Covid 19 budget (March 2020) and basic income

A formidable array of organizations had already sent this letter to Rishi Sunak, stating that the basic income would provide comprehensive first aid for large numbers at risk of hardship due to the likely advance of Covid 19.

I make the same point in my latest weblog post (9.3.20), but once in place, if linked to the much more serious climate crisis which is also advancing, an unconditional basic income (UBI) can form part of the basis for a permanent steady state economy.

It will do so because it will allow individuals to decide how to downsize – make decisions they dare not make at present as to what not to buy because it is harming the ecosphere. As they do that, the economy will gradually begin to contract. Covid 19 has rather rudely started this essential process. We humans must reclaim and build on it, not as this budget does, return to consumer based growth as fast as possible.

The budget does contain generous ‘first aid’ measures. But it does so piecemeal, with no coherent thread, and even collectively they would not give the millions terrified of a recession, whatever the cause, that sense of personal choice as to what they could do without, if it would save the ecosphere for their grandchildren.

But Rishi Sunak, the Chancellor of the Exchequer, must be oblivious of the opportunity to solve two problems (or at least to start the process).  He is abolishing Entrepreneurs Relief. In isolation, this appears to make sense. Of course we want genuine entrepreneurship. But one of the key advantages of a UBI is the lifeline it gives to small businesses generally, whatever the state of the economy. I often rail against socialists who insist on the living wage, something else the Chancellor bizarrely approved of in his presentation. In an ecologically sustainable economy, a living wage will prevent the formation of potential eco-friendly businesses which do not yet exist.

I leave to others an assessment of how effective this budget will be in parrying Covid 19, But one of the experts commenting on Radio 4 immediately after the Chancellor sat down, said he was scratching his head as to where all this money was coming from. He could envisage only massive borrowing or massive growth. Widening inequalities would give some scope for redistribution, but that would need a change in mind set.

I fear that ending in tears is the best we can expect.

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