solution

Micro Credits – A Solution For Poverty?

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By Viktor Persson

After the Norwegian Nobel prize committee decided to give the United States president Barack Obama the peace price, a president that later came to continue to war in Iraq, and also fund insurgents in Syria, I seriously started to doubt the reasoning skills of the members of this Nobel Prize committee. And after having watched the documentary ‘The Micro Debt’ by Tom Heinemann, I have concluded that the Nobel Prize committee (at least those handing out the peace prize) do not know anything about what it means to create actual peace in this world. Because when they decided to give Muhammad Yunus the peace price, for having founded the Grameen Bank, and invented the concept of micro loans, and for thereby apparently having found a solution to poverty, they were obviously not using basic mathematics to assess the outflows of such loan methods.

YunusThough, before we dive into the basic mathematics of Micro Debt and whether this can be a solution for poverty or not, let me share the story of Muhammad Yunus, his bank, and the stories that has begun to surface about his money lending practices. It begins in 1976 when Yunus (supposedly) found out that small loans could make a disproportionate difference in a poor person’s life. According to Wikipedia, the first loans Yunus gave, made it possible for the borrowers to profit. Yunus business expanded, and by July 2007, his bank had issued around US$6.38 billion to 7.4 million borrowers.

As mentioned above, Yunus was awarded the peace price in 2006 for his efforts to create economic and social development. However after the release of the documentary ‘The Micro Debt’ the Bangladeshi government decided to review Yunus bank, and Yunus himself was removed as Managing Director of his bank. This is not particularly strange considering the claims that are made in the documentary, and the compelling evidence that it presents, that the micro debt is not at all a solution for poverty, but rather a trap, making the large amount of borrowers worse off than before.

Though in this blog I am not going to focus on Yunus and whether the claims made against him are true or not. My focus will instead be the concept of micro credits and whether these loans makes any sense; is it really possible to remove poverty through debt? The Micro Credit concept is not unique to Bangladesh; it has also become popular in South Africa, where it has created the opposite of poverty reduction. The following quote gives a stark description of the situation that unfolded.

”The microcredit-induced problems that emerged in South Africa are two-fold. First, microcredit per se is actually an “anti-developmental” intervention. For one thing, it exists on paper to support the smallest income-generating activities, but in practice is increasingly all about supporting consumption spending. In South Africa, the microcredit movement has created an incredibly risky and expensive way to support the immediate consumption needs of the very poorest.

With few poor individuals possessing a secure income stream that might ensure full repayment of a microloan – unemployment is now higher than it was under apartheid – many of the poorest individuals have been forced to repay their microloan by selling off their household assets, borrowing from friends and family, as well as simply taking out new microloans to repay old ones. For far too many now “financially included” individuals in South Africa, using microcredit to support current spending has been a disastrous and irreversible pathway into chronic poverty.”

Milford Bateman, Microcredit has been a disaster for the poorest in South Africa, http://www.theguardian.com/global-development-professionals-network/2013/nov/19/microcredit-south-africa-loans-disaster (2015-09-25)

 

Euros - MicrocreditAcademics and other proponents of the Micro Credit as a way out of poverty makes the assumption that the money lent will be used by the borrower to further his business. This however, is just that, an assumption. Most poor people are just as middle class people, not entrepreneurs, and do not have a very entrepreneurial relationship with money. The loan will be used to buy goods for immediate consumption, and will only serve to put more pressure on the debtor. In worst-case scenario, this will lead the already poor person, to loose the little safety they do have, when they are forced to sell their house to meet interest and installment payments.

Further, those borrowers that are indeed entrepreneurs, and that do invest their money in a business, there is nothing that says that these businesses will be able to profit. Nine out of ten startups fail – and that number will probably be even higher when not only you, but also all of your neighbors, decide to go out on the streets and sell the same thing – which did happen in South Africa.

Then we have the big problem when it comes to Micro Credits, the interest rates. On some of the Micro Loans that interest rate will be at 100 % or more. There is no startup that yields a sufficient profit to cover such a high interest rate. Conveniently for the creditors, most of the debtors are not proficiently literate, and will thus not really understand what they are signing.

Yunus was applauded when he was able to offer loans to poor people that cannot offer any securities in case they would forfeit on their installments. However, to ensure repayment of the loans, Yunus bank have developed a system of “solidarity groups”. It is these small informal groups that together apply for loans and its members act as co-guarantors of repayment and support one another’s efforts at economic self-advancement. Hence Yunus use the psychology of group pressure to ensure that the poor people are sufficiently motivated to pay back their loans. And even though this might seem innocent, in reality it has lead to the most horrific of consequences. One woman that was unable to pay her loan was pressed by her co-guarantors to take up prostitution as a way to meet her installment payment. That woman later poured kerosene on herself, and lit herself on fire. That is the effectiveness of group pressure when survival is in the picture.

What are we then able to conclude from all of this? One thing is clear: We cannot trust academics to know what is right! Even though they have a degree in economics, and even though they have received the Nobel peace price, that does not mean they actually understand how reality operates. Academics have their nose buried in deep books and because of that they will many times miss what is right before their eyes. Hence, we have to educate ourselves, and take responsibility. We cannot rely on a small intellectual elite to know how to solve such things as poverty – this is a problem that involves, and touches all of us, and accordingly it is everyone’s responsibility.

Then, the second thing we can learn: Change cannot come through DEBT. The very reason why we are living in a world where money is increasingly more difficult to obtain is because of DEBT. We live in a debt based system, and this forces us to work more – and even still there will/must be a loser. With debt, someone always loses; someone must be that poor guy that has to pay back the interest.

Real change will come through changing the structural design of the economic system – because only through changing the rules of the game are we removing this incessant fear of survival that is currently holding the entire human race in its grip. That structural change must involve giving all human beings a dignified life, real security, real safety, and easy access to money. This cannot come from debt, as debt is the very instigator of fear, anxiety and stress.

Hence, if you are interested in solving poverty, I suggest that you investigate the Living Income Guaranteed. This is an economical system that will revolutionize the way we think about money – and that is precisely what we need. We need something new, a brand new way of looking at things – a fresh start – free from debt and the old pessimistic ideas that apparently, poverty is unable to be removed from the face of this earth.

 

For more reading:

http://www.marlenvargasdelrazo.com/the-micro-debt-the-nefarious-business-on-poverty/#

http://www.theguardian.com/global-development-professionals-network/2013/nov/19/microcredit-south-africa-loans-disaster

 

Watch the documentary ‘The Micro Debt’

https://www.youtube.com/watch?t=791&v=yoAGKFaqwjM

https://www.youtube.com/watch?v=M6KHa4omGG8

https://www.youtube.com/watch?v=FdmXLpjykNk

https://www.youtube.com/watch?v=ncBXy_AvNUY

 

Investigate the Living Income Guaranteed Proposal

A Permanent Solution for the Neglected Produce Laborers of Mexico

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by Fidelis Spies 

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Problem:

A Times reporter and photographer find that thousands of laborers at Mexico’s mega-farms endure harsh conditions and exploitation while supplying produce for American consumers.

The Times found:

  • Many farm laborers are essentially trapped for months at a time in rat-infested camps, often without beds and sometimes without functioning toilets or a reliable water supply.
  • Some camp bosses illegally withhold wages to prevent workers from leaving during peak harvest periods.
  • Laborers often go deep in debt paying inflated prices for necessities at company stores. Some are reduced to scavenging for food when their credit is cut off. It’s common for laborers to head home penniless at the end of a harvest.
  • Those who seek to escape their debts and miserable living conditions have to contend with guards, barbed-wire fences and sometimes threats of violence from camp supervisors.
  • Major U.S. companies have done little to enforce social responsibility guidelines that call for basic worker protections such as clean housing and fair pay practices.

Hardship on Mexico’s farms, a bounty for U.S. tables

By RICHARD MAROSI http://graphics.latimes.com/product-of-mexico-camps/

Where does our food come from? It is the fruits and veggies of other people’s labor. Farm exports to the U.S. from Mexico have tripled to $7.6 billion in the last decade, enriching agribusinesses, distributors and retailers. As you can see in the article it’s the actual labors that come out last.

The company utilizes advance growing techniques and very carefully employs sanitary measures to make sure their produce is safe and good quality, but at the same time they absolutely neglect the workforce. The produce has a higher value than the actual humans working there. One of these Companies actually recently took out full-page newspaper ads promoting its commitment to social responsibility.

The company these laborers work for use devious ways to keep profits high. It is law to pay workers their wages on a weekly base. To ensure that the people do not leave before their 3 month work contract the company often withholds their wages and only pays them at the end of their contract. In that time the workers get their food from the company store with its inflated prices. They often go deep in debt and at the end of their contract some go home without any money.

The conditions are so bad, yet people still go there to work knowing that they might not make money – some go just to stay fed. They go because they simply have no alternative and that is what the companies are exploiting. Is there any way to stop this Madness? Yes

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Solution:

The main reason why people will work for a company like this and live with the miserable living conditions is because they need the money – no matter how little it is. So let’s see how the Living Income Guaranteed will drastically improve the situation:

With the Living Income Guaranteed the workforce will no longer be able to be exploited, because that desperation to find a job no matter where it is or how terrible the work conditions are will no longer exist. When the people who cannot find work receive a Living Income they will no longer accept bad working conditions. The company will have to improve the working conditions otherwise they are going to have a hard time hiring the workforce needed to get the job done.

This Involves granting them good quality foods that they are used to eating, to create proper housing with full services for them – water, toilets – and proper working gear. Also what would need to be done is abolish all abuse – this means no threats and not deliberately creating debt for the workforce.  These companies will need to apply and live by their corporate social responsibility measures; currently it’s only a front to make the companies look good.

With the basic Income Double the Living Income the laborers will be able to make a guaranteed decent living that will be paid on a weekly basis, no excuses allowed.

A Living Income Guaranteed will provide effective and practical solutions to all the current problems these laborers are facing and it is something this world needs – a Solution.

 

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Investigate the Living Income Guaranteed Proposal

How the Living Income Guaranteed Will promote Environmental Sustainability

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by Fidelis Spies

Environmental Healing with LIGAs we all know, our continued human existence is having consequences on the Earth and one of them is the Earth warming up. And so scientists are trying to come up with solutions to stop this particular consequence and one of the options to stop Global warming is through GEOengineering – interfering with nature on a planetary scale.

Here are some of the GEOengineering options that scientist are currently investigating:

1. Afforestation: This technique would irrigate deserts, such as those in Australia and North Africa, to plant millions of trees that could absorb carbon dioxide; this vegetation would also draw in sunlight that the deserts currently reflect back into space, and so contribute to global warming.

2. Artificial ocean upwelling: Engineers would use long pipes to pump cold, nutrient-rich water upward to cool ocean-surface waters. If this process ever stopped it could cause oceans to rebalance their heat levels and rapidly change the climate.

3. Ocean alkalinisation: This involves heaping lime into the ocean to chemically increase the absorption of carbon dioxide.

4. Ocean iron fertilisation: The method involves dumping iron into the oceans to improve the growth of photosynthetic organisms that can absorb carbon dioxide.

5. Solar radiation management: This would reduce the amount of sunlight Earth receives, by shooting reflective sulphate-based aerosols into the atmosphere.

As I read through this list I get kind of worried, because they are trying to stop the Earth from heating up through wanting to do things like dumping iron into the oceans or spraying the air with sulphate. Won’t that simply cause more problems in the future? You don’t solve a problem with another problem.

Here is an analogy: You see a spider trapped in your bathtub. So you take a few sheets of tissue paper and very carefully burn your house down…

In a similar way that is how we deal with issues we face on this Earth. With the above mentioned solutions we are simply going to create more problems.

Earth Tool ChangeThe way you deal with problems is stopping them at the source, which is the way we humans interact with the Earth – or more specifically: how we have come to value profit over things that actually matter – like the Earth itself. Our world leaders have for some time had those meetings on finding solutions to cut carbon emissions, but not many are actually doing that. The reason comes back to money, a factory pollutes the Earth, but it also makes money. Currently cutting emissions equals less money made.

Eco friendly solutions cost a lot of money, so that is why it is not ever really implemented on global scale – it’s not cost effective. Also, there is the factor that there is a massive profit being made by current use of available technologies – like oil and coal – and thus coming up with other solutions is discouraged.

So then what is the reason for all this pollution currently created? Money. And what would be the solution to clean up and stop pollution? Money. The planet has over 7 billion people on it. And I have read and seen solutions to control and get rid of pollution many times, but it never gets implemented, because the people coming up with these ideas do not have the necessary funds to implement these ideas or do more research. And in many of these cases the people who come up with these ideas are those directly affected by the pollution.

With the implementation of Living Income Guaranteed we could ensure that all options are considered and see what will be the best solution. Not to say that LIG would be bad news to businesses around the world and force them to cut carbon emissions – no – rather more about focusing on ways to prevent this with the use of new technologies that are available and that are currently not being used because profit is placed over sustainability, which is how through Corporate Social Responsibility measures, corporations will also have to consider their own sustainability and assurance of production by stopping degrading measures that will cause more consequences for them and the community.

Also what is happening is that consumers are becoming aware of the consequences that factories have on the environment and are favoring eco-friendly production methods. So the company will have to start introducing environmentally friendly solutions and stick to the new trend to meet the customer demand in order to still make money.

Another point is that when an individual doesn’t have to worry about surviving and can start focusing on actual living – it opens doors and with it great potential. For example there are so many people who find passion in doing humanitarian work, or finding solutions to make factories more efficient and less polluting – but cannot focus on doing any of that, because they need money to survive. Who knows what potential we can unlock and ideas we can come up with and implement to reduce or even reverse the negative consequences we have created on this Earth. The Living Income Guaranteed would bring us closer to finding the solutions we require.

Here are Videos that further explain how with the Implementation of the Living Income Guaranteed will promote Environmental Sustainability and Corporate Social Responsibility:

 

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Check Out the Links for More Information on the Living Income Guaranteed

Living On Stolen Money – Decision or Consequence?

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By Viktor Person

Crimes Criminality LIG Living IncomeA life of crime is two-part documentary (I’ve posted embeds of the videos in the bottom of the post), where a filmmaker follows some criminals during two periods in their lifetime. The first time he meets them they are in their late twenties and still quite strong and vigorous, and they are sustaining themselves through shoplifting. In part two he meets them when they are in their middle thirties and life has begun to take a toll on them.

What is so interesting about this documentary is that it reveals the mindset of the criminals, the WHY of their decision to become criminals. Several times throughout the documentary they exclaim that they are able to make much more money through stealing than through having a regular job. Working one day as a shoplifter makes them around 3000 dollars, while working one day at McDonald’s makes them about 80 dollars. Thus, what is clear is that these people are not driven by some form of bad moral, or psychopathic desire to cause harm to others. No – in-fact these shoplifters are economist’s showing to us what kind of consequences our current economic system create.

It’s obvious that thieves, shoplifters and burglars are not an incident or mishap, they are consequence, they are not an anomaly, they are a predictable outcome – the result of an equation. For those of us that have led a life of money, it’s hard to relate to and understand what goes through a person’s mind when he or she decides to become professional shoplifter, because most of us born in economically stable environments would perceive it as immoral, wrong and barbarian. However, for someone born at the very low end of the hierarchy theft and a criminal life is a way of escaping a permanent sentence to a life poverty, and hard work.

Economists would probably agree with me, because it’s simple mathematics, when there is no support for those at the bottom, no hope for a better life, no ability to rise and build a life for oneself, then crime is a way out = supply and demand = cause and effect = problem and consequence.

Thus, realize, when crime rise, it’s not something bad, it’s actually an indication that something is very, very wrong with society, and that there are some drastic changes required. Realize that when prisons are filled to the brim with people, then we have a sick society, and that sickness can be traced back to the unequal distribution of money and resources.

This is where we require embracing a paradigm shift, because in order to make our lives better, our society more safe, our life experiences more rewarding, we must learn to give – we must learn to give, as we’d like to receive. Most of us have extremely difficult to grasp this concept, and when confronted with it, we shiver and turn inside, immediately out of our mouths comes the statements that “it’s unfair!” – “they should work for their money!” – “we can’t change that!” – “there will always be crime!” – but see, this is not common sense, this is assumptions, ideas, projections, and in actuality useless opinions that have no significance in terms of how reality actually works.

The fact is that, when we make the decision to give all an equal opportunity to make something worthwhile of themselves in this world, we are doing ourselves a significant favor. We will in doing that release so much pressure, fear, and society will become a completely different place, where crime will be significantly less.

One of the solutions we’re able to implement is a minimum wage, and not just any minimum wage, but a big minimum wage with which one can buy luxurious items, start a family and make one’s life comfortable and enjoyable. Manual labor such as working for McDonald’s, or similar, shouldn’t be awarded with a salary that merely puts one on the breadline. Instead dedicating oneself to contributing to society should be awarded amply; it should be more profitable to live honestly than to make living as a criminal.

So, the key to designing a successful society is to ask us the question WHY? Because everything that happens in this world does so for a reason – our physical reality is filled with equations and these in turn produce various results, and through changing the variables, we’ll change the result.

Investigate the Living Income Guaranteed and allow yourself to step up and become a social engineer, question the movement of your daily life, what happens, why it happens, and how it could be changed in such a way that all are included. Because it’s clear that – there are SOLUTIONS – we must simply be brave enough to see and apply them.


 

 

For Further Information, Follow these Links:

The Self-Perpetuating Cycle of Homelessness and Living Income Guaranteed

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The following article lays out the account of one mother’s ‘bad luck’ after the other: Homeless Mother Gets Job Interview But Doesn’t Have Childcare, Ends Up In Jail

She is a mother of two, homeless, unemployed and finds herself having a chance for a job. Not having a home, she cannot leave her children at home while she attends the job interview. Not having money, she is unable to afford childcare while she attends the job interview. So she does the only thing she can do in her situation: leave the children in the car with the window cracked open while she attends the job interview.

Taylor was charged with two felony counts of child abuse for leaving her six-month-old and two-year-old in a car with the windows cracked last Thursday for at least 45 minutes as she sat in an interview for a potential job. She told officers that she was homeless, so she couldn’t leave her children in the house, and she had no one else to watch them.”

Yes, what she did was dangerous, creating conditions which could have led to a fatal outcome. But like the article states: “Taylor’s story raises an important issue: People in her situation are left with only bad options. “Just as she set up the conditions for possible harm for her children by leaving them in the car, so is the system and society guilty as a whole for creating the conditions in which people’s hands are forced to make ‘bad decision’ and forced to choose between lesser evils.

Once landed in a bad position, it can be hard to move out if it, as one’s dysfunctional reality is set up to maintain itself as just that: dysfunctional.

Homeless people also struggle with more than child care when looking for work — they can have difficulty finding an internet connection to apply to job or transportation to get to interviews, clean clothes, or a place to put their belongings. And once they land a job offer, they can run into even more problems, especially if they don’t have things like an ID or birth certificate. It’s a vicious cycle; not having a job perpetuates homelessness, which can in turn make it even harder to find a job.”

break the cycle

What this story tells us, is that in how we are currently running our society and economic lives – you need money in order to make money. If you do not have money to clothe yourself, feed yourself, take care of basic hygiene, have a roof over your head; then it is very unlikely that you will be able to move into a position that will enable you to attain a dignified living standard. It’s kind of a Catch-22 in the land of the economically underprivileged.

How do we break this self-perpetuating cycle? With a Living Income Guaranteed of course.

If this woman would have had a Living Income disposable to herself, she would a) have had the option to stay at home and take care of her kids or b) pay for child care to give her the time and space to get employment.Not only is a Living Income Guaranteed instrumental to ending homelessness, a manifestation which puts to question our solidarity and should really have been eradicated already ages ago; it is also a cost-saver.

“It is cheaper to give homeless people a home than it is to leave them on the streets.That’s not just the opinion of advocates working to end homelessness, nor is it the opinion of homeless people themselves. It is a fact that has been borne out by studies across the country, from Florida to Colorado and beyond.The latest analysis to back up this fact comes out of Charlotte, where researchers from the University of North Carolina Charlotte examined a recently constructed apartment complex that was oriented towards homeless people.Moore Place opened in 2012 with 85 units. Each resident is required to contribute 30 percent of his or her income, which includes any benefits like disability, veterans, or Social Security, toward rent. The rest of the housing costs, which total approximately $14,000 per person annually, are covered by a mix of local and federal government grants, as well as private donors.In the first year alone, researchers found that Moore Place saved taxpayers $1.8 million. These savings comes from improvements in two primary areas: health care and incarceration.”
From: It Saves Millions To Simply Give Homeless People A Place To Live

Both humanitarian and economic motives for a better world, come together within a Living Income Guaranteed. We can reduce social misery, improve human dignity and security and boost the economy – all in the same package. We’d be crazy not to.

Investigate the Living Income Guaranteed Proposal and Join us for discussion.

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What is the Living Income Guaranteed?

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Living Income Guaranteed is an economic and political mechanism to ensure the establishment of Fundamental Human Birth Rights of the public through allocating an allowance on a monthly basis to every eligible individual that is currently in a position of being unable to sustain themselves – and/or people in their custody – financially to a level that Human Dignity deserves and that currently lack such support due to reasons beyond their immediate control including – but not limited to – unemployment, lacking access to food, lacking access to housing, lacking access to healthcare, lacking access to education, physical disability, being retired or not old enough to have a job.

This is within the understanding that the existence of poverty and lack of education as the key to have a job and means to live is the result and outflow of the economic system’s malfunction, providing an unfair allocation of National Natural Resources, being unable to support every living individual with sufficient access to fundamental living necessities. The most immediate remedy is to eradicate poverty, through allocating/designating a monthly allowance to those that don’t have access to their fundamental living necessities, thereby empowering them to establish a dignified life, enabling each one to reach their potential, choose a career and contribute to the economy through their skill, labour and purchasing power.

Why is it called Living Income instead of Basic Income?

It is called ‘Living Income’ because it won’t only provide each one with the minimum required to survive, it implies sufficient allowance that is able to cover the fundamental expenses required for a dignified living Why? Because this will enable people to reach their creative potential, return to the job market, become independent from the Living Income and contribute to the progression of the economy.

This means that a Living Income Guaranteed should be provided to all individuals that are currently unable to participate in any economic activity due to the lack of jobs/education/health. However those that don’t participate in any economic activity but do have sufficient money to live due to, for example, family wealth, inheritance or any other regular income won’t qualify nor require the Living Income Guaranteed.

Why is Living Income Guaranteed Not Unconditional?

The reason why it is not given to all people unconditionally is because this would undermine the sustainability of an economic system that does require people to be motivated to educate themselves and work to enable the continuation and functionality of our societies.

That means that people that work won’t get the Living Income Guaranteed?

That’s right, however we Do propose that the Minimum Wage is Doubled (twice the Living Income Allowance), which means that there will be a series of reforms to take place first to make the Living Income Guaranteed a sufficient Allowance granted to cover fundamental living necessities, which is within the context of our current economy More than our current Minimum Wage standards.

This allowance should be sufficient for an individual to have dignified living conditions with guaranteed access to their fundamental human birth rights: Food, Water, Housing, Healthcare, Education, Clothing, Transportation, Public Services, etc.

Now to motivate people to work, the new minimum wage should be Double the Living Income Guaranteed in the most common economic activities which are at the moment associated with retail workers, waiters, cashiers, transportation workers, fast food industries, etc..

So, anyone that genuinely wants to have a top quality lifestyle will not conform to only getting the minimum as the Living Income, but continue educating themselves, developing further skills to make more money and have more financial solvency.

What’s in it for the corporations with implementing the Living Income Guaranteed model?

A broader consumer base. Those that previously had no money to live and as such were not economically active will suddenly become active participants in the economy which will ensure that profit is also broadened for corporations, realizing that if more buyers emerge, there will be more profit that can be used to better the working conditions, to diminish the compulsive production and instead adapt the prices to make things affordable, with great quality and providing a secure and harmonious working base, as well as proceeding to fund the automation of jobs that are currently deteriorating human health.

Workers will feel supported and cared for by their employers, which will result in individuals that no longer feel pressured and enforced to only be a profit-making machine, but will feel happy and content to realize that their work is being truly remunerated and that their time and contribution to the corporation is being valued as the life-time investment it actually is. A well remunerated individual will create a happier and fulfilled society that is no longer afraid of not having sufficient money to feed their family, it will be the beginning of a new era of quality work that dignifies the lives of human beings that genuinely desire to improve their lifestyles.

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Why is the implementation of a Living Income Guaranteed an immediate solution to the economic crisis?

More than a solution to a crisis, it should be understood as the way to guarantee that the Fundamental Human Rights to each individual are properly funded through allocating an Allowance as the access to the necessary things one requires to live in a dignified way – this is within the principle of Giving to others what we would like to receive, and if we want to live in a peaceful society, to have a happy and healthy living condition, we then must give access to this Allowance/Income as a living certainty that will eradicate the need to resort to crime, panhandling, homelessness, lacking education, health care that results in economical regression affecting every individual in society.

It is common sense that if we give an Allowance to every eligible individual to be well nourished, have proper living conditions with the fundamental necessary services, health care and leisure time, more educated beings will emerge from this when realizing that if one is given support as in getting an income to cover one’s living necessities, one learns how to give back to society too. This will be understood as a living principle that applies to every living being on Earth beyond any political, social, religious or ideological affiliation. We’re talking about physical living necessities that all human beings require to live in a dignified and sustainable way.

On top of this, many jobs are being replaced by the rise of the machine, which will require more restructuring processes in our economy to finally upgrade the premise of being able to ‘make a living by having a job’ because if jobs are currently not available to all – regardless of having college degrees and necessary skills to have one – then it is certain that a new understanding of our economy should be grasped as supportive mechanism for all individuals rather than a restrictive and coercive one.

In the past, long-term policies and treaties have attempted to benefit the working class over time, and it has proven to be inefficient for the tightening policies implemented by corporations as well as the economic outflows have deviated their effectiveness. This is how through a direct intervention to provide the Living Income as an Allowance and doubling of the minimum wage, we are directing the problem at the root, instead of expecting third party actors and policies to solve the situation throughout time.

Will the Living Income Guaranteed undermine competition and as such create economic stagnation in society?

Not at all, actually it’s the other way around. If we define competition as the ability achieve the best living condition in a society, by allocating Allowance to every eligible individual that previously had no access to it, we assure the activation of the economy and impulse people to work if they do want to have a greater economic solvency to cover other consumer desires for extra commodities that are not able to be paid for with the Living Income Guaranteed. Also, there is no limit to how much money you or corporations can make as long as their businesses do not interfere in any way with the nationalization of natural resources or fundamental public services – that is the condition. That means that the rules of a free market still apply and as such, the only constitutional and governmental management will be to supervise the implementation of the Living Income Guaranteed, as well as conducting the usual maintenance, management and provision of public goods and the justice department.

The more you prepare yourself, the better work you’ll have, the more benefits which means you will earn more money as well. Competition means bettering oneself to perform a certain activity the best way one can and this is an essential part of human nature  that has kept our societies remaining competitive, innovative and creative  at a local and global level.

You will also be able to truly have free choice on which work is best for you instead of engaging in working contracts based on need rather than preference or choice. This is the way to implement a real ethical environment at work too, where no more exploitation occurs since any job won’t be the result of a need to work in order to survive, but rather become a means and incentive to increase the quality of life. 

How will it be funded?

Through the nationalization of resources , banks and basic services which means that if, for example, your oil, gas, water, electricity, telecommunications ,transportation is defined as patrimony of the people, the profit that comes from the consumption/purchase of such goods and services should be sufficient to fund the Living Income Guaranteed for eligible individuals. This means there will be no need to have personal taxation but instead keep the VAT (Value Added Tax) as it is to continue funding the functions of the government – this is also within the consideration that as the purchasing power increases and consumer base broadens, the funds coming from VAT will also increase creating more solvency in governmental budget as well, which translates to higher quality public welfare.

Thus with the Living Income Guaranteed there is one thing that is of vital importance: no one in the system, no citizen will pay tax – all tax will be facilitated by either value added tax or sales tax or import duties. If you have a government system that is responsible because you have a system where each one is functioning effectively within the system, you do not need excessive tax; your tax is spent on things like roadwork, transport facilitation – all things that can be handled ‘in house’.

One of the things that can work quite effectively also in a country is to have a toll tax on the roads which are managed by the government and that keeps the roads in place, so according to the use that one has of a road = will be the amount of tax you pay, but there will be in this proposal no income tax, so nobody is going to pay for anyone’s Living Income Guaranteed, it’s coming from the resource companies which everybody in the country are participating in and your sales tax or your value added tax will be according to the amount of your participation within a particular system – this is a fair way of dealing with government tax collection.

This is how the distribution of wealth and profits is expanded onto those that would have no benefit from the commercialization of natural resources and basic services, and due to the constant consumption and requirement of these, it is ensured that the foundation of the Living Income Guaranteed will always remain sustainable and have sufficient funds to cover the beneficiaries’ expenses.

Another example is how through stopping allocating money to fund wars, the trillions of dollars that are spent in the warfare industry can be designated to revitalize the economy through funding the Living Income Guaranteed and supporting the health care, education, commerce, production industries and basic services that require to be improved at home.

Will Public Services also be Nationalized?

Health care, education, water, electricity, telecommunications, media, banks will also be nationalized. Each country will have to assess their available resources in order for the government to make sufficient profit to fund the Living Income Guaranteed.

How can we implement the Living Income Guaranteed?

Through a political proposal, through existing or new political parties that have this mechanism as their key card to gain the majority vote to have our Fundamental Human Rights guaranteed through the Living Income Guaranteed. This means that the right to a Living Income must be granted on a constitutional basis – this is a national-based system constituted at a political level and able to be voted on within a democratic process based on the principle of one man, one vote.

LIG Hong Kong

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