An old ideological debate is confronting the advocates of individual responsibility with the promoters of collective solutions. A microscopic virus 100,000 times simpler than our DNA is about to solve this never-ending discussion: we truly depend on each other. Our tax schemes should be adapted to this « war » economy.
In January 2020 – centuries ago – most of the European and American countries thought that the new Chinese coronavirus was less dangerous than the SARS virus of 2003 and the seasonal flu. It was a time when the western democracies looked with compassion on the authoritarian measures taken by the Chinese dictatorship in Wuhan. Since then, Italy has surpassed China’s lethal record and most countries are now settling into an uncomfortable confinement. Based on the adage that « what doesn’t kill makes stronger », this worldwide event offers the rare opportunity to think aloud about the way our societies function.
What’s new? This planetary crisis can affect anyone personally, with a serious vital risk. No one is too strong to consider heartily the risk of being infected with this coronavirus. Nevertheless, we must continue to live somewhere on this planet, to get supplies, to take care of ourselves in case of accident or illness. Until now, the rich could always afford a solution, by moving or buying the necessary services, while the poor had more difficulty in coping with the consequences of various hardships. Exceptionally this is no longer the case. The virus is spreading in all countries, regardless of class. And the risk is immediate, unlike the more or less visible consequences of global warming, which some people find comfortable putting into perspective or rejecting in the distant future.
Here we are: all prisoners in the nave of Notre Dame de Paris in fire, whom we must save from destruction. There is only one solution: to stop the spread of the virus as soon as possible, like flames. Confinement is not optional. Everyone has a role to play in this fight. But practically, staying at home for two months does not have the same consequences for everyone.
« Stay at home! ». Fully relevant, yes. But for those who don’t have a home?
In some cities in France, homeless people have been fined for not respecting the national confinement order. The absurdity of the situation has come to light, showing a sharing of irresponsibility between individuals and the community. While the emergency is there, can the police forcibly take the wanderers from our cities and house them in closed shelters? This leads to two sub-questions. Will the population accept for a long time the risk associated with these errant people carrying their dose of pathologies? Is it possible to house the homeless elsewhere than in saturated shelters, where promiscuity would ensure a rapid progression of the virus?
The issue of the homeless is not new, but the current crisis makes it explosive. Without having been able to provide adequate answers to the question of housing for the most fragile people in our society, nor having had the courage to lay down rules deemed authoritarian on the obligatory – forced – sheltering of wandering people, we have to deal with a critical problem in a short time.
At this time, we would very much like the “housing first” programs to be fully operational in our countries, so that no one is left wandering in our cities. The epidemic tells us something for the long term: we all need healthier and more inclusive cities.
Encouraging telework, yes! But this is not a solution for everyone
At the other end of the social scale, executives in established companies, who divide most of their days between (telephone) meetings, e-mails and the coffee machine, carry on their professional activities thanks to the technological conveniences installed in their homes. When their apartment or house, whether in the cities or in the countryside, provides each member of the family with a sufficiently comfortable living space, the inconveniences of confinement are relative. Pay will be there as usual at the end of the month, along with any bonuses linked to individual and group performance.
Production jobs, in factories, on building sites, outdoors, in shops or at home, do not allow for this comfort. The virus is putting millions of people out of work. Some of them are sure to receive an income from their company, which is strong enough to cope with the circumstances. Others, especially craftsmen and self-employed people, earn their income from invoicing for the services they provide by visiting their customers. Confinement is drying up their only source of income.
Thus, not all businesses are impacted equally by confinement. The owner of a small masonry company goes out of business when his material suppliers stop delivering materials. His workers stay at home and wait for their pay at the end of March… Fortunately, most governments propose plans to help their people coping financially with this forced unemployment.
In many countries we see advocates of some sort of basic income claiming for a universal allowance to get through. Even Donald Trump considers giving away $1,000 to $3,000 for everybody to cope with this outstanding downturn which begins to look like the 1929’s crisis.
A war economy begins with an outstanding tax scheme
The lack of income for the millions of families who will be forced out of work in the coming weeks, for a period probably reaching a few months, is – like the issue of the homeless – a sign of the fragility of our societies. Among these newly unemployed, many have always worked, have never been sick, have got up early every day to respond to their clients’ requests. No one would think of calling them profiteers. Yet, in this period, they will owe their subsistence to the generosity of the welfare state.
Thus, the state will have to urgently pay income to millions of citizens. But where does the money come from? More debt? Meaning that our children will have to pay for it? A fair solution would be to distribute a minimum allowance to the entire population and levy an exceptional solidarity tax on those whose income remains untouched despite the coronavirus.
The most effective formula could look like this: for the year 2020, replace the complicated formula of the current income tax with a « war » redistribution function applicable to the entire population. In France, the formula could be a combination of a 50% levy on all personal income, from the first euro, and a monthly allowance of 750 euros paid to each adult. This mechanism would temporarily replace most conditional social benefits.
Thus, everyone would be sure to receive at least 750 euros each month and would share half of their other income with everybody. At war, the time is not for individualism, but for convivialism!
Those who believe that they will escape by themselves from the coronavirus threat will probably not agree with this proposal. But those who agree that the current challenges of our world require greater cooperation by all will look upon this proposal with interest.