Inheritance for everyone

Gabriela Pinilla, The people is a sea, Watercolor on paper and lithograph, 100 X 70 centimeters, 2019, Bogotá, Colombia
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By THOMAS PIKETTY*

Inheritance for all aims to increase the bargaining power of those who have nothing

The Covid-19 crisis forces us to rethink the tools of redistribution and solidarity. Proposals flourish almost everywhere: basic income, guaranteed employment, inheritance for all. Let's say right away: these proposals are complementary and irreplaceable. Ultimately, all must be put into practice, in stages and in that order.

Let's start with basic income. Today, this system is almost non-existent, especially in the South, where the income of the working poor has plummeted and where confinement rules are inapplicable or in the absence of a minimum income. Opposition parties have proposed introducing a basic income in India in the 2019 elections, but conservative nationalists in power in Delhi have postponed it and acted as if it were not urgent.

In Europe, there are different forms of minimum income in most countries, but with multiple insufficiencies. In particular, it is urgent to extend access to younger people and students (this has been the case in Denmark for a long time) and, especially, to people without a home or bank account, who often face an insurmountable trajectory of obstacles. It should be noted in passing the importance of the recent discussions around central bank digital currencies, which ideally should lead to the creation of a true public banking service, free of charge and accessible to all, as opposed to the systems dreamed of by private operators (whether decentralized and polluters, like bitcoin, or centralized and unequal, like Facebook projects or private banks).

It is also essential to generalize the basic income to low-wage workers, through an automatic payment system on payrolls and bank accounts, without the interested parties having to request it, in connection with the progressive tax system (also deducted at source ).

Basic income is an essential but insufficient tool. In particular, its amount is always extremely modest: it is generally situated, according to the proposals, between half and three quarters of the full-time minimum wage, so that by construction it can only be a partial instrument in the fight against inequalities. For this reason, it is also preferable to speak of basic income rather than universal income (a notion that promises more than this minimalist reality).

A more ambitious tool that could be implemented in addition to the basic income is the job guarantee system, recently proposed in the context of discussions on the Green Deal (La Garantie d'emploi. L'arme sociale du Green New Deal, by Pavlina Tcherneva, La Découverte, 2021). The idea is to offer anyone who wants it a full-time job with a minimum wage fixed at a decent level (15 dollars [12,35 euros] per hour in the United States). Financing would be provided by the State and jobs offered by public employment agencies in the public and associative sector (municipalities, communities, non-profit structures). Placed under the dual umbrella of the Economic Bill of Rights proclaimed by Roosevelt in 1944 and the March for Work and Freedom organized by Martin Luther King in 1963, such a system could contribute powerfully to the process of decommodification and collective redefinition of needs, particularly in terms of personal services, energy transition and building renovation. It also makes it possible, at a limited cost (1% of GDP in Ms. Tcherneva's proposal), to put to work all those who are deprived [of work] during recessions, thus avoiding irreparable social damage.

Finally, the last mechanism that could complete the set, in addition to the basic income, the guarantee of employment and all the rights associated with the broadest welfare state (free education and health, strongly redistributive pensions and unemployment fund, rights unions, etc.), is a system of inheritance for all. When studying inequality in the long run, what is most impressive is the persistence of hyperconcentration of property. The poorest 50% almost never own anything: 5% of total wealth in France today, compared to 55% for the richest 10%. The idea that it is enough to wait for the wealth to spread doesn't make much sense: if that were the case, we would have realized it long ago.

The simplest solution is a redistribution of inheritance allowing the entire population to receive a minimum inheritance, which to fix ideas could be around 120.000 euros (ie 60% of the average wealth per adult). Transferred to all at age 25, it would be funded by a mix of progressive wealth and inheritance taxes, yielding 5% of national income (a significant amount, but attainable in a given time frame). Those who currently inherit nothing would receive €120.000, while those who inherit €1 million would receive €600.000 after taxes and endowments. We are, therefore, still a long way from equality of opportunity, a principle often defended on a theoretical level, but which the privileged classes distrust like the plague as soon as one considers the beginning of its concrete application. Some will want to restrict its use; why not, as long as they apply to all inheritances.

Inheritance for all aims to increase the bargaining power of those who have nothing, to allow them to turn down certain jobs, acquire housing, launch themselves into personal projects. This freedom has everything to frighten employers and owners, who would lose docility, and to delight others. We are painfully emerging from a long dome. All the more reason to start thinking and hoping again.

*Thomas Piketty is director of research at the École des Hautes Études en Sciences Sociales and professor at the Paris School of Economics. Author, among other books, of Capital in the XNUMXst century (Intrinsic).

Translation: Aluisio Schumacher to the portal Major Card.

Originally published in the newspaper Le Monde.

 

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