The Strawman of a Minimal Universal Basic Income by the Social-democratic Left in Toronto

Simran Dhunna and David Bush have written an article that criticizes moves towards a universal basic income (see https://springmag.ca/against-the-market-we-can-do-better-than-basic-income) .

In two previous posts, I questioned Dhunna’s and Bush’s proposed solution to the problems which members of the working class face, namely an enhanced welfare capitalism (see The Expansion of Public Services Versus a Basic Income, Part Two: How the Social-democratic Left Ignore the Oppressive Nature of Public Services: Part One: Oppressive Educational Services and The Expansion of Public Services Versus a Basic Income, Part Two: How the Social-democratic Left Ignore the Oppressive Nature of Public Services: Part Two: Oppressive Welfare Services). Now I will look at their criticisms of the idea of a universal basic income (UBI).

I will endeavour to show that the authors of the article mainly create a straw concept of universal basic income (in order to criticize it all the more easily).

A Straw Minimal Universal Basic Income

Dhunna and Bush assume that, firstly, there would be a minimal UBI and, secondly, that it would somehow be realized immediately and without a struggle–since some members of the class of employers and their representatives advocate a minimal basic income.

They write the following:

Some on the left look to basic income to complement workers struggles, but the ruling class looks to basic income to blunt class struggle. When the fight to raise the minimum wage was at its height in Ontario, the Ontario Chamber of Commerce countered calls to to raise the minimum wage by stating, “we support the Government’s piloting of a Basic Income, which we see as a more efficient and realistic means of ensuring Ontarians are given greater security.” The business community was in favour of basic income because it acted as a political shield against reforming labour laws, and because a basic income also acts as a wage subsidy for businesses. Employers would be relieved from the pressure of increasing wages from their own coffers and put the onus on the state to top up incomes through general revenues. The burden of payment would shift from the employing class to the rest of us.

Of course, the class of employers would try to minimize basic income–just as it tends nowadays to try to minimize expenditure on public services for the working class (and increase expenditures, if necessary, on services that serve to oppress the working class–such as the police). The authors assume magically that employers will in fact get their way–without a struggle. If, however, an organized movement for the realization of a robust basic income (not the minimal basic income that Dhunna and Bush assume) were to develop, aiming for all to obtain a relatively high standard of living without having to work for a particular employer, then there is little reason to believe that the basic income would be merely a “burden of payment from the employing class to the rest of us.” To pay for such a robust universal basic income would require making inroads on both the power of employers (since it would attack the economic dependence of workers on particular employers) and on their income (since funding would involve substantially increased taxes on corporations).

There is no warrant for their assumption that there could only be the realization of a minimalist universal basic income–as I indicated in my last post on this subject.

References to “class struggle” in their article sound radical, but they really do not aim to question those premises.

The Alaska Model of Basic Income

It is interesting that these Dhunna and Bush refer to experiments in UBI that hardly are robust as so-called evidence that UBI would not work:

Many of the basic income experiments piloted by local governments ended rather abruptly, either running out of money, or ending after a newly elected government without the political commitment to the project axed the program. These are not just unfortunate bumps in the road, but speak to the real political and economic inviability of basic income. As the report summarized, “there is no robust evidence relating to UBI defined as unconditional, regular cash payments to individuals regardless of income or status. The schemes have seldom lasted long enough to test viability over more than a few years.” Thus, there is “no evidence that any version of UBI can be affordable, inclusive, sufficient and sustainable at the same time.”

The longest and largest sustained experiment in basic income is Alaska’s Permanent Fund dividend. Starting in the 1970s, the Alaskan government created a special state-run fund from a portion of oil revenues. Since 1982, the fund pays out a dividend to every permanent resident of Alaska (this annual amount has ranged from $1000 to 2000 per year in recent years). The newly elected governor of Alaska campaigned to increase the dividend, but this came at a cost. To pay for the increase, Governor Mike Dunleavy has pushed a series of cuts to the public university system, ferry service, and other public services. The economic crash in 2020 reduced the dividend payment to $992, and there is now a real question about whether the fund will be able to issue any dividends at all in the coming years

Here is what it says from one of the articles to which they refer above:

This year’s oil royalty check [for residents of Alaska] will be $992, one third of what is should have been under the statutory calculation, but all that the Alaska Legislature’s majority members could give, since they needed the rest of the Permanent Fund dividend dollars to pay for government programs.

If $992 is one third of what recipients normally received, then $2976 per year is what they normally received. If you divide that by 12 months, then you obtain $248 per month–hardly a robust level of basic income! Indeed, the yearly basic income in Alaska was usually less than this.

From Karl Widerquist (2012), “Exporting the Alaska Model to Alaska: How Big Could the Permanent Fund Be if the State Really Tried? And Can a Larger Fund Insulate an Oil Exporter from the End of the Boom?” in Exporting the Alaska Model Adapting the Permanent Fund Dividend for Reform around the World, page 173:

The most recent dividend was $1,174 in October 2011, and dividends have tended to be between $1000 and $2000 per person per year for the past 15 years.

Dividing $1000 and $2000 by 12 gives the low and high range of $83,33 per month to $166,66 per month. Using this model to refute the basic income model is grasping at straws.  Referring to such a basic income as if it were evidence of the infeasability of such a policy is illogical. It is an extremely weak counterexample, and yet they decided to include it in their “critique” of UBI. 

David Macdonald’s Study on Basic Income

The writers refer to David Macdonald’s estimate of a $29 billion federal fund required for one kind of scenario for a basic income. They write:

Some of the appeal of UBI comes from the wishful idea that it can solve all of our problems at once, lifting people out of poverty and making education and public services accessible. But the basic costs show that UBI is, by any measure, a terrible use of resources to address inequality and poverty. As the CCPA’s David MacDonald noted in his study, the $29 billion spent on such a UBI scheme would achieve — at best — less than a 2 percent reduction in the poverty rate, which would “be quite wasteful” when considering the amount of money spent.

I assume that they are referring to the following scenario (from David Macdonald (2016), A Policymaker’s Guide to Basic Income, page 21):

In Scenario 4, the government issues a $1,000 universal cheque in addition to offering all existing income support programs. In essence, this would be the 34th Canadian basic income program, and by providing support over and above what already exists, it would lower poverty rates across all age groups (see Table 6). An annual $1,000 cheque or bank transfer to all Canadians could either be taxed back at year’s end, or clawed back from existing programs.

Under this scenario, the overall poverty rate would fall two percentage points — taking 713,000 people out of poverty. The biggest impact would affect child poverty, which would drop three percentage points, from 10.9% to 7.9%. Adult poverty would drop from 11.8% to 9.9%. Seniors would see the smallest, though by no means insignificant, benefit under this scenar-

A $1000 cheque a year is, again, hardly a robust universal basic income–even if it were a top up to present income-enhancing schemes. Why do Dhunna and Bush fail to mention, once again, the wider context that shows how minimal such a scenario would be? Perhaps they want to create a straw model of basic income so that they can then proceed with their idealized solution to the problems that face the Canadian working class and community members face by proposing an expanded public service? Is this ethical? Is it honest?

Stereotypical Presentation of Those Who Advocate a Robust Universal Basic Income

Dhunna and Bush say this

Some of the appeal of UBI comes from the wishful idea that it can solve all of our problems at once, lifting people out of poverty and making education and public services accessible.

They present no evidence to show that those who advocate a robust universal basic income somehow “can solve all of our problems at once.” 

Bryant Sculos (2018), in  “Socialism & Universal Basic Income,” Class, Race and Corporate Power, Volume 6, Issue 1, shows that their view finds an echo in other stereotypical criticisms of a robust UBI: 

Most of the critics of UBI treat its advocates as though they believe UBI would solve all or most socioeconomic problems, at least in the Global North. I have yet to come across any serious UBI advocate who takes such an expansive position.

Contradictory Conception of the Capitalist Government or Capitalist State: 

Dhunna and Bush argue, contradictorily, the following:  

Instead of ending poverty, UBI could in reality entrench low wages and precarious work, and reduce workers’ bargaining power. In part, this reflects an analysis that understands that the state’s role under capitalism is to create conditions of profitability for capitalists, such that workers are further pushed into the labour market [my emphasis].

They also have the following to say: 

Our energy and money is better spent waging struggle directly to strengthen labour laws [my emphasis].

Of course, labour laws should be strengthened–but how does this come about except through–the capitalist state. They can argue for state intervention in the form of strengthened labour laws, but those who advocate for a robust UBI provided by the capitalist state cannot. Why is it that they can rely on the capitalist state whereas those who advocate for a robust universal basic income cannot?

In addition, as I have shown in a number of posts, labour laws (for example, relating to collective bargaining and management rights) may restrict the power of the class of employers but they in no way question the legitimacy of that power (see, for example, Management Rights, Part Nine: Is A Collective Agreement that Involves Management Rights and the Exploitation and Oppression of Workers a Fair Contract?Do Collective Agreements Convert Working for an Employer into Decent Work?Comments from John Urkevich, AESES-UM Business Agent, to my Critique of the Grievance and Arbitration Procedure: Letter to the Editor, Inside The Association of Employees Supporting Educational Services (AESES), Vol. 17, No. 4, May 1994). 

Why is it that Dhunna and Bush are silent on the limitations of labour laws and reliance on the capitalist state? Perhaps because they are biased towards reformist unions? Perhaps because they idealize unions and labour laws? 

I will let the reader figure out why Dhunna and Bush express such contradictions. Or why they propose the following: 

At the cost of $29 billion annually, we could have free transit in major cities ($10 billion), clean drinking water for every First Nation ($4.5 billion), eliminate tuition fees at all universities ($11 billion), and end homelessness ($4.5 billion). If we are spending $177 billion dollars a year (the cost of a negative income tax model to raise people to $21,810), we could have all of the above plus a universal pharmacare program, universal childcare, universal dental care, and begin to implement a robust public housing policy.  

Would not such policies be implemented–by the capitalist state? They criticize advocates of UBI for pressuring the capitalist state to provide for a universal level of income above the poverty line, but they rely on the capitalist state to provide free state services. What is sauce for the goose is apparently not sauce for the gander.

Furthermore, if the proposal for a robust universal basic income is used as an organizing tool and linked to the aim of abolishing the class power of employers and all classes, the issue of going beyond the capitalist state and indeed beyond capitalism arises–but that question never arises for Dhunna and Bush.

In a follow-up post, I will look at the one example which they provide that involves a more robust or ambitious UBI–the one referred to by the International Labour Organization.

An Implicit Assumption of a Zero-Sum Approach to Struggling Against the Class of Employers

Dhunna and Bush in the last quote above imply that improvements in the level of UBI will likely lead to reductions in services in other areas–a kind of zero-sum situation. However, reduction in social services have occurred over the years without the existence of UBI; there is no necessary connection between the two.

As I wrote in my first post on this topic, the struggle for a robust universal basic income and the expansion of public services need not be mutually exclusive. The working class should struggle for both–all the while aiming to abolish the class power of employers and not just reform it, as Dhunna and Bush aim to do (see A Basic Income Versus the Expansion of Public Services? Part One: Critique of the Social-democratic Idea that the Expansion of Public Services is Socialist).

Their implied zero-sum analysis in the following quote thus is also illogical:

The business community was in favour of basic income because it acted as a political shield against reforming labour laws, and because a basic income also acts as a wage subsidy for businesses. Employers would be relieved from the pressure of increasing wages from their own coffers and put the onus on the state to top up incomes through general revenues.

To claim that the “business community was in favour of basic income” is, again, true only on a minimalist assumption of a basic income–the “business community was in favour of [a minimalist version of” basic income–not a more robust version. The assumption for most of their article operates on this assumption so that they can easily refute such a model and provide their idealized version of the expansion of public services–their humanized version of capitalism, or humanized welfare capitalism (see my critique of that version in A Basic Income Versus the Expansion of Public Services? Part One: Critique of the Social-democratic Idea that the Expansion of Public Services is Socialist).

Conclusion

Dhunna and Bush assume a minimal universal basic income in order to provide superficial evidence against it. They stereotype the position of radical advocates of a universal basic income and have a contradictory conception of the nature of the capitalist government or state; they idealize labour laws and, implicitly, union as well as the provision of public services. In addition to these problems, they assume that there is necessarily a zero-sum situation facing the working class: either a (minimal) universal basic income or an expansion of public services. They exclude from consideration a simultaneous struggle for a robust universal basic income and an expansion of public services. Finally, they exclude any consideration of aiming to abolish the class power of employers and thereby the elimination of class exploitation and class oppression–once and for all. 

In a future post, I will look at their references to studies by the International Labour Organization (ILO) and Public Service International (both international social-democratic labour organizations).

The Poverty of Academic Leftism, Part Six: The Idealization of the Nation State or the National Government in the Wake of the Coronavirus Pandemic, Part One

Professor Noonan, a self-declared historical materialist and teacher of Marxism, continues to argue a political position that ignores the reality of capitalist society. In his post Back to the Magic Mountain, he argues the following:

No one should fetishize the nation state, but it remains the dominant form of political society and, when it chooses to, it can marshal the power to override capitalist market forces. The dependence of human life on market forces has been suspended in large parts of the world during this crisis. The state has effectively taken over the direction of economic activity and positioned itself as the guarantor of people’s income. We have been re-acquainted with a truth that capitalism works hard to suppress: our lives depend upon collective labour and nature, not market forces. This truth has to become the basis for post-pandemic reconstruction.

Professor Noonan’s opening part of the first sentence, “No one should fetishize the nation state,” is supposed to prevent any criticism of what follows. Professor Noonan, he implies, does not fetishize the nation-state.” The use of the conjunction “but” then is used to do just that.

In a Canadian context, Professor Noonan, in his statement: “The dependence of human life on market forces has been suspended in large parts of the world during this crisis. The state has effectively taken over the direction of economic activity and positioned itself as the guarantor of people’s income,” can refer to the provisions for workers to receive $500 a week for up to sixteen weeks through the Canadian Emergency Response Benefit (CERB), a federal program. From workers’ point of view, such economic relief is of course welcome–if they qualify (they must have worked a certain number of hours, for example–although some of the gaps are being addressed).

Professor Noonan forgets that workers are means to employers’ ends (see The Money Circuit of Capital). Consider things that you own, use and need. Do you take care for them in some way? They are means to the end of your goals, but you do care about preserving their existence in order to achieve your goals. Professor Noonan idealizes (and fetishizes) the modern state. The Canadian federal government, like other governments, instituted income policies because the workers could not temporarily work for employers–and because they lack their own independent means by which to produce and hence to live.

Employers need employees in one way or another if they are going to continue to be employers. The modern state intervenes in the capitalist market, if necessary, because that market needs the continued existence of workers as employees. The dependence of employers on employees can be seen from the following issue that arose in the 1860s in England in relation to the possible emigration of skilled English workers (from Karl Marx, Marx-Engels Collected Works, volume 35, Capital:

The reproduction of the working class carries with it the accumulation of skill, that is handed down from one generation to another.1′ To what extent the capitalist reckons the existence of such a skilled class among the factors of production that belong to him by right, and to what extent he actually regards it as the reality of his variable capital, is seen so soon as a crisis threatens him with its loss. In consequence of the civil war in the United States and of the accompanying cotton famine, the majority of the cotton operatives in Lancashire were, as is well known, thrown out of work. 471 Both from the working class itself, and from other ranks of society, there arose a cry for State aid, or for voluntary national subscriptions, in order to enable the “superfluous” hands to emigrate to the colonies or to the United States. Thereupon, The Times published on the 24th March, 1863 [p. 12, col. 2-4], a letter from Edmund Potter, a former president of the Manchester Chamber of Commerce. This letter was rightly called in the House of Commons, the manufacturers’ manifesto.2′ We cull here a few characteristic passages, in which the proprietary rights of capital over labour power are unblushingly asserted.

“He” (the man out of work) “may be told the supply of cotton workers is too large … and … must … in fact be reduced by a third, perhaps, and that then there will be a healthy demand for the remaining two-thirds…. Public opinion … urges emigration….The master cannot willingly see his labour supply being removed; he may think, and perhaps justly, that it is both wrong and unsound…. But if the public funds are to be devoted to assist emigration, he has a right to be heard, and perhaps to protest.”

… He [Mr. Potter] then continues:

“Some time …, one, two, or three years, it may be, will produce the quantity…. The question I would put then is this — Is the trade worth retaining? Is it worth while to keep the machinery (he means the living labour machines) in order, and is it not the greatest folly to think of parting with that? I think it is. I allow that the workers are not a property, not the property of Lancashire and the masters; but they arc the strength of both; they are the mental and trained power which cannot be replaced for a generation; the mere machinery which they work might much of it be beneficially replaced, nay improved, in a twelvemonth.’: Encourage or allow (!) the working power to emigrate, and what of the capitalist?”a “…Take away the cream of the workers, and fixed capital will depreciate in a great degree, and the floating will not subject itself to a struggle with the short supply of inferior labour…. We are told the workers wish it” (emigration). “Very natural it is that they should do so…. Reduce, compress the cotton trade by taking away its working power and reducing their wages expenditure, say one-fifth, or five millions, and what then would happen to the class above, the small shopkeepers; and what of the rents, the cottage rents…. Trace out the effects upwards to the small farmer, the better householder, and … the landowner, and say if there could be any suggestion more suicidal to all classes of the country than by enfeebling a nation by exporting the best of its manufacturing population, and destroying the value of some of its most productive capital and enrichment…. I advise a loan (of five or six millions sterling), … extending it may be over two or three years, administered by special commissioners added to the Boards of Guardians in the cotton districts, under special legislative regulations, enforcing some occupation or labour, as a means of keeping up at least the moral standard of the recipients of the loan … can anything be worse for landowners
or masters than parting with the best of the workers, and demoralising and disappointing the rest by an extended depletive emigration, a depletion of capital and value in an entire province?”

Potter, the chosen mouthpiece of the manufacturers, distinguishes two sorts of “machinery”, each of which belongs to the capitalist, and of which one stands in his factory, the other at night time and on Sundays is housed outside the factory, in cottages. The one is inanimate, the other living. The inanimate machinery not only wears out and depreciates from day to day, but a great part of it becomes so quickly
superannuated, by constant technical progress, that it can be replaced with advantage by new machinery after a few months. The living machinery, on the contrary, gets better the longer it lasts, and in proportion as the skill, handed from one generation to another, accumulates.

…the factory operatives are part of the movable fittings of a factory. Their emigration was prevented.1; They were locked up in that “moral workhouse”, the
cotton districts, and they form, as before, “the strength” of the cotton manufacturers of Lancashire.

With millions of workers being sent home in order to prevent damage to human beings as employees–a necessary part of the process of capitalist production and exchange as well as governmental processes– the government’s intervention in being “the guarantor of people’s income” looks much less positive. The government or state (here the distinction is not important) is not the benevolent, neutral institution that Professor Noonan makes it out to be. It is providing income as a stop-gap measure until the capitalist and governmental processes can once again operate normally.

Indeed, Professor Noonan implies as much when he writes:

The danger, of course, is that the state is currently acting under emergency powers, but will revert to its standard function of enframing and protecting capital, if we let it.

Professor Noonan sees the provision of income by the state that is supposedly independent of market forces as something positive–but as we have already seen, the preservation of workers independent of the market in the sense that they can obtain money without having to work for an employer–is only a temporary measure that in no way is in opposition to the interests of the class of employers.

As the pandemic recedes in intensity, at least two issues will arise concerning the opposition of the working class to the nation-state. Firstly, there will be increased intensification of calls for workers to go back to work for employers despite the health risks. After all, around 1000 workers die and 600,000 workers are injured every year in Canada; health and safety are not a priority for the Canadian state.

Secondly, the issue of who will pay for the temporary income of workers and the subsidies for employers during the pandemic will arise. Although calls for cutbacks in health care will undoubtedly be more difficult to justify, cuts in other areas (such as education) will probably intensify.

Without a movement that expressly or consciously opposes the treatment of workers as things to be used by employers, the temporary measure taken by the Canadian (and other capitalist) government(s) is just that–a temporary measure. There will likely be opposition from the labour movement and from communities to the treatment of such measures as temporary, but since the labour movement and communities, for the most part, share Professor Noonan’s view that the state can somehow overcome its own nature as a capitalist state, the tasks required for converting such temporary measures into permanent measures cannot be addressed.

Professor Noonan refers to “we.” But who is this “we?” The “we” is a figment of his social-democratic imagination. In order for there to be a “we,” there would have had to have been much prior preparation. Has Professor Noonan engaged in such preparation? Not at all. He has engaged in the idealization of the collective-bargaining process and promoted class harmony (see earlier posts, such as  The Poverty of Academic Leftism, Part Five: Middle-Class Delusions).

Surely an essential part of the process of our preparing for a society where we all have our biological, social, intellectual, emotional and aesthetic needs met is a negative process–a process of coming to understand that the present social relations inside and outside work are in opposition to our interests and nature and that we therefore need to organize to change the situation by abolishing all class relations and relations of oppression.

However, my experience here in Toronto has been that most of the so-called left simply do not want to deal with the issue and attack those who do, such as calling them “a condescending prick,” ridiculing them and so forth. Alternatively, they ignore the issue by remaining silent over the issue. For example, John Clarke and other so-called radicals here in Toronto opposed calling for a basic income; I called for a radical basic income in opposition to Mr. Clarke’s rejection of any consideration of a basic income (see Basic Income: A Critique of the Ontario Coalition Against Poverty’s Stance). It has been largely ignored by the left here in Toronto; there has been no real discussion or movement for establishing a radical basic income here in Toronto.

Professor Noonan’s reference to “if we let them” is, therefore, utopian thinking. My prediction is that at best there will be some pressure from the organized social-democratic left for the maintenance of some kind of improvements in the welfare state, but that is all. Of course, there will be counter-pressure by the government or state and the class of employers to such improvements.

Professor Noonan’s further utopian social-democratic thinking can be seen in the following:

The alternative is to use this crisis as a basis of legitimacy for the state– under the control of democratic political forces acting in our shared life-interest– to assume control over the productive basis of society and re-orient production to serving life-needs.

I certainly share the goal of having “the productive basis of society…serving life-needs,” , but Professor Noonan has not shown how he or other members of the so-called progressive left have engaged in the preparatory work necessary to take advantage of a crisis.

Professor Noonan’s reference to using

“this crisis as a basis of legitimacy for the state–under the control of democratic political forces acting in our shared life-interest–to assume control over the productive basis of society and re-orient production to serving life-needs”

follows in the footsteps of another post by Professor Noonan, a post that assumes the present existence of certain social relations that are required if other social relations are to arise. In the previous post already referred to above, I pointed out how contradictory Professor Noonan’s theoretical position is with respect to the interests of most workers at universities; Professor Noonan assumed that there was already democracy at universities and thereby assumed what in fact needs to be accomplished.

The same logic applies here. If we already have democratic control of forces “acting in our shared life-interest,” then we already have “control over the productive basis of society” and have already “reoriented production to serve life-needs.” The reconstruction of the economy is democratic control. We need to reconstruct the political and the economic simultaneously and not the so-called political seizure of power occurring before and then democratic control of the economy somehow following afterwards.

Professor Noonan’s call for nationalization by the present state ignores this problem altogether by assuming that nationalization by the modern state will somehow magically lead to control over our own life process and life needs:

 Nationalization can pre-figure democratic socialization, and democratic socialization can re-focus economic life on collective work to provide each and all that which we really need, and freeing our time for the– real-life, multidimensional– experiences, actions, and interactions that make life worth fighting for, protecting, and living.

The call for nationalization as a prelude to socialism is typical of social democrats; they idealize and fetishize the modern state–contrary to Professor Noonan’s disclaimer–and thereby short-circuit what needs to be done–expose the anti-democratic and alienated nature of the modern state–a nature that has its parallel in the modern economy dominated by a class of employers or what some call civil society (see Employers as Dictators, Part One).

This issue, however, is somewhat complicated and will be dealt with in the next post. Professor Noonan’s position, ironically, is similar in some ways to the Leninist view of the modern state–a view that Professor Noonan supposedly finds unsatisfactory.