Tornado Alley (PROG)

[fuagf]

Why A Swiss Proposal To Give Every Citizen $US2,800 Each Month Is So Radical

"Oh, my. Aaron Carroll .. http://theincidentaleconomist.com/wordpress/i-dont-the-swiss-health-care-system-is-what-they-think-it-is/ .. is rightly very, very annoyed at Douglas Holtz-Eakin and Arik Roy . http://blogs.reuters.com/great-debate/2013/02/20/the-future-of-free-market-healthcare/ .. for saying that Obamacare should be replaced with a free-market system, like Switzerland’s. As he points out, the Swiss system is nothing like their description. In particular, they denounce community rating — but Switzerland has community rating!"

Adam Taylor 18 October 2013 10:53 AM

[ oops, money image copies too large]

Switzerland has a very direct style of democracy. For example, changes to the constitution, or “popular initiatives,” can be proposed by members of the public and are voted on if more than 100,000 people sign them. If a majority of voters and cantons (Swiss states) agree, the change can be come law.

This system not only allows individual citizens a high degree of control of their laws, but also means that more unorthodox ideas become referendum issues.

Recently, there has been a spate of popular initiatives designed to curb inequality in the country. Earlier this year Swiss voters agreed to an idea proposed by entrepreneur Thomas Minder that limited executive (in his words, “fat cat .. http://www.nytimes.com/2013/03/02/business/global/showdown-on-executive-compensation-in-switzerland.html?_r=0 ”) salaries of companies listed on the Swiss stock market. Next month voters will decide on the 1:12 Initiative, which aims to limit the salaries of CEOs to 12 times the salary of their company’s lowest paid employee .. http://www.aargauerzeitung.ch/aargau/kanton-aargau/112-initiative-der-abstimmungskampf-ist-eroeffnet-127273937 .

There’s a crazier [ ? crazy smart? ]proposal than this, however. Earlier this month an initiative aimed at giving every Swiss adult a .. http://www.admin.ch/ch/d/pore/vi/vis423t.html .. “basic income” that would “ensure a dignified existence and participation in the public life of the whole population” gained enough support to qualify for a referendum. The amount suggested is 2,500 francs ($2,800) a month .. http://www.reuters.com/article/2013/10/04/us-swiss-pay-idUSBRE9930O620131004 .

While most observers think that the vote is a longshot, it has certainly sparked debate — and not just in Switzerland. Writing for USA Today, Duncan Black said that a “minimum income” should be considered for the U.S.

“It’s pretty clear that the most efficient way to improve the lives of people is to guarantee a minimum income,” Black concludes.

However, Black understates just how radical the proposal is. We spoke to Daniel Straub, one of the people behind the initiative, to get a better understanding of what the proposal really means, why it is so radical, and what the world could learn from it.

Business Insider: Can you tell me a little bit about how the idea came to be?

Daniel Straub: A lot of people have proposed this idea. For example Thomas Paine in the United States .. http://www.pbs.org/moyers/journal/blog/2009/06/the_spirit_of_thomas_paine_tod.html .. or also the famous psychologist Erich Fromm .. http://www.fromm-gesellschaft.eu/index.php/en/home1/372-unconditional-basic-income .. has written about it in the sixties.

BI: Why choose a minimum income rather than, say, a higher minimum wage?

DS: We are not proposing a minimum income — we are proposing an unconditional income.

A minimum wage reduces freedom — because it is an additional rule. It tries to fix a system that has been outdated for a while. It is time to partly disconnect human labour and income. We are living in a time where machines do a lot of the manual labour — that is great — we should be celebrating.

[ hmm, it's a different consideration around the question of addressing inequality than i have seen before ]

BI: How was the figure of 2,500 Swiss francs settled on? What standard of living does this buy in Switzerland?

DS: That depends where in Switzerland you live. On average it is enough for a modest lifestyle.

BI: What effect would you expect the minimum income to have on Swiss government expenditure?

DS: The unconditional income in Switzerland means that a third of the GDP would be distributed unconditionally. But I don’t count that as government expenditure because it is immediately distributed to the people who live in this society. It means less government power because each individual can decide how to spend the money.

BI: I’ve seen people compare it to Milton Friedman’s negative income tax .. http://www.nytimes.com/2006/11/23/business/23scene.html , do you think that comparison works?

DS: We go a step further than Friedman with the unconditionality. This would lead to a paradigm change. Not the needy get an income from the community but everybody.

BI: There have been a variety of initiatives recently that appear to be aimed at limiting inequality in Switzerland, from the 1:12 initiative to Thomas Minder’s “against rip-off salaries” referendum. Why do you think this is happening?

DS: People seem to be unhappy with the rising inequality. The other initiatives try to put a band-aid on an outdated system. We are proposing a new system.

BI: On the surface of it, Switzerland is a good place to live, with a high quality of life, relatively high salaries, and good public services. Why do you need to take these big steps to rearrange society?

DS: Switzerland has incredible material resources. But we are not using them in a smart way. A lot of people are stressed and there is a lot of fear. Our resources don’t lead to the freedom they could. And I am not saying that this freedom is easy — but it could lead to more meaningful lives. If more people start to ask what they really want to do with their lives, Switzerland will become an even more beautiful place to live.

BI: Switzerland is a unique country in a lot of ways. Do you think that other countries — for example, the U.S. — could learn from both its referendum system and the egalitarian initiatives enabled by it?

DS: I think that our system of semi direct democracy leads to more involvement by the public — that is a good thing. What other effects it would have on a system such as the U.S. I do not dare to predict.

(The text has been edited for clarity, and links have been added to help explain Straub’s responses.)

http://www.businessinsider.com.au/behind-the-swiss-unconditional-income-iniative-2013-10

See also:

It's snowing in Switzerland.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=88527366