As the crisis of capitalism deepens, poverty and unemployment are deepening with it, along with the rampant inequalities that are built into the fabric of the system itself. In the absence of a class-conscious, socialist leadership, some workers see their salvation in seductive calls for the state to pay everyone a universal basic income – essentially a more generous and (they hope) less stigmatised dole.
Given the proliferation of suggestions as to how this might work, we are happy to publish this letter, sent in by one of our members, by way of a contribution to the debate. We welcome further contributions from our readers and supporters.
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When the working class succeeds in overthrowing capitalism and establishing a system of planned economy geared solely to providing for the needs of the working people, everybody will have the right and the duty to work to contribute as much as they can to the wealth of society. And everyone will receive from society a share of what society has produced in accordance with their work, after allowing for expanded production and facilities in future years and for emergency stores.
Labour-saving machinery, including robots, will serve to make everybody’s work more productive and less arduous, enabling people’s working hours to be gradually reduced so they have more time to pursue other interests.
Such a scenario is completely impossible under capitalism, but, in order to divert the masses of people away from thinking about how to get rid of the system that is holding us back, all kinds of utopian dreams are from time to time put about that try to suggest that even under capitalism things could be a lot better than they are – if only …
In this context, calls for the implementation of a variety of universal basic income (UBI) schemes have lately begun to gain traction in the media, with the economic and social ramifications of the global response to the coronavirus pressing institutions, policy researchers, NGOs and think-tanks to show willingness in considering radical, unprecedented methods through which a ‘fairer’, more economically stable society might be organised.
Proposals for UBI have been emanating from liberal-left quarters for some time, and many schemes have been tested on various scales in Europe and the US since the 1970s, although never at a national level. These proposals are all designed to create the illusion that it is possible for capitalism to be modified in such a way as to be able and willing to provide a decent living to all, and in this way to preserve the capitalist system from being overthrown by the masses whom it exploits and oppresses.
Their proponents’ anxiety to reassure one and all that capitalism can be successfully reformed becomes more and more frantic the more the noxious failures of the system multiply – the overproduction and the millions of unemployed it produces; austerity in the face of exponentially rising productivity of labour; the mindless destruction by war of the infrastructure of whole countries along with the pauperisation of their populations; the endless queues of refugees risking their own lives and those of their children in their bid to escape to somewhere they might be able to live in peace and scratch a living.
All these horrors demonstrate that the world is crying out for an end to capitalism, and yet its defenders press on regardless from one utopian scheme to another.
It is no coincidence that the majority of people putting forward such ideas themselves are for the moment at least enjoying a reasonably secure life (even if some a lot more than others), and they therefore feel they have something to lose in the turmoil of socialist revolution.
In our view, it is time they accepted that socialist revolution is inevitable and that, to minimise as far as possible the suffering of humanity, it should take place as soon as possible, with all attempts to hold it off being abandoned by every person of the working class.
What is UBI?
The UBI idea proposes that by allowing all adult citizens a basic, non means-tested monthly or weekly allowance, workers will be able to sustain themselves at an adequate level regardless of employment status and earnings, putting everyone on an ‘even keel’ and giving a baseline minimum level of spending power to every individual.
It has gained some traction during the coronavirus crisis because huge masses of people have suddenly become unexpectedly unemployed at the same time, and even bourgeois governments are recognising that something must be done to support them.
The British government is borrowing vast amounts of money in order to pay 80 percent of their wages. However, this is being done primarily in the interests of saving their employers from bankruptcy, so that when the crisis is over some businesses at least will be able to get going again with all their old staff in place.
Even then, chancellor Rishi Sunak is warning that the government cannot keep up these payments for more than a few months – even though they do not extend to all working people who have lost their livelihoods as a result of the crisis, much less to those who remain in employment.
So it is self-evident that no bourgeois ruling class is going to be prepared to commit to paying a living wage to everybody regardless of whether they are working or not. It’s just not going to happen. Those who think that the working class can force the ruling class to grant such a concession are really living in a dream world.
Furthermore, if UBI were really to be sufficient to live on, a whole lot of people would obviously choose not to work at all, which is certainly not acceptable to the bourgeoisie, since it is in the business of exploiting the working class to make profits – there is, after all, no other source of wealth.
Undeterred by logic or common sense, some proponents of UBI promote it primarily as a route towards poverty reduction, while others see it as a way to release workers from the drudgery of non-stop physical and mental labour and so provide the whole population with an opportunity to pursue their own personal creative and entrepreneurial interests.
Petty-bourgeois intellectuals are particularly attracted by the idea of not having to work at all unless the work is to their liking, but still they expect to share in the products of society even if they have done nothing to contribute towards them.
Under capitalism, the bourgeois ruling class needs the working class, as it is the labour-power of workers that is the sole generator of profit – the whole point of capitalist production. It can be seen that on the face of it, it would be in the interests of the capitalist exploiters of labour-power to keep the working class contented, healthy, educated and grateful in order to get the maximum of high-quality work out of them – much as one gets the best milk from happy, well-fed and well-tended cows.
However, because of the need to get ahead in the battle of competition (or face going under), the capitalists are forced to reduce the cost of the labour-power they employ to the lowest possible figure – to pay wages at the lowest level they can get away with; to spend as little as possible on the working environment; to contribute as little as possible to the provision of social facilities for the benefit of the working class; to replace workers with machines, and so on.
This generates an army of unemployed, who increase the potential supply of labour-power and therefore reduce its price (wages) below value – the value being what is necessary to support the workers as workers and enable them to bring up the next generation of workers to replace them.
It follows that workers forced to sell their labour-power below its value receive in wages and other benefits less than they need to live reasonably well, however modest their needs.
The UBI utopians believe that if the bourgeois state would give away to workers proposed amounts that vary depending on who’s talking between £400 and £1,000 per month, this situation could be radically altered.
The sheer absurdity of this can be gauged by turning one’s mind to the las few years of austerity, during which, rather than increasing the benefits being handed out to workers, even those most dreadfully in need, bourgeois governments all over the world have been slashing them – drastically cutting back on unemployment benefit, housing benefit, welfare services, drastically reducing expenditure on education, eliminating student grants and making students pay huge fees, drastically reducing pensions and care provision – and on and on.
Why would any bourgeois government in these circumstances give out a universal benefit, especially to people who didn’t even need it? All one can say is: fat chance!
The way in which UBI is generally presented is very seductive, holding out the possibility of workers being able to choose a job rather than take the first available; of not having to fear complete destitution as a result of unemployment; of having the option of earning higher wages on top; and of using the opportunity to further their studies (assuming they can afford the fees, of course. Will UBI be sufficient to enable anyone, whether working or not, to afford to study in higher education or start a new business [assuming UBI is enough to pay the start-up costs, of course! But £1,000 a month won’t cut it, unfortunately …])
Given the dire situation currently faced by millions of workers even in imperialist countries as a result of the coronavirus crisis, UBI is now even receiving attention from some mainstream commentators and politicians, trusting in the abject naivety of those whom they address.
The SNP’s Nicola Sturgeon recently stated that the case for UBI has been “strengthened immeasurably” by the present crisis, responding to a report from the Reform Scotland think-tank, which suggested that along with eliminating the risk of people falling into a “benefit trap” (owing to the available employment paying less than benefits), UBI could be implemented to support people who are unable to work as a result of social distancing and quarantine measures. (Case for universal basic income ‘strengthened immeasurably’ by coronavirus pandemic says Nicola Sturgeon by Ashley Cowburn, Independent, 10 April 2020).
It is difficult to see what the connection is between UBI and giving support to those who have lost their income as a result of the crisis.
Some temporary (although far from adequate for many) support is being given, as mentioned above, by the British government, which has every intention of recouping the cost from future taxes and future austerity measures. That is very different from pledging to give permanent support to everybody, regardless of whether they are working or not.
The ‘benefit trap’ could very well be avoided far more cheaply by raising the minimum wage, although it would be naïve to expect even such a modest reform from our heavily indebted bourgeois governments or the rapacious employers under their protection.
Jack Dorsey, CEO of Twitter, made a high-profile announcement in favour of UBI as he transferred $1bn into his charity trust to aid the coronavirus relief effort, stating that the charity’s efforts will “focus” on UBI. Well, of course, some employers may well be endorsing a permanent extension of the wage subsidy currently being paid by various governments to employers, hoping that these will continue after the crisis is over, thus substantially reducing the costs of production for individual businesses.
It has also been widely reported that Spain is in the process of implementing UBI as a means of tackling the economic fallout from coronavirus. A closer inspection of governmental plans, however, reveals that what is being considered is a ‘basic income’ benefit for the most vulnerable in society (as a replacement for currently available benefits), rather than the touted ‘universal income’ scheme that is more generally discussed various pundits.
The UK city of Hull, meanwhile, put forward a proposal for trialling UBI back in January, supported by a cross-party group of city councillors (before the idea that the coronavirus was the root cause of the then-impending financial crash had been promoted). Similarly, Labour’s John McDonnell announced a plan to run a UBI pilot scheme in Sheffield and Liverpool if his party had been elected in December last year. (Hull asks to be first UK city to trial universal basic income by Josh Halliday, The Guardian, 19 January 2020)
Absolutely nothing was said about where the cash-strapped local authorities were going to find the money to finance the scheme. Had a Labour government been returned, maybe it would have made the money available, but since the bourgeoisie was deadly opposed to all the proposals for increasing public spending that were being promoted by Corbyn’s Labour party, the bourgeois media went all out to smear the party and stop it getting elected.
It whipped up a fake antisemitism storm, and constantly portrayed Corbyn as incompetent – and the electorate fell for it hook, line and sinker. The Labour party, meanwhile, shot itself in the foot by reneging on Brexit. So the utopian trial in Hull went by the board.
In the US, presidential candidate Andrew Yang made a proposal for UBI a prominent part of his platform – an action that helped to push the concept into the edges of mainstream discourse on both sides of the Atlantic, but which also no doubt helped make sure that Andrew Yang was dropped pdq.
While Yang’s unsuccessful bid for the presidential nomination is over, a few politicians in the States, both Democrat and Republican, have seized on UBI strictly in the present crisis situation – not as any attempt to balance out economic inequalities, but rather in a desperate bid to ward off complete societal collapse.
What is behind the call for a universal basic income?
So what are we to make of calls for a UBI? There are several aspects of the mainstream news narrative that need to be considered when we look at the arguments being put forward.
First, we cannot afford to overlook that the fact that the coronavirus is being used to explain why the global economy is sailing yet again into crisis, since this underlying deception obscures and detracts from the inconvenient truth about the overproduction crisis of capitalism – the real root cause of ever-deeper cyclical financial crashes.
Second, we should take care to distinguish the various discussions of UBI as a temporary support scheme for workers who’ve suddenly found they have no job to go to, no money for rent and essentials, and no prospect under lockdown conditions of finding employment elsewhere, from proposals to implement UBI permanently as a way of restructuring society.
For so long as the coronavirus lockdown is needed, we maintain that the state is responsible for providing the protection and support required by all those workers who have been most immediately and severely impacted by social distancing and quarantine measures.
It was noticeable that the British government embarked on a mission to bail out large corporations so as to protect shareholder dividends and the investments of the super-wealthy as a matter of priority, leaving the vast majority of the working class to trust them on their word that we would be sorted out with loans or a state-subsidised portion of our wages at some future date.
It may be the case that, in Britain, a blanket implementation of some form of UBI, covering all workers for the duration of quarantine and social distancing measures, would have been a far more efficient and equitable approach than the half-hearted and haphazard measures we actually had, which have resulted in a mass of confusion and uncertainty for those struggling to work out what they might be eligible for and how they should go about applying for it – all while the clock ticks and the purse remains empty.
But putting aside the question of whether a tottering, decadent imperialist power such as Britain would actually be capable of implementing such a policy, it’s worth taking stock of what UBI would mean for a country like ours if it were put into place as a permanent replacement for the existing social benefit system – and who would ultimately benefit most.
From time to time, especially when terrified that workers at home might follow the example of Russia’s October Revolution, the rulers of imperialist countries have reluctantly succumbed to the process of distributing a portion of their superprofits from imperialist exploitation amongst the working class at home.
The aim has always been to raise living standards just enough to dampen and divert the class struggle and buy off the danger of revolution. To this end, a few morsels have been spared from the table on which the super-wealthy ruling class devours the stolen riches and resources of plundered colonies, client states and defeated rivals, in addition to the wealth produced through exploitation of the masses at home.
Britain’s welfare state as we know it has its origins in the Keynesian postwar consensus, when a mixture of American loans and colonial extortion paid for the building of a modern welfare state infrastructure. Again, this aimed to ensure that the working class derived a definite benefit from the new world order in which British imperialism subordinated and enmeshed itself with the increasingly dominant US imperialist power.
With the ruling classes of the imperialist countries united in their hatred and fear of socialism, and the postwar prestige of the Soviet peoples and their achievements riding high in the hearts of millions of workers worldwide, raising living conditions for British workers was understood to be a necessary endeavour in order to placate their demands for a socialist society on Albion’s green shores.
Similar moves were made in all the various imperialist states – just as much as was required in each case to quieten the revolutionary sentiments of the masses.
It’s important to remember that, at that point in our history, workers were very much aware of their own collective power and agency. They had been through the experience of the general strike of 1926 and the great depression of the 1920s and 30s, as well as the national effort for WW2, with its huge mobilisation of working men and women in the industrial, agricultural and military spheres.
It cannot be stressed enough that the postwar cross-party consensus, which led to the implementation of the ‘cradle to grave’ welfare state and the NHS, came not simply as a philanthropic reward for services rendered to British imperialism, but because Britain’s rulers were mortally afraid of the working class taking the road of the October Revolution, and determined to do all in their power to prevent such an outcome.
In short, the point of the postwar consensus, and also of the wider Marshall Plan (which saw huge US investment and loans pour into the war-shattered economies of western Europe), was to convince workers that they could have all the social benefits of socialism without needing to overthrow the rule of capital through revolutionary class struggle.
Since then, the process of exporting productive work, along with much of the machinery and industrial infrastructure required to perform it, to developing countries overseas (a process described by Lenin a century ago) has continued apace, allowing the owners of capital to continue to rake in vast profits from the superexploitation of the oppressed world.
The terrible conditions formerly endured by European industrial workers and described so graphically by Friedrich Engels in The Condition of the Working Class in England have not disappeared from the face of the earth, even if they are much attenuated in imperialist countries. Rather, they have been replicated in countries all over Asia, Africa and Latin America as a result of the never-ending quest to maximise profits.
As industrial employment has decreased in the centres of imperialism, the British working class has been subject to decades of abusive treatment, with the vast numbers of formerly productive industrial workers being thrown on the scrapheap of long-term unemployment, or having their employment opportunities restricted to insecure and badly-paid retail and service-sector jobs.
Alongside this there has been a consistent effort, orchestrated through mass media and popular culture, to demonise and devalue productive work as ‘menial’ or ‘unskilled’, with the aim of conditioning successive generations of workers to feel shame and disdain for their class origins and heritage, rather than pride and an urge to take control of the modern world that their labours have created.
It is in this context that UBI is sold to us, with the working class of the imperialist bloc expected to accept our place as useless, defunct organisms, with no purpose other than to consume or sell to others the products of capitalist production in order to achieve some vague sense of happiness and contentment.
According to the popular narrative, we are supposed to be relieved that now, since we’ve been made ‘redundant’ by developments in automation and computing technology, we are all to become eligible for ‘free money’ that will supposedly enable us to lead happier, stress-free lives.
Who really pays? A recipe for parasitism
But glaringly obvious is the fact that UBI proposals are anything but ‘universal’ in the global sense. Production of the necessities of life must continue to take place. To the extent that workers in Britain are no longer producing these, we have to live off the work of those labouring in the oppressed countries.
Workers of poorer, developing countries will continue to toil to produce surplus value from their labour, which will continue to be appropriated by imperialist masters – some of them British – some of which they can then hand over to a working class at home that has been reduced to parasitism.
Presumably the architects of UBI proposals understand, on some level, that the piggybank from which their benefit would be funded will still be relying on capitalist-imperialist economic relations to keep it topped up.
Under such a system, where the means of production and distribution remain in the hands of a super-wealthy, exploiting minority class, such schemes would serve merely to reconcile workers to a purely parasitic existence, with less social agency as a class than at any point in living history.
As if to highlight this point, Esther Duflo and Abhijit Banerjee wrote recently in the Guardian (which has been notable for championing the cause of UBI):
“In our recent book, written before coronavirus struck but with a title that is now eerily appropriate – Good Economics for Hard Times – we recommend that poor countries implement what we call a universal ultra basic income (UUBI), a regular cash transfer that amounts to enough for basic survival. The virtues of a UUBI are its simplicity, transparency, and its assurance that nobody will starve.” (Coronavirus is a crisis for the developing world, but here’s why it needn’t be a catastrophe, 6 May 2020)
Sure enough, these 2019 winners of the Nobel laureate for economics advocate the universal adoption of mobile phone microbanking – ie, extending the reach of finance capitalism in a time of world depression and mass hunger to the huge market of microtransactions it lusts after, thus proving Engels’ point that the capitalists can find money even where thieves can find nothing to steal!
The proposal is that small exploited nations give their citizens a pittance – just enough to ward off starvation (and revolution) – by increasing their national debts and thus further ensnaring themselves in the debt trap that leaves them helpless vassals of western finance capitalism.
A less enticing ‘solution’ to the problem of world poverty could scarcely be found than this proposal to deepen the debt slavery of the world’s working and toiling masses. Nor a more blatant acceptance of the idea that workers in the oppressed countries should be expected to live on far less than those in the imperialist heartlands – and that their workers should continue to subsidise the living standards of ours – in perpetuity.
Our future is one of dignified, useful labour
The demand of workers everywhere should be that we have a right to work, not only in service industries and as handmaidens to finance capital but also in industry, making the essential articles of consumption on which we depend. Everyone in society should have both the right and the duty to work, and advances in productivity should make that work lighter and reduce our working hours, not render us superfluous.
For us to echo calls for universal basic income in Britain would effectively be to abolish this demand, acquiescing in the notion that industrial workers in particular are helpless and redundant in the face of technical progress, and that we need capitalism to ‘save’ us from oblivion.
However, as Lenin demonstrated beyond all question in his Imperialism the Highest Stage of Capitalism, the workings of the capitalist system force the capitalists to export their capital (ie, the accumulated surplus value produced by their workers) in order to maximise profits by transferring their operations to countries where direct and indirect wages, as well as land prices, are far lower, so that gradually the ‘mother country’ becomes parasitic, with the upper classes living by ‘clipping coupons’ and the working class, except for a shrinking upper layer, abandoned to poverty and unemployment.
The demand for UBI seeks to make the working class complicit in this shameful parasitism, but it is hard to see why the bourgeoisie would ever actually cede such a concession. Why would it feel compelled to support a working class that it had rendered redundant?
Instead of sheepishly accepting that we have outlived our usefulness to the capitalist system, and graciously drawing our redundancy package in the form of UBI as we’re ‘put out to pasture’, workers should recognise that the increasing prominence of arguments twinning UBI and automation as the blueprint for our future demonstrates that, in fact, it is capitalism that has outlived its usefulness to society, and has nothing meaningful to offer.
Once this is grasped, we will be on a footing to take the hold of society’s instruments of production and put them properly to use.
RA, Stoke
