So, you think Bernie Sanders’ idea of free college is radical?
The Swiss recently voted on a proposal that would guarantee every citizen a free “basic income” – 2,500 Swiss francs ($2,520) per month, untaxed and with no other obligations.
Unemployed Swiss citizens would get the full amount. Those who work but earn less than 2,500 francs per month would receive the difference from the government.
Supporters of the measure, which would have replaced some welfare payments, said the measure was necessary to provide a sense of economic security for the many Swiss workers who are at risk of losing their jobs because technological advances that have disrupted their industries. That’s a curious argument given that Switzerland’s 4.5% unemployment rate is one of the lowest in Europe – and the world.
Proponents, who had been pressing the measure since 2013, said Switzerland is a rich country that can afford to support its lowest-income citizens. That 2,500 francs is just above the poverty line for Switzerland.
Europe’s post-war slouch towards socialism has kept the continent’s economy in a lower gear, even in the boom times. Restrictive employment laws and other regulations stunt growth and innovation. While the Swiss proposal sounds like another step down that road, there is actually good news in this story.
First, the Swiss people widely rejected the measure. Only 23% backed it, according to the BBC, while roughly 77% opposed it. Second, the government vehemently opposed the idea, saying it would cost 25 billion franc per year, money that would come from either tax hikes or spending cuts, both of which could harm the economy. What’s more, 90% of Swiss surveyed about the proposal proir to the vote said they would continue working even if it became law. About half said they would use the extra money to attend school – i.e., invest in themselves.
Socialism is a hot house idea. It always seems to pop up in smaller, affluent, homogeneous countries, like those of Northern Europe, where proponents see plenty of wealth and not a lot of intractable poverty. Switzerland has 8.1 million people, about the same as Dallas-Fort Worth.
But based on the reaction to the Swiss proposal, Europe’s people and their leaders may finally be starting to understand that, as former British Prime Minister Margaret Thatcher said, “The trouble with socialism is that eventually you run out of other people’s money.”
Or maybe not. Finland will soon beta test a program that would end all welfare benefits and just give every citizen $10,000 per year.