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Basic Income as a Realist’s Transformative Strategy


Abstract and Figures

Progressive politics needs bold new visions that can be contrasted to current processes of erosion. Based on research conducted at the Progressive Hungary Foundation as well as on already existing policy proposals we elaborate a basic income scheme in line with the recent proposal of Iván Szelényi (2014) that could be immediately implemented in Hungary. In this chapter we first we analyse the political rationale of the proposal illuminating the careful balance between desirability, feasibility and achievability. The most important moral argument in favour of the basic income is that it allows a basic freedom and a basic sense of security for everyone (Van Parijs, 1995). These general arguments have been laid out in detail already so we concentrate on the politics of our scheme. Next we describe in detail the working of the scheme as divided into various eligibility groups and we also present detailed financial evidence that the proposal can be introduced immediately without impairing the balance of the budget. We conclude our proposal by pointing out the social effects of the scheme as well as elaborating the first steps towards implementing the proposal at the EU level.
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Basic Income as a Realist’s
Transformative Strategy
Gábor Scheiring, University of Cambridge
Miklós Sebők, Hungarian Academy of Sciences
Bence Tordai, Progressive Hungary Foundation
1. Introduction
Precariousness is on the rise in most parts of the globe (Standing, 2011) and
Europe is no exception. The economic turmoil of the EU has intensified social
tensions throughout the continent and threatens not only with a prolonged social
crisis but with the erosion of democracy as well (Streeck, 2014). Instead of a regime
of structural reforms that further diminish Europe’s most valuable resource - the
people - we need structural transformations that equalize life chances and political
influence. In the recent years Hungary has undergone a profound process of social
and democratic erosion (Bozóki, 2011 and Kornai, 2015). The country is perhaps
ahead on the road but many countries travel into the same direction. Social
polarization goes hand in hand with the rise of illiberal politics throughout Europe.
Progressive politics needs bold new visions that can be contrasted to current
processes of erosion. Based on research conducted at the Progressive Hungary
Foundation as well as on already existing policy proposals (Ackerman, Alstott, &
Van Parijs, 2006; LÉT Working Group, 2014; Standing, 2011; and van der Veen &
Groot, 2000) we elaborate a basic income scheme in line with the recent proposal
of Iván Szelényi (2014) that could be immediately implemented in Hungary.
Not all desirable alternatives are viable, and not all viable alternatives are
achievable, writes Erik Olin Wright (2007, p. 28) in his guidelines for envisioning
real utopias. Our proposal is designed to pass Wright’s criteria of desirability,
viability and achievability. Such an approach requires a low level of abstraction
therefore we focus on one particular country that we know best: Hungary. Our
scheme nevertheless responds to trends that are also present in other countries
and in the conclusion we point out the first steps toward an EU level approach. By
Gábor Scheiring, Miklós Sebők, Bence Tordai
Focusing on one country we gain at clarity and exactness and we lose at
universality. As a semi-peripheral country with limited budgetary resources and a
culturally rather conservative society Hungary is not that far from other similarly
positioned economies in Europe. Countries at the middle level of GDP per capita
hierarchy face comparable obstacles when talking about progressive
transformative strategies thus we hope that our proposal might prove to be useful
for a wide range of countries.
In this chapter we first we analyse the political rationale of the proposal
illuminating the careful balance between desirability, feasibility and achievability.
The most important moral argument in favour of the basic income is that it allows
a basic freedom and a basic sense of security for everyone (Van Parijs, 1995). These
general arguments have been laid out in detail already so we concentrate on the
politics of our scheme. Next we describe in detail the working of the scheme as
divided into various eligibility groups and we also present detailed financial
evidence that the proposal can be introduced immediately without impairing the
balance of the budget. We conclude our proposal by pointing out the social effects
of the scheme as well as elaborating the first steps towards implementing the
proposal at the EU level.
2. The Politics of Realistic Transformation
Our purpose was to come up with a proposal that can break the current
deadlock of Left-wing politics in Hungary. Elaborating a social vision that provides
a comprehensive alternative to the neoconservative and illiberal social policy of the
current regime is a major challenge for progressives. A policy proposal designed to
be implemented in the foreseeable future needs to be able to catch the attention
of the majority of the population. A critique often levelled against basic income is
that it presents a burden on the budget that makes it practically not
implementable as well as it serves as a disincentive to work (Van Parijs, 2001). In
response to these criticisms we drafted a proposal that is not only desirable but
viable as well both financially and politically.
Sources of finance could come from taxes on capital, on consumption, wealth
or on personal income. Taxing capital in the age of liberalized capital accounts
represents a challenge for countries that want to introduce taxes unilaterally (Tanzi,
2000). International capital taxes are theoretically a better option but the political
feasibility of such taxes is unclear. Even though the European Commission has
come up with a proposal for an EU wide financial transaction tax it is still very far
from implementation (European Commission, 2013). The harmonization of capital
gains tax among EU countries faces harsh objection especially from countries
operating with a low tax regime to attract foreign investment.
A politically feasible basic income scheme therefore needs to focus on national
taxation which limits the amount of budgetary revenues collected through taxes on
Basic Income as a Realist’s Transformative Strategy
capital. Taxing consumption is not only morally less attractive as it would
disproportionally hurt lower income groups but is financially also not feasible in
Hungary given the already very high 27% rate VAT. There were several efforts to
tax wealth in Hungary but all failed. The Constitutional Court ruled that value based
wealth taxes are unconstitutional (8/2010. I.28 Resolution of the Hungarian
Constitutional Court). Forms of wealth taxes targeted to luxury goods have failed
to yield significant budgetary revenues in the previous years. General wealth taxes
levied on the whole population face harsh rejection by all income groups in the
country. International wealth taxation would be a theoretically better option as also
proposed by Piketty (2014) but this is even further away from becoming reality
than international capital taxation. Taxing offshore wealth would be a major step
forward but there needs to be a lot of political work to be done to achieve this
(Henry, 2012).
This leaves us with personal income taxation as a major source of sustainable
and feasible revenue. However, previous research has shown that introducing a
minimally meaningful universal basic income would require such an increase in
personal income tax (LÉT Working Group, 2014) that it would pit the working
middle class strongly against such a proposal. Financing the basic income solely
through personal income tax would actually reduce the net average wage that is
already one of the lowest throughout the OECD making such an approach
politically very unattractive (OECD, 2010, p. 155).
The political support of the working poor and the working middle class is
crucial for the implementation of the basic income. If the basic income is perceived
as solely beneficial to the most disadvantaged groups of society meanwhile
increasing the already high tax burden of the middle class then it will be strongly
opposed by the majority. Decreasing the net average wage to simultaneously
introducing an unconditional income would make such a proposal also vulnerable
to attacks regarding working incentive.
We propose a basic income that is directly implementable, financially
sustainable and possibly attractive to low income groups, to the unemployed as
well as to the working poor and working middle classes. Our approach rests on a
mix of income sources and on a mix of actual payment methods that makes it both
financially and politically viable. A basic criterion for our proposal was that it should
be viable in budgetary terms: it should not impose additional burdens on future
generations and should not cause an increase in sovereign debt. This can be
achieved through an unprecedented, radical budget reform: we shall reduce taxes
on work and tighten up rules on pollution, wastage, high incomes and profits,
corruption and wealth of dubious origin.
Our figures are given in Hungarian Forints (HUF) and based on Hungarian
public finance data. The average net monthly salary in the country currently is
around HUF 150,000 (=EUR480) and the minimum wage is currently ca. net HUF
70,000 (=EUR 225). A similar proposal viable in other peripheral EU countries
should be adjusted to local financial characteristics.
Gábor Scheiring, Miklós Sebők, Bence Tordai
3. The proposal: 2550–75100
In this section be provide a detailed description of the working of the scheme
as divided into four eligibility groups. Individuals entitled to a basic income are
Hungarian citizens living in Hungary for at least eight years. They can be divided
into four major groups which at the same time determine the technical means for
receiving their respective basic income. To sum up the different varieties of basic
income we use the sequence of 25-50-75-100 which means the monthly benefit of
each eligibility group in thousand HUF. Everyone will be entitled to at least this
amount of basic income, in parallel of which the current, lower benefits will be
phased out, while higher benefits will be reduced by the amount of the basic
The first group consists of children and young people under 18. They will be
entitled to HUF 25 thousand, which will be transferred by the State Treasury to an
account specified by the parents. In a family with one or two children, this measure
equals to doubling the family allowance implemented with immediate effect. In the
case of the second eligibility group, the inactive population aged 18 and over (e.g.
old-age pensioners, disabled workers, students in higher education, etc.), people
with undeclared work and unemployed persons, the introduction of a basic income
guarantees a subsistence allowance of no less than HUF 50 thousand per capita.
The third group consists of expectant mothers. The community would provide
them with a monthly income of HUF 75 thousand in order to support them in
having a child, or, in other terms, unborn children become entitled to a basic
income as early as six months before birth. The fourth group comprises those in
employment. The State would guarantee that they receive a minimum pay of HUF
100 thousand (the 100 thousand net minimum wage), which represents a monthly
growth in earnings of no less than HUF 30 thousand. From the average income
upwards, the amount of the supplement decreases in a way that the majority of
those in employment will be better off than with the current tax system.
According to available data the number of those belonging to the four
eligibility groups is as follows: of the population of 9.9 million, 100 thousand
people are foreign nationals, while 400 thousand people are engaged in a
professional or trade activity abroad. Out of the remaining 9.4 million people 1.9
million are minors under 18, while the number of expectant mothers is around 90
thousand a year. The adult population in possession of a certificate of domicile is
about 7.5 million, of which 2 million 841 thousand persons were employed at the
end of 2014; however, the number of individuals with at least one month's
declared personal income was significantly higher. Of the remaining 4.7 million
people over two million receive old-age pension. Therefore the sum of the inactive
population between the age of 18 and retirement age and of unemployed active
population is around 2.7 million people; many of whom, around 1.4 million have
declared income.
Basic Income as a Realist’s Transformative Strategy
In case of children and young people (i.e. under 18 years of age) the amount of
the basic income is HUF 25 thousand. In addition to the amount of the basic
income, the most important change is that fragmented benefits that have been
granted from several different sources and according to varying logics, will be
replaced by one single scheme, since this is the only way to ensure that all children
are treated equally by society. Accordingly, those benefits that cannot be used by
all families with children, such as the family tax relief, will be eliminated. Allowances
that are lower than the basic income, even in aggregate terms, will be phased out,
while in all duly justified cases disability or sickness benefits will be established or
maintained in order to compensate for any additional expenses (see Table 3). As a
general rule, the basic income will be transferred to an account specified by
parents (foster parents etc.).
The group of Hungarian nationals over 18, residing in Hungary without
employment (hereinafter abbreviated as 18+) is the most diverse one of all four
eligibility categories. So hereby we will only refer to some basic payment principles
and to the precise definition of the basic income of major stakeholder groups. In
all cases members of the 18+ group shall be entitled to a monthly basic income of
at least HUF 50 thousand (reduced only by the health insurance contributions, see
hereunder). Taking into account the existing complex scheme of social, pension or
jobseekers' benefits, the basic income will result in different increases in income for
all those entitled. This applies particularly to two major parts of the group: the
inactive population and those working but not employed or the active jobseekers.
Starting with the largest group of inactive population, currently about two
million people receive old age pension. In their case, the basic income ensures that
the value of old-age pensions reaches HUF 50 thousand. In case of pensions higher
than the introduction of a basic income means no positive change. According to
our calculations (if we take into account, inter alia, revenues from widow's pension)
30 thousand old-age pensioners could be affected in 2015. In the second half of
2014, 411 thousand people received disability and rehabilitation benefits, for an
average value of HUF 67 thousand. The basic income of HUF 50 thousand is
guaranteed also in their case, which may mean a benefit supplement for
approximately 150 thousand people. Social transfers above the value of the basic
income will remain intact. In the case of full-time students in tertiary education the
basic income of HUF 50 thousand may replace, for example, the existing social-
based scholarships. Adult working-age population not belonging to any of the
above groups, that are passiveunemployed persons or active jobseekers, will
receive a basic income of HUF 50 thousand until retirement age.
One of the novelties of our proposal concerns the fourth group, the working
population. Taking into consideration the 2015 minimum wage level (net HUF
68,775 = EUR 220) the basic income of a worker in an employment relationship will
be net 100,000 HUF. This can be achieved through raising thenet minimum wage
which requires only a single modification to the current regulation. A means for
this is the negative tax that will top up the net wage to the level of basic income
Gábor Scheiring, Miklós Sebők, Bence Tordai
and deduce the sources required for this income supplement from the personal
income tax (PIT) paid by the worker and of the social contribution paid by the
At the minimum wage level, this means that the obligation to pay PIT will cease
to exist, while the employer will transfer HUF 31,225 not to the state but to the
employee. As a result of the proposal the income received by the employee will
increase from the current HUF 68,775 to HUF 100,000. These changes, however, will
not affect employers in any way: the costs of employment remain unchanged.
Table 1 contains a comparison between the current and the proposed minimum
wage structure.
Table 1 The impact of the HUF 100 net minimum wageon personal income
HUF 105,000
HUF 105,000
Total employer's cost
Total employer's cos
All employee
All employee
Net wage
Net wage
Basic income
Basic income
Negative tax
Income supplement
+ tax credit
Employer's net
Employer's net
Individual's net
Individual's net
Net budgetary
Net budgetary
Proportionally to the increase of the taxable income (that is, the basis for PIT
payment) the wage supplement released from the social contribution will be
replaced by tax credits. According to 2015 data, this replacement will reach its
maximum at a gross wage of HUF 200 thousand. The upper limit for the full use of
basic income can be drawn somewhere above the average wage, above which the
tax credits can be gradually phased out. In the case of half-time employment, 80%
of the basic income (HUF 40,000) will be guaranteed.
Basic Income as a Realist’s Transformative Strategy
4. Budgetary implications
In this section we present detailed financial evidence that the proposal can be
introduced immediately without impairing the balance of the budget. The
introduction of a significant, comprehensive public policy programme such as basic
income cannot occur without similarly important budgetary rearrangements. Table
2 presents in detail the cost of the basic income for each eligibility group. Here we
do not elaborate on each category in more detail, our estimations are all based on
current budgetary expenditures and population data provided by the Central
Statistical Office.
Table 2 Budgetary impact of the proposal
Form of basic
income Eligibility group
Number of
Gross change
(bn HUF)
25 thousand/month
Minor (under 18 years)
Top-up to 50
Pension and pension-type
Including: old-age with under 50k
30,000 4
Including: on disability allowance
Including: annuities (disability,
rehabilitation, etc.)
40,000 8
50 thousand/month 18 + (including 200k public
1,005,000 510
Including: on jobseekers'
Top-up to 50
On scholarship 123,386 27
75 thousand/month
Income supplement
With wage income and social
4,235,231 390
Tax credit
With wage income and social
security 4,235,231 585
The costs of the introduction of the basic income scheme will be covered by six
main sources of funding: expenditure replaced by the basic income; the restoration
of a fair tax system; additional revenues stemming from the introduction of the
basic income; measures against wasteful public spending; a progressive change in
economic policy; and anti-corruption action.
More than half of the costs of the introduction of the basic income can be
financed through the reform of social expenses and of the PIT scheme.
Accordingly, a decisive part of the coverage for the basic income of minors could
Gábor Scheiring, Miklós Sebők, Bence Tordai
derive from restoring the upper income tax rate and eliminating family tax benefits,
not available to low-income families and families with no wage income. The
situation is similar in the case of the transformation of social spending: it provides
ample coverage for the basic income of persons over 18 without wage income and
of expectant mothers.
The third and also the largest item is the introduction of the HUF 100 thousand
net wage. This can be financed through reducing the money that goes into the
public work programme, eliminating the redundant or even harmful public
expenses (such as the planned extension of the Paks nuclear power plant), and
savings and revenue increases available through the action against corruption.
The increase of the net minimum wage to HUF 100 thousand is embedded into
a more general progressive change in economic policy. This will reduce deductions
on work, while restricting economic support for tax-evading, polluting or restricted
groups. There will always be winning bidders at public procurement tenders
however, the tax imposed on the biggest winners will force those receiving the
majority of government orders to assume an extra tax burden. The overall
improvement of the economy as a result of the introduction of the basic income
creates a macro-economic climate in which, according to the estimates of standard
macroeconomic models, several billions in VAT and other budgetary revenue can
be obtained.
The overall reform to the budget is 2160 billion HUF on the expenditure side
and a similar amount on the revenue side which equals to a 15 percent reshuffling
of the total national budget. An intervention at this scale is without precedent but
we designed our scheme so that it could be implemented immediately. Table 3
represents the main sources of revenue in detail.
Table 3 A detailed breakdown of the sources of basic income (billion HUF)
I Expenditures lower than the basic income
Small amounts of aid
Family allowance
Child care allowance 62
Child raising support
Maternity allowances
Cash and in-kind child protection allowance
Care allowance
Free public healthcare 18
Means-tested compensation fund
Supplements to certain wage subsidies paid by local governments 13
Childcare fee/Childcare fee extra
II A fair tax system
Restoration of upper PIT rate
Family tax benefit (personal income tax) 255
Basic Income as a Realist’s Transformative Strategy
Family tax benefit contributions
III Macroeconomic effects
VAT surplus revenue
IV Measures against wasteful public spending
Capital increase of Paks II. Nuclear Power Plant Development Private Company Limited
by Shares
Cost reduction at unnecessary institutions (Hungarian Academy of Arts, Counter-
terrorism Centre, Office of the Prime Minister) 15
Sport development concepts
National Stadium Development Programme
National Olympic Centre
Administrative savings through the introduction of a basic income 0.1
Public media
Cost reduction of 20% of the Investment Fund
V A progressive change in economic policy
Public Sector Wage Compensation Scheme becomes redundant
Phasing out of Start/Public work programme
Special tax on financial institutions
Restriction of corporate income tax benefits, cutting the tax benefits on capital income 145
Legalization of shadow employment (as a result of the reduction of the tax wedge
between minimum wage and average wage) 15
The nominal restriction of the expenditure of public economic function
Excise tax increase, modification of fuel subsidies
VI Anti-corruption action
Fight against VAT fraud 75
Special tax on public procurement 15
Action against offshore tax evasion 25
Area-based land tax 28
Improved tax collection through advanced enrichment tests
5. Social effects
The first and most important thing to know about the basic income is that the
vast majority of Hungarian citizens residing in Hungary will be better off with it.
Table 4 shows according to types of households how disposable income would
vary in terms of gross wages, replaced transfers, a progressive PIT table and the
introduction of the basic income. The table shows that up to twice the amount of
average income everybody wins with the basic income, the extra burdens will affect
only the upper 10-20% of the population, those who earn more than twice the
amount of average income. Our estimations are based on publicly available income
statistics and on an income tax system with more than one tax rate. Lowest rate: up
to the minimum wage there is no income tax; second rate: from the minimum
wage up to approximately twice the average wage the current 16 percent rate
applies; third rate: from approximately twice the average wage a 30 percent tax
rate applies.
Gábor Scheiring, Miklós Sebők, Bence Tordai
Table 4 The impact of basic income on monthly household incomes (HUF)
Type of household
Gross monthly
earnings Net variation of the household income
No children
1 dependent
2 dependent
Couple earning above average 800,025 38,000 30,000 -1,000
Couple earning an average salary 251,459 29,000 27,000 11,000
Couple earning less than the average
166,084 49,000 65,000 83,000
Single parent earning below the
average wage
201,101 57,000 33,000 37,000
Single, working-age, with income
from emoluments only
29,000 29,000 29,000
Apart from the primary redistribution effects the introduction of basic income
will have a number of other direct and indirect positive public policy impacts:
In the short term it will reduce by half the number of people living in
poverty. According to the calculations by the LÉT Working Group (2014),
the poverty rate might fall from 16.4% to 8.6%, the proportion of people
living below the subsistence level might fall from 40.7% to 29.1% with the
introduction of a basic income similar to the one presented in our
It will result in a significant stimulus to domestic demand. The lack of
solvent domestic demand is the main obstacle to Hungarian economic
growth. The introduction of a basic income, if we take everything else as
given, can cause a significant expansion in household consumption,
primarily on behalf of those earning under the average wage, while the
reduction of the consumption of very high wage earners will be limited.
The introduction of basic income creates new incentives for employment,
in particular legal employment. The radical raise in net minimum wages
might guide masses of inactive population back to the labour market.
Commuters can afford to buy a monthly pass, there will be financial
resources for job search (telephone, internet, postage, travel, etc.) while the
measure will create a solvent demand and also a demand for labour force
for SMEs.
Replacing the current, non-transparent, discretionary system of benefits,
where means-testing is often arbitrary and unpredictable, with a simple
and transparent system of basic income will bring about substantial
administrative cost savings. The often humiliating forms of assistance will
be replaced by an automatic remuneration, ensuring equal dignity.
Over the past half-decade hundreds of thousands of young Hungarian
citizens abandoned the country. The basic income is a first step to reverse
this tragic process. The radical recapitalizationof scholarships makes
Basic Income as a Realist’s Transformative Strategy
university and college studies more accessible for students from less
affluent families. Job growth and the higher starting salaries, a greater
contribution to the costs of having children could keep low-skilled young
people at home, or can convince them to return to Hungary.
6. Conclusion: Basic Income in Europe
In this chapter we have elaborated a politically and financially viable basic
income scheme. According to our proposal the basic income would range from
HUF 25,000 (ca. EUR 80) up to HUF 100,000 (ca. EUR 330) divided into four
eligibility groups. The essence of the proposal is the sequence of 25-50-75-100,
which means the monthly benefit of each eligibility group in thousand forints.
Everyone will be entitled to at least this amount of basic income, in parallel of
which current transfers below the level of the basic income would be phased out.
The total annual cost of the introduction of the basic income for the four eligibility
groups would be around HUF 2,200 billion, almost half of which would be
transferred to those with declared jobs. The costs of the introduction will be
covered by six main sources of funding including the elimination of some of the
existing social assistance programmes as well as introducing various new taxes on
capital and a progressive income tax.
Of course, a guaranteed income does not solve all problems of the deprived.
Further development of public services such as health care, education and access
to drinking water and sanitation are also needed to enable every citizen of the
country to participate in society. However, we are convinced that a basic income
scheme would not only represent a completely new structure of social policy, a
progressive structural transformation instead of socially and economically
unsustainable structural adjustments, but it represents the basis of a new
progressive social vision as well. A vision based on equality and a society that helps
all members to realize their potentials and develop their capabilities. The basic
income offers a new progressive vision that rescues institutional solidarity and
social citizenship (Marshall, 1950) and transforms it to suit the economic realities of
contemporary capitalism (Esping-Andersen, 2002).
Though our approach might appear as a step back from its original
progressivity it is still able to half poverty, increase employment and provide a
sense of basic security for everyone. Our proposal is designed to be attractive for
the majority of the society, both for the precariat and for the working middle
classes. Our intention was to increase the viability of the scheme without sacrificing
its essence to provide a basic security net for everyone. Further work is needed to
elaborate the details of each eligibility category as well as to adapt the scheme to
other countries. Further policy research and political work could uncover additional
sources of financing, like international financial and wealth taxes and which would
Gábor Scheiring, Miklós Sebők, Bence Tordai
allow a higher basic income than the current scheme. Our proposal is directly
implementable, financially sustainable and politically viable: a transformative
strategy with a capacity to bring Hungarian society much closer to an egalitarian
For the sake of clarity we chose to focus on one country, Hungary. However,
the European Social Model is under pressure throughout the continent with social
polarization and precariousness on the rise in the whole EU. Therefore, some form
of basic income would be desirable throughout Europe: instead of centrally
imposing a regime of structural reforms upon countries the EU should promote
structural transformations that equalize life chances. Since welfare and social
policies are mainly in the hands of the national governments and because the
social and financial situation varies across countries to a large extent there is no
top down model of basic income in Europe. Philip van Parijs (2013) one of the main
theoreticians of the basic income proposed an EU wide solution: The Euro
Dividend. This EU level basic income could vary from country to country to track
the cost of living, and also can vary according to age group. As van Parijs suggests,
the Euro Dividend could be financed by the Value Added Tax, to fund a Euro
Dividend averaging 200 Euros per month for all EU residents, one needs to tax the
EU’s harmonized VAT base at a rate of about 20%. However, by following a multi-
dimensional basic income scheme as elaborated in this chapter the cost of the
Euro Dividend would be much lower. As elaborated in our proposal there could be
other sources as well to finance the Euro Dividend, like a future European tax on
financial transaction, taxes on luxury goods, or carbon emission allowances as well
as combining the introduction of basic income with progressive income and capital
taxation. Transforming the idea of quantitative easing into quantitative easing for
the peopleopens up the possibility to finance basic income through the European
Central Bank. Instead of the ECB injecting money into the financial markets the new
money created by Eurozone central banks could be used to finance €175 per
month citizens income as proposed by 19 economists in a letter to the Financial
Times (2015).
There is political grounding of a universal basic income at the EU level in the
existing EU acquis communautaire. The Charter of Fundamental Rights, the Article
2 of the Treaty on the European Union on human dignity and equality as well as
Article 3 on social exclusion and social justice provide a theoretical frame for a
European Basic Income. There is a base for the coordination of member states’
social policies and in matters of employment as well which can be extended
towards basic income. Minimum income schemes already exist throughout Europe
to a varying extent, harmonizing these social policy tools is feasible at the EU level
and would equal to a major EU wide social policy brake trough. Based on these
principles the European Citizen’s Initiative for an Unconditional Basic Income aimed
to urge the Commission to support the idea of the EU Basic Income. Although the
Citizens Initiative did not manage to collect 1 million signatures needed for the
petition to be legally binding but it managed to put the issue on the agenda
throughout the EU. Recently the idea of Quantitative Easing for the Peoplegot
Basic Income as a Realist’s Transformative Strategy
increasingly popular both among activists and experts as well. Building on this
momentum the idea of the EU level basic income can be brought forward.
A bold new European system of basic income might help the EU to get closer
to a truly social Europe, a Europe of the citizens for the citizens. As van Parijs put it
in an interview after the conference on the Unconditional Basic Income (UBI)
organised in the European Economic and Social Committee:
It’s very important for the EU to be perceived by the people as a caring
union, not only one that lifts protection to promote productivity and benefits
for Europeans in a very unequal way. It must be perceived (by) all the
Europeans, not only the movers, but also the stay-at-homes, that the EU is
doing something for them.(, 2014)
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Euractiv.Com. (2014). Van Parijs: An unconditional basic income in Europe will help
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For two decades Hungary, like the other Eastern European countries, followed a general policy of establishing and strengthening the institutions of democracy, rule of law, and a market economy based on private property. However, since the elections of 2010, when Viktor Orbán's Fidesz party came to power, Hungary has made a dramatic U-turn. This article investigates the different spheres of society: political institutions, the rule of law, and the influence of state and market on one another, as well as the world of ideology (education, science and art), and describes the U-turn’s implications for these fields and the effect it has on the life of people. It argues against the frequent misunderstandings in the interpretation and evaluation of the Hungarian situation, pointing out some typical intellectual fallacies. It draws attention to the dangers of strengthening nationalism, and to the ambivalence evident in Hungarian foreign policy, and looks into the relationship between Hungary and the Western world, particularly the European Union. Finally, it outlines the possible scenarios resulting from future developments in the Hungarian situation.
Conference Paper
Neoliberalism, stemming from the musings of the Mont Pelerin Society after the Second World War, meant a model of liberalization, commodification, individualism, the privatization of social policy as well as production, and – least appreciated – the systematic dismantling of institutions and mechanisms of social solidarity. From the late 1970s onwards, it meant the painful construction of a global market system, in which the globalization era was the disembedded phase of the Global Transformation, analogous to a similar phase in Karl Polanyi’s Great Transformation. In both cases, the disembedded phase was dominated by financial capital, generating chronic insecurities and inequalities. But whereas Polanyi was analysing the construction of national markets, the Global Transformation is about the painful construction of a global market system. One consequence has been the emergence of a global class structure superimposed on national structures. In order to move towards a re-embedded phase, it is essential to understand the character of the class fragmentation, and to conceptualize the emerging mass class-in-the-making, the precariat. This is a controversial concept, largely because traditional Marxists dispute its class character. However, it is analytically valuable to differentiate it, since it has distinctive relations of production, relations of distribution and relations to the state. It is still a class-in-the-making rather than a class-for-itself. But it is the new dangerous class because it is a force for transformation, rejecting both labourist social democracy and neoliberalism. It has a distinctive consciousness, although it is this that holds it back from being sufficiently a class-for-itself. It is still divided, being at war with itself. However, it has moved out of its primitive rebel phase, and in the city squares around the world is setting a new progressive agenda based on its insecurities and aspirations.
Capitalist societies are full of unacceptable inequalities. Freedom is of paramount importance. These two convictions are widely shared across the world. Yet they often seem in complete contradiction with each other. Fighting inequality jeopardizes freedom; taking freedom seriously boosts inequality. What can be done? Can the circle be squared? Philippe Van Parijs offers a ground breaking solution to the dilemma. Assessing and rejecting the claims of both socialism and conventional capitalism, he presents a clear and compelling alternative vision of the just society: a capitalist society offering a substantial unconditional basic income to all its members. Moving beyond pure political theory, Van Parijs shows what his ideal of free society means in the real world by drawing out its controversial policy implications. Real Freedom for All will be essential reading for anyone concerned about the just society and the welfare state as we move into the twenty first century. Available in OSO: