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COVID-19 and Guaranteed Basic Income GBI – Minimum Income

March 20, 2020

By Wade Rowland

It’s a commonplace to observe that an existential crisis clarifies thought. Frequently, it offers opportunity to do the impossible, to get things straight.

Case in point: the graduated income tax, by now universally accepted as the most equitable way to raise money for running any country, was brought in during the crisis of World War 1. It is still with us because it works much better than the system of customs and excise taxes it largely replaced. It was introduced, reluctantly, by a Conservative government, under Sir Robert Borden.

It was during another existential crisis, the Great Depression in 1932, that another Conservative Prime Minister, R.B. Bennett bequeathed to the nation our public broadcasting system, modelled on the BBC. The CRBC (later the CBC/Radio-Canada) was to be a bulwark against American radio broadcasting inundating the country, threatening our cultural sovereignty and our national identity.

Medicare, our single-payer health system, was first introduced by CCF Premier Tommy Douglas in Saskatchewan in 1947, when memories of the Great Depression were still fresh in the minds of prairie voters; Alberta adopted similar legislation a couple of years later. Liberal Prime Minister Louis St. Laurent, who knew a popular idea when he saw it, took the scheme country-wide in 1957.

Now we are in the midst of another historic crisis. And we have another historic opportunity to make this country a far better, more compassionate, more successful place than it has been in the recent decades of tight-fisted neo-liberal dogma.

Ottawa’s response to the dire straits facing millions of Canadians who have lost their jobs due to draconian “social distancing” measures we are having to live with has been a generous relief package amounting to as much as 3% of GDP. There are enhancements of a variety existing programs, and special initiatives designed to help workers in the so-called gig economy— the burgeoning “precariat’ made up of those who work from week to week on contract, or are self-employed. Everything from hospitality workers to Uber drivers to delivery people to university teaching assistants. But the complexities of quickly getting money into the hands of these people through the tangled web of exiting social assistance programs and split provincial and federal jurisdictions is a nightmare, both for civil servants and those they’re trying to serve.

A less expensive, more immediate and straightforward solution, one the Prime Minister and Treasury Board Chairman Jean-Yves Duclos have both had positive things to say about, is a guaranteed basic income plan for all Canadians.

A pilot GBI project in Ontario, snuffed out by Premier Ford’s Conservatives in 2018, paid about $17,000 to individuals and up to $24,000 to couples. Participants had to be aged 18 to 64 and living on low income. If recipients worked while receiving the benefit, they agreed to give the government 50 cents for every dollar they earned, so that when their income hit $35,000 the supplement would end.

A federal GBI plan to replace the existing patchwork of assistance measures could cost about $43 billion, according to the Parliamentary Budget Office report released two years ago—the one that prompted the comments from Trudeau and Duclos.  There’s no space to go into detail here (you can look it up at the PBO website, but a cooperative federal-provincial plan would reduce the overall cost even further. By comparison, Ottawa’s COVID-19 relief/stimulus package adds up to about $82 billion, so far.

“Crisis” and “opportunity” may not be two brush strokes in a single Mandarin letter as popular mythology has it, but history shows how they can often be two sides of the same coin. At a time when it has never been more clear that “we’re all in this together,” that my own well-being is directly dependent on my neighbour’s and vice-versa, Ottawa should seize this historic opportunity to rationalize the country’s social safety net with a guaranteed basic income for all Canadians.

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