- So, an interesting
aspect about basic income and how the state has evolved over the last 50 years is that, in a certain sense, the decades of neoliberalism in the '80's and '90's were generally seen as a period where you have austerity, cuts in social spending. But the mystery is that when
you look at the numbers, public spending didn't
decrease in most countries. I'm Daniel Zamora. I'm a professor of Sociology
at the University of Brussels. And I work essentially
on economic history, inequality, poverty. Interestingly, over the
last 20 years, I think, basic income has really become kind of a important topic in
the development community. So, of course you have the United Nations that has been promoting basic income. But even more, let's say,
conservative institutions like the World Bank or the IMF have been kind of interested in the idea and promoting, over the
last 10 years at least, cash transfers as a tool
for poverty alleviation. And so one might say that this is kind of a
progress in a certain sense from the structural adjustment
policies of the '90's and the market-driven reforms that were imposed in many
countries in the Global South. But at the same time, we have to understand
that this focus on cash, which is what makes basic income appealing of course. It's also part of kind
of a broader displacement of development economics. And one aspect in particular, I think, has been quite important
over the last 10 or 20 years is like the divorce from
questions of poverty and the questions of industrialization. That was kind of a crucial question for most of the post-colonial leaders in the post-war period. So, for them it was pretty clear that poverty was not the problem, per se. The question was, poverty was a symptom
of a broader question, which was the question
of industrialization and the relations between the north and the south and the inequal relation
between the north and the south, especially trade relations. And so of course when
you think about poverty in that framework, the solution is not just cash transfer. It's about transforming the
global division of labor. It's about a state-led industrial policy. And that was truly at the core of their vision of development. So, what's interesting here is like, for them, poverty alleviation was about
transforming the economies in which the poor actually live, rather than allowing them
to be part of the market or to be part of the economy. So, it's not just about
altering income distribution, but to think or to contrast
the way we share labor at the global scale more generally. And so the shift here, which I think it's kind of
important to understand why basic income has become so popular is a shift from, let's say, the '50's and '60's, a developmental state that is really up to direct investment to control prices, to create jobs in certain industries, from what we call in the book a transfer state. So, a state that is less concerned about actually intervening in the economy, but just reshaping the
distribution of income. So in a certain sense, there is a shift from a state that is concerned from
rights of the citizens to a state that is more concerned about the spending power of consumers. So, there's kind of
important transition here that, as you see, it's not just different tools that we use to think about poverty, but it's really how we think about poverty itself that
has radically changed and where money takes a
bigger part of the story. The meaning of development in that story has radically changed. You immediately see how
the policies of the '90's. So, that was made by the
World Bank and the IMF. And countries like Mexico, a lot of countries in Latin America, certainly also in South Africa were basic income, or cash transfers because they didn't implement
basic income itself. But the rise of cash transfers wasn't an alternative to those policies, but it was a complement to it. Because those policies actually
created more inequality, created more poverty in
most of those countries. And then the question that
emerged immediately is, how can we mitigate those effects, reduce, in a certain sense, poverty but without putting in
jeopardy the market reforms? And keeping the whole market framework, keeping the whole privatization agenda, but at the same time
guaranteeing to everyone a certain minimal standard of living. So, what is kind of striking is that the rise of cash
transfers wasn't, let's say, a contestation of the
last decades of the '90's and all those reforms, market-driven reforms, but was a way to, a certain sense, go hand-in-hand with those reforms, and created, let's say, a market with a human face. But without really putting into question, what are the causes to poverty? You can ask anyone, "What is poverty?" Well, everyone will respond. "It's lacking of money." It's like an obvious answer. But for a long time, this wasn't the obvious response. I mean, this is kind of a
recent definition of poverty, one that is actually based
on the income distribution, so your place within
the income distribution. We call it an inter-individual definition of inequality or poverty. The problem with that definition is that, in a certain sense, it abstracts poverty. So, it becomes something
that is not embedded within social relations, especially relations of power. So most of the, let's say, thinkers of the early 20th century that thought about poverty, for many of them it was clear that poverty was a question
of power relations. So, it was the effect
of the unequal relations of power relations within, especially the labor market. So if you wanna tackle poverty, it's not about giving money. It's about giving them more power. It's about transforming those relations. So by allowing collective bargaining, by creating unions, by actually reducing
the grip of the market on people's lives, meaning that they
actually don't need money to get healthcare, to get education, to get a lot of things. So the rise of this, let's say, cash-centered definition of poverty, in a certain sense, shadows all those political questions about how we organize society, about how we share power, how we define our needs, how we define the jobs we wanna do. If you think about it, you can immediately see how
you can think about poverty of course by the side of money. But you can also think
about the other side, meaning reducing the dependence on market. So of course if you say
tomorrow there is rent control, it will have an effect on poverty. If tomorrow healthcare is free, it will have an effect on poverty because of course people don't need money to then get those services. And I think that, over the last 40 years, we've really shifted from one vision of it which was increasing the
rights that people have and increasing the services they receive and then increasing the market and the dependence we have on market. We shifted for another vision where we allowed privatization
of most public services. We allowed deregulation
of the labor market. But at the same time, we actually improved the access of cash to a certain amount of people. So, we improve, in a certain sense, the fiscal apparatus of the state while it retreated on other aspects, especially on public services. And this is one of the
questions that we should contest if we wanna think about poverty today and getting away from this kind of a very
narrow understanding of poverty centered on cash and centered on money. The idea is that, and the problem, especially one a famous economist of the 20th century
called Milton Friedman. So, one of the Chicago economists, one of the probably most
important neoliberal economists. He was actually concerned about in the '30's when he was actually working within the federal state in U.S. He was actually concerned about the rising inequality and poverty. Which might be surprising
for neoliberal economists, but it was definitely a problem for them. It's like, "Okay, if we have a free market, "it generates huge "inequalities. "And what is our response to that?" And this is the reason why he came up with a version of basic income, one of the earliest
versions of basic income. Which was if you want to provide to people a minimum set of resources while keeping the market, keeping the price mechanism that allows society to be organized through
decentralized investments, then what we need is to
create a system where people, if they fall under a certain threshold, they will receive money from the state. Would be a basic income. So, the idea is of course
that you can do welfare, you can provide people a
certain level of income but without altering the market mechanism. So, that was his first concern. Of course, it was a huge criticism of the Roosevelt policies and the New Deal. And it's kind of an alternative
to the welfare state. So, instead of having public healthcare, public education, public services, then you can just get some money and you go on the market and you do the choices you
want to do for yourself. So, it's a very different vision about how we think about needs. And I think this is kind
of an important question is how we think about needs and how the way we think
about needs has changed over the last 50 years at least. Because the market is not something that reveals needs that are already there. Or economists like to say that they reveal preferences. The markets are to constitute needs. And there is kind of a famous quote from Steve Jobs who said that, "Nobody knew he wanted an
iPhone before seeing an iPhone." So, of course he actually
does produce needs that weren't already there. So, we rely definitely more on the market to constitute the needs
we have as a society unless on collective decision making, which was what Friedman didn't like. The fact that rather than
letting private investor decide what we need, we can put some of those
resources in common and decide together what we need. And that, of course, the
outcome is very different because the decision is a democratic one rather than one made by consumers. And this is, I think, one of the big shifts that
happened during that period. And it also makes basic income a more appealing solution for welfare because it doesn't require for us to argue or to discuss democratically
about our needs, but just for consumers to go on the market and make their decisions
such they see fit. So, an interesting aspect
about basic income and how the state has evolved over the last 50 years is that, in a certain sense, the decades of neoliberalism by the '80's and '90's were generally seen as a period where you have austerity, cuts in social spending. But the mystery is that when
you look at the numbers, public spending didn't
decrease in most countries. Neither in United States, where it actually increased, neither in Europe. But what really changed, and this is kind of a significant change, is the way the states spend its money. So, while let's say in the '50's the state will, I don't know, pay for healthcare, pay for public servants and actually directly
employ a lot of people or build, for example,
social, public housing, the transition we had in that period, it was not in reducing spending, but was, "Rather than building housing, "we will give you some cash
to help you with your rent." Meaning, what we want is like
the market to do its work in housing. And if there is a problem, then we can help you with cash. So, basically the state
in a certain sense, public spending stayed the same, but the nature of the
state's radically changed. It became definitely more a state that, in a certain sense, let's say doesn't act on the market, but on the borders of the market, or around the market by transferring some cash
and by altering the rules, let's say the conditions of the game, rather than completely changing the game. Which was I think the aim of the New Deal and the policies in the post-war period. I think if we want to understand also the rising relevance of basic income and its increasing appeal. Because of course the idea has
been around for a long time. But it's only since the late '60's that it has become, let's say, a policy proposal that
is actually considered by politicians and policy makers. And so the reason why it really becomes something on the agenda while it was around way before, was, in part, I mean certainly because we began to think about
poverty in monetary terms. So for a long time, this definition is like quite marginal. And then by the '70's we really began to have our contemporary definitions of poverty, which is like your position
in the income distribution. But of course this definition
has certain limits. I mean, it doesn't give you, for example, a good sense of what does it
mean to be poor in a country if you are poor in a country where there is free healthcare and a country where there
isn't free healthcare. Having a certain amount of money is a completely different thing. So, your life would be
radically different. So it doesn't really
consider the institutions in which you are living, and especially the relation
between the state, the market, and the individuals in those societies. So this, let's say,
monetization of poverty completely put aside all
those political questions about our relation to the market. And also individualized poverty. Seen as something that is an accident. That is, you are in that place
in the income distribution, but we don't really know why. We don't really know the causes. And all the policies became more about attacking all
the effects of the market, meaning the market creates
all those inequalities, by altering the income distribution rather than actually
attacking the market itself and transforming the causes of poverty. So, we shifted, let's say, from a social policy that was about transforming the causes through social policy, only about mitigating the effects.
