As we look at how people make a living, how they spend the money they earn? This infographic below by Samuel Granados and Gianluca Seta in the @courrierinter shows how people spend their money in Italy.
But when you lose your job or you can’t find a job, suddenly you have to make a decision on what to spend or not?
So should we campaign for an even greater increase in welfare spending or would more of the same still prevent people climbing out of the poverty black hole? We know that although financial equality doesn’t directly guarantee social equality, income inequality certainly aggravates other inequalities we face as The Spirit Level demonstrates. Indeed, the proportion of wealth has fallen for the majority of us as much as it has risen for the richest 10% since the earlier 90s.
Up until now, governments have focused much more on opportunity much more than equality – it even has a name for it – “social mobility” and the most visible example of this is their approach to “getting people back into work”.
The paradox though for the people that take this up is that they fall into a trap – they lose most of their benefits – housing & council tax as well as job seekers allowance while the rate of deduction of their tax rates rises significantly.
This obviously discourages people from trying to get back into work, as well as the practical difficulties of being able to afford to get to job interviews or even broadband to search for jobs. How will they be able to pay for the bills at the end of the month, not knowing how many hours their recruitment agency will give them to work and facing a sharp decrease in tax credits that takes place when you get a job?
In these times of change we can believe in, we would normally look to Obama, but the US is so far behind in terms of social protection, that it doesn’t make sense this time round to be inspired.
What we surely need then are more unconditional and non-withdrawable and less means-tested benefits to tackle poverty? How about a basic income? This pushes all these buttons, so should the EU reduce welfare spending to pay for a “basic citizen’s income” to everyone or should it increase taxes for those who earn more or even introduce a maximum wage to pay a “living citizen’s income”? What are the overriding benefits of a basic income?
The Citizen’s Income Trust argues that it’s unconditional, so it would also reduce the stigma attached to means-tested benefits. Its non-withrawable, so it would also reduce the stress attached to working out how much they would be left with at the end of the month.
It’s redistributive as income is redistributed from people who are better off more towards those less so. Those who earn the least would get a quarter more in come than they currently do, while those who earn the most would only get a bit less. The rest of us would either get an increase in income or would stay in the same position as we are now. It’s empowering as it would also encourage more flexible working, lifelong learning and retraining which is so important at the moment.
Isn’t it time for a basic income?