usbigdiscussionpaperno.29,march2002.docVIP

USBIG Discussion Paper No. 29, March 2002 Work in progress, do not cite or quote without author’s permission PROMOTING ECONOMIC EQUITY IN A 21st CENTURY ECONOMY: THE BASIC INCOME SOLUTION Charles M. A. Clark St. John’s University WHAT IS ECONOMIC EQUITY AND WHY IS IT IMPORTANT It is no accident or coincidence that just about every human society has had some mechanism to promote economic equity. From the Old Testament’s redistribution of wealth through the Jubilee to the modern welfare state, a common feature of human society has been the redistribution of wealth and incomes to account for those who have not been adequately provided for by the given “rules of the game” that determine income allocation. This constant feature of social living shows that there is a need to account for factors besides existing property rights in determining the ability of individual community members to subsist and thrive. The reason that such redistribution schemes are a fundamental feature of human societies is that wealth and incomes are collectively created, but often the rules that determine the initial distribution of incomes, usually based on power and property rights, do not typically provide for the whole community. Many people in the community are not currently economically productive but still need to be provided for to ensure the economic sustainability of the community (children and the elderly). Furthermore, many factors besides what is necessary to promote future production influence what the initial distribution of income will be (such as a lucky hunter), thus it may be harmful to the health of the community to allow such inequalities to persist. Anthropologists have long known of these features of human society, yet they are often ignored when analyzing modern capitalist economies, yet the need for redistribution is just as necessary today as it was for our ancestors. Our economy produces a distribution of income that has levels of inequality well