Switzerland will vote on having a national wage of £1,700 a month
independent.co.uk
independent.co.uk
So far, there were about 2 or 3 unconditional income law proposals in the last 10 years, and they were all voted "no". Thankfully. Because "unconditional income" will not magically appear from nowhere, it will be provided from my salary. And my company's income (at this point, I have to pay around 18,000 francs per year even if my company doesn't do anything to finance all social programs already there — so much for "unconditional income"). And I have to pay another 6,000 francs per year for obligatory medical insurance in Switzerland. And I won't be able to receive this "income" anyway, as I am not a Swiss citizen — I just live here and have a company here, and I have to pay _a lot_ for this.
Money don't grow on trees. It always have to be sourced from somewhere. And not from some nameless "rich corporation" — it will be sourced from my already struggling business. And from yours. And from your salary.
Productivity, gained through software and automation, can be used to deliver quality of life improving services at zero marginal cost.
I'm not going to spend this entire comment rehashing the ongoing debate over how much of the world's economy is going to get eaten by this, but suffice it to say I roll my eyes _hard_ now when someone says money doesn't grow on trees.
With enough effort, you can automate every job out of existence. Its just a) how much effort you choose to exert and b) the order in which you do so. Can't these productivity benefits be distributed through consumer excess, and in a roundabout way, be used to deliver a basic income? And if someone complains about their hard earned $fiats, what's to say their job isn't next to be obsoleted?
Incidentally, this was exactly the reason of demise of the Roman Empire. Instead of robots, there were slaves captured in military conquests (slavery is morally wrong, of course, but it was "sustainable" and there were no significant slave uprisings). But it didn't end well.
I am envisioning a world where ultra-generous industrialists give away their wealth to help the world. You cannot say it cannot happen; it has/already is happening.
Indulge me for a moment, but isn't Bill Gates (along with Warren Buffet) giving away almost all their entire net worth in a very results-driven way to help raise the quality of life for the very worse off? And did Elon Musk (no fan boy comment here, just truth) not give away (really, offer to license at a very small cost) the patents necessary for existing vehicle manufacturers to make better electric cars?
Not everyone is greedy. Not everyone is an ultra-rich capitalist.
The answer is ONE WEEK.
Throwing Buffet, Musk, Zuckerberg and all other rich ultra-generous industrialists in the equation will probably extend the runway to several months, perhaps a year. But that would be it.
The bulk of purchasing power in capitalist countries is still produced by working middle class.
The US government spent $3.5 trillion in FY2014, according to Wikipedia.
I'm not claiming that simply taking all the billionaires' wealth is any kind of solution, but that doesn't justify obscuring the facts.
When politicians start talking about taxing the rich more, they are really talking about the upper-middle class in the US. Otherwise there just isn't enough money higher up the income ladder to make it work.
I remember the NDP in Canada being asked who the rich were (back in a 1990's election). The said a family of 4 making more than $60,000 per year.
I have to give them credit for being honest.
Because then we get into this real uncomfortable argument, don't we? About what ownership is? Because when you're taxed, people will say that's theft of what they've "earned". But the wealthy don't earn like everyone else. They earn as rentiers, of either land, capital, or intellectual property.
I'm suggesting the entire ownership model is going to need to be turned on its head. Otherwise, those who own what the rest of the world needs will continue to siphon wealth out of the economy, to the detriment of everyone else.
And this is the future, at the rate we're going.
You probably meant "corporatists".
Pessimist.
Future of capitalism is worker owned cooperatives.
https://en.wikipedia.org/wiki/Worker_cooperative
Advances like universal health care and basic income enable self-organizing democratically governed means of production. Where the surplus (profit) is shared amongst the participants, vs gobbled up by the executive class.
These are all problems that are going to need to be worked out, but I have hope they will be!
Oh, please, go run a business with 20+ employees for ten years and then come back to this comment. You'll see juat how ridiculous it actually sounds. Until then, please stop thinking you understand how a business runs, 'cause you don't.
Automation isn't necessarily the end of all jobs.
Even lower-middle class professions like teaching, nursing, policing, office admin, etc are much less routine than people realise. (Tech is obsessed with the idea of, e.g., replacing teachers with e-learning software, but what usually happens is that the teachers end up using the e-learning software as another tool to do their job).
Vehicle automation is one large area I can genuinely see becoming automated (possibly the success in this area is because the AI doesn't need to manipulate the environment, just navigate through it). There are still many blue collar jobs which are really hard to automate - cleaning, gardening, building maintenance, etc, etc.
(Honestly, I see the most likely outcome being that first world countries develop a grey-market, third-world economy, where low-income people work cash-in-hand, below-minimum-wage jobs running cheap food stalls, cleaning laundry, or offering other convenience services on the cheap. It's not as utopian as everyone getting a basic income and using their unlimited free time to paint watercolours, but it works out as a more robust social safety net).
Maybe it's different in Switzerland, which I doubt, but in other countries in the EU you don't 'go broke' if you just follow the rules blindly. Many people actually do that with their companies and they do fine. It is true you could be making more with creative accounting but at a risk; going broke if you don't is a bit too strong imho.
Probably the only European country that can follow the tax/accounting rules to the book is Denmark. They have high taxes, but very simple tax code. The rest (and the US) are the maze of regulations, exceptions, exceptions to exceptions, applicable limits and human interaction. People are safe from machines here. Sadly.
"With enough effort, you can automate every job out of existence."
The example I've used has been self scanning checkout lines at grocery stores. They replace 16 cashiers at $10/hr with one "supervisor" at $16/hr. The additional margin goes to the grocer. If instead the productivity went to a basic income program then, the price of groceries would be the same, the grocer's income would be the same, but now there would be money "appearing out of thin air" for a basic income program. But what is really happening is that you've automated a human job, captured all that GDP in the process.
If you think about it that way, it changes how you see automation, and productivity gains.
Automation is inevitable, but unfortunately for the American working class, all of the benefits of improved efficiancy will be going to a few (shareholders), just because you were conditioned to think 'socialism' is a bad word. I already see the sentiments being expressed here on HN rehashing the 'welfare queen' argument. I tell you what: a whole lot of you will be arguing for basic income when they automate your job, but it will be too late then. Good luck finding another job that's yet to be automated and pays anything in the same ballpark as your old one.
It does also create needs for different jobs. Instead of 10 cashiers @$10/hr, you now need 1 supervisor @$16/hr + a consulting company to install and integrate the machines @$300/hr + technicians to re-stock the machines and service them @$90/hr + customer support to help with software bugs in the new pricing system etc etc. Of course, you can then go and automate all of those jobs as well, but it seems a bit fractal until we have AI strong enough to build more AI where it's needed and consolidate existing AI, which I guess is what people are supposing leads to the extinction of humans since we're so inefficient.
The effort often is significantly outweighed by the cost and benefits realized.
The difficulty of fully automating anyone who services your home for instance. Plumbers, electrician, firemen, inspectors, hvac, carpenters, window replacers, roofers, etc etc etc.
Right now we are automating things which are overhead and easily repeatable, not things which require creative solutions and unique problem solving within a specific domain (eg A pipe broke and water is pouring into my basement, how do I fix this as fast as possible with the least property damage, and then ensure cleanup is done properly so dangerous molds dont arise?)
People always find new ways to employ their skills and we are richer because of it.
Im not against basic imcome proposles but you argumnet is still a terrible one. I think basic income would be a easy way to help those who for whatever reason can not provide for themself.
Basic income is a new way of organising the social safty net, and does not alter the fundamentals of the capitlaist society.
This looks like a good example of the Normalcy bias logical fallacy: https://en.wikipedia.org/wiki/Normalcy_bias
That it hasn't happened in 200 years doesn't mean it won't happen now.
Does the current proposal add without removing?
If it was truly universal - no exceptions, no means-testing, etc - then the "bureaucracy" around this one is negligible.
While I'm intrigued by a Basic Income approach, I don't think the bureaucracies would be willing to give up the power that they have to shape and influence people and society as a whole. It is exceptionally rare in human history that a government has given up power.
I think that is what will kill most of these Basic Income proposals, not even considering the math of taxes.
It's hard to make this point without going into all aspects of socialist thought. However, in basic, the reason most people produce now is to have enough to buy food and housing. The incentive for people to do above and beyond is to get wealthy for a big payout of some sort. However, while that does incentivize entrepreneurship, I think it's hard to argue that most of the ideas that come out of those efforts are socially beneficial.
I would argue it would actually require relatively little work in order to provide a high quality of basic necessities to all people (food, housing, healthcare), which would allow people to spend more time focusing on building out things that would be beneficial for society.
It's the tip of the iceberg at this point (in my opinion). Not to mention, as people move to AWS, what happens to all of the sales reps, sales engineers, implementation engineers, support staff, etc. at all of the major hardware manufacturers? Those jobs just go away...
I could take a article from a birish newspapers, 200 years ago, replace 'maschines' with 'robots' publish it in the NYT and most us Progressives would not notice it.
The arugment is the exact same, and it has been for 200 years.
Why is it different 'this time'? The computer has existed for a long time, it has replaced many jobs already and society did not collapse.
The pridiction that IT will be crushed is also not knew, I remember the 'all the jobs will move to India' crap. No to mention all the ink spilled on 'runable specifications'.
Especially not one that produces enough economic value for the employer to be able to offer a living wage from a strictly capitalist valuation.
Where did the majority of farming and manufacturing jobs go after their respective revolutions? The services industry. Do you really think it can hold that many more jobs? And if not there, where? Creative pursuits? Most people just aren't cut out to be artists...
-- Oliver Wendell Holmes, Jr.
Somalia's a crime-ridden hellhole - I'm not an anarcho-capitalist and I believe that freedom requires the rule of law. Hong Kong and Singapore are two places which remain close to the pre-WWI classical liberal ideal of genuinely free economies with the rule of law, and both have income tax rates of around %10 IIRC. I'm strongly considering relocating to the latter if the UK continues on its current trajectory.
The only things on that list I have a real problem with are freedom of speech and LGBT rights. Capital punishment and caning shock Westerners, but Singapore's legal system is actually fair and efficient; it's not like the procedural trainwreck which is the US justice system where countless criminals walk free and countless law-abiding citizens are rotting in jail.
Conscription is pretty much necessary for a micro-state sandwiched between two nations which historically hated their guts. Migrant workers aren't forced to be there (and unlike Qatar or Dubai, they're not generally lured in under false pretences). Even the freedom of expression rules are very similar to the de-facto/de-jure hate speech rules which exist in the West, and they exist for a similar reason - Singapore wants to minimise Chinese/Malay tensions.
EDIT: I just remembered that this HN user - https://news.ycombinator.com/threads?id=frenchieinsg - initially piqued my interest in Singapore. Might be of interest to others of similar mind.
Though, external capital is actually a good point to consider. Whatever social program I think a country decides to adopt, it need to consider a structure where it will remain attractive for capital investment. So as long as there is still a win/win situation between investor and the country's Citizens, I think it's fine, but if that's broken, like in full communism, it's generally a bad outcome for the long term prospect of a country.
These people are discouraged from working, because, if they are caught working in a manner that is inconsistent with their 'disability', they get in trouble, forfeit their benefits, and possibly jail/prison time for their fraud. But, I see these people routinely trying to work in any way they can get away with. True, some do not, either out of laziness or fear of discovery, but, as a whole, most still try to work.
If that income were replaced with a legal, basic income, I have no doubt more of these people would continue to work and seek work, probably more so since it would not be a risk to their freedom or basic income, and they are the ones currently trying to scam the system. These people are probably at least a subset(or superset) of the demographic that the non-supporters fear most will just leech off the system.
Of course in order to actually achieve any savings we would need to truly eliminate those other entitlements and fire all of the people that work in the departments that currently oversee them. That is the heavy lift politically.
The same is true for a lot of policies that make sense economically but may not survive contact with the political system. Major tax reform is another obvious example. Everyone knows we could have a variety of different tax systems that are economically better than the one we have today, but in order to get there we need to eliminate some tax carveouts that people love.
The pathway from today to the desired state can't just be hand waved away. If we added universal basic income, what entitlements are we eliminating? How much would that save? What parts of the government are getting shut down, and how much does that save? Who are the winners and losers in the new system?
Which is to say, there are situations where no one is really defrauding the system, but because the rules don't offer any soft landing people have to stay inside a system and can't explore the marginal contributions they are capable of making.
(Still this wouldn't remove the purpose and need for disability insurance, just remove some of the strange structures in it that have developed.)
EconTalk had a really good podcast on disability insurance: http://www.econtalk.org/archives/2012/04/autor_on_disabi.htm...
Hell, one of the ones locally, managed to get a PhD from the local university some years back but has not had a steady job in over two decades.
The idea of a basic income is interesting, but it would need to be couples with cleaning up some of the able bodied "self proclaimed" victims.
We can either just give them money, and not care if they label themselves as disabled; or we can make them jump through expensive hoops with complex bureaucracy and end up just giving them the money anyway.
I also see a PhD in CS spending all his time online and playing the victim for some made up disabilities (maybe there is a mental component). I'd like to see a bureaucracy that moves individuals like this into a required work/live support system.
We have a downtown cleaning crew of individuals with Down Syndrome helping out; we have recent immigrants busting their asses in the field, etc. Oh and we also have able bodied, poor mannered, self described disabled white people that refuse to do anything. My favorite was someone I knew through surfing out on "disability" for his back, but he'd still pull into 8-10' waves and was doing ding repair as well.
Personally, I like the idea of a basic wage, but I also know there are people that milk the system and want stop gaps for that too.
And you're pretty judgemental about mental illness. 20 years ago there was considerable stigma from employers, and less protection in law. Even if he'd wanted to work he would have faced discrimination. That discrimination still exists to some extent, though there are some protections. But now he has learned helplessness. People judging him doesn't seem to be getting him back into work. A programme following the Sainsbury Centre for Mental Health model ("place then train" - get someone a job, then support them and the employer to keep that person in the job) would be better, but those aren't common and they're always over-subscribed.
Also, if they're willing to be unethical and dishonest now, why would a guaranteed basic income change their mindset? They already have that.
In short: 1. Implemented a "right to work", everybody should have a work at a 2 francs a day 2. Parisian flocked to the state company so they paid anybody they could not give work to 1.5 francs a day for the "right to idle". Something like half the Parisians got paid like this. 3. People started to hear about this from outside the city and started to move to Paris. 4. As you can predict, it ended up as a collapse and one of the cause of this revolution.
Source Wikipedia or this abstract: https://books.google.com/books?id=rlhDAQAAMAAJ&lpg=PA866&ots...
I know people envision flocks of moochers, but how many countries suffer mass-unemployment? So many. How many parents would sacrifice everything for their children to live a better life?
Every one.
Let's be sure we all agree on the meaning of the expected amount: 2'235euros.
- Average rent: 1'000€ (assuming shared apartment) - Average base insurance: 350€ - Average public transportation monthly pass: 60€ - Average internet access: 50€ - Average mobile phone access: 30€ - Average income tax: 17% (lower quantile, insurances and transportation deducted): 318€ - Intermediate total: 477€ - 1 restaurant per month with friends: 50€ - 1 movie ticket per month: 15€ - 1 coffee, 2 times per week: 28€ - 1 drink with friends, 1 time weekly: 40€
- Total, remaining: 294€
- Daily wage: 9.40€
Just to give you an idea of what it means living with 9.40€/day in Switzerland:
- Train from Geneva to Lausanne (30 minutes): 35€
- Coffee at Starbucks: 7€
- Big mac meal at McDonald's: 10.50€
- A coffee: 3.50€
Basically speaking, this wage would grant you the real minimal amount required to pay your rent, your most basic insurance, income taxes, have a minimal social life with people (coffees) and get some very basic food at home (rice, milk, bread, etc.).
Forget the idea of buying anything else such as a kitchen appliance, furniture, clothing, books, side-education, holidays, etc.
So yes, it sounds like a very high amount to other countries ears but here, it's lower than the minimal wage. This is a wage to make let people actually "think" by removing the struggle of finding food and shelter. But it is in absolute no way enough to satisfy a normal and well-being person's needs. Finding a job remains necessary.
I would think some sort of controls on the prices, possibly only on things the basic income is expected to pa(rent, insurance, food, etc...) would be needed to prevent a runaway inflation feedback loop. Maybe that would be enough to prevent runaway inflation?
I like the idea of it but proper implementation would be very difficult.
I'd probably be in the camp of someone who would try for a riskier job, art, entertainment or game design if this was a thing. To be honest, it would probably add more value to the world than what I'm currently doing.
I still don't think it would affect most people though; I'd say the majority of people think I'm a bit odd, even some of my friends.
"Just because an initiative - such as a basic income - gathers enough signatures to trigger a popular referendum in Switzerland, it doesn't mean it will be passed (indeed the national minimum wage initiative was similar - and was heavily defeated). So far it is firmly opposed by the Swiss Federal Government:"
That said, it would be interesting to see how basic income might affect entrepreneurship in the US. Entrepreneurs might not have to move to high cost cities like San Francisco and maybe this would encourage more remote work.
The only way this works is if people with productive jobs end up with less money than today.
There are a lot of tax breaks that are designed to reduce the tax burden of the middle class -- things like mortgage interest deductions -- that could be eliminated in a "Basic Income" setting.
Art. 110a Unconditional basic income
1. The Confederation shall ensure the establishment of an unconditional basic income.
2. The basic income should allow the entire population to lead a dignified life and to participate in public life.
3. The law particularly regulates the financing and the amount of the basic income.
The parliament and the senate recommend to vote against this.
Source in french: https://www.admin.ch/opc/fr/federal-gazette/2015/8727.pdf
The government would then have to implement this.
That's 2,256 EUR or 2,443 USD.
For those lucky enough to have managed to secure a place without rent/mortage -> essentially those lucky few with ownership <- will get the best out of basic income.
Let's say I buy a house in the US and pay cash (no mortgage, no financing). I now own this house and decide to live in it. I will have to pay local property taxes, but I do not have to pay any income tax.
Now, let's say I instead rented out the house to someone else (and lived somewhere else), I would be making income on the rent, and therefore paying income tax on the rental income.
In Switzerland, if you live in the house that you own (the first example), you are considered to be renting it to yourself. So you have to pay income tax on the market rent for your home, even if you are both the tenant and the landlord.
EDIT: For the record, I don't know why you're being downvoted for asking for clarification.
Meaning it's essentially for rich kids who've inherited their own housing, or those with enough dispensable income to pay off their place. Basic Income in this scenario wouldn't help the poorest, it would help the rich enough to get further with that money.
I am not against Basic Income, but it has to be in a situation where the poor will benefit from it, not the rich enough to make the best out of the money. This seems like just another shit the modern bourgeois leftist have cooked up for themselves thinking it applies to the poorest. What a joke.
If a given person could not afford a mortgage or a down payment, adding more money to that persons income increases the chance they will save enough to do so, not reduces it.
Switzerland is also interesting in that they tax total wealth, so the more assets you have, the more you pay: https://en.m.wikipedia.org/wiki/Taxation_in_Switzerland#Prop...
If you're concerned about possible unfairness of minimum income then you would need to look at people whose medical expenses could exceed the minimum income, people who are mentally incapable of buying the right resources, people who have dependent children and unchecked market forces that would allow prices to rise beyond what the minimum income could afford.
The last one is the biggest problem as it would effectively transfer wealth from taxpayers briefly through the poorest people to the wealthy via increased profits and still leave some people unprovided for.
2000.- isn't poverty level and more than wellfare would pay - but not much more.
I do not consider myself poor, but there's no way I can afford any sort of holiday in switzerland.
I have friends and some colleagues in switzerland: for them, a year's rent of my house would equal for roughly a single month of their salary. For those living close to Geneve, sometimes less.
It's mind-blowing, really.
In the beginning I always had the feeling of something wrong when going to a supermarket there, because for me the gap was so crazily big.
So 2250 dollars in Switzerland roughly gets you the same purchase power as 1400 in the USA.
Switzerland is expensive but not THAT expensive.
Either way, I'm not gonna go ahead and proclaim it's a good idea or not, but I think it's a valid idea that demands thought, and experimentation.
I hope Switzerland has the capacity to both pass this law, and retract it if it doesn't pan out as expected.
I asked one of the taxi drivers what a cashier makes and he said $80k. With prices that high, It almost feels like a house of cards. I dont understand why exchange rates dont drastically bring these prices into alignment. Seems like importing goods from other countries would completely destroy this ecosystem.
It absolutely does make sense to import high-end high value add products which reduce labor, if you're in an artificially high labor cost environment.
"The median wage in the Swiss private sector was 6,118 francs [~$6k] last year. A gas station shop worker in Lucerne is paid 3,570 francs a month"
http://www.bloomberg.com/news/articles/2014-05-18/swiss-reje...
What would that do to the Swiss tax system if people left Switzerland and started paying most of their tax in other countries?
That said, I like the idea of basic income. I just think that the laws around it should be designed very carefully.
What happens if a recession hits and there's 25% unemployment What happens if 25% of the people really decide to stay home and not work? What if unemployment is only 10% but the other 90% become less productive?
Yes, capitalism and "every man for himself" has it's own drawbacks but the positives outweigh the negatives.
Before that, there is the usual lobbying by different political parties and it depends on the perceived gravitiy of the changes how much you see. There are billboards, discussions in radio, TV and newspapers. Sometimes there are also other groups coming into the public light as happening now eg. with law professors campaigning against the 'Durchsetzungsinitiative' (the discussion about that one is getting more and more heated).
The exact amount of the income is unknown and not part of the Law and any press article is basically reporting based on speculations.
The source of the income is also not part of the initiative. It is the Government's duty to find a way to finance it once the Swiss citizens have decided there should be one.
There are two major suspected targets for collecting the necessary money. First source would be the VAT, through an increase of the current VAT. It is currently set at 8% and it's among the lowest in the world (the Swiss public administration workers are very efficient and working in a public office is not typically the kind of job given to people with personal issues as in many other countries).
The second potential source is a taxation on trading operations. Even the slightest taxation rate on trading operations (aka 0.00001% capped at 0.01$) would immediately solve the issue of funding the revenue.
Similarly arithmetically impossible claims were made by European politicians arguing for an FTT two years ago - claiming they would raise 100s of billions from an industry (HFT) which only generates 5 billion or so profits a year - worldwide.
In other circumstances this could be classified as a mental disorder.
Who will actually get to vote and when?
How does this not create some form of inflationary influence?
If you shift consumtion from some luxery goods to more low end goods there might be a slight increase in the price of some of the lower end goods but because of the price elasticity it will only be a very small amount.
The avg price level should remain about the same, some relativ price would be effected but not to any overly large degree.
We have to remember that this is not a overly radical proposal most people will still have about the same amount that they have now. Some people on the lower end will somewhat increase their income but not enougth to change prices significantly.
I'm looking at it from the point of view of a landlord / property manager (something I am not). If this law was enacted, I could most positively think that I could raise rents a fair amount knowing that so many more people could now afford my property.
I could also assume the market would get flooded with new renters (demand up), driving prices up.
I don't see how that wouldn't happen in other markets too.
The Swiss have referendums all the time and most, especially liberal ones like this, fail.