This was posted on October 21, 2014.
This talk was given at a local TEDx event, produced independently of the TED Conferences. Rutger Bregman (1988) studied at Utrecht University and the University of California in Los Angeles, majoring in History. In September 2013 Bregman joined the online journalism platform De Correspondent. His article on basic income was nominated for the European Press Prize and was published by The Washington Post.
The solution we require is to empower EVERY citizen as an owner to meet their own consumption needs with government becoming more dependent on economically independent citizens, thus reversing current global trends where all citizens will eventually become dependent for their economic well-being on our only legitimate social monopoly –– the State –– and whatever elite controls the coercive powers of government.
A “basic income,” or “citizens dividend,” or “free money” (which is obtained through redistributive taxes and/or national debt) overseen and controlled by the coercive powers of government will not abate further ownership concentration of capital asset wealth (produced by technological invention and innovation) Instead, we should provide and assure REAL equal opportunity for EVERY citizen to acquire personal ownership in FUTURE capital assets, simultaneously with the growth of the economy.
The “basic income” would subject private property rights to coercive government control with the power to appropriate the earnings produced by capital assets owned by individuals.
The fundamental sickness afflicting the system is that real upward economic opportunity is exclusive, and restricts broadening productive capital asset growth to ONLY those in the population who have meaningful “past savings” or equities to secure the financing for FUTURE capital asset formation. Thus, those with “money,” that is the wealthy ownership class, constantly invest and re-invest that which they do not need for product and service consumption uses. Thus, they constantly are acquiring more and more capital asset wealth, which produces income for its owners.
Rather than reform the system, the political machine has opted to finance the industrial-military complex and social welfare programs using national debt, which is creating enormous budget deficits, which now exceeds $17 trillion (http://www.usdebtclock.org/). This continuing debt scenario is not sustainable.
In an economy, production and consumption are interdependent. The purpose of production is consumption. In a free market economy, such as the U.S., the distributive principle is “to each according to his production.” The problem of anemic growth is that ONLY a minority of already wealthy people are producing through their privately-owned capital assets, while the vast majority of the population is shackled to stagnate jobs or dependent on redistributive taxpayer and debt-supported government welfare as their ONLY means of an income. Those dependent on a JOB are constantly subject to insecurity due to on-going tectonic shifts in the technologies of production, which eliminate jobs and devalue the worth of labor.
Technological change makes tools, machines, structures, and processes ever more productive while leaving human productiveness largely unchanged (our human abilities are limited by physical strength and brain power––and relatively constant). The technology industry is always changing, evolving and innovating. The result is that primary distribution through the free market economy delivers progressively more market-sourced income to capital owners and progressively less to workers who make their contribution through labor. Yet without income distribution to the market majority there can be no market growth as there will be fewer and fewer “customers with money” to demand and purchase the products and services increasingly resulting from technological invention and innovation.
In a democratic growth economy, based on binary economics (rather than the one-factor JOBS ONLY paradigm), the ownership of capital would be spread more broadly as the economy grows, without taking anything away from the 1 to 10 percent who now own 50 to 90 percent of the corporate wealth (until death, at which time it would be subject to a transfer tax imposed on the recipients whose holdings exceeded, for example $1 million). Instead, the ownership pie would desirably get much bigger and their percentage of the total ownership would decrease, as ownership gets broader and broader, benefiting EVERY citizen, including the traditionally disenfranchised poor and working and middle class. Thus, productive capital income would be distributed more broadly and the demand for products and services would be distributed more broadly from the earnings of capital and result in the sustentation of consumer demand, which will promote economic growth. That also means that society can profitably employ unused productive capacity and invest in more productive capacity to service the demands of a growth economy.
According to binary economist Louis O. Kelso: “When consumer earning power is systematically acquired in the course of the normal operations of the economy by people who need and want more consumer goods and services, the production of goods and services should rise to unprecedented levels; the quality and craftsmanship of goods and services, freed of the cornercutting imposed by the chronic shortage of consumer purchasing power, should return to their former high levels; competition should be brisk; and the purchasing power of money should remain stable year after year.”
Without this necessary balance hopeless poverty, social alienation, and economic breakdown will persist, even though the American economy is ripe with the physical, technical, managerial, and engineering prerequisites for improving the lives of the 99 percent majority. Why? Because there is a crippling organizational malfunction that prevents making full use of the technological prowess that we have developed. The system does not fully facilitate connecting the majority of citizens, who have unsatisfied needs and wants, to the productive capital assets enabling productive efficiency and economic growth.
Kelso said, “We are a nation of industrial sharecroppers who work for somebody else and have no other source of income. If a man owns something that will produce a second income, he’ll be a better customer for the things that American industry produces. But the problem is how to get the working man [and woman] that second income.”
There are solutions to achieve that objective such as the proposed Capital Homestead Act (http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/).
