Banks, Inequality and Citizens

Banks, Inequality and Citizens

By Roberto Savio

ROME, Jan (IPS)  Every day we receive striking data on major issues which should create tumult and action, but life goes on as if those data had nothing to do with people’s lives.

A good example concerns climate change. We know well that we are running out of time. It is nothing less than our planet that is at stake … but a few large energy companies are able to get away with their practices surrounded by the deafening silence of humankind.

Another example comes from the world of finance. Since the beginning of the financial crisis in 2009, banks have paid the staggering amount of 178 billion dollars in fines – U.S. banks have paid 115 billion, while European banks 63 billion. But, as analyst Sital Patel of Market Watch writes, these fines are now seen as a cost of doing business. In fact, no banker has yet been incriminated in a personal capacity.

Now we have other astonishing data from Oxfam – if nothing is done, in two years’ time the richest one percent of the world´s population will have a greater share of its wealth than the remaining 99 percent.

The richest are becoming richer at an unprecedented rate, and the poorest poorer. In just one year, the one percent went from possessing 44 percent of the world´s wealth to 48 percent last year. In 2016, therefore, it is estimated that this one percent will possess more than all the other 99 percent combined.

The top 89 billionaires have seen their wealth increase by 600 billion dollars in the last four years – a rise of five percent and equal to the combined budgets of 11 countries of the world with a population of 2.3 billion people.

In 2010, that figure was owned by 388 billionaires, and this striking and rapid concentration of wealth has, of course, a global impact. The so-called middle class is shrinking fast and in a number of countries youth unemployment stands at 40 percent, meaning that the destiny of today’s young people is clearly much worse than that of their parents.

It will probably take some time before those figures become part of general awareness but it is a safe bet that they will not lead to any action, as with climate change. U.S. President Barack Obama is the only leader who has announced a tax increase on the rich, although he stands little chance of succeeding with his Republican-dominated Congress.

In a world where the value of solidarity has disappeared (Europe’s de+bate on austerity is a good example), apathy and atomisation have become the reality. We are going back to the times of Queen Victoria, substituting a rich aristocracy with money coming from trade and finance, not production. But up to a point: 34 percent of today’s billionaires inherited all or part of their wealth, and – interestingly – “inheritance tax is the most avoidable of levies”, as James Moore noted Jan. 20 in The Independent.

The “father of modern times”, late U.S. President Ronald Reagan, saw it clearly when he said that the rich produce richness, the poor produce poverty. So let the rich pay less taxes.

Well, in a just-released report, the U.S. Institute on Taxation and Economic Policy notes that in 2015 the poorest one-fifth of Americans will pay on average 10.9 percent of their income in taxes, the middle one-fifth 9.4 percent, and the top one percent just 5.4 percent.

Now, 20 percent of the richest billionaires are linked to the financial sector and it is worth recalling that this sector has grown more than the real economy, and has regulations only at national level. At global level, finance is the only activity which has international body of some kind of governance, as do labour, trade and communications, to name just a few.

Finance is no longer at the service of the economy and citizens. It has its own life. Financial transactions are now worth 40 trillion dollars a day, compared with the world’s economic output of one trillion.

At national level, there are now attempts half-hearted attempts to regulate finance. But let us look what is happening in United States. The new bland regulation is the Wall Street Reform and Consumer Protection Act, commonly known as the Dodd-Frank, and it does not go as far as restoring the division between deposit banks, which was where citizens put their money and which could not be used for speculation, and investments banks, which speculate … and how!

This separation was abolished during the U.S. presidency of Bill Clinton, and is considered the end of banks at the service of the real economy. In any case, the lobbyists on Wall Street are intent on having the Dodd-Frank chipped away at, little by little.

There is some schizophrenia when we look at the relations between capital and politics. The U.S. Supreme Court has eliminated any limit to contributions from companies to political elections, declaring that the companies have the same rights as individuals. Of course, there are not many individuals who can shell out the same figures as a company, unless you’re one of the 89 billionaires!

Meanwhile, banks are not only responsible for the corruption of the political system, and for the illegal activities which have earned them billions of dollars, they are also responsible for funding only big investors, and leaving everybody else out from easy credit. The efforts of the Chairman of the European Central Bank,  Mario Draghi, to have banks give credit to small companies and individuals has gone largely nowhere.

But a new and imaginative initiative comes from the very stern Dutch bankers. All 90,000 bankers in the Netherlands are now required to take an oath: “I swear that I will endeavour to maintain and promote confidence in the financial sector. So help me God”.

This is not so much oriented towards the customer, and it is very self-serving; and it brings God in as the regulator of the Dutch banking system. Perhaps the Dutch bankers have been paying heed to the words of Goldman Sach’s CEO Lloyd Blankfein who said at the time of the financial crisis in 2009 that bankers were “doing God’s work”.

Well God will have to be actively involved. All the three biggest Dutch banks – Rabobank, ABN Amro and ING Groep – have been involved in scandals that have hurt consumers, or were nationalised during the financial crisis, costing taxpayers more than 140 billion dollars. In one case, Rabobank was fined one billion dollars.

New York’s Wall Street and London’s City are said to be open to the idea of introducing a similar oath.

It is probably only that kind of Higher Power which could turn the tide in this world of growing inequality and lack of ethics.

 

*Founder and president emeritus of the Inter Press Service (IPS) news agency. In recent years he has also founded Other News (www.other-news.info/), a service providing ‘information that markets eliminate’.

 

 

EU Showdown: Greece Takes on the Vampire Squid

EU Showdown: Greece Takes on the Vampire Squid

posted by Ellen Brown | 5gb
January 20, 2015 

 http://www.publicbankinginstitute.org/eu_showdown_greece_takes_on_the_vampire_squid

 

Greece and the troika (the International Monetary Fund, the EU, and the European Central Bank) are in a dangerous game of chicken. The Greeks have been threatened with a “Cyprus-Style prolonged bank holiday” if they “vote wrong.” But they have been bullied for too long and are saying “no more.”
A return to the polls was triggered in December, when the Parliament rejected Prime Minister Antonis Samaras’ pro-austerity candidate for president. In a general election, now set for January 25^th, the EU-skeptic, anti-austerity, leftist Syriza party is likely to prevail. Syriza captured a 3% lead in the polls following mass public discontent over the harsh austerity measures Athens was forced to accept in return for a €240 billion bailout.
Austerity has plunged the economy into conditions worse than in the Great Depression. As Professor Bill Black observes, the question is not why the Greek people are rising up to reject the barbarous measures but what took them so long.
Ireland was similarly forced into an EU bailout with painful austerity measures attached. A series of letters has recently come to light showing that the Irish government was effectively blackmailed into it, with the threat that the ECB would otherwise cut off liquidity funding to Ireland’s banks. The same sort of threat has been leveled at the Greeks, but this time they are not taking the bait.

Squeezed by the Squid

The veiled threat to the Greek Parliament was in a December memo from investment bank Goldman Sachs – the same bank that was earlier blamed for inducing the Greek crisis. Rolling Stone journalist Matt Taibbi wrote colorfully of it:

The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who’s Who of Goldman Sachs graduates.

Goldman has spawned an unusual number of EU and US officials with dictatorial power to promote and protect big-bank interests. They include US Treasury Secretary Robert Rubin, who brokered the repeal of the Glass-Steagall Act in 1999 and passage of the Commodity Futures Modernization Act in 2000; Treasury Secretary Henry Paulson, who presided over the 2008 Wall Street bailout; Mario Draghi, current head of the European Central Bank; Mario Monti, who led a government of technocrats as Italian prime minister; and Bank of England Governor Mark Carney, chair of the Financial Stability Board that sets financial regulations for the G20 countries.
Goldman’s role in the Greek crisis goes back to 2001. The vampire squid, smelling money in Greece’s debt problems, jabbed its blood funnel into Greek fiscal management, sucking out high fees to hide the extent of Greece’s debt in complicated derivatives. The squid then hedged its bets by shorting Greek debt. Bearish bets on Greek debt launched by heavyweight hedge funds in late 2009 put selling pressure on the euro, forcing Greece into the bailout and austerity measures that have since destroyed its economy.
Before the December 2014 parliamentary vote that brought down the Greek government, Goldman repeated the power play that has long held the eurozone in thrall to an unelected banking elite. In a note titled “From GRecovery to GRelapse,” reprinted on Zerohedge, it warned that “the room for Greece to meaningfully backtrack from the reforms that have already been implemented is very limited.”
Why? Because bank “liquidity” could be cut in the event of “a severe clash between Greece and international lenders.” The central bank could cut liquidity or not, at its whim; and without it, the banks would be insolvent.
As the late Murray Rothbard pointed out, all banks are technically insolvent. They all lend money they don’t have. They rely on being able to borrow from other banks, the money market, or the central bank as needed to balance their books. The central bank, which has the power to print money, is the ultimate backstop in this sleight of hand and is therefore in the driver’s seat. If that source of liquidity dries up, the banks go down.
The Goldman memo warned:

The Biggest Risk is an Interruption of the Funding of Greek Banks by The ECB.
Pressing as the government refinancing schedule may look on the surface, it is unlikely to become a real issue as long as the ECB stands behind the Greek banking system. . . .
But herein lies the main risk for Greece. The economy needs the only lender of last resort to the banking system to maintain ample provision of liquidity. And this is not just because banks may require resources to help reduce future refinancing risks for the sovereign. But also because banks are already reliant on government issued or government guaranteed securities to maintain the current levels of liquidity constant. . . .
In the event of a severe Greek government clash with international lenders, interruption of liquidity provision to Greek banks by the ECB could potentially even lead to a Cyprus-style prolonged “bank holiday”. And market fears for potential Euro-exit risks could rise at that point. [Emphasis added.]

The condition of the Greek banks was not the issue. The gun being held to the banks’ heads was the threat that the central bank’s critical credit line could be cut unless financial “reforms” were complied with. Indeed, any country that resists going along with the program could find that its banks have been cut off from that critical liquidity.
That is actually what happened in Cyprus in 2013. The banks declared insolvent had passed the latest round of ECB stress tests and were no less salvageable than many other banks – until the troika demanded an additional €600 billion to maintain the central bank’s credit line.
That was the threat leveled at the Irish government before it agreed to a bailout with strings attached, and it was the threat aimed in December at Greece. Greek Finance Minister Gikas Hardouvelis stated in an interview:

The key to . . . our economy’s future in 2015 and later is held by the European Central Bank. . . . This key can easily and abruptly be used to block funding to banks and therefore strangle the Greek economy in no time at all.

Europe’s Lehman Moment?

That was the threat, but as noted on Zerohedge, the ECB’s hands may be tied in this case:

[S]hould Greece decide to default it would mean those several hundred billion Greek bonds currently held in official accounts would go from par to worthless overnight, leading to massive unaccounted for impairments on Europe’s pristine balance sheets, which also confirms that Greece once again has all the negotiating leverage.

Despite that risk, on January 3^rdDer Spiegel reported that the German government believes the Eurozone would now be able to cope with a Greek exit from the euro. The risk of “contagion” is now limited because major banks are protected by the new European Banking Union.
The banks are protected but the depositors may not be. Under the new “bail-in” rules imposed by the Financial Stability Board, confirmed in the European Banking Union agreed to last spring, any EU government bailout must be preceded by the bail-in (confiscation) of  creditor funds, including depositor funds. As in Cyprus, it could be the depositors, not the banks, picking up the tab.
What about deposit insurance? That was supposed to be the third pillar of the Banking Union, but a eurozone-wide insurance scheme was never agreed to. That means depositors will be left to the resources of their bankrupt local government, which are liable to be sparse.
What the bail-in protocol does guarantee are the derivatives bets of Goldman and other international megabanks. In a May 2013 article in Forbes titled “The Cyprus Bank ‘Bail-In’ Is Another Crony Bankster Scam,” Nathan Lewis laid the scheme bare:

At first glance, the “bail-in” resembles the normal capitalist process of liabilities restructuring that should occur when a bank becomes insolvent. . . .
The difference with the “bail-in” is that the order of creditor seniority is changed. In the end, it amounts to the cronies (other banks and government) and non-cronies. The cronies get 100% or more; the non-cronies, including non-interest-bearing depositors who should be super-senior, get a kick in the guts instead. . . .
In principle, depositors are the most senior creditors in a bank. However, that was changed in the 2005 bankruptcy law, which made derivatives liabilities most senior. In other words, derivatives liabilities get paid before all other creditors — certainly before non-crony creditors like depositors. Considering the extreme levels of derivatives liabilities that many large banks have, and the opportunity to stuff any bank with derivatives liabilities in the last moment, other creditors could easily find there is nothing left for them at all.

Even in the worst of the Great Depression bank bankruptcies, said Lewis, creditors eventually recovered nearly all of their money. He concluded:

When super-senior depositors have huge losses of 50% or more, after a “bail-in” restructuring, you know that a crime was committed.

Goodbye Euro?
Greece can regain its sovereignty by defaulting on its debt, abandoning the ECB and the euro, and issuing its own national currency (the drachma) through its own central bank. But that would destabilize the eurozone and might end in its breakup.
Will the troika take that risk? 2015 is shaping up to be an interesting year.
___________
Ellen Brown is an attorney, founder of the Public Banking Institute, and author of twelve books including the best-selling Web of Debt. Her latest book, The Public Bank Solution, explores successful public banking models historically and globally. Her 200+ blog articles are at EllenBrown.com.

US Basic Income Guarantee Vol. 16, No. 79, January 2015

USBIG NewsFlash Vol. 16, No. 79, January 2015

The USBIG NewsFlash is both the newsletter of the U.S. Basic Income Guarantee (USBIG) Network and the U.S. edition of the Basic Income Earth Network’s NewsFlash. The USBIG Network (www.usbig.net) promotes the discussion of the Basic Income Guarantee (BIG) in the United States. BIG is a policy that would unconditionally guarantee at least a subsistence-level income for everyone. If you would like to be added to or removed from this list please go to: http://www.usbig.net/newsletters.php.
For questions, contact the editor, Karl Widerquist: Karl@Widerquist.com.

Contents

1. Editorial: Invitation to the political movement for BI
2. News
3. Events
4. BI Literature
5. Audio-Video
6. New Links
7. About the Basic Income Earth Network and its NewsFlash

1. Editorial: Invitation to the political movement for BI

I would like to take this opportunity to invite everyone to come to the Commons Brooklyn on March 1 to discuss a political movement for Basic Income. More information about it is below and online. There’s so much happening about basic income around the world, so much more interest in this topic than ever before, maybe it’s time to start a political push for Basic Income in the United States? We’ll talk about that issue at 6:30pm, Sunday March 1, 2014 in the Commons Brooklyn, 388 Atlantic Avenue Brooklyn, NY 11217.
-Karl Widerquist, Doha, Qatar, January 17, 2015

2. News

ONLINE: Efforts to get Basic Income in front of lawmakers

[Liam Upton]

In recent months, there have been two online efforts to get the idea of Basic Income in front of lawmakers, both in the USA and the UK.

The first one is an e-petition, launched in October by UK Independent politician Pete Higgens, which was reported on previously by BINews. After a slow start, the petition was mentioned by the popular British blog Another Angry Voice and as a result became the most trending petition at least twice. The total amount of signatures currently stands at over 3,000 with 100,000 needed for it to be discussed by lawmakers in the House of Commons. The petition lasts a year and will end in October 2015.

Another effort in the USA is a result of the Big Ideas project, a project launched in December 2014 by the Progressive Change Institute and has the aim of getting crowdsourced ideas in front of US lawmakers. 30 members of Congress have already comitted to taking a 'serious look' at the top 20 most voted ideas on the site. Currently there is an idea which quotes Martin Luther King and proposes a Jobs Guarantee or 'if impractical', a 'Guaranteed Annual Income'. This idea has trended repeatedly since the launch of the site and is currently the fifth highest voted idea with over 4,000 votes. There is also another idea which mentions just a Universal Basic Income Guarantee which has over 1,500 votes and was previously in the top 20 but despite trending a number of times, has since fallen below that number.

For more information see:

Pete Higgens, “Replace the Benefits System with a Universal Basic Income for all”, HM Government, 30 October 2014

Progressive Change Institute, “Big Ideas Project”, Progressive Change Institute, December 2014

UNITED KINGDOM: Basic Income group forms within Liberal Democrats party

After a pair of blog posts from Liberal Democrats councillor, Nick Barlow, a group supporting Basic Income has formed inside the Liberal Democrats. The Liberal Democrats are currently in a coalition government with the larger Conservative party.

The original blog post, entitled 'Liberal Democrats for Basic Income, anyone?', noted how the policy was once part of the Liberal Democrats' manifesto and that the author had noriced increasing talk about the idea. Barlow then declares his own support for the idea and asks for support and suggestions on making the idea Liberal Democrat policy once again.

The post went on to become Barlow's most popular post of the year, despite being posted in December and recieved a number of comments of support from readers. As a result, he was spurred on to then write a second blog post in an attempt to organise supporters and push the idea forward. In this post he announced what he thinks supporters should focus on as well as the creation of a mailing list and Facebook page for this new group called 'Liberal Democrats for Basic Income'. The intent is to allow for discussion of the idea among those interested within the party.

These posts where then followed by a post in the LibDemVoice blog by parliamentary candidate Robin McGhee, which advocated the party adopt Universal Basic Income as a policy. The LibDemVoice is an influential blog run by volunteer Liberal Democrat members to discuss issues concerning the Liberal Democrats. It has a readership of 50,000 a month and according to their About page is 'ranked among the top 5 most influential blogs in the UK'. The post generated considerable debate, with many commenters expressing support for the idea.

Basic Income News conducted an interview with Nick Barlow on the topic, which you can read here.

For more information, see:

Nick Barlow, “Liberal Democrats for Basic Income, anyone?”, What You Can Get Away With, 02 December 2014

Nick Barlow, “Liberal Democrats for Basic Income: the next steps”, What You Can Get Away With, 03 December 2014

Robin McGhee, “Opinion: Universal Basic Income is the way forward for the Liberal Democrats”, Liberal Democrat Voice, 19 December 2014

UNITED STATES: Democratic Proposal Small Step in the Direction of BIG

U.S. Representative Chris Van Hollen (a Democrat from Maryland) has proposed introduce a small financial transactions tax (essentially a tax on Wall Street speculators) to finance a $1000 per year tax credit, which will be added to the paychecks of all workers earning under $100,000, or working couples earning under $200,000. This proposal would come in addition to the existing “Earned Income Tax Credit,” and it would be closer to universal, probably reaching a substantial majority of the population.

A proposal reaching so many people can be seen as a step in the direction of a basic income. However, the proposal has several differences with a basic income, most notably, it is conditional on labor. This cuts out some of the most needy people in society including the disable, children, people with fulltime care responsibilities, and people who can’t find an acceptable job. Being conditional on labor, some of the benefit of the tax credit is likely to be captured by employers who might have an incentive to reduce wages or foregone raises because the government is now paying the first $1000 of most of their employees wages. The overall effect is likely to be higher living standards for the average work, but by less than the full $1000 economists would expect from a lump sum payment such as a basic income.

The plan is not likely to gain much support in the Republican-controlled Congress. But if it gathers support among

For more information on the proposal see:

Richard Kirsch, “Van Hollen Tax Proposal an Economic and Political Home Run.” The Huffington Post. 01/12/2015

Budget Committee Democrats, “An Action Plan to Grow the Paychecks of All, Not Just the Wealthy Few.” Budget Committee Democrats (website). Accessed January 14, 2015.

FRANCE, BELGIUM, SWITZERLAND: Launch of French-language Basic Income newspaper 'L'inconditionnel'

[Liam Upton]

The new Basic Income newspaper, 'L'inconditionnel' has been officially launched with two launch parties in Brussels and Paris, on the 9^th and 12^th of December, respectively.

The newspaper, which is free of charge, was funded via French crowd-funding site pickandboost.com where it made its goal of €12,000, enough for the first run of 60,000 copies. It aims to 'explore the different facets of the idea of an Unconditional Basic Income' through in-depth articles and interviews as well as art and literary writings.

The newspaper is currently available across France and Belgium and one location in Portugal. The paper will also be available online and in Switzerland.

For more information, see:

Language: French

Stanislas Jourdan, “Soirée de lancement de L'inconditionnel à Paris [Launch party for L'inconditionnel in Paris]”, L'inconditionnel, 5 December 2014

Language: French

Stanislas Jourdan, “Soirée de lancement de L'inconditionnel à Bruxelles [Launch party for L'inconditionnel in Brussels]”, L'inconditionnel, 2 December 2014

JAPAN: Party that endorses BIG has a new political platform

[Toru Yamamori]

Greens Japan (Japanese Green party) endorsed BIG from its beginning in 2012. On 31^st October 2014, A new political organization ‘E-Future Association [e-mirai-no-kai]’ was launched in Kyoto. This organisation is a loose umbrella entity for coming local election in Kyoto 2015 by the Green Japan, the Kyoto Seikatsusha Network, and citizens who do not belong to any political organization. ‘E’, part of their name, means two things: first the sound means ‘good’ in Japanese, and second it connotes their intention to facilitate ‘online-activism.’ They call this umbrella entity ‘platform’ and explains this ‘platform’ strategy was learnt from experiences of early stage of Green Party in Germany.

On 8^th November, ‘E-Future Association’ had a launching event, where Yoshiko Kada, former governor of Shiga prefecture gave a talk, and two candidates for local elections were announced.

Uiko Hasegawa, the co-president of Green Party Japan, is also the co-president of this association Her interview on Basic Income by the BI News team will be translated to this site shortly. 

The setting up of the platform is covered by Japanese News Paper:

http://www.kyoto-np.co.jp/politics/article/20141031000169

The launching event is covered by Japanese News Paper:

http://www.kyoto-np.co.jp/top/article/20141108000142

The English site of Greens Japan:

http://greens.gr.jp/world/english/

UNITED STATES: Vox’s Dylan Matthews Extensively Writes on the Basic Income

[Josh Martin]

Dylan Matthews, contributor to Vox and formerly to The Washington Post, has written a series of well-researched posts on the universal basic income.  Since December 2012, Matthews’s posts have frequently been on Basic Income News. 

Matthews was included in Politics Daily’s “five rising stars under 25” and started his own politics blog, MiniPundit, at age 14.  He attended Harvard University where he wrote for The Harvard Crimson, and he has worked with Ezra Klein extensively over the past five years at both Vox and The Washington Post.

The following are links to his posts on the universal basic income:

Dylan Matthews “Obama doesn’t want to just write welfare recipients checks. But what if we did?” The Washington Post, 8 August 2012.

Dylan Matthews, “A Fox News anchor just endorsed something you’d never expect.”, The Washington Post, 16 November 2013.

Dylan Matthews, “Five conservative reforms millennials should be fighting for,” The Washington Post, 7 January 2014.

Dylan Matthews, “More evidence that giving poor people money is a great cure for poverty”, Vox, 7 June 2014.

Dylan Matthews, “Mexico tried giving poor people cash instead of food.  It worked.”, Vox, 26 June 2014.

Dylan Matthews, “Giving everyone a basic income would work for the same reasons Social Security does”, Vox, 30 July 2014.

Dylan Matthews, “A guaranteed income for every American would eliminate poverty — and it wouldn’t destroy the economy”, Vox, 05 August 2014.

Dylan Matthews, “Basic income: the world’s simplest plan to end poverty, explained.” Vox, 8 September 2014.

Dylan Matthews, “To Fix the Economy, Let’s Print Money and Mail it to Everyone.” Vox. 9 September 2014.

Dylan Matthews, “We know how to end poverty. So why don’t we?”, Vox, 14 November 2014.

UNITED STATES: Fundraiser Started for Film on the Basic Income

 [Josh Martin]

Film production group Tree Media are trying to raise $675,000 for the production of a movie on the basic income they are titling Total Freedom.  On their page on Indie Go Go, they outline reasons for creating a film on the basic income and cite many major thinkers who have supported the policy in the past. They also provide plenty of information explaining how they came up with the $675,000 number.  The fundraising will continue until February, at which point they will begin production and hopefully finish the project by December 2015.

To view their fundraising page, click here.

3. Events

BROOKLYN, NY & ONLINE: Meeting to Discuss a Political Movement for Basic Income, March 1, 2015

Interest in Basic Income—an unconditional cash income for all citizens without means test or work requirement—is taking off around the world. Activists groups have formed and become more active around the world. Some political parties have endorsed the idea. Writers around the world are increasingly discussing Basic Income as a response to technological unemployment, precarity, and even as part of a solution to the climate problem.

With all this activity around the world, interest in the formation of an American political movement for Basic Income is growing. Toward this effort the USBIG Network will host an open meeting for anyone interested in a political movement for Basic Income in the United States. Everyone is welcome to attend. All points of view are encouraged. It will be an open discussion with no preset agenda and no list of speakers.

Let’s get together; talk it over; and see what happens.

The USBIG Network has been around since December of 1999, but it is not an activists’ group. Its goals have been to increase discussion and research into the topic. To have an activists’ group, either USBIG will have to change or a new, separate organization will have to form. Thus at the close of the 14^th Annual North American Basic Income (NABIG) Guarantee Congress, USBIG will organize this public discussion.

Everyone who is interested in discussing this issue is invited to come. Anyone who can’t be there in person is invited to participate online (we’ll announce details about how the meeting will be connected to the web later). We’ll be using an open format that gives everyone opportunities to participate actively, equally.

We request anyone interest in helping with the event to contact us. If you have a place in the city where you can put people up who are coming to town for the meeting, please contact us.

We’ll have pizza and drinks. We’ll take up a collection to pay for them, but they’ll be distributed unconditionally—even to those unwilling or unable to contribute to the costs.

Time & date: 6:30pm, Sunday March 1, 2014
Location: The Commons Brooklyn, 388 Atlantic Avenue Brooklyn, NY 11217 (easy to get to by subway from the rest of New York City)
Contact: Karl@widerquist.com

New York, NY, United States: Registration open for NABIG Congress, Feb. 26-Mar. 1, 2015

Registration has opened for the 2015 North American Basic Income Guarantee (NABIG) Congress, most of which will take place as a section of the Eastern Economic Association’s (EEA) Annual Conference at the Sheraton Hotel in New York, NY, February 26-March 1, 2015. More than forty authors and activists will participate at the Congress. The Congress will also include two free events outside the Hotel, a public discussion at Hunter College on February 26 and an activists’ meeting at the Brooklyn Commons on March 1.

Anyone wishing to attend the main events at the Sheraton must register with the EEA. Any NABIG participant can register for the discounted fee of $110 by going to this special website: http://eeaorg.myshopify.com/products/usbig-registration-non-academic

Economists must pay the full registration fee of $175, which includes membership in the EEA. Economists can register at the main website: http://eeaorg.myshopify.com/collections/conference-registration-and-event-tickets

The on-site registration fee will be $185.

Florence, Italy: Conference: The Future of Basic Income Research, Call for Abstracts

The Max Weber Programme at the European University Institute in Florence, Italy has released the following call for abstracts for the following conference: on “The Future of Basic Income Research:”

The Max Weber Programme at the European University Institute (Florence, Italy) is proud to launch the following call for abstracts for a conference on the topic of universal basic income.

• When: 26-27 June, 2015
• Where: European University Institute (Florence, Italy)
• Keynote Speakers: Philippe Van Parijs and Yannick Vanderborght
• Deadline for submission of abstracts: 15th of February
• Conference organizers: Juliana Bidadanure and Robert Lepenies
• Conference website: http://www.eui.eu/…/June/TheFutureofBasicIncomeResearch.aspx

The past three decades have seen the elaboration of a vast body of literature on universal basic income – a policy proposal Philippe Van Parijs referred to as a “disarmingly simple idea”. It consists of a monthly cash allowance given to all citizens, regardless of personal desert and without means-test. Basic income studies are an example of successful interdisciplinary research, involving philosophers, economists and sociologists, among many others. Basic income (BI) proponents have identified, evaluated and deconstructed many potential and actual objections against this radical proposal. Yet for young scholars interested in, but new to, basic income, the field might seem crowded and overwhelming. This conference aims to look into the future of basic income research: Which questions have been left unanswered, which questions should be posed? What should be on the research agenda for the next 10 years?

We invite submissions of abstracts of no more than one page for the conference that will take place on Friday June 26th. Please also provide a short biographical sketch. The deadline for submission is February 15th 2015.

We are also pleased to announce that the conference will also feature a book workshop on Saturday June 27th. Philippe Van Parijs and Yannick Vanderborght will discuss with select participants their new book manuscript on basic income. All participants are welcome to join the workshop. Those interested in acting as discussants are invited to email us.

Please confirm your attendance to both the conference and the workshop by emailing Juliana Bidadanure (Juliana.Bidadanure@eui.eu) or Robert Lepenies (Robert.Lepenies@eui.eu).

See the detailed call for abstracts here: http://mwpweb.eu/1/178/resources/document_798_1.pdf

4. BI Literature

Adam Cowden, “Moving Forward After Ferguson and Staten Island”

[Liam Upton]

The author discusses the recent controversial deaths of Michael Brown and Eric Garner and goes on to discuss the issue of poverty in black America. At the end he proposes a Basic Income as a way to releive or fix this problem.

Adam Cowden, “Moving Forward After Ferguson and Staten Island”, The Huffington Post UK, 10 December 2014

Amanda Johnson, “Bitnation Will Test Whether Basic Income is Actually Workable”

[Jenna van Draanen]

SUMMARY: The author announces an application that can run on Bitnation to allow for users to contribute to and benefit from a basic income, using the app. The article describes the app as a way of voluntarily sharing money, without taxation, that could pay for a basic income for those who need it.

Amanda Johnson, “Bitnation Will Test Whether Basic Income is Actually Workable” Cointelegraph. December 27, 2014.

Carlos Fresneda, "¿Una renta básica europea? [An european basic income?]"

The Spanish newspaper El Mundo, in its online version, reports on the first summit of the Unconditional Basic Income Europe (UBIE), which took place in Athens on the past 28th of September. In this event, several top economists and activists which defend the unconditional basic income have participated, such as Stanislas Jourdan, Guy Standing and Lluís Torrens.

Language: Spanish

Carlos Fresneda, "¿Una renta básica europea? [An european basic income?]", El Mundo, September 28 2014

CBM, “Bitnation Announces Basic Income Application”

[Jenna van Draanen]

CBM, “Bitnation Announces Basic Income Application” Cryptobiz Magazine. December 26, 2014.

Chandra Pasma, "Basic income programs and pilots"

This article lists and summarizes recent pilot projects implemented globally.

Chandra Pasma, "Basic income programs and pilots", Basic Income Canada Network, February 3 2014

Clarissa Hayward, Lynn Oldham, and Laura Rosenbury, “What now? Three ways to tackle structural injustice”

 [Josh Martin]

Hayward, Oldham, and Rosenbury write from St. Louis right after the ruling in the Michael Brown case that happened just a few miles away in Ferguson, Missouri.  They argue that tackling racial tensions requires an understanding of the structural problems in the St. Louis metropolitan area and that one percent of the gross metropolitan product should be put toward three goals: excellent education, new conceptions of community via land use planning, and a “solidarity economy” that seeks to help those on the bottom.  In this third goal, they mention the need for a guaranteed income for all that meets their basic needs.  This could take the form of a basic income for all in the St. Louis metropolitan area.

Clarissa Hayward, Lynn Oldham, and Laura Rosenbury, “What now? Three ways to tackle structural injustice”, STL Today, 26 November 2014.

Daniel Raventos and Julie Wark, “The X-Rated Free Market”

[Josh Martin]

Raventos and Wark seek to debunk the belief that the wealthiest citizens deserve their money.  They argue that there are almost no true free markets, and look to the pornography sector as the closest thing to a free market, pointing out that the pay for actors in the pornography industry are far lower and more gendered than the corresponding pay for the Hollywood elite, which represents a far less than free market.  They also use royal succession to point out how easy some wealthy people have it.  In all, Raventos and Wark note that a basic income might help restructure the economy to help fight this inequality.

Daniel Raventos and Julie Wark, “The X-Rated Free Market”, Counterpunch, 31 October 2014.

Daniel Tencer, "What you should know about the idea that could revolutionize the 21st century"

The article briefly describes negative income tax and basic unconditional income and comments with some detail on the Canadian situation in this regard, adding possible implications of the implementation, viewed from both sides of the political spectrum.

Daniel Tencer, "What you should know about the idea that could revolutionize the 21st century ", The Huffington Post Canada, December 23 2014

Elizabeth Edgett, “Unconditional Basic Income – an Economic Model for a New Renaissance”

[Josh Martin]

Edgett’s article provides an introduction to the unconditional basic income.  By eliciting arguments on robots and automation, Edgett believes the basic income can solve many of the problems society will face in the next 100 years.  Edgett then discusses the economic repercussions and subsequent “renaissance of human creativity” from the implementation of a basic income.

Elizabeth Edgett, “Unconditional Basic Income – an Economic Model for a New Renaissance”, Wake Up World, 24 November 2014.

The Georgist News, “Social Media: Libertarians Battle Over a Citizen’s Dividend”

 [Josh Martin]

This post discusses the libertarian debate over the basic income at the Cato Institute.

The Georgist News, “Social Media: Libertarians Battle Over a Citizen’s Dividend”, Georgist.com, 26 September 2014.

Guy Standing, “Cash transfers can work better than subsidies”

 [Josh Martin]

In this opinion piece in an Indian newspaper, Guy Standing, who was one of the driving architects behind the Indian basic income pilot projects in the past few years, argues for a basic income as a better alternative to the large subsidies in place that are aimed to help those in poverty buy goods at discounted prices.  Standing points out the inefficiencies of the subsidy programs and then promotes the three main effects of the basic income: it improves personal and community welfare, stimulates growth, and harbors an emancipatory value that boosts the other two effects.

Guy Standing, “Cash transfers can work better than subsidies”, The Hindu, 6 December 2014.

Ian Mount, "What might soothe Europe's economic pain? Cash handouts"

Ian Mount, "What might soothe Europe's economic pain? Cash handouts", Fortune, November 18 2014

Jon Maiden, “Citizen’s Income: A Vision of a Better Future”

 [Josh Martin]

Maiden’s post is written from the year 2045 under the assumption that a basic income was adopted in 2025.  It details the historical context in which the basic income was adopted and then outlines its effects on society, including the emergence of an entrepreneurial revolution.

Jon Maiden, “Citizen’s Income: A Vision of a Better Future”, Now Then, Issue 81, December 2014.

John Muellbauer, "Quantitative easing for the people"

Oxford Economics professor John Muellbauer elaborates a rational justification and a simple application plan for giving each EU citizen a 500 €, no strings attached, monthly payment. The money would be printed in the European Central Bank and simply given to registered citizens in the eurozone.

John Muellbauer, "Quantitative easing for the people", The New Times, November 7 2014

Jordi Arcarons, Antoni Domènech, Daniel Raventós, Lluís Torrens, "Un modelo de financiación de la Renta Básica para el conjunto del Reino de España: sí, se puede y es racional [A basic income finance model for all Spanish Kingdom: yes, it can be done and is rational]"

Results from this recently published article show that basic income within all Spanish territory can be financed at approximately 7500 € per year for each adult person and 20% of that value for each child. The authors state none of the basic state functions (e.g.: education, health) need cuts in order to finance basic income, with reforms in taxation and savings from all benefits already given by the state, which need not exist when the basic income is implemented, paying for its implementation.

Language: Spanish

Jordi Arcarons, Antoni Domènech, Daniel Raventós, Lluís Torrens, "Un modelo de financiación de la Renta Básica para el conjunto del Reino de España: sí, se puede y es racional [A basic income finance model for all Spanish Kingdom: yes, it can be done and is rational]", Sinpermisso, December 7 2014

Koeppelmann, “Basic Income (CIRCLES) - reputation/market based approach to solve the identity problem/Sybil attacs”

[Josh Martin]

This post contains a proposed structure for a cryptocurrency based basic income.

Koeppelmann, “Basic Income (CIRCLES) - reputation/market based approach to solve the identity problem/Sybil attacs”, Ethereum, 21 November 2014.

Lane Anderson, “What can we learn from a town that beat poverty.”

This article begins, “It sounds like something from a Utopian novel, but for five years, a small Canadian city ensured basic incomes for everyone. And for five years, poverty vanished…”

Lane Anderson, “What can we learn from a town that beat poverty.” Desert News National, January 5, 2015

M. Oliver Heydorn, “The (Big!) Difference Between a 'Basic Income' and the National Dividend”

[Josh Martin]

Heydorn writes from the perspective of those enamored with the idea of a Social Credit proposal for a National Dividend.  In this blog post he outlines the differences between such a dividend and a basic income.  First, he acknowledges the structural differences.  While a basic income is fixed at a level, the dividend would be fixed to productivity: no productivity, no dividend.  Secondly, he claims that the purpose of the basic income is to achieve full employment, while the dividend is supposed to encourage leisure.  Lastly, Heydorn says a basic income would be financed through currently in place means, but a dividend should be issued by a newly created National Credit Office.  For these reasons M. Olver Heydorn argues that those in favor of the Social Credit should hesitate to support a basic income and should instead seek to convince basic income supporters to join them instead.

M. Oliver Heydorn, “The (Big!) Difference Between a 'Basic Income' and the National Dividend”, Socred.org, 30 October 2014.

Maciej Szlinder, “The Strategy for Basic Income: Interview with Guy Standing.”

Maciej Szlinder conducted this interview with Guy standing during Standing’s visit to the University of Wrocław. During the interview, Standing discusses evidence about Basic Income gathered from around the world and the application of Basic Income as a strategy particularly in Poland and Eastern Europe.

Language: English with link to Polish translation.

Maciej Szlinder, “The Strategy for Basic Income: Interview with Guy Standing.” Czasopismo Naukowe, 13 November 2014.

Mathew Schmid, "The next big social idea: unconditional basic income"

To face rising inequality and social catastrophe, unconditional basic income, this articles defends. Focused on its advantages, the author highlights its potential transformations in society.

Mathew Schmid, "The next big social idea: unconditional basic income", The Huffington Post Canada, December 22 2014

Matthew Ward, “State of the Arts—a guest post about Basic Income”

 [Josh Martin]

Ward writes this piece on his sister’s blog on the issues facing artists in the 21^st century.  Ward argues that capitalism makes life especially difficult for artists since their work is priced and sold just like every other good and service.  Through this artistic lens, then, Ward advocates a basic income as a remedy for capitalism’s strain on artists.

Matthew Ward, “State of the Arts—a guest post about Basic Income”, Blog Cabin by Vic, 4 December 2014.

Nick Barlow, “Liberal Democrats for Basic Income, anyone?”

[Josh Martin]

Barlow discusses the reasons why the Liberal Democrats in the UK should include the Citizen’s Income, also known as the basic income, in its party manifesto.  In fact, the Liberal Democrats had it in their manifesto from 1992 to 1994, and Barlow hopes to encourage other Liberal Democrats to support it once again.

Nick Barlow, “Liberal Democrats for Basic Income, anyone?”, What You Can Get Away With, 2 December 2014.

Pramit Bhattacharya “Subsidies must give way to a universal basic income: Pranab Bardhan.”

Pramit Bhattacharya “Subsidies must give way to a universal basic income: Pranab Bardhan.” Live Mint, Dec 13 2014.

Renana Jhabvala, “No conditions apply.”

This opinion piece discusses results of the recent Basic Income pilot project in India.

Renana Jhabvala, “No conditions apply.” The Indian Express, December 9, 2014.

Sam Becker, “Is it Time to Consider a Basic Income?”

[Josh Martin]

Becker’s post serves as an introduction to the basic income for those who are unfamiliar with it.  He begins by noting Thomas Paine’s support for such a policy and then argues that it could be a good policy for America due to its ability to fight poverty and inequality.  While politically unfeasible at the moment, Becker claims that this idea needs to be discussed as a policy option.

Sam Becker, “Is it Time to Consider a Basic Income?”, Wall St. Cheat Sheet, 19 September 2014.

Sam Bowman, “The Negative Income Tax and Basic Income are pretty much the same thing”

 [Josh Martin]

This post seeks to equate the Negative Income Tax (NIT) and the Basic Income (BI).  Bowman’s main point is that both policies effectively withdraw the benefits as earned income rises, but it is withdrawn at the front end in the NIT and at the back end in the BI through a modified tax system.

Sam Bowman, “The Negative Income Tax and Basic Income are pretty much the same thing”, Adam Smith Institute, 23 May 2014.

Scott Santens, “Negative Income Tax (NIT) and Unconditional Basic Income (UBI)”

[Jenna van Draanen]

Scott Santens, “Negative Income Tax (NIT) and Unconditional Basic Income (UBI)” Scottsantens.com. December 17, 2014. 

Jean-Eric Hyafil & Leon Regent, “Le revenu de base, ce n’est pas sorcier… chiffres à l’appui [ Basic income, it’s not rocket science… supporting figures]”

[Jenna van Draanen]

SUMMARY: This article provides economic figures that support the facts and presentation of data in the short films produced by the organization Mouvement Français pour un Revenu de Base.  It details the financing of a basic income in France, what the resulting impact would be on different individuals and family compositions, and the tax structure that would support a basic income in France.

Language: French

Jean-Eric Hyafil & Leon Regent, “Le revenu de base, ce n’est pas sorcier… chiffres à l’appui [ Basic income, it’s not rocket science… supporting figures]” Revenue de Base. December 18, 2014.

Scott Santens, “Payday Loan Lenders Are Unstoppable. . . Or Are They?”

[Josh Martin]

Utilizing the momentum against payday loan lenders generated by HBO’s John Oliver, Santens takes the opportunity to highlight the basic income’s impact on indebtedness.  Using results from the basic income pilot projects in India and Namibia, Santens shows how effective the unconditional transfer is at combating indebtedness.

Scott Santens, “Payday Loan Lenders Are Unstoppable. . . Or Are They?”, Medium, 16 August 2014.

Scott Santens, “5 Steps to Becoming a BIG Contributor”

[Josh Martin]

Santens writes this piece on his personal blog on how one can help personally push the basic income movement forward.  He outlines it in five steps: Become Knowledgeable, Interact with Others, Create Content, Organize Locally, and Organize Nationally (and then Globally).

Scott Santens, “5 Steps to Becoming a BIG Contributor”, Scott Santens Blog, 4 December 2014.

Simon Jenkins, “We should cash-bomb the people - not the banks”

[Josh Martin]

This article scrutinizes the pro-banker approach the EU has taken in the aftermath of the recession and argues that we should be giving the money to the people instead.  Jenkins discusses the QE practiced by the US and the EU and mourns its shortcomings.  In contrast, Jenkins mentions the policy put forward by John Muellbauer to create “QE for the people” as a sort of basic income to the citizens instead of channeling the money to the banks.

Simon Jenkins, “We should cash-bomb the people - not the banks”, The Guardian, 26 November 2014.

Toru Yamamori, “Why Basic Income Now? Limitations of the Japanese Welfare State”

Yahoo Japan, a Japanese online news site features Basic Income. In the first article written by Toru Yamamori, he explains failure of the Japanese Social Security systems. The article also contains information on Guy Standing talk on Basic Income at the International Sociology Association in Yokohama.

Toru Yamamori, “Why Basic Income Now? Limitations of the Japanese Welfare State,” Yahoo Japan News, July 11, 2014.

Zi-Ann Lum, "A Canadian city once eliminated poverty and nearly everyone forgot about it"

This article recalls the "Mincome" experiment in Dauphni, Canada, while analyzing past and present conditions in the country for implementing a basic unconditional income.

Zi-Ann Lum, "A Canadian city once eliminated poverty and nearly everyone forgot about it", The Huffington Post Canada, December 23 2014

Zi-Ann Lum, “A Canadian City Once Eliminated Poverty And Nearly Everyone Forgot About It”

[Liam Upton]

Zi-Ann Lum, “A Canadian City Once Eliminated Poverty And Nearly Everyone Forgot About It”, The Huffington Post Canada, December 23 2014

5. Audio-Video

VIDEO: Evelyn Forget Speaks to Finnish Parliament About Canadian Basic Income Pilot Project

Evelyn Forget, “Speech to Finnish Parliament”, YouTube, 1 December 2014.

Video: Dylan Matthews, “We know how to end poverty. So why don’t we?”

 [Josh Martin]

Matthews has written extensively on the basic income on Vox, and his most recent work is this brief two minute video explaining the history of basic income ideas in the USA, including policies produced by President Nixon in 1969 and the Negative Income Tax experiments in the USA in the 1970s.

Dylan Matthews, “We know how to end poverty. So why don’t we?”, Vox, 14 November 2014.

6. New Link

LINK: Basic Income on Medium.com

A collection of basic income-related articles published on medium.com. Edited by Jax Blunt.

Jax Blunt, “Basic Income”, Medium

9. More news, links and other info

For up-to-the-day news on BIG, see Basic Income News. For links to dozens of BIG websites around the world, go to USBIG’s links page. These links are to any website with information about BIG, but USBIG does not necessarily endorse their content or their agendas.

The USBIG NewsFlash
Editor: Karl Widerquist
Thanks to everyone who helped this issue.

The U.S. Basic Income Guarantee (USBIG) Network publishes this newsletter. The Network is a discussion group on basic income guarantee (BIG) in the United States. BIG is a generic name for any proposal to create a minimum income level, below which no citizen's income can fall. Information on BIG and USBIG can be found at USBIG’s website. More news about BIG is online at BInews.org.

You may copy and circulate articles from this NewsFlash, but please mention the source and include a link to Basic Income News. If you know any BIG news; if you know anyone who would like to be added to this list; or if you would like to be removed from this list; please send me an email: Karl@Widerquist.com.

As always, your comments on this NewsFlash and the USBIG website are gladly welcomed.

Thank you,
-Karl Widerquist, editor

-- 
Karl


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Karl Widerquist
Associate Professor at SFS-Qatar, Georgetown University
3300 Whitehaven Street, N.W.
Suite 2100, Harris Building
Washington, D.C. 20007-2401
US cell phone: +1 504-261-0891
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Qatar fax: +974 4457-8231
EMAIL: Karl@widerquist.com
Website: http://works.bepress.com/widerquist/
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Quote of the moment:
"it's unfair that you can get judged by something you didn't do, 
but it’s also unfair that you can inherit money that you didn't work for."
-Chris Rock
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