The economist says that, as many people fear, it is entirely plausible that the problem of inequality will get worse if countermeasures are not undertaken. Although he recognizes that a single program such as UBI may offer some advantages, he is not a big fan of the idea. Instead, he thinks that the main responsibility a society has is to provide everybody with a job (a Job Guarantee).
Stiglitz states that if jobs with decent salaries were available, the need for UBI wouldn’t exist, even though some social programs to protect the needy would be needed. But in his opinion many people find dignity in their job, and so the focus of the attention should be to make the labour market work properly.
A goal that could become more and more difficult to attain as technology advances, with machines threatening an ever-increasing number of professions. As automation proceeds, the risk is that inequalities will increase, as a result of growing unemployment and AI undermining the very basis of the market.
Artificial Intelligence (AI), Stiglitz states, makes it possible to alter the functioning of the market economy, making everybody pay a different price, appropriating consumer surplus and adding it to the profit of the wealthiest, thus further polarizing the distribution of wealth.
The solution should be, in the economist view, twofold: on the one hand, the economy has lost its balance because workers lost their bargaining power, and thus it should be reestablished. On the other hand, the core of innovation is government funded research and government funded education, but too little of the proceeds go to the public, and a better system of sharing the benefits need to be designed.
While Stiglitz states he is not a big supporter of UBI, what he proposes in order to reduce inequality is what UBI itself is designed to do: provide workers with bargaining power and redistribute the wealth of society in a more equal manner.
How the welfare system in the UK – and in Scotland in particular – is failing to reduce poverty and economic insecurity, within its own terms.
Presentation of the updated findings on the basic income trial presently ongoing in Fife.
Modelling the impact of a basic income in Scotland (by Landman Economics).
Analysing political, legal and administrative scenarios enabling a first Scotland-wide basic income experiment, in the path for its implementation in the region.
The report also features direct input from potencial beneficiaries of the Fife basic income trial (which is still under study / consideration), a precious contribution from those directly affected by the current system of means-testing conditional social security. Taking the example of Fife, Painter and his colleagues have projected that “£2400 a year would half destitution and reduce relative household poverty by 8,5%. A basic income of £4800 a year would end destitution and reduce relative household poverty by 33%.” It’s relevant to notice that the Scottish living wage is currently £9 per hour, which for a regular 8 h/day job amounts to about 1440 £/month. So, these basic income amounts under consideration are only 14 and 28% of what it takes to live comfortably in Scotland.
Anthony Painter summarizes how a basic income in Scotland could be tested within a whole set of other public policies in place:
“In A Basic Income for Scotland we map how pilots of basic income could work with a full set of supports alongside cash payments. We call this community designed system of interlocking public, community, and employer supports wrapped around basic income a ‘Civic Basic income’.”
Hilde Latour, a long-standing basic income activist from the Netherlands, has recently made a presentation on a TEDx independently organized event, in Amstelveen, Netherlands. Latour is also a coordinator / director at Wisecolab, a forward-looking organization of thinkers, activists and technology experts, who try to bring new common good narratives to people, backed and helped by technology recent and future developments.
Summarizing Latour’s TEDx talk, the following can be said: Hilde is on a mission to create a world free of poverty. A basic income for everyone on this earth will not only eliminate poverty but will also contribute to other goals like reduce crime and increase health. It will impact us all. There is no need to wait for politicians. Innovation and technology can help to create this sustainable future.
An important report on basic income has been released in the UK, as announced before, and publicly presented at the RSA last Tuesday. In that report, one central idea is to put forward, for the UK social reality: to give every adult citizen a 100 £/week (equivalent to about 460 €/month), unconditionally and without means-testing. According to the Progressive Economic Forum (PEF), this policy can be tested in the UK in five different ways (for an year):
Giving a 100 £/week (116 €/week) to every adult in a randomly selected community, plus 50 £/week (57 €/week) for children and any extra amount to account for disability necessities. The scheme would replace all benefits but the housing benefit.
Giving a 70 £/week (81 €/week) to every adult in a randomly selected community, plus 20 £/week (57 €/week) for children, but keeping child benefits. All other means-tested benefits would remain in place, accounting for the unconditional transfer as income, thus reducing or eliminating the (existing) benefits paid.
A 50 £/week (58 €/week) to every adult in a randomly selected community, plus any existing benefits (not considering the unconditional transfer as income).
A randomly selection of adults (country-wide) on welfare seeing conditionalities removed.
A randomly selection of homeless people given an unconditional cash grant, replacing other (cash or non-cash) benefits.
At the referred presentation, Labour Party’s John McDonnell, the Exchequer Shadow Chancellor, said the Labour Party is not committing to introduce basic income in the UK (if elected), but this report will definitely be instrumental for the party’s next manifesto design.
Not surprisingly, Tories in parliament stand firmly against this policy, branding it as a “handout”, and dismissing it as hugely expensive and unfair to “hardworking taxpayers”. To that, Guy Standing, main author of the referred author, has replied that governments looking forward should “at the very least introduce local pilots to see how effective it could be”. He and RSA Director Anthony Painter have been strong proponents of reducing or eliminating means-testing and conditionality in general, in a welfare system in the UK which has been “expensive to administer and is causing destitution”. Painter summarizes by saying that “basic income-style pilots have been proven to have beneficial effects on health, well-being, and trust, while giving people more freedom to decide for themselves how to manage their lives.”
A series of articles have been produced on this issue, in several news outlets, such as the Guardian, Brave New Europe, the Mirror and BBC News. The presentation video can be watched below, and also heard on an RSA podcast.
Last Monday, on the 29th of April, a special event was held in Suwon, a city in the province of Gyeonggi-do, just south of Seoul, South Korea. This event was conceived as a fair, the first of its kind, and was focused on basic income, having attracted more than 18 thousand people.
Announced in a previous report, the two-day event was featured by numerous experts on basic income and related policies. It was propelled by the recent adoption, in the cited province, of a local currency unconditional cash transfer to young people (born in 1995), dubbed “Youth Dividend”. This local currency is issued by the city, and so can only be spent in small or mid-size local businesses (which can help boost the local economy).
Moreover, according to Gyeonggi-do spokesperson, Kim Yong, the province regional government will work with other regions of South Korea in order to study basic income implementation “in more depth”. Kim Yong also guarantees there are other basic income-type policies being studied in the province, while the “Youth Dividend” scheme is presented in other 60 regions within South Korea. During the fair, the formation of a “Basic Income Council” was alluded to by local authorities, grouping 34 local autonomies, most within Gyeonggi-do.
The basic income fair was also a way to inform the general public about basic income as a policy itself, and how it is being pursued in the world. A short video report can be watched here (News Center):
As reported before, the Indian State of Sikkim, through the political party Sikkim Democratic Front (SDF), presently holding power, is “committed to bringing Universal Basic Income” (UBI). The state is currently under an electoral process, which is set to terminate until the 27th of May. Other parties are contending the election (e.g.: Sikkim Krantikari Morcha (SKM)), but these are unlikely to overthrow SDF, according to polls.
SDF officials are considering funding an UBI policy with hydropower revenue which, however, does not come without controversy, since some of these installations have affected sensitive ecosystems and the people dependent on them (the Lepchas). According to Tseten Lepcha, working President of the Affected Citizens of Teesta (ACT), in Sikkim, at least one of the largest hydropower projects are not well equipped with transmission lines, which limits the amount of electricity able to flow out of the installation, curbing its rentability (and, therefore, the available funds for the future UBI). The ATC also sustains that the regional government hasn’t taken due provisions to limit environmental and social impacts in the affected areas, which is definitely a contested issue with government officials (who believe all those issues have been taken care of).
One of these provisions has to due with the area of cultivable land that has gone under water, from which people from the affected areas drew their subsistence. That due to the existing power plants, a problem which will be aggravated by around 20 more hydropower projects still in planning. Locals are concerned about this issue, which directly affects their livelihood. However, they generally support the idea of a UBI being implemented in Sikkim.
A short video can be watched, summarizing the content around UBI’s proposal in Sikkim:
