by Andre Coelho | Mar 15, 2017 | Opinion
A debate has arisen about the definition of basic income and the facts that support the movement. To contribute my input to the debate, I feel the need to respond, line by line, to Francine Mestrum’s latest article published on Social Europe.
It starts right at the top, with Mestrum equating basic income, professed in the Basic Income Earth Network (BIEN) Newsletter articles, with guaranteed minimum income. To justify this approach, she mentions the fact that no basic income has ever been implemented, and that the pilots concerned transferred cash only to poor people. Although her view is understandable, she fails to see that these pilots intended to test the outcome of a basic income implementation (which effectively transfers income from the relatively richer to the relatively poorer). It’s not that in a future basic income implementation rich people will not get it (as opposed to the Negative Income Tax approach); universality implies they also get it, but then all of the basic income and more is taken away, through taxation. That’s redistribution functioning.
We already see that in our current welfare states, but in twisted, unfair and inefficient ways. The conditionalities associated with present-day social security are creating poverty traps all around, so the unconditionality associated with basic income is intended to eliminate them. However, and as a matter of fact, her reference to the Canadian basic income experiment at Dauphin is misplaced, since Dauphin was actually an experimental saturation site, which means that everyone in the town was eligible for the cash. The income monitoring and distribution simulated the taxation effect (only positive transfers for the relatively poor).
Then, Mestrum goes on to say that current basic income experimental plans in the Netherlands, Finland and Scotland “can threaten social protection mechanisms”. Well, we in the basic income movement have already heard enough about the possibility of basic income being highjacked by right-wing neo-liberals threatening to dismantle social protection mechanisms (and much more) with the introduction of a basic income. I can hear them say, between the lines: “Here’s free money to everyone! Now get out of our faces and let us dismantle everything in existence publicly owned or managed.” Of course there’s a risk. I’m not denying it. However, any person who is aware will not be fooled by such intentions. I, among many other basic income defenders (most of them, actually), support a basic income which is complementary to the welfare state, not a substitution for it. Louise Haagh makes a very good case for this defense, as expressed here.
Then the questions. According to Francine, the only serious questions worth answering on basic income are whether income distribution schemes, like in Alaska, should be limited to resource-rich regions, and whether there shouldn’t be a global fund (linked to resources from all regions) to cover global needs. These are important questions, no doubt. But hardly the only serious ones. How about, “Should not all people enjoy a minimum amount of freedom in their lives, instead of being pressured and exploited all the time?”, or “Should not countries and their governments make efforts to reduce structural inequalities, which are seen as the source for countless social problems?”, or even “Should not countries introduce a way to guarantee basic financial security for all, as a way to effectively deal with the changing nature of work, precariousness and automation?”. My view is that Francine Mestrum nurtures a very narrow view on what is and what is not meant to be a basic income.
As for semantics, notably the “basic income” vs “minimum income” discussion in France, I do have not much to say. However, if we limit ourselves to a pure language discussion, note that “basic income” can mean anything from the most abject dictatorial sanctions-based system (as in present-day United Kingdom) of social assistance, to the most progressive, avant-garde unconditional system of cash transfers. Once each one of us explains what he/she understands these terms to be, there should be no confusion left.
Next, Mestrum identifies BIEN as a source of the problem, to be held responsible for these disputes in language (which she inelegantly calls “communicating on alternative facts”). This is unfair. More precisely, it is unfair because it stems from a misunderstanding of the mission of BI News. BIEN’s Newsletter is a collection of articles from Basic Income News for a given month. These articles convey information about what is happening around the world concerning basic income, and an article about the alleged confusion between “basic income” and “minimum income” would actually be a good candidate for Basic Income News. Articles can report news from someone defending basic income, or somebody else critiquing it (as Francine Mestrum does). Events and other publications on the Internet are also frequently highlighted byBasic Income News. What is posted on Basic Income News does not necessarily convey BIEN’s views on basic income. Instead, for that end, a short, general definition is available on BIEN’s website. There can be absolutely no mistake here.
Another thing has to be perfectly clear. As a BIEN member, and Basic Income News editor-in-chief, my role is not to speak for the minds of other people, even when they are confusing “basic income” with “minimum income”. Basic Income News is expected to be an impartial news service, aiming nonetheless to disseminate information about basic income. Interested readers will take their time to digest all this information, to think and to draw their own conclusions. Here I resort to a line I normally use in these situations: no one convinces no one, only the individual becomes self-convinced. Now, for that, of course, one must be in possession of enough information. And that’s where we, at Basic Income News, step in.
Understandably, Francine Mestrum has a deep rooted fear that basic income implementation will lead to the collapse of the welfare state and, with it, all the hard won social conquests, such as public education and public health and, of course, democracy. We are all too weary of the effects of the rentier capitalist economy thriving these days, chief among them the erosion of democracy. But Francine’s fears are not against basic income. These are against, as she herself puts it, “those who do not believe in society”. And that’s why all true defenders of a social basic income, the one that promotes solidarity, complements the welfare state and recognises the commons, must do exactly that: promote solidarity, defend the welfare state (while improving it) and help expand the commons.
Otherwise, I must agree with Francine: our society will inevitably decay into a dystopia of unbelievable proportions, destruction of the environment and exploitation of the people.
More information at:
Francine Mestrum, “The alternative facts of the basic income movement”, Social Europe, 16th February 2017
by Andre Coelho | Mar 3, 2017 | News
On February 6th Paulo Pinto published a podcast on basic income for the Portuguese radio station Rádio Renascença. Motivated by the recent growth in interest for what is often considered the “radical project” of basic income in Finland, Paulo Pinto condenses all the available information about basic income and shortly interviews André Coelho, Basic Income News’s lead-editor and activist.
After presenting a possible definition of basic income, André cites a couple of problems related to the Finish experiment, namely the quantity disbursed to individuals not covering basic expenses in the Finish context, and only unemployed people participating in the experiment. He also clarifies that many criticisms are covert manifestations of lack of trust in people, who allegedly cannot be trusted with unconditional money.
Listen to the full conversation:
(Language: Portuguese)
Paulo Pinto, “Dinheiro grátis [Free money]”, Rádio Renascença – Economia das coisas, 6th February 2017
by Andre Coelho | Mar 1, 2017 | News
(Bruna Augusto)
Marcus Brancaglione has written yet another book about basic income. Marcus, a brazilian author with more than ten edited books and founder of the Recivitas NGO in Brazil, has compiled libertarian arguments from four of his other books in this new 445 page book.
As a way of spreading the book’s message, Bruna Augusto, president of Recivitas, and Marcus longtime partner, is posting on Youtube a series of videos related to the book (example here). These videos will be exactly 209 in number, and each contains a short paragraph of the book (one of the “reasons”). The purpose is also to ask people to translate into other languages these short videos, in a collaborative effort to get the book translated.
Inside the book, reason 22 – “propaganda” – can be read:
“While this political-economic system is maintained not just through forced labor, but from the use of human beings in all kinds of services and experiments: military, pharmaceutical, academic and social; while we accept that our income comes from reducing other people to human resources, forced, openly or covertly, to give way their freedom and sell their bodies in exchange for cash, basic income will face ridicule, denial and even hatred.”
Original book (in Brazilian Portuguese):
Marcus Brancaglione, “209 razões para ter fé na renda básica [209 reasons to have faith on basic income]”, N Razões, Brazil, 2016
by Andre Coelho | Feb 18, 2017 | News
(From left to right: Louise Haagh, Annie Miller, Becca Kirkpatrick, Ben Southwood)
As reported recently, a formal hearing called by the Work and Pensions Committee of the UK Parliament was carried out on the 12th of January 2017, in Birmingham, for a session dedicated to basic income. This hearing was recorded on video, and can be watched here.
From the Work and Pensions Committee, the members present (formally named as witnesses) were Steve McCabe (Chair), Mhari Black, Ms Karen Buck, James Cartlidge, Frank Field and Craig Mackinlay. On the witness bench, supporters and critics of basic income were aligned: Louise Haagh (Reader in Politics from the University of York and co-chair of the Basic Income Earth Network), Annie Miller (Chair of the Citizen’s Income Trust), Becca Kirkpatrick (Chair of the UNISON West Midlands Community Branch), Ben Southwood (Head of Research at the Adam Smith Institute) and Andrew Harrop (General Secretary of the Fabian Society) on the supporting side, along with Declan Gaffney (independent political consultant) and Peter Alcock (Emeritus Professor of Social Polity and Administration at the University of Birmingham) on the critical side.
The purpose of the hearing was one of collecting evidence from experts, specifically on the issue of basic income, on which Chairman Steve McCabe noted there seemed to be a “newfound interest”. He then went on to ask whether the witnesses were for or against the idea of basic income, and why, beginning with Louise Haagh.
Louise is firmly in favor of basic income, which she sees as a very important – crucial even – policy that welfare states need to implement, in order to relieve what she regards as a tendency towards more punitive strategies in present day social security schemes. Basic income can help a lot in providing “a more humane form of social security at the bottom of the welfare state”.
Louise Haagh
Seated next to Louise, Annie Miller starts by undersigning all her previous statements. In addition, she points to some definitional information about basic income, such as individuality, universality and non-conditionality except that of age. Miller also clarifies that basic income is only intended to cover basic needs, not luxurious lifestyles. That implies, given regional cost variations and various personal circumstances, that for instance housing and disability benefits would still need to be kept in place, at least in the United Kingdom (UK). She closes this initial statement by saying that basic income schemes will vary depending on the policy maker’s objectives.
Becca Kirkpatrick also began with her support for basic income, including the UNISON West Midlands labor union in that support. She cites ongoing discussions about basic income within the union she represents, which include a right to a dignified existence, as unconditional cash transfer, or as more widely conceived strategies to eradicate or alleviate poverty. Becca frames the question more generally not on a matter of technical or economic feasibility, but as an issue of political will, on “what the public of this country would like to see and believe they are entitled to”.
Following this, Ben Southwood went on to say that, although he supports basic income, he stands somewhere slightly different in relation to the issue. He defends basic income as a simplification of the welfare state, where he sees great opportunity for reducing or eliminating disincentives to work. Cutting most social benefits and replacing them with the basic income would, in his view, allow people currently on benefits a greater degree of freedom.
Annie Miller
On his part, Peter Alcock, while recognizing basic income’s appeal as a progressive idea for society, feels that it is “too good to be true”. Afraid of the co-option of basic income by neo-liberals – as an excuse for slashing away the welfare state – he looks upon it with as a “distraction from other more pressing issues”. He was followed, and supported by, Declan Gaffney. He was also weary that basic income supporters so often defend BI with promises of unconditionality even when, when practically considered, a basic income would still need to be attached to conditions. However, he does give the idea credit as “a thought experiment”.
Finally, Andrew Harrop said he was “sitting on the fence” with basic income. He thinks basic income should be seen more from a tax reform prism, rather than a change to social security. Harrop ultimately envisions a kind of hybrid system that combines universal unconditional cash transfers with means tested benefits for those “who have earned entitlement”.
Ms Karen Buck then raised the question of work and basic income: in an increasingly unstable labor market, with lower and less certain incomes accruing from work – how serious should these tendencies be regarded, and how might basic income address them? Declan Gaffney, in reply, doubted that, given the previous economic instability, we were witnessing permanent job loss due to technological change. In this he adhered to the views of others like Alan Manning. This was followed by a short discussion between Ms Karen Buck and Becca Kirkpatrick, over if the problem was the existence of conditions within the system, or the absence of the system. According to Becca, the system does not exist, not in a way as to “prioritize guaranteeing for everyone”, and went on to state the premises and broad results of UNISON internal debate on the issue of basic income. That survey, she says, has exceeded expectations as to the level of support for the idea, in general terms.
At that point, James Cartlidge joins the conversation, asking what he thinks is “the most important question”: how generous will this basic income be? Ben Southwood then introduces the issue of basic income versus the negative income tax issue. After clarification of the differences between these two systems of cash transfer, Annie Miller points out that the “housing benefit is not a problem of the basic income, it is a problem of the housing policy”. However, James, and to a certain extent, Peter Alcock state their opposition to basic income on a more fundamental basis: that people will not work if given a sufficiently generous basic income. James Cartlidge is also not convinced (about basic income), as some models, according to him, result in greater poverty with basic income.
Mhairi Black then raises the question of effects on the labor market, which she fears will be one without pay raises, if basic income is implemented. Louise doesn’t agree, arguing that people, with increased bargaining power, will only do difficult, unpleasant tasks if paid more to do them. On the other hand, going back to the quantitative value of basic income, Annie Miller reminds that 60% of the median equivalized household income is a good benchmark for quantifying the basic income in any given region, and elucidates about ways to finance it within the UK tax context. She goes on to state that this should actually be inscribed into a national constitution, if only the UK had one. On that point, Andrew Harrop states his preference for a hybrid tiered system, with both conditional and unconditional elements in it, plus some contributory part (for pensions and/or unemployment benefits).
Becca Kirkpatrick then introduced the issue of working conditions – on a general basis but also based on her own experience – which she thinks need to be addressed urgently, and strongly believes basic income is the way to do it. Louise then weights in by underlining that a basic income does not need to be a substitute for work regulations, nor to contributory benefit regimes. The two can go along in the same direction, one of reducing conditionality, complexity and punitive actions.
Craig Mackinlay from the Work and Pensions Committee was himself generally against the idea of a basic income, especially on the grounds that it will discourage work, plus it could increase poverty. Declan Gaffney, although also an opponent, recalls a study for the USA in which a 55% tax rate is applied to fund a basic income. Ben Southwood, on work changes due to basic income, sees a mixed effect which might somewhat reduce working hours – especially for single women with children – but at the same time increase income for extra hours worked. At this point, Louise introduces the calculations done by Malcom Torry, of the Citizen’s Income Trust, to fund a basic income in the UK, which predicts a 60£ a week for everybody, financed by progressive tax rates of 23% for incomes up to 42000£ per year, 43% up to 150000£ per year and 48% above that.
Peter Alcock
As final remarks, Andrew Harrop re-stated his vision of a hybrid social security scheme incorporating conditional and unconditional parcels. Declan declared himself reluctant to accept conditionality in the social security system, as well as some backstop sanctions regime. However, because he thinks basic income will discourage people from working, he favors a more traditional employment framework, with “permanent contracts, with proper in-work benefits with entitlements to holiday pay, sick pay and so on”. Peter Alcock firmly set his case against basic income, as something unachievable or that “isn’t worth pursuing”. Ben also concluded in support of basic income, although from a different point of view from other supporters. According to him, there is no principle distinction between a basic income and a negative income tax.
Becca Kirkpatrick went back to fundamental philosophical grounds justifying basic income, by saying that it “could have an interestingly powerful, new cohesive effect on society that we are yet to really experience”. She also rested her case with a unifying message that, effectively, the human species needs badly to unite, helped by such a policy as basic income, to address all other challenges it is facing in the world today. Annie Miller wrapped up her position by clarifying that, under a basic income scheme, higher earners are net payers of basic income, not receivers. She also added the important aspect of gender inequality, so much in favor of men presently, and that would be made more fair and realistic with basic income, paid individually. She still had time to summarize the current system, which she claimed is “just a regressive system”, and went on to point out that “we have freedom of choice for rich people but not for poor people”. Finally, Louise Haagh presented her closing statement underlying that, although with different views on the subject, the whole witness panel seems to show consensus that the benefits system needs changing. And that change will inevitably go towards basic income, if it is to become less punitive and more humane.
To view the full recording:
House of Commons Committees Youtube Channel, “Session on Citizen’s Income”, Work and Pensions Committee, live streamlined on the 12th January 2017
by Andre Coelho | Feb 8, 2017 | News
Mayor Lee Jae-myung. Credit to: Pangyo Techno Valley.
On December 9, 2016, the National Assembly of the Republic of Korea voted to impeach Park Geun-hye over a corruption scandal with her lifelong friend Choi Soon-sil. Due to the impeachment, the next presidential election in Korea is expected to take place early, in April or May 2017 instead of December, 2017. As the details of the scandal have emerged, a previously less well-known presidential candidate has been rising in opinion polls – Lee Jae-myung, the current mayor of Seongnam city. This city is located to the southeast of Seoul and is one of many municipalities of the Gyeonggi province.
In two months, Mayor Lee has emerged as a so-called “dark horse” candidate with a poll approval rating of 18%. He has been ranked as the third most popular of the presidential candidates. The strongest driving force of his rise is attributed to his prompt action in advocating for the impeachment of President Park. He was the first among the presidential candidates to call on the National Assembly to impeach Park Geun-hye. Lee is also famous for his clear stance against powerful vested interests, including the “ in Korea.
Yet, there is another important factor that grabs attention. His major campaign promise is about providing universal basic income. Mayor Lee has successfully implemented the youth dividend policy, which pays an annual dividend of one million Korean won (approximately 850 US dollars) to individuals who are 24 years of age and who have lived in Seongnam city for three years or more. The policy finds its philosophical roots in the idea of universal basic income. The Park Geun-hye administration used several strategies to deter the implementation of the local youth dividend policy, however, Mayor Lee eventually fulfilled his promise.
A survey of 2866 youth distribution recipients shows that 96.3% of youth who received the benefit are satisfied with the policy. Some responses revealing satisfaction and even gratitude include the following: “Upon receiving the youth credit, I have gained confidence, which is more valuable than money”; and “Society looked after me for the first time”.
In his presidential candidacy announcement speech for the 19th Election, Lee Jae-myung said he will expand the universal basic income system to the national level. More specifically, he outlined a detailed plan to provide the ‘life-cycle dividend’ and ‘special dividend’ shortly after his inauguration.
The life-cycle dividend will pay a child dividend to individuals aged between 0 and 12, a teen dividend to those in the 13-18 bracket, a youth dividend to 19-29-year old, and an elderly dividend to individuals who are 65 or older. The special dividend is aimed at specific populations, such as farmers, fishermen and people with disabilities. The amount of the annual dividend is set at one million Korean won per person (874 US$/person), regardless of the kind of dividend. Lee explained that he finds it feasible to allocate 28 trillion won, which accounts for about 7% of the total budget, to the dividend policy by tightening central government spending.
Lee Jae-myung. Credit to: Bloomberg / Getty Images
Moreover, Mayor Lee has also promised that he will secure a total of 15.5 trillion Korean won (13.6 billion US$) by establishing a new ‘land holding tax’. He argues that the revenue from the land holding tax should be used as a source of a land dividend, which provides an annual dividend of 300,000 won (approximately 255 US dollars) to all citizens of the Republic of Korea. Not only can this tax collect a portion of all rents from real estate publically, it can also help realize the idea of universal basic income. Lee firmly believes that land is a common property for all citizens.
In fact, the Republic of Korea is a country that appreciates the ‘publicness’ of land. The Constitution of the Republic of Korea states, in Article 122, that “The State can fulfill necessary restrictions and obligations related to the efficient and balanced use, development, and preservation of land, which is the basis of production and living of all citizens.” In the past, when the government has attempted to implement policies in the spirit of this clause, the country has witnessed numerous attacks from powerful vested interests, the so-called “top 1%”. Most of the time, the government has thus had to withdraw from such policies. However, Lee Jae-myung is seen as a well-equipped candidate with the ability and courage to fight against the powerful elites in Korea and successfully implement this policy.
Mayor Lee’s ideas about basic income
Lee Jae-myung’s basic income policy combines two ideas of basic income theory: 1) the state is responsible for ensuring the de facto freedom of all citizens; and 2) land, natural resources, the environment, and knowledge are common property that must be shared by all members of society. On these grounds, his basic income policy is thought to have positive prospects and much room for growth, particularly in terms of the payout amount. Thus, proponents of universal basic income around the world should pay attention to Lee Jae-myung in Korea.
If Mayor Lee is elected as the next president of the Republic of Korea and successfully fulfills his campaign promise on basic income policy, he would be able to address many problems currently undermining Korean society, such as income and wealth inequalities, unfair competition, and real estate speculation. Then, Korea might be able to follow a path of inclusive growth, which will eventually lead to a fair and equal society.
About the author:
Gangsoo Jun is a professor of economy at the Catholic University of Daegu, South Korea, and is involved in Lee Jae-Myung policymaking team.
More information at:
Language: Korean
Se-young Lee, “전국민에 연간 130만원 … – 이재명 ‘기본소득 마케팅’ [Annual Dividend of 1,300,000 won to All Citizens … – Lee Jae-Myung ‘Basic Income Marketing’]”, The Hankyoreh, 18 January, 2017.
Language: English
Kang Jin-Kyu, “Seongnam mayor declares presidential bid”, Korea JoongAng Daily, 24 January, 2017.
Hyosang Ahn, “SOUTH KOREA: Seongnam City announced to implement ‘Youth Dividend’”, Basic Income News, 7 October, 2015.
Toru Yamamori, “SOUTH KOREA: Mayor of Seongnam City talks on his plan for ‘Youth Dividend’”, Basic Income News, 15 September, 2015.
