The present article offers three critiques of the universal basic income guarantee (BIG) proposal discussed by Standing in this volume. First, there is a fundamental tension between the way income in a monetary production economy is generated, the manner in which BIG wishes to redistribute it, and the subsequent negative impact of this redistribution on the process of income generation itself. The BIG policy is dependent for its existence on the very system it wishes to undermine. Second, the macroeconomic effects of BIG on contemporary economies that use modern money are destabilizing. The job guarantee (JG), by contrast, stabilizes both the macro-economy and the currency while helping transform the nature of work itself. Finally, the employment safety-net in Standing’s piece is not an accurate representation of the modern JG proposals – a confusion which this paper aims to remedy.
The author gratefully acknowledges financial support through a grant from the Institute for New Economic Thinking.
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In a capitalist economy, it is not completely possible to divorce oneself (much less the society at large, by definition) from the modern market. If it were possible to organize production at the macro-level in a way that individuals did not need to purchase any commodities, then there would be no need for BIG. However, in large part due to the existence of property rights, even those individuals who may want to engage in subsistence production will still need to purchase commodities (seeds for the gardens, timber for home repair, solar panels for home electricity production, etc).
The redistribution of labor between the private and public sectors will depend on the level where the public sector wage is set and on the stage of the economic cycle.
For data and additional macroeconomic analysis see e.g., Tcherneva and Wray (2005c).
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