The 2,500 francs would work out to be an income of 30,000 Swiss francs per year.
Every Swiss adult may start getting a salary of over $2,800 (2,500 francs) per month whether they work or not. Switzerland has based this on the idea that their citizens will have more time to devote to things they are intrinsically interested in, instead of spending the majority of their time worrying about how they are going to survive, as many individuals with entry level positions find it hard to meet their needs. The income initiative promises every Swiss citizen a living wage , so they can always survive without basic financial worry.
The 2,500 francs would work out to be an income of 30,000 Swiss francs per year. Statistics released by the European Union in 2002 showed that Switzerland was the third most expensive country in Europe, after Norway and Iceland, to live in. Switzerland currently has a population of 8.02 million people, equivalent to that of large cities such as the San Francisco Bay Area which has a population of 7.15 million. They pay particularly high prices for meat, cooking oil, fish and vegetables. Basic utilities (electricity, heating, water, garbage) are around 200 francs per month, and the average rent of a one bedroom apartment in the city center runs about 1,400 francs.
“Imagine you are being born and society tells you ‘Welcome, you will be cared for, and asks you what you want to do with your life, what is your calling? Imagine that feeling, that’s a whole different atmosphere “ – Daniel Straub, Co-founder, Basic Income Initiative
Parliament was presented with a petition signed by over 100,000 people, proposing to afford every citizen, regardless if they are working or not, a monthly paycheck of 2,500 Swiss francs. To mark the day, a truck full of 8 million five-cent coins was deposited on the square and spread out in front of the Swiss Parliament in Bern, supporters gathered around and spread the coins out using shovels. A typical fast-food worker in the US earns roughly $1,500 per month. Anything less than that specified amount of 2,500 francs, would be deemed illegal, even for people working in one of the lowest paid jobs.
A date for the vote itself is yet to be confirmed, however, it could take place before the end of this year, depending on the decision of the Swiss government. The money to fund the measure would likely be supplied by the Swiss social insurance system, so in other words it would be taken from taxpayers. We know that the government has no money itself, everything that it gives to others it must first take from others or print it out of thin air. But, are individuals who receive these funds going to be participating tax payers as well? If not, is it safe to assume that the more individuals who rely on this system, and the fewer who are contributing and fueling it, the more unlikely it is to run out of funds? Is this only possible due to Switzerland’s low population and impressive bank profits?
This new system will force business owners to pay their workers a certain wage, regardless if their labor is considered worth less than the stipulated amount. This idea aims to set the minimum standard of living higher, and that is admirable. But this might prompt business owners to take their company elsewhere, to where they have more freedom over the decision of what wages they are going to pay. Of course this would also mean they get no cut whatsoever of the Swiss market. And on the other hand, the new income may also allure new business owners to the country in looks of attracting those new consumers. One prominent CEO in Switzerland has stated that if the measure passes, he would seriously contemplate moving his company out of the country:
“I can’t believe that Switzerland would cause such great harm to its economy,” Glencore CEO Ivan Glasenberg told the Swiss Broadcasting Corporation.
The unemployment rate currently remains at 3 percent in Switzerland. Switzerland is arguably one of the most stable economies in the world. The nation has built the reputation of having some of the most friendly laws toward foreign investors. Will this measure make more money flow, by putting liquidity in the hands of those more prone to putting it back in the economy, or will it drive investors away and cause the Swiss economy to stumble?