You cannot be free if you do not have to eat.
Last Friday, much appreciated Reader, I participated in a forum about the economic support that citizens of a country or region receive or could receive. The matter is not new and every year it resurfaces due to the revision and fixing of minimum wages, however, this time it gained greater strength due to the economic crisis and the loss of jobs fueled by the pandemic, being perhaps the greatest novelty, that unemployment also affected developed countries. Seeing is believing.
The topic of the mentioned forum was "Guaranteed Income, Basic Income and Minimum Vital Income. From Concept to Application". The event was coordinated and promoted by cardiologist Dr. Manuel Galiñanes, member of the Association "Unidad de Ayuda Ciudadana", based in the city of Barcelona. Speakers were distinguished intellectuals and social leaders of the Catalan community, Diosdado Toledano (Guaranteed Income), Daniel Raventós (Basic Income), Ramón Franquesa (Minimum Vital Income) and Toni Maestre (Portfolio of Minimum Services for all Citizens to 2030). The undersigned, who participated with the presentation "Applicability in Latin American Countries", thanks all of them, on behalf of the nameless, for their valuable contribution and determined struggle in favor of a more egalitarian, fairer and freer society.
Next, I share with you, kind Reader, some of the ideas that I presented in the forum about wage inequality and income or basic income. This purpose would be framed in the context of a welfare economy and the generation of a platform for basic and permanent consumption that mitigates economic crises and promotes business stimulation to produce, innovate and create jobs. Almost nothing.
Right now, the world faces a pandemic that threatens health and the economy. World production has decreased and with it the loss of millions of jobs, the decrease in tax collection and the insufficient reaction of governments to solve both problems. The pandemic has shown, rather than caused, growing income inequality, job insecurity (even in developed countries) and the rampant accumulation of unproductive capital. In a future installment, we will elaborate on the latter. So much stretch the rope ...
The numbers for job losses mentioned change rapidly. I collected a data that mentions that the number of poor has increased by 29 million in Latin America alone due to the pandemic. Obviously, Effective Demand or, in other words, real consumption per person decreases and inequality in society increases. The Gini Coefficient (which fluctuates between zero and one, where zero indicates perfect equity and one total inequality), will help show the magnitude of the differences. The lower the indicator, the greater the existing equality.
Let's see some examples: Denmark, Finland, Sweden and Norway have a Gini coefficient of 0.25. At the other extreme are Mexico with 0.48 (5th place in the world), surpassed by Nigeria, Swaziland, Namibia and South Africa, which exceed 0.50. Inequality rages around the world, it does not distinguish between ideology and development. China is with 0.46.m, Latin America the same, with 0.46 on average, highlighting Brazil with 0.51 and Uruguay with 0.39, as the worst and the best, respectively. (Cecilia Barría, BBC News / Mundo / 25Nov2019).
And Venezuela, apa?
We will talk about that later.
In return, comment on something about the United States, about the long-awaited American dream, which is simply about to turn into a nightmare, although it is difficult to believe. The Gini coefficient for that great country shows a staggering 0.48, extreme poverty spreads throughout the territory, the housing shortage has people living in their cars or in camps, the government withdraws aid from the poor and the process the accumulation of wealth in few hands is accentuated: in 1980 1% of the population held 10% of the national wealth; in 2017, that 1% already amassed 20%. During the same period, in Europe, the concentration went from 10 to 12%. Today, in the American Union, there are more than 40 million homeless, with 8 million more poor whites than blacks. How times change! These data are cause for alarm,
Latin America, perhaps promoted and coordinated by ECLAC (Economic Commission for Latin America), must and can make effective the application of a Guaranteed Basic Income, a thesis that I commented on in an article published the previous week. The central problem to apply it is to determine the source of financing, which does not have to be homogeneous in its concepts or the same in its application, but unique in its purposes and method. For the time being and due to the urgency caused by the pandemic, it can be started with a temporary support bond and, simultaneously, implement a hedge against tax evasion that some researchers, such as Pablo Yanes from ECLAC, estimate at 6% of GDP of all Latin America and the Caribbean, and that is a lot of money. In the same way,
SLITS
Entrepreneurs do not flee from countries where they pay more taxes and public officials do not misuse the national treasury. On the contrary, they live happily in Norway, Denmark, Sweden, ... or not?
"Earn your bread with the sweat of your brow", biblical sentence when there was a lot of work, I guess.
Divide and conquer! Napoleon's phrase if he had also been a businessman.
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