A plan coming from the Public Administration of Switzerland involved the creation of a plan to give a guaranteed minimum income to all residents in the country to secure a minimal quality in living standards. The minimum income was about $2,560 to each adult, given monthly, but on a referendum that took place this week, 77 percent of voters said no.
Only 23 percent of the electorate agreed with the implementation of the plan. The mechanism designed to fight poverty and offer a solution to wealth disparities raised controversial debates across the country. Switzerland is the first country that decided to determine whether the plan should be implemented or not trough a direct and democratic process.
Guaranteed income in the world
Some European countries and cities have established similar programs to ensure a basic income to citizens without using referendums as the mechanism of decision. The trend is to implement pilot programs and trial projects to determine whether the mechanism will be applied to larger amounts of people.
For example, in Finland, the program was set to provide the guaranteed minimum income to 10,000 adults, while in Netherlands, authorities have implemented programs in particular cities. The guaranteed income as a project is mostly about the social equality and redistribution of wealth.
Swiss voters set to reject guaranteed basic income initiative by wide margin. https://t.co/bbutOsah0k pic.twitter.com/AZU01YR6NR
— Jim Roberts (@nycjim) June 5, 2016
The Swiss Case
The implementation of this kind of program will inevitably affect the structure of the society, including the economic, legal and cultural system. Swiss opponents to the idea considered that creating a renting program will drag the entire country into a model it can not be controlled. Since left ideology to Marxist economics, some are critical of this mechanism of giving economic support.
One of the central claims is that the program has not been transparent about the financial part of it. In that sense, there is not enough information about how it would be financed the entire plan.
However, the creation of this program is not isolated. The goal is to keep creating an economic model of free market and competition to fulfill job demands and technological advances required to make a more sophisticated network of the economic system.
A guaranteed minimum income in Switzerland? @Gerhard_Fehr takes a #behaviouraleconomics view https://t.co/Wz40J8blwG pic.twitter.com/2ycCrM3gBO
— Koenfucius (@koenfucius) May 14, 2016
Detractors of the plan also said that “you cannot give society the idea that money is available for doing nothing,” since the income is guaranteed to citizens, working or not, this claim has no room. The seemly fairer economic model was not received as such by most Swiss voters. Switzerland proved to have a critical interest in the fair compensation and minimum wage problems, being the highest in the world (actually, about $25 an hour) when compared to Europe and the U.S.
Also, referendums are not a standard process in countries’ decision-making moments about macroeconomic politics. To some, the original plan involved some elements that are not adjusted to the reality, making it an empty proposal. And it showed in the Referendums’ results.
Source: The New York Times