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Experts suggest giving Russians certificates for lost income
Alexander Galushka and Artur Niyazmetov formulated the mechanism of guaranteed certificates - the domestic analogue of the idea of an unconditional basic income
Photo: Elvira Kashapova / shutterstock.com
The June issue of Finance magazine (founded by the Russian Ministry of Finance) published the publication “On the mechanism of a guaranteed certificate” authored by Alexander Galushka and Artur Niyazmetov. Alexander Galushka (2013 - 2018 - Minister of the Russian Federation for the Development of the Far East) is currently the Deputy Secretary of the Public Chamber of the Russian Federation and a member of the Presidium of the Government Commission on Economic Development and Integration. Artur Niyazmetov is the Deputy Plenipotentiary Representative of the President of Russia in the Central Federal District, but he signed the publication as an assistant professor at the Department of Public Finance of the Financial University under the Government of the Russian Federation.
Messrs. Galushka and Niyazmetov raise in their publication the issue of unconditional basic income as an economic idea inherent in many developed countries, the relevance of which has only grown against the background of the crisis caused by the coronavirus pandemic. “… Discussions about the need for practical implementation of the concept of an unconditional basic income unfolded with renewed vigor. But if in recent years the key question in these discussions boiled down to how much in the future robotization and artificial intelligence will reduce the number of available jobs, now basic unconditional income has become a pressing issue of the present day. And it's not about robots, ”the authors note. The publication notes that the mechanism of unconditional basic income is promising in the context of economic recovery as a whole, as a tool for balancing supply and demand.
According to the authors of the publication, a guaranteed certificate can and should work transparently and without inflationary risks. To do this, the certificate itself must be individual and inalienable, it can be spent only by the owner and only on domestically produced products. Procurement management will be carried out centrally, by a single customer-supplier, which will provide the industry with large orders and achieve a discount to the market price. It was proposed to finance the model by the Central Bank of the Russian Federation at the expense of targeted emission in the amount of money supply, which in fact had already served the fallen consumption and production before the crisis. This approach will allow avoiding inflationary risks and focusing efforts on supporting domestic producers.
"Thus, there is a strictly targeted - for the release of goods and an exclusively non-inflationary channel for the formation of money supply, the size of which strictly corresponds to the created mass of goods," the authors of the publication say.
It is interesting that when determining the amount of the certificate that could be offered to the citizens of Russia, the authors of the publication urge not to skimp. "To restore the fallen consumption, people are given the right to receive a guaranteed certificate free of charge in the amount of income lost during the coronavirus pandemic," the article says.
Operationally, for the implementation of guaranteed certificates, Alexander Galushka and Artur Niyazmetov propose to use the existing system of state electronic services. In particular, the existing instruments of the federal tax system can accurately calculate the fact of a decrease in a citizen's income and automatically determine the amount of a guaranteed certificate. In turn, the portal of Public Services can provide user registration and certificate management. A special module in the form of an online platform (online store), which can be created in the ecosystem of the public services portal, will not only allow a citizen to choose goods from “available”, but also form so-called “wishes” - to order those goods that are not yet represented in the system.
The scheme of the guaranteed certificate (illustration from the magazine "Finance" No. 6 of 2020)
The authors of the publication first of all call the restoration of the balance of consumption and demand as the result of the model. Moreover, by fine-tuning the mechanisms, the system of guaranteed certificates can help to point-out the development of import substitution and bring certain areas of industrial production to levels exceeding pre-crisis levels. At the same time, the special value of the mechanism is that, thanks to financing through the Central Bank of the Russian Federation, the proposed mechanism allows solving problems of economic recovery without increasing the credit burden on business and the population. “Consequently, it does not create restrictions on economic growth in the future,” the authors of the publication note.
We remind that earlier Alexander Galushka and Artur Niyazmetov proposed another interesting economic instrument - target design emission using escrow accounts. We are talking about the formation of an instrument of monetary emissions of the Central Bank for the implementation of specific investment projects. Moreover, the key aspect of the proposed measure is its “non-inflationary nature” - according to the authors, today it is possible to create such a chain of money injections into the economy that the “printing press” will not accelerate inflation.