It is possible that a full “economic recovery,” that is the economic activity that will precede the next recession or depression will not provided us with the type of “full employment” that we used to experience.
Our view of what the economy is shall also possibly be changing from one where we think that is fueled or is motivated by the concept that all of us can become rich to one where the collective gains require a wider spread.
A recent Swiss proposal that would have called for a monetary distribution to all Swiss citizens 18 and older of about $2800 per month, about $33,000 per year appears a first approach to a better distribution of wealth within a capitalistic nation. The institution of such a program is likely to operate against our present laws providing for temporary and emergency relief and welfare packages.
This basic amount of money constantly available for regular spending would also lessen the possibility of recessions, if not totally eliminate them and their general economic effect. This step is one and perhaps the first toward a significant type of what I refer to as “human economics.”
In a country like Switzerland, where college education is free, where the comprehensive health program is from cradle to grave, imagine the freedom that everyone, especially at 18 would have at charting their adult lives. Even if they started unsuccessful businesses they would never be out on the street.
Most of this money would be spent on a daily basis and would likely have some effect not only on a underlying insurance against recession, it would seem, but would keep economist busy trying to understand as to how much of an inflation factor it would become, especially in the earlier years. Much of course, would change in terms of social life.
For example, two young adults living together on about a $65,000 a year would have to engage in little more work to survive quite well or take their time in finding jobs that would pay quite well and be in a good bargaining position when seeking work, no $10.10 minimum wage here.
The natural argument against such a program would be, and probably has been that the wealthiest of the nation would be baring the cost, wages would generally go up as workers would be in better bargaining positions and it would encourage a great deal of idleness in the country.
We don’t really know the results of such an experiment if this sort of program were to be put to the test. But it is likely, now that it has become a real proposal but of course turned down at a recent Swiss election, that at some point, even at less the $2,800 per month, it may be put to a real test.