Universität Graz
Debate Topic: A Guaranteed Income?As we have all heard many times, it is true that "the rich are getting richer and the poor are getting poorer. One possibility for dealing with the issues of income disparity and poverty is the idea of a guaranteed income – which we will debate in class. Read the passage below, which describes the proposal for the government to pay a certain income to all citizens. Keep in mind that this system would replace all the many individual-case benefits being offered at the moment as well as the pension system, family and child supports, etc. Weigh the advantages and disadvantages of such a system and then decide which side of the debate you will argue. Would you support such a proposal in principle? Yes or no?On the following pages you can see some graphic depictions of income disparity in the United States –these may help you to decide whether or not you agree with the idea of some wealth distribution.(from David Korten's, When Corporations Rule the World)"Guaranteed Income. An idea long popular with both conservative and progressive economists, a guaranteed income merits serious consideration. It involves guaranteeing every person an income adequate to meet his or her basic needs. The amount would be lower for children than for adults but would be unaffected by a person's other income, wealth, work, gender, or marital status. It would replace social security and existing welfare programs. Since earned income would not reduce the guaranteed payment, there would be little disincentive to work for pay. Indeed, if some people chose not to work at all, this should not be considered a serious problem in labor-surplus societies. Although some wages would no doubt fall, employers might have to pay more to attract workers to unpleasant tasks. It would allow greater scope for those who wish to do unpaid work in the social economy. Such a scheme would be expensive, but could be supported in most high-income countries by steep cuts in military spending, corporate subsidies, and existing entitlement programs and by tax increases on upper income, luxuries, and the things a sustainable society seeks to discourage. Combined with an adequate program of universal publicly funded health insurance and merit-based public fellowships for higher education, a guaranteed income would greatly increase the personal financial security afforded by more modest incomes. In low income countries, agrarian reform and other efforts to achieve equitable access to productive natural resources for livelihood production might appropriately substitute for a guaranteed income." (p.318)Suggestions for extra reading / independent work:If you are not clear about the terms "Mindestsicherung" and "Grundeinkommen", it would make sense to look them up. Keep in mind that these proposals differ in some (significant) ways from Korten’s “guaranteed income”. A similar proposal (called "Bürgergeld") was made by the CEO the company DM, Werner G?tz, in an interview in 2005. You can find this interview - ""Die Wirtschaft befreit die Menschen von der Arbeit" – under extra materials on the homepage. ( )Some graphics depicting income disparity in the US: Rich are the SuperrichA huge share of the nation's economic growth over the past 30 years has gone to the top one-hundredth of one percent, who now make an average of $27 million per household. The average income for the bottom 90 percent of us? $31,244.Note: The 2007 data (the most current) doesn't reflect the impact of the housing market crash. In 2007, the bottom 60% of Americans had 65% of their net worth tied up in their homes. The top 1%, in contrast, had just 10%. The housing crisis has no doubt further swelled the share of total net worth held by the superrich.Winners take it allThe superrich have grabbed the bulk of the past three decades' gains.Out of BalanceA Harvard business prof and a behavioral economist recently asked more than 5,000 Americans how they thought wealth is distributed in the United States. Most thought that it’s more balanced than it actually is. Asked to choose their ideal distribution of wealth, 92% picked one that was even more equitable.3544842190418300Who's WinningFor a healthy few, it's getting better all the time. ................
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