Alaskan Dividend influence: Alberta, New Mexico, and beyond (from 2005)

by Karl Widerquist | Dec 13, 2017 | Opinion, The Indepentarian

This essay was originally published in the USBIG NewsFlash in October 2005. 

Dividend checks from the Alaska Permanent Fund (APF) go out this month paying $845.76 (US), to every Alaska resident. (The APF is the only existing Basic Income in the world. It pays yearly dividends based on earnings from an investment fund created out of the state’s oil tax revenues.) The amount is down slightly from last year. The reason for the decline is that each year’s returns are tied to stock market returns over the last five years, and recent market returns have been much lower than returns in the late 1990s. The recent increases in oil prices are increasing the total size of the fund, but it will be years before their effects are felt in the yearly dividends.

The idea of the fund is gathering more and more attention around the world. The Alberta government is preparing to send checks of $400 (Canadian) to every resident of the province. The checks are a one-time response to the province’s large budget surplus, which has been caused largely by the recent increase in oil tax revenue. Although this is a one-time grant, the program’s architects credit the APF as inspiration. New Mexico, which also has a growing budget surplus thanks to the recent increase in oil prices, maybe the soon follow suit. Governor Bill Richardson and prominent members of the state legislature have been discussing a one-time tax rebate in the neighborhood of $50 (US) per person.

The spread of the Permanent Fund idea does not stop with Alberta and New Mexico. Recent editorials have discussed the idea around the world. Kevin O’Flynn, writing for Newsweek International, mentioned the APF as one of the possible models for reform of Russia’s oil industry. Two recent editorials have argued for a permanent oil dividend in Iraq. Lenny Glynn, writing for The Weekly Standard, argues than enshrining an oil dividend into Iraq’s constitution would be a force for democracy, national unity, and economic development. It would almost certainly make the constitution more popular. Ronald Bailey, writing for Reason on line: Free Minds and Free Markets, includes the creation of an “Iraq Permanent Fund” in his list of things the Bush administration should have done for a successful post-war Iraq (https://www.reason.com/links/links081805.shtml).

Petroleum.com: Latin American Energy, Oil & Gas included a commentary by Michael Rowan, entitled “the Sinkhole,” praising Permanent Fund and comparing it to Venezuela’s nationalization of its oil industry. Governor Jay Hammond began setting up the permanent fund at about the same time that Carlos Andres Perez nationalized Venezuela’s oil industry in 1976. Rowan argues that nationalization of 100% of Venezuela’s oil revenues had no noticeable effect on poverty in Venezuela, but the Alaska fund, which distributes only a fraction of the taxes on Alaska oil revenues, has provided a real and verifiable benefit to low-income Alaskans—and has been especially important in reducing poverty among indigenous Alaskans. “If [Perez] had done what Hammond did in 1976, Venezuela’s Permanent Fund would have about $120 billion this year, paying a dividend of $1,500 to each of 8 million Venezuelan families.” The editorial is hostile to activist government policies, but it is not hostile to policies that effectively help the poor. Rowan’s endorsement shows that the Permanent Fund idea is a good way to promote anti-poverty policies with the political right, but that’s not all there is to it. People who normally favor redistribution should not ignore Rowan’s argument that getting money into the hands of the poor can be more effective toward economic equality than putting a government in direct control of resources. Rowan’s commentary is online at: https://www.petroleumworld.com/Ed081105.htm.

-Karl Widerquist, Oxford, UK, October 2005

Jay Hammond, Father of the Alaskan Basic Income, Dies at 83 (from 2005)

by Karl Widerquist | Dec 7, 2017 | Opinion, The Indepentarian

This essay was originally published in the USBIG NewsFlash in August 2005. 

Jay Hammond, the governor of Alaska from 1975 to 1982, who led the fight to create the Alaska Permanent Fund, was found dead at his Homestead about 185 miles southwest of Anchorage, on Tuesday, August 2, 2005. He led an amazing life. Hammond was a laborer, a fur trapper (by dogsled), a World War II fighter pilot, an Alaskan bush pilot, a husband, a father of three, a wildlife biologist, a backwoods guide, a hunter, a fisher with the U.S. Fish and Wildlife Service, and a homesteader. Hammond was one of the last people to take advantage of the Civil-War-ear U.S. law giving away land. Other than a requirement to build a house and farm the land for five years, it was given away free—no strings attached.

Hammond was also a hero to everyone who believes that no one should be barred from the resources they need to meet their basic needs—no strings attached.

Hammond got the idea for a resource dividend when he was mayor of a small town on Bristol Bay, Alaska in the 1960s. He realized that salmon were being taken out of the area without necessarily helping the town’s poor. He proposed a three percent tax on all fish caught in the area to be redistributed to all residents of the town. By an enormous stroke of luck, the man who had that idea (and saw it work in Bristol Bay) would be elected governor of Alaska just as the state was beginning construction of the Trans-Alaska oil pipeline. Oil companies stood to make billions of dollars, and of course, they argued that Alaskans would benefit through new job opportunities, but Hammond knew one way to make sure that every single Alaskan would benefit from the pipeline.

And so the Alaskan Permanent Fund was born. For the last 20 years, every Alaskan has received income from state oil revenues. A portion of the state’s taxes on Alaskan oil goes into an investment fund, which pays dividends from the interest on those investments—hence the permanent fund. Dividends vary, but they are usually more than $1,000 per year for every man, woman, and child living in the state.

The system is not perfect. Hammond told Tim Bradner, of the Anchorage Daily News, that his biggest regret was to let the legislature eliminate the state’s income tax. Without the citizens’ responsibility to pay taxes to support state services the fund will be vulnerable, and the legislature has been trying to raid the fund ever since. So far, the enormous popularity of the fund has protected it fairly well. Hammond also regretted that the fund was too small. Only one-eighth of the state’s oil tax revenues go into the fund. If half of oil tax revenues went into the fund, as Hammond envisioned, every Alaska family of four could expect to receive more than $16,000 this year. Hammond died campaigning to increase the size of the fund.

But the most important thing about the fund is that it exists. It’s simple, it works, and everyone in the state benefits from it every year. How many elected officials can say they did that? According to Sean Butler in Dissent Magazine, Nobel Prize-winning economist Vernon Smith, called the Permanent Fund, “a model governments all over the world would be wise to copy.” It is a pilot program for resource taxes and basic income plans all over the world. Economists have recommended the Alaska solution for resource-rich, poverty-ridden countries from Nigeria to Iraq. Just this summer the government of Azerbaijan sent a delegation to Alaska to study the Permanent Fund. You can’t keep a good idea down.

Jay Hammond spoke at the 2004 USBIG Congress in Washington, DC. Here is how Butler describes the event: “The father of the Brazilian basic income, Senator Eduardo Suplicy, also presented at the USBIG conference last year. During his speech, he noticed Jay Hammond sitting in the front row, and, to warm applause from the assembled crowd, descended from the stage to shake his hand. The two basic income pioneers had at last met. Hammond and Suplicy make an odd couple. The Republican Hammond, with his Hemingway-like white beard and grizzly build, wears his far north ethos of self-reliance with pride. Suplicy, a founding member of the left-wing Brazilian Workers Party and a U.S.-trained economist, has the dignified appearance of an intellectual and professional politician. Its tropical socialism meets arctic capitalism; yet somehow, when the two come together over basic income, they get along.”

I had the good fortune to attend that event and meet Governor Hammond. He was warm and engaging. He wasn’t there to bask in the glory of people who admired his past achievements but to fight to keep improving the APF. He was a genuine hero.

An article on Hammond and basic income by Sean Butler, entitled, “Life, Liberty, and a Little Bit of Cash,’ appeared in Dissent Magazine just a few weeks before he died.

There have been many good tributes to Hammond in the news and on the internet since his death. Here are just a few:

Frank Murkowski, current governor of Alaska, “Hammond’s Legacy Will Stand Out,” Alaska Daily News
Tim Bradner, “Hammond has passed; his ideas must live on,” Alaska Daily News
Douglas Martin, “Governor of Alaska Who Paid Dividends,” New York Times

The Basic Income Guarantee Experiments of the 1970s: a quick summary of results

by Karl Widerquist | Dec 3, 2017 | Opinion, The Indepentarian

So many countries are currently conducting or seriously talking about starting Universal Basic Income (UBI) experiments that it’s becoming hard to keep track. These are not the first experiments in UBI or other forms of Basic Income Guarantee (BIG). Namibia and India conducted UBI experiments in the late 2000s and early 2010s. And between 1968 and 1980, the U.S. and Canadian Government conducted five Negative Income Tax (NIT) experiments. They were the world’s first major social science experiments of any kind. They are worth reviewing because they provide not only inspiration and precedent but also relevant data and important lessons for the current experiments.

I’m working on a book (tentatively titled Basic Income Experiments: The Devil’s in the Caveats) drawing lessons from the ’70s experiments for the current round of experiments. This blog post previews a chapter from that upcoming book providing a review of results from the 1970s experiments. The chapter, in turn, draws heavily on my earlier work on BIG experiments including “A Failure to Communicate: What (if anything) Can We Learn from the Negative Income Tax Experiments” and “A Retrospective on the Negative Income Tax Experiments: Looking Back at the Most Innovative Field Studies in Social Policy.” Next week, I’ll make a blog post showing how poorly understood the NIT experiments were in the media at the time.

Labor market effects

Unfortunately, most of the attention of the 70s experiments was directed not at the effects of the policy (how much does it improve the welfare of low-income people) but to one potential side effect (how does it affect labor hours of test subjects). And so that issue takes up most of the discussion here.

Table 1 summarizes the basic facts of the five NIT experiments. The first, the New Jersey Graduated Work Incentive Experiment (sometimes called the New Jersey-Pennsylvania Negative Income Tax Experiment or simply the New Jersey Experiment), was conducted from 1968 to 1972. The treatment group originally consisted of 1,216 people and dwindled to 983 (due to dropouts) by the conclusion of the experiment. Treatment group recipients received a guaranteed income for three years.

The Rural Income Maintenance Experiment (RIME) was conducted in rural parts of Iowa and North Carolina from 1970 to 1972. It began with 809 people and finished with 729.

The largest NIT experiment was the Seattle/Denver Income Maintenance Experiment (SIME/DIME), which had an experimental group of about 4,800 people in the Seattle and Denver metropolitan areas. The sample included families with at least one dependent and incomes below $11,000 for single-parent families or below $13,000 for two-parent families. The experiment began in 1970 and was originally planned to be completed within six years. Later, researchers obtained approval to extend the experiment for 20 years for a small group of subjects. This would have extended the project into the early 1990s, but it was eventually canceled in 1980, so that a few subjects had a guaranteed income for about nine years, during part of which time they were led to believe they would receive it for 20 years.

The Gary Income Maintenance Experiment was conducted between 1971 and 1974. Subjects were mostly black, single-parent families living in Gary, Indiana. The experimental group received a guaranteed income for three years. It began with a sample size of 1,799 families, which (due to a large drop-out rate) fell to 967 by the end of the experiment.

The Canadian government initiated the Manitoba Basic Annual Income Experiment (Mincome) in 1975 after most of the U.S. experiments were winding down. The sample included 1,300 urban and rural families in Winnipeg and Dauphin, Manitoba with incomes below C$13,000 per year. By the time the data collection was completed in 1978, interest in the guaranteed income was seriously on the wane and the Canadian government canceled the project before the data was analyzed.

Table 1: Summary of the Negative Income Tax Experiments in the U.S. & Canada

* G = the Guarantee level.

** t = the marginal tax rate

Source: Reproduced from Widerquist (2005)

Scholarly and popular media articles on the NIT experiments focused, more than anything else, on the NIT’s “work-effort response”—the comparison of how much the experimental group worked relative to the control group. Table 2 summarizes the findings of several of the studies on the work-effort response to the NIT experiments, showing the difference in hours (the “work reduction”) by the experimental group relative to the control group in foregone hours per year and in percentage terms. Results are reported for three categories of workers, husbands, wives, and “single female heads” (SFH), which meant single mothers. The relative work reduction varied substantially across the five experiments from 0.5% to 9.0% for husbands, which means that the experimental group worked less than the control group by about ½ hour to 4 hours per week, 20 to 130 hours per year, or 1 to 4 fulltime weeks per year. Three studies averaged the results from the four U.S. experiments and found relative work reduction effects in the range of 5% to 7.9%.[i]

The response of wives and single mothers was somewhat larger in terms of hours, and substantially larger in percentage terms because they tended to work fewer hours, to begin with. Wives reduced their work effort by 0% to 27% and single mothers reduced their work effort by 15% to 30%. These percentages correspond to reductions of about 0 to 166 hours per year. The labor market response of wives had a much larger range than the other two groups, but this was usually attributed to the peculiarities of the labor markets in Gary and Winnipeg where particularly small responses were found.

Table 2: Summary of findings of work reduction effect

* The negative signs indicate that the change in work effort is a reduction

** Hours per year except where indicated “hpw,” hours per week.

NJ = New Jersey Graduated Work Incentive Experiment

SIME/DIME = Seattle / Denver Income Maintenance Experiment

Gary = Gary Income Maintenance Experiment

RIME = Rural Income Maintenance Experiment

Mincome = Manitoba Income Maintenance Experiment

SFH = Single Female “head of household.”

Source: Reproduced from Widerquist (2005)

All or most of the figures reported above are raw comparisons between the control and experimental groups: they are not predictions of how labor market participation is likely to change in response to an NIT or UBI. There are many reasons why these figures can’t be taken as predictions of responses to a national program. The many difficulties of relating experimental results to such predictions is a major theme in the book I’m writing. I’ll mention just four of them now.

First, the study participants were drawn only from a small segment of the population: people with incomes near the poverty line, about the point at which people are most likely to work less in response to an income guarantee because the potential grant is high relative to their earned income. Thus, the response of this group is likely to be much larger than the response of the entire workforce to a national program. One study using computer simulations estimated that the work reduction in response to a national program would be only about one-third of reduction in the Gary experiment (1.6% rather than 4.5%).[ii] Although simulations are an important way to connect experimental data with what we really want to know, the more researchers rely on them the less their reports are driving by their experimental data.

Second, the figures do not include any demand response, which economic theory predicts would lead to higher wages and a partial reversal of the work-reduction effect. One study using simulation techniques to estimate the demand response found it to be small.[iii] Another found, “Reduction in labor supply produced by these programs does tend to raise low-skill wages, and this improves transfer efficiency.”[iv] That is, it increases the benefit to recipients from each dollar of public spending.

Third, the figures were reported in average hours per week and very often misinterpreted to imply that 5% to 7.9% of primary breadwinners dropped out of the labor force. The reduction in labor hours was not primarily caused by workers reducing their hours of work each week (as few workers are able to do even if they want to). Moreover, few if any workers simply dropped out of the labor force for the duration of the study, as knee-jerk reactions to guaranteed income proposals often assume.[v] Instead, it was mainly caused by workers taking longer to find their next job if and when they became nonemployed.

Fourth, the experimental group’s “work reduction” was only a relative reduction in comparison to the control group. Although this language is standard for experimental studies, it doesn’t imply that receiving the NIT was the major determinate of labor hours. In fact, in some studies, labor hours increased for both groups, and the labor hours of both groups tended to rise and fall together along with the macroeconomic health of the economy—implying that when more or better jobs were available, both groups took them, but when they were less available, the control group searched harder or accepted less attractive jobs.[vi]

As I’ll show in my next article about the NIT experiments, most laypeople writing about the results assumed any work reduction, no matter how small, to be an extremely negative side effect. But it is not obviously desirable to put unemployed workers in the position where they are desperate to start their next job as soon as possible. It’s obviously bad for the workers and families in that position. It’s not only difficult to go through but also it reduces their ability to command good wages and better working conditions. Increased periods of nonemployment might have a social benefit if they lead to better matches between workers and firms.

Non-labor-market effects

The focus of the 1970s experiments on work effort is in one way surprising because presumably, the central goals of a UBI involve its effects on poverty and the wellbeing of relatively low-income people, and assessing these issues requires look at non-labor-market effects.

The experimental results for various quality-of-life indicators were substantial and encouraging. Some studies found significant positive influences in elementary school attendance rates, teacher ratings, and test scores. Some studies found that children in the experimental group stayed in school significantly longer than children in the control group. Some found an increase in adults going on to continuing education. Some of the experiments found desirable effects on many important quality-of-life indicators, including reduced incidents of low-birth-weight babies, increased food consumption, and increased nutritional content of the diet. Some even found reduced domestic abuse and reduced psychiatric emergencies.[vii]

Much of the attention to non-labor market effects focused not on the presumed goals of the policy but on another side effect: a controversial finding that the experimental group in SIME-DIME had a higher divorce rate than the control group. Researchers argued forcefully on both sides with no conclusive resolution in the literature. The finding was not replicated by the Manitoba experiment, which found a lower divorce rate in the experimental group. The higher divorce rate in some studies examining SIME-DIME was widely presented as a negative effect, even though the only explanation for it that researchers on either side were that the NIT must have relieved women from financial dependence on husbands.[viii] It is at the very least questionable to label one spouse staying with another solely because of financial dependence as a “good” thing.

An overall comparison?

Most of the researchers involved considered the results extremely promising overall. Comparisons of the control and experimental group indicated that the NIT was capable of significantly reducing the material effects of poverty, and the relative reductions in labor effort were probably within the affordable range and almost certainly within the sustainable range.

But experiments of this type were not capable of producing a bottom line. Non-specialists examining these results might find themselves asking: What was the cost exactly? How much were the material effects of poverty reduced? What is the verdict from an overall comparison of costs and benefits?

Experiments cannot produce an answer to these questions. Doing so would involve taking positions on controversial normative issues, combining the experimental results with a great deal of nonexperimental data, and plugging it into a computer model estimating the micro- and macroeconomic effects of a national policy. The results of that effort would be driven more by those normative positions, nonexperimental data, and modeling assumptions than by the experimental results that such a report would be designed to illustrate.

Whichever strategy experimental reports take, nonspecialists will have difficulty grasping the complexity of the results and the limits of what they indicate about a possible national policy. No matter how well the experiment is conducted, the results are vulnerable to misunderstanding, misuse, oversimplification, and spin. My blog post next week will show how badly this happened when the results of NIT experiments were reported in the United States in the 1970s.

[i] G. Burtless, “The Work Response to a Guaranteed Income. A Survey of Experimental Evidence,” in Lessons from the Income Maintenance Experiments, ed. A. H. Munnell (Boston: Federal Reserve Bank of Boston, 1986). M.C. Keeley, Labor Supply and Public Policy: A Critical Review (New York: Academic Press, 1981). P.K. Robins, “A Comparison of the Labor Supply Findings from the Four Negative Income Tax Experiments,” Journal of Human Resources 20, no. 4 (1985).

[ii] R.A. Moffitt, “The Labor Supply Response in the Gary Experiment,” ibid.14 (1979).

[iii] D.H. Greenberg, “Some Labor Market Effects of Labor Supply Responses to Transfer Programs,” Social-Economic Planning Sciences 17, no. 4 (1983).

[iv] J.H.  Bishop, “The General Equilibrium Impact of Alternative Antipoverty Strategies205-223,” Industrial and Labor Relations Review 32, no. 2 (1979).

[v] Robert Levine et al., “A Retrospective on the Negative Income Tax Experiments: Looking Back at the Most Innovative Field Studies in Social Policy,” in The Ethics and Economics of the Basic Income Guarantee, ed. Karl Widerquist, Michael A. Lewis, and Steven Pressman (Aldershot: Ashgate, 2005).

[vi] Karl Widerquist, “A Failure to Communicate: What (If Anything) Can We Learn from the Negative Income Tax Experiments?,” The Journal of Socio-Economics 34, no. 1 (2005).

[vii] Levine et al, 2005.

[viii] Levine et al, 2005; Widerquist, 2005.

The Namibian BIG Proposal in Perspective (from 2005)

by Karl Widerquist | Nov 29, 2017 | Opinion, The Indepentarian

This essay was originally published in the USBIG NewsFlash in May 2005. 

While the Namibian government balks at the difficulty of raising the $200 million it would need to provide its citizens with a minimum income of a little more than 50 cents ($0.50) a day, it is important to put that cost into the first-world perspective. At an interest rate of 5%, a permanent Namibian BIG could be financed by a bond with a one-time cost of $4 billion. At that price, according to Forbes Magazine’s rankings, 48 Americans could fund this Namibian BIG single-handedly, 35 of whom would still be billionaires afterward. In other words, any one of these 48 people could afford to finance a basic income for 1.7 million Namibians, not just for one year, not just for the rest of our lives, but for all the generations to come forever—or for as long as money makes interest.

If Bill Gates donated half of his fortune to Namibia, he could finance a permanent BIG six times the size that the Namibian BIG coalition thinks its government could afford, and Mr. Gates would still have $24 billion left to support his family. A BIG this size would give every Namibian a minimum income of $3 per day. It doesn’t sound like much until you remember that 3 billion people worldwide live on less than $2 per day. It would free Namibia from the abject poverty that three-fourths of its citizens have known since colonization. That is what only one man could do, how much more could a concerted effort on the part of first-world governments do?

-Karl Widerquist, Oxford, UK, May 1, 2005

Public Reaction to the Basic Income Guarantee Experiments in the 1970s: a case of misunderstanding, misuse, oversimplification, and spin

by Karl Widerquist | Nov 26, 2017 | Opinion, The Indepentarian

This post is one of several previewing the book I’m writing on Universal Basic Income (UBI) experiments, and it is the second of two reviewing the five Negative Income Tax (NIT) experiments conducted by the U.S. and Canadian Government in the 1970s. This post draws heavily on my earlier work, “A Failure to Communicate: What (if anything) Can We Learn from the Negative Income Tax Experiments.”

Last week I argued that the results from the NIT experiments for various quality-of-life indicators were substantial and encouraging and that the labor-market effects implied that the policy was affordable. As promising as the results were to the researchers involved the NIT experiments, they were seriously misunderstood in the public discussion at the time. But the discussion in Congress and in the popular media displayed little understanding of the complexity. The results were spun or misunderstood and used in simplistic arguments to reject NIT or any form of guaranteed income offhand.

The experiments were of most interest to Congress and the media during the period from 1970 to 1972, when President Nixon’s Family Assistance Plan (FAP), which had some elements of an NIT, was under debate in Congress. None of the experiments were ready to release final reports at the time. Congress insisted researchers produce some kind of preliminary report, and then members of Congress criticized the report for being “premature,” which was just what the researchers had initially warned.[i]

Results of the fourth and largest experiment, SIME/DIME, were released while Congress was debating a policy proposed by President Carter, which had already moved quite a way from the NIT model. Dozens of technical reports with large amounts of data were simplified down to two statements: It decreased work effort and it supposedly increased divorce. The smallness of the work disincentive effect hardly drew any attention. Although researchers going into the experiments agreed that there would be some work disincentive effect and were pleased to find it was small enough to make the program affordable, many members of Congress and popular media commentators acted as if the mere existence of a work disincentive effect was enough to disqualify the program. The public discussion displayed little, if any, understanding that the 5%-to-7.9% difference between the control and experimental groups is not a prediction of the national response. Nonacademic articles reviewed by one of the authors[ii] showed little or no understanding that the response was expected to be much smaller as a percentage of the entire population, that it could potentially be counteracted by the availability of good jobs, or that it could be the first step necessary for workers to command higher wages and better working conditions.

The United Press International simply got the facts wrong, saying that the SIME/DIME study showed that “adults might abandon efforts to find work.” The UPI apparently did not understand the difference between increasing search time and completely abandoning the labor market. The Rocky Mountain News claimed that the NIT “saps the recipients’ desire to work.” The Seattle Times presented a relatively well-rounded understanding of the results, but despite this, simply concluded that the existence of a decline in work effort was enough to “cast doubt” on the plan. Others went even farther, saying that the existence of a work disincentive effect was enough to declare the experiments a failure. Headlines such as “Income Plan Linked to Less Work” and “Guaranteed Income Against Work Ethic” appeared in newspapers following the hearings. Only a few exceptions such as Carl Rowan for the Washington Star (1978) considered that it might be acceptable for people working in bad jobs to work less, but he could not figure out why the government would spend so much money to find out whether people work less when you pay them to stay home.[iii]

Senator Daniel Patrick Moynihan, who was one of the few social scientists in the Senate, wrote, “But were we wrong about a guaranteed income! Seemingly it is calamitous. It increases family dissolution by some 70 percent, decreases work, etc. Such is now the state of the science, and it seems to me we are honor bound to abide by it for the moment.” Senator Bill Armstrong of Colorado, mentioning only the existence of a work-disincentive effect, declared the NIT, “An acknowledged failure,” writing, “Let’s admit it, learn from it, and move on.”[iv]

Robert Spiegelman, one of the directors of SIME/DIME, defended the experiments, writing that they provided much-needed cost estimates that demonstrated the feasibility of the NIT. He said that the decline in work effort was not dramatic, and could not understand why so many commentators drew such different conclusions than the experimenters. Gary Burtless (1986) remarked, “Policymakers and policy analysts … seem far more impressed by our certainty that the effective price of redistribution is positive than they are by the equally persuasive evidence that the price is small.”[v]

This public discussion certainly displayed “a failure to communicate.” The experiments produced a great deal of useful evidence, but for by-far the greatest part, it failed to raise the level of debate either in Congress or in public forums. The literature review reveals neither supporter nor opponents who appeared to have a better understanding of the likely effects of the NIT and UBI in the discussions following the release of the results of the experiments in the 1970s.[vi]

Whatever the causes for it, an environment with a low understanding of complexity is highly vulnerable to spin with simplistic if nearly vacuous interpretation. All sides spin, but in the late 1970s NIT debate, only one side showed up. The guaranteed income movement that had been so active in the United States at the beginning of the decade had declined to the point that it was able to provide little or no counter-spin to the enormously negative discussion of the experimental results in the popular media.

Whether the low information content of the discussion in the media resulted more from spin, sensationalism, or honest misunderstanding is hard to determine. But whatever the reasons, the low-information discussion of the experimental results put the NIT (and, in hindsight, UBI by proxy) in an extremely unfavorable light, when the scientific results were mixed-to-favorable.

The scientists who presented the data are not entirely to blame for this misunderstanding. Neither can all of it be blamed on spin, sound bites, sensationalism, conscious desire to make an oversimplified judgment, or the failure of reports to do their homework. Nor can all of it be blamed on the people involved in political debates not paying sufficient attention. It is inherently easier to understand an oversimplification than it is to understand the genuine complexity that scientific research usually involves no matter how painstakingly it is presented. It may be impossible to communicate the complexities to most nonspecialists readers in the time a reasonable person to devote to the issue.

Nevertheless, everyone needs to try to do better next time. And we can do better. Results from experiments in conducted in Namibia and India in the early 2010s and late ’00s were much better understood, as resulted from Canada’s Mincome experiment that sadly did not come out until more than two decades after that experiment was concluded.

The book I’m working on is an effort to help reduce misunderstandings with future experiments. It is aimed at a wide audience because it focuses the problem of communication from specialists to non-specialists. I hope to help researchers involved in current and future experiments design and report their findings in ways that are more likely to raise the level of debate; to help researchers not involved in the experiments raise the level of discussion when they write about the findings of the experiment, to help journalists understand and report experimental findings more accurately; and to help interested citizens of all political predispositions see beyond any possible spin and media misinterpretations to the complexities of the results of this next round of experiments—whatever they turn out to be.

[i] Widerquist, 2005.

[ii] Widerquist, 2005.

[iii] Widerquist, 2005.

[iv] Widerquist, 2005.

[v] Burtless, 1986.

[vi] Widerquist, 2005.