Two interesting debates are being led simultaneously in Slovakia. One on subsidies to support the mining of lignite in the upper Nitra region and the other on the unconditional basic income for all. The interconnection between the two could bring so many positive effects that I am left to wonder why nobody has thought of this so far.
Subsidies are a thorny issue for many. The list of those people is long and diverse as well as the reasons for their critique. Businesses do not like the form in which financial support is being provided – reflected in higher electricity prices. Greenpeace points out that subsidized production artificially and unnecessarily prolongs the pollution of regional environment.
Meanwhile, Brussels is examining whether the support provided is in accordance with European rules. An average household will pay an annual price of EUR 11 for the complete shutdown of mining operations while the political opposition will not let the opportunity slip away to give the government a hard time.
The government-founded Institute of Financial Policy surprisingly joined the ranks of the critics in 2011. The Institute’s analysts calculated that the monthly governmental support of a miner is higher than his salary. Back then, subsidies amounted to nearly EUR 1,800 per miner while his income was EUR 700 lower.
This riddle also represents a ray of hope for an interesting solution, to be potentially found in the concept of the unconditional basic income. This particular discussion, which has recently reached the shores of our homeland, had already been dividing theorists all over the world for years.
Meanwhile, many states have begun experiments with time limits and territorial constraints. The issue of mines in upper Nitra is an ideal opportunity to join the cavalry of experimenters. The mines currently employ roughly 4,000 people while the government spends close to EUR 100 million per year to sustain these jobs. The executive branch has also declared its intention to keep this support alive until 2030. What if we replaced this system by a better and more effective mechanism? What if the government pledged to pay the miners an unconditional income (i.e. EUR 1,000) during their economically active life period until 2030?
This would cost us less and we could save up to tens of millions of euros per year, when compared to today’s costs. But saving money and cutting costs is just one of the many positive effects this measure could bring. The government would manage to untie itself from an uncomfortable defensive position because the people would be protected. There is also a potential for the opposition to be less critical of the proposed solution, as it would contain tangibly fewer deformations. The problem would lose its political charge.
Of course, we do not know yet how the miners would actually deal with their suddenly acquired freedom but we do know for certain that they would no longer be chained to unpromising jobs without future perspective, a reliance that is only reinforced by the scheme of subsidies currently in place. Unconditional income paid until 2030 would grant them the freedom to decide for themselves without any existential stress or crisis. At the same time Slovakia would gain the reputation of a bold experimenter and we would solve the problem that had been “solved” so poorly that it has hardly pleased anyone.
Translated by Adam Štrauch