by Guest Contributor | Jun 29, 2018 | Opinion
Written by: Leah Hamilton, MSW, PhD
Democrats and Republicans don’t see eye to eye very often, but they can safely agree on one point: welfare doesn’t work. Liberals are concerned that an ever-shrinking social safety net reaches fewer and fewer families in need. Republicans worry that welfare benefits create dependence. They are both right.
The primary cash assistance program in the United States, Temporary Assistance to Needy Families, served 68% of low-income families in 1996. Today, only 23% of poor families receive assistance. This change has been largely brought about by the imposition of five-year lifetime limits (states are allowed to set lower limits) and stricter eligibility criteria. Welfare caseload reductions have been solidly linked to the rise of deep poverty in America, family strain and increased foster care placements. 1.46 million US households (including 2.8 million children) now live on less than $2 per person, per day (the World Bank’s measurement of extreme poverty).
Meanwhile, welfare eligibility rules designed to encourage independence have achieved the opposite effect. For example, though many states impose strict work requirements, states which loosen these rules actually see recipients move to higher wage, higher benefit work, presumably because they have the breathing room to search for a good job rather than take the first one that comes along. Similarly, in states with strict limitations on recipient assets, poor families are less likely to own a car, making it nearly impossible to maintain employment in areas without public transportation. Even worse, some researchers are discovering a “cliff effect” in which welfare recipients immediately lose all benefits (including child care assistance) after a small increase in income. As a result, many parents turn down promotional opportunities because they would be ultimately worse off financially. Any parent would make the same decision if it meant the ability to feed their children and afford quality childcare.
We must redesign this entire system. In the most prosperous nation in the world, it is ludicrous that children are growing up in the kind of deprivation we normally associate with developing countries. Simultaneously, we must ensure that no one is discouraged from growing their income or assets. One potential solution is a universal basic income, which would provide an annual benefit to every citizen. However, this idea comes with a hefty price tag and would either increase our national deficit or increase the marginal tax rate, both of which might be political non-starters. The simpler solution is a Negative Income Tax (NIT) which is potentially cheaper than our current poverty alleviation efforts. An NIT is a refundable tax credit which brings every household to the federal poverty level. The most effective way to do this is to decrease the credit slowly (for example, a $0.50 reduction for each $1.00 increase in earned income) so that there is never a penalty for hard work.
Researchers at the University of Michigan calculated what this might look like in practice. If a family had no income, their tax credit would be 100% of the poverty line ($20,780 for a family of three). If the family’s earned income increased to half the poverty line ($10,390), their tax credit would decrease to $15,585. The credit would phase out completely once the family’s income reached twice the poverty level ($41,560). This plan would cost roughly $219 billion per year and could be almost completely paid for by replacing most or all of our current poverty programs.
With this one simple policy, we can achieve many goals of both the left and right. Poverty would be eliminated overnight. Work disincentives would be removed. American bureaucracy would be significantly reduced. Families would be free to make financial decisions without government intrusion. And in the long run, we would save money. Childhood poverty alone costs the US $1.03 trillion (yes, trillion) per year. In the 21st century, eradicating poverty isn’t complicated. We’re just going about it in the worst possible way.
About the author:
Leah Hamilton, MSW, PhD is an Assistant Professor of Social Work at Appalachian State University. She received a BSW from Metropolitan State University of Denver, an MSW from the University of Denver and a PhD in Public Policy at the University of Arkansas. She served as a Foster Care Case Worker and trainer for five years in Denver, Colorado. Dr. Hamilton’s research interests include poverty, economic justice, and social policy.
by Guest Contributor | Jun 15, 2018 | Opinion
Written by: Thomas Klemm
Some indigenous nations within the United States may have answers to many of the biggest questions of basic income, due to their experience with basic income-like programs. Nations have been doing this in the form of what is commonly known as “per capita” payments. While per capita payments pre-date casino gaming, the majority of per capita payment programs came after passing The Indian Gaming Regulatory Act (IGRA), which was passed in 1988. Traditionally, casinos have been a massive source of income and revenue for the Indian community. However, the online casino market has slowly resulted in revenue dropping substantially. The simple reason for this is Casinos not on gamstop have proven to be very popular.
These per capita payments commonly come from the allocation of casino revenue. Anyone who has installed the mega888 download will be well aware of how lucrative the casino market is at the moment. If you haven’t downloaded it, or at least something similar, you are potentially missing out on some big winnings. Just remember to check a review first, before you decide on an online casino or casino app. You don’t want to deposit any money into it unless you can be sure it is a good site to use. The market in general is booming, be it with the in-person locations with the glitz and glamor, or with the online sites that allow for fast withdrawal of those shiny winnings. Moreover, it should be stated that other business ventures are used to fund these payments as well. How successful these ventures are is often dependent on how close to a large population the nation is. Being that most indigenous people were forcibly moved to some of the most isolated and rural parts of this country, it makes successful gaming a near impossibility for most tribal nations. Due to this, the size and frequency of per capita payments vary greatly among nations, with some being negligible, some being partial basic incomes, and some being full basic incomes. Some stipends are given bi-weekly, monthly, bi-annually and annually. Attitudes vary greatly as well, with each indigenous person having their own personal experience with this topic. Stereotypes about all Native Americans being casino-rich and or getting “government checks” are still pervasive and harmful. It is important to note that though some growth has occurred, Native Americans were the poorest racial demographic before IGRA and are still today the poorest.
I am certainly not the first person to make the connection that these stipends are a form of basic income. The Eastern Band of Cherokee per capita program has been researched extensively, yielding incredible results. While there is an academic angle to take in terms of researching per capita programs, more importantly, a dialogue needs to be started between the UBI community and indigenous nations. This means reaching out to indigenous nations’ leaders and citizens. Indigenous researchers should be at the front of these efforts. If one is interested in this topic and cannot think of any indigenous researchers to consult or lead these efforts, it is necessary for a closer examination of why that is the case.
While there are some indigenous people I know who think these have been positive and successful programs, there are some who feel differently. There are vastly more indigenous people I have not met with their own unique and valid perspective on this subject. While some may be open as the Eastern Band of Cherokee to this type of research, some may not be interested. It is a nation’s sovereign right to keep information about their per capita system private and any refusal to participate in research efforts by outside entities should be respected.
Nations that implement these programs are not labs, and their citizens are not research subjects. These nations are examples of a different way of doing things. The citizens are leading experts in UBI by way of experience. Community leaders know what these programs have done to their communities for better or worse. The discussion of implementing a basic income is incomplete without the indigenous voice and experience as a central component to the conversation.
About the author: Thomas Klemm is a citizen of the Pokagon Band of Potawatomi Indians. He currently lives in Ann Arbor MI, where he is a BSW candidate at Eastern Michigan University and works at Dawn Farm Inc. as a Recovery Support Specialist. Thomas has hopes of continuing his education at the graduate level.
URL’s in order of appearance:
https://mvskokemedia.com/what-are-per-capita-payments/
https://www.nigc.gov/general-counsel/indian-gaming-regulatory-act
https://www.aeaweb.org/research/has-tribal-gaming-been-a-boon-for-American-Indians.php
https://newsmaven.io/indiancountrytoday/archive/tribal-per-capitas-and-self-termination-pWhjlw0iU0SYhqUcK4dw3Q/
https://newsmaven.io/indiancountrytoday/archive/the-myth-of-indian-casino-riches-3H8eP-wHX0Wz0H4WnQjwjA/
https://pubs.aeaweb.org/doi/pdf/10.1257/jep.29.3.185
https://www.census.gov/prod/2013pubs/acsbr11-17.pdf
https://www.wired.com/story/free-money-the-surprising-effects-of-a-basic-income-supplied-by-government/
https://indigenouseducationtools.org/assets/primaryimages/IET05_ThePromiseofIndigenousResearchIssue5_10.1.15.pdf
https://www.chronicle.com/article/Why-So-Few-American-Indians/146715
by Guest Contributor | May 28, 2018 | Opinion
A step to a future of solidarity and sharing
For hundreds of thousands of years, men and women lived in tribal groups, practicing mutual cooperation and solidarity. In the present we live in capitalism, competing among ourselves, driven by individual ambitions to ‘have’. This is not doing us any good. However, we can see it as a painful but necessary civilizational phase, a means of developing the capacity to produce all that’s necessary for the material life of all. The age of capitalism has only lasted 200 years. A better future could be drawn with the re-establishment of an economy of solidarity between people. We propose a process of systematic, automatic and unconditional transfers of money between people, from those who have more to those who have less. We call it Unconditional Basic Income of All for All, or ‘UBI-AA’.
The Past – from Ancestral Economy to Capitalism
Human societies in which all men and women have lived on Earth since people here exist, and until the formation of the first sophisticated civilizations, were tribal groups. They functioned through cooperation and solidarity between their members in tasks such as obtaining and distributing food, building shelters and family dwellings or taking care of community assets; tasks that today we would call ‘economic’. In fact, over hundreds of thousands of years of human presence on Earth the whole economy was cooperative and supportive. And it was sustainable then.
After the emergence of the first sophisticated civilizations and empires – about 6,000 years ago – things began to change, and the forms of economic organization put into practice came to vary from then. Today, however, all the economic diversity that has existed over those 6,000 years is virtually nullified, and a unique model has once again consolidated. It is called capitalism, and it has been going on for about 200 years.
While the ancestral economic mode was based on solidarity and cooperation between people, on a harmony between them and nature and on an orientation towards the mere satisfaction of their needs, capitalism is characterized by competition among peers, by the predation of the Earth and by an orientation of its agents towards unlimited material accumulation. Both models are hegemonic, each in its own time. But that’s all they have in common; as for everything else, it is difficult to find more opposing realities.
Can, like its ancestral homologous form, also this present ‘state of the art’ in economic organization – capitalism – last for hundreds of thousands of years? It doesn’t seem possible, given the condition in which it left us humans, and the planet, after only 200 years. And yet, despite its deeply dark sides, an important merit can be attributed to capitalism: with the demand for accumulation and profit it gave us machinery, techniques and knowledge that can now allow us to have the resources for the material comfort of all. This is only a possibility and not inevitable because although these machines, techniques and knowledge give us the capacity, they alone do not guarantee that we will use it. However, capitalism cannot possibly make any sense in history unless the immense price it charged and still charges us eventually results in the actual extinction of the material scarcity from the face of the Earth. Only then will it be seen as a process of rising human civilization to a higher level, albeit with great suffering.
Thus, the great question of the present is how to accomplish the potential that capitalism offers us, to free ourselves from the ‘fatality’ of material scarcity. The simple progress of the economy, as we have it, does not seem to be the way. Reality shows us very clearly that the mere growth, without any change or innovation in the logic and processes of the present economy, will never raise the condition of all, although it may greatly improve it for some people. Neither the strengthening of the so-called welfare state, in its traditional, bureaucratic, expensive and life-controlling form, can do more than mitigate poverty. Traditional welfare will never eliminate poverty and it charges from its beneficiaries a price in dignity and in humanity that the more unnecessary it becomes, the more intolerable it gets.
No, capitalism does not inherently have a mechanism to guarantee essentials for all. Let us resurrect from our ancestral economic way its essential element: solidarity among people.
A Future – the UBI-AA
Solidarity among people is the essential idea of the alternative distribution model of the resources generated in society we will talk about here: the Unconditional Basic Income of All for All, or ‘UBI-AA’.
To show what it is and how it works we will turn here to an explanation given elsewhere:
The UBI-AA is a revenue redistribution process designed to operate monthly, providing automatic and unconditional transfers among citizens, from those who have higher incomes to those with low or no income at all. Built, supported and leveraged by them, the process will invite the participants to take responsibility and engage in their communities, which will reinforce them.
It works in two stages:
1) As it is acquired, each member of the community discounts to a common fund – a ‘UBI Fund’ – a proportion of their income, at a single and universal rate;
2) At the end of each month, the Fund’s accumulated total is equally and unconditionally distributed by all members of the same community.
This simple process of treating everyone equally puts those who in each moment have above-average incomes to deliver to the UBI Fund more than they receive from it, and those who have below-average incomes would receive more. Thus, the process operates a joint distribution between the participants of part of their individual incomes. In addition, to reduce inequalities between them, this solidarity between peers creates an unconditional guarantee of income for all, that is, an Unconditional Basic Income.
It follows from the action of the UBI-AA process the loss of available income by some and its gain by others. For those who lose money, it is important to limit the loss, while maximizing the gain for the rest to ensure broad acceptance of the policy.
The demand for this double result should not, however, mean a devaluation of the possibilities of mutability of all individual positions. With the passage of time and with the exercise of the options that the process itself will open to the participants, the situations of income “winners” or “losers”, in which each of them will at each moment be, should always be seen as circumstantial.
To make possible its intended effects, the implementation of the UBI-AA should be accompanied by the release of its participants from the burden of personal income tax. Such tax relief will compensate them for the contributory effort required by the UBI-AA process, although, for those above a certain level of income, such compensation may turn out to be merely partial.
Abolished the personal income tax, the moderation of loss for citizens with higher incomes and, at the same time, the material significance of the gains to those in the opposite condition, will be possible if the rate of contributions to the UBI Fund is set at an optimal level, balancing the two outcomes. [1]
A more complete description of the UBI-AA process, as well as a simulation of the financial effects it would have produced, both in individual citizen spheres and in the State budget, hypothesizing it in force in Portugal in 2012, can be seen here.
UBI-AA differs from most of the traditional redistributive processes in operation because it is unconditional; and from most of the unconditional alternative processes for being a construction of common citizens instead of the policy of a government, a central bank or any other ‘power’.
What is proposed with the UBI-AA is not directly the creation of an unconditional guarantee of income for all. The proposal is the institution of an alternative form of organization of the economy in its distributive side. This will be accomplished with the income distribution process described above; a process that will favor the rehabilitation of values such as solidarity and voluntary cooperation between people, and of which the creation of an unconditional guarantee of income for all will be a corollary.
We hope that may contribute to the flourishing of a new culture, less marked by the centrality of material goods. Who knows if making everybody’s access to essential material resources as simple as the possibility of breathing, will not end up instilling in us the same attitude towards those resources – money and things it buys – as that we have towards the air we inspire: no matter how valuable it may be to us, we do not quarrel with each other for it; we use the quantities we need. Accumulating it would no longer be necessary.
Such cultural shift would certainly be a great step forward for us, human beings, and very good news for Earth.
[1] This stretch is an English translation from Projeto de um RBI – Local – Solidário – Voluntário, [Project of an UBI – Local – Supportive – Voluntary], by Miguel Horta, 2017, available (in Portuguese) from: https://pt.scribd.com/document/341205904/Projecto-RBI-Local-V-2017.
Written by Miguel Horta
by Guest Contributor | May 26, 2018 | News
Scott Santens published on Medium the transcription of a speech he wrote for a keynote session he presented in Sweden in 2017, with the title “It’s time for technology to serve all humankind with Unconditional Basic Income.”
The speech revolves around the impact of automation on society, acting as a disruptor in the labour market, making many jobs obsolete without creating more and better jobs for humans. This is a trend that goes on since the ‘90s: “Yes, it already happened. It’s not in the future. It’s in the past”.
Technological unemployment is a reality, he says, and it’s observable from the decline in occupation of the US population since 2000, the year in wich human labour peaked. Ephemeralization made a lot of middle-skilled jobs obsolete, creating an occupational vacuum filled by low-skilled jobs, as jobs are automated “from the middle out”. This translated in income stagnation for the middle class, growth in incomes monthly variance and rising income inequality. All factors which ultimately affect the wellbeing of individuals and society as a whole, producing a costant sense of insecurity in the population. But, according to Santens, we shouldn’t fear automation:
“We have the opportunity to forever free humanity from drudgery and toil, but as long as people require money to live, and jobs are the primary way of obtaining money, people will fear automation.”
Technologic unemployment ends up hindering productivity itself, because automation of the medium skilled jobs makes workers shift toward the low skilled ones, increasing the offer of low paid work and thus making automation less convenient and postponable.The answer resides in decoupling work from income, through the introduction of an Unconditional Basic Income, a solution which would make income circulate from top to bottom. It would eliminate the necessity to work in order to survive, thus driving very many undesirable jobs out of the labour market and making automation more impellent. With a better distribution of wealth, full automation could be reached, eliminating many unnecessarry and unsatisfactory jobs, and society would be ultimately able to floursih. Scott Santens puts this clearly:
“…how much are we holding civilization back by allowing impoverishment to continue? How much more could we accomplish as a species, if we made the choice, that’s right, THE CHOICE, to abolish poverty and extreme inequality forever, by simply investing in humanity — in each other?”
More information at:
Scott Santens, “It’s Time for Technology to Serve all Humankind with Unconditional Basic Income”, Medium, April 13th 2018
by Guest Contributor | Apr 23, 2018 | Opinion
Sarath Davala is an independent sociologist who, along with Guy Standing, was the architect of a series of UNICEF-backed basic income pilots in Madhya Pradesh, central India. Inspired by the findings of that study, he became the co-founder and coordinator of the India Network for Basic Income.
The Basic Income Asia Pacific 2018 conference held in Taipei this March featured a host of speakers from around the world, including Davala. I got to sit down with Davala at National Taiwan University to talk about his research and the applicability of basic income to Asia. The following transcribed interview has been lightly edited.
Please talk about your research in India, and how it has led to your support for UBI as policy.
Between 2011 and 2013, a women’s trade union called the Self Employed Women’s Association conducted an experiment in Madhya Pradesh. I was heading that research project and Guy Standing was supporting as the main principal researcher. Now that study where we gave unconditional basic income to 6,000 people living in nine villages came out with findings which were startling and surprising. Because at the time people believed – the government said, the bureaucrats always said, and everyone in the middle-class believed – that if you give money to people without any conditions, they will not use it for good purposes but bad purposes, like drinking alcohol and other things. But we found that many positive things have happened in all these villages. Particularly, the most vulnerable in society benefited the most.
That gave us the conviction that UBI is a very good policy. It need not replace everything (to say that only UBI should be there), but when you are designing or redesigning your welfare basket for your nation, you must have this as the foundation, where everybody gets a certain basic amount of money, and on that they build a life. UBI can be a foundation on which the market or the government, can actually build your life. So that is how research comes into policy.
Could you talk about the process in which you made the Madhya Pradesh basic income pilots a reality? How did you gain the support of local government?
We didn’t ask the local government for money, that’s the important thing. We asked a variety of people, but finally UNICEF agreed to give us the money. It was not a small amount of money, almost a million US dollars. That was required because we were giving cash to people.
Everyone is in process of searching for alternatives, even the government, because the existing system is not delivering the welfare properly, effectively. So we said [to the government], “here’s an alternative, please join us, listen to us, once every three months we will come talk to you.” So that, when we finally come out with the findings, the government said “Oh yeah, we know these guys, they’ve been doing this work.”
So that was one reason, we followed up with policymakers. But at the same time, the other reason was we needed local support. Because if you go to a village and say you want to distribute cash, the local politicians and media will be a problem. So we had the friendship of the government, the trade union which was working in the area, and international experts like Guy Standing. With this kind of combination, we have been able to roll out a study.
Did you encounter any challenges in implementing the basic income experiment on the ground?
A variety of challenges. Even in 2010, when somebody told me they have a project like this, asking “would you like to head this project?” I said “What? Giving money to people? Without any conditions? I always suspected you were mad but now it’s confirmed.” I thought it was crazy.
Similarly when you go to the villages, and say “we want to give cash to everybody for one year.” They say, “what kind of crazy fellow you are!” There’s a lot of disbelief, but also lots of suspicion, that “you guys have something else in your mind and you are going to cheat us, you are taking our consent signatures, maybe you will use our signatures to grab our lands.” People were suspicious about our motives. But then it took us a long time to bring everybody inside. There were 10 percent of the people who rejected the process. But then, women from those rich households said, “no, no. We want to be part of it. You are conducting training programmes and opening bank accounts. We don’t have bank accounts.” So they were interested.
In your presentation earlier, you talked about how it’s important to consider Asia’s local context. You have also worked with Guy Standing, who coined the term, an emerging socioeconomic class, the “precariat.” Do you think the concept of “precariat” is applicable to the situation in developing countries, or is the “precariat” more particular to developed societies?
No, no no. The precariat is everywhere. The percentage will change [depending on the economy], but the percentage is increasing. In fact, earlier the precariat was at the bottom, but even if you go to the high end jobs, you realise that the contracts are very fragile. Today you are there, tomorrow you can be given a pink slip: “okay, you are no longer needed.” Of course, the precariat is there in developing countries, but also every other country.
You want to deny that there’s a precariat, it’s up to you. But if you want to see, there is precariat. Who is the precariat? Precariat is that class of people whose basis of livelihood is very precarious. Today it is there, tomorrow it is not. And they can turn anywhere. That’s why Guy Standing says it is the most dangerous class. They can turn into anything, into crime, into drugs.
Speaking of the Asian context, would you say Asia is particularly vulnerable to the coming wave of automation?
Which economies are more vulnerable to automation and which are not? Within India, automation will affect maybe small section of the industrial manufacturing sector and the software industry. But because of the surplus cheap labour available in India, most of the entrepreneurs will bank on cheap labour.
So for India, I do not see the threat of automation, but it is possible in Taiwan. You are going to have your first automated 7-11? If that is profitable, more and more Family Marts, KFCs, McDonalds may switch their outlets. At the end of the day, an entrepreneur is looking at costs. And human beings are so difficult to manage, every entrepreneur will say. I taught human resources courses in a business management school for seven years. Every businessman is trying to get rid of them.
In your presentation, you talked about how the Indian government has been reducing the welfare state and pushing responsibility to the family and the market. In this context, do you think UBI is a way for governments to reject its responsibility as the welfare state to provide more social services?
Absolutely. Every government in the world is under pressure now. They are under pressure in order to pursue economic growth. They think if economic growth is there, everything will be alright. Under those pressures, they want foreign investment to come in, they want multinationals to establish units in their countries. So they want economic activity in their country, so they’re doing a variety of things with other nations, particularly the richer ones. They’re under tremendous pressure.
When those pressures are there, governments are trying to reduce their responsibility to the people. It’s our job as civil society that we have to keep reminding government that “this is your minimum responsibility. If not in that way, then you should do it this way.” We are saying that, in the welfare basket, UBI is a foundation, the primary thing. On top of it, we can put additional various other things. So that should be the new design. We are making a new design of the welfare basket, trying to propose to the government “in all circumstances you must do this. Don’t throw us into the market, and don’t throw us into the family,” because everyone in the family is in a precarious position. We have to force the government to implement basic income, because that gives basic security to everyone.
Any other comments?
I think there is great promise in the group steering the UBI Taiwan movement. I wish everyone in UBI Taiwan great success. To all the readers, please join and strengthen the movement, because we are definitely making history.
Interviewer: Shuhei Omi, Writer for UBI Taiwan
