COVID-19 is both a public health crisis and an economic crisis. The measures taken to deal with the public health crisis threaten our economic well-being.
There is near unanimity among economists that the response to the coronavirus-induced recession must be aggressive. As stated by the subtitle of a new e-book on how to respond to the COVID-19 recession: Act Fast and Do Whatever It Takes.
Immediate implementation of a universal basic income combined with a job guarantee would help address our current economic problems and the public health crisis. The policy combination could also help us deal with climate change, which is both an ecological and economic crisis.
Current government response
For now, the government of Canada has chosen to rely on expanding existing programs such as Employment Insurance and the Canada Child Benefit. But these programs have pre-existing shortcomings, asnoted by Sheila Block, senior economist with the Canadian Centre for Policy Alternatives.
Not all workers in the so-called gig economy qualify for EI. And many of these workers have lost all of the gigs that kept them financially afloat.
A universal basic income could provide financially precarious people with the money they need. And it would keep money flowing through the financial system.
Lessons from 2008 recession
The 2008 global financial crisis showed what happens when the money stops flowing. Deeply interconnected financial institutions seize up and threaten to collapse.
It tookmassive interventionby the United States Federal Reserve to prevent a cascade of bank failures. The Feds actions saved the financial institutions that created the problem but did nothing for the people losing houses and jobs. A basic income plan can be part of rectifying that mistake.
Calls for a universal basic income are coming from diverse quarters. Ken Boessenkool, a Conservative activist,demands itin bothMacleansandthe Globe and Mail, although he stipulated its a bad idea in normal times.
Petitionsdemanding a basic incomeare circulating on social media.
The call by some conservatives for a basic income isnt actually surprising.
Some advocates argue that its pro-free market policy because it prioritizes individual choice. Thats why prominent free marketeer Milton Friedmanadvocated a negative income tax, which is a form of universal income.
Somebasic income critics argue, however, that it would justify eliminating public institutions in favour of corporations. For example, opponents of government spending could target publicly funded education as no longer necessary because individuals can use their basic income to choose among private options.
U.S. Congresswoman Alexandria Ocasio-Corteztweeted her concernthat a non-emergency basic income could harm vulnerable populations by eliminating other important government programs. Ocasio-Cortez added her advocacy for job guarantees, which she promotes aspart of a Green New Deal.
A job guarantee is not a new idea. A right to employment was part of U.S. President Franklin D. Rooseveltseconomic bill of rights. The Democratic Party included full employment in its1980 presidential platform.
Full employment doesnt fuel inflation
The pursuit of full employment was pushed out of the political mainstream and into the economic margins by economists who argued that if unemployment was pushed too low it would cause inflation to rise out of control.
In the decade since the global financial crisis, the unemployment rate in both Canada and the U.S. has steadily decreased. Until the current COVID-19-induced recession, unemployment was at a historical low. And yet, forecasted runaway inflation did not occur.
For decades before the financial crisis, the government did not intervene to increase employment. Relying on the advice of economists, they unnecessarily condemned millions of people to the misery of unemployment.n
With low unemployment and stable inflation, advocates of full employment have spurred public interest in a job guarantee. Levy Institute researcher Pavlina Tcherneva is a particularlyprominent proponent. Its also a key component of theModern Monetary Theorythats earned a lot of attention in debates about funding a Green New Deal.
Flattening the job loss curve
The precautions taken to flatten the curve of COVID-19 have pushed millions of people out of work. Yet there is an untold number of tasks that need to be accomplished to keep society functioning.
What if we hired artists to make posters extolling the virtues of hand-washing? Or photographers to produce glamour shots of our heroic grocers? What if we hiredlaid-off flight attendantsto help manage crowds at COVID-19 testing centres? Or hiredlaid-off autoworkersto deliver groceries to the quarantined?
A universal basic income ensures that no one feels forced into work. But most people want to contribute to society in a useful way. A job guarantee ensures that everyone who wants a job has one.
Dealing with the COVID-19 recession requires us to create jobs that the profit-driven private sector will not. The same is true of the climate crisis.
Much of what needs to be done to transition from our current economy to a sustainable economy will not be profitable. That means the private sector will not take it on of its own accord. Government will need to fund the transition and the incredible number of jobs needed to accomplish the task.
David Andolfatto, a vice-president at the U.S. Federal Reserve, described the economic effects of COVID-19 responses as a planned recession.
Decision-makers knew actions taken to deal with COVID-19 would produce a recession. Given the planning to cause the recession, it is reasonable to use planning to mitigate its harms. That mitigation will allow us to begin the economic transformation well also need to address the climate crisis.
[Our newsletter explains whats going on with the coronavirus pandemic. Subscribe now.]
D.T. Cochrane, Economic Researcher, York University, Canada
This article is republished fromThe Conversationunder a Creative Commons license. Read theoriginal article.
See the article here:
- Artist Basic Income Take Me Somewhere - September 8th, 2022
- Universal Basic Income fails to get to the root of urban poverty - 2UrbanGirls - September 8th, 2022
- GROUNDUP OP-ED: Basic income grant separating the facts from the populism - Daily Maverick - September 8th, 2022
- What labour and trade union agenda should the new Colombian government and Congress pursue? Here are some proposals - Equal Times - May 12th, 2022
- Finland's hugely exciting experiment in basic income ... - December 27th, 2021
- Get creative to help artists through pandemic - The Guardian - February 11th, 2021
- BC has better tools than universal basic income to create a more just society, report finds - UBC News - February 1st, 2021
- Universal basic income has time come for it? Debate intensifies in pandemic - WRAL Tech Wire - December 3rd, 2020
- Basic income for all: Has the Covid crisis given us a new economic model? - The Irish Times - December 3rd, 2020
- What is the Liveable Income Guarantee, and how could it affect you? - Yahoo Finance Australia - October 8th, 2020
- Two Years of Duques Colombia: Deepening Neoliberalism, Increased Violence and a Public Health Crisis - NewsClick - August 13th, 2020
- Why Kamala Harris VP pick could cost Biden the election - Fox Business - August 13th, 2020
- Magic Reports Second Quarter and First Half 2020 Financial Results with Record-Breaking Operating Income of $9.8 million, reflecting a 22% Year Over... - August 13th, 2020
- Why We Should Turn to Earned Income Tax Credit to Aid Those Struggling Through Pandemic - The National Interest - August 8th, 2020
- Millions of America's working poor may lose out on key anti-poverty tax credit because of the pandemic - The Conversation US - August 7th, 2020
- Could $50 a Week Empower High School Students to Set and Meet Education Goals? This New Orleans School Aims to Find Out - redlakenationnews.com - August 7th, 2020
- Heres How We Remake the Economy - Common Dreams - August 5th, 2020
- VOICE OF THE PEOPLE July 31, 2020 - TheChronicleHerald.ca - July 31st, 2020
- Health unit calls for universal basic income - The North Bay Nugget - July 30th, 2020
- Job guarantee program could bolster economy more than ... - July 27th, 2020
- The Gray Market: Why the Entire Art World Should Back Canadian Arts Workers Push for Universal Basic Income (and Other Insights) - artnet News - July 26th, 2020
- Extra $600 unemployment benefits set to expire this weekend - WKOW - July 25th, 2020
- Why Now is the Time to ACT on KUB - SACE - Clean Energy News - July 25th, 2020
- What is Basic Income? | Guaranteed Universal Basic Income - July 25th, 2020
- ECLAC calls for urgent regional cooperation beyond the pandemic to foster more integration and avert a food crisis - Dominican Today - July 25th, 2020
- 'A recovery that puts people first': A group of young Australians is demanding a government job guarantee to fight both soaring unemployment and... - July 24th, 2020
- Analysis: Behind the legal maneuvering in the Reclaim Idaho initiative - Idaho EdNews - July 24th, 2020
- In the wake of Covid-19, time to consider basic income: Senate report - Investment Executive - July 21st, 2020
- COVID-19 on P.E.I.: What's happening Tuesday, July 14 - CBC.ca - July 21st, 2020
- COVID-19 on P.E.I.: What's happening Monday, July 13 - CBC.ca - July 20th, 2020
- Lift Every Voice: The Urgency of Universal Civic Duty Voting - Brookings Institution - July 20th, 2020
- Largest cities in Colombia reverse reopening as coronavirus threatens to collapse healthcare - Colombia Reports - July 17th, 2020
- GST: The increase Australia doesn't have to have Monash Lens - Monash Lens - July 15th, 2020
- Bogot returns to strict quarantine based on rotating localities as of July 13 - The City Paper Bogot - July 11th, 2020
- Why a Universal Basic Income is the solution to inequity - Women's Agenda - June 22nd, 2020
- Crypto Experts Reveal Thoughts: How Will Bitcoin Perform After the COVID-19 Crisis Has Passed? - PRNewswire - June 22nd, 2020
- Interviews: Punks on Politics: Checking in with Mel Gagarin - Punknews.org - June 22nd, 2020
- COVID-19: UN agencies warn against rising hunger in Latin America and the Caribbean - UN News - June 22nd, 2020
- Universal Basic Income: Andrew Yang Was Pushing for It Long Before Coronavirus Pandemic - PopCulture.com - May 9th, 2020
- Coronavirus is a crisis for the developing world, but here's why it needn't be a catastrophe - The Guardian - May 9th, 2020
- Starvation in the time of Corona: momentum for the Universal Basic Dividend - DiEM25 - May 9th, 2020
- Adam Schiff Says Trump's Cult of the President Has Infected the Republican Party - Mother Jones - May 9th, 2020
- Common Arguments Against Basic Income Don't apply to the Emergency BI - Basic Income News - March 31st, 2020
- I've lived through plenty of social shocks this time we must learn the lessons - The Guardian - March 31st, 2020
- Coronavirus: Iain Duncan Smith says dont bring in universal basic income during pandemic as it would be disincentive to work - The Independent - March 26th, 2020
- Solidarity Economicsfor the Coronavirus Crisis and Beyond - The American Prospect - March 26th, 2020
- We face a war against coronavirus and must mobilise accordingly | Free to read - Financial Times - March 26th, 2020
- Lockdown to fight coronavirus is going to hit most Indian workers very hard - Livemint - March 26th, 2020
- Beware of a lopsided lockdown - The Hindu - March 26th, 2020
- Life, Liberty, and Basic Income | Opinion - Harvard Crimson - February 29th, 2020
- Find ways to improve the revenue of farmers: Congress - The Hindu - January 30th, 2020
- Eliminating Child Poverty With a Government Check - The New York Times - January 30th, 2020
- Andrew Yang Expects 'Many' of His Supporters to Back Sanders in Iowa: We 'Have a Lot of Overlap' - Newsweek - January 30th, 2020
- Trump to let states overhaul Medicaid for the poor, seeking to change Obamacare without legislation - Washington Examiner - January 30th, 2020
- P.E.I. groups say basic Income should not replace addictions, other supports - The Journal Pioneer - January 27th, 2020
- 5 Psychological Forces That Turn People into Political Hacks | Aaron Pomerantz - Foundation for Economic Education - January 13th, 2020
- WAYNE YOUNG: Island voices must be heard - The Guardian - December 15th, 2019
- The Guardian view on Finlands new PM: a different type of leadership - The Guardian - December 15th, 2019
- Basic Income as 40 Acres and a Mule - Basic Income News - October 16th, 2019
- 'Most Americans Don't Want To Work for the Federal Government' Says Andrew Yang, Trashing Federal Jobs Guarantee - Reason - October 16th, 2019
- Democratic debate highlights: best and most substantive answers of the night - Vox.com - October 16th, 2019
- Sanders: 'Damn right we will' have a job for every American | TheHill - The Hill - October 16th, 2019
- Assembly Elections 2019: Why is the Congress evasive about NYAY scheme this poll season? - Moneycontrol.com - October 16th, 2019
- Letter to the Editor: Universal basic income is inevitable as we head toward a fully automated society - The Post - October 16th, 2019
- Democrats focus on some Midwestern issues at Westerville debate, a departure from past three forums - cleveland.com - October 16th, 2019
- New book reviews the Namibian Basic Income pilot - Basic Income News - October 1st, 2019
- Quick notes from Basic Income Guarantee Panel - falicon.com - January 28th, 2019
- 'Hartz reforms': how a benefits shakeup changed Germany ... - January 28th, 2019
- Basic income could end food insecurity - Upstream - January 3rd, 2019
- Basic Income Guarantee - Your Right to Economic Security ... - November 8th, 2018
- The Ethics and Economics of the Basic Income Guarantee ... - September 18th, 2018
- Is a Basic Income Guarantee the Right Choice for Ontario? - June 27th, 2018
- Basic Income Now | It's time for dignity for all - March 17th, 2018
- 'Me too' and the basic income guarantee | Basic Income News - February 6th, 2018
- Food shopping at dollar stores | Brantford Expositor - Brantford Expositor - August 24th, 2017
- How Cities Can Rebuild the Social Safety Net - CityLab - August 24th, 2017
- After lifting minimum wage, NDP government prepares to consult public about reducing poverty - Straight.com - August 16th, 2017
- Universal Basic Infrastructure to help decrease India's poverty - Economic Times - August 14th, 2017
- New Zealand Fabians host Basic Income panel - Basic Income News - August 13th, 2017
- Hashtag Trending Battery-free phone, Apple's China backlash - IT World Canada - August 10th, 2017