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Essais critiques

Universal Basic Income, Basic Needs, and Consumer Sovereignty

Alexandre Chirat
p. 89-100
Référence(s) :

Anton Jäger and Daniel Zamora Vargas, Welfare for Markets, A Global History of Basic Income, Chicago: The University of Chicago Press, 2023, 264 pages, 978-022682368-3

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Crédits : The University of Chicago Press

1Welfare for Markets is a stimulating and comprehensive book that fulfils the promise of offering “a global history of basic income”. After specifying the concept of Universal Basic Income (UBI)—an unconditional, individual, and universal monetary income—in the introduction, Anton Jäger and Daniel Zamora Vargas explore, in time and space, the different proposals for guaranteed income in order to unfold the worldviews that underpin them. The book thus constitutes a history of UBI proposals and their rationales based on a multitude of works in the history of ideas, particularly in economic and political thought. The choice of rereading the history of the social question through the prism of the concept of UBI proves to be relevant. Indeed, Jäger and Zamora Vargas demonstrate how its promotion is always accompanied, whatever the context, by a redefinition of the economic and social problems it is supposed to alleviate. For example, the book analyses the shift from a structural to a monetary vision of poverty, the transformation of a “Planning State” into a “Transfer State” and the processes of individualization and abstraction of the idea of basic needs. Hence the main thesis of the book: the partisans of a UBI, beyond contextual and programmatic divergences, do not share a “coherent ideology”, which explains why it has defenders from different political backgrounds, but rather a “specific way of thinking”. Such a way of thinking postulates that the operation of the market price system is the best way to allocate resources since individuals are considered as the best judges of their basic needs (9).

  • 1 This expression comes from Arthur Kemp, director of the Mont Pèlerin Society, who looked for an alt (...)

2The book is cleverly structured to provide a chronological progression with geographical shifts. Chapter 1 is an “anti-mythology” challenging teleological reading of the origins of Universal Basic Income in 18th and 19th century political thought in Britain and the US. The second chapter, through the prism of Milton Friedman’s proposal for a negative income tax, demonstrates how a break in thinking about the idea of UBI was taking place, a break initiated by economists sharing an adherence to the principle of consumer sovereignty. This adherence is the main foundation of the specific way of thinking about economic and social problems that unites the supporters of UBI. Chapter 3 revisits the gradual disappearance of the New Deal social order in the United States in the 1950s and 1960s, which was replaced by the promotion of an ideology of “welfare without the welfare state.”1 Chapter 4 deals with European debates, particularly in France and the Netherlands in the 1980s. Chapter 5, using the examples of South Africa, India, and Mexico, explains how, in the 1990s and 2000s, the idea of UBI shaped economic and political debates on the best ways to promote development in the “Global South”. The book concludes with an epilogue that takes us back to the US, where the cash transfers experimented within the countries of the Global South over the past 20 years are now being transposed as a new weapon in the war against poverty.

1. “An Anti-Mythology”

  • 2 On 19th century populism in America, see Jäger (2021).

3Emphasizing the criteria of unconditionality, individualization and universality, the authors point out the paucity of proposals for a UBI in 18th and 19th century political philosophies. Agrarianism is an ideology centered on property. Its main advocates (such as populists Henry George and Edward Bellamy) considered that political stability requires either a rotation of land or the taxation of land to compensate non-owners by funding redistribution.2 While many proposals echo the contemporary concept of UBI, most of them make the receipt conditional on working. In the context of societies that were not affluent yet, non-participation in production was widely considered as an act of “social secession” (22). Like agrarianism, the “producerism” of 19th century European socialists confronts the problem of providing a decent minimum for everyone in order to satisfy basic needs, in other words, to ensure their freedom. They nevertheless broke with the ideal of agrarianism of a republic of smallholders to think about the socialization of property in the wake of the industrial revolutions. But contrary to contemporary projects, the proposed allocations were often based on lists of goods in kind rather than on monetary transfers, in addition to being conditional on work. The only proposal that can truly be considered as the ancestor of UBI is the “territorial dividend” plan of a Belgian Fourierist lawyer, namely Joseph Charlier. This plan consists in an allocation decoupled from both property and work. Its implementation would nevertheless remain null and void (Cunliffe and Erreygers, 2001).

4It was only with the ideological break with agrarianism and producerism that, from the inter-war period onwards, unconditional cash transfers, rather than transfers in kind, took pride of place in the arsenal of means to alleviate poverty. This ideological break mainly took root in Great Britain, where the figure of the consumer replaced that of the owner and the worker as the basis for thinking about wealth (re)distribution. However, it was another social model, associated with the name of William Beveridge, that gained political acceptance. This model was based on the production of public services, in other words, redistribution in kind. The schema of the liberal aristocrat Juliet Rhys-Williams, famous for influencing Milton Friedman, was intended as an alternative to the Beveridgian model of social security, which was considered a “disincentive” to work and a “paternalistic” system centered on the “male bredwinner” (30). The multitude and diversity of the projects presented by Jäger and Zamora Vargas in this chapter set the stage perfectly for their thesis in chapter two, namely that the ideological break occurring in the inter-war period takes root in the mutation of economics.

2. Friedman’s Negative Income Tax and Welfare Economics

  • 3 In 1934, Tinbergen coined the term basikinkomen.

5This chapter, which should be of particular interest to historians of economic thought, relates how Milton Friedman proposed in 1939 “one of the first and most coherent versions of a noncontributory guaranteed cash transfer scheme” (35). This type of scheme, which is immediately thought of as an alternative to social security models in which the state plays a pivotal role in the allocation of resources, gradually gained support of many economists of various political sensitivity (William Hutt, Abba Lerner, George Stigler, Jan Tinbergen, James Tobin).3 Jäger and Zamora Vargas repeatedly stress the importance of the controversies among economists in their history of the idea of UBI: “New interwar economic debates on welfare economics, needs and the state as social planner shaped innovative ways to tackle poverty and inequality” (36). The shift from old welfare economics to new welfare economics in fact favors the emergence of a cognitive infrastructure within which the concept of guaranteed income emerges as the preferred solution to settle the social question. Firstly, the shift from a cardinal to an ordinal conception of utility generates the substitution of the concept of needs for that of preferences and the substitution of an objectivist conception of these needs for a subjectivist one. Such subjectivist approach to needs through the concept of individual preferences then legitimizes the argument of the superiority of cash transfers rather than transfers in kind. Secondly, since needs, as revealed by consumer choices, are considered to be specific to everyone, Arthur Pigou’s argument that cash transfers could generate waste when they “satisfy needs different from those collectively defined as important” no longer holds (38). It is not only seen as an expression of paternalism imposing a normative conception of the good life, but also as outside the legitimate boundaries of economics as established by Lionel Robbins with his plea against value judgment. Thirdly, the utility maximizing objective of old welfare economics, inherited from utilitarianism and having a powerful egalitarian dimension, is explicitly abandoned by Friedman. He favored a freedom maximizing objective, freedom understood in the sense of freedom of choice, namely the absence of coercion in the expression of consumer preferences. Jäger and Zamora Vargas conclude that the elevation of the market price system to a true “civilizational benchmark” is not only due to its economic efficiency properties but also because of its political efficiency in preserving individual freedom: “the end goal was to be free in the market rather than free from the market” (49-50).

  • 4 For more details, see Desmarais-Tremblay (2017) and Chirat (2020).

6While Beveridge believed that increasing purchasing power was not a solution to the social question as “many vital needs can be met only by collective action” (46), Friedman thought otherwise, putting aside the analysis of the supply side of the market. Concretely, his scheme aims at establishing a basic income through the definition of a minimum standard of living to be guaranteed by “an equivalent income rather than by collective provision” (43). While it cannot be described as paternalistic, in the sense that it intends to allow individuals to freely express their preferences as consumers, we want to stress that such conception reflects both an essentialist and technocratic approach to basic needs. Friedman leaves it to experts—according to criteria of nutritional intake—to determine the minimum standard of living required. Which rules and procedures would determine who is qualified or not as an expert? Friedman does not seem to have addressed this problem inherent in any technocratic delegation of policy issues. Moreover, such an essentialist approach of basic needs is in opposition to “conventionalist” approach of basic needs, namely conceptions that consider that “they are what society agrees individuals should not be without” (Penz, 1987, 166). In economics, such conventionalist approaches to needs were promoted, for instance, by Richard Musgrave—through his concept of “merit wants”—and John Kenneth Galbraith—when he diagnosed a social imbalance within American capitalism.4 While they explicitly provide a list of basic needs (education, health, housing), the choice of a public or private procurement of these needs is left to the political debate and must be determined through vote rather than by experts. Jäger and Zamora Vargas do not explain in these terms the opposition between essentialist and technocratic conceptions of basic needs and conventionalist and democratic one. But they make clear the process of depoliticization of the definition of basic needs that underpins the worldview that presides over the justification of unconditional cash transfers as a privileged means of fighting poverty, which is reconceptualized in passing as an essentially individual and monetary phenomenon (53).

3. The New Deal Welfare State on Trial

  • 5 Friedman rejected such a label. For instance, he wrote to Galbraith on October 1, 1978: “I have alw (...)

7The growing popularity of guaranteed income proposals in the United States from the 1950s, including Friedman’s negative income tax, is stimulated by the recognition that the social order inherited from the New Deal has failed to address the problem of poverty, despite the substantial increase in per capita living standards. Jäger and Zamora Vargas emphasize the contrast between two modalities of social control of the economy. While in the New Deal paradigm, poverty is not considered in isolation from all other economic relationships and the solutions have in common that they aim at reducing dependence on market mechanisms, proponents of the UBI paradigm generally denounce the inefficiency and obsolescence of increased public spending and full employment policies. Through the lens of the contemporary concept of UBI, the book thus provides a fresh reading of the debates between various liberal Keynesian economists, such as Walter Heller, Galbraith, Leon Keyserling and James Tobin, or sociologists, such as Michaël Harrington. The authors argue that the seeds of “reactionary Keynesianism” under Kennedy and the emergence of the “New Left”, based on an anti-paternalist and anti-statist ideology—led to the emergence of support from the left of the political spectrum for Friedman’s scheme, that Jäger and Zamora labelled as “conservative”.5 Convinced that technological progress was biased towards polarization of the workforce and that structural unemployment was substantial, many new left intellectuals wanted, from the 1960s onwards, to “dispense with work as the central category for human emancipation” (71).

8In addition to economic issues, social issues put forward by some protagonists of the civil rights and feminist movements also foster the proposals in favor of UBI. Some activists from the civil rights movement consider that the Welfare State resulting from the New Deal has contributed to the marginalization of African-Americans and that large industrial unions are a tool at the service of a privileged white working class. In the face of this Welfare State, which is considered discriminatory and even racist, a guaranteed income suits claims based on racial and cultural identities, since it satisfies both the ideas that African-American poverty is a specific problem and that it is the poor African-Americans themselves who are best able to determine and satisfy—albeit only individually—their basic needs. The idea of a guaranteed income was also thought to be a means of empowering women and to be “a natural solution to female and industrial joblessness” (84). Some women activist however fear that such cash transfers could instead stuck beneficiaries in a dependency trap that would not allow them to emancipate themselves, an emancipation that would instead be possible under full employment policies. Having traced back the rationales for the growing intellectual support for UBI, whose merit is to reconcile the individual’s freedom of choice with the freedom of market mechanisms, Jäger and Zamora Vargas nevertheless point out that these measures, whatever the context, came up against a political problem of the first order: “adequate basic incomes were unaffordable, while affordable basic incomes remained inadequate” (91).

4. Post-Workerism in Europe

  • 6 On Foucault’s political thought and its link with neoliberalism, see Dean and Zamora (2021).

9In Europe, the Netherlands was the first country to experience a national debate on the possibility of implementing a universal income from the 1980s onwards, with a number of intellectuals arguing for the decoupling of work and income in a context of stagflation and in the light of the US debate (94). At the same time, “New Left intellectuals” such as Jean Baudrillard, Michel Foucault, André Gorz, Herbert Marcuse, and Ivan Illich all insisted on the autonomy of the individual as a fundamental value. That led them to reconsider both “socialism’s emphasis on the dignity of labor” and the very definition of such concept of labor (99). It is no longer a question of liberation thanks to work, but of liberation from work seen as the privileged vehicle of the alienation of the individual. In both France and Netherlands, Jäger and Zamora Vargas point out that proposals for guaranteed incomes were based on two core beliefs. First, technological progress liberates from the imperatives of productivity that foster authoritarian coordination within the firm and allows for increasing free time. Second, the New Left was eminently suspicious of the state, as illustrated by the case of France. On the intellectual level, Foucault laments for instance that social security led to “standardize the conduct of individuals” and to “impose a particular way of life.”6 On the political level, the deuxième gauche, embodied by Michel Rocard, undertook to “destateify French society” (109-110).

  • 7 On the thesis of “the convergence of the extremes” in economics, see Olson and Clague (1971).

10The description of the intellectual path of Philip Van Parijs is a particularly stimulating moment. Van Parijs is one of contemporary main advocates of a maximalist version of UBI, in the name of negative freedom rather than freedom as the ability to satisfy one’s needs. A close reader of economics, Van Parijs sees universal income as a substitute for labour market regulations such as the minimum wage, as well as a way of shattering “the simplistic beauty of the left-right axis” (117). André Gorz diagnosed at the same time the “partial osmosis” between “neoliberals and neosocialists”.7 While he was initially skeptical, insofar as it would make work “optional” and “absolve society from concerning itself with the equitable distribution of necessary work” (121), Gorz finally rallied to Van Parijs’s arguments in favor of UBI. The changes in the nature of work, the difficulty of measuring work and the fact that any activity can be considered as work explain that he changed his mind. The reconstruction of Van Parijs’s (1984) and Gorz’s (1985) thoughts enables Jäger and Zamora Vargas to exemplify their general thesis that the two intellectual waves of anti-statism on the one hand and post-workerism on the other favor the adherence to proposals for a UBI.

5. Cash Transfers in the Global South

11The final chapter of the book examines the changes in economic development policies. The Western development model based on industrialization, which inspired structuralist development policies until the 1970s, is said to be unsuited to the countries of the South. In South Africa, the end of apartheid revived interest in the fight against poverty and inequality. But in a context of advanced globalization, Mandela’s African National Congress broke with Marxist ideology and state-led planning to initiate “a market-friendly democratic transition” (130). Under the influence of the development economist Guy Standing and in line with the demands of the IMF and the World Bank, a guaranteed monetary income emerged as the main social policy. In 1994, 2.4 million South Africans received cash transfers and this number rose to 61 million in 2014. Although a contribution to the history of ideas, the reader, in this chapter particularly, would have welcomed a more detailed and informative discussion of the consequences of the implementation of UBI programs, especially on the dynamics of growth, poverty and inequality.

12Between the 1990s and 2010, such cash transfers programs indeed proliferated throughout the Global South. For structuralist economists, such as the Argentinian Raoul Prebisch, development required industrialization and the problem of poverty in “Third World” countries was seen in relation to the international division of labour. From the 1970s onwards, international institutions focused more on the internal economic problems of the countries of the South, advocating structural adjustment plans that would, however, lead to the so-called “lost decade” of development. The case of India provides an account of such paradigm shifts in development economics. The policies of planning and industrialization advocated by Nehru and Mahalabonis first, followed by structural adjustment plans in the 1990s, led to the same failures, namely economic growth without a consistent rise in living standards and reduction in inequality (148-154). These failures, in the context of the “humanitarian turn” of development aid, reinforced the appeal for cash transfers as an alternative to industrialization policies, public services development and price control policies. In 2013, the Indian government eventually replaced the Public Distribution System (subsidized basic goods) with cash transfers.

13Overall, Jäger and Zamora Vargas describe the development of a deep ecosystem around cash transfers as a means of alleviating poverty. Firstly, cash transfers are particularly suited to the new tools of economics, in particular randomized controlled experiments and microsimulations. Second, cash transfers do not contradict, but rather complement, structural adjustment plans advocated by institutions such as the World Bank and the IMF. Third, cash transfers pilot projects are increasingly being driven by non-governmental organizations, in a political context that foster reducing the control of states over their economies. Fourth, UBI’s advocates claim that such a scheme allocates resources from the bottom, i.e. from individuals, in contrast to top-down state-led development policies through industrialization and planning. The most recent forms of development aid are direct transfers to some individuals, notably promoted by the NGO GiveDirectly, created by co-founders of Facebook and Google. Surprisingly, Jäger and Zamora Vargas do not discuss the affinities between cash transfers programs and the design of “surveillance capitalism” (Zuboff, 2019). The trends in favor of cash transfer rather lead them to describe the new vision of development emerging since the 1990s as a form of “market populism”, since marketisation is promoted “from below rather than from above” (158). For advocates of the principle of consumer sovereignty, the legitimacy of coordination by market prices is analogous, or even superior, to democratic legitimacy, based on citizen sovereignty (Chirat, 2022). But such an individualistic conception of the people distances them from the populist’s one, which is rather organicist, so that the concept of “market populism” would deserve to be detailed. And even though in more than 60 countries it is the state that runs cash transfer programs, the authors’ conclusion is straightforward: “Development as a state-led enterprise was soon dissolved in the vast impersonal ocean of aggregated consumer choices” (162).

6. Universal Basic Income and Technopopulism

  • 8 On the differences between technocracy and populism, see also Schroeder (2020, 25-26).

14The book concludes with an epilogue which looks at how direct cash transfers, first experimented in the Global South to alleviate poverty, are now being implemented in the US, especially under the patronage of corporations of platform capitalism. Jäger and Zamora Vargas attribute the enthusiasm for cash transfers to three main factors: the process of privatization of needs, the retreat of work as the basis of social identity and the disorganization of civil society (retreat of mass parties and trade unions). By the term “technopopulism”, Jäger and Zamora Vargas refer to the idea that people are considered to know best what is good for them, an idea at the basis of the legitimization process of UBI. They also argue that many populists believe that “reducing poverty does not imply a top-down approach to needs or pushing the market out of social life” (171). Building on the work of Bickerton and Accetti (2017; 2021), they claim that “technocrats and populists” share “an abstract view of human needs” (171). One would therefore like to know which contemporary political ideologies have resisted this trend of abstraction of needs which appear as a structural one since the interwar? If technopopulism is considered by the Jäger and Zamora Vargas as an ideology, either thin or thick, a clear conceptual characterization would have helped the reader. They explain that the “technopopulist” dimension of UBI is embedded in the fact that the preference for direct cash transfers would be a manifestation of the rejection of political intermediation that technocrats and populism share. But paradoxically, as Caramani (2017, 60) points out, populists and technocrats also share the idea that the general will (or public interest) is unitary and objective. Therefore, if public interest can be objectively known, would transfers in kind not be potentially superior to transfers in cash, especially if pure collective goods are included in the list of goods that satisfy assumedly objective basic needs? Proponents of UBI would answer, against both populists and technocrats, that such view runs counter the pluralism of values characterizing modernity. Thus, although thought-provoking, the complexity of the relationship between populism and technocracy might be too massive for the insights of the epilogue to convince all the readers.8 This reservation is nonetheless minor compared to the way in which the book fulfils its objectives and invites us to a salutary reflection on the question of the right balance to be found between individual and collective processes of satisfaction and production of basic needs.

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Bickerton, Christopher J. and Carlo I. Accetti. 2017. Populism and Technocracy: Opposites or Complements? Critical Review of International Social and Political Philosophy, 20(2): 186-206.

Bickerton, Christopher J. and Carlo I. Accetti. 2021. Technopopulism: The New Logic of Democratic Politics. Oxford: Oxford University Press.

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Zuboff, Shoshana. 2019. The Age of Surveillance Capitalism. New York: Public Affairs.

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1 This expression comes from Arthur Kemp, director of the Mont Pèlerin Society, who looked for an alternative to the planning state-led model of management of the social question.

2 On 19th century populism in America, see Jäger (2021).

3 In 1934, Tinbergen coined the term basikinkomen.

4 For more details, see Desmarais-Tremblay (2017) and Chirat (2020).

5 Friedman rejected such a label. For instance, he wrote to Galbraith on October 1, 1978: “I have always rejected the term ‘conservative’ as describing my position. I am a liberal in the 19th century British meaning, not a conservative” (Holt, 2017, 486).

6 On Foucault’s political thought and its link with neoliberalism, see Dean and Zamora (2021).

7 On the thesis of “the convergence of the extremes” in economics, see Olson and Clague (1971).

8 On the differences between technocracy and populism, see also Schroeder (2020, 25-26).

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Alexandre Chirat

EconomiX, Université Paris-Nanterre.

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