Nixon’s Guaranteed Basic Income Proposal

nixon

Imagine my recent surprise on learning Republican president Richard Nixon, in 1968, was on the verge of enacting an unconditional income for all poor families. It would have guaranteed a family of four $1,600 a year, equivalent to roughly $10,000 in 2016. Here we have yet another historical event that’s been conveniently erased from US history books.

Nixon began by commissioning a study involving a little over 8,500 Americans in cities around the country. Researchers attempted to answer three questions: (1) Would people work significantly less with a guaranteed income? (2) Would the program cost too much? (3) Would it prove politically unfeasible?

Outcomes were surprisingly favorable. Hours of work decreased only slightly and allowed for an increase in other useful activities, such as searching for better jobs or working in the home. Among youth, almost all the reduced work hours were used for education. In New Jersey, the rate of high school graduation for participants rose thirty percent.

Polls showed that 90 percent of US newspapers were enthusiastic about unconditional income for poor families. The Chicago Sun Times called it “A Giant Leap Forward,” the Los Angeles Times “a bold new blueprint.” The National Council of Churches, the labor unions, and even the corporate sector were also all in favor.

In 1970 it seemed that the time for a basic income had well and truly arrived.

With 243 votes for and 155 against, the House of Representative approved President Nixon’s Family Assistance Plan (FAP) on April 16, 1970. Most expected the plan to pass the Senate, too, which was even more progressive than the House. Sadly the Senate killed it.

Writing in Jacobin,Rutger Bregman describes how Nixon adviser Martin Anderson cunningly scuttled Nixon’s guaranteed basic income proposal. A great admirer of libertarian philosopher Ayn Rand, Anderson widely circulated excerpts from sociologist Karl Polanyi’s 1944 book The Great Transformation. The latter describes a historical system similar to Nixon’s proposed basic income: the Speenhamland system enacted in 1795 to alleviate rural poverty in Britain.

In addition to summarizing a Royal Commission Report highlighting Speenhamland’s adverse effects  on both the poor and the community, Polyani cites prominent 19th century economists, such as Thomas Malthus, David Ricardo and Karl Marx, who all roundly condemned the Speenhamland experiment.

It now turns out the Royal Commission Report was based on flawed methodology and essentially fabricated.

Read more about Nixon’s guaranteed income plan, the Royal Commission Report and the devastating impact of dismantling Speenhamland and replacing it with the heinous 1834 Poor Law.

 

The Innate Sloth and Indolence of the Working Class

Invention

The Invention of Capitalism: Classical Political Economy and the Secret History of Primitive Accumulation

By Michael Perelman
Duke University Press (2000)

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The Invention of Capitalism is about the origin of an economic concept known as “primitive accumulation.” Marx defined primitive accumulation as the process by which precapitalist modes of production, such as feudalism and chattel slavery, are transformed into the capitalist mode of production. Using the term somewhat differently, Perelman describes it as the brutal process by which government denies peasants the means of subsistence to force them into wage labor.

Tracing the rise of capitalism in the 18th and 19th century, the Invention of Capitalism also studies the origin of the concept in the work of classical economists, such as Adam Smith, Ricardo and Malthus.

Forcing Workers to Accept Wage Labor

Nearly all the 18th century economists and social philosophers seem to agree that workers never voluntarily accept wage labor so long they have alternative means of providing for themselves. They all acknowledge, either directly or indirectly, that it’s natural for human beings to prefer “self-provisioning,” in which they own or rent a piece of land to produce their own food, clothing, fuel and other necessities. In addition to allowing them more control over their work, there is more leisure time associated with this lifestyle, as well as strong community ties that disappear with wage labor. Unless brutal force must be applied to strip people of the ability to provide for themselves, they never voluntarily agree to wage labor.

In Britain, “primitive accumulation” was largely accomplished through the Enclosure Acts, the Poor Laws and the Game Laws. The Enclosure Acts drove peasants off large tracts of land they had farmed communally for thousands of years; the Poor Laws forced disposed peasants into poorhouses and workhouses; and the Game Acts denied them the right to hunt (ie poach) or gather berries, firewood etc on unoccupied land.

Capitalism developed more slowly in Scotland, France, Italy, Spain and the British colonies, where the ruling elite was less savage in stripping the peasantry of access to land. These regions enjoyed a long transition in which factory workers performed wage labor and self-provisioning simultaneously, by raising crops and chickens and engaging in spinning and other crafts in their leisure time.

The Innate Sloth and Indolence of Workers

As Perelman quite ably demonstrates, most classical economists gloss over the brutal force required to establish a successful capitalist economic system. A few of the lesser known political economists (Perelman focuses in Sir James Steuart, one of Adam Smith’s rivals) are honest about need for laws that prevent workers from self-provisioning. They blame the need for such laws on an innate tendency towards “sloth and indolence” in workers and peasants (and indigenous peoples).

Perelman devotes special attention to the Scottish economist Adam Smith and The Wealth of Nations, as well as the political economists and social philosophers who influenced Smith’s work. He also explores attitudes toward primitive accumulation in the work of Marx, Benjamin Franklin, Lenin and Mao Tse Tung. The forceful primitive accumulation that industrialized the Soviet Union and Communist China occurred much more rapidly than in Western Europe or North America. This makes the Soviet and Chinese process appear much more savage. However a close look at British history suggests they were far more brutal, especially in Ireland and the colonies, than either the Chinese or Soviets.

Yields Drop Under Commercial Agriculture

The part of the book I found most interesting concerns the drop in crop yields that occurred with the shift from labor intensive “spade labor” to commercial agriculture employing horse driven plows and eventually farm machinery. This corresponds closely with modern research showing that plowing reduces yields by destroying soil fertility. Then, as now, it’s clear that the goal of commercial agriculture isn’t to produce more food but to extract more profit from other people’s work.

A Return to Self-Provisioning

Perelman’s research seems especially significant in the face of growing unemployment and part time and casual labor. A growing number of unemployed and part time workers use their enforced leisure time to plant veggie gardens, collect rainwater, preserve their own food and make their own clothes and cleaning and beauty products. In other words, the cycle of primitive accumulation is being reversed, as more and more people leave formal employment and return to self-provisioning.