Social Policy in Ontario

The Trudeau Liberals just prioritized one of Richard Nixon’s favourite conservative policies: ‘mincome’

Posted on May 31, 2016 in Social Security History

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NationalPost.com – News/Canada/Politics
May 30, 2016.   Tristin Hopper

The Woodstock stages at Yasgur’s Farm were just nearing completion when, in 1969, U.S. president Richard Nixon addressed the nation with a bold new plan to “abolish” poverty.

“It removes the present incentive for families to break apart and substitutes an incentive for families to stay together,” Nixon said of his scheme. “It removes the blatant inequities, injustices, and indignities of the welfare system.”

Nixon’s plan, oddly enough, would soon become North America’s progressive policy du jour; a far-left fever dream in the same camp as free tuition and a $15 minimum wage. The Liberals made it a priority at their recent convention. The NDP’s Leap Manifesto gives it special mention. The Green Party has touted it as a magical cure-all that will empty prisons and make people healthier.

Richard Nixon was proposing a guaranteed minimum income. Or as he called it, the “Family Assistance Plan.”

“It establishes a basic federal floor so that children in any state have at least the minimum essentials of life,” he said.

And Nixon wasn’t the only conservative in the 1960 touting some form of proto-“mincome.”

Economist Milton Friedman was a free market champion who once denounced minimum wage laws as the most “anti-black law in the land.” Nevertheless, he touted a “negative income tax” as way to “treat people who are poor the same way we treat people who are rich.”

George Shultz, an economist who would one day become President Ronald Reagan’s Secretary of State, was a fan of the Nixon proposal. Robert Taft, a union-busting conservative U.S. Senator, had been advocating a “minimum standard of decent living” since the 1940s.

Up north in Canada, meanwhile, a guaranteed income had the backing of longtime Progressive Conservative leader Robert Stanfield.

Had he beaten Pierre Trudeau in the 1968 election, Stanfield promised that a guaranteed annual income was the first plank in his party’s plan to ensure “decent life and equal opportunity for all Canadians.”

The conservative reasoning for “mincome” was simple; by cutting poor people a monthly cheque the federal government would suddenly be freed to dismantle the welfare state.

“It’s a proposal to help poor people by giving them money, which is what they need, rather than requiring them to come before a government official, detail all their assets and liabilities … and then be given a handout,” said Friedman at the time.

In effect, no American would have an excuse to be destitute.

The 2008 book Nixonland sums up the moment Nixon became a convert to the idea. A newly elected President Nixon asked his aide Danial Patrick Moynihan what the proposal would do to the United States’ ranks of social workers.

“Wipe them out,” replied Moynihan, a future Democratic senator for New York.

Indeed, in his televised address, Nixon hinted that Franklin Delano Roosevelt’s New Deal had “left us a legacy of entrenched programs that have outlived their time or outgrown their purposes.”

Another plus was the possibility that it would drive thousands of welfare-collecting Americans to apply for a job.

Instead of losing their welfare benefits the moment they got a job, the Nixon plan would allow Americans to earn their paycheque on top of an earnings “floor.”

“The present system often makes it possible to receive more money on welfare than on a low-paying job,” said Nixon. “It is morally wrong for a family that is working to try to make ends meet to receive less than a family across the street on welfare.”

The Liberal proposal for a minimum guaranteed income struck a bit of a different chord over the weekend.

Rather than dangle the promise of a smaller federal government or more working poor, the resolution promised to fix the “ever growing gap between the wealthy and the poor.”

Ignore this “gap,” and Canada could soon face a dystopia of “social unrest, increased crime rates and violence.”

Nevertheless, the Liberal proposal does claim that the plan would be “cost neutral.”

This is not based on any concerted plan to take a scythe to the welfare state. Rather the Liberal proposal assumes that once the mincome cheques start rolling in, Canadians will be happier, healthier and generally better behaved.

“Savings in health, justice, education and social welfare as well as the building of self-reliant, taxpaying citizens more than offset the investment,” it reads.

This is largely based upon the experience of Dauphin, Man., a small town that was subject to a mincome pilot project in the 1970s.

Over the five years studied, the town saw hospitalizations and psychiatric diagnoses drop as much as eight per cent.

In its purest form, mincome still gets a thumbs-up from Canada’s fiscal conservatives.

“It would do away with administrative duplication that inevitably occurs in a multi-program, multi-government system,” reads a 2015 report by the right-leaning Fraser Institute.

The problem is that nobody trusts a Canadian government to perform the second plank of a Friedman-esque mincome program. Namely, to “wipe out” the bureaucrats.

As per the Fraser Institute’s numbers, Canada now spends an incredible $185 billion per year on social spending; a sum equal to 22 per cent of total government expenditures.

Thus, any politician looking to replace the welfare state with mincome would find themselves in the sticky position of trying to reform or abolish “approximately a quarter of total government activity in Canada.”

The “risk,” claims the Fraser Institute, is that guaranteed income would become “an add-on rather than a replacement program.”

“It’s implementation that becomes the problem,” said Aaron Wudrick, federal director of the Canadian Taxpayers Federation, another “on paper” mincome supporter.

“It’s a lot easier to put things in place than to take them away.”

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Tags: economy, featured, ideology, participation, poverty, standard of living

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