by Kate McFarland | Aug 29, 2017 | Research
Ville-Veikko Pulkka, a public policy researcher and doctoral candidate at the University of Helsinki, has published his paper “A free lunch with robots – can a basic income stabilise the digital economy?” in European Review of Labour and Research.
Pulkka was previously employed as part of the research team at Kela, the Finnish Social Insurance Institution, responsible for the design and preparation of the nation’s two-year experiment replacing conditional unemployment benefits with an unconditional basic income.
The Finnish experiment has been the topic of most of his previous published work and presentations related to basic income (including presentations at conferences in Switzerland, Poland, Finland, and Ireland).
Pulkka’s research at the University of Helsinki, including his doctoral dissertation, centers on the implications of the digital economy for labor and public policy.
“A free lunch with robots,” his latest publication on basic income, moves away from focus on the Finnish experiment to explore the latter topic in more general terms:
The discussion on the possible implications of the digital economy for labour continues unabated. An essential dimension of the discussion is the widely shared view that a basic income could guarantee sufficient purchasing power for unemployed, underemployed and precarious workers should technological unemployment and labour market insecurity increase. A budget-neutral basic income has serious limitations as an economic stabilisation grant, but if financing proposals are revised, these limitations can be tackled. Even though guaranteeing sufficient purchasing power for unemployed, underemployed and precarious workers does not necessarily require an unconditional universal benefit, it seems clear that traditional activation based on strict means-testing and obligations will not be a strategy flexible enough to guarantee sufficient consumer demand in fluctuating labour markets. An economically sustainable solution might be to reduce means-testing gradually and to study carefully the effects.
The full article is available behind a paywall here.
Reviewed by Russell Ingram.
Photo CC BY-NC 2.0 Helen Taylor
by Dave Clegg | Aug 21, 2017 | Research
This paper represents a massive undertaking by both University of Melbourne Australia faculty and an independent agency called the the Brotherhood of St. Laurence dedicated to social Justice. It looks at a collection of BI pilot projects, as well as other projects which can be considered close approximations of a BI, from around the world. Government projects which have been run in the past as well as private and government projects currently being implemented.
The paper provides a number of graphs and and analyses aimed at comparing and contrasting the examined projects while underlining the incredible number of variables affecting both the design and the outcome of any such project that must be attended to. But the main focus of this paper is to determine how a BI can ensure equity of income, improved efficiency of governance and an end to the stigma of social supports.
While considering the concept of a BI to be attractive for a host of reasons, not the least of which are equity and the automation of the workplace, the paper is decidedly cautious and suggests careful consideration of “… broader issues and the intersecting domains and policies” which one can only assume refers to the social and economic ramifications of such a project. A very bureaucratic summation of some extremely crucial social concerns.
by Kate McFarland | Aug 19, 2017 | Research
Three members of the Foundation for European Progressive Studies (FEPS) Young Academic Network — Frederick Harry Pitts, Lorena Lombardozzi, and Neil Warner — have published a study on basic income, entitled “Beyond Basic Income: Overcoming the Crisis of Social Democracy?”
The full paper can be read and downloaded here.
Abstract
Across Europe, a crisis of social democracy prevails. Deindustrialisation precipitates a breakdown of the communities, institutions and interests that held the social democratic and labour movements together. A collapse in everyday life passes over into a steady decline in the electoral realm. Elsewhere, a crisis of social reproduction ensues. The relationship between the wage and subsistence weakens, public services face cutbacks and a generalised dispossession of people from the commons continues apace. This triple crisis- of the society of work, social reproduction and social democracy- is a triple crisis of the social. The universal basic income (UBI) is suggested by many as a means by which the social synthesis can be pieced back together.
In this paper we explore whether or not UBI lives up to the claims made for its implementation, and to what extent it addresses these three crises. We ultimately pose the question whether UBI offers a solution to the crisis of social democracy, and whether, on this basis, European social democrats should pursue the policy as a central demand of a new electoral offer. We conclude that the policy cannot be suggested as a solution to the crises of work and social reproduction, at least not without being complemented by a range of other measures. A suite of reforms could strengthen its impact and ensure it is used to nurture and preserve positive social relations that reflect social democratic ideas, rather than contrary outcomes implied in alternative visions of the UBI proposed from both right and left of the political spectrum.
About the Authors
Frederick Harry Pitts holds a PhD from the Department of Social and Policy Sciences at the University of Bath, and is currently a Lecturer in Management at the University of Bristol. His research interests lie in the sociology of work and political economics, with specializations in the creative industries and the future of work.
Lorena Lombardozzi is a graduate student at SOAS University of London, where she holds an MSc in Political Economy of Development. Her dissertation research concerns agricultural commercialization in Uzbekistan’s cotton-food system and its nutritional impacts.
Neil Warner is a postgraduate researcher in the Department of History at Trinity College Dublin, studying perspectives on unemployment and the British Labour Party in the late 20th century.
FEPS is the first progressive think tank to operate at a European level. It has previously supported discussion of universal basic income, convening a panel discussion on the topic in Brussels in February 2016 as part of its Next Social Europe lunch debate series.
The FEPS Young Academics Network, established in March 2009, currently consists of over 50 PhD candidates and recent PhD recipients from a range of disciplines.
Photo: “Unemployment Wall” CC BY-NC-ND 2.0 Luis Colás
by Peter Vandevanter | Aug 3, 2017 | Research
Louise Haagh
Louise Haagh, an associate professor at the University of York and chair of the Basic Income Earth Network (BIEN), argues in the June Nature that the reform is making inroads internationally today.
Nature is one of the world’s top academic journals, claiming an online readership of about 3 million unique readers per month.
At the same time, Haagh says basic income is a pivoting argument, because it helps discussions that bring about changes in individual and public policy. She also argues that basic income should not be viewed in moral terms as a compensation for economic insecurity, that such a moralistic interpretation does not do full justice to the claim that “security is important because it enhances people’s sense of control over their lives”.
At the end of 2016, the year in which BIEN celebrated the 30th anniversary of its birth, Haagh, as a life member, reflected on her own personal journey with the network:
“Basic income appealed to me then primarily as a necessary foundation for consolidating workers’ rights – and in many ways that is still how I see it, but in a broader context of rights to human development… Against this background I was struck by the sanity – the immediately obvious justification for basic income. It seemed to me evident that the most important justification was a basic humanist and democratic one – and I still think that today.”
In the Nature article, Haagh says basic income is a pivoting reform, in two ways, that together may be more important than ever:
“First, it is pivoting in relation to freedom extension because it helps to rebuild individuals’ pivot positions, through re-enabling greater differentiation between different core forms of security. Second, basic income is potentially pivoting for other institutions’ development; it creates a monetary basis and rationale for building new risk-sharing mechanisms and institutions between individuals directly and through public policy.”
More information at:
Louise Haagh, “Basic Income as a pivoting reform“, Nature, June 2017 Vol 1 Article 125
by Andre Coelho | Jul 13, 2017 | Research
Malcolm Torry. Credit to: The Back Road Café
In a partnership between the Citizen’s Income Trust and the London School of Economics, Malcolm Torry, Director of the Citizen’s Income Trust and General Manager of BIEN, authors and presents a new study on the implementation of a basic income in the UK.
This study, referred to as a working paper, details two potential implementation models for a basic income, and looks into their consequences with respect to several social and economic indicators, including “poverty and inequality indices, tax rate rises required for revenue neutrality, household disposable income gains and losses, household’s abilities to escape from means-testing, and marginal deduction rates.”
The implementation models examined were, first, a basic income to all UK citizens, funded by the existing tax and benefits system, which would maintain the means test but introduce new thresholds and, second, a program that would be phased in by increasing the UK’s Child Benefit and allowing all new sixteen-year-olds to keep that benefit for life.
According to Malcom’s analysis, both models are feasible and beneficial in terms of the above indicators. Notably, estimated losses would be insignificant to households in the lowest quintile, and still relatively insignificant when considering all households. Additionally, in both cases, income tax rates would not need to be raised more than 3% in order to finance the basic income scheme roll-out.
More information at:
Malcolm Torry, “A variety of indicators evaluated for two implementation methods for a Citizen’s Basic Income”, Euromod Working Paper Series, May 2017
by Furui Cheng | Jun 15, 2017 | News, Research
In an article published in the Journal of Political Ecology, Professor Alf Hornborg of the human ecology division of Lund University proposes that each country establish a complementary currency for local use only, which would be distributed to all its residents as a basic income. In this way, humanity as a whole would regain justice and sustainability.
In pre-modern societies, monetized exchange was largely limited to long-distance trade in preciosities, while most basic needs were met through socially embedded relations of reciprocity and distribution. Radical institutional changes in the nineteenth century then made money a medium for obtaining all kinds of goods and services – what we might call “general-purpose money”.
Efficiency is the inherent logic in general-purpose money. Adam Smith identified the benefits of general-purpose money at the local level. Yet when such efficiency is pursued at the level of a globalized economy (possible because fossil fuels have minimized transport costs), the potential for power differences, polarization, exploitation and collateral damage is vastly greater. In this way, the claimed “efficiency” is perhaps even inverted. As long as we subscribe to the assumption of general-purpose money as the medium of exchange organizing human societies, exploitation and underpayment are inevitable implications of production processes.
Economists often deplore such negative aspects of globalization: environmental damage, increasing inequalities, growing regulations, and resource depletion. Yet few tend to consider general-purpose money as a cultural peculiarity to which there are alternatives. Not even Adam Smith drew this conclusion, nor did Karl Marx.
Hornborg suggests that current concerns with climate change and financial crises offer a historical moment for reflection on how the operation of the global economy might be reorganized in the interests of global sustainability, justice, and financial resilience. The societal objective must be to strike a balance between such distinct interests and concerns as market principles and capitalism, everyday local life versus global finance, and long-term sustainability and survival versus short-term gain. In Hornborg’s opinion, the solution is to establish ways of insulating these competing values from one another, rather than allowing one to be absorbed by the other.
To increase sustainability, reduce vulnerability, and diminish inequalities, he advocates a complementary currency issued as basic income. To the long list of questions one may have regarding this policy proposal, Hornborg provides some preliminary answers in his article.
In fact, addressing the negative aspects of general-purpose money itself is not a new idea. Silvio Gesell (1862-1930), a German-born entrepreneur living in Buenos Aires, was an early pioneer of this endeavor. John Maynard Keynes mentioned Gesell in his General Theory of Employment, Interest and Money:
“It is convenient to mention at this point the strange, unduly neglected prophet Silvio Gesell, whose work contains flashes of deep insight and who only just failed to reach down to the essence of the matter. …their significance only became apparent after I had reached my own conclusions in my own way. …I believe that the future will learn more from the spirit of Gesell than from that of Marx. The preface to The Nature Economic Order will indicate to the reader, if he will refer to it, the moral quality of Gesell. The answer to Marxism is, I think, to be found along the lines of this preface.”
“Gesell’s specific contribution to the theory of money and interest is as follows. In the first place, he distinguishes clearly between the rate of interest and the marginal efficiency of capital, and he argues that it is the rate of interest which sets a limit to the rate of growth of real capital. Next, he points out that the rate of interest is a purely monetary phenomenon…This led him to the famous prescription of ‘stamped’ money, with which his name is chiefly associated and which has received the blessing of Professor Irving Fisher. According to this proposal currency notes would only retain their value by being stamped each month, …with stamps purchased at a post office… The idea behind stamped money is sound… But there are many difficulties which Gesell did not face.”
From the above, the reader can identify the similarities between Hornborg’s and Gesell’s proposals, from different perspectives, for redesigning and constraining the power of ‘man-made’ general-purpose money.
Alf Hornborg, 2017, “How to turn an ocean liner: a proposal for voluntary degrowth by redesigning money for sustainability, justice, and resilience,” Journal of Political Ecology.
John Maynard Keynes, 1936, Chapter 23 of “The General Theory of Employment, Interest and Money,” Palgrave Macmillan.
Article Reviewed by Genevieve Shanahan.
