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Food bank preparation. Photo: Food Bank CENC via Flickr

Food bank preparation. Photo: Food Bank CENC via Flickr

Mistaking the neoliberalism-lite handout policy of basic income for social justice is a disastrous road for a left-led Labour Party to go down, argues John Clarke

Long time basic income advocate, Guy Standing, has issued a report for the Shadow Chancellor calling for this policy to be pursued and John McDonnell has announced that a Labour Government would, indeed, proceed with BI pilot projects. As an organiser with the Ontario Coalition Against Poverty (OCAP) in Toronto, I fully understand how inadequate and oppressive systems of social benefits are and how rapidly there are being degraded. However, despite hopes to the contrary, I’m firmly convinced that basic income doesn’t offer a progressive alternative but, rather, represents a neoliberal trap for our movements. In my view, therefore, the decision to lend legitimacy to this social policy is extremely unfortunate, given the enormous prestige the Corbyn led Labour Party enjoys on the left internationally.

Standing makes very bold claims in the report about the ‘transformative’ and ‘emancipatory’ possibilities of basic income but very little thought is given to the implications of a universal cash payment that commodifies social provision being introduced at a time when the prevailing agenda is one of austerity and privatisation.  Standing is, of course, quite correct in the charges he lays against the  punitive and degrading social benefits structure in the UK and is also utterly justified in suggesting the the roll out of Universal Credit is taking institutionalised poverty to ever more nightmarish depths. However, the viability of his alternative must be accepted on faith and he offers no real assessment of the harsh realities that threaten his schemes. Even less does he consider why the basic income policy he so ardently proposes as a socially just corrective has won the support of so many right wing thinkers and champions of neoliberal capitalism. 

Neoliberal Basic Income

Such formidable ideological pioneers of neoliberalism as Friederich Hayek and Milton Friedman supported basic income. Over the years and, to an increasing degree more recently, a veritable capitalist cheering section for the policy has developed. Silicon Valley billionaires stand out as particularly enthusiastic proponents. Richard Branson has incorporated the idea into his self serving notions of ‘enlightened capitalism.’ Guy Standing has, in fact, been brought in as a guest speaker at a gathering of the World Economic Forum at Davos to offer his views on why capitalism can wear a human face if only it will include a universal cash payment in its box of tricks. Perhaps the most clear cut articulation of conservative support for basic income comes from the notorious right wing US political scientist, Charles Murray.   He is clear that a universal payment, set too low to impede the supply of low wage workers, could be used as a way of furthering the obliteration of the welfare state, with a meagre cash payment replacing, rather than augmenting, other forms of social provision. The reduced levels of conditionality and bureaucratic intrusion that would come with basic income, are not that concerning to people like Murray, precisely because several decades of neoliberalism have created an ample supply of desperate precarious workers with little bargaining power.

Liberal and sometimes more radical BI advocates will acknowledge that such a neoliberal version exists but they will argue that the payment can be adequate enough to provide universal income security and that its implementation can be carried out in such a way as to ensure that BI complements, rather than replaces, other parts of the social infrastructure. This question, however, will not be decided according to Guy Standing’s preferences but by the balance of forces in society, domestically and internationally.

Clement Attlee’s Legacy

The obvious question is whether a left Labour government might not be able to defy that dominant international agenda and develop the kind of ‘transformative’ basic income that some hope for.  It is necessary to consider the problems such a venture would face but also to decide whether a universal cash payment is really an effective way for a Corbyn government to challenge the austerity agenda.  

People all over the world look with inspiration to the Corbyn leadership and the rejuvenation of the Labour Party. The hope is that a left led party could win power and, with the support of a strong social mobilisation, put into effect its declared intention to break with the prevailing austerity consensus. The key objectives domestically would centre on restoring and expanding the welfare state, reversing the past wave of privatisation and tilting the balance of forces between workers and capitalists, including for that part of the workforce that has been driven into precarious work. John McDonnell has suggested that the reform agenda under Corbyn could surpass that of the post war Attlee government.  How then, does the concept of basic income fit into this bold perspective?

When it comes to restoring and expanding the welfare state, the focus on a cash payment seems a curious choice. Certainly, there is a vital role for the provision of income support and it would have to be a clear priority to ensure such programmes were based on income adequacy and full entitlement, with the present forms of punitive regulation, like benefit sanctions and the work capability assessment eradicated. However, Standing’s notion that the only way forward is to set up a universal cash benefit must be questioned. The policy proposals of William Beveridge and the measures taken by the Attlee government produced, in the context of a working class upsurge, a complex and durable welfare state that was a formidable challenge for Thatcher and those who came after her. Even to this day, though horribly damaged, it has not been dismantled. A cash payment, implemented in the context of a world wide agenda of social cutbacks and privatisation, would be the flimsiest measure that could be taken.

If the issue is one of bold improvement, then surely the focus will be on restoring and expanding vital public services. The ‘commodification’ of social provision in the present period is entirely the wrong direction to move in, as ‘Universal Basic Income: A Union Perspective,’ a report issued by Public Services International, drives home powerfully. The emphasis should not be on a scatter gun infusion of cash to enable people to shop in the capitalist marketplace. The Canadian Centre for Policy Alternativeshas taken a concrete look at some of the social programmes that could be expanded here if the resources that would be claimed by a basic income payment were allocated to them. Surely, a government swimming against the neoliberal tide would make just those kinds of choices.

Peace with Neoliberalism

John Rees recently wrote an article for Counterfire in which he suggested that the Corbyn leadership finds itself in the greatest trouble in the areas where it has retreated the most. I would suggest that support for basic income also represents a retreat in an area of important social policy. There are strong and clear voices of opposition being raised on the left in the UK and among those with a very direct interest in the future of benefit systems, including Disabled People Against Cuts (DPAC). However, the way forward for the Labour Party is being pointed by Guy Standing, a hopeless liberal who thinks the capitalists will play fair if diplomatic appeals are made to their sense of enlightened self interest. He thinks the Davos set will help him appease the baser instincts a growing ‘precariat’ with a modest and very negotiable basic income. This vision of a slightly sedated neoliberalism, he passes off as social justice.

The income Standing wishes to allocate out of the tax revenues would, in fact, be a way of providing low wage employers with a subsidy that would remove pressure on them to raise wages and provide decent and secure jobs. At root, the ideas he advances are a deluded attempt to find a social policy way around the realities of austerity and exploitation as well as the need to resist in face of attack. It is a false trail that the institutions of global capitalism view with favour. It is sad, indeed, to see the Corbyn led Labour Party offering legitimacy to this neoliberal trap. 


John Clarke

John Clarke

John Clarke became an organiser with the Ontario Coalition Against Poverty when it was formed in 1990 and has been involved in mobilising poor communities under attack ever since.

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