by Kate McFarland | Jul 10, 2016 | News
On June 22, 2016, the Waterloo Regional Council passed a resolution endorsing basic income.
More specifically, the resolution encourages the governments of Ontario and Canada “to research, develop, implement and evaluate a Basic Income Guarantee for all citizens,” and expresses the municipality’s support in these initiatives.
The Waterloo Regional Council also declared that it would forward the resolution to the Association of Municipalities of Ontario and Ontario Municipal Social Services Association, to encourage them to consult the municipality in the “development and evaluation of the pilot project to be implemented in Ontario.” The council hopes that Waterloo will be considered as a test site for the pilot.
As the resolution describes, the Waterloo Region has been plagued by food insecurity due to low income. A basic income guarantee “would reduce income insufficiency, insecurity, and inequality and ensure everyone an income sufficient to meet basic needs and live in dignity regardless of work status.”
The successful motion originated with the Kingston City Council, which, on December 15, 2015, became Canada’s first municipality to endorse basic income. At this time, the Kingston City Council forwarded their motion to support basic income to all other municipalities in the province of Ontario.
As of the time of this writing, Waterloo is the largest municipality in Ontario to support a basic income guarantee, according to a report by Roderick Benns for Leaders and Legacies (also posted to the Basic Income Canada Network blog).
References:
Keely Phillips, “Region of Waterloo Endorses Basic Income,” Basic Income Waterloo Region, June 23, 2016.
Roderick Benns, “Waterloo Region becomes largest municipality in Ontario to support basic income resolution,” Leaders and Legacies, June 30, 2016.
Background:
Joe Timothy, “Kingston is first municipality to endorse basic income,” Basic Income News, December 24, 2015.
Joe Timothy, “Ontario is Ready to Test a Basic Income,” Basic Income News, April 1, 2016.
André Coelho, “Ontario reaches further into basic income implementation,” Basic Income News, June 26, 2016.
Photo: Uptown Waterloo CC Andre Recnik
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by Tyler Prochazka | Jul 8, 2016 | News
This past month, United Kingdom’s Compass advocacy and publication website published an analysis of the basic income. The report discussed how the basic income could be introduced in the UK, and how it would interact with other social service programs.
One of the authors, Stewart Lansley, a Compass associate and visiting fellow in the School of Policy Studies at the University of Bristol, discussed how “income support is being weakened while secure work is becoming less available,” and how the basic income would address the impending “robotic revolution.”
The Compass report mentions the sanctions that have been introduced in UK’s entitlement system and how that was leading some to fall through the cracks. What do you think the biggest challenge of the UK’s current entitlement system is and how does the UBI address it?
Britain’s system of social security – complex and unpopular – needs a fundamental rethink. With much greater reliance on means-testing, and the erosion of the role of universal benefits, it has moved sharply away from the original Beveridge blueprint. Further, the level of conditionality has been raised, with governments exercising greater and greater control over the lives of claimants, making the system much more punitive and intrusive. Since 2013, more than one million claimants have been sanctioned, leading to a loss of benefits for between one month and three years for some of the most vulnerable of claimants.
Mass sanctioning has led to an increase in destitution and has been one of the principal drivers of the great surge in dependency on food banks. By guaranteeing a weekly income, even at a modest rate, a universal basic income (UBI) would boost the universal element of income support, reduce dependency on means-testing and bring an end to sanctioning.
What are the economic and societal risks that the UBI schemes outlined in the Compass report address?
A UBI would help tackle two key economic and social risks. First, the widespread insecurity and growing risk of poverty associated with work. Today, more than 60 percent of those in relative poverty in the UK are in work, a significant rise compared with the immediate post-war decades. By providing a guaranteed, if modest income, a UBI offers a more robust safety net in a much more insecure, low paid and fragile working environment and will help reduce the risk of poverty amongst those in work.
Secondly, whatever its ultimate impact, the impending technological and robotic revolution is set to bring further disruption and upheaval to jobs and pay. Crucially, a UBI offers an effective way of providing income protection from the wider repercussions of accelerated automation. Further, the robotic revolution may eventually bring significant productivity gains, though to what extent and when remains uncertain. Although these are yet to be realized, these could offer potentially new and significant social and economic opportunities. There is a very real risk, however, that the gains – if they are realized – will be colonized by a small powerful elite, leading to a further jump in inequality and a surge in joblessness. A UBI would play a key role in ensuring that such gains are more evenly shared.
Do you think the alignment between the left and the right over the UBI is sustainable once the specific policy details for implementation are worked out? For example, the report makes clear the UBI would not be revenue neutral nor would it eliminate all means-tested benefits, which might alienate some supporters on the right.
The right and left see a UBI from very different standpoints. The right favours a basic income as a way of achieving a smaller state, and would see its introduction as an opportunity to sweep away a range of other forms of social protection. This is undoubtedly the motive behind the support coming from some Silicon Valley enthusiasts.
The left, on the other hand, views such a scheme as part of a strong state, as a way of securing a robust income floor, of tackling poverty and as a means of promoting equal citizenship. For the left, it is a profoundly democratic and egalitarian concept that promotes both security and greater personal freedom, and a recognition that all citizens have the right to some minimal claim on national income.
These views are clearly incompatible and it is inconceivable that a scheme could be devised that satisfied both sides. Left supporters are clear that a UBI scheme must be seen as a supplement to the wider public provision of services and not as a substitute. A continuing and strengthened role for the public provision of key public services and other forms of state intervention including a generous living wage remain essential as a way of creating further platforms for a more equal and just society.
What other benefits might a UBI offer?
Integral to the concept of a UBI is the promotion of greater freedom and choice, progressive changes with transformative potential. By providing basic security, it would give people more time and more bargaining power in the labour market. With a growing debate about how to balance work-life commitments in an era of much more insecure work, a UBI would offer people greater flexibility between work, leisure and education, and over the type and length of employment while providing greater opportunity for caring and wider community responsibilities. Some might choose to work less or take longer breaks between jobs. Others would be incentivized to start businesses. Some might drop out of work entirely to care or retrain while others might devote more time to leisure, personal care or community support and less to paid work. But implicit to a UBI is that all lifestyle choices would be equally valued.
Importantly, a UBI would both acknowledge and provide financial support for the mass of unpaid work, disproportionately undertaken by women, in childcare, care for the elderly and voluntary help in the wider community.
It would value but not over-value work. The solution to working age poverty has traditionally been through a mix of decently paid employment and state income support. But income support is being weakened while secure work is becoming less available. One of the great strengths of a basic income is that it separates survival from employment and production. Tackling poverty would become less dependent on the ‘work guarantee`.
In the various schemes outlined in the report, it is noted that some form of disability benefits and others would be preserved with the UBI. How would these benefits likely operate with a UBI and how would they change?
Because a flat rate payment makes no allowance for those with additional needs, some types of means-testing would need to stay, even as we moved over time to a fuller and more generous scheme. A feasible UBI system would, for example, need to be supplemented with, at least, the continuation of disability benefits and additional help to cope with high and variable essential living costs, especially housing and childcare.
To deal with the additional costs of disability, existing benefits for disabled people would remain and run alongside the UBI. In the simulations of different UBI schemes in the report, we have retained the Personal Independence Payment and Employment and Support Allowance.
What would be the benefits of creating a Social Wealth Fund to finance the UBI?
Creating a UBI-linked social wealth fund would be one way of securing an independent source of funding outside of the general tax pool. Social wealth funds are a potentially powerful tool in the progressive policy armoury. They are collectively held financial funds, publicly owned, and used for the wider social benefit of society. Such funds have been widely used across a range of countries and would ensure that a higher proportion of the national wealth is held in common and used for public benefit and not for the interests of the few. They are a way of ensuring that at least part of the benefits of some economic activity are pooled and shared amongst all citizens and across generations.
There is already one example of a fund dedicated to a citizen’s payment, one operating in Alaska since 1982. Here, the returns from a sovereign wealth fund, funded by oil revenue, are used to pay an annual citizen’s dividend. There is an important principle involved in such an arrangement: that citizens are the proper owners of the environment and have the right to share equally in its benefits. The benefits from a common asset should not be hived off to a small number of private owners.
Although the UK has already spent most of its oil revenue, there is no reason why such a social wealth fund could not be established using other sources of income. These could include the dividends from a range of other assets – including other natural resources – and the occasional one-off taxes on windfall profits. As in Alaska, such a fund could be allowed to grow over time, with part of the proceeds from its management paid back into the fund, and part used each year to partially fund a UBI scheme. Over time, such a fund could grow significantly, sufficient to help top up any shortfall necessary to pay for a workable UBI scheme.
An alternative, and more radical way of paying for a dedicated UBI fund would be by the dilution of the heavy concentration of capital ownership, achieved through a small annual charge on the owners of shares. Such a proposal was originally made by the distinguished economist and Nobel Laureate James Meade in the 1960s, as a direct way of tackling the risk of ever-growing inequality. Such an idea was widely debated and discussed in the UK, and in some European nations, in the 1970s and 1980s, while one version of such a scheme – the wage-earner fund – was introduced in Sweden in 1981 and lasted for 10 years, though it was not used to fund a UBI or citizen’s payment.
The report notes the growing support across Europe and the UK for the UBI. What are some steps UBI advocates can take to make it a reality?
The pilot schemes being planned for Canada, Finland, the Netherlands and France are having a profound effect on the wider debate about UBI. These forthcoming experiments are helping to build momentum in support of an idea that, until recently was confined mostly to a few think tanks, commentators and academics. Crucially, they will help provide some evidence of the dynamic effects – including on the incentive to work, employment patterns, changes in participants’ well-being and the reaction of employers.
The pilots have helped build interest in the UK, and it is now time to start building on that to promote a much wider national debate on the issue.
Ultimately, a real test of how such a scheme would work depends on the application of a proper, lengthy and adequately sized pilot with a control group. To take advantage of these developments, the UK campaign should follow the lead taken by others and work to build to case for its own pilot scheme.
by Kate McFarland | Jul 6, 2016 | News
A recent survey of economists at leading institutions purports to show that 58% oppose a universal basic income, while only 2% support it. However, the survey asked specifically about a UBI that replaces all other social insurance programs and is paid only to adults over 21. Many opposed these qualifications, not UBI itself.
On Tuesday, June 28, the IGM (Initiative on Global Markets) Forum released the results of a survey on “universal basic income” distributed to the Economic Experts Panel — a panel consisting only of “senior faculty at the most elite research universities in the United States” chosen to be diverse in their specializations, locations, and political orientations.
Out of these economics experts, 58% either “disagreed” or “strongly disagreed” with a description of a specific universal basic income policy, while only 2% “agreed” and none “strongly agreed”. (The remainder were either “uncertain” or had no opinion on the matter.)
At first blush, such results are apt to shock and disappoint supporters of basic income. However, as with any survey, attention to the detail is key: what, exactly, were respondents asked?
In this case, respondents were asked to rank their opinion on the following statement on a five-point scale (or declare no opinion):
Granting every American citizen over 21-years-old a universal basic income of $13,000 a year — financed by eliminating all transfer programs (including Social Security, Medicare, Medicaid, housing subsidies, household welfare payments, and farm and corporate subsidies) — would be a better policy than the status quo.
Presumably, this particular policy proposal comes from Charles Murray, who endorsed exactly this in a recent Wall Street Journal feature.
Even before looking at the survey responses, we should take pause here: Charles Murray is a controversial figure even among — perhaps especially among — supporters of UBI. Left-leaning advocates tend to regard Murray and his proposals as “downright undesirable”, to use the phrase wielded by Daniel Raventós and Julie Wark in their June 15th article in CounterPunch.
Last January, to give another example, an article in Jacobin argued that a UBI “could do little to achieve egalitarian objectives — or even backfire badly” if the policy poorly designed. The author presented Murray’s proposal as an example of “non-liveable” basic income, due to its low amount and concurrent elimination of Medicaid, Medicare, and Social Security.
With this in mind, then, it should not be too surprising that several economists in the IGM Forum also took issue with the proposed elimination of all other benefits — but not UBI per se — when explaining their votes of “Disagree” or “Strongly Disagree”. Some even expressed support of policies closely related to UBI. For instance, Richard Schmalensee (MIT) said, “A properly designed negative income tax could be part of a better policy, but replacing everything is a bad idea.” Similarly, Eric Maskin (Harvard) replied, “A minimum income makes sense, but not at the cost of eliminating Social Security and Medicare.” And Christopher Udry (Yale) opined that UBI could work if “coupled with universal health care and tax reform … but we are far from that.”
Larry Samuelson (Yale), who responded as “Uncertain”, stated, “There is much to recommend a universal basic income, but specifically a 13k income while ending all other transfers is difficult to assess.”
The proposed restriction of the UBI to adults over 21 worried other economists — such as William Nordhaus, who said, “And the children get nothing? The basic idea is sound but too simplistic as stated.” Likewise, Robert Hall (Stanford) simply offered, “Limitation to people over 21 can’t be the right answer.”
This is not to suggest, of course, that all of the economists surveyed were inclined to support a basic income (but just not Charles Murray’s version). Some did express opposition to UBI itself, and for reasons that we might expect: it’s too expensive, it might discourage work, it’s not necessary given current welfare programs, and “Bill Gates would get 13k, which is crazy.”
Nonetheless, it’s striking that many explanations of “Disagree” responses did not criticize UBI per se, and were sometimes even implicitly (or explicitly!) supportive.
Not all respondents gave explanations of their answers. However, looking through the list of economists surveyed, it’s further notable that the Murray-inspired UBI proposal elicited disagreement and uncertainty from some others who have previously expressed support of basic income. For instance, the Nobel Laureate Angus Deaton voted “Disagree”, despite having recently come out in favor of “basic income grants”. Even distinguished MIT Professor Abhijit Banerjee — who is an advisor for GiveDirectly’s basic income pilot and recently wrote a compelling case for UBI in The Indian Express — voted “Uncertain”.
Thus, supporters of UBI — and especially those on the left-side of the political spectrum — should not be discouraged by this particular poll, despite its purportedly showing that only 2% of a forum of economics experts “support a universal basic income”.
If there’s anything to concern us about this survey, it should be the implicit conflation (in its headline) of the general idea of UBI with Charles Murray’s specific, and very controversial, proposal.
On the other hand, the economists themselves do not make this conflation — and, indeed, their responses serve as a reminder of the danger of tying the idea of UBI to any one particular policy implementation.
As basic income researcher Jurgen de Wispelaere writes in a recent blog post,
Agreement at the level of the general idea amongst opposing political factions is often hailed as a virtue of the basic income proposal. However, once we move from idea to policy implementation, persistent disagreement may return with a vengeance.
This is an important message, and one which the IGM Forum survey illustrates well.
Reference:
“Universal Basic Income,” IGM Forum, Chicago Booth, June 28, 2016.
Thanks to Asha Pond for reviewing a draft of this article.
Thanks to my supporters on Patreon. (To see how you too can support my work for Basic Income News, click the link.)
by Kate McFarland | Jul 1, 2016 | News
Varun Gandhi, Member of Parliament of the Bharatiya Janata Party (BJP), has endorsed basic income in an article published in The Hindu on June 30, 2016. The BJP, the ruling party in India, is the largest political party in not only India but (as of March 2015) the world, with 88 million registered members.
In his article, Gandhi calls for more basic income studies to be conducted in India, and delineates an impressive list of benefits that he expects from the policy:
A regular unconditional basic income, scaled up through pilots, and rolled out slowly and carefully, seems ideal for India. It can help improve living conditions including sanitation in our villages, providing them with access to better drinking water, while improving children’s nutrition. Regular basic income payments can help institute rational responses to illness or hunger, enabling households to fund their health expenses instead of encountering a vicious cycle of debt. It can help reduce child labour, while facilitating an increase in school spending. It can transform villages, enabling the growth of productive work, leading to a sustained increase in income. It could cut inequality; grow the economy; all while offering the pursuit of happiness.
Varun Gandhi has nearly 270,000 followers on Twitter and over 3 million Facebook fans.
Feroze Varun Gandhi, “Why we need to talk about a basic income,” The Hindu, July 1, 2016.
Image from Varun Gandhi’s life in pics (NDTV)
Thanks to my supporters on Patreon. (To see how you too can support my work for Basic Income News, click the link.)
by Kate McFarland | Jun 30, 2016 | Opinion
Oxford Fellow Max Harris presents an argument that a universal basic income (UBI) could contribute to loneliness. The argument as given, however, seems to rest on misconceptions about what a UBI would and would not do, and even in its strongest form does not give us reason to reject a UBI.
Would a universal basic income exacerbate loneliness?
This is the question posed by Max Harris, an Examination Fellow at Oxford’s All Souls College, in a recent article for openDemocracy.
In Harris’s assessment, there are two ways in which a universal basic income might contribute to loneliness:
- A UBI “removes the social interaction that some people gain from employment.” Harris worries that recipients of the UBI would “curl up in individualist cocoons” rather than initiating social contact, since they have already been conditioned by the norms of a society in which interpersonal contact has become limited (“we email people who sit in the same office as us, for example, and often text people over talking to them in person”).
- A UBI by itself does not provide any “accompanying public infrastructure to underscore the value of community.” It is, of course, an investment directly in individuals — not in, say, community programs or public parks, libraries, or recreation centers.
Harris himself does not endorse the conclusion that, as a matter of fact, a UBI would make us lonely. Indeed, he does not take a firm stance on whether it would or not. His objective is merely to raise the concern.
As Harris points out, citing basic income proponents such as Scott Santens and the UK think tank Royal Society of Arts (RSA), one can also make a case that a UBI should be expected to foster social relationships. After all, if people are liberated from dependency on full-time paid employment, they would be able to spend less time in jobs that are themselves socially isolating — as some jobs surely are — and more time “pursuing communal projects” outside of work.
According to Harris, the question is in part empirical: we won’t know whether a UBI increases loneliness in society, or whether it reduces it, until it is actually tested.
A Non-Empirical Assessment
I want to offer a counterpoint to Harris’s loneliness worry that differs slightly from the brief pro-UBI response entertained in his essay.
It’s no doubt correct that some office work does inhibit individuals from engaging in community projects (a point that Harris attributes to Santens) — or, for that matter, prevent individuals from spending time with friends and family — but it’s a bit beside the point to argue about whether jobs facilitate valuable social interaction or whether, more often, they just get in the way. Presumably, there are jobs of each type. The key point here is that a UBI would provide options: with a UBI, a worker can choose to say at a job, or a worker can choose to quit (perhaps for the sake of engaging in some communal project).
Contra Harris, I believe that we don’t need an empirical study to demonstrate the flaws in the argument that “a universal basic income would make us lonely.” The argument, as he presents it, is a non-starter.
Look again at his two major concerns: (1) a UBI removes the social interaction gained at a job, and (2) a UBI offers no infrastructure to replace this lost interaction.
Credit: The Open University via flickr
The first of these premises is plainly false, and it doesn’t take a pilot study to see why: receiving a basic income does not prevent an individual from also continuing in paid employment. Thus, there is no sense in which a UBI “removes” the social interaction gained at a job; it does not even remove the job!
Indeed, one oft-touted benefit of basic income is that, because a UBI is not means-tested, it is not a disincentive to work (in contrast to most existing systems of welfare, in which benefits vanish if a receipt receives a job or earns income above a certain amount). Despite loose talk in the media about “paying people to do nothing” and “giving people money not to work,” receipt of a basic income is not conditional on quitting work (obviously); quite the contrary.
We might assume that people are able to recognize whether their jobs provide a valuable source of social interaction and connections — and that, if this is so, they will retain their jobs even if UBI came to be. (I will, though, revisit this assumption shortly.)
To be sure, UBI is often discussed in parallel to forecasts of mass unemployment (e.g., especially, due to automation). In the scenarios envisioned, many workers will lose their jobs — but, of course, this job-loss is not due to UBI. A UBI, insofar as it’s in the picture, is there to offset one of the worst effects of joblessness: loss of income. By itself, it is not meant — and should not be expected — to replace all aspects of the lost jobs. A UBI “merely” ensures that displaced workers won’t have to worry about paying for food or rent, thereby providing a foundation that allows us to focus on concerns at higher levels of Maslow’s hierarchy — such as how and where to find social interaction.
This leads to the second concern raised by Harris: a UBI does not provide alternative infrastructure for social interaction. Here, I think that we should accept Harris’s claim, but we should question its relevance.
It’s true that a UBI does not by itself provide schools, parks, or community programs; it also does not cure for cancer or end warfare. It would be patently absurd, however, to oppose UBI on the ground that it does not achieve the latter goals. A UBI might accomplish a lot, but it is not a panacea; no advocates take it for one.
Credit: Valerie Shane via flickr
We can even grant that the development and enrichment of the commons is a goal that we ought to pursue in conjunction with a basic income.
Guy Standing, for example, incorporates a call to protect and revive the “physical, social, and information commons” as part of his Precariat Charter (immediately after his proposals for basic income and sovereign wealth funds, as it happens).
And Harris himself describes the RSA’s idea for a “public contribution contract” to be introduced alongside of a basic income, by which individuals express commitment to contribute to their communities.
As an argument against basic income, Harris’s loneliness worry holds no water. At most, it is an exhortation to UBI proponents not to forget about parallel programs, such as the construction and enhancement of public spaces, that could foster social interaction and community well-being.
A Concession and Response
Credit: NoirKitsuné via flickr
I do, though, want to offer an important caveat. Above, I suggested that individuals can recognize when the social interaction fostered by a job is beneficial to them, and that they will act accordingly. But, in fact, I think it’s quite probable that there are some individuals who — were they to receive a basic income — would leave their jobs and cocoon themselves in their homes, even if doing so would not be in their overall best interest. A guaranteed income could indeed be the catalyst that drives some individuals into a voluntary, but potentially harmful, life of isolation.
What sorts of individuals? There might be some who would intentionally avoid social interaction as a consequence of mental illness, such as social anxiety or depression. Meanwhile, others might quit their jobs to pursue passions that just happen to be solitary (whether writing, painting, computer-programming, or what have you). After all, one major talking-point in favor of basic income — and one with which I wholeheartedly agree — is that the policy would allow individuals to quit their jobs to pursue their passions. The loneliness worry might well arise, however, when a naturally introverted person engages herself in an inherently solitary pursuit; even if avoiding social interaction is not her goal, it might be her natural inclination — an inclination that would be unthwarted if paid employment is not necessary to make a living.
Against Harris, perhaps, I believe that the loneliness worry would be greatest for those people who don’t avidly desire social interaction — for they are the least inclined to be proactive in ensuring that they receive a healthy dose. (Harris states, “While some individuals might enjoy this time on their own, others might feel isolated by this lack of social contact,” which suggests that he forecasts that those who crave social contact will be the hardest hit.)
Would this problem arise under a UBI? If so, how big of a problem would it be? These, I think, are indeed empirical matters.
But a better question for our purposes is this: if there is a risk of the type of self-induced loneliness that I’ve described above, would this be a reason not to favor a UBI?
And here I think that the we can, with some confidence, answer no.
Consider an analogy. Presumably, there are people in industrialized nations who currently receive very little physical activity, and who would receive more physical exercise were it not for the mechanization of labor. (Perhaps, say, they’d work in the field instead of sitting at a desk.) Such individuals could hit the gym after work, or ride a bike to the office instead of driving a car, or jog in the morning, or so on; however, because exercise is not required to make an income, many opt out, despite acknowledging that they’d be healthier if they moved around a bit more.
Nonetheless, it would be inappropriate to attempt to impede progress (e.g., by banning mechanized agriculture) simply because some percentage of the population is disinclined to exercise unless their life and livelihood depends on it. Such a reactionary policy would be not only unfair to society as a whole but also condescending and paternalistic to those it endeavors to help. A better approach might be to make other options for physical activity more accessible (e.g., say, installing bike lanes, funding parks and community recreation centers, or sponsoring free fitness classes).
Likewise, the possibility that a UBI would lead some to reduce their amount of social contact — even if this possibility is likely — is not a good reason to deprive society of the myriad benefits that would be bought about by a UBI. That said, there is likely little harm in preparing for this contingency by thinking of ways of encourage social contact in a world with less work (or, perhaps more accurately, less mandatory paid employment), such as by expanding and protecting commons areas.
Max Harris, “Will the Universal Basic Income make us lonely?” openDemocracy, May 25, 2016.
Feature Image via Chris de Nice (flickr)
Thanks to Dave Clegg for reviewing a draft of this article.
Thanks to my supporters on Patreon.
