Mike Phipps

Free money, more leisure and other reasonable ideas

Mike Phipps

History has shown that the search for utopias can be dangerous, leading to dictatorship, even genocide. But the abandonment of the search is also fraught. The idea that modern capitalism is about the best we can do is, as Ralph Miliband once said, a slur on the human race. 

But this delusion persists, even after the Great Crash of ten years ago. For the elites, politics remains, as in the boom years, about problem management - reducing deficits, encouraging growth. Only the symptoms, rather than the fundamental causes of the problems inherent in the system, are addressed. The dominant ideology, Liberalism, hollowed out, has been reduced to the freedom to consume. 

Unsurprisingly, society’s dominant ideas are ones that validate capitalism. Yet Rutger Bregman has some arresting facts. “For every pound earned by advertising executives, they destroy £7 in the form of stress, over-consumption, pollution and debt; conversely, each pound paid to a trash collector creates an equivalent of £12 in terms of health and sustainability.” Likewise, for every dollar a banker ‘earns’, 60 cents is destroyed elsewhere in the economic chain, whereas for every dollar earned by a researcher, at least $5 is pumped back into the economy. 

People are well aware when they are doing meaningless work. A 2014 Yougov poll found that 37% of British workers felt they were doing a job that didn’t need to exist. If in doubt, go on strike. A withdrawal of labour by New York garbage workers led to an immediate environmental health crisis and a state of emergency, which would not happen if overpaid lobbyists and bankers struck. The case for higher taxes - not just on the rich because they can afford it, but to get more people into useful work - could not be clearer.

Bregman’s aim is to make utopian ideas look reasonable. His big idea - popularised in a TED talk filmed in April 2017 and with well over a million viewings on the Internet - is to give free money to people. A universal basic income is not just a nice idea: evidence shows it would be cheaper to operate than the cost of dealing with homelessness and attendant health issues or policing the benefits system, and would actually make people more productive.

The idea is not so utopian as might be thought. US policymakers took the idea seriously in the 1970s, impressed with evidence about improved health and school performance. It was abandoned when opponents highlighted spiralling divorce rates in areas where such schemes had been trialled. With the rise of the Christian right, a policy that gave too much independence to women was unthinkable.

In the years since, the focus on “helping the poor” has been spectacularly unsuccessful, not least because it deepens the wedge between them and the rest of society. “A policy for the poor is a poor policy,” observed Richard Titmuss, the theoretician of Britain’s welfare state. Universal approaches work better and increase social solidarity. 
That requires proper funding of public services. But countries with a large public sector, as in Scandinavia, also score high on well-being indicators - as do countries with less inequality. States with the highest rates of depression, school dropout, drug abuse, obesity, low electoral turnout, social and political distrust are also the most unequal. 

High on this list is the US, not a poor country in world terms. But inequality has social consequences, greater bullying for example. that contribute to stress, poor health and other problems. The IMF says that too much inequality even limits economic growth. And even richer people, findings show, suffer psychologically in highly unequal societies.

Yet even as production grows, median wages are declining significantly. The reason is simple: labour is less scarce, partly due to increased mechanisation. Scholars estimate that nearly half of all US jobs and a third of those in Europe are at high risk of being usurped by machines in the next 20 years. 

Hence another of Bregman’s ‘utopian’ ideas: a drastic shortening of the working week and expansion of leisure time. There’s lots of evidence that a shorter workweek need not hit productivity - rested workers are more efficient. Even Ted Heath’s notorious three day week during the 1974 miners strike caused a fall in production of only 6%. Less work means less stress, less unemployment, less climate change, fewer accidents, more gender and social equality.

As with domestic anti-poverty programmes, much international aid can be hit and miss. Bregman identifies one single measure that could eliminate global poverty: open borders. In an era of globalisation, only 3% of people live outside the country of their birth. Billions of people are forced to sell their labour at a fraction of what they would get in a developed country, a key driver of global inequality. Opening borders would generate an estimated $65 trillion in wealth.

Open borders sounds truly utopian. But most concerns that have been raised against it don’t withstand scrutiny. There’s little evidence that open borders increase terrorism or criminality or depress wage rates. Even the idea that diversity undermines social cohesion has been debunked - it’s the disadvantages that people in diverse communities face that undermines trust. And open borders mean that migrants, knowing they are free to come and go, are more likely to return to their country of origin. Instead, the opposite is happening: “three quarters of all border walls and fences were erected after the year 2000.”

So this is a book about redistribution - of money, time, tax and people. But it’s also accessible and optimistic: Bregman has said in interview that Martin Luther King didn’t gain support by saying, “I have a nightmare.” The left needs to reclaim the language of hope and progress - talking about reform, meritocracy - paying people according to their real contributions - innovation and efficiency. Jeremy Corbyn understands this when he talks about the waste that results from poverty. The gap between utopia and power is closing fast.