Leading the People to Utopia through Universal Basic Income?: a review of Rutger Bregman’s Utopia for Realists

 
by Chris Gilligan
 

Rutger Bregman, Utopia for Realists: And How We Can Get There. London: Bloomsbury, 2017 (hbk), 2018 (pbk)

 
Utopia for Realists is one of a number of recent books, that makes the case for Universal Basic Income (UBI). At the heart of the arguments for UBI is an acknowledgement that capitalism is not working for millions of people, and a proposal to make capitalism more caring for those at the bottom. Bregman, and other proponents of UBI, do appear to be well intentioned. They want a more caring capitalism. The problems that UBI seeks to address, however, are systemic and cannot be overcome within capitalism as a social system.

 
Bregman’s Praise for and Critique of Capitalism

Bregman is a man of the Left. He recognises that there are problems with how capitalism operates. He points out, for example, that capitalism generates lots of ‘bullshit jobs’, such as in financial services, that are generously financially rewarded, but are parasitic on society (Chapter 7). He points out that many jobs which are not generously rewarded, such as refuse collection, are socially useful. He argues that the labour market should be reorientated toward usefulness as the guiding principle (but he never asks why capitalist production is driven by production for exchange, rather than for the usefulness of the goods and services produced). He makes the case for people being freed up to realise their potential. He argues, for example, that giving people sufficient income to live on frees them from worry and leads to better quality relationships with family, friends and loved ones (Chapter 3).

He also argues for open borders as a means to overcome global inequality, on the grounds that migrant remittances are more effective than foreign aid at promoting development in the global South (Chapter 9). And he argues that a caring capitalism would be a more efficient capitalism. He points to examples where generous and unconditional handouts were used by homeless people to get themselves back into the housing and labour markets, and says that the savings on healthcare and policing resources made these initiatives cost-effective (Chapter 2).

However, Bregman’s underlying conception of capitalism is of a system that can work for the whole of humanity; much of the first chapter is devoted to praising capitalism for lifting billions out of poverty. He points out that, since the industrial revolution, there have been immense material gains for humanity in terms of health, education and a vast array of consumer goods that are now produced in the global capitalist economy. This increase in the material wealth of society, he argues, would be inconceivable to people living in pre-capitalist society. He points out that, in spite of this material wealth, humanity is afflicted by psychological dissatisfaction. Widespread anxiety is part of the zeitgeist of the twenty-first century, and there is a tangible sense that the world is facing apocalypse. So, for Bregman, the problem is not with capitalism as such, but with the way that it is managed.

Bregman, like many others on the reformist left, views the problem as lying in the sphere of circulation, not in production. The problem, as he sees it, lies in how the vast wealth generated in society, and societies resources more broadly, are distributed. Insofar as he examines at how wealth is produced in a capitalist society, he only looks at the technological aspect of production; he never examines the social relations of production.

Bregman views technological change as both something that creates the basis for a new approach to organising society, and as something that makes this new approach necessary (Chapter 8). He notes that the anticipated ‘new industrial revolution’, which the microchip and automation promise to deliver, will allow more to be produced with less input from human labour. This technological change could free up humanity to enjoy more leisure time and make work more fulfilling, or it could produce mass unemployment and create a huge reservoir of dissatisfaction. To avoid the social turmoil that mass unemployment could create, he argues, capitalist societies need redistribution—of income, labour-time, and tax burdens. He argues for UBI as a means to redistribute income; for a shorter working week as a means to redistribute labour-time; and for a steeper tax on capital and an abolition of taxes on wages as means to redistribute tax burdens.

All of this sounds very new and radical, but it is a contemporary gloss on proposals that have been made before. Redistribution was a key component of the Keynesian-style policies underpinning Western capitalist economies after the Second World War. Bregman, however, never asks why Keynesian policies failed in the 1970s. The reason he never asks seems to be that he is judging capitalism by the moral worthiness of the social outcome, rather than trying to understand what it is about capitalism, as a system of organising production, that creates the problems he has identified.

 
UBI: Caring Capitalism Against the Small-State Ideologues

The basic idea behind UBI is to give a subsistence level of money to everyone, as a matter of right, without conditions, for the whole of their lives. Bregman says that this idea may sound utopian, and most of his book is devoted to trying to demonstrate that the idea is actually practical, workable and necessary. He provides examples, from all over the world, where ‘free money’ handouts have given people independence and helped to tackle poverty. In all of the cases Bregman cites, the lives of the majority of people improved. So how could anyone possibly object?

One reason why people object, Bregman suggests, is that they just don’t know the evidence. His book aims to win over these people, by providing the evidence. Another reason why people object, he suggests, is that some of them are ideologically blinkered and don’t care about the fate of other human beings. For example, Bregman points out that, in the early 1970s, US President Richard Nixon proposed the addition of UBI provisions to the ‘War on Poverty’ measures that his administration inherited when he succeeded Lyndon B Johnson. However, Nixon ultimately dropped this proposal.

Bregman argues that the UBI provisions were scuppered by Martin Anderson, one of Nixon’s economic advisers, who was an admirer of the late Ayn Rand (a guru of many libertarians and conservatives on the American Right today). Anderson argued that historical examples showed that ‘free money’ schemes don’t work, and that welfare schemes should be punitive—in order to encourage ‘individual independence’, rather than ‘welfare dependence’. Since the 1970s, governmental welfare programs throughout the industrialised West have become increasingly limited in scope, punitive in nature, and difficult to access. In Bregman’s telling of the history of UBI in the US, there was the possibility for a more progressive approach to welfare in the 1970s, but this possibility was crushed by right-wing ‘small-state’ ideologues.

Thus, Bregman differentiates between (1) decent people who just don’t know the evidence, but would support UBI if they did know; (2) the enlightened ones (like him) who’ve seen the evidence and will educate others; and (3) the nasty people who either put their ideological convictions before the needs of humanity, or who don’t really care about the fate of the poor.

We have already noted that, in all of the cases Bregman cites, the lives of the majority of people improved. So, how could anyone possibly object? One reason they could object is that Bregman has selectively chosen cases which best fit the argument that he wants to make, and he has portrayed these cases in ways that support his arguments. Bregman’s rush to blame ideologues for the failure to roll-out UBI schemes in the past allows him to avoid investigating other possible explanations for this ‘failure’.

Why is there this gap in Bregman’s analysis? Perhaps he investigated other explanations but omitted discussion of them because, inconveniently for someone who wants to write a best-selling book, he does not have good counter-arguments. Or perhaps he has approached the issue one-sidedly, searching only for evidence that supports the case for UBI. Either way, he evades the difficult questions. Bregman never seriously entertains the possibility that UBI cannot work in a capitalist society.

Studies which take a more rigorous approach to the data draw different conclusions from those arrived at by Bregman. A recent academic study of the feasibility of UBI schemes, for example, summed up one of the key criticisms of UBI in the following terms: ‘an affordable UBI would be inadequate, and an adequate UBI would be unaffordable’ (p. 43). The ‘free money’ that Bregman so generously wants to hand out has to come from somewhere, either through taxation or through borrowing. The latter only defers the problem of paying for the policy. So, at the end of the day, it comes down to taxation. Bregman wants to fund UBI by increasing taxes on corporations. But funding UBI at a level that is sufficient for recipients to live on would require such a punitive level of taxation of corporations that, unless it was introduced in every country in the world, it would lead to capital flight and other economic problems.

The issue is not just one of affordability. The relevant literature on welfare reform commonly refers to unavoidable trade-offs. As a 2006 study by a UK-based anti-poverty charity, the Joseph Rowntree Foundation (whose researchers are certainly not ‘small-state ideologues’), put it, welfare spending involves ‘a three-way trade-off between redistribution, work incentives and government costs’ (p. 2). This three-way trade-off is sometimes referred to as the ‘iron triangle’ of welfare reform.

It is beyond the scope of this relatively short review to explain the many reasons why a UBI system that is not a mere token—one that provides adequate income to everyone—is incompatible with capitalism as a system for organising production in society. In the rest of this review, we will focus on one of key issues, work incentives. In short, adequately-funded UBI is incompatible with capitalism as a system for organising production because capitalism is based on the indirect coercion of workers; and adequately-funded UBI would undermine this indirect coercion.

 
UBI and the Indirect Coercion of Workers

Bregman assumes that people want to work, and that a UBI system would provide the incentives to eradicate drudgery and free people up to do work that is fulfilling. Critics of UBI point to the problem that, if people can get a living without having to work, there is no incentive for them to work. They argue that adequately-funded UBI is ultimately self-defeating because, as people quit work, production would grind to a halt, which in turn would eliminate the corporate profits or other income needed to keep funding UBI.

Both Bregman and the critics of UBI have a point. There are many reasons why people like to work, and why they would be willing to do so even if they already had enough income to meet all of their needs. They might work because they find the activity fulfilling. (It is notable that a number of the examples that Bregman cites, of successful UBI-style schemes, involve people turning their pastime activity, such as baking cakes, into a business activity.) They might work because of the social activity that is involved in some types of work. Or they might work out of a sense of duty to other people, or to contribute to society in some way.

There are also many reasons why, under conditions of a capitalist economy, people would opt not to work if that was an option. If they turn a pastime into a business, they are put into competition with businesses in the same sector. Because of this competition, they will experience pressure to be more efficient, to produce more in less time. Some may enjoy the challenge; but most will find that whatever joy there was in the pastime in the first place will be gone. Work that is rewarding as a social activity is so because of work colleagues, not because we are contributing to society as a whole. People might engage in work as a social activity, but if they have ample opportunities for fulfilling social activity outside of work, which a UBI would free them up to explore, many would likely take that opportunity. It is possible that many people work because they want to contribute to society in some way. People who work in jobs that are thought of as vocational, like healthcare and education, sometimes say that they are doing so because they want to contribute to society. In these same professions, however, people also experience the pressure of capitalism’s alienated labour relations. Many of these workers experience work as oppressive and, if given the opportunity to avoid work that UBI would provide, they may well look for other ways to contribute to society, outside of the capitalist workplace.

Long before people were proposing UBI, Marx was aware of the issues that are raised in the discussion over UBI. In Capital, he noted that, in a capitalist system of production, capitalists employ ‘the labour of others’ to produce commodities. In order to be able to do so, however, the labourers had to first be ‘freed’ from possessing their own means of production. Capitalism advanced by separating workers from their own means of production, through various means. Enclosure and clearances, for example, forced peasant producers off the land, and, as a consequence, separated them from the means of feeding themselves. Factory production undermined craft workers, who were unable to compete with the more efficient factory-produced versions of the goods that they produced. The development of the factory system made the craft workers’ means of production and skills, and thus their means of living, redundant. This ‘freeing’ of labourers from their means of sustaining themselves also compelled them to search for another means of feeding themselves. They were consequently driven to seek employment from others, or they were ‘free’ to starve.

 
Neither Utopian nor Realistic

In a capitalist society, workers are compelled to work in order to feed ourselves and our families. We are compelled to work in order to put a roof over our heads. We are compelled to work in order to cover our transport costs. Adequately-funded UBI is incompatible with a capitalist society because it would undermine this compulsion. If workers’ time is our own time, not something that we are compelled to hand over to another, then the majority of us would choose not to willingly hand this time over. We would use it for our own ends, not those of another. As Marx put it in Capital, as long as ‘the labourer can accumulate for himself [or herself]—and this he [or she] can do so long as he [or she] remains possessor of his means of production—capitalist accumulation and the capitalistic mode of production are impossible’.

Bregman’s vision is, ultimately, a paternalistic one. His stated aim, of helping poor people to become independent, is at odds with his policy proposal. He is not proposing giving workers common ownership over the means of production. He is not proposing that those who produce the wealth of society should decide how that wealth should be generated, or how it should be distributed. He is, instead, proposing that the better-off members of society salve their consciences by using the state to give handouts to the poor, and remove the stigma associated with welfare by making these handouts universal. His proposal is not realistic. And his vision, of a world in which people would still work for another, is not particularly utopian.

 

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