Could there become a time when all our basic needs are paid for by the government? That’s the question many economists and politicians around the world are starting to explore.
By: RYAN MacRAE.
Canada has been well overdue for an expansion of its social security. According to the most recent (pre-pandemic) statistics from Statistics Canada, 3.2 million Canadians still live below the national poverty line.
The federal Liberals’ anti-poverty strategy will aim to cut this number in half by 2030, but this is simply too low of a bar.
The Latin American Mission Program has consistently called for the complete elimination of poverty, both globally and domestically, and sees that a Basic Income Guarantee (BIG) policy would be a significant step in achieving this goal.
Although income instability has long been an issue for the Canadian public, the coronavirus pandemic has been a catalyst for amplifying the problem. Between February and April of this year, 2.5 million Canadians were laid off by their employer, while another three million suffered a drop in employment hours. Thankfully, Ottawa responded with the Canadian Emergency Response Benefit (CERB).
The CERB succeeded in recognizing the financial need for Canadians who lost their employment opportunities through no fault of their own. It was able to rapidly adapt to provide Canadians with income security through existing government networks. That being said, the policy has had its shortcomings. CERB was not universally accessible and deemed key segments of Canada’s population “ineligible” since they had not met the $5,000 threshold of earned income in 2019. The policy also disincentivized employment by limiting recipients to $1,000 of employment earnings each month.
Most concerning of all, however, is the notion that this crucial social security is temporary. Income insecurity will outlast the pandemic.
A proper, robust security net should provide a guaranteed income floor above the poverty line for all Canadians above the age of 18; one that is not contingent on previous earnings and truly indiscriminate of any and all socioeconomic factors.
Benefits received under BIG would gradually diminish as other income increases, ensuring that those who require the assistance are the ones who receive it.
Such a policy dignifies all Canadians by offering them choices and opportunities that income inadequacy would otherwise prevent.
Perhaps they are immediate, such as healthier eating options or the ability to change transportation methods. It can also support long-term planning, something poverty tends to inhibit. A sustained, secure income means you aren’t forced to remain in a dead-end job, and it may support and incentivize education to change career paths. In doing so, BIG reduces unnecessary human suffering by providing adequate support for every adult to live a dignified life.
Employment insurance requires “paid employment” as a prerequisite to accessing benefits, but BIG values other forms of work outside of this, many of which have historically been unpaid labour done by women across the globe. These “paid employment” opportunities are on a downward trajectory, too.
Unemployment rates have exploded throughout the pandemic, but the pipe dream of sustained secure employment in the future doesn’t seem viable with the loom of technological advancements replacing human labour at a fraction of the cost.
Last year, a study from Oxford Economics stated that automation is set to replace 20 million jobs in the manufacturing sector by 2030. This doesn’t account for jobs that are increasingly being lost in the service industry and the existence of self-driving machinery that threatens the livelihoods of those who depend upon jobs in the transportation sector.
Not only is BIG necessary, it is also sustainable and achievable. Direct cash transfers have incredibly high macroeconomic benefits — the income received won’t be stored in a bank account, but rather immediately spent on essential consumption, stimulating the economy. Similar federal benefits, such as the Guaranteed Income Supplement for seniors, has proven this to be true. Economic evidence also suggests governments will save on health care and crime prevention. A sustained, healthy diet leads to fewer trips to the hospital while financially stable citizens won’t need to break the law to provide for themselves.
CERB has shown the Canadian public that a basic, guaranteed income is possible.
While many of us long for a return to a socially interactive normal, we must reject a return to the old socioeconomic normal and commit to replacing it with one rooted in equity. Poverty is created through our economic system and we can begin to end it through proper government policy.
Ryan MacRae, Charlottetown, P.E.I., on behalf of the Latin American Mission Program of the Roman Catholic Diocese of Charlottetown.