Canada is the latest country to pilot “Universal Basic
Income” after European countries such as Finland, and several Dutch cities. The
Canadian government will be giving its citizens, in a pilot project, monthly
checks of $800 to $1000 dollars regardless of their employment status, ability
to work, and age: this is what is called money “without any strings attached”.
Capitalism has gift wrapped the idea of Universal Basic Income by describing it
as giving people just enough money and the incentive to find their “dream
job”, to “become entrepreneurs”, or to
“seek higher education”, without the
pressure to work just to pay for their basic necessities such food and rent. So
why is capitalism giving away “free” money to people? Has capitalism really
grown a conscience? The idea of capitalism giving away “free money” and “without
any strings attached” is making the left
spin on its head to try to figure out.
To begin, it’s important to understand what money is. Money,
and its value, represents social labour. It is “social” because it is inherently
different from the private work you do at home, such as growing potatoes for
your own personal consumption. “Social labour” is the work you do for others in
the process of production. The “value” of money and social labour is immaterial
and invisible. This “value” only exists within a social relation (between you
and the capitalist in the process of commodity production), which is
immaterial. Money gives this immaterial and invisible social relation (i.e. social
labour), a material and tangible form. This is necessary in order to facilitate
basic transactions in society and commodity exchange. Thus money can store “value”
(social labour), and because money is tangible and material, it can also be
accumulated, and it allows for the private appropriation of social wealth. In this way, without social labour, money
would have no real value. It is the worker him/herself that creates the value
within the social relation in the act of production.
The money that the worker receives in exchange for his/her
social labour in the act of production (his/her wages), is used to buy basic
necessities s/he needs to reproduce his/her own labour. If the wages are too
low, the worker is unable to exchange it for food and shelter (rent) and other
basic necessities that he/she may need. Workers’ wages are also important because
they create the “demand” for the very products that are produced in the act of commodity
production.
The Keynesian model employed by capitalism until the
neo-liberal era (1970’s), was designed to protect the “demand” in the economy. This
meant that the capitalist paid the workers comparably better wages, and the capitalist
class, through high taxation by the state (up to 90%), paid for healthcare, education
and basic infrastructure. Thus, with the Keynesian model, the capitalist class
had a greater responsibility, a greater cost, in production and in reproducing social
labour. This system allowed the workers to spend more of their wages (money), in
the commodity market, thus generating a greater “demand” in the economy. This economic
model was called “demand management”.
The neo-liberal era, brought to you by the likes of Ragan, Thatcher
and Pinochet, was focused on the supply side
of production. The capitalist class, the 1%, pushed back against the working class
in the form of a class assault and class war in order to reduce its costs and
lower its taxes, thereby increasing profits. The neo-liberal model has reduced the cost of the reproduction of social
labour on the capitalist class. It reduced the taxes for the rich and the
1%, and this in turn slowly eroded and liquidated (privatized) the welfare
state and basic social services. Neo-liberalism (supply side economics), also
employed several instruments (such as globalization of trade and attacks on
unions) to lower working class wages. This has left the working class to use
his/her lower wages to pay for basic use values including education, healthcare
and housing. The neo-liberal era’s inexorable outcome has been a reduced “demand”
in the economy due to the lower disposable income of the working class. When
wages became too low to generate the demand necessary in the market, capitalism
began utilize the classic “buy now and pay later” scheme, in the form of credit,
to bridge this gap. Inevitably, this was one of the causal factors of the 2008
crisis.
Nearly a decade has passed since the 2008 economic crisis, and capitalism is still searching for a remedial solution to stimulate growth. Millions of people around the world are still grappling with low wages, liquidated social services, and abject poverty. The capitalist system is still unable to generate real demand in the economy. The truth is, capitalism does not have many options left. It cannot go back to the Keynesian system (demand management), because the oligarchy, the bourgeois, will never vote themselves in to paying higher taxes, and the indebt working class is bereft, and has nothing left to give.
In the context of neo-liberalism, the Universal Basic Income
represents the desperation of capitalism to generate demand in the economy. It
demonstrates that the system can no longer solely depend on the interest rate
of the central bank to stimulate the economy. Also, the money it wishes to
redistribute is not coming from an increased taxation of the oligarchs either,
but instead the taxation of the working class itself. The Universal Basic
Income is in fact an extension of the neo-liberalism assault on the working
class, not capitalism growing a conscience. Insidiously, the UBI will be utilized to put a
greater pressure on whatever has remained of social services. The working class
will be encouraged to seek private options for their basic social service needs
rather than support the unionized social service sector. The bourgeois state
will slowly wash its hands of any remaining responsibilities in “managing” society
and will take on a more purely economic role.
At a macro level, money, representing social labour,
inherits its value from the labour of the working class in the process of
production. However, labour is entitled to, and should have ownership of what
is produced. Capitalism’s form of production, and the private appropriation of
social wealth, robs the worker of the product of his/her own labour. Capitalism’s Universal Basic Income scheme is like
putting lipstick on a pig. It is akin to someone stealing an item from you, wrapping
it, and giving it back to you in the form of “gift”.
There is ultimately nothing “strings free” about the
Universal Basic Income, as this money is generated from the working class
itself. The “income redistribution” it claims is in fact the opposite. Instead
of increasing the taxes of the rich and the wealthy, strengthening worker
associations, and lowering the cost of living, the UBI will further liquidate
the social services by propping up the private markets. Also, UBI will inevitably
increase the rate of inflation, making the cost of living even more expensive,
leaving even less disposable income in the hands of the working class. Instead
of being a real remedial solution to economic inequality and to the crisis
prone capitalist system, it will deepen this inequality and the gap between the
powerful and the powerless in society.
Universal Basic Income has a different definition under
socialism. One of the underlying premises of socialism is restoring the dignity
of the working class with a social appropriation of wealth. Basic human needs
and use-values, such as housing, education and health care, are no longer paper
proclamations but a reality and not subject to the exchange-value market. Where
social labour is no longer alienated and exploited for private accumulation and
appropriation, but for accommodating for the needs of society and as a
contribution to humanity. Money, when necessary, will strictly facilitate
exchange of use-values rather than accommodating a class theft of the products
of social labour.
By Chia Barsen
WWW.CHIABARSEN.COM
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