After over a year of avoiding significant local COVID outbreaks, Taiwan experienced a scare in May with hundreds of cases emerging. This brought the idea of universal cash payments to the forefront of Taiwan’s political debate as millions of jobs were destabilized overnight.
With this backdrop, UBI Taiwan held its first-ever online basic income summit on August 15, inviting professors, activists, and politicians from around the world to discuss the state of basic income during the COVID pandemic.
Korea’s Gyeonggi Province Governor Lee Jae-myung opened the summit by noting the importance of the basic income movement in Korea and Taiwan. Lee is currently a frontrunner in the early stages of Korea’s presidential race. He has been called the “Bernie Sanders of Korea” because of his economic proposals.
“When the world is implementing expansive fiscal policy, basic income is gaining attention as the most rational and remarkable way to prepare for the era of the fourth industrial revolution,” Lee said in his address to the conference.
As the former mayor of Seongnam, Lee started a youth basic income program for all 24-year-old youth in the city to receive local currency every quarter. The scheme was shown to improve small business activity in the region. He later expanded the program to the province when he became governor.
Kim Kyeong Soo is part of the Gyeonggi provincial government vision planner. He is the planner of the provincial youth basic income program.
“What we are doing at our expense is to realize the basic social rights of young people,” Kim said in an interview for the conference.
This was a useful model during the COVID crisis because the provincial government was able to quickly expand the program to include all residents of the province during the economic downturn.
Kim also discussed how they increased a myriad of programs during the COVID pandemic and the plans to push for basic income on a nationwide scale.
“We designed it so that it could only be used in stores with annual sales of 1.2 billion won or less, so that the money could be actually revitalized for the small business owners of the real alley economy,” Kim said.
Members of the Basic Income Korea Network Mok Hwakyun and Kim Jae-seop attended the summit for the question-and-answer session. They noted how basic income has become a mainstream topic in Korea.
“The biggest change is that everyone knows about basic income now,” Mok said. “I hope Korea will be the first country” to implement UBI.
Prominent US activist Scott Santens gave a pre-recorded interview for the conference where he discussed the success and failures of America’s massive COVID relief program. One of the biggest changes that has emerged is the Child Tax Credit, which Santens said he believes will get more people on board with a wider basic income safety net.
“I feel hopeful that especially the monthly CTC is going to really change things here and help build momentum for a full UBI here in the US,” Santens said.
Taiwan’s Yangming University Professor Song-Lih Huang discussed the debate between Universal Basic Services compared to basic income. He concluded that UBS does not provide the same level of individual freedom as UBI.
UBI Taiwan Chairman Tyler Prochazka evaluated Taiwan’s COVID relief response and noted the inadequacy and complexity of receiving relief.
The situation became more severe this past May when a local outbreak caused Taiwan to go into level 3 lockdown for the first time during the pandemic. Taiwan is experiencing a bizarre contradiction, where record economic growth is fueled by its strong export sector despite the lockdown for other industries. At the same time, the lockdown has caused Taiwan’s employees to experience their worst economic situation in decades, particularly for the service industry.
As a result of the lockdown, half of Taiwanese experienced wage reductions of 10 to 50 percent, and 74 percent reported some reduction in wages. At the same time, 41 percent said they believed the government’s COVID relief program provided no help. One issue with the relief program is it relies on extensive documentation to prove an individual’s circumstance and can also reject an applicant if a household member has too much money in the bank.
For example, Taiwan’s unemployment had reached 570,000 people and the number experiencing lower than normal working hours had reached nearly one million during the lockdown. However, only 20,000 people were added to unemployment benefits during June which is less than one-fourth of the increased unemployment for that period.
Level two lockdown has been extended until September 6 in Taiwan, which places varying levels of restrictions on how businesses operate and closes some businesses entirely, such as certain entertainment venues. Even as much of the country returns to normal, many businesses will likely experience continued restrictions on their operations as well as reduced demand for the foreseeable future.
Despite one of the worst employment situations in decades for Taiwan, the government has only allocated around 6 percent of its annual GDP on COVID relief this year. Compared to Japan and the United States, which spent between 16 to 30 percent of their GDPs on COVID relief, Taiwan has given significantly less to its citizens as a developed economy.
Taiwan’s ruling party Democratic Progressive Party is moving toward another round of stimulus coupons worth 5,000 NT ($180 USD). Due to the stringent conditions associated with COVID relief programs, the universal coupons are the most accessible program from the government’s COVID response for many families. There has been a strong push by opposition parties in Taiwan to provide cash relief now for most Taiwanese instead of coupons and use the administrative savings to give an additional cash boost to poor households.
“Taiwan’s ruling party said they want to ‘share economic growth’ with all Taiwanese,” Prochazka said. “The real way to share economic growth is with Universal Basic Income.”
Workers aren’t working for the wages we’re offering as much as they used to. Five million fewer Americans are working now than were working in June of 2019. That’s 3.33% of the U.S. labor force—a shortage! Think about what that means: 3.33% fewer pool boys at the spa, 3.33% fewer caddies at the country club, 3.33% fewer ball girls at the tennis club. Just the other day, I had to wait more than 30 minutes for my lobster bisque. Today, I called my service, and they couldn’t schedule anyone to clean my house until the middle of next week! If this keeps up, who’s going to iron my shirts? It’s a crisis.
All this is happening even though most businesses are still offering a very generous $7.25 per hour and, in some cases, even more. At that rate, a single parent only needs to work one-and-a-half jobs to get herself and her child out poverty. Then she’ll only need two more jobs to pay for the childcare she needs for the time she spends at her first job.
Despite this wonderful generosity, some workers have the audacity to suggest employers could end the labor shortage by paying higher wages. Some even suggest improved working conditions. That’s class warfare! We don’t need that radicalism here.
I suggest a simple solution—a small extension of our well established way of doing things—and it will literally eliminate the labor shortage in 5 minutes.
Privatize the atmosphere. The problem with the air we breathe is that nobody owns it! People take it for granted that they can inhale air any time they feel like it as if they have some natural right to breathe. That’s communism! And that never works. Poor people won’t appreciate the air they breathe until they pay for access to it from a corporation, until they know the police will arrest them if they steal the air from its natural owner—the American corporate sector.
This simple solution is in accord with the American way of doing things. We don’t usually give anything to poor people unless they work for it or prove they can’t work. Why are they getting such a valuable thing as breathing rights for free? Because they need it? People need food, shelter, and clothing; we don’t give them access to the resources they need to produce these things for themselves. Only naked savages do that. In civilized countries like ours, people don’t get access to the resources they “need” until they go to a boss and say I will work for you all day to get the money to buy the stuff I need to live.
Bitch Bastardly
This free atmosphere policy is unnatural and unamerican.
Imagine what a privatized atmosphere will do for the labor shortage? Once workers who are “looking for a better job offer” lose the right to inhale and exhale without the permission of the owner of the atmosphere, they’ll learn the truth of my motto, no job is a bad job, right quick. Like a good member of the lower class, they’ll do what they’re told and they do it in five minutes. If they don’t do it, they pass out and die. But that’s their choice. That’s what freedom in the free market is all about. People who don’t own resources, choose to work for people who do, or they choose not to use resources. If that means homelessness, hunger, or malnutrition, that’s their choice. This simple solution simply adds another choice: suffocation.
Imagine all the jobs a privately owned atmosphere will create in the banking sector as workers who can’t find a job before they pass out seek loans to buy breathing rights? Years of interest payments and collections will follow, generating banking sector profits that will trickle down to everyone.
The atmosphere’s new corporate owner will really clean up our environment. They’ll use their Supreme-Court-given free-speech rights to make all the campaign contributions it takes to get Congress to pay them money to remove pollutants from the atmosphere they own. And think of all the jobs that will create!
They’ll file suit in federal court to get the police to stop polluters. Right now, the government allows polluters to dump dirty chemicals into the air whenever they want. If the atmosphere was owned—as nature intended—by a wealthy campaign contributor, the government would stop polluters. No one has the right to dump pollution into the atmosphere you breathe unless they pay for that right from a private, for-profit corporation.
When corporations own resources, the consumer is sovereign, so you’ll be free to choose exactly how much pollution would get into your lungs. If the people want cleaner air, all they need to do is use their combined bidding power to make it more profitable to sell them clean air than to sell polluters the right to dirty up the air. If you think global warming is real, you can offer money to the corporation to get them to stop that too. It’ll be an old-fashioned bidding war, you versus the polluters, and may the deeper pocket win—it’s the American way.
And the best thing is that, whoever wins, the atmosphere-owning corporation will make lots of money, and that’s good for everybody, because what will they do with that money? They’ll spend some of it and that will create jobs. They’ll invest the rest and that will create even more jobs!
And what will people do with all the money they make in those jobs? They’ll buy the right to breathe, of course. But when they get home and take a deep breath, they’ll know they earned it, because they bought it from whatever corporation owns the right to tell them it’s OK to breathe. That’s the freedom of the free market. -Bitch Bastardly, June-July 2021
For information about the Indepentarian blog, contact Karl@widerquist.com For information about Bitch Bastardly, just make it up.
Michael j. Sandel has written a book about the deep causes of the inequality that is a key driving force behind the populist backlash of recent years. His analysis serves as a basis for justification of the introduction of a universal basic income. For the complete review, see: https://basisinkomen.nl/wp-content/uploads/Book-Review-Michael-Sandel-Jan-Stroeken.pdf
Here you will find a short summary, being the last part of the review:
Public Debate and Basic Income Sandel’s analysis is razor sharp. What he brings to the fore more than anything is how present-day populism is only indirectly fuelled by the unequal distribution of income and essentially dominated by an ethical and cultural component. A growing section of the population feels underrated. This has everything to do with the tyranny of merit driven by the meritocratic ethos that, over the past decades, has led to meritocratic hubris. This hubris is reflected in the winners’ tendency to let their success go to their heads, forgetting about all the luck and good fortune that helped them along the way. Those who make it to the top believe with self-satisfied conviction that they deserve their fate and that those who end up at the bottom do too. This leaves little room for the kind of solidarity that could arise if we were to realise just how haphazardly talent is distributed and how randomly fate can either be kind or cruel. Merit-based pay is, according to Sandel, thus a form of tyranny – an oppressive regime.
And so, Sandel launches into a plea for a sweeping public debate on how to move from today’s individualisation to a greater sense of solidarity and more self-determination for all. What is essential in this respect is his conclusion that for many to be successful in life, all forms of education and work would have to be taken equally seriously. Without explicitly mentioning it, he points to the core of what the implementation of a universal basic income is all about: more equal recognition of current paid and unpaid work, as well as a stimulus to go to school. In an interview with Dutch newspaper De Volkskrant (20 September 2020), Sandel describes this when he speaks about ‘that which contributes to the community’ as a key alternative criterion to purely performance/merit-based recognition:
‘It is, in any case, a more democratic method that allows us to recognise contributions that are currently ignored or undervalued. I mean contributions such as the unpaid work that is done within households, for example, such as raising children and caring for relatives. Or all the work that, due to the COVID-19 crisis, has turned out to be much more important than society gave it credit for: nursing care, cleaning work, waste collection, and logistics. Setting aside the matter of usefulness, the fact that there is equal dignity in every human being should also reverberate in the dignity of everyone’s work.’
Regrettably, Sandel hardly gets around to formulating specific solutions in his book. Nevertheless, his most concrete suggestion with respect to the revaluation of work is to improve wages at the bottom of the labour market, such as through wage supplementation schemes and by shifting the tax burden away from labour and onto consumption, speculation, and capital. While the latter suggestion is an excellent one, it would be even better if it were substantiated further to ensure that those who do unpaid work also benefit.
This further substantiation also takes us to a second key argument for downgrading the role of merit-based pay, which is that the link between current wages on the one hand and individual work performance on the other is loosening. Pay is increasingly less personal. Our current level of prosperity, as initially reflected in people’s primary income, is the result of many years of productivity growth to which many generations have contributed. Our high income levels can, therefore, not be put down only to the labour performed and capital invested in companies at this point in time. In this context, distributing primary income only to those directly involved in the production process seems to be increasingly less of a given and implementing a universal basic income for all is an obvious alternative, i.e. regardless of someone’s position in the productivity-driven labour process. The state collecting taxes directly at the source, i.e. at the level of companies’ production, would then be the obvious choice. This would also automatically shift the tax burden to sources other than labour, which is merely one production factor.
The figures provided in the book demonstrate that there is growing support among the general public for the idea of universal basic income. Even so, there is a hard core of people who are against it and keep using counter-arguments that they cannot back up with facts, such as a universal basic income having adverse effects on the labour market and being too costly. Their rejection might very well have little to do with those counter-arguments and rather be driven by a strong meritocratic bias. There is a clear relation between implementation of universal basic income and the public debate that Sandel wants to initiate.
Finally, the results of the most recent parliamentary elections in the Netherlands can be explained based on Sandel’s The Tyranny of Merit. On the one hand, right-wing populist parties are on the rise. One in five Dutch people voted for populist right-wing parties that have become increasingly extreme since the days of Pim Fortuyn’s first populist revolt in the early 2000s: full of mistrust and bitterness directed at everything and everyone and not shy about avowing discrimination. Even in the knowledge that these parties will not be part of a coalition government and play no role in the actual governance of the country, people still vote for them. And people vote for these parties even though their election programmes are, at least in a socioeconomic sense, more likely to be prejudiced than to favour them. On the other hand, the two winners of the elections are supreme exponents of meritocracy, namely the People’s Party for Freedom and Democracy (VVD, the party for the successful) and Democrats 66 (D66, the party for the highly educated). What we need to do over the coming years, therefore, is to assemble a left-wing populist programme that addresses three pressing issues:
How to achieve a sustainable world as soon as possible;
How to reach a post-capitalist state by shifting the balance of power;
How to accomplish lasting labour market change in line with the foregoing through a national debate as proposed by Sandel.
Some possible solutions include a large-scale shift from taxation of labour to direct taxation of companies’ production as well as implementation of universal basic income.
‘The Tyranny of Merit: What’s Become of the Common Good?‘ is available from Penguin Random House, published September 2020
In Canada, basic income has become a central issue in the debate on a post-pandemic recovery. Recent steps taken by the governing Liberal Party to endorse the policy has begged the question whether this might represent a serious step towards a permanent national basic income.
In their annual convention in mid-April, Liberal Party grassroots, MPs and delegates voted overwhelmingly in favour of making universal basic income a top policy priority for the party going forward. The policy earned a second place out of 26 policy resolutions to come out of the convention. Although the vote is not binding and does not guarantee that the party will go further with the policy resolution, and further, does not detail what such as Canadian basic income might look like, the move adds to growing momentum surrounding basic income in the national debate.
While the idea has garnered significant national attention previously in Canada, particularly surrounding the recent pilot project in the province of Ontario that was prematurely cancelled, the pandemic has accelerated that debate. At the onset of the country’s first national lock-down in March of last year, there was a significant push for the government to implement an emergency basic income by various advocacy groups such as Basic Income Canada Network, its provincial affiliates as well as by individual long-time basic income proponents. It also garnered significant media attention, with the debate often being centered on the ways in which the current income support system in Canada was inadequate to address the situation.
Many argued that the current employment insurance scheme and the social assistance system were out-dated models not equipped to deal with a changed, and changing, workforce. The New Democratic Party to the left of the Liberal party, which has not traditionally supported basic income but rather a strengthening of the employment insurance system, came out in favor of a universal guaranteed income as a pandemic measure and joined the push for the government to adopt such a policy.
At the time, however, Liberal Prime Minister Justin Trudeau rejected the idea of implementing a universal basic income and opted instead for a more targeted approach. This gave rise to the Canada Emergency Response Benefit (CERB), which was meant for those who did not qualify for existing support programs. The benefit provided individuals who had lost all or part of their income due to the Pandemic with a direct deposit of $2000CAD per month for up to six months. Among the five eligibility criteria for the program, an individual had to have earned minimum $5000CAD in employment income in the previous year, and, as such, it still to some degree tied eligibility to formal employment status.
There was both approval and criticism of the program from all sides of the political spectrum. The Conservative Party argued that the policy was too costly, enabled people to cheat and would prove a disincentive for people to look for and find new work, while the New Democratic Party criticised the policy for being too heavily conditional, not sufficient and not accessible to all who need it.
The program was nonetheless seen by some as a precursor to a potential basic income and as an unintended national experiment with basic income. Amid positive stories published in media on how the CERB had helped people get by, there were further calls to turn the program into a basic income – something that was again, however, rejected by the Prime Minister. Nevertheless, acknowledging that taking away this income support from people in the midst of an ongoing pandemic and new impending lock-downs, the program was replaced by a similar one called the Canada Recovery Benefit, set to end in September 2021.
Now, with the prospect of the pandemic coming to an end, the focus is on basic income as a part of the post-pandemic recovery. Further advocacy groups such as LeadNow and UBI Works have campaigned for the governing party to endorse the policy, and in February a Liberal member of parliament introduced a bill calling for national guaranteed basic income. A vote to determine whether the bill will be brought to committee is expected in coming weeks. If indeed based on the CERB, a hypothetical permanent Canadian basic income would likely not include the pandemic-specific work requirements, but further details as to what such a policy would look like are not provided in the motion.
Additionally, a week before the Liberal convention, the parliamentary budget office issued a report on the cost and the impact on poverty of a national guaranteed basic income, which has significant differences to the “basic income” as defined by BiEN. The report estimates the costs of a model akin to the one that was tested in the pilot project in Ontario to be $87.6 billion in 2022-23. This amount does not take into consideration the potential cost savings of repealing social assistance programs it might replace, as well as the potential savings in terms of health care costs, reduction in crime and less pressure on other social support systems that such a policy might have – something which Evelyn Forget’s groundbreaking work on the Mincome Project in the 1970s in Manitoba shows to be the case. The report concludes that this kind of basic income model could reduce poverty rates by 49% and further estimates that the effect on labour supply is a 1.3 percentage drop in hours worked per week on a national average. Both the cost of a national basic income and the effects on behaviour relating to work have been central concerns in the debate.
There was much anticipation leading up to the convention, and the vote to endorse basic income as a top policy priority signals a shift in the party’s stance on the policy, even though it is not binding. And while basic income was not a part of the Liberal’s federal budget for 2021-22, which was unveiled following the convention, the endorsement comes in an election year, which could make it a key election issue.
In February 2019, then-Stockton Mayor Michael D. Tubbs launched the Stockton Economic Empowerment Demonstration (‘SEED’), a 24-month guaranteed income initiative, the first mayor-led initiative of the sort in the US. Two years later, the preliminary results from the first twelve months of the experiment (through to February 2020, before the pandemic) have been released and the key findings are positive with the guaranteed income reducing income volatility, enabling access to full-time work, improving mental health and allowing better control over one’s time and decisions.
Program design
Under the SEED program, 125 Stockton residents were randomly selected to receive $500 per month for two years with no conditions attached to the handout and limited eligibility criteria namely: being at least 18 years old, being a Stockton resident and living in a neighbourhood at or below the median income ($46,003 in Stockton). A control group of 200 individuals meeting those same criteria was also established for research purposes.
The experiment is funded with private donations including a $1 million grant from the Economic Security Project, an initiative that aims at “making the economy work again for all Americans” with a specific focus on guaranteed income and anti-monopoly action.
The program is being evaluated by two researchers, Dr. Stacia Martin-West of the University of Tennessee, and Dr. Amy Castro Baker of the University of Pennsylvania under a ‘mixed-methods approach’ consisting in both a quantitative and qualitative analysis of data collected before and during the experiment. The data was collected through both surveys and in-person or group interviews (participation in the experiment was not conditional on participating in these interviews).
The experiment was designed in close cooperation with public authorities and community members to tailor it to local specificities (disbursement timing and mechanism for instance) and to build trust between recipients, control group members and SEED staff. This work was necessary to address initial concerns around the unconditional and guaranteed nature of the income (considered ‘too good to be true’) and the risk of loss of eligibility for other benefits (covered through specific work by the Economic Security Project).
Key findings
The preliminary results show that recipients made rational decisions about the income they were receiving, mostly spending it on ‘necessities’ (food, utilities, auto care). The researchers also found positive spillover effects with recipients being able to assist people in their extended networks more. Recipients also faced less income volatility and, noticeably, reported being more able to face unexpected expenses with cash or a cash-equivalent than before.
The guaranteed income gave recipients more time to engage in meaningful activities (socialising, spending time with children). This, according to the researchers, highlights how “financial scarcity generates time scarcity”. Participants also reported improvements in mental health when members of the control group did not experience the same improvements. Participants also reported improvements in mental health compared to the baseline measures when members of the control group did not experience the same improvements.
Finally, the program also resulted in an increase in full-time employment. 28% of recipients had a full-time job at the beginning of the project. After a year that proportion had risen to 40% (in the control group the proportion only moved from 32% to 37%). Some individuals indicated that the guaranteed income allowed them time to train or complete a degree or simply gave them more confidence to apply for certain positions.
Reactions
Reactions to the release of the study have been positive with the findings seen as further evidence that these programs do not remove incentives to work and that, as the researchers put it, “poverty results from a lack of cash, not of character” making cash transfers an effective way of addressing poverty (the researchers as well as Mayor Tubbs are quick to point out however that these cash transfers cannot be the only solution to the issues faced by residents of a city such as Stockton).
On the other hand some have pointed out that SEED remains a small-scale and relatively short experiment and have cautioned about drawing conclusions too rapidly from the study. Another limitation of the study is that tracking of expenses from the guaranteed income relied on recipients collaborating with the researchers (the income was transferred to a prepaid debit card to be used directly and through which researchers had access to spending records, or to be withdrawn as cash or to another account. In those cases, about 40% of the recipients, researchers had to conduct specific surveys). Finally, some critics have used the fact that the experiment was being privately funded to argue that basic income was too expensive for public authorities.
Regardless, these results are sure to add to the growing debate about basic income in the US. Other experiments are ongoing, and in June 2020, Michael Tubbs and the Economic Security Project founded Mayors for a Guaranteed Income, a network of around 40 mayors across the US working on implementing guaranteed-income experiments in their cities.
