USBIG NEWSLETTER VOL. 5, NO. 25, JANUARY-FEBRUARY 2004

 

This is the Newsletter of USBIG, (http://www.usbig.net) a network promoting the discussion of the basic income guarantee (BIG) in the United States--a policy that would unconditionally guarantee a subsistence-level income for everyone. If you'd like to be added to or removed from this list please email: Karl@Widerquist.com.

 

TABLE OF CONTENTS

 

1. BRAZIL INTRODUCES BASIC INCOME GUARANTEE

2. THIRD USBIG CONGRESS MEETS IN WASHINGTON, DC THIS WEEKEND

3. RECENT ARTICLES ON THE BASIC INCOME GUARANTEE

4. RECENT EVENTS

5. BIG NEWS FROM EUROPE

6. NEW DISCUSSION PAPERS

7. VAN PARIJS'S ACCOUNT OF THE SIGNING OF THE NEW LAW INTRODUCING BIG IN BRAZIL

8. NEW LINKS

9. LINKS AND OTHER INFO

 

 

1. BRAZIL INTRODUCES BASIC INCOME GUARANTEE

 

The Federative Republic of Brazil has become the first national government to introduce a basic income guarantee. On January 8th, 2004, President Lula signed a law decreeing the gradual introduction of a universal basic income for all Brazilian residents. The phase-in will begin in 2005, starting with those most in need by consolidating existing federal income support programs. Many of the details are yet to be worked out, but the bill was signed as it was originally proposed before both the Senate and the Chamber of Deputies by Senator Eduardo Suplicy (who has fought for BIG in the Brazilian Congress for the last 15 years). Philippe Van Parijs, who came from Belgium to attend the signing said, "A real 'day of glory' this was for Eduardo (Suplicy) and, by the same token, for basic income - even though the road is likely to be still long and tortuous from the expanding means-tested income support scheme to a universal citizen's income." Senator Suplicy will discuss the details of the new law at the USBIG Congress in Washington, DC at 4pm on Saturday Feb. 21. For additional details see PHILIPPE VAN PARIJS'S ACCOUNT OF THE SIGNING OF THE NEW LAW INTRODUCING BIG IN BRAZIL, reprinted from BIEN as item 8 below.

 

 

2. THIRD USBIG CONGRESS MEETS IN WASHINGTON, DC THIS WEEKEND

 

The Third Congress of the U.S. Basic Income Guarantee Network:

World Reform on the Alaskan Model?

Co-sponsored by the Citizen Policies Institute

The Capital Hill Hyatt, Washington, DC, February 20-22, 2004

 

While politicians on Capitol Hill argue about toughening the conditions for TANF recipients, social scientists meeting at the Capitol Hill Hyatt will discuss how Alaska and Brazil have found a way to move out of the old, conditional welfare paradigm. The Alaska Permanent Fund distributes a share of Alaskan oil revenues to every state resident in the form of a basic income guarantee. Everyone gets the same share--rich and poor benefit alike--but this modest guarantee gives the poor a small but badly needed cushion. The program has proven so successful that Alaskans are seeking to expand it and economists are looking at it as a possible solution for the "resource curse" in countries like Nigeria and Iraq. The Brazilian Federal government announced in January that it will begin phasing-in a basic income guarantee starting in 2005.

 

Can this strategy be a model for reform for federal anti-poverty programs in the United States? Is it economically feasible? What are the costs in taxes and economic efficiency? What are benefits in equality and poverty reduction? Does it conflict with or promote other values important to democracy? These and other questions will be addressed at the Third USBIG Congress to be held in conjunction with the 2004 Eastern Economics Association annual meeting in Washington, DC, February 20-22. Presentations will address issues such as the economics of poverty, an Alaska-style oil dividend for Iraq, whether resource rents can fund an adequate income guarantee, whether a guaranteed income or a guaranteed job would be part of an efficient anti-poverty strategy, and ethical issues of unconditional redistribution of property.

 

Featured speakers include:

JAY HAMMOND, Former Governor of Alaska, political father of the Alaska Permanent Fund

EDUARDO SUPLICY, Member of the Brazilian Senate, sponsor of the new law introducing a basic income guarantee in Brazil

PHILIP WOGAMAN, Foundry United Methodist Church, author of Guaranteed Annual Income: The Moral Issues

STANLEY ARONOWITZ, Professor of Sociology at the City University of New York, Green Party Nominee for New York Governor 2002, author of “Post Work” and “the Jobless Future.”

 

Information about registration is on the web at: http://www.usbig.net, and registration will be available at the Capitol Hill Hyatt beginning Thursday evening, Feb. 19.

 

 

3. RECENT ARTICLES ON BIG

 

LENDING A LASTING HAND: ECONOMISTS OF MANY STRIPES ARGUE THAT POOR PEOPLE AND THE UNEMPLOYED NEED MORE HELP FROM THE GOVERNMENT

David Glenn, Chronicle of Higher Education, January 16, 2004

This in-depth feature article discusses three different strategies for social reform: the basic income guarantee as proposed by Philippe Van Parijs, the employer of last resort as proposed by Mat Forstater and L. Randall Wray, and wage subsidies as proposed by Edmund Phelps. It is well-rounded and well-researched and includes quotes taken from interviews with the researchers who proposed them and other experts including skeptics of all three plans.

 

COMBATING THE NATURAL RESOURCE CURSE WITH CITIZEN REVENUE DISTRIBUTION FUNDS: OIL AND THE CASE OF IRAQ

By Thomas I. Palley, Foreign Policy in Focus.

This article discusses an Alaska-style oil dividend as a solution to poverty and instability in Iraq. It's on the web at: http://www.fpif.org/papers/ordf2003.html.

 

UNEMPLOYMENT AND POVERTY - NEED FOR ACTION: ECONOMIC PROPOSALS TO HELP PEOPLE AT THE BOTTOM

Yan Liang, The Kansas City Aurora, January 19, 2004

This newspaper article reports on Glenn's article in the Chronicle of Higher Education.

 

INTERVIEW WITH DAVID GLENN ON CHANGESURFER RADIO

James "Dr. J." Hughes interviews David Glenn about his recent article "Lending a Lasting Hand," in the latest issue of the Chronicle of Higher Education. All episodes of Changesurfer are available on the web at: http://www.changesurfer.com/eventhorizon/.

 

SEPARATING SURVIVAL FROM WORK: THE QUEST FOR A GUARANTEED INCOME Jim Smith, the L.A. Labor News.

The story is a left-leaning history of the guaranteed income movement. It discusses the '60s movement which was promoted on the left by thinkers such as Robert Theobald and on the right by economists such as Milton Friedman. And it discusses the revival of the idea in the United States in the mid-'90s with Aronowitz and DiFazio's book, "The Jobless Future." For a direct link to the story go to: <http://www.lalabor.org/GAI.html>. For the L.A. Labor news website, go to: (http://www.lalabor.org).

 

U.S. SOCIALIST PARTY PLATFORM ENDORSES BIG:

The 2004 economic platform of the U.S. Socialist party contains an endorsement of BIG, "The Socialist Party stands for a fundamental transformation of the economy, focusing on producing for need not profit, with the goal of a new society without social classes, and without exploitation based on class, race, or gender. We call for a minimum wage of $12 an hour, indexed to the cost of living. We support the provision of a livable guaranteed annual income for those outside the work force." The platform is on the web at:

http://sp-usa.org/about/platform/economics.html

 

A CITIZEN'S INCOME. A FOUNDATION FOR A SUSTAINABLE WORLD

Lord, Clive, Jon Carpenter, 2003. (Author's address: <clive.lord@lineone.net>)

"Clive Lord has been advocating a universal basic income for over three decades. He was instrumental in getting the British Ecology Party to become Europe's first political party to include it in its programme, shortly after its foundation in 1973. In this very accessible book, he argues for basic income from a committed Green perspective. After a broad diagnosis of the predicament of "Space capsule Earth" and before an analysis of the political prospects for a Green party in the UK, Lord present basic income as a central tenet in a "strategy of ensuring security in basics, and encouraging initiative (or competition) for anything else", thereby "giving both sides of the old political spectrum most of what they want"." -BIEN

 

MINIMUM INCOME SCHEMES IN EUROPE

Standing, Guy ed., Geneva: International Labour Office, 2003 (http://www.ilo.org/public/english/protection/ses/index.htm)

"A substantial collection of scholarly essays presenting a critical analysis of the working of existing means-tested minimum income schemes in individual countries (Serge Paugam and Nicolas Farvaque & Robert Salais on France, Alfredo Bruto da Costa on Portugal, David Benassi & Eneo Mingione on Italy, Simo Aho & Ilkka Virjo on Finland, Ive Marx and Anna Cristina D'Addio & al. on Belgium, Manos Matsaganis on Greece, Sean Healy & Brigid Reynolds on Ireland), presceded by an introduction by Guy Standing and a cross country comparison by Bea Cantillon & al. Most of the contributions point to the limits intrinsic to means-tested strategies for tackling poverty, and one of them (by Healy and Reynolds) shows explicitly how debate on these limits led to an active public discussion on basic income." -BIEN

 

A BASIC INCOME GRANT FOR SOUTH AFRICA

Standing, Guy & Samson, Michael. (Juta Academic Publishers), 2003, 152p.

"Edited by Guy Standing (ILO and co-chairman of BIEN) and Michael Samson (Director of Research for Cape Town's Economic Policy Research Institute), this is the most comprehensive book so far on the basic income proposal for South Africa, with contributions by both proponents and critics. It includes introductory comments by Zwelinzima Vavi, General Secretary of COSATU (South Africa's Trade Union Confederation), Sheena Duncan, Patron of the Black Sash (an influential women's group) and Archbishop Njongonkulu Ndungane (Church of the Province of Southern Africa) and a final chapter by Neil Coleman, co-ordinator of the COSATU Parliamentary office. In addition to acknowledging COSATU's key role in raising awareness and fostering research into the possibility of a universal social grant ever since 1998, the book.  <Sngobeni@juta.co.za>, <http://www.juta.co.za> and International Labour Office (http://www.ilo.org/public/english/protection/ses/index.htm)" -BIEN

 

 

4. RECENT EVENTS

-From BIEN

 

SOWETO (ZA), 2-4 December 2004: Reducing Inequality and Poverty : A BIG Solution

Conference held in Soweto, at the Ipelegeng Community Centre, with the participation of several hundred people, including representatives of many non-government organisations, a senior policy specialist from President Mbeki's Office, ILO Director Guy Standing and Brazilian senator Eduardo Suplicy. A few days earlier, a conference organised in Johannesburg by the women's group Black Sash and the BIG Coalition, focused on the options for financing a basic income in the country.

For further information: Karen Kallman <kkallman@blacksash.org.za>

 

BARCELONA (ES), 10 December 2003: 3rd SYMPOSIUM OF THE RED RENTA BASICA

The third conference of Spain's national network on basic income took place at Barcelona's Pompeu Fabra University. A detailed account of it (in Spanish) by Alex Boso and Irkus Larrinaga was published in the most recent issue of the network's newsletter, RRBFlash Número 11, Año II, diciembre 2003, which can be obtained from rrbflash@redrentabasica.org. It is also possible to unload the recording of all presentations and many photographs from http://www.redrentabasica.org .

For further information: <secretaria@redrentabasica.org>.

 

 

5. BIG NEWS FROM EUROPE

-From BIEN

 

GERMANY: UNDERGROUND POSTER CAMPAIGN PAYS OFF

Posters arguing for an unconditional universal basic income under the title "Freedom instead of full employment") were spread on the walls of Frankfurt's underground stations in November 2003 and some of them survived there for several weeks. According to the account of the initiators, the campaign triggered many reactions, not least in the form of graffiti and counter-graffiti on the posters themselves. The local newspaper Journal Frankfurt published an article on the campaign, and the organisers have been invited to take part in a TV programme (3SAT). An interview is also being planned in the national green-leaning daily newspaper TAZ.

For more details (including some of the most interesting graffiti), see

Contact: Sascha Liebermann <S.Liebermann@freiheitstattvollbeschaeftigung.de>

 

SPAIN: BASIC INCOME  IN THE PROGRAMME OF CATALONIA'S NEW GOVERNMENT

After the November 2003 regional election in Catalonia, a left coalition government was formed, the fist one since Catalonia was granted autonomy after the end of Franco's regime. It consists of three components: the social-democratic party, the left independentist party Esquerra Republicana de Catalunya, and a left party consisting of greens, communists and other leftists. Point 5.5 on the new government's programme reads: "To redefine the Minimum Insertion Income [the existing means-tested minimum income scheme on the pattern of the French RMI) so that it becomes a citizen's Basic Income, studying different proposals for its gradual implementation." Some MPs and prominent members of the parties that form the new government are members of the Red Renta Básica, Spain's basic income network. In May 2002, Carme Porta (Esquerra Republicana de Catalunya) and José Luis López Bulla (Iniciativa per Catalunya Verds) alreasy presented a draft law for implementing Basic Income in Catalonia. For further information: Daniel Raventós <ravento@eco.ub.es>

 

 

6. NEW DISCUSSION PAPERS

 

The USBIG Discussion Paper Series is an interdisciplinary working paper series that posts works in progress about or relating to BIG to promote discussion of the issue and to provide feedback for the authors. Many of the new discussion papers will be presented at the USBIG Congress in Washington, DC.

 

DISCUSSION PAPER # 65, DECEMBER 2003: "ECONOMIC POSSIBILITIES OF OUR GRANDPARENTS"

Karl Widerquist

ABSTRACT: John Maynard Keynes, one of the most influential economists of the Twentieth Century, published "Economic Possibilities for Our Grandchildren" in 1930, when the world was in the grip of the Great Depression, but the essay bypassed the depression (which Keynes dealt with extensively elsewhere) to focus instead on a much longer outlook-the state of the world in the time of his grandchildren. He predicted that the trend of exponential economic growth would resume after the great depression, and that it would increasingly free workers from the struggle for subsistence, freeing more and more of their time for other pursuits. Looking back from 2004 shows that Keynes was right about economic growth, but wrong about its effects on workers' time. This article examines why.

 

DISCUSSION PAPER # 66, JANUARY 2004: EMERGENCE AND DEFEAT OF NIXON'S FAMILY ASSISTANCE PLAN

Leland Neuberg

ABSTRACT: In 1969 the Nixon Administration proposed to reform welfare with a negative income tax (NIT) that made none of those on welfare worse off in income terms. Three years of intense Congressional struggle ensued at the end of which the Nixon welfare reform proposal died.  However, within four years an Earned Income Tax Credit (EITC) became law.  This paper focuses primarily on Congressional debate and maneuvers, and Administration actions, during 1969-1972 to try to understand why Nixon proposed an NIT and what killed it.

 

DISCUSSION PAPER # 67, JANUARY 2004: THE CASE AGAINST INCOME INEQUALITY: UNEQUAL INCOME IS UNEQUAL CITIZENSHIP

Pete Farina

 

DISCUSSION PAPER # 68, JANUARY 2004: DOES EVERYONE HAVE A RIGHT TO A BASIC INCOME GUARANTEE

Allan Sheahen

ABSTRACT: Today, we take for granted rights which took decades of hard fighting to obtain: the right to free speech; the right to religious freedom; the right to vote; the right to free public education.  Most western nations even provide the right to free health care. But what about the right to a basic minimum income? Is it a pipe dream?  Is it politically possible? Is it right? The idea is not new.  It's as old as history, itself. The Bible, the French Constitution, the United Nations, and dozens of other commissions, scholars, and economists support the idea of a basic income. I believe there is a moral obligation to provide every man, woman and child with a decent level of living.  A person's right to be -- the right to simple existence -- is not something for others to grant or withhold as an economic carrot, or to give as a gift.  It's a universal right. If men and women are inherently irresonsible bums, the basic income guarantee is the most stupid idea anyone has come up with.  But if we believe that humans can become responsible, then a basic income guarantee may be the only thing that will lead us into a freer society.

 

DISCUSSION PAPER # 69, JANUARY 2004: A CALL TO ACTION AGAINST POVERTY

Carla Theodore

 

DISCUSSION PAPER # 70, JANUARY 2004: GREEN CAPITALISM

George McGuire

 

DISCUSSION PAPER # 71, JANUARY 2004: BIG MEDICINE FOR ACHIEVING POPULATION HEALTH IN THE U.S.

Stephen Bezurchka

ABSTRACT: The United States today is less healthy, compared to other rich nations, today than it was 50 years ago.  We are so unhealthy so that if we eradicated all deaths from our number one killer, heart disease, we still wouldn't be the healthiest country in the world.  The reason for this decline is not our health care system, we spend half of the world's medical care bill in the USA.  The key reason is the existence of so much poverty in the richest and most powerful country in world history.  In the last 40 years our income gap has increased dramatically.  The gap between the rich and the poor has been shown to be the critical determinant of a population's health.  Among all rich countries, we have the most child poverty, the highest teen birthrate, the highest child abuse death rate, the lowest life expectancy, and the lowest voter-turnout.  The medicine we need to treat the American population is related to decreasing the gap between the rich and the poor.  A basic income guarantee is one way to achieve this.  The story of our health decline, the determinants of population health, and the kinds of population medicine needed will be presented. BIG would decrease the gap between the rich and poor in the US and benefit us all, not just the poor.

 

DISCUSSION PAPER # 72: THAT WE MAY KNOW WHAT WE WANT: TOWARD AN ARGUMENT FOR A BASIC INCOME GUARANTEE BASED ON DELIBERATION, FEBRUARY 2004

Jason Murphy

ABSTRACT: Arguments about the ethical politics of a basic income guarantee run generally along communitarian, liberal, republican, and utilitarian lines. This work seeks to add a new sort of justification for a basic income guarantee (BIG), stressing the role it would play in promoting deliberative capabilities. Deliberation is a component of practical reasoning. This is to say: if you are interested in X, you should be interested in deliberation about X. This entails an interest in deliberation whereby one's point of view and alternate candidates are defended and criticized in different venues. BIG promotes these capabilities by enabling more people to use their resources to pursue deliberation if they wish and as a means of securing non-domination, equality, and publicity-thus enabling and promoting conditions of deliberation. This piece ends with a survey of some of the advantages posed by this deliberative approach.

 

DISCUSSION PAPER # 73: UNCONDITIONAL BASIC INCOME: A BASIC CONDITION OF A BETTER SOCIETY?

Eri Noguchi and Michael A. Lewis

ABSTRACT: In this paper, the notion that providing a basic income guarantee might promote greater civic participation is explored.  One benefit of the basic income guarantee might be that it would allow for greater civic participation, not only in the way of greater voter turnout, but more locally, in the way of greater voluntarism, greater involvement in local civic associations and neighborhood initiatives, greater participation in local political clubs and school boards, and, perhaps most importantly, a greater and deeper awareness and understanding by the general public of the political issues that affect their lives, which is often a by-product of active political involvement.  In economic terms, providing people with a basic income might increase their propensity to allocate more of their time to leisure rather than labor, and, within that leisure time, to dedicate more time to a civic activity.

 

DISCUSSION PAPER # 74: ON SOME UNAPPRECIATED IMPLICATIONS OF BECKER'S TIME ALLOCATION MODEL OF LABOR SUPPLY, FEBRUARY 2004

David Wetzell

ABSTRACT: The first paper demonstrates that the time-allocation generalization of labor supply can generate interesting and surprising predictions regarding labor supply behavior.  These predictions follow from the assumptions made about input combinations available for final consumption.  When goods cannot be produced strictly from time or money then either input could curtail the substitution effect.

 

DISCUSSION PAPER # 75, FEBRUARY 2004: WHAT ROLE DOES IDENTITY PLAY IN THE PREFERENCE FOR INCOME REDISTRIBUTION?

Louise C. Keely and Chihi Ming Tan

ABSTRACT: Does identity play a role in determining an individual's preferred level of income redistribution? Identity takes on many dimensions - which are salient? Using the data from the General Social Survey, we provide a stylized fact that preferences over redistribution in the United States vary across specific identity groupings related to race, gender, and class. Our empirical results provide guidance for evaluating theoretical treatments of identity and policy preferences. We find that, although identity may play a role in determining preference structures, that does not fully explain our results. Our results are more consistent with a theory in which identity provides information to agents.

 

DISCUSSION PAPER # 77, FEBRUARY 2004: ON THE WELFARE EFFECTS OF A WAGE FLOOR IN A TWO-SECTOR LABOR MARKET

David Wetzell

ABSTRACT: That a wage floor, such as the minimum wage, lowers employment has been extensively empirically confirmed.  However, among poorer workers the relatively inelastic nature of labor demand may permit an increase in the minimum wage to have a positive wage spill-over into the uncovered sector if covered sector employees' need to "moon-light" in the uncovered sector is reduced.  The model indicates that wage floors may be a more appropriate instrument for reducing poverty when workers are impoverished and also affirms the need to empirically test for their impact on the income and hours worked by directly and indirectly affected workers.

 

DISCUSSION PAPER # 78, FEBRUARY 2004: FREEDOM AS THE POWER TO SAY NO

Karl Widerquist

ABSTRACT: The word freedom is used in two different ways: as a continuum of allowances (the stop light reduces Bob's freedom) and in a status sense (the pardon gives Bob his freedom). My concern here is with the status sense of freedom: the distinction between the status of a free individual and the lack of that status. This paper proposes the definition of a free person: A free person has the power to make or to refuse social interaction with other willing people. It makes five basic points: 1. A person is free when she has control over her own life. That is, her interactions with others are both voluntary and unforced: "Effective control self-ownership" (ECSO). 2 Interaction is unforced when all parties are able to decline interaction: ECSO freedom entails the power to say no. 3 The power to say no requires an acceptable default option: The power to say no requires independence. 4 For most people, freedom as independence is largely satisfied by freedom from specific interference by others. 5 ECSO Freedom is important to social justice because the absence of unnecessary force is a good in its own right, because it ensures that interaction is actually voluntary, and because it helps to make sure that interaction is mutually beneficial, fair, and reasonable. The paper concludes with a comparison of freedom as the power to say no with other theories of or involving freedom.

 

 

7. NEW LINKS

 

THE MARTIN HATTERSLEY HOMEPAGE

Martin Hattersley, a proponent of Social Credit, has a website with several good articles on the National Dividend, the Social Credit variant of BIG, linking it both to the money system and to landownership. http://home.edmc.net/~martinh/

 

8. PHILIPPE VAN PARIJS'S ACCOUNT OF THE SIGNING OF THE NEW LAW INTRODUCING BIG IN BRAZIL

This was a truly extraordinary event. Overlooking the world-famous Praça dos Tres Poderes designed by Oscar Niemeyer, the ceremonial room of the President's Palacio do Planalto was gradually filling with journalists, photographers, TV crews, ministers and other political dignitaries. Facing the swelling audience, four empty chairs. And behind them, a large wall covered by colourful smiling faces of all ages and races, alternating with an inscription in large letters: "RENDA BÁSICA. Cidadanía para todos" (Basic income. Citizenship for all").

An off voice announced the arrival of the President, and the crowd went quiet, as Luiz Inacio Lula da Silva and his wife Marisa sat down. By their side, the Ministro da Casa Civil (Brazil's de facto Prime Minister) José Dirceu, and Federal Senator Eduardo Matarazzo Suplicy, Lula's only opponent in the Worker's Party's presidential primaries and author of the law proposal which the President was there to sign.

Summoned by the off voice, I rose to the pulpit to indicate briefly what I saw as the world-wide significance of the event. Next was Senator Suplicy's turn, visibly moved, who briefly retraced his long fight for the introduction of a guaranteed minimum income in Brazil, eloquently recited a poem, restated the key advantages of a universal citizen's income over means-tested schemes, thanked the various Workers' Party heavyweights who had helped the proposal through the critical stages, and ended in a way that did not exactly go unnoticed in the Brazilian press, by warmly hugging the president. After ceremonially signing the law, Lula paid homage to the determination of his old comrade, whom he described as the inexhaustible Don Quixote of minimum income, while warning that there was no magical solution to Brazil's problems and that the new law would only be introduced gradually.

Notwithstanding this presidential caution, this was definitely a "day of glory" for the very popular 62-year old Sao Paulo Senator, surrounded for the occasion by his 95-year old mother, his ex-wife and mayor of Sao Paulo Marta Suplicy, several other members of his family and many friends. A first culmination in his fight had been the unanimous adoption of his 1991 minimum income proposal by the federal Senate, never endorsed by the Chamber of Deputies. His more ambitious 2001 citizen's income proposal, instead, was approved with some amendments by the Senate in December 2002 and by the relevant commissions of the Chamber of Deputies in September and November 2003. The President had until January 2004 to either veto or sanction it. He chose the latter.

What will now happen? As initially formulated, the 2001 Suplicy proposal stipulates that, subject to it being endorsed by a national referendum in 2004, "an unconditional basic income, or citizenship income" will be introduced in 2005 for every Brazilian citizen or foreign resident for five years or more, that it will be of equal value for all, payable in monthly amounts and sufficient to cover "minimal expenses in food, housing, education and health care", "bearing in mind the country's level of development and budgetary possibilities". Two main amendments were made before unanimous approval by the senate: the idea of a referendum was dropped, on the ground that everyone would be in favour anyway, and a new article was added, stipulating that the basic citizenship income "will be realized in steps, at the discretion of the Executive, giving priority to the neediest layers of the population". It is with these two amendments that Suplicy's proposal was signed by Lula.

From the second amendment it follows, no doubt, that Brazil is bound to remain stuck for quite a while with a means-tested system. But this does not make the law meaningless. Firstly, the existence of the law makes progress easier towards a stronger integration of existing assistance schemes with one another, and towards a stronger integration of the social assistance system with both the social insurance system and the income tax system, as Brazil's federal government is henceforth legally entitled to take any number of further steps, in a financially responsible way, towards a full universal basic income.

Secondly, the long-term perspective firmly asserted in the new law should help face the powerful objections that will no doubt arise soon, as the federally funded means-tested system keeps getting more comprehensive and less stingy, and as individual and collective beneficiaries strategically adjust to its getting established. When over 50% of the active population works entirely in the informal sector, the income test needs to rely essentially on declarations of income earned by the beneficiaries. As the officials in charge of the existing income-tested Bolsa Familia system are well aware, there is no realistic way of seriously checking whether the declarations are correct. This generates a dilemma. Either one needs to be ready for major problems of arbitrariness in and resentment about local decisions of inclusion and exclusion, in particular of a clientelistic kind. Or one needs to devise more observable alternative proxies of income poverty, such as the number of light bulbs, the quality of the material used for the house or how well fed the children look, at the expense of discouraging systematically a diligent use of the modest resources poor households have.

A genuine citizen's income would get rid of theses problems in one swoop, while extending support to low-paid formal sector workers. Of course, progress towards a full-fledged basic income must be gradual - for example through turning the existing means-tested Bolsa familia and the existing income tax exemption for dependent children into a universal child benefit system that would also benefit the working families that are neither poor enough to be entitled to welfare payments (about EUR 50 per capita per month) nor rich enough to pay tax (about EUR 400 per month). Nonetheless, the objective unambiguously stated in the law offers the promise of tackling effectively the criticisms the existing means-tested schemes are bound to trigger without feeling compelled to roll them back.

To investigate the way in which the new law could influence the further development of existing programmes, Eduardo Suplicy and I had, on 7-9 January, in quick succession a long evening discussion with Jacques Wagner, Minister of Labour, and his staff; two long meetings with Antonio Palocci, Finance Minister, accompanied by two of his top cabinet advisors, and with Cristóvam Buarque, Education Minister and former Governor of the Federal District of Brasilia, where the Bolsa Escola programme was first introduced; a working lunch with Ana Fonseca, the President's Executive Secretary in charge of the new Bolsa Familia programme (which started integrating existing assistance programmes), accompanied by her staff and by Marta Suplicy, mayor of the city (Sao Paulo) in which the largest municipal assistance programme is operating; and a working breakfast with José Graziano, Minister in charge of the Zero Hunger programme.

The general picture was that there was strong sympathy for the objective, but no clear vision about how to get there and, for the time being, many other priorities. How much difference the new law will make to Brazil's protection system in the coming years is quite uncertain. Of the four ministers we saw, three (Buarque, Graziano and Wagner) were moved to other functions a couple of weeks later in Lula's government reshuffle of 23 January. Nonetheless, the signing of Senator Suplicy's law proposal was an important, indeed incredible, moment in the history of basic income. It will and should give hope and strength to many across the world who view basic income as a central component of a desirable and sustainable future for our societies.

pvp

 

The pictures of the event shown on the same evening on national TV can be accessed at

http://pop.gmc.globo.com/webmedia/pop_legado.html?player=wmv&usuario=tvgjornalismoaberto&tipo=ondemand&programa=817&path=/video/jg/20040108/CRG_mat03_high.wmv&banda=bl

Some coverage in Brazilian national papers can be downloaded from

http://www.estadao.com.br/agestado/noticias/2004/jan/08/141.htm

http://www1.folha.uol.com.br/folha/dimenstein/noticias/gd080104h.htm

http://noticias.bol.com.br/politica/2004/01/08/ult96u56994.jhtm

and more can no doubt easily be found through search engines (try "Lula", "Suplicy", "renda básica de cidadania", "projeto de lei", "8 de janeiro", etc.).

In Spanish, some coverage can be found in the Mexican "El Economista"

http://www.economista.com.mx/online4.nsf/0/59439A4A9D8769FA86256E150070F8D8?OpenDocument

An expanded version of Philippe Van Parijs's address at the ceremony was published in the Brazil's financial newspaper Valor Econômico and, in English, in South Africa's Business Day. Both versions are available from http://www.etes.ucl.ac.be/PVP/PVPInterventions.html.

For further information: <EDUARDO.SUPLICY@SENADOR.GOV.BR>

 

 

 

9. LINKS AND OTHER INFO

 

FOR LINKS TO DOZENS OF BIG WEBSITES AROUND THE WORLD, go to http://www.usbig.net, and click on "links." These links are to any website with information about BIG, but USBIG does not necessarily endorse their content or their agendas.

 

Thanks to Paul Nollen, Eduardo Suplicy, Steve Shafarman, and Martin Hattersley.

 

THE U.S. BASIC INCOME GUARANTEE (USBIG) NETWORK, which publishes this newsletter, is dedicated to promoting the discussion of the basic income guarantee (BIG) in the United States. BIG is a generic name for any proposal to create a minimum income level below which no citizen's income can fall. Information on BIG and USBIG can be found on the web at: http://www.usbig.net. If you know any BIG news; if you have any comments on the newsletter or the website; if you know anyone who would like to be added to this list; or if you would like to be removed from this list; please send me an email: Karl@Widerquist.com.

 

As always, your comments on this newsletter are gladly welcomed.

 

Thanks,

-Karl Widerquist, coordinator, USBIG.