Opinions - 24.10.2013 - 00:00 

Unconditional freedom

A spectre is haunting Europe, the spectre of unconditional basic income. The fact that there is now going to be a referendum on it is of historic significance. Commentary by HSG lecturer Christoph Henning.
Source: HSG Newsroom


25 October 2013. Approval of the unconditional basic income (UBI) is by no means impossible. Its signal effect would be comparable to the introduction of pension, health and accident insurance in Germany at the time of Bismarck. Back then, the course was set for a century and it set a global example, even for the U.S. Admittedly, it was “only” the government’s reaction to more radical socialist demands. But for many today, the “Rhineland” ordoliberalism is preferable to deregulated neo-liberalism. This referendum might well have a similar impact, even if its result is negative.

Economic relief
It is no coincidence that, on closer inspection, the UBI is as double-edged as the social policy administered by the German authoritarian state was. On that point, a few things need to be said. But first, it must be clear that, for the majority of people, a UBI would be a great relief. It would bring economic relief and the end of humiliating visits to authorities.

A UBI would even offer people with “normal” working careers a chance to escape a domineering everyday treadmill and take time off, during which they would have time for themselves and their families. In short, a rich society would permit itself what is actually the object of wealth: a collective good life instead of a surfeited life for the few and an exhausting rat race for the many. This historic significance of a UBI cannot be dismissed.

People will ask what is the cost of all this and who is going to pay it. Some argue that a UBI is unaffordable, that it would undermine the work ethic (and eliminate the disciplining impact of wage labor) and would slow down macro-economic growth. Others fear that a UBI could even increase inequality in society by helping to cut wages and social welfare benefits. There have been debates about that for a long time.

Work ethic and affordability
This much can be said: the argument about affordability neglects the creative dimension and thus the purpose of a UBI. If we did not already have education and healthcare systems, the costs would appear “too high”, as well (think of the resistance to Obamacare!). But would we want to give up those benefits today? We allow ourselves other, much less “necessary” things that burn money (a CERN, the IOC, etc.). If the people decide to introduce a UBI, this affordability argument would be used as a pretext. Those who believe in the superiority of market forces should trust them to deal with the changed circumstances.

The argument about the work ethic ignores the fact that it is precisely the purpose of a UBI to give people the freedom not to have to accept just any job. One cannot seriously believe that up till now people have been taking poorly paying jobs for ethical reasons. It would not be wrong if employers had to do more for employees in the future. And why should we always focus on growth data? Today, pressure for continuous growth is part of the problem, not part of the solution. It can only be achieved at high political cost and environmental damage, and the fruit of this growth cannot be enjoyed if nobody has time due to the increased workload.

Less is more
The economic wealth concept is not the only one to consider; in an extreme case, it comes at the expense of other things that society values: free time, for example, the “human wealth” of cultivated leisure or the cultivation of social relations. In this case, one can surely switch off the alarm bells. What is alarming, however, is that critics calculate that people could be worse off with a UBI than before; for example, because the previous pensions or social benefits were higher or because wages would decrease substantially. As long as a UBI is not a living wage, it could become a casualization trap: a UBI that is not enough to live on still forces people to work, which, in the worst case, would not even help much.

If this is the reason for considering a UBI in conservative circles, the proponents should be careful here. Another reason for caution is the ideas about tax relief for those earning good money, which hide in the fine print of conservative UBI model calculations. One can only draw one conclusion from this: if a UBI is introduced, it has to be done properly – that is, so it allows a “dignified existence” for everybody (as envisaged in the initiative’s text) and does not further increase social inequality.

Picture: Photocase / Tim Toppik