Could people afford themselves to work only if they want to? In practice, every adult and child – regardless of personal financial standing – would receive a sum of money from the state that is enough to have their basic needs met without providing a life in luxury. Thus, work, which is an integral part of our lives – would become something to enjoy, not an essential source of income.
The citizens of Switzerland will vote on whether to introduce a basic income in the near future. Enno Schmidt German director, painter, graphic designer, and prosperous entrepreneur says that he could easily gather 100,000 signatures to call a referendum because the Swiss understand that the point of working is not making money. Profit is just a tool for increasing social welfare. The leading advocate of the unconditional basic income is Götz Werner economist, university professor, one of Germany’s richest man, and the founder-owner of dm-drogerie mark, who also promotes the idea in Germany. In the interview, Schmidt answers why this project could cause a culture shock in Hungary.
Zentai Péter: Your are a German citizen. Why do you want to persuade the Swiss to propose a basic is income for everybody – adult and child – instead of the Germans? Why did you target the Swiss people?
Enno Schmidt: I have been living and working in Switzerland for almost eight years. Do you know why I moved here? Mainly, because this is the only direct democracy in the world. In essence, the power is in the hands of the people and the state is acting at the direction and under the control of them. In other words, people charge the state to serve them for their money. The main characteristic of the Swiss democracy is that the most important governmental and parliamentary decisions are made after a referendum is held. Should I have waited until my home country, Germany, introduces direct democracy sometime in the future?
The introduction of the basic income guarantee would cause a dramatic change, a big culture shock – or cultural impulse – in the society. The government or the parliament cannot decide on it – the people have to. Germany is far from letting the nation decide on that, even if there was a political intention to do so.
Nevertheless, it is remarkable that even a foreign citizen has right to mobilize the local public opinion in Switzerland. More than hundred thousand Swiss people followed your initiative and it is likely that a historic referendum will be held on providing people a monthly basic income of €2,000, no strings attached.
Preliminary calculations show that this monthly basic income guarantee would be more than €2,000, as it would total up to 3,200 francs. The children would get less money than that. Nonetheless, every citizen who lives or works here – because a foreigner is only allowed to live in the country legally if it is proved that he or she works in Switzerland – would receive a fair amount of money that would ensure them a modest living and satisfy their basic needs.
This is called realized socialism, what is more, communism. The Swiss version of communism…
Not at all! This concept is not based on an ideology or Switzerland. It aims to highlight capitalism and wealth creation. If the unconditional basic income was introduced in Switzerland and in other countries following the Swiss model, it would not affect the competition-based market economy a bit. Therefore, the capitalist system would work fairer and more efficiently because it would be finally unveiled that people work for profit, not money.
The idea of basic income has gained support in Switzerland first because the corporate culture is increasingly growing, making the nation and the economy extremely effective. In such a corporate structure profit itself is not a goal but a tool for the participants of businesses, for the employees, and for the employers to achieve financial freedom. In this way, they could also set their creativity free and enjoy doing something beneficial and useful for the society.
In fact, the development of capitalism made it possible to discuss about all of this. Under the circumstances of capitalism, productivity has increased rapidly and, due to technological development, the production of goods and services requires less manufacturing by humans. Automation shoots ahead unstoppably, causing unemployment in the developed countries. As you can experience in your profession, in journalism (but we could also mention industry, trade, or especially, agriculture), fewer and fewer people are needed to perform classical works.
You said that people did not work for money and the capitalist did not work for profit? So you suggest that your ”comrade” Götz Werner, who is one of richest men in Germany, the founder and the co-owner of dm-drogerie markt, is not interested in profit? Dm is an absolutely profit-oriented private company…
Götz Werner has laid down the principles of the basic income guarantee as a scientist, as a university professor. Actually, he takes out just as much money from his business that enables him and his family to be comfortably off without living in luxury. He donates a part of the profit – that is not reinvested in the company to charity. By supporting programs improving education and fighting diseases and poverty, he returns an extremely large amount of money to the society. More and more people think like him because they realize that a corporation is powered by the members of the society and their consumption. An entrepreneur, who takes high risk and responsibility for his employees, has right to earn more money than those, who take lower risk. However, he has no right to exploit them. This would be wasting money, which simply cannot be the interest of a capitalist. The real goal of an enterprise is to provide a better living for the consumers – the members of the society. A large share of the profits is taken away from the entrepreneurs, which is unfair. This injustice would be eliminated by the basic income guarantee.
Can you imagine that the majority of the people would not give up their job immediately – for instance, in Hungary – , if they received an unconditional income from the state?
Well, let’s go into details. Of course, Hungary is not Switzerland. In Hungary, the GDP per capital is much smaller and the differences between the prices – especially, of the utilities and renting prices – are a far cry from those of Switzerland. In the current economic situation, each Hungarian adult would receive €600 and each child €200. That would be €1,600 in total for a family with two children.
A Hungarian family would be perfectly happy with that. Neither the father, nor the mother would work then…
Really? So you suggest that you would give up doing interviews and working as a journalist, if you received €600 a month?
I personally would continue working because I enjoy my job. It is essential in my life…
So you assume that the other Hungarians are lazy and have no ambitions? 90 percent of the people we asked in Switzerland or in Germany said that they would have never given up working, even if they had gotten €2,000-€2,500 a month. Also the majority of assembly-line workers said that they would have kept on working, look for another job, or study, even if they had received enough money to provide for their family. This is true because most of the people – all around the world – are not working for money but because they want to work, to produce something, and to be useful. Our studies show that an average, hard-working person would not care, if others were sitting around and doing nothing while getting an income guarantee. Most of the people, who could not get a paying job, would take up a job in social care to support the helpless since they could afford it, if they lived in financial security.
Who would clean the streets in Switzerland or anywhere else, where the basic income was introduced? Who would wash the dishes and clean the toilets? Guest workers from abroad? If they did not get a basic income – unlike the Swiss -, we would return to ancient Greek democracies or Arab oil sheikhs’ world: while the free citizens prosper, the imported slaves do the dirty work…
Although a lot questions remain, this particular issue seems to be solved. Every single person, who works legally in Switzerland, would receive the basic income because they are creating wealth here and maintain the standard of living of the local community – even if they clean the streets. However, those Swiss citizens, who work abroad, would not be entitled to the basic income.
Back to toilet cleaning and street cleaning: in such circumstances, the demand for the dirty jobs would significantly decrease. Therefore, it must be better paid than today.
As I mentioned, the market forces would strengthen in the “new world”. Competition will increase and get more transparent. The basic income guarantee has nothing to do with class conflict. It does not influence the stock market speculation or the role of the financial sector; it is only making it more sophisticated and more advanced. The rich remain rich. However, the poor would not go hungry or become homeless just because they cannot pay the rents. The access to basic income would become a part of the inalienable rights of the human beings because it saves lives and sustains people.
I can already see that “basic income tourism” will start in Europe. Most people will migrate to countries, where they receive an income unconditionally or where they get the largest sum of money.
If people feel financially secure, they rather stay in their home country than move abroad. If the guaranteed basic income was introduced in Hungary (or in any other country – with different amount of money, of course), people would not be eligible for social security, unemployment benefits, pension, or scholarship and employers would be free from any contributions.
Wages should be negotiated again; now, between financially confident employer and an employee with guaranteed income. None of the parties could bluff as they know each other’s positions and are not vulnerable. Their relationship will be determined by whether both of them seek success and the satisfaction of their customers. Even if they fail to do so, their existence is not in threat. They will cooperate in order to achieve their common goals and will decide on how much the employee will earn beside his or her basic income. Three hundred? Six hundred? They will decide on that. Nevertheless, people with relatively low income today will be better off, while richer people will earn less.
What about the prices? Would the implementation of this initiative change market prices dramatically?
If most of the taxes on the wages were eliminated, everything would become necessarily cheaper. However, the taxes on goods and services would increase significantly since these taxes finance the basic income. Basically, the citizen’s income is tax returned that the society pays for itself. The state is used as an intermediary. In fact, it is just a fiction because the state is a community of citizen, bureaucrats, politicians, and representatives, paid by other member of the community.
Don’t you think that these politicians and representatives will strongly oppose the initiative because they fear that they would lose importance? The idea of basic income leads directly to the end of political corruption and the decrease in crime rates. Fewer policemen, lawyers, and prisons will be needed. They are very influential people, who will do everything to avoid this.
You must be right. That is why we should start it in Switzerland because the state has very little power to resist and corruption is low. Of course, the Scandinavian countries are also ready for trying this experiment first. I think it is likely that Finland will introduce a basic income in the near future.
If the experiment succeeds, sooner or later, citizens of other countries will demand a guaranteed basic income, as well.