The Canadian pressure group UBI Works is continuing its mission to demonstrate the benefits of basic income. The latest piece of work it has commissioned will research the benefits of the Canada Child Benefit.
The Canada Child Benefit offers a tax-free payment to eligible families with children under 18 years old, and according to UBI Works: “Over 1.2 million families are currently receiving an average of $680 per month which has already lifted 300,000 children out of poverty.” While the benefit has no strings attached, it could be disputed whether the Child Benefit can fully be considered a basic income given that applicants are assessed according to their income tax and benefit returns.
UBI Works is a coalition of Canadian business leaders, economists, artists, and other engaged Canadian citizens. Back in 2018, spurred by the heavily disputed cancellation of the Ontario Basic Income Pilot, UBI Works assembled 120 Canadian CEOs to declare their support for the Ontario Pilot.
The latest investigation joins three current pieces research commissioned by UBI Works – on the impact of UBI on the Candian economy; an investigation of different costing models for a national basic income, and a definition of a specific basic income policy for Canada.
Recent analysis of US proposals for a $1,000 a month basic income show it would have a dramatic effect on poverty and inequality, while also substantially increasing the US budget deficit.
Max Ghenis, a researcher at The UBI Center, explores the financial implications of Andrew Yang’s plans to give all US citizens a Freedom Dividend. Ghenis’ investigation shows that it would cost $2.8tn a year. Tax revenue and related changes to welfare costs would pay for around half of this, leaving a deficit of $1.4tn to make up the difference. This is considerably more than the current US deficit (just over $800bn in 2018).
Despite the lower economic growth caused by a larger deficit, Ghenis calculates significant benefits for nearly all citizens. Only those the wealthiest 10% (in terms of yearly disposable income) would suffer financial loss, and there would be marked increases in disposable income for the poorest 10%. Even median earners would receive over 20% extra disposable income.
Ghenis also discusses the potential economic benefits of Yang’s Freedom Dividend, comparing it with earlier studies on basic income in the US (such as the Penn-Wharton model and Roosevelt Institute study). He is sceptical of Yang’s claims that the Freedom Dividend would stimulate government by up to $900bn – with the implication that alternative strategies would need to be considered. In a related article, Ghenis proposes a deficit-free basic income of $471 a month that would not add to the US budget deficit.
Picture: Photo of Andrew Yang. Attribution: Collision Conf from New Orleans, Louisiana, USA [CC BY 2.0]
Johanna Perkiö, Doctoral Candidate, University of Tampere
A recent article on the Finnish basic income experiment has demonstrated how ‘framing’ the benefits of basic income in specific ways can make it acceptable to a wide political spectrum.
University of Tampere researcher Johanna Perkio has recently published an article examining how basic income has been perceived in Finnish political circle since the 1980s. Analysing party programmes and election manifestos, parliamentary motions and debates, and questions to ministers, she concludes that its take up within the current neo-liberal climate has been facilitated by seeing basic income as a way of dealing with economic problems of work and incentivisation.
Earlier debates, in the 1980s, emphasised notions of equal rights and fairness in employment. As more monetarist economic views began to dominate political thinking, basic income started being seen in terms of how it might incentivise the unemployed to find work. This was particularly true within political parties who were hesitant about supporting basic income.
Perkio also notes that the preliminary results from the Finnish experiment – which indicated that basic income led to increased well being amongst the recipients but did not necessarily help them find work – may mean that supporters of basic income need another frame to justify their support.
A blog post summarising the article is available online. The article itself is published by the Journal of Social Policy.