Nominally nonpartisan banking institutions like the World Bank have long held that a job “is the fastest way out of poverty.” This view has been vigorously supported by conservative economists like Arthur Laffer, who has also maintained that lowering taxes, even at the expense of social services, ultimately benefits workers because employers in a low-tax environment create more jobs.

The resulting increased labor demand, according to the Laffer theory, will raise both employment levels and workers’ wages, thus creating more wealth for everyone.

Two relatively recent developments call these views into question. Instead, there is a new emphasis on this very old idea, a financial guarantee that provides at least a subsistence-level income for all.

This article summarizes the surprising origins of the idea and identifies a few of its colorful early advocates. Following articles on this controversial subject will examine the growing employment crisis that motivates recent guaranteed annual wage proposals as well as a 2017 U.S. tax cut that hasn’t worked the way it was supposed to and which, consequently, has increased calls by liberal politicians for a guaranteed wage.

The origins of the idea

The history of a government-guaranteed minimum income for all citizens could begin as early the sixth century AD, when the prophet Muhammad’s successor, Abu Bakr, proposed that all Muslims receive an annual stipend from the Caliphate’s treasury.

It next surfaced with sufficient force to become a part of the historical record in the 16th century with humanist advocates like Thomas More, who proposed the idea in “Utopia,” his visionary imagining of an ideal world order that also provided the world with a name for such utopian ideas.

However, in 1526, another Renaissance humanist, Johannes Vives, accompanied his proposal for the first time with practical details of how such a scheme would work and why it was a good idea. In “De Subventione Pauperum” (On Assistance to the Poor), Vives argued on moral grounds that political leaders should support and oversee the regular distribution of money to the poor.

What he did not argue, however, was just as significant: He opposed free handouts. In exchange for receiving subsistence income, the poor should — indeed, must — be given an opportunity to work. Thus, this early treatise on guaranteed incomes for all citizens presented both the liberal view (everyone is entitled to enough money to avoid extreme poverty) and the conservative response/objection (only by contributing to the common good through their labor can the poor participate in this obligatory Christian charity).

European proponents of the guaranteed annual income

In the late 1790s, liberal French aristocrats like the Marquis de Condorcet presented the guaranteed annual income (GAI) idea again, this time with an argument that has recently taken on new significance; that the wealth created by the few resulted from labor spent and resources contributed, often involuntarily, by the poor.

In England, particularly, this argument related to the increasing fencing off of “the Commons,” undeveloped land which once was thought to belong to all Englishmen, for the economic benefit of the land-owning class. In fairness, Condorcet argued, the derived wealth needs to be redistributed to everyone.

The marquis managed to complete only one impassioned document arguing for this redistribution before he was guillotined — presumably by some of the same poor who would have benefited from his proposal.

American passion and the GAI

With typical revolutionary fervor, American Thomas Paine soon took on Condorcet’s arguments — in fact, first presented them to the same French politicians responsible for Condorcet’s beheading — and gave them the particular kind of verbal zing that has long aided and hampered the American left: The earth in its natural uncultivated state, Paine argues, belongs to everyone.

Therefore, when the landed and moneyed minority gain control over this land, they have a fundamental obligation to distribute a significant portion of the derived wealth back to its original owners, the people.

Paine’s argument is specific: “For the loss of his inheritance, (the common land rightly belonging to all)…there shall be paid too every person, when arrived at the age of twenty-one years, the sum of fifteen pounds sterling, as a compensation in part, for the loss of his or her natural inheritance, by the introduction of the system of landed property. And also, the sum of ten pounds per annum, during life, to every person now living, of the age of fifty years, and to all others as they shall arrive at that age.”

In a single document, Paine changed the course of the argument from a redistribution based on need (and therefore available only to the poor), to a redistribution based on a universal right and due to everyone regardless of other income.

In the U.S., these two parallel but incompatible ideas — a GAI based on need and a GAI due to everyone — have been argued over, almost continuously since Paine’s first proposal in 1796. The implications and ramifications of various forms of the GAI have been one of the touchstones for all the Democrats seeking the presidency in next year’s election. Predictably, these same proposals have been core exhibits in Republican denunciations of these candidates for introducing unaffordable “soak the rich” socialism.

A following GAI article explains why this idea — long primarily of theoretical interest — has suddenly become socially and politically relevant. A few relevant questions hover over every current U.S. GAI discussion: Is it affordable? Who pays? Is this a democratic initiative restoring the fundamental equality promised in the 14th Amendment, or a socialistic violation of those rights?