Why the call for an unconditional basic income is misleading

May 12, 2020

The corona pandemic is associated with severe losses for the working class. Many people affected by short-time work, but also small self-employed and unemployed people face poverty, others face the risk of losing their jobs. According to an Ifo survey, 18% of German companies plan to cut jobs or not to extend fixed-term contracts [1]. From March to April, the number of unemployed rose particularly sharply with over 300,000 new registrations. Overall, the number of unemployed in Germany is officially more than 2.6 million. [2] It has long been known that these figures are [not] calculated correctly. The actual number is likely to be around 3.5 million unemployed [3].

Since the outbreak of the corona pandemic, the discussion about the unconditional basic income (BGE, Bedingungslose Grundeinkommen, german acronym, Translater’s Note) has been in full swing again. According to an INSA survey [4], 51% of Germans are in favor of a BGE. A petition calling for the introduction of the BGE is “the most successful online petition that has ever been addressed to the Bundestag” with 176,134 signatories [5], [6]. Many associate the BGE with the hope of overcoming their fears of existence and their isolation.

At first glance, what looks like a gift turns out to be an instrument of the rulers to increase profits and hold down the working class. To understand how this tool works, we need to take a look at capitalist commodity production and the wage system.

Exploitation, wages and reproduction

Capitalist commodity production is based on the contradiction between capital and labor. Workers want as much wages and free time as possible, the capitalists want the highest possible profits. The worker sells his labor power to the capitalist and produces goods for him. The capitalist pays the worker a fraction of the value of these goods as wages and appropriates most of it, the surplus, privately. The capitalist derives profit from this added value. The wages paid to the worker must at least be sufficient for his reproductive costs – that is, he must be able to buy food that he needs to maintain his labor. In order for the capitalist to have enough workers at their disposal, they must have enough food to survive, but also to raise their children, so that new workers can follow. If wages fall below the cost of maintaining labor, the production of goods and thus the capitalists’ profits are no longer guaranteed.

Since wages are partly below this limit, the state must step in and subsidize workers’ wages. This is the purpose of child benefit, for example, or the job center increasing low incomes. The capitalist can thus give the workers a smaller part of the produced value and thus increase his profit. This is financed from taxpayers ‘money, which to a large extent is paid from workers’ wages. With this subsidy from taxpayer money, the capitalists indirectly acquire part of the wages of the workers.

The representatives of the BGE

The discussion about unconditional basic income is not new. In Germany, it developed with the introduction of the Hartz laws in the mid-2000s. Proponents of the BGE can be found from reactionary business elites to the communist spectrum. Even if the proposed models differ, the basic idea remains the same: a lump sum for everyone without a means test as an elementary component of social security. Whether the BGE should serve as a supplement to the existing social insurance or as a replacement, who should get it, how high it is set and from what funds the BGE should be financed are the main parameters for differentiating between different models.

It is clear that the funds for the BGE/UBI must come from the production of goods through human labor, since in capitalism this is the only way to create value. The BGE must therefore be paid either from the wages of the workers or from the profits of the capitalists.

Supporters of the capital side are proposing to finance the BGE through higher taxes on everyday consumer goods. They include DM boss Götz Werner, but also investors in large banks or hedge fund managers. [They] are committed to paying the cost of the BGE out of wages and not out of profits. It is a matter of introducing a wage subsidy, which is paid for by the workers themselves, similar to child benefits. If the entrepreneurs’ models are followed, the introduction of the BGE is also intended to stamp out the welfare state. People would then have to take care of health and pension insurance privately.

The BGE would therefore be a welcome measure for parts of the capital. Because in capitalism, the increase in productive forces is always accompanied by the release of human labor. But since added value can only be gained from human labor, profits decrease when less human labor is used in production. In order to keep profits stable, wages have to be lowered. The BGE is supposed to ensure that the reproduction of the labor force remains guaranteed, while wages are continuously reduced.

Left-wing advocates argue that a BGE/UBI would enable people to live independently as unpaid work would be rewarded with the BGE/UBI. In addition, a sufficiently high level of basic services would strengthen the workers’ position vis-à-vis the capitalists, which would result in better working conditions and a general reduction in working hours. Various accompanying measures are proposed so that the BGE cannot be used by the capitalists to lower wages and dismantle the welfare state. These include a health system that guarantees everyone free access, free education, free public transport, regulation of the housing market, nationwide high minimum wages and a tax system that shifts the tax burden to the rich. The Austrian Communist Party (KPÖ), for example, wants to finance the BGE through a “radical redistribution of existing social wealth” [7]. How these extensive measures should be implemented under the current balance of power remains unclear. However, it is clear that every little gap in the rules of these accompanying measures would result in the BGE/UBI being able to be used as a weapon of capital against the working class.

The BGE a win-win situation?

Many supporters, including the left, have presented the BGE as a win-win situation for capitalists and workers. It is claimed that the BGE both strengthens workers’ rights and supports companies. Workers are secured and no longer have to take on every job, companies can plan more flexibly and rationalize their production because they are released from their duties as employers. But this idea ignores the unsolvable contradiction between capital and labor. Both sides have conflicting interests. There cannot be a solution that benefits both sides. Either the rights of the workers are restricted and the capitalists increase their profits, or the workers fight for some of the added value at the expense of the capitalists.

The BGE is usually shaped by the idea that one can gradually grow into a “liberated society” through parliamentary influence on the state. The concept of the party DIE LINKE, for example, sees itself as “a proposal for a socio-ecological transformation towards a society that has overcome capitalist and patriarchal relations of rule” [8]. Attac views the BGE as a “building block in the transformation process with the aim of creating a” good life for all “” [9]. The idea that the basic contradictions of capitalism can be resolved through a state reform program disregards the class character of the state and contradicts the fact that the state primarily serves capital and not people. To expect an extensive attack on the capitalists from this very state is pure eyewashing. The demand for a BGE/UBI is not only an expression of state illusions, but also of knowingly wanting to disarm the working class by depriving the working class of an important means of asserting their interests.

At the same time, the idea is served that human and peaceful capitalism is fundamentally possible. But the contradictions of capitalism in its imperialist stage are necessarily linked to its existence. Given the destructive wars that imperialism is waging outwards and the repressive security that it is organizing inwards, ideas of human capitalism are illusory and contribute to the disorientation of the working class.

Decoupling work and wages

Both representatives of capital and left-wing supporters argue that there must be a decoupling of gainful employment and livelihood security. Due to the loss of jobs, it is no longer possible to meet people’s needs through gainful employment. Social security should therefore be guaranteed through a BGE/UBI from taxpayer money and no longer through wages. The Basic Income Network, which also includes Attac and Katja Kipping (Member of the Bundestag, DIE LINKE), argues that a BGE/UBI would be beneficial not only for “workers” but also for employers, as it would guarantee “more autonomy for entrepreneurs by relieving them of responsibility as employers”[10] . It is precisely this decoupling that enables capitalists to keep lowering wages and takes a central pressure off the working class [against them].

Capitalists will not, for good reason, improve the working conditions of the working masses. To push for real improvement, pressure must be put on capitalists by attacking their profits. For this, the masses of workers have to organize and strike at the factories where the profits are made. To enable the capitalists, through a BGE, to make the employment relationships more flexible is in contradiction to this goal.

The BGE is supposed to solve all problems as a universal savior and turns out to be the wish to reform capitalism until it loses its inhuman form. Even more: under the current balance of power, a BGE/UBI will be used as a tool by the capitalists against the working class and its allies and, for this reason, does not offer a short-term solution to the Corona crisis. Instead, we should fight for measures that are not so easily turned against the working class.

What we should ask for

The basic interest of the workers is to reduce the necessary working hours for everyone and to increase leisure time for everyone. This can only be fought in a collective struggle against capital and its state. An important basic requirement of the working class is therefore the reduction in working hours with full wage and staff compensation. However, wages are often barely enough to live on. While rents are rising in many places, almost a quarter of the workforce is employed in the low-wage sector [11]. This means that many have to work grossly below 2000 euros gross. Therefore, the demand for higher wages is on the agenda. Also the abolition of fixed-term contracts, temporary contracts and temporary work, but also decent basic security for the unemployed is in the interests of the working class and should be enforced in a common struggle. Because due to insecure employment and many unemployed people who are unsettled by their fears of existence, the working class can be blackmailed and their fighting conditions deteriorate.

Every struggle for improvement must train us to organize against the enemies of the working class and to sharpen our demands. We must have no illusions: capital and its state will not help us. We have to fight for improvements ourselves. In the long term, only socialism offers the opportunity to solve the problems of the working class and its allies.

[1] https://www.handelsblatt.com/politik/konjkonom/nachrichten/april-umfrage-ifo-fast-ein-fuenftel-der-deutschen-f Firmen-plant-stellenabbau-wegen-coronakrise/25765986.html?ticket = ST-540128-gcb5lAGTEp0H3valJV50-ap4

[2] https://www.arbeitsagentur.de/presse/2020-27-der-arbeitsmarkt-im-april-2020

[3] https://www.die-linke.de/themen/arbeit/tatsaechliche-arbeitslos/2020/

[4] https://epetitions.bundestag.de/petionen/_2020/_03/_14/Petition_108191.nc.html

[5] https://www.tag24.de/berlin/politik-wirtschaft/online-petition-bundestag-bedingungsloses-grund income-bge-susanne-wiest-1496934

[6] https://www.bz-nachrichten.de/insa-sonntagsfrage-was-waere-wenn-am-sonntag-der-bundestag-gewaehlt-worden-waere-und-wollen-die-deutschen-ein-bedingungsungslos – basic income /

[7] http://www.kpoe.at/sozialpolitik/grund income/2019/es-ist-genug-fuer-alle-da

[8] https://www.die-linke-grund income.de/fileadmin/lcmsbaggrund income/PDF/NeuflassungBGE_dinA5_06maerz.pdf

[9] https://www.attac.at/fileadmin/user_upload/aktivistinnen/grund income/allgemein/BGE_Positionspapier.pdf

[10] https://www.grundhaben.de/grund income/idee

[11] https://www.linksfraktion.de/themen/az/detailansicht/niedrigloehne/

Source: Kommunistsche Organisation (KO)

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