. Last November, a large part of the flattened part of the dumpsite had developed deep cracks and several flat areas had suddenly got elevated. While the officials had attributed this significant elevation to the high pressure of water in the upper strata of soil in the region, environment experts had pointed to seismic activities. The change is evident even today, nearly a year since it happened.

It could have sunk because of the rain.

After the recent incident, when the villagers raised an alarm and sent a written complaint to the regional Gujarat Pollution Control Board, an official visit to the site was arranged, along with the district administration and the mining department.

The regional pollution board officer Bhavnagar, A.G. Oza, insists the changes "aren't worrisome" and attributes it to the weather.

"The area received heavy rain this time. It is possible that the soil could have sunk in because of the rain," he tells The Wire. The Board, he says, along with the mining department, is now trying to assess if the caving-in had any impact on the ground surface.

"We visited the site as soon as a complaint was made. Samples have already been sent to the laboratory and we will have a clear idea only once the reports are made available," Oza adds.

Women from the Surkha village have to travel several kilometers to find potable water

Sukanya Shantha/The Wire

A questionable claim

That the dumpsite had sunk in was noticeable for at least three days between October 1 and 3, but Rohit Prajapati of an environmental watchdog group Paryavaran Suraksha Samiti, noted that it was not the first time.

"This is the third time in four years that something so strange is happening. It is a disaster in the making and the authorities ought to examine the root cause of the problem," Prajapati says, adding that the department has repeatedly failed to properly address the issue.

He also contests the GPCB's claim that excess rain could lead to something so drastic. "Then why was similar impact not seen on other dumping sites in the region? One cannot arrive at conclusions for geological changes without a deeper study of them," he says. "It can have deadly implications."

Living in pollution

The villagers have also accused the GPCB of overlooking their complaint of water pollution which has rendered a large part of the land, most importantly, the gauchar or grazing land, useless.

"In the absence of a wall or a barrier, the pollutant has freely mixed with the water bodies here and has slowly started polluting both our soil and water," complains 23- year-old Nikul Kantharia.

He says ever since the mining project took off in the region, he, like most other villagers has been forced to take his livestock farther away to graze. "Nothing grows on the grazing land anymore and the grass closer to the dumpsite makes our cattle ill," Kantharia claims.

The mining work should have been stopped long ago

Prajapati and Bharat Jambucha, a well-known environmental activist and proponent of organic farming from the region, both point to blatant violations of environmental laws in the execution of mining work, with at least 12 violations cited by local officials. "But nothing happened after that. Mining work has continued without any hassles," Jambucha says. Among some glaring violations include the absence of a boundary wall around the dumping site and proper disposal of mining effluents.

The mining work has also continued without a most basic requirement – effluent treatment plant and sewage treatment plant at the mining site, Prajapati points out. "The mining work should have been stopped long ago. And the company should have been levied a heavy fine. But no such thing happened," he adds.

In some villages, the groundwater level has depleted over the past few years and villagers attribute it to the mining project. Women from Surkha village travel several kilometers outside for potable water. "This is new. Until five years ago, we had some water in the village and did not have to lug water every day," says Shilaben Kantharia.

The mine has affected the landscape around the villages

Sukanya Shantha/The Wire

Resisting lignite mining

The lignite mining project has a long history of resistance. Agricultural land, along with grazing land were acquired from the cluster of 12 adjoining villages in the coastal Ghogha taluka between 1994 and 1997. The locals estimate that villagers here lost anything between 40-100% of their land to the project. "We were paid a standard Rs 40,000 per bigha," Narendra, a local photographer, says.

The money, Narendra says, felt decent in 1994 but for those who had been dependent on this land, the years to come proved very challenging. "Several villagers have now taken a small patch of land in the neighboring villages on lease and are cultivating cotton and groundnut there," Narendra says.

They were dependent on others' land for work.

Bharat Jambucha says things get further complicated for the communities which were historically landless. "Most families belonging to the Dalit or other marginalized populations in the region never owned any land. They were dependent on others' land for work. Once villagers lost their land to the project, the landless were pushed out of the village," he adds. His organization, Prakrutik Kheti Juth, has been at the forefront, fighting for the rights of the villages affected in the lignite mining project.

In 2017, when the mining project finally took off, villagers from across 12 villages protested. The demonstration was disrupted after police used force and beat many protesters. More than 350 of them were booked for rioting.

The villagers, however, did not give up. Protests and hunger strikes have continued from time to time. A few villagers even sent a letter to the President of India threatening that they would commit suicide if the government did not return their land.

"We let them have our land for over 20 years," says Gohil.

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