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The CERB program has proven that a minimum basic income is a bad idea

February 2021

The Canada Emergency Relief Benefit (CERB) program, introduced by the Canadian government on 6 April 2020, was a necessary program, meant to compensate Canadians who lost their income due to the government mandated shutdowns due to the rising infections of the Chinese Communist Party (CCP) Virus.

Unfortunately, the $2000 a month taxable government payment to each eligible applicant, also had an unintended consequence of discouraging people from returning to work once businesses were allowed to re-open. For those who routinely made around $2000 a month at their jobs before the pandemic, it seemed to make little sense to return to work when they could make around the same amount sitting on their couch.

Some of those who did return to work, would make requests to their employer to keep their hours down so that there would be no claw-back of their CERB benefits, something that happened if they earned more than $1000 in a month.

Socialism is great until you run out of other people’s money. This is one of the many reasons why a capitalist system, despite the flaws of capitalism, is a much better a socialist system.

Capitalism encourages people to constantly strive for better, with better monetary returns the reward. In free-market, capitalist systems, businesses will compete to make a better product, or provide a better service than their competitors. The results are things like higher profits for the company, higher monetary returns for the owner(s), higher pay for the workers, especially those who are high-performers and higher taxes paid to the government from both the business profits and payroll deductions.

Generating higher profits means things like the business can invest in new equipment, expand their workforce, and expand their operations at their current site or other sites in other locations.

In a socialist system, where everyone receives the same compensation regardless of the amount of work done, their is little incentive to do more than the bare minimum at their job, create new products or businesses, or strive to make the world a better place.

As tempting as it may be for some to implement a system of paying people for doing nothing, there is a very valid concern that the result is that society gets nothing in return.

While a caring and compassionate society has a duty to take care of our most vulnerable, the concept of a basic income includes more than just those who can’t work due to a disability, for example. The only way I would agree with a basic income program is if those accepted into the program are ineligible for any other low-income financial assistance programs. What you get in a basic income payment is all that you get, so make sure to budget your money well, especially if you don’t plan to work on top of your government income.

Thus is the conundrum.

Sources: https://www.cbc.ca/news/politics/economies-covid19-benefits-scheer-trudeau-1.5554650, https://www.canada.ca/en/employment-social-development/news/2020/08/government-of-canada-announces-plan-to-help-support-canadians-through-the-next-phase-of-the-recovery.html, Canadian youth, have your say on basic income (insidehalton.com).

About the author

Bruce Forsyth

Bruce Forsyth served in the Royal Canadian Navy Reserve for 13 years (1987-2000). He served with units in Toronto, Hamilton & Windsor and worked or trained at CFB Esquimalt, CFB Halifax, CFB Petawawa, CFB Kingston, CFB Toronto, Camp Borden, The Burwash Training Area and LFCA Training Centre Meaford.

Permanent link to this article: https://militarybruce.com/the-cerb-program-has-proven-that-a-minimum-basic-income-is-a-bad-idea/

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