Obama’s press conference
Though Obama has not called for a guaranteed basic income, he said some things last night that clearly indicate the power and need for this idea:
Our immediate job is to reduce the downward spiral. And that means putting money into consumers’ pockets.
The bill he and Congress are working on, however, would put money only into some pockets. Who gets the money? How? How much? When? Who gets nothing? That’s what Democrats and Republicans are fighting about. Each party wants the money to go to it’s favored causes and constituencies, while denying money to the groups and issues it opposes.
A guaranteed basic income will put money into everyone’s pockets. Every American citizen, equally. No more fighting over it. No one left behind.
Obama also spoke about “restoring market confidence” and “restoring a sense of confidence in the market.” Here, too, the best way to achieve his objective, which just about every pundit and economist shares, is with a guaranteed basic income.
Every citizen will have an income independent of any job. Each of us will be confident that we can afford food and shelter, at least. Even if we lose our jobs, each of us will be confident that we have some income that is stable and certain.
One issue Obama seems to overlook, and another reason he ought to endorse the basic income guarantee, is the abstract nature of “the market.” The term is tricky, in part because there are several kinds of markets. Your neighborhood farmer’s market is very different than the New York Stock Exchange. At the farmer’s market and other local markets, real people provide real goods and services, paying real money.
Financial markets mostly exist in cyberspace only, where computerized trading programs tally bits of data representing securities, debt obligations, credit default swaps, and other such financial instruments. The currency of financial markets is confidence. Bankers and borrowers and investors have to trust one another, or financial markets break down. That’s what happened last summer and fall. Banks stopped lending, especially to one another. Their balance sheets were filled with stuff that couldn’t be sold, couldn’t even be accurately valued in many cases, so there was no basis for trust.
Our government is trying to restore confidence in the financial markets through the $700 billion bailout. That’s a top-down approach, bailing out the banks, buying their toxic assets, assuming that confidence and money will trickle downward and to ordinary people and small businesses. Instead, we could use a basic income to provide funds directly to ordinary people. That will build confidence from the bottom up.
Ordinary people, confident about our financial situations, will save and invest. Many of us will put our money in local banks and invest in local businesses. Money and confidence will flow upward. The financial sector will be rebuilt with a truly secure foundation.
Steven Shafarman
Tags: bank crisis, Barack Obama, economic stimulus
February 10th, 2009 at 9:16 am
Nice writing. You are on my RSS reader now so I can read more from you down the road.
Allen Taylor
March 11th, 2009 at 10:30 am
Thanks. Please help spread the word about these ideas.