by Tyler Prochazka | Mar 27, 2017 | News
The Universal Basic Income in the Asia Pacific international conference was held at National Chengchi University (NCCU) on March 18. This was the first conference dedicated to universal basic income (UBI) focused on the Asia Pacific region. Scholars, activists, officials, and guests traveled from all over the world to participate in the event.
All livestream videos are available on the UBI Taiwan Facebook page, and a HD version will be available shortly on UBI Taiwan’s YouTube page.
Around 100 people participated in the event in person, including participants who flew from America, Switzerland, Australia, South Korea, Singapore, and mainland China. There were nearly 1,000 streams of the Chinese-translation broadcast of the event, and there were over 1,200 views of the livestream videos on Facebook. A total of 16 different sessions were held, with over 100 questions posed to the UBI experts in-person and online. Furthermore, the event page has reached 35,000 unique viewers to date.
Enno Schmidt, leader of the Swiss referendum campaign, gave the keynote speech for the event: “Basic Income and Democracy.”
“The Asia Pacific UBI conference undoubtedly has been one of the historical steps in furthering the worldwide UBI movement, focused on the recognition of Asia Pacific, as well as unity and collaboration,” Schmidt said.
The event has been in preparation since November, when organizer Tyler Prochazka, an NCCU International Master’s Program in Asia-Pacific Studies (IMAS) student and features editor of Basic Income News, received a grant from the US State Department’s Critical Language Scholarship Alumni Development Fund along with James Davis, a junior from Columbia University. NCCU’s College of Social Sciences (CSS) later agreed to sponsor the event, and NCCU’s IMAS department provided additional assistance.
NCCU CSS Professor Ping-Yin Kuan provided the welcome speech for the event, where he discussed how he first learned about the idea of UBI while he was studying in the United States. His master’s thesis advisor was involved in the “Income Maintenance Experiment” in New Jersey, which tested a form of negative income tax in the 1960s and 1970s.
“As a student who came from Taiwan – at that time Taiwan was a relatively poor country – I was amazed by such a crazy idea. And I thought that only the US, a rich country, would come up with such a scheme,” Kuan said.
“After I became more familiar with issues of social inequality, I could see that it was not a crazy idea at all. The question that should have been asked then, and I believe should still be asked now, is why a country as rich as the US allows a significant proportion of its people to live below a basic decent condition,” Kuan expanded.
“Now Taiwan is considered a rich county, and we can certainly ask the same question here.”
Conference co-organizer James Davis prepared a documentary for the conference, meeting with prominent figures in finance, technology, and politics to discuss basic income.
“Universal basic income is the future of redistribution and welfare policy. It has the potential to alleviate global poverty and unleash an entrepreneurial spirit unlike anything we’ve seen before. These interviews explore the practical and ideological grounds of universal basic income, debunking the critics, and anticipating its challenges,” Davis said.
Sarath Davala, a researcher on the Indian basic income trial, presented on the “Transformative Power of Basic Income for India” via Skype.
“Universal basic income is the most radical idea of our contemporary times. It takes the discourses of democracy and poverty to the next level,” Davala said. He noted that UBI Taiwan “has created history by organizing the first regional activity in Taipei.”
“This conference is the foundation for future cooperation at the regional level, which is very much needed to take forward the basic income movement in each of the countries in the Asia Pacific region,” Davala said.
Ping Xu, coordinator for UBI Taiwan and co-organizer of the conference, presented on the feasibility of basic income for Taiwan.
“This is the first step for basic income in the Asia Pacific. It represents an awakening of human evolution toward traditional Asian culture and away from our current inhumane working standards,” Xu said.
Joffre Balce, secretary of the Association for Good Government in Australia, presented on “Rewriting the Textbook to Deliver Universal Human Dignity.”
“The first Asia Pacific Conference on Basic Income was a glimpse of how society can work together for a common vision — bold, innovative, diverse yet respectful of each other’s noble intentions, united in efforts and determined to realize each other’s vision for a society of equality in rights, the self-determination of the individual and the freedom to cooperate for a better society,” said Balce.
Ted Tan, the coordinator for research and information for UNI Asia and Pacific Regional, flew from Singapore to attend the event. He said he “hopes there will be another conference next year.”
“The conference was very interesting and it could have easily been extended for another half or one day. There is still much to discuss on the possibility of a universal basic income in this region, so I appreciate the inputs and sharing of all the experts in the same room,” Tan said.
Chung Yuan Christian University provided simultaneous Chinese translation for the event. Enzo Guo, a Taiwanese senior at Chung Yuan, led the group of translators.
“I felt so honored to interpret for those brilliant scholars with their ideas and findings. I benefited greatly by their talks. These are important matters that people living in Asia Pacific should know,” Guo said.
Musician Brandy Moore also provided her song “Just Because I’m Alive” for the conference and its promotional videos. Moore wrote the song after hearing about basic income in 2015 and performed it at a basic income conference in 2016 for the first time. In June, Moore will perform the song at NABIG 2017 in New York City.
“Being invited to put my song forward to be part of this recent basic income conference held in Taiwan was a wonderful additional surprise,” she said.
“Music reaches people on a heart level and it’s going to take both heads and hearts to make basic income a reality,” Moore said.
Purchases of Moore’s song will help fund basic income organizations after she recoups the funding to produce it.
Julio Linares, an NCCU student from Guatemala, had met many of the presenters at the BIEN Congress in South Korea, where he also presented.
“I argued how a Basic Income Fund (BIF) could work as a way of creating long-term investments whose profits are redirected back to people in the form of a monthly basic income while at the same time making the fund financially sustainable over time,” Linares said. “The attendees were not only from Taiwan but from different countries and they all showed great interest in the topic as it raised quite a lot of discussion.”
Petra Sevcikova, an NCCU IMAS student from the Czech Republic, organized the NCCU volunteers for the conference.
“After working in event management in Europe, helping to organize the UBI Conference in NCCU in Taipei was a new and extraordinary experience. I believe that the conference was unique and quite important for people interested in the basic income,” Sevcikova said.
Speakers included Gary Flomenhoft (University of Vermont, USA), Sarath Davala (India), Julio Linares (NCCU), Gregory Marston (University of Queensland, Australia), Joffre Balce (Australia), Munly Leong (Australia), Toru Yamamori (Doshisha University, Japan), Ping Xu (Taiwan), Enno Schmidt (Switzerland), Hyosang Ahn (Basic Income Korea Network), Cheng Furui (Chinese Academy of Social Sciences), and Tyler Prochazka (NCCU). The abstracts for each presentation can be found here. A compilation of the research will soon be published online.
For Kuan, bringing these scholars to Taiwan will help to highlight the important issue of inequality, as many social welfare systems in the Asia Pacific are “not working effectively.”
“It is important to bring regional scholars to share knowledge about basic income and spark new ways to think about social security. This is particularly important, not just in Taiwan, but the Asia Pacific in general,” Kuan said.
Yamamori presented on “What Can We Learn From a Grassroots Feminist UBI Movement?: Revisiting Keynes’s Prophecy” via Skype.
“While I was able to attend only via Skype, I could still feel positive vibes and energy from the venue. I know Tyler, Ping and others made a huge effort to make this conference successful,” he said.
“Let me show my gratitude to them and participants, and let us go forward for an unconditional basic income together,” Yamamori said.
Guo said he is optimistic that the conference will have a big impact on Taiwanese society.
“By gathering the elites and people from different fields together and discussing with each other, I believe this conference has undoubtedly paved the way for the popularization of UBI in Taiwan,” he said.
When reflecting on the potential of the UBI in the Asia Pacific, Schmidt said it can bring together all people from all backgrounds, both in the Asia Pacific and beyond.
“The idea of an unconditional basic income for everyone must remain clear, which is regardless of any life circumstances, rich or poor, beautiful or ugly. This idea does not exclude anybody, it does not fight against anything. The idea of UBI unites and connects people and restores our forgotten values,” Schmidt said.
by Stanislas Jourdan | Mar 25, 2017 | Opinion
Spurred by Milton Friedman, the concept of “helicopter money” – under which central banks would distribute money to citizens – is making headway in economic debate, but is often confused with the idea of basic income. This article intends to clarify the distinctions and overlaps between these two concepts.
“Let us suppose now that one day a helicopter flies over this community and drops an additional $1,000 in bills from the sky, which is, of course, hastily collected by members of the community. Let us suppose further that everyone is convinced that this is a unique event which will never be repeated.”
When Milton Friedman wrote those lines in 1969, he probably never thought that “helicopter money” would become a buzzword in the 2000s post-crisis era. Friedman’s thinking was indeed quite radically unorthodox. How did the prominent neoliberal advocate come to suggest people should receive free money and that we would all be better off as a result? Far from philanthropic thinking, Friedman was in fact simply trying to illustrate his theory of the neutrality of money. If you need to make more money, you should consider renting out your spare room.
What would happen if we were to drop freshly printed notes over a population from a helicopter, just like rain? Nothing other than inflation, suggested Friedman, one of his main beliefs being that any increase in the money supply automatically leads to a proportional increase in consumer prices. Through this thought experiment, Friedman drew the conclusion that central banks can always avoid deflation by producing money and causing it to circulate in the economy.
In fact, however, the idea that we could create money and distribute it to the people goes back much farther than Friedman. In 1924, British engineer Clifford Hugh Douglas elaborated his theory of the “social credit”, its main component being the distribution of a monthly “national dividend” generated from money creation, the level of which would vary according to national production.
Although Douglas did gain some notable following at the time, especially in Canada, the idea was ultimately consigned to the oubliettes of history, leaving Friedman with the alleged paternity of the idea, centre-staging the helicopter analogy with it.
The concept wasn’t much thought of for 30 years following Friedman’s discussion, however, and it might have been forgotten again if it hadn’t been brought back to public attention in 2002 by one of the most influential voices of monetary policy. In a famous speech, the Federal Reserve chair Ben Bernanke alluded to this concept, making the case that, under important deflationary trends like that seen in Japan, the central bank could resort to helicopter money-style instruments to achieve its 2% inflation target.
Yet, far from initiating serious consideration, these remarks only caused Bernanke to endure mockery and “helicopter Ben” as a persistent nickname.
This is probably because the concept runs counter to the whole ideological turn of the 20th century in terms of monetary policy. Starting from the 50s, money creation has been gradually shifted from the sphere of public sovereignty into the quasi-monopolistic realm of the private banking sector. This process ultimately resulted in the outright prohibition, in most jurisdictions, of monetary financing of government budgets. Helicopter money sounds very much like a reversal of this trend, and a dangerous one to the ears of many mainstream economists.
An alternative form of money creation
There is recurring confusion around the exact meaning of helicopter money, which is probably caused by the simple fact that the alleged proponent of the idea, Milton Friedman, never seriously intended to implement it.
Thus, the concept finds itself often described in very diverse terms, ranging from the old-fashioned monetization of public debt to its purest form (and probably the one Friedman actually had in mind): the distribution of money directly to all citizens by central banks. The latter will be the one we assess in this article.
Helicopter money can thus be defined as the creation of money, without corresponding assets, and its distribution into citizens’ bank accounts.
It is therefore an alternative form of money creation, which is strictly different from the most common way in which money is created today: through the banking sector’s credit issuance functions. It is worth clarifying this point here: as the Bank of England has clearly demonstrated, today’s monetary supply is almost entirely controlled by private banks issuing credit into the economy. This is sometimes referred to (somewhat misleadingly) as the “fractional reserve banking system”. Although the benefits and pitfalls of such an arrangement are subject to never-ending controversy between academics, the way in which this system functions is nowadays largely undisputed.
Money tree sculpture in front of the Central Bank of Ireland.
The key advantage of helicopter money resides precisely in the fact that it would bypass banks as money creators, and is therefore one way for the central bank to maintain the money supply regardless of whether banks play their role as suppliers of money into the economy. In its purest form, helicopter money also bypasses governments’ treasuries, and is therefore not legally prohibited under the monetary financing rule (Art. 123 of the EU Lisbon Treaty).
A second clarification is also required at this point: helicopter money is also different from the so called “quantitative easing” (QE) policies that have been implemented by several central banks, although they pursue a similar objective: boosting the money supply to avoid deflationary pressures.
Under QE, central banks create money (the so called central bank’s reserves) and mobilize those reserves to purchase financial assets on a large scale and over a certain period of time. Usually, central banks purchase sovereign bonds with the intention of pushing down interest rates on those bonds, to encourage the financial sector to move away from investing in sovereign bonds and to instead lend money to riskier projects under the so-called “portfolio rebalancing effect”. This type of money creation is therefore targeted to the financial sector, with assets as collateral on the central bank’s balance sheet and, more importantly, is a temporary operation: the central bank destroys the money once the bonds it holds come to maturation.
Helicopter money is therefore very different from QE. In fact, it is precisely because of the many shortcomings of QE that helicopter money is being presented by a growing number of people as a superior alternative.
Helicopter money as an alternative to quantitative easing
The assessments of QE programmes in the US, Japan, and the UK have been subject to a wealth of contradictory conclusions. In Europe, the ECB’s QE programme was first applauded as progress, after years of speculation and resistance to implementation of QE when it was desperately needed – when the Greek crisis hit. However, it is becoming clear that QE recipes, in Europe and elsewhere, never really do the trick.
Generally speaking, QE does cause lending conditions to improve, but it does not automatically lead to an increase in bank lending. In other words, the “transmission channel” of monetary policy does not work so well under QE. To be fair, this is not the banks’ fault: there is little banks can do when conditions are so bad that virtually no companies or households want to take on debt because the economy is already over-indebted.
Economists talk of a “liquidity trap” whereby injections of cash into the private banking system by a central bank fail to stimulate the real economy. QE doesn’t overcome this trap.
Even worse, QE is often accused of creating asset bubbles and increasing wealth inequality, because the massive injection of money is narrowly targeted towards financial asset disproportionately owned by the rich. The Bank of England itself estimates that its own QE programme has increased by 40% the wealth of the richest 5% of Brits.
Against this background, helicopter money is experiencing a comeback, perhaps with even more strength than Friedman could ever have imagined. Since the start of the crisis, prominent economists and commentators, including Martin Wolf, Steve Keen, Anatole Kaletsky, Willem Buiter, Adair Turner, John Muellbauer, Bradford Delong and Martin Sandbu, have advocated for central banks to implement some form of helicopter money. Anatole Kaletsky and Steve Keen almost simultaneously proposed re-branding the concept “QE for People”, which later became the name of a European campaign (for which the author currently works).
Conference about “Quantitative Easing for People” at the European Parliament
The case for QE for People is quite straightforward: since the banking sector is not currently able to “transmit” the central bank’s monetary policy accommodation by increasing their loan’s issuance, why shouldn’t the central bank do it by itself? If the main task of central banks is to maintain inflation at around 2%, certainly the most effective way would indeed be to distribute money to people so they can spend it.
The debate on helicopter money took another turn when it was mentioned by the ECB’s chief Mario Draghi, under the spotlights of a press conference on March 9th 2016 and later by other senior ECB officials. “Helicopter money is a very interesting concept” Draghi said, while adding that the idea was not yet being considered by the ECB. Whether one think this was sincere curiosity or a clumsy statement on Draghi’s part, the fact is this single sentence provoked a historic tide of comments and debate on the idea, including within policymaker spheres.
How about basic income?
Similarities between helicopter money and basic income have led some commentators to offer very confused explanations, claiming, for example, that Finland was already undertaking a “helicopter money” programme (the basic income experiment).
Undeniably, there are resemblances between the two concepts, as both involve making unconditional payments to all citizens and usually without means-testing. Basic income’s principles of universality and unconditionality can also be found in helicopter money.
Key differences quickly emerge under careful analysis, however. Under a helicopter money regime, there is no clear commitment from the central bank to make payments periodic. Quite the contrary in fact, as most proponents of helicopter money (read the prolific Eric Lonergan for example) are keen to be clear on the fact that this should be an exceptional measure, to be used on a one-off basis, with the possibility (but not the commitment) to renew if necessary.
There is nevertheless some theoretical overlap with basic income. In addition to Douglas, several key advocates of basic income have put forward the case that money creation could be used to finance the benefit, either as a “boot” phase or as a way to supplement the fiscal means to finance basic income schemes. The French economist Yoland Bresson made the case that perpetual low interest sovereign bonds could be used to kick off the basic income in a first stage, thus leaving time for the government to implement all the necessary reforms of the tax-benefit system to make UBI fully functional.
These theories relate to the understanding of basic income as a mechanism of pre-distribution (as opposed to redistribution), whereby basic income is a recognition of the intrinsic value of all participants in society, or even as common inheritance. If all citizens create value “because they exist”, then it makes sense to “pre-validate” this economic value using money creation. If we are all richer today because of our predecessors’ work and heritage, then one can argue that more money should be introduced into circulation to recognise this added wealth.
These are, however, only marginal justifications today, put forward to support neither helicopter money nor basic income. Beyond some theoretical common ground, the differences between the two policies are most clear when one understands that they pursue different objectives.
Put simply, helicopter money can be framed as a punctual measure (extreme, one may say) with a rather narrow purpose: to stimulate economic activity by boosting people’s incomes under some strict circumstances, that is, when the economy is under threat of deflation.
Basic income, on the other hand, pursues a very wide range of objectives from poverty alleviation to work emancipation, gender balance incentivization, social protection modernization, more aggressive redistribution and so on. In contrast, stimulating people’s purchasing power is certainly not the main argument for doing basic income.
From those different objectives also stem different institutional frameworks. If the objective of helicopter money’s proponents is merely to stimulate demand, then transfers to citizens is only one practical means by which to achieve this single clear goal. From this viewpoint, it also makes sense to give independent central banks the legal capacity to distribute a citizens’ dividend as a new instrument in the monetary policy toolbox.
If basic income pursues more numerous and complex objectives, by contrast, it then makes sense that it should be the responsibility of elected governments to design and implement it, just like any other fiscal policy.
In conclusion, helicopter money could be seen as one of many “partial basic income” proposals: schemes that share some of the characteristics of basic income but not all of them. Yet given the very clear institutional distinctions just covered, it does not make sense then to associate too closely the two concepts. In this light, it might be more meaningful to refer to helicopter money payouts as “social dividends” or “monetary dividends” as opposed to “basic income”.
Can helicopter money lead to basic income?
Despite all the institutional and practical distinctions drawn above, it is quite enlightening to recognize the political porosity between the two proposals. Helicopter money proponents tend to also favor basic income (though not all do) and vice versa.
This is probably because the two ideas, to some extent, share some common strategic interests and help one another in the struggle for cultural acceptance of each proposal, especially in regards to unconditionality and the disconnection of money from labor.
From a basic income viewpoint, the rise of the helicopter money discussion is a useful addition to basic income’s financing question. If central banks can create money, then surely it would be easier to finance a basic income.
On the other side, it is also convenient for helicopter money proponents that the basic income discussion is making headway in the argument for universal payments to citizens: it levies an important moral blocage.
Even more strategically, perhaps, there is a case for seeing helicopter money as a necessary step to the implementation of a full-fledged basic income policy.
This is a particularly relevant argument when it comes to the European Monetary Union, which is currently deprived of any significant common fiscal policy. Because of this, it will probably take years before we might see something like a eurodividend (an EU basic income scheme financed by an EU budget) as articulated by Philippe van Parijs.
Speech by Philippe van Parijs on the Eurodividend at the European Social and Economic Committee in Brussels.
To circumvent this cumbersome and very long-term political route, Slovenian economist Jože Mencinger has repeatedly suggested the use of helicopter money as an “ideal experimental possibility” to kick-start a form of basic income in the EU.
Instead of QE, the ECB could start a helicopter money scheme by giving 200 euros per adult citizens for one year – no strings attached, no taxes involved, simply courtesy of the ECB’s (digital) printing presses. This would involve about three times less money printing than under QE and yet would be more likely to fulfill the ECB’s objective.
If this works and garners favorable public opinion, there would be even greater political momentum for implementing something like a permanent eurodividend scheme. The ECB’s temporary scheme would allow some time for EU policymakers to create the institutional and fiscal infrastructure for such a eurodividend to be functional.
In the long run, nothing forbids us from thinking that the ECB could permanently fund such a eurodividend scheme at a certain level, as Kevin Spiritus and Willem Sas have sketched. Yet such funding cannot be seen as an obligation for the ECB under the current legal framework. More intellectual debate will be required before policymakers come to the conclusion that some form of permanent helicopter money is necessary and desirable.
There is still much work to be done before either basic income or helicopter money can be put in place. However, 10 years after the financial crisis, it is clear that central banks’ models have not delivered as they were expected to. There is clear mismatch between the massive size of their balance sheet interventions and the bleak outlook of the economy.
There is a growing case that the whole central banking theoretical framework must be revised. Helicopter money is certainly one idea that is usefully challenging the monetary policy status quo. It will surely take another leap of determination and audacity for central bankers to take this step forward, but we should not rule out that it might also be the most pragmatic thing central banks can do at some point in the future. When things get to this point, the basic income movement must stand ready to play its part in facilitating the move towards helicopter money, while making sure to build upon this gigantic central bank experiment towards a permanent and sustainable basic income.
Thanks to Genevieve Shanahan for proofreading this article.
Credit pictures: Courtesy Financial Times; Positive Money, picturesbyJOE, UBI-Europe
by Tyler Prochazka | Mar 24, 2017 | Opinion
This past presidential cycle, libertarian presidential candidate Gary Johnson suggested to BI News that he was “open” to the universal basic income. Johnson’s 2012 running mate Judge Jim Gray recently laid out a proposal for broad reform and simplification of the tax code, as well as providing a guaranteed annual stipend of $15,000. The stipend would be gradually taxed away by 50 cents for each dollar. Those making $30,000 and above would not receive the stipend.
Gray said that his policy would effectively address poverty and is consistent with “liberty” and “compassion.” At the same time, it would remove the poverty traps that people in poverty face.
“Unlike today’s welfare and social security systems, this system always has incentives to work and earn the extra dollar,” Gray said.
The full interview can be found below.
What inspired this idea for the monthly stipend?
I don’t recall specifically. But I have always believed that institutions should regularly be revisited with an eye toward increasing their social incentives. Our tax system is terribly complex and in many ways harmful. If it could be reformed and simplified, that would be a wonderful occasion to address all welfare issues and, along the way, address our homeless problems as well.
Where would the funding come from to pay for the $15,000 stipend?
Abolish all other welfare programs, and all the bureaucracies that go along with them. That should leave plenty of money to support this stipend.
Would there be any targeted programs that would remain, or would they be entirely replaced with the stipend system? For example, medical programs, or programs for the disabled.
The stipend would have to be weighted to address people with truly special needs. In addition, I would also employ a voucher system to facilitate people purchasing health insurance of the private market, based upon a sliding scale for need.
Can you explain the relationship between your proposal and expanding liberty?
Welfare systems are extremely intrusive, and in many ways inequitable. This system would be implemented voluntarily, which is consistent with Liberty, and would be far less judgmental and intrusive – all of which is fully consistent with Liberty.
You said we should have this safety net because “that is who we are.” What did you mean by that?
I believe we Americans are compassionate people. If given a choice to provide for those in need, Americans would choose to assist – as long as they believed this was a workable system, and everyone understood this is not an “entitlement,” but simply compassionate.
How will the private sector respond to this stipend program? What new opportunities or businesses may arise that are not possible now?
Really good questions! I believe the private sector will fully support it, for reasons provided above. And this system would also provide opportunities for people to become involved in the arts, public volunteerism and experimentation with other business opportunities, because it would provide them a back-up safety net to hedge against failure.
Do you think the $15k would encourage laziness? How would people respond to not being forced to work?
We will always have incentives to laziness. But, unlike today’s welfare and social security systems, this system always has incentives to work and earn the extra dollar. Our present systems punish working because recipients lose more money by working than they gain. And it also encourages attempts to “game the system.”
Update 3/27: Clarified the stipend will be taxed away up to $30,000.
by Kate McFarland | Mar 22, 2017 | News
The government of Ontario has released an overview of the results of three months of public consultations on the design of the province’s impending “Basic Income Pilot”.
The provincial government of Ontario, Canada is currently designing a pilot study of a guaranteed minimum income (a “basic income” in its terminology [note]), which it plans to launch in the spring of 2017. On November 3, 2016, project advisor Hugh Segal released the paper “Finding a Better Way: A Basic Income Pilot Project for Ontario” to serve as the focus of discussions on the design of the pilot (see the summary in Basic Income News). Concurrent with the publication of the paper, Ontario’s Ministry of Community and Social Services released a call for feedback from the public via public meetings, online surveys, and written submissions.
Public consultations continued through January 31, 2017, and, in the end, 32,870 people responded to the public online survey, 1193 attended the public meetings, and at least 537 individuals and community groups submitted written feedback–according to a newly released summary of the results of the consultations.
The new report, “Basic Income Consultations: What We Heard” (March 2017), provides an overview of feedback received from the public, although no details have yet been provided as to how this feedback will inform or influence the design of the pilot.
One issue addressed in the consultations was which of the potential measurable outcomes were most important to Ontarians. Segal suggested ten in his discussion paper, and consultations revealed “general agreement” that, of these, four were “particularly important” to residents: health, housing, food, and work behavior.
The level of the minimum income was also a topic of discussion–with the widely announced amount of $1320 per month called into question by some. This $1320 per month amount, which Segal recommended in his discussion paper, was based on a calculation of 75% of the Low-Income Measure (LIM). Some participants in public hearings recommended instead that the minimum income be set at 100% of the LIM.
Participants also discussed the selection of sites for the pilot, with widespread agreement that a variety of locations should be chosen, representing urban, rural, and northern areas, but that the government should also strive to focus on areas of greatest need (i.e. highest poverty rates).
Read about other results here.
[note] As is common in Canada, the Ontario government uses the term ‘basic income’ more broadly than does BIEN. The report above, for example, describes a basic income as a “payment from the government to a person or family to ensure they receive a minimum income level” and lays out several methods of implementing such a policy: “giving the same amount of money to everyone” (i.e. the specific approach that organizations like BIEN refer to as a “basic income”, sometimes also called a “demogrant”), “topping up the incomes of people who earn less than a certain amount”, and “setting up a system where people who earn less than a certain amount get a payment from the government, instead of paying taxes” (i.e. a negative income tax).
Often, ‘basic income’ is used to refer specifically to schemes in which all members of a community receive an equal amount of money, paid to individuals, while a term like ‘guaranteed minimum income’ is applied to the broader category of “payment[s] from the government to a person or family to ensure they receive a minimum income level”. Thus, although the Ontario government has titled its project “Basic Income Pilot”, it might be more accurate to describe it as a “minimum income pilot” to avoid confusion with BIEN’s more specific use of ‘basic income’.
Segal himself strongly recommended that the pilot avoid testing a “demogrant” (“universal basic income”) in favor of a negative income tax. However, as the new report reveals, some participants in the consultations suggested the adoption of a demogrant model.
Reviewed by Genevieve Shanahan
Photo (Ottawa, Ontario) CC BY-NC-ND 2.0 Stuart Williams
by Sarath Davala | Mar 21, 2017 | Opinion
India Network for Basic Income jointly with SEWA Bharat is organising a National Conference on “Basic Income in India” in New Delhi on March 29 and 30, 2017.
This National Conference comes against the backdrop of dramatic new developments in India with respect to Universal Basic Income. As you are all aware, on the 31st of January 2017, a day before the Federal Budget was announced, India’s Finance Minister, Arun Jaitley, presented the Economic Survey in the Parliament. This document is a perspective document presented every year by the Ministry of Finance, as it sees how the economy has fared the previous year, and also what the prospects are the coming year. This year, this document had a full chapter on Universal Basic Income, authored by Arvind Subramanian, the Chief Economic Advisor to the Government of India.
It is a 40-page document which painstakingly goes into a very balanced analysis of how the concept of UBI is relevant to the Indian context. It also lays out the challenges and dilemmas one faces when one applies it to a country as massive as India. The chapter hardly sounds like a government document. The author writes with a certain conviction that Universal Basic Income is a good idea, and that it should be seriously considered.
It is our common experience that when a proposal comes from the government it kicks off a much wider debate than when a citizen’s group like us raises it. And so much better when it is articulated so eloquently, unlike normal government documents. The media was abuzz with all sorts of voices.
Without going much into the contents of the innumerable articles that were written on this proposal, I would like to highlight one important aspect of this debate. Most of the commentators – economists, politicians, citizens’ groups – agree that, in principle, this is a good idea. Their disagreement them come after this point.
Here are some voices of those who oppose:
“It is in principle, a good idea, but…”
“India is not ready for it.”
“India cannot afford it.”
“UBI is a Trojan Horse to dismantle the existing welfare system.”
“This government is going to wash its hands off all its welfare responsibilities.”
“At a time, when a lot of effort is going into reforming the welfare delivery, and there is evidence of improvements across the country, introducing UBI would be ‘disruptive’.”
The arguments of the opponents are not very different from those that are being putforth elsewhere in the world. . Interestingly, these voices have not been very strong in India. Interestingly, all over the world UBI has support from both the Left and the Right. In the same breath, it also has opponents from both the camps. India is no exception.
In any case, the point is, within a short period, the idea has been gaining a great deal of traction in the country. As INBI Coordinator, increasingly I feel that there is now an urgent need for UBI literacy in the country. To tell people what it is about. What it implies for the citizen and for the government.
Given the mind-boggling numbers and fiscal implications, one thread of the UBI argument in India is: In order to make UBI meaningful, should we start with specific demographic groups rather than all citizens? And incrementally move towards “Universal”? If yes, then what should those vulnerable groups be? The tribal population (104 million and about 9% of the population)? Or all women(about 500 million about 48%of the population)? Or the elderly (about 100 million)? Or the Scheduled Caste population(about 200 million)? UBI purists might consider this a dilution of the concept of UBI and a sell out. Be that as it may, that is where the debate is now.
On International Women’s Day (2017) two associations, who otherwise make strange bedfellows, endorsed and appealed for ‘UBI for Women’. Self Employed Women’s association in Madhya Pradesh, and the oldest Industry body in Indi
a, The Associated Chamber of Commerce and Industry of India (ASSOCHAM).
Soon after the UBI proposal was presented in the Parliament, the Finance Minster of the northern-most state Jammu and Kashmir, Mr Haseeb Drabu, announced that the state is ready to implement a UBI. However, this readiness, he clarified, is contingent upon the federal government giving him a ‘go ahead’ because the federal grants form the substantial part of the state’s welfare budget.
It is a matter of time before more state chief ministers begin to see the economic, political and the moral dividends of the policy of Universal Basic Income. In India, the electoral heat and dust never settles. Between any two general elections, we have innumerable state elections or by-elections. People’s verdict is something that continually happens in India. UBI has not yet entered the electoral discourse. The first of its kind came during the recent Uttar Pradesh elections. Varun Gandhi,a two-time BJP Member of Parliament and the first cousin of Rahul Gandhi, wrote an elaborate article offering UBI as a solution to extreme poverty in the state.
Again, it is a matter of time before other politicians catch up.
Well, it is against this backdrop that our National Conference on Basic Income comes at the end of this month. We have tried to get as many voices as possible that endorse and affirm the idea. Along with the major political personalities who have come out in favour of UBI, we are also going to have economists who are engaged in serious calculations and trying to grapple with fiscal and political implications of UBI.
The challenge before INBI thus far has been to talk about the idea of UBI and foreground the evidence from the pilot study that UBI has positive and transformative effect on people’s lives. The challenge now is to work with all the groups and also with different state governments and the federal government to find ways of operationalising the idea. This is not an easy task. But then, that is the task before us now.
