Basic income: libertarian wedge or a plank towards a socialist future?

Photo from BasicIncome.org

In recent years, the popularity of a basic Income (BI), has grown. Fittingly, the topic has garnered thoughtful debate and analysis from across the Canadian left, including in the Summer 2016 issue of Canadian Dimension, where the concept was explored both as potential policy, but also as part of a broader philosophical and ideological discussion.

The idea of a BI is not a new one, and has its roots in the anti-poverty crusades and studies of the 1960s and ’70s, where unprecedented prosperity was juxtaposed to the millions of people living in poverty amidst plenty. This piece will offer a historical context that — while seeking to illuminate the anti-capitalist spirit behind many pro-BI motivations — agrees with political economists like Michal Rozworski who suggest that there are many pitfalls as to how a BI could be pragmatically implemented in our current economic context. 

In Canada, the substantive debut of the BI was the 1971 Senate Croll Report. Arguing that poverty was “the great social issue of our time,” the solution was BI, whereby families whose income fell below 70 per cent of the poverty line would be assisted. For each dollar such a family earned up to the line, their BI allocation would be reduced by 70 cents. This system rejected means testing, closed the welfare trap, and ended the cyclical culture of poverty. 

To those who felt a BI would inhibit laziness, Croll pointed out that nearly all poor Canadians could not work, were already working, or were involuntarily unemployed, with over half drawing no social aid and shouldering a larger proportional tax burden than the wealthy. In Croll’s view, conventional welfare programs often had a perverse effect: they gave inadequate and untimely support, prevented the poor from investing in themselves, and did little to encourage integration into society.

While no BI ultimately manifested in Canada, it was implemented as an experiment known as MINCOME from 1974-’79. It entailed a BI at 60 per cent of the low income cut-off, and a provision to only claw back 50 cents of the benefit for every dollar earned. The project was promising, but budgetary concerns and the BI’s unpopularity left its data unanalyzed by contemporary researchers. Recent analyses, however, have correlated MINCOME with an 8.5 per cent drop in hospitalization rates, with work rates falling only among women with young children and school-aged teens.

Ideological divisions

But more interesting are the ideological debates surrounding BI, especially since the concept has support across the political spectrum. This wide applicability means that much is at stake in the sort of shape a BI will take. My assertion here — even after looking at more capital-friendly iterations of a BI — is that the concept has a deep value for all those who desire a society based on social equality and economic democracy.

While libertarians like Milton Friedman have supported a BI designed to dissolve state and social systems via a single direct transfer, recent right-of-centre support has also come from former Conservative Senator Hugh Segal, who couches BI as a tool to deal with poverty, as well as cut reliance on “programs for special needs by well-paid and unionized civil servants.”

And historically, during the long Pierre Trudeau era, the Liberal Party had toyed with the idea of implementing BI, with certain cabinet ministers — Marc Lalonde first among them — seeing it as a tool to emphasize the promises of a progressive and yet still capitalist Canada. For Michael Pitfield, BI could undergird the liberal “concept of equality of opportunity,” and, if set appropriately, could virtually abolish poverty without burdening the wealthy, whose “managerial and entrepreneurial leadership” must continue to be rewarded. Trudeau himself would focus in on the broad potential appeal and efficiency of a BI: “Everyone who was somewhat progressive at the time wanted the guaranteed annual income, so imagine creating [a] system to integrate all of this.”

But more common from Liberals was the worry over BI’s expense, as well as its propensity to erode a work ethic. In the end, the party rejected the BI as unaffordable, as an attack on the working poor’s social position, and as a message to society that work for work’s sake was no longer a desirable social outcome. 

Socialist vs capitalist visions

So while those on the right and centre had supported the BI to stabilize a capitalist order by weakening social systems, the NDP during the Trudeau years championed the BI as integral to a socialist Canada. An NDP BI would be set at the poverty line, and would be combined with new programs to address poverty’s non-monetary dimensions. This multi-pronged approach was essential to what some deemed a “socialism of the seventies.”

Based on party philosophy and rising technological unemployment, the NDP held that dignity need no longer require a job, and even high minimum wages failed to address precarity. Thus, the party advocated the BI as preparation for an automated world and, as Giles Endicott suggested, a socialist future:

The major intent is to bring about the economic basis which supports a spirit of socialism. … It is difficult to speak of such things as brotherhood, cooperation and the abolition of class without an apologetic nod towards the ‘realists’ in the party. But it remains the party’s aim to make some social as well as administrative changes. Wage labour, the master-servant relationship, class differences, income disparities and a market-based value system must all go in the long run. And the long run in practice is a series of short runs.


Similarly, and by invoking the Regina Manifesto, Ed Broadbent insisted that Canada should transcend the welfare state, in part by instituting BI, “the single most effective and efficient means of attacking … both material and spiritual poverty.” He rejected the fear that people would become moochers, because most wished to contribute to humanity’s betterment as equals, not charity cases.

Ultimately, the goal for an NDP BI was to see rights transcend their negative 18th-century roots. As historian Penny Bryden has noted, the NDP BI differed from right-of-centre iterations because it was less about bureaucratic efficiency and more about affirming the ”responsibility of government to provide social benefits as a universal right.”

It is in this vein that I think a progressive BI must take shape. But a BI as imagined by many today fails to recognize freedom from poverty as a central human right, and perhaps more importantly, fails to combine the provision of a BI with broader questions of who owns societal means of production and distribution. 

My fear is that a BI cheque alone will fail to engender economic democracy in Canada, and may even weaken it. Conversely, my hope is that the BI, taken not in isolation but as a general drive to democratize the economy, can be a boon to a post-capitalist Canadian future.

Christo Aivalis, a member of the CD web committee, is an adjunct professor of history at Queen’s University. His dissertation examined Pierre Trudeau’s relationship with organized labour and the CCF-NDP, and has been accepted for publication with UBC Press. His work has appeared in the Canadian Historical Review, Labour/le Travail, Our Times Magazine, Ricochet and Rankandfile.ca. He has also served as a contributor to the Canadian Press, Toronto Star, CTV and CBC. His current project is a biography of Canadian labour leader A.R. Mosher.

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