How to stop wrecking the ecosphere [Start here]

At the Launch of XR in October 2018, Greta Thunberg asked:

If climate change is an existential threat, why is nobody talking about it?

Greta, here are two powerful reasons why (not):

In a growth oriented world, whoever (individual, tnc, or nation) stops doing what is destroying the ecosphere, all they do is put themselves at a disadvantage

Also profits would be foregone.

Governments cannot change until elected by voters who will be terrified by the necessary measures. Only if individuals are sure of basic needs, dare they elect governments who propose those measures.

Until a better idea emerges, a basic income will make that necessary mind set change possible

Economic growth used to mean more prosperity, but now it threatens to wreck the ecosphere – the only known home for life.

We environmentalists urge everyone to repair recycle and re-use, not to use cars, or to fly,to stop eating meat, and to have fewer children, all necessary if humans are to live within what the ecosphere can provide. I could go on, but

this will decimate several staple ‘wealth producing’ industries.

Here i s an attempt to put it into bullet points:

  • Human populations have been expanding exponentially for 200,000 years.
  • Physical limits end exponential growth suddenly. (Think milk turning sour)
  • But formerly successful strategies, now destructive, persist
  • Per capita consumption may now be more serious than population increase.
  • A catalyst is needed to give everyone security as expectations are lowered to what is sustainable..
  • No one has yet suggested anything better than a universal basic income.

If you are busy, you can stop reading now. The rest is further explanation of likely questions, but suggested next reading is the ‘Page’ on The Tragedy of the Commons (Harding’s Insight)

The ‘ Gunslingers’ Cartoon https://simpol.org/ demonstrates the problem, but vested interests have obscured this with a highly successful climate change denial campaign, and everybody still fears a recession.

Some environmentalists believe that ‘Green growth’ will cushion the necessary downsizing. That might have been possible if we had started in response to the MIT warnings in 1972, but its main weakness is that it relies on new technology to avoid the need for a mindset change. There is also sleight of hand with ‘offshoring‘. Expectations will have to change from consumerism to something more akin to Buddhism. Starting in 2020, Green Growth is not an option. Contentment within limited resources is – possible.

But the shift away from consumerism is extremely unlikely without that mindset change giving confidence that needs will be guaranteed. You cannot think about downsizing if you do not have much to start with.

The British welfare state always had a serious flaw. The withdrawal of means tested benefits is a form of taxation, as the graph above this Page shows. It is from the report by a Think Tank set up by Iain Duncan Smith which set out the case for the Universal Credit: Dynamic Benefits: Towards  Welfare that Works (Sept 2009)

I agree with most criticisms of the Universal Credit. but some of its weakness is due to George Osborne’s implementation not sticking to the original ‘ThinkTank’ proposals. There was no mention of benefit sanctions and I do not think the late payment rule was in the original plan.

But Dynamic  Benefits would not need much amendment to present a coherent case for

the unconditional basic income (UBI).

The UBI gives individuals basic needs so that they can make personal decisions on what not to buy. As long as growth is the norm, less is politically unthinkable. A climate denial campaign has saved four decades of mega profits, but those making profits are now ‘gunslingers’ not able to stop what they are doing unless all the others do.

It is generally assumed that a UBI must wait until formidable problems have been solved, notably over housing cosgts. But there is a climate emergency. We can discuss it now, without minimizing problems. The onset of the CV19 pandemic has strengthened a ‘first aid’ case for the UBI. The potentially astronomical sums thrown at the virus by the Chancellor make a nonsense of the affordability objection to the UBI.

The original Dynamic Benefits case for the  ‘Universal Credit’ makes clear that:

Taxes are paid by individuals to public bodies;

Benefits are given to individuals by public bodies

Therefore, to the individual the withdrawal of a benefit has exactly the same effect as a tax.

There is of course no mention of a UBI in Dynamic Benefits, nor of the environment, but incredibly, this report by the Economic Dependency Working Group of the Centre for Social Justice starts by making a devastating and thorough critique of the effect of the withdrawal of means tested benefits. Dynamic Benefits explains:

Those who avoid entering the labour market are making a rational decision

The surprise is how few actually take this rational decision.

Most people coming ‘cold’ to the UBI think of it as a handout. Why would anybody work? Dynamic Benefits shows that on the contrary the UBI will remove the work disincentive of means testing, whereas Universal Credit, even without the delay, does so clumsily and marginally. Guy Standing explains that the UBI is a right, not merely an anti-poverty strategy.

You might expect Dynamic Benefits to include a graph showing the effect of the Universal Credit. It did not, precisely to avoid the above ‘naive’ questions.

The Universal Credit as now constituted reduces the ‘mountain’ of tax rate equivalents in excess of 80% on low incomes to a ‘plateau’ at 63%, which rises to over 70% when National Insurance is taken into account.

It has been possible ever since Dynamic Benefits was published to ask this simple question:

Why not produce a straight, level line, so that everyone, on high, low or no earnings is on the same basis?

What would the tax rate have to be to give everyone an unconditional basic income, and tax everyone at the same flat rate on all other income? The amount of the UBI is a separate discussion.

The government has access to high powered computers. If they revealed that the tax rate required to fund this arrangement is impossibly high, the nation is already bankrupt. But of course that is not the case,  Work done by Richard Murphy and Howard Reed suggests that even if financed entirely out of personal income tax, that would be around 60%, considerably lower than the rich paid willingly in the 1940s. Other forms of taxation, notably Land Value Tax and ecological taxes would bring this personal tax rate down considerably.

But what if an MP (or whoever) were to continue, naively,

“On what grounds is anything other than putting everyone on exactly the same basis justified”?

Why not give everybody a sum of money, and take 60% from all other income?.

And it might help to save the ecosphere.