The Incentive to Work by Justin Douglas

[Ed. Note: With the author’s permission, I’m re-publishing essays from his former site asobinomics.net, as they originally appeared in 2012. Here’s the first!]

Lately I’ve been exploring the idea of a guaranteed basic income, also known as a citizen’s income or a negative income tax. Whatever the name, the principle remains the same: give every citizen a stipend for basic living expenses in order to end poverty, reduce inequality, and increase everyone’s well-being.

Without fail, the notion triggers some sort of gag reflex in the people I’ve mentioned it to. “But people wouldn’t have any incentive to work,” they protest, as if America would grind to an egalitarian halt the instant such a measure were put in place. You’d think I was trying to turn America into the USSR [cue mental image of Soviet breadlines], or — worse yet — propose universal health care in Congress. Gasp!

This is not, however, some radical lefty anarchist fantasy. (Not that there’s anything wrong with that.) The basic income has been proposed by, among many others, Milton Friedman and Richard Nixon, two men whose establishment credentials are, I would imagine, beyond reproach.

Granted, the Soviet economy did suffer from major work incentive problems; one would be hard-pressed to find evidence to the contrary. (Contrary to popular belief, however, workers were not all paid the same wages.) But although we may not have breadlines in America, I don’t think soaring inequality and plummeting social mobility, as a general rule, prod people out of bed in the morning any more effectively than do over-full employment and state ownership of intellectual property. After all, the Cold War triumph of Extreme Capitalism was more a victory by default than a true knockout anyway.

Yet people keep rehashing the “incentive to work” argument without really thinking about it, which is partly why we’re in this mess today. So, in the interest of getting us out of said mess, let us take a critical look at this phrase, starting with the first half.

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To give someone an incentive to do something is to motivate or encourage them to do so. Notice the positive connotation of those alternatives; they imply that the person was already on their way to doing whatever it was they set out to do, but just needed a push. Incentive, on the other hand, seems to imply that, left to their own devices, the person probably would not have done so. I could be wrong, but that’s my sense as a native English speaker and language nerd.

Of course, it wasn’t always so. Incentive dates back to the 15th century, and comes from the Latin incentīvus, “incite to action.” It shares some linguistic DNA with incantāre, “chant” or “charm,” which evokes the image of a troubadour gently rousing a sleeping beauty with a lovely Renaissance melody. So what happened to our dear incentive?

Well, to put it bluntly, capitalism happened.

Incentive, in the sense most familiar to us, dates back to 1776, the year of publication of Adam Smith’s The Wealth of Nations, the founding text of classical economics. Economics, being a system of theories about life, is like philosophy, really, except that it has a compulsion to quantify everything in terms of money, which it believes is the one true yardstick. So on second thought, maybe it’s not really like philosophy, except in the most perverted sense. In any case, Smith defined incentive as a means of steering a market toward a balance of supply and demand (equilibrium). Import tariffs and tax exemptions are two such examples. Thus was our Renaissance melody stripped of its beauty, bent to serve the machinations of Industry.

On the actual nature of work itself, classical economics is silent. Intrinsic motivations, such as passion and altruism, and individual, societal, and environmental well-being, immeasurable qualities that they are, are labeled “externalities” and considered irrelevant. With those messy intangibles taken out of the equation, labor is neatly reduced to a commodity like any other, something to be exchanged (bought) for money (wages) on the labor market (that is, the open-air fair where people who need jobs meet employers who need employees).

Just like the prices for other goods, wages — the prices of labor — are supposed to serve as an incentive to attract the right workers to the right jobs. And, money only being useful insofar as it can be exchanged for other goods and services, the whole purpose of work, the “charm,” if you will, then becomes simply the ability to buy stuff. (Ad execs just love them some Adam Smith.) But the siren song of the Industrial Revolution fell on deaf ears. Most townspeople at the time were quite content to work just enough to provide for themselves, and no more. They were understandably loath to give up their self-sufficiency and leisure to be employed for long hours at meager wages in grim and grueling factories and mines, much to the consternation of the early industrialists. I mean, wouldn’t you be too?

Enter the Protestant work ethic. Captains of capital called upon men of influence to make work into a moral issue. Hard work — for another — is virtuous, they proclaimed; one must suffer on earth to be granted salvation up above, or else face eternal damnation. Needless to say, the superstitious scare tactics worked (pun intended). In fact, Americans’ fervor for work drew the admiration of visitors from around the world, including no less than Friedrich Nietzsche. And then, at the turn of the 20th century, the edicts of Calvinism and capitalism, both having assumed something akin to divine rule in our society by then, gave birth to consumerism. Case in point: Henry Ford did not offer his employees the highest factory wages of the time out of benevolence; he simply wanted them to buy more of the cars they were making.

It’s an unfortunate testament to the power of these myths that, even today, so many people still accept the surrender of much their waking life and autonomy to a boss and a paycheck as a fact of life, even if not in such overtly religious terms. It’s not that religion has disappeared; rather, it would be more accurate to say that a little of the Calvinist spirit was kept alive in the new consumerism of the American Dream, which became our object of worship from the 50s until recently. Anyone, no matter where they come from, can earn their spot in the ranks of the middle class, complete with car, house, picket fence, and manicured lawn, through the merits of their own hard work. At least, that’s how it’s supposed to be.

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God-as-factory-warden does survive, however, in modern-day political ideology: conservatives call Him “personal responsibility.” (Liberals gush about finding one’s “calling,” but that’s for another post.) The cult of personal responsibility praises toil and condemns sloth, which it sees as the natural condition of man in the absence of employment. (Conservatives are a little more generous than Hobbes, but not by much.) We are taught that it is necessary to earn a living and contribute to society. But without the threat of God over our heads, it is not clear why we must earn a living, nor is it clear how, say, being a wage slave for McDonald’s is contributing positively to society.

The economy hasn’t done much to help the conservatives’ case, either, even though it was precisely the conservatives who charted its course over the past few decades. The massive upward transfer of wealth in this country since Reagan has created a large class of working poor who work two or even three miserable jobs and still barely scrape by. Even those higher up on the food chain work profusely in the fear that they might be sacked in the name of “efficiency” and higher profits. Skyrocketing higher education costs make it possible for many, working poor or otherwise, to attend college only by shouldering massive loans — and even then, the past decade has shown that a college education is no longer the ticket to upward mobility. And after 9/11, Bush the Younger exhorted us to stimulate the economy by buying stuff, and borrowing if we didn’t have the cash.

The result is that debt (from college and credit cards alike) and job security are now the primary incentives for many Americans to work. For those who grew up believing the American Dream, is not survival a disheartening carrot, and poverty a cruel stick?

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The financial crisis laid bare a perverse truth. Call it the American Hypocrisy: although hard work may be rewarded by God, it is punished by the economy, while the sinful greed of the bankers, on the other hand, is rewarded by the economy. I can only hope that they will be punished in eternity.

Nevertheless, it’s telling that we talk about the “incentive to work,” which frames the discussion in economic terms and steers clear of philosophical questions regarding the “purpose of work” or one’s “reason for working.” I’ll get into that next week, with the continuation of this essay. In the meantime, don’t let any liberal job-creationists or conservative neo-Calvinists try to pull a fast one on you — send them here instead.

You can e-mail author Justin Douglas at: tabidots at gmail dot com.

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