Chapter VII
Economic Commission for Latin America and the Caribbean (ECLAC)
In Latin America and the Caribbean, the debate on basic income stems from the relatively recent expansion of non-contributory social protection.7 In particular, from the rights standpoint, the implementation of basic income would represent an evolution of the conditional and targeted cash transfers applied in the past 20 years, which, over time, have legitimized cash transfers and the possibility —or, in some cases, the right— of accessing income through a different route than that of asset ownership or employment. In the countries of the region, a guaranteed universal basic income could only be implemented gradually, progressively and with a long-term perspective. The possible modalities for implementing such an income are highly varied (by age group, by territory, by income level) and would depend on the conditions prevailing in each country; but it is not impossible and it could become a tool to achieve the Sustainable Development Goal of ending poverty. Extending a basic income guarantee would require a tax system capable of making it possible. Unlike conditional cash transfers, which involve modest resources in GDP terms —both because of both their focus and their small amounts8— a guaranteed basic income would represent a major mobilization of resources. This is not unattainable for the region’s development level, but it does require taxation with much greater receipts, progressiveness and redistributive capacity. Given the varying economic and demographic situations of the region’s countries, following analysis of the costs and benefits of universalizing government-funded non-contributory cash transfers to older persons and families with dependent children,9 Filgueira and Espíndola (2015) conclude no single benefits model can be proposed for all countries. Each one would have to have the discussion and adopt strategies to expand basic income guarantees according to its fiscal capacities, social needs and economic possibilities. Beyond income differences, unequal ownership of physical and financial assets is a structural condition that deepens and perpetuates inequality, since it is more lasting, intense and rigid than the inequalities that originate in labour markets. It is therefore worth considering the proposal that the new welfare regimes should be based on a more equitable distribution of asset ownership, which can be achieved by strengthening public ownership, the commons, and policies to promote access to asset ownership by the lower-income sectors. Policies aimed at improving asset distribution seek to strengthen social and solidarity-based economies. Associativity, cooperativism, fair trade initiatives and, in general, the production initiatives of social and community organizations, have not received the policy backing they would need to expand, even though they create a large share of jobs and employment and can boast success stories in terms of innovation, productivity and equitable distribution of results and benefits. Access to credit and financial services under conditions of equality and with a progressive logic —in other words financial inclusion— is another important tool for moving towards a style of development that closes economic and gender gaps.10
7
Some modalities of monetary transfers are related to the philosophical foundations of guaranteed basic income (individuality, universality, unconditionality), such as the citizen pension for older persons in Mexico City and, to a large extent, the Pension for Older Adults programme in Mexico, the Renta Dignidad programme in the Plurinational State of Bolivia, and the Universal Child Allowance in Argentina. 8 Cecchini and Atuesta (2017) estimate that expenditure on conditional transfers in Latin America and the Caribbean amounted to 0.33% of regional GDP in 2015, and expenditure on non-contributory pensions accounted for about 0.40%. 9 Around 2011, the cost of universalizing a monetary transfer equivalent to a poverty line for households with children and members aged over 65 years varied from a minimum of 1.5% of GDP in Argentina and Chile to a maximum of 13.7% of GDP in Guatemala. 10 Given the barriers that women face in accessing the financial system, financial inclusion policies can enhance their autonomy and gender equality (Rico, 2017; ECLAC, 2017b).
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