Guy Standing on an economy that works for everyone

Standing: Of course we can. That’s why I’ve written The Precariat Charter, setting out twenty-nine policies that would put our economy and our planet on more sustainable footing. But first we have to realize that our politicians have been craven, serving corporate interests rather than common citizens. The U.S. Supreme Court decision in Citizens United was a terrible ruling, giving corporations hugely increased ability to sway and buy politicians. Quite clearly the system is rigged.

My argument in The Precariat Charter and The Corruption of Capitalism is basically that the income distribution system of the 20^th century has broken down. I don’t think that real wages in the U.S., or the U.K., or any other industrialized economy, will rise by much in the next ten, twenty years. In these circumstances we need to ask: how can we have the benefits of freedom, an open economy, dignified treatment of citizens, and respect for democracy, and at the same time restructure the economic system so we have far less inequality?

In The Precariat Charter I argue that demands for new rights always arise from the emerging mass class, as they did in the Magna Carta, back in 1217, which could be interpreted as the first class-based set of demands made against the state for the rights of people. What new demands do precariats need to make to regain the Enlightenment values of liberty, fraternity, and equality?

I won’t describe all twenty-nine proposals in detail, but one is that we must move towards a universal basic income for every legal resident of society. I’ve been proposing this for many years based on my work as a development economist—where unconditional basic income has been transformative in places like India and even Germany. I’m pleased that more and more mainstream economists, political scientists, and philosophers now see why this is a desirable part of a progressive strategy: because we will not get basic security for people in the precariat by relying on wages. And we won’t get security from the conventional welfare systems used in Europe and in the U.S., which are conditional, means-tested, and selective. They don’t benefit many precariats, which are the largest demographic group. We’ve got to understand that basic economic security is a human right for any member of a society. A basic income is part of that policy.

Goodman: Why will we not get greater equality based on traditional welfare-type benefits?

Standing: One reason is means testing: only people in poverty qualify. And when welfare budgets are cut, the level of poverty required becomes extreme. This very quickly leads to governments also trying to verify whether or not recipients are deserving of benefits—or whether they have character flaws, as in they just don’t want to work. So recipients must now prove their poverty and also their worthiness through satisfying more and more conditions. The consequence has been that an extraordinary number of people who need help can’t get it.

Every bit of research across the world has shown that means-testing leads to excluding people from benefits. It’s also extremely costly and bureaucratic and of course it leads to the reforms that President Clinton introduced in 1996, “ending welfare as we know it.” The context for providing public benefits has changed from a society that regards all of its members as deserving of them because any of us could be down on our luck at any given moment, to one in which those who need help are condemned as “welfare queens,” or “skivers, cheats, and lazy bums.” These pejorative terms are a disgrace to modern society. We don’t know how a particular individual falls into misery and lack of capacity to function, but policies have become far more moralistic and paternalistic and increasingly coercive. Now we’ve got “workfare,” which was developed in Wisconsin initially and then spread all over the world, where people in the lower reaches of the economy are treated in a very coercive, controlling way, with surveillance and all sorts of other techniques. It’s no way to run a just society. Unless we reduce the insecurity at the bottom half of society, sooner or later we’re going to get social explosions here, there, and everywhere. You can’t build a democracy based on exclusion. Our goal must be to give people a sense of belonging, a sense of a share in the social production that’s taking place.

Goodman: How would an unconditional basic income work?

Standing: Basic income would mean that every legal resident or citizen of a country would receive a modest amount each month that would enable them to have at least the means to buy food and pay their rent. It would be paid individually to each man, each woman and child—each child receiving half the amount of an adult and paid to the mother. On top of basic income you would have needs-based supplements for disabilities or particular costs of living. Other forms of social protection—private insurance or employer benefits—would be additional. The idea is to assure people of basic security in their society.

There are two fundamental reasons to move in this direction. One is philosophical. Thomas Paine was perhaps the first to understand that the wealth of any individual in any society has far more to do with the efforts of their ancestors than with anything individuals do themselves. Collectively, we benefit from the efforts of previous generations. As a result, we should all share in the collective wealth they have generated.

Ironically, it is often the rich who say, “It’s not right to give something to people who’ve done nothing to earn it” but who have no problem receiving their inheritance, which they did nothing to earn. If you believe you have a right to benefit from the work of your ancestors, then recognize that we all have a right to benefit from the work of our ancestors.

The second reason we need to implement an unconditional basic income is that we are not going to reduce income inequality without it. Neoliberal economics have changed the game to reward capital; to downsize, outsource, and fragment labor. When corporations gained the right to do business anywhere, putting workers in developed economies in direct competition with workers in emerging economies, they knew they were going to increase inequality. When corporations employ technology to eliminate jobs and increase profits, they know they are going to increase inequality. What are all of these displaced workers supposed to do?

Interestingly, our experience shows that these workers will find ways to contribute once their basic survival needs are met. They will care for their young children, aging parents, and others who need help. They will start their own businesses. They will pursue their art. They will volunteer in causes they are passionate about. That’s one of the differences between unconditional basic income and the paternal, coercive form of benefits typical now. Instead of the government controlling what you do with your benefits—use these benefits to purchase food, but only certain types of food; use these vouchers to pay your rent, but only for certain types of housing—basic income leaves it up to individuals to spend their money as they see fit. It’s a completely different mindset: the government trusts you to act in your own best interest. There’s a short video (Basic income works!) that shows the variety of things recipients of an unconditional basic income in India did with their money.

Of course, critics say that it’s unaffordable. That argument is complete nonsense because we gave the banks billions of dollars in quantitative easing for which they did nothing except make a mess of the economy. The U.S. and the U.K. could eliminate corporate subsidies, which total more than 90 billion dollars a year at the federal level in the U.S. alone, and pay an unconditional basic income instead. Ninety billion dollars is 50% more than the federal expenditure on all current poverty-reduction programs. So it’s not a matter of having the funds; it’s a matter of shifting expenditures from gifts to the rich and corporations to paying a basic income so that people have a place in the society.

The second objection is that if you give people a basic income they will all be lazy. But pilot studies in various countries have shown that if you give people basic security they actually have more energy, more confidence, more optimism about their future. The result is that they work more, not less, and are happier, more productive, more cooperative, and more satisfied.

A third argument, which is sometimes put by trade unions, is that basic income would make wages fall. The reality is that if people have a basic unconditional income they bargain more rationally. If I don’t want to take a lousy job because the pay is too low, I don’t have to do it for mere survival. It’s actually our present system—workfare—that lowers wages because it coerces people to accept low-paying jobs and training schemes that don’t lead anywhere. Workfare is basically a taxpayer-funded gift to businesses and has a terribly negative effect on both the persons employed and on the prevailing wages of other workers. The whole system we’ve got at the moment is dysfunctional, inefficient, and inequitable. Moving towards a basic income is a much more rational, equitable, easy-to-administer system of income distribution, which is much more consistent with a flexible, open economic system.

Goodman: And you haven’t even suggested shifting a portion of our obscene spending on the military to pay for unconditional basic income.

Standing: Exactly.

Goodman: Our current economic system is also pushing the natural world to the brink. What does A Precariat Charter have to say about environmental sustainability?

Standing: One of the almost criminal aspects of 20^th century economics was to make all forms of work that are not paid labor disappear from economic accounting. There is a vast amount of work done that is not remunerated and we actually need to encourage more of it: caring for one another, caring for the commons, and caring for the community. These are all reproductive activities in the broadest sense of that term. The Precariat Charter proposes reviving the “commons,” which are zones of shared public space. We need strategies that diminish the competitive tendencies to seize something and use it as a resource. We presently measure growth—the so-called health of our economy—in how fast we’re using up resources. That’s lunacy. In actual fact we’re depleting the commons and robbing ourselves of a future. We need to place a much higher value on preserving resources, preserving the commons—and even preserving our social structures. We need much less emphasis on financial growth, which a totally false and unbalanced way to run society.

It’s interesting that wherever I talk to precariat groups I don’t need to convince them we have to make our ecological challenges central to any economy. We also need a way of slowing down the speed of transactions—the rate of change—in our societies. We need a “slow time” movement as well as a slow food movement. We need a greater sense of control of our time, so we don’t feel that paid labor is the only justifiable activity of human beings. Work of other forms is actually more important and should be given just as much respect as the pursuit of growth, per se, which too often is focused on producing more “goods” that are often actually “bads.” Our whole way of thinking has to change.

Goodman: Do you recommend any specific strategies to protect the commons?

Standing: We have to give them much greater attention in political discourse. We have to make a priority of rescuing and preserving public land and preventing industries like fracking and mining from taking place on them. One strategy is to heavily tax those who would deplete the commons, so that corporations can no longer ignore the social costs—including pollution, erosion, habitat destruction, species loss, noise, and opportunity costs—they’re imposing. We don’t have control of the fracking industry, which is now the latest to deplete the commons, including water and air. We also need to reform policies that give corporate interests the ability to pollute and get away with it and all of these so-called trade investment pacts, including the Trans-Pacific Partnership, that have been disgracefully biased towards corporate interests. Unfortunately, ordinary citizens are painfully unaware of what’s gone into those treaties—and that’s by design. My hope is that journals like yours give attention to them. We have over three thousand trade and investment treaties, which are hardly ever discussed and which are all weighted very heavily towards private corporate interests and against ordinary citizens. It’s a shameful aspect of neoliberalism that, through these treaties, they’ve constructed this global institutional architecture, which ignores the commons, human rights, indigenous rights, and precariat issues. All of these things need to be exposed so that we can mobilize to oppose them more effectively.

Goodman: Will you please summarize the other salient features of the Precariat Charter?

Standing: Many of the articles in the charter address institutional changes we need, including the need to de-commodify education. Our view of education has devolved from the lofty purpose of giving people an historical and cultural context in which to understand themselves and their fellow citizens—as well as to stimulate curiosity, ethical values, and creativity—to a profit-oriented industry churning out cogs for the industrial machine. I go so far as to call modern education a fraud, because it is sold as the means to a job, but the jobs are not available for all who are being trained for them. A related article addresses the need to regulate student loans and payday loans, which have become poverty traps for millions.

Still another article of the charter addresses the need for due process for all. Many western governments act as if this is a given, but the reality is far different. This is a huge issue for precariats because they are the ones most frequently required to submit to arbitrary decisions made by unaccountable bureaucrats. This is infuriating, infantilizing, stressful, and one of the primary injustices committed on a routine basis in so-called democratic societies. Homeowners who tried to prevent banks from taking their homes through foreclosure are a dramatic case in point. The overwhelming majority didn’t have the means to argue their case before the administrative judges who would frequently decide in favor of the banks “en masse.”

The charter also talks about the need for new institutions to give people collective representation in society—because we all need collective voices to speak for us. I argue that we need to marginalize charities because charity is bad social policy. It treats recipients as victims, rather than as citizens with rights to the benefits of their society. Charity should be supplemental, not a substitute for rights-based policy. Or, as St. Augustine said, “Charity is no substitute for justice withheld.”

Article 29 addresses the need to strengthen deliberative democracy—which means a more open, transparent, and deliberative politics based on public participation in discussion of the issues, rather than on pundits providing soundbites, manipulation, and post-truth assertions that have no basis in fact. Neoliberalism has achieved the commodification of politics, along with everything else, and this is a trend that must be reversed. Politics is too important to leave to the elites, yet it has become so ugly and corrupted very few who are motivated by public welfare, rather than greed for power, want to have anything to do with it. In the last two U.S. presidential elections less than 60 percent of the electorate voted, and just over half of those were enough to carry the election. With over three million “felons” and others denied a vote altogether, less than 30 percent of the population carries an election. In Germany, too, only a third of the electorate voted for Chancellor Merkel in the 2013 general election.

There are many reasons for this, but some points are worth mentioning. If the “costs” of voting—the difficulty, inconvenience, etc.—exceed the expected return, it is rational not to vote and let others decide the outcome of an election. This rationale grows stronger if the perceived differences between the candidates and parties are small. This has been the trend in the last several decades, but the precariat may change all that, which would be a good thing for democracy. The more precariats are involved in politics, the more ecological and social justice issues will prevail because these are the issues that affect them.

In short, the Precariat Charter consists of an entire set of policies, which each taken in turn are not radical or impossible or utopian. They’re all feasible. Taken as a package they would radically transform the economic system and reduce the inequalities and insecurities that are the terror of the precariat.