Planet-Wide Citizen's Income: Antidote to Global Apartheid
Myron J. Frankman
myron.frankman@mcgill.ca
Department of Economics
McGill University
October 1997

The fabled global market and its associated set of freedoms is a context where the vast majority of the world's population are limited to vicarious participation and dreams of access that have little hope of realization. The freedom of movement that is demanded and received by the world's investors is not the reality of the world's poor. In the past, the economic safety valve of international migration, while not the preferred option of those who quested for a better life, was more generally available. Today, doors are increasingly shut, except to the world's elites. The poor are confined to a national space where resources may be inadequate even to meet basic needs.

The urge to migrate internationally is but one of a myriad of consequences of our current situation and it is not clear in today's world whether it is still a "solution" to the economic travails of those who migrate. In a period of downsizing of the work force in both public and private enterprises, those still able to immigrate legally may find opportunities limited and encounter a less than enthusiastic welcome. I believe that, together with other contemporary economic and social policy issues, questions of labor compensation, individual entitlements and labor mobility, including international immigration, must be seen as a set of integrated relations extending from the local to the global. The extent of these global interconnections rule out the possibility of politically satisfactory local "solutions". Simply put, a stable integrated global market requires a global safety net. In the words of Philippe van Parijs, one of today's foremost advocates of the introduction of national income guarantee systems, a universal social dividend would provide "real freedom for all." (1) A global citizen's income, supported by a global system of public finance, could free nations from the pursuit of environmentally and socially destructive policies pursued in the name of competitiveness. In my view, the achievement of a world-wide economic system in which people matter requires the shaping of a political system in which people matter, namely the crafting of democratic institutions and practices at all levels from the local to the global. (2)

Dominant Discourse: Market Economics and State Politics

"We had to destroy the world in theory before we could destroy it in practice." That is the judgment pronounced by R.D. Laing on what he calls Galileo's program of casting "experience as such . . . out of the realm of scientific discourse." (3) But the act of deconstructing reality is simultaneously an act of constructing a new reality. The world today is one of rapid globalization-from-above within a context of a guiding ideology of neoliberalism, the opportunistically selective dogma of the powerful to preserve and expand their privilege. That is the world that must now be destroyed in theory, if we are to construct a world that works for all of humanity. To "destroy the world in theory" requires more than providing a definitive critique, as we learned from Thomas Kuhn's The Structure of Scientific Revolutions. If cogent criticisms (there have been thousands) were sufficient, then economic liberalism would have withered long ago. Not only must an alternative conceptual edifice be elaborated, but we must engage ourselves in the laborious process of altering the dominant mindset.

Many of the major principles that form and deform our perceptions of the world today are the same ones examined by Thorstein Veblen in 1919 in his The Vested Interests and The Common Man: the noble eighteenth century principles of equal opportunity, self-determination, and self-help which are to be safeguarded by rights of free contract and security of property may (or may not) have been suitable in the circumstances of the time, but, as Veblen added, "the rule of Live and Let Live now waits on the discretion of the owners of large wealth." (4) One further element is central not only to Veblen's discussion, but also to today's dominant mindset and to any discussion of immigration: "the divine right of nations", which Veblen characterized as "a blurred after-image of the divine rights of kings." (5) These principles represent strong default settings which tend to be consistent with the interests of the powerful, but which are hardly convenient to the well-being of the average person in today's context of a world characterized by concentrated income and wealth and unimpeded trillion dollar per day financial flows beholden to no sovereign.

The dominant discourse emphasizes a market-place magic policy package, while simultaneously regarding national governments as the locus of policy. Market-place magic stresses a one-size fits all approach which is scornful of difference born of politically shaped historical specificities. Market processes are to be permitted to proceed in an unfettered manner, free trade in goods and services is to characterize commercial activity within and between nations, "capital" (monetary and human) is to be allowed free movement internationally and "productivity" is to govern income distribution (more about the last two elements below).

As to the role of national governments: it falls to them to resolve "national" problems either within the limits of maneuver allowed by financial hyper-mobility and/or by market forces in an open economy. The state is no longer viewed as having a role in influencing income distribution other than by enabling markets to function in an unimpeded manner. As employment creation and poverty elimination are seen to be national problems, immigration limitations become the policy of choice to give "evidence" that efforts are being made to assure the full employment of workers recognized as having a "legitimate" claim to continued residence in a country.

Comparative Advantage: Means-Ends Confusion

In the face of steadily concentrating income and wealth, today's introductory textbooks in economics still convey a theory which links income distribution functionally to the marginal contribution to output of homogeneous factors of production (generally labor and capital). Each factor, under assumptions which include perfect competition in all markets, earns its contribution to the product. This theory, known as the marginal productivity theory of income distribution is at the heart of free market thinking: people earn what they contribute to the production process in a context where all markets (for products and factors) equilibrate. That is all there is to be said about income distribution. Neither government, nor community, nor family exist in the basic theoretical model; hence none has a role in distributing income arising from the production process. The leap from theory to practice is not a leap of faith, but an interested leap in the service of those who benefit most in practice from the real world of unequal economic power. (6)

The economic model of comparative advantage which justifies free trade rests on the late 19th century theory of income determination just described and adds an assumption that the factors of production (labor and capital) are immobile internationally. A logical extension of the model by Paul Samuelson in 1948 demonstrated not merely that trade serves as a substitute for factor movement insofar as it diminishes inter-country differences in factor payments, but that trade could equalize the absolute remuneration to labor and capital. (7) In fact, of course, the model's assumptions and reality are essentially non-intersecting sets. Among the many notable "misspecifications" is the fact that capital (in all its senses: financial, management and productive equipment) is highly mobile internationally. A misspecified model would appear to be associated with misspecified outcomes: income differences are not disappearing internationally. The UNDP's Human Development Report 1997 reports that the ratio of the income share of the world's richest 20% to the world's poorest 20% (based on national estimates of income distribution data) has gone from 30:1 in 1960 to 61:1 in 1991 to 78:1 in 1994. (8)

There is a remarkable means-ends confusion associated with the theory of comparative advantage: the desideratum that emerges from that line of scientific inquiry is not that means should be found to equalize income if free trade fails to do so owing to a departure of the underlying assumptions from reality. Instead free trade is to be the chosen means independent of any distributional consequences. If, however, the equalization of compensation is the desideratum and free trade merely one possible mechanism, then it seems reasonable either to search for a more effective mechanism if free trade is not providing the desired outcome or to design an offset to the adverse consequences of free trade. (9) James E. Meade may well have been alone (and virtually unnoticed on this point) among trade theorists when he proposed international income redistribution measures to correct for inequalities arising from free trade. Meade was also virtually alone in expressing a concern for global rather than national well-being. Economic analysis has largely been turned into an exercise in the formulation of national policy, with the impact on foreigners being of little concern as long as retaliatory measures are not provoked. Joan Robinson pointed out that originally neo-classical economic analysis was universalist:

To illustrate Robinson's point, let us invoke the words of George Borjas, one of the major economic contributors to the current debate about immigration into the United States:

Following the 18th century insight of David Hume in his essay "Of the Jealousy of Trade," I suggest that if one drops the word "immigration" from Borjas' statement then an entirely different perspective emerges. Increasing the economic pie in the United States or any other country can best be achieved by creating a system that spreads wealth and citizen's rights as widely as possible. Hume was quite emphatic in his insistence that a country's wealth was closely bound to the advance of wealth in neighboring countries and trading partners. (12) The generalized growth in the "economic pie" -- which increasingly is based on non-material growth in the service sector -- is the best policy and the "best immigration policy". But growth, without redistribution, will simply continue to exacerbate tensions which today surround immigration. The growing "economic pie" associated with globalization must be shared world-wide, if economic push factors leading to emigration are to be mitigated. Citizen's social rights and economic rights must go hand in hand.

Economists, like political scientists, have become realists tied to national policy. Milton Friedman decries the deprivation of freedom of even a few, insisting that "the believer in freedom has never counted noses." (13) Yet, if we seriously believe in freedom, then the two central questions of current immigration policy: "how many immigrants the country should admit, and what kinds of people they should be" (14) would be the object of the most severe condemnation. If we seriously believe in "real freedom for all" then the two central issues become the establishment of open immigration policies combined with the extension of both human rights and a citizen's income that would make remaining in one's own country a viable alternative. Extending our commitment -- central to many religious beliefs -- from national to global social justice through the implementation of disparity reducing transfers of income and provision of services should be given highest priority.

From Global Apartheid . . .

One major consequence of the growing disparities in income is the growing inducement to international migration. Migration is not solely about income differentials, it is also about lifestyle and the human condition. There may be little that can be done to stop the exodus from rural areas until it has largely run its course. As David Hume remarked more than two centuries ago:

International migration is a different matter. Those who leave their country of origin, in a world where national loyalty is still propagated almost everywhere through potent symbols and through the educational system, more often than not do so by virtue of the force of circumstances and often with regret.

It is only by dealing directly with the enormous international disparities in income, life chances and human rights that one can expect to alter the nature of international migratory flows in a non-repressive and non-restrictive manner. By taking direct action to deal with the push factors influencing international migration, we may well be able to bring about the dismantling of barriers and create a world where people will be free to move as they please.

Anthony H. Richmond in his Global Apartheid sees no peaceful alternative to mass migration. In his words: "we must all learn to live with ethnocultural diversity, rapid social change, and mass migration. There is no peaceful alternative." (16) How quickly we can all make this adjustment may depend on our individual economic security. When jobs disappear, when the future seems highly uncertain, then the identifiable "other" becomes the enemy and the social learning that Richmond calls for doesn't occur.

Among the responses to unemployment and slow growth in the industrial countries in recent decades has been the tightening of immigration regulations, changes in definitions of citizenship and rights to residence. Borders have become more permeable to the movement of good, services and capital, at the same time that ability of the common individual to immigrate and even to cross national boundaries is being increasingly circumscribed. The May 1997 Le Monde Diplomatique chronicles the enactment by many French municipalities of prohibitions on the right of residents even to house foreign visitors overnight. (17) Restrictive immigration policy would appear to be simultaneously one of the last bastions of sovereign power and of officially-sanctioned racism (parading under the banner of economic necessity).

. . . To Planetary Consciousness & Responsibility

The 1948 Universal Declaration of Human Rights proclaims the asymmetric right of everyone to leave any country, but not to enter any country other than his own. The only right to freedom of movement that is affirmed therein is limited to the confines of one's own country. However pathbreaking the Universal Declaration may have been, it is nonetheless the work of a past epoch, when voice belonged almost uniquely to national governments and not to the people. And yet it set in motion a continuing process. David Jacobson sees developments since 1948 as nothing short of revolutionary:

As rights loom ever larger, is it not reasonable to be reconceptualizing ourselves as global citizens and not merely "transnational actors"? At what point does a global "constitutional order based on human rights" lead us to challenge the right of states to exclude anyone from either a tourist visit, establishing residence, accepting employment or obtaining citizenship?

In reviewing the expanding perspective on rights, one may wish to focus on the "right to life", the first of the rights invoked in both the US Declaration of Independence of 1776 and in the Universal Declaration of 1948. As Amartya Sen has pointed out in the extreme case of famines, the "right to life" is contingent on entitlements. (19) Indeed, Sen's twin concepts of entitlement and capabilities represent a useful starting point in considering the right to life. Entitlements may help assure survival and may provide the wherewithal to provide the capabilities to develop socially.

In a market economy, entitlement to income is related, inter alia, to property rights, relative bargaining power, market conditions, legal constraints and position within a family. Without property, job or family, one's claim on a share of a community's flow of income may be limited or even nonexistent. And even one's claim to a limited share may be subject to severe restrictions and limitations. In effect, if one doesn't "earn a living", one may not have the "right to live". (20)

As we have noted above, the economists have staked out their claim to center stage in the discourse on distribution of income and product. Against their claim, some philosophers and political theorists are willing to concede that the "right to retain the entire fruits of one's labor . . . [is not] part of a natural right of self-ownership." (21) A far more radical interpretation which starts by rejecting the notion of right of self-ownership was offered in the late eighteenth century by Thomas Paine. In his Agrarian Justice, Paine dissociates in part reward from effort and recognizes as a "right and not a charity" (22) the just claim of all:

In the middle of the 19th century John Stuart Mill spoke of our common inheritance. (24) In a manner similar to that of Paine and building on Mill, Thorstein Veblen referred to our "joint stock of knowledge." (25) To the extent that each of us is a common beneficiary of the cumulative global process of civilization, it is reasonable to argue that all are entitled to some reasonable dividend and that those who reap the greatest gain should not be exempt from charges for the use of what is the common property of all. Whereas Paine invoked the entitlement of all to a "ground rent" for the unimproved value of land, Veblen's logic extended to the lack of any exclusive claim to the wealth springing from our common pool of knowledge.

More recently, in the 1960s and 1970s, the "common heritage of mankind" was used in the discussion of global sharing of the proceeds from the economic exploitation of regions that are not part of the territory of any sovereign state (res nullius). In the mid-1970s we find a suggestion from Jan Tinbergen for an even broader application of the common heritage concept "to new domains such as mineral rights, science and technology, means of production and other sources of wealth." (26) In terms of the present discussion, an important point to note is that an open-ended interpretation of the common heritage of humanity can be invoked to provide philosophical underpinning for the case for a global system of taxation (27) to finance both global income redistribution to universalize concretely the "right to life" and the maintenance of international order.

To the extent that each of us is a common beneficiary of the cumulative global process of civilization, one might argue that all are entitled to some reasonable dividend and those who reap the greatest gain should not be exempt from charges for the use of our "joint stock of knowledge." Moreover, expenditures in support of international order can be thought of as investments in the maintenance and expansion of our global joint stock. Paul Streeten made a similar argument in 1972, suggesting that there is a harmony of interest between the fulfillment of basic needs and the pursuit of sustainable growth:

Conclusion

The human rights agenda remains narrowly defined and incomplete if it is limited to insisting solely on the rights for those who stay home. Globalization-from-below -- globalization for the common individual -- needs to be extended to the right to travel, the right to establish residence, the right to be awarded citizenship without extraordinary barriers and delays and the right to a livelihood.

But the human rights agenda also remains narrowly defined and incomplete if global rights and obligations are not developed. Assuring the "right to life" may be beyond the capability of many national jurisdictions, just as it has long been recognized as being beyond the reach of various sub-national units. Assuring the "right to life" is part of the task of building global social justice. A next step in this direction might be to create global citizenship carrying with it as a start and as a minimum a global system of guaranteed entitlements to income, goods and services which would be supportive of the development of human capability. The next step would be the phasing in a planet-wide citizen income.

I contend that the exclusion and inequality generating effects of free-market globalization-from-above require that a world-wide system of entitlements to services and income (a citizen's guaranteed income or social dividend) be created if our collective commitment to the preservation of human rights, including world-wide freedom of movement in the fullest sense (including the "real freedom" not to migrate), is to be respected and if world peace is to be preserved.

It is only by dealing directly with the enormous international disparities in income, life chances and human rights that one can expect to alter the nature of international migratory flows in a non-repressive and non-restrictive manner. By taking direct action to deal with the push factors influencing international migration, we may well be able to bring about the dismantling of barriers and create a world where people will be free to move (or not) as they please.

Notes (click on Back to return to text)

1. Philippe van Parijs (1995) Real Freedom for All: What (If Anything) Can Justify Capitalism? (Oxford: Clarendon Press). See also the Basic Income European Network (http://www.econ.ucl.ac.be/etes/bien/bien.html).

2. Myron J. Frankman (1997) "No Global War? A Role for Democratic Global Federalism," Journal of World-Systems Research, 3 (no. 2), 321-38. (http://csf.colorado.edu/wsystems/jwsr/vol3/v3n2a4.htm).

3. R.D. Laing as cited in Fritjof Capra (1996) The Web of Life: A New Scientific Understanding of Living Systems (New York: Anchor Books), p. 19.

4. Thorstein Veblen (1919) The Vested Interests and the Common Man (New York: B.W. Huebsch), pp. 158,160.

5. Veblen, p. 123.

6. John Ralston Saul (1995) refers to economic advisors as courtiers and, less charitably, courtesans. The Unconscious Civilization (Concord, ON: Anansi).

7. Paul Samuelson (1948) "International Trade and the Equalisation of Factor Prices," Economic Journal, 58 (June), 163-84.

8. UNDP (1997) Human Development Report 1997 (New York: Oxford University Press), p. 9. See also Lant Pritchett (1997) "Divergence, Big Time," Journal of Economic Perspectives, 11 (Summer), 3-17.

9. James E. Meade (1952) A Geometry of International Trade (London: George Allen & Unwin Ltd.), p. 112.

10. Joan Robinson (1962) Economic Philosophy (Harmondsworth: Penguin Books), p. 117.

11. George Borjas (1996) "The Economics of Immigration," The Atlantic Monthly, 278 (November), 76. (http://www.theatlantic.com/issues/96nov/immigrat/borjas.htm)

12. David Hume (1758) "Of the Jealousy of Trade," in Knud Haakonssen, ed. (1994) David Hume: Political Essays (Cambridge: Cambridge University Press), pp. 150-53.

13. Milton Friedman (1982) Capitalism and Freedom, (Chicago: University of Chicago Press), p. 9.

14. Borjas, p. 74.

15. Hume (1752) "Of Refinement in the Arts," in Haakonssen, p. 107.

16. Anthony H. Richmond (1994) Global Apartheid: Refugees, Racism, and the New World Order , p. 217.

17. Philippe Videlier (1997) "Immigration et conscience citoyenne: L'honneur de désobéir," Le Monde Diplomatique (May), 17.

18. David Jacobson (1996) Rights Across Borders: Immigration and the Decline of Citizenship (Baltimore: Johns Hopkins University Press), pp. 2-3.

19. Amartya Sen (1981) Poverty and Famines: An Essay on Entitlement and Deprivation (Oxford: Oxford University Press) and (1985) Commodities and Capabilities (Amsterdam: North-Holland).

20. R. Buckminster Fuller (1969) Operating Manual for Spaceship Earth (New York: Simon & Schuster), p. 118.

21. Jon Elster (1992) Local Justice: How Institutions Allocate Scarce Goods and Necessary Burdens (New York: Russell Sage Foundation), p. 243.

22. Thomas Paine (1796) Agrarian Justice in Mark Philp, ed. (1995) Thomas Paine: Rights of Man, Common Sense and Other Political Writings (Oxford: Oxford University Press), p. 419.

23. Paine, p. 417.

24. John Stuart Mill (1865) Principles of Political Economy, 5th London ed. (New York: D. Appleton & Co.). vol. I, 278-80.

25. Veblen (1919), pp. 56-59.

26. Jan Tinbergen, coordinator (1976) Reshaping the International Order: A Report to the Club of Rome (New York: E. P. Dutton & Co., Inc., 1976), p. 123.

27. Frankman (1996) "International Taxation: The Trajectory of an Idea from Lorimer to Brandt." World Development 24 (May), 807-20.

28. Paul Streeten, "A New Look at Foreign Aid," Frontiers of Development Studies (New York: John Wiley and Sons), p. 301.