ALASKA, US: Survey shows support for Permanent Fund Dividend amid continued legal controversy

The Economy Security Project (ESP), a two-year fund launched in December 2016 to support investigation of basic income in the United States, has published the results of a new survey of Alaskans’ attitudes towards the state’s Permanent Fund Dividend (PFD).

 

The Permanent Fund Dividend

In 1976, the Alaska State Constitution created a permanent fund in which the state must invest at least 25% of its oil revenues, enabling wealth generated from the sale of a nonrenewable resource to continue to benefit future generations of Alaskans. The PFD, created in 1982, distributes a portion of the fund’s earnings as a dividend paid annually to all Alaskans.

Disbursed in equal amount to all adults and children who have lived in the state for more than a year (and intend to remain indefinitely), the PFD is widely regarded as one of the nearest “real world” examples of a basic income. Although its amount is variable, and too small to guarantee even a poverty-level existence, the PFD is universal, unconditional, and paid in cash at regular intervals, entailing that it does indeed satisfy BIEN’s definition of a basic income.

The PFD reached a peak amount of $2,072 per resident in 2015, but fell to $1,022 in 2016 after Governor Bill Walker used a line-item veto to cut the funds allocated to the PFD by the Alaska Legislature by more than half–a controversial decision that provoked a lawsuit from State Senator Bill Wielechowski, seeking to restore the full amount of the 2016 PFD approved by the legislature. Without Walker’s veto, the amount of 2016 PFD would have been $2,052.

At the time of this writing, Wielechowski’s lawsuit is being considered by the Supreme Court of Alaska, having been dismissed by a Superior Court judge in November of last year. The Supreme Court heard oral arguments on June 20, but its final decision is likely to take months.

Meanwhile, Governor Walker recently signed the state budget for 2017, without exercising any line item vetoes this year. According to KTOO News, the budget includes $760 million for the PFD, which will amount to about $1,100 per Alaskan.

 

Popular Opinion Survey

Earlier in the year, ESP commissioned a telephone survey 1,004 Alaskan voters, carried out by the market research firm Harstad Strategic Research. According to ESP, the new survey is the “most comprehensive review of public attitudes about the PFD since 1984.”

Respondents answered a variety of questions concerning their attitudes toward the Permanent Fund and Dividend. Asked how much of a difference the PFD has made in their lives “over the past five years or so,” 40% replied that the dividends have made a “great deal” or “quite a bit” of difference, with 28% replying that the dividends have made “only some” or “just a little” difference, and only 8% saying that the dividends have made no difference. Women were more likely than men to say that the PFD has made “great deal” or “quite a bit” of difference (47% versus 33%), and 70% of those who described their economic circumstances as “barely surviving” stated that the PFD had this degree of impact.

While 87% of respondents agreed with the statement, “How people spent their Permanent Fund checks should not determine whether or not the dividend program continues,” respondents meanwhile do not believe that Alaskans use their annual PFD checks frivolously: 85% of agreed that “Many people spend a large part of their Permanent Fund dividends on basic needs,” and 79% agreed that “The Permanent Fund dividend checks are an important source of income for people in my community.” A comparatively small number, though a sizeable minority (43%), agreed with the statement “Many people have wasted a large part of their Permanent Fund checks on such things as liquor or drugs.” Asked about their own spending behavior, 27% replied that they save all or most of the payments, while 30% say that they use the PFD to pay off credit cards or other debt.  

Respondents also view the universality of the PFD favorably: 72% support the fact that “everyone who is basically a full-time resident of Alaska” receives the PFD, and 84% agree that “As owners of the Alaska Permanent Fund, Alaska residents are entitled to an equal share of the earnings of the Fund.” Interestingly, though, only 50% favor the distribution of the PFD to “millionaires and multi-millionaires living in Alaska,” suggesting that framing effects may influence respondents’ expressed attitudes towards universality.

The survey also suggests that–in an apparently pronounced change of opinion since the 1984 survey–a majority of Alaskans would prefer the institution of a state income tax over the termination of the PFD if it became necessary for the state to adopt one of these measures to raise money for government services. The preference for keeping the PFD was strongest among those with annual household incomes under $50,000 (72%) and those who described their situation as “barely surviving” (82%). Even those respondents with household incomes over $100,000 tended to prefer preserving the PFD to avoiding income taxes (58%).

Many other related questions were also included in the survey. For more details and graphical displays, see the links in “more information” below.

 

More Information

Economic Security Project, “Alaska PFD Phone Survey: Executive Summary,” June 22, 2017. Official Executive Summary of the survey’s findings, prepared by Harstad Strategic Research.

Supplemental materials from Harstad Strategic Research:

Taylor Jo Isenberg, “What a New Survey from Alaska Can Teach Us about Public Support for Basic Income,” Medium, June 28, 2017. Blog post summarizing of survey results, with background about the PFD.


Photo CC BY-NC-ND 2.0 U.S. Pacific Command

I had something like a basic income; here are nine ways it influenced my views

I had something like a basic income; here are nine ways it influenced my views

For me, a job-unconditional basic income guarantee was simply a part of the life to which I grew accustomed as a young adult. In this piece, I describe how this experience has influenced my hopes and expectations concerning the effects of basic income as a policy.

The Author (circa early Graduate School)

Entering college as a scholarship student, I moved directly into a life in which I received a monthly living stipend that was not conditional on holding or looking for paid employment. There were, of course, some other conditions on the funding; I was, for instance, required to take classes at the university and make “sufficient academic progress” by some measure.

However, my “salary” was not contingent on anything that felt like being employed: I didn’t need to keep 9-to-5 hours, work in an office, report to a boss, or dress professionally — and, most importantly, I didn’t have to plan any aspect of my life around the question “What will people pay me to do?” I just took classes that interested me, which I invariably selected without consideration of the potential “market value” of the knowledge and training.

After about six years of such a lifestyle, I entered the “paid workforce” as a graduate teaching associate, an arrangement in which monthly pay continued to feel more-or-less disconnected from work, despite the addition of some new obligations. Now in my 30s, I’ve never worked a full-time job or signed an employment contract for more than a year — and I’ve continued, for the most part, to keep my deliberation about how to lead my life at a remove from questions of how to make money.

Certainly, there are significant differences between university scholarships and fellowships and a true basic income. Moreover, I am but one person, and individual cases are sure to vary considerably. Nonetheless, I believe that I came to adopt a lifestyle and internalize a mode of thought similar to what might be encouraged by a basic income.

This present piece is not an argument for basic income. On the contrary, it functions in part as a disclaimer on my own support for the idea. Of course I support a basic income, one might conclude; a basic income would help to sustain a lifestyle like the one to which I’ve grown accustomed, and it is difficult to give up what one has known and enjoyed. It is also an partial explanation of why I came to certain specific views and conjectures about the potential merit and effects of a basic income.

The following are nine conjectures about basic income that I developed due to my own experience:

  1. It would be easy to take a basic income for granted.
  2. A basic income might prevent the conflating of work (and worth) with paid labor.
  3. A basic income can promote lower consumption in the long-term.
  4. A basic income would facilitate living without long-range plans.
  5. A basic income could allow precarious jobs to be the most appealing jobs.
  6. A basic income could enable social isolation.
  7. A basic income would not “cure” anxiety.
  8. A basic income could enable individuals to make no useful social contributions.
  9. A mere “personal basic income” can make one feel alien.


1. It would be easy to take a basic income for granted (no pun intended).

This, I believe, is the crucial lesson, and it lays essential groundwork for all that follows.

When basic income proponents ask “What would you do if your income were taken care of?” they want the audience to fantasize about the myriad benefits a basic income could confer upon their lives (and, ideally, to imagine the ways in which they could use their good fortune proactively).

But when a guaranteed basic income is all one has ever known, it doesn’t feel liberating. It doesn’t feel special. It doesn’t spur one to better oneself. It is simply part of the ordinary state of existence, a silent component of the background conditions for everyday life.

When I headed off to college, I didn’t think, “Hey, cool! I have free tuition, a living stipend, and I’m relieved of working in a job; I think I’ll really make something of myself and contribute to the world!” No, not at all. Instead I thought, “Hey, cool; I have a living stipend! Now I’ll continue taking classes, as always, but I’ll get to live alone in my own apartment!” Arguably, the main effect of my job-unconditional income was to enable me to retain the mentality of a studious high-schooler: I ?took for granted that my basic needs would be met, that my main purpose was to study and learn, and that a job would just be a burden.

Of course, by contrasting this experience with that of those who lacked such financial good fortune, I can come to see that a basic income (or full-ride scholarship) entails freedom from much stress and overwork, and, in principle, opens the door for great accomplishments. However, I never truly felt freedom or relief, for I never knew a “before time” when I lacked my income guarantee.


2. A basic income might prevent the conflating of work (and worth) with paid labor.

I am ceaselessly baffled by the contention that people need jobs in order to feel a sense of purpose and self-worth, as well as the frequent assumption that when individuals are not at work in a job, they are idling away their time in passive leisure.

None of this is natural. Indeed, it is not what we learned as children. As children, we did not hold jobs, and yet our time was not one homogeneous block of undifferentiated recreation. We did not work for pay, and yet this did not entail that all of our activities were worthless.

Gulf Coast Regional Science Olympiad

When we were children, we had our schoolwork, which we were generally supposed to prioritize. We might also have had some organized extra-curricular activities like sports, band, debate, drama, or Science Olympiad, or various clubs in our schools, churches, and communities. These organized activities were also generally encouraged by our elders, as long as we did not pursue them to the detriment of schoolwork. Finally, we had “free-time”–and, even then, certain recreational pursuits (e.g. reading novels) were told to us to be more worthwhile than others (e.g. playing the Nintendo).

We were paid for none of this, of course, ?and yet we did not conclude that our activities were thereby equally valuable (or, perhaps better put, equally valueless).

Moreover, when we did grow old enough to take jobs, unpaid schoolwork (mark that: “school-work) was usually still considered more important than paid job-work. We were subject to censure by teachers and parents if our paid work compromised our performance in our unpaid work.

At some point, apparently, many unlearn these truths that still seem obvious to me–that paid work and passive leisure are not exhaustive categories, that unpaid activities can be valuable, that unpaid activities can be work, and identify and self-worth can be found outside of the labor force–though, to be sure, I don’t know precisely when, why, and how this unlearning occurs. If the necessity of finding paid work is a contributing influence, however, then it might be said that a job-independent guaranteed income helped to prevent my unlearning of these truths.

As I said above, I was able to continue to live with (roughly) the mentality of a high-schooler, taking for granted that my basic needs would be met, that a job would just be a burden, and that my main purpose was to study. That said, there were occasions when I’d find myself with extra time, feel uninspired to make any productive use of it, and think to myself, “Well, I might as well take up a part-time job…” In these times, however, paid employment always felt like a path of last resort, a last-ditch effort to mask a transient but troublesome feeling of unproductivity or worthlessness. I could (and did) justify job-hunting by telling myself, for example, “I will earn money to save so that I can ‘buy more freedom’ for myself in the future, once my inspiration has returned.” Nonetheless, I would continue to feel somewhat ashamed of my failure to find my own intellectual or creative activities to which to devote my time; a job always seemed like something of a cop-out.


3. A basic income might promote lower consumption in the long-term.

My personal experience is the main reason that I have become interested in the supposition that a basic income could encourage degrowth. Because I entered adulthood with something like a basic income, I grew accustomed both to minimal consumer spending (since my stipends afforded only a basic “no frills” lifestyle) and to substantial freedom and flexibility in structuring my time.

Yes, the thought more money and greater purchasing power was (and is) often alluring; however, I never found it sufficiently attractive to tempt me to pursue a lucrative career. Instead, since I have always had the option of greater freedom, I have almost invariably chosen it–even though this has required me to content myself with significantly less consumption than a well-paying job (or even a modestly paying one) would have allowed. And this, importantly, has never felt like a sacrifice. I truly believe there is no salary high enough to motivate me to work a 40-hour job for the next 30 years–as long, that is, as it remains possible for me to afford my basic needs while spending little or no time in standard structures of employment. Having grown to know and cherish it, I feel my freedom has no price.

Tiny Home, CC BY-NC 2.0 Todd Lappin

It is significant here, though, that this “basic income lifestyle” is simply the life to which I adapted; it is, in essence, all I’ve known. I doubt that many individuals who earn, say, $40k per year in full-time jobs (an amount well beyond my highest annual earnings, yet slightly below the US median individual income) — let alone those with higher earnings — would want to leave their jobs to live on the much more modest amount of an unconditional basic income. For many, working a full-time job has become a natural part of life, and so has the lifestyle that their salary can afford.

It is difficult to give up the pleasant aspects of a lifestyle to which one has grown acquainted — whether this is freedom and flexibility, as in my case, or more lavish consumption, as in the case (presumably) of many individuals with full-time jobs in successful careers. Meanwhile, it is fairly easy to persist in something that has come to feel like second nature, even if mildly unpleasant, whether frugality in consumer spending (as in my case) or the confines of standard employment (as for many others).

A lifelong basic income has the potential to transform that to which individuals become habituated. It is on this basis that I conjecture that a basic income has the potential promote lower levels of consumption and economic growth.

This is also, incidentally, one reason for which I am skeptical about the ability of basic income pilots to reveal anything interesting regarding the long-term effects of an income guarantee on labor and consumption. If a person begins to receive a basic income after having already grown habituated to full-time employment and the lifestyle of earning-to-consume, then it might be highly unlikely that she would choose to leave the paid workforce and subsist on her comparatively meager basic income payments. But the situation could be much different in a society in which youth begin to receive a basic income before they have experience as either full-time laborers or high-volume consumers.


4. A basic income would facilitate living without long-range plans.

“Stop No Path This Way” CC BY-SA 2.0 Mark Longair

It is sometimes argued that a basic income would better enable individuals to plan for the long term, given its ability to mitigate the scarcity mindset and survivalist thinking engendered by poverty or economic insecurity (see, e.g., Louise Haagh’s article “Basic Income’s Radical Role” in Social Europe).

It has been my experience, however, that work-independent financial security can also produce the opposite effect: if one is guaranteed long-term economic security, then one is thereby relieved of the need to plan job and career goals oriented towards minimizing the chances of future economic hardship. Indeed, if one knows that one has long-term financial security, then one needn’t plan for the future at all, economically speaking, as long as one is able to live within one’s “basic” means. In other words, a stable and reliable work-unconditional income can permit individuals who might otherwise plan and act upon long-term career goals to think only in shorter terms, pursuing present interests with little or no concern for how these present tasks might promote employment or career advancement in the future. This is, at least, how I have always lived, continue to live, and desire to live.

The idea that basic income can enable risk-tasking is nothing new or unfamiliar. Notably, Facebook CEO Mark Zuckerberg recently recommended consideration of the policy for precisely this purpose. Most commonly, however, this idea is raises in arguing that basic income can promote entrepreneurial activities, in which the risk is assumed for the sake of pursuing a specific long-range project or goal. But deliberately and intentionally living without a plan — choosing to remain open and adaptable to unplanned opportunities and the ever-changing natural flow of life — is itself a type of “risky” lifestyle.

Those with conventional “careerist” values might read the above passage as admission that the feeling of financial security provided by a basic income can be mentally and morally degrading. It seems that many consider it a mark of good character to plan for the future and devote oneself to long-term career ambitions–and a character flaw not to do so.

I can only ask, then, that we critically reexamine the moral importance we place on career-oriented thinking. I have personally embraced my relative economic security as way to eschew careerism — to live and work in a way that is maximally flexible and adaptive to my evolving interests, abilities, social networks, external demands, and whatever unanticipated possibilities may arise. For me, this may be the single most liberating thing about my lifestyle — as well as the key source of my excitement and fascination with life — and I am hard-pressed to see it as wrong.


5. A basic income could allow precarious jobs to be the most appealing jobs.

As I mentioned near the outset of this piece, I have never worked a full-time job or signed an employment contract longer than a year. And this is no dismal fate but, rather, my ingrained preference and my incredible luck. It is one of my greatest hopes to maintain this lifestyle for as long as possible, primarily due to the flexibility that it allows, and its ability to sustain the “anti-careerism” described in the above section.

Having grown used to a stable but basic income, I have acquired a taste for jobs that can be picked up when in want of extra spending money and abandoned as quickly as possible after the desired sum of money has been obtained. I often found it desirable to earn a little more than my basic living stipend; at the same time, as discussed above, I could never imagine relinquishing freedom and flexibility for a full-time and permanent job, even a well-paying one.

“Gig Economy Graphic” CC BY 2.0 Mark Warner

Traditional full-time permanent positions seldom permit employees to work just enough to gain a desired sum of income — much to the frustration of those of us who identify with Max Weber’s classic description of the pre-industrial piece-rate worker: “A man does not ‘by nature’ wish to cam more and more money, but simply to live as he is accustomed to live and to earn as much as is necessary for that purpose.”

In contrast, “gig work” makes it easier to adjust the amount of one’s work to one’s desired income level, avoiding excessively confining commitments to jobs.

Proponents often speak of basic income as an “exit option” from employment, as if an independent source of financial security is enough to allow individuals to quit their jobs. But this strictly economic picture of employment obligations seems almost to fetishize money-making and downplay social norms in a manner reflective of the very status quo values that (in my view) a basic income should help us to overcome. The economic view of “exit” neglects the ethical importance of loyalty and trustworthiness: when I sign a contract, or otherwise give my word that I will follow through on certain tasks and duties, I consider myself bound to complete the work I have promised — irrespective of whether I am paid for that work, and irrespective of whether I can make a living for myself apart from that work. If one is under a long-term contract, the option of “exit” can pose ethical and psychological conflict even if one has the financial wherewithal to leave a job (and, we might add, even if one believes that one’s personal interest would be bettered by leaving the position).

That is, I have found that job flexibility is most easily attained not only by having access to a financial safety net but also by adopting more short-term and easily abandoned forms of employment. If a basic income enables individuals more easily to exit jobs, this is not merely due to its provision of a safety net but also due to the fact that this safety net allow individuals to avoid long-term contractual agreements in the first place (though I will admit that I myself am somewhat conflicted over the ethicality of this recommendation to avoid long-term commitment to employers).


6. A basic income could enable social isolation.

“The lonely woman” CC BY-NC-ND 2.0 Johan

In the spring of 2016, I managed the Facebook page of the US Basic Income Guarantee network. I recall sharing an article entitled “Will the Universal Basic Income make us lonely? (written by Oxford fellow Max Harris) and feeling rather disillusioned by the comments, which, I felt, often failed to engage sympathetically with Harris’s concerns.

Many commenters reacted as though the very suggestion that basic income could cause loneliness was utterly ridiculous. Some pointed out that (no doubt accurately) a basic income would permit many individuals to have a enjoy richer social life that they can currently manage. None replied that a basic income could indeed facilitate a potentially harmful reduction of social activity for some people. Although just a fledgling basic income writer at the time, I was inspired to write my own reply to Harris’s article, attempting a more charitable and nuanced treatment of the loneliness worry.

There was a reason that I took the loneliness worry as seriously as I did (and do): my own job-independent income helped to enable me to lead a life of fairly extreme social isolation. There’s little doubt that any sort of on-site job would have forced me to have more social interaction than I voluntarily chose during my college years. My nearly unconditional stipends permitted me to follow my natural tendency to seclude myself and work in solitude; a job, on the other hand, would have compelled me to act against it. To be sure, being very much an introvert by nature, I didn’t want additional social interaction. I didn’t feel lonely. Indeed, I would have objected vociferously if I had been required to relinquish my substantial alone-time, especially when busy with solitary work or other activities I found enjoyable. Its naturalness, however, doesn’t imply that my high degree of social isolation was healthy, and I later came to recognize that it was not.

We should admit that, in some cases, a basic income could facilitate unhealthy behaviors that a forced regime of paid employment could counter. Social isolation is one such behavior: some of us are disinclined to engage in social interaction when it’s not forced upon us; when it becomes voluntary, we naturally tend to abstain. With a basic income, then, we must force ourselves to do what, in other circumstances, the demand to earn a living might have forced upon us. We need to take it upon ourselves to ensure that we receive a healthy dose of social interaction — and sometimes, when it’s easier and seemingly “more natural” not to do so, we won’t.

Now, this is no more a reason to oppose basic income than “Some people won’t exercise if they aren’t forced to work in the fields” would have been a reason to oppose the mechanization of agricultural. But it is a possible outcome that does merit consideration.


7. A basic income would not “cure” anxiety.

In May 2017, basic income social media witnessed a viral spread of stories claiming that Finland’s basic income experiment was already showing a reduction in stress and anxiety. Although these particular stories apparently had their source in sensationalistic reporting of a single anecdote, the supposition that a basic income would reduce stress and anxiety is nothing new — and for good reason: economic hardship and income instability are major sources of stress and anxiety for many people (as is, on the side of the spectrum, overwork).

“Anxiety” CC BY 2.0 Kevin Dooley

At the same time, however, many cases of stress and anxiety are not attributable to financial insecurity, poverty, or overwork. I know this firsthand: I have never experienced great economic difficulty, nor overwork (other than that brought on by my own perfectionism), and yet I have been affected by generalized anxiety disorder.  Anxiety is an adaptable tormentor; it can find innumerable other potential sources of anxiety — as trivial as they might seem to others — to which to affix. 

I often grimace, then, when I read particularly roseate predictions of the ability of basic income to alleviate anxiety — or, for that matter, any mental illness. Quite likely, a basic income would present significant advantages to sufferers of mental illness, especially those whose conditions prevent them from working (or from working steadily in full-time jobs), when compared to current systems of conditional welfare benefits. It would allow people security in their lives, and give them the time needed to help them grow more stable. But a basic income is no panacea.


8. A basic income could enable individuals to make no useful social contributions.

I have spent most of my adult life as a professional student, receiving stipends to study, and choosing my courses of study with no regard for either employability or ability to contribute to society. And, to show for it, I have indeed made no great social contributions.

Certainly, I’ve never been the stereotype of the lazy person content to live on her basic income payments; I’ve never been one to spend my days smoking weed and playing video games. On the contrary, I have a natural desire to feel productive, including (perhaps especially) during weekends and holidays, and it must have taken years for me years to overcome workaholic tendencies that made it difficult to enjoy leisure activities from socializing with friends to simply gazing at a beautiful sunset.

But what it is to have the natural drive to “feel productive”? Well, for one, it can be a drive to further one’s own learning and development — irrespective of whether one uses one’s skills and knowledge in any way whatsoever for the betterment of others or society. By divorcing the means to a living from the demands of the marketplace, a basic income could better enable individuals to pursue art for the sake of art, science for the sake of science, and so on. For me, this has long been integral to the appeal of the idea — even before a “basic income” of sorts came to feel like an established part of my life. It must be admitted, however, that one consequence is that artists, scientists, and other self-motivated individuals would also be free not to publish or promote their work in any way, burying any potential social contributions. (And this is not to mention that a world of self-directed artists and scientists would still have a need for those who will tend to individuals’ medical needs, repair roads and bridges, clean sewers and collect garbage, and so forth. But that is another essay, for another time.)

I believe I’ve done well for myself: my life doesn’t lack for happiness, meaning, or identity, despite (or perhaps because of) my persistent low income and lack of anything resembling a stable career. Nonetheless, there is little doubt that I could have done better for the world. I was, for one, a pretty decent STEM student; it’s possible, I suppose, that I could already have contributed to great advances in technology to improve the lives of millions. Instead, having the means, I chose to spend years engaged in pursuits such as (for example) the study of a narrow sub-sub-field in contemporary analytic philosophy of language. Moreover, because I chose such activities merely for the personal intellectual challenge, I never bothered even to try to publish or distribute my work.

All that being said, I should mention that a basic income is not unique in permitting individuals to survive without contributing to society. Perhaps most obviously, we might imagine the “idle rich” living from inheritance, trust funds, and interest earnings. Moreover, and more importantly, the fact that an activity is profitable does not imply that the activity is socially beneficial (think of those who make a living in the “manufacture of demand” — getting people to buy things they otherwise wouldn’t even want — or, say, patent sharks). This does not imply, however, that tu quoque is an adequate response to the common concern that a basic income would permit free-riding on the societal contributions of others — for, simply put, a basic income would permit free-riding on the societal contributions of others.


9. A mere “personal basic income” can make one feel alien.

I have spent much of my adult life feeling like an outsider to much of my own culture — largely due to my rejection of career culture and other attitudes that I believe to have been engendered by the “BI-like” aspects of my early adult life.

I recall that, by the time I reached 20 years of age, I was already tired of living in a world in which success was equated with personal ambition or, more specifically, personal ambition as played out in a career in paid employment. There were those who wanted to advise me on how to achieve “success” and yet insisted upon projecting their own definition of that notion onto me. It felt, in those days, like there was no one with both the knowledge to offer good guidance and the open-mindedness to hear me out on my own interpretation of “success” and the good life. I embraced anti-careerism as part of my values and identity. I saw nothing inherently wrong with myself. I saw my situation as a case of organism-environment mismatch, and I was happy with the organism, just not the environment. Sometimes, when I felt particularly at odds with the job- and career-focused culture that surrounded me (but powerless to change it), the prospect of never contributing to society actually felt good — itself an act of rebellion.

Would my young adult years have been different ?if I had been born into a society with basic income already in place? Would I have been more eager to contribute my talents in a socially productive way if I had felt a less pronounced sense of “organism-environment mismatch”? I can’t say. Perhaps, even in utopia, all youth must go through their stage of rebellion and angst.

Still, I think, there’s an important point that transcends the rebellion and restlessness of youth: having a “personal basic income” in our present culture –? obsessed as it is with jobs, careers, consumption, and economic growth — ?is likely much different from having the same in a culture in which GDP is not the measure of societal success, income is not the measure of personal success, and education is encouraged for its own sake, not merely as a means to attain a good job. And, quite likely, it would take a universal basic income, or something like it, to pave the way for these latter large-scale cultural shifts.

What a financially self-sufficient individual would do in a society of financially self-sufficient individuals is different potentially much different than what the same financially self-sufficient individual would do in a society like ours, in which nearly all other people continue to rely on full-time employment as a means to earn a living.

In May 2016, campaigners for Switzerland’s basic income referendum presented the world with the “world’s biggest question: “What would you do if your income were taken care of?” Having lived with a job-unconditional income guarantee, however, I realize that there is a much bigger question: “What would you do if everyone’s income were taken care of?”


Reviewed by Tyler Prochazka.

Cover Photo: CC BY 2.0 Generation Grundeinkommen

The Netherlands: All that’s left is the action. Where do we stand with the experiments?

The Netherlands: All that’s left is the action. Where do we stand with the experiments?

The permission to start the social assistance experiments depends on the political will of politicians at the national level. Despite obstructions, several municipalities are determined to continue with the experiments for the sake of that part of the population that is suffering under the current social welfare regime.

It’s time for new forms of social security, says Sjir Hoeijmakers in a presentation held during the annual meeting of the Dutch branch of BIEN on May 7, 2017. He begins his lecture by stressing that he prefers to speak of ‘experiments in the context of the Participation Act’, instead of ‘basic income experiments’, because they don’t fulfill BIEN’s definition of an unconditional basic income. More on the subject can be found in this thoroughly composed article. However, to smooth the conversation, he cautions that he would probably fall back in the habit of talking about ‘basic income experiments’.

According to Hoeijmakers, an econometrist who crowdfunded his own income for two years in order to support municipalities who want to study alternative forms of social assistance in scientific research projects, we need a system that is based on trust, freedom and income security. A basic income can do that. However, nobody knows the short or long term consequences of the implementation of such an income, because it has never done before. Hence, we need to do experiments, investigate as many aspects as possible and launch a broad debate.

Background

The ideas for the experiments were mainly born out of discontent with the Participation Act. Under this law, introduced in 2015, the municipal executives are obliged to stimulate welfare recipients to look for a job and to accept paid work, as well as to provide social benefit payments to its inhabitants who need such arrangements.

The implementation of this law at the local level requires a complicated set of rules, obligations and restrictions. In order to ensure a welfare recipient’s integration into the workforce and to prevent fraud, the local bureaucracy has to develop many regulations regarding, e.g., the imposition of fines and payment reductions, the appropriate use of disciplinary punishment or the application of rebates for people who live together.

A newly introduced measure is the so-called ‘compensation’ (Dutch: ‘tegenprestatie’). A welfare recipient has the obligation to do something in return for the payments. This can be voluntary work, but one can also be forced to ‘gain work experience’ in a commercial enterprise. The obligation can go as far as requiring unpaid work for six months. Some organizations who have stood up against this policy have already called it ‘forced labor’. The kind of ‘compensation’ is to be decided by the civil servant of the municipality, who is in charge of the implementation of the Participation Act. This practice is highly susceptible to arbitrariness and is therefore very unpopular among recipients.

Because of the complexity and far-reaching consequences of the law, the local government has to allocate a lot of money and manpower for control and enforcement. In the meanwhile, the social welfare system has lost its function as social safety net by the dreadful accumulation of inspection, monitoring and sanctions. Additionally, as a result of the continuing exerted pressure, beneficiaries accept less instead of more paid or voluntary work leading to alarming levels of impoverishment among this group. At the same time Dutch trend watchers predict that in ten years less than thirty percent of the population will be engaged in full-time paid work. The rest will earn money with ‘loose jobs’.

A normative framework

For these reasons, municipalities have begun to design experiments within the existing social assistance scheme. In the Netherlands income distribution and taxes (except municipal taxes) are regulated at the national level. Municipalities are not allowed to implement income policy. However, it’s the local government that is responsible for the provision of social assistance.

After a long period of lobbying by the municipalities, the Ministry of Social Affairs and Employment has finally released its general administrative regulation (Dutch: Algemene Maatregel van Bestuur / AMvB). This sets out the exact standards for the implementation of a law. The social assistance projects must be tested to the AMvB. A city council can apply for an experiment based on this document by requesting an exception to the law, for example, to temporarily suspend reintegration requirements or to allow people to earn an extra income on top of the benefit payments. The municipality is required to carry out the experiment according to the terms of the document. The framework causes many problems, because the AMvB only allows for exceptions to the law in individual cases and not when it comes to groups.

sjir-hoeijmakers

Sjir Hoeijmakers

Unfortunately, the AMvB has become the subject of political controversy, as Hoeijmakers notices. That’s why additional stipulations have been added to the experiments and compromises have to be made. For instance, the projects must be now carried out in a relatively short time, and people who make too little effort to get work can be excluded from the experiments, which makes the whole project a bit weird. As Hoeijmakers explains, all these irritating requirements make it very difficult to set up a good scientific and ambitious project. At all political levels, there are often a few people who support or sabotage the idea. Yet, city councilors and researchers are determined to overcome the obstructions and are actively seeking smart, legal solutions to bypass the Participation Act.

In the previous cabinet consisting of VVD and PvdA, it was very difficult to reach agreement over the AMvB. A majority in the Second Chamber (or House of Representatives) was in favor of the proposed experiments, but the government was not. Especially the VVD (People’s Party for Freedom and Democracy; Dutch: Volkspartij voor Vrijheid en Democratie), a conservative-liberal political party in the Netherlands, had many objections to experiments that could emancipate welfare in the long run by introducing a basic income. Members of the PvdA (Labour Party (Dutch: Partij van de Arbeid, the social-democratic party) at the local level are usually in favor of experiments in contrast to members of the cabinet. In the last months, several municipalities have stopped the preparations because of all the difficulties. In an ideal world, Hoeijmakers comments, you would expect that the national government plays a stimulating role, ensures proper tuning of the experiments and good scientific coordination. This is not the case. Municipalities also lacked financial support from the government, despite of all the rhetoric about decentralization and being open to experiments.

Hoeijmakers explains that 45 municipalities are considering experiments with social assistance policy:

  • Seven have submitted an application, among which the four forerunners Wageningen, Tilburg, Groningen who submitted their proposal in April. Utrecht wanted to start the experiment on May 1st, but the trial is postponed because the Ministry of Social Affairs and Employment (SZW) has still questions about the design. A few days after the presentation all seven municipalities received a response from the ministry with further questions and instructions about the experiments they had proposed. Tilburg’s responsible alderman (Christian Democratic Appeal / CDA) reacted furiously: “It is a bold from the blue! But we will continue with or without the blessing of the Secretary of State.”
  • Eight municipal governments are considering an application.
  • Thirty are considering alternatives. As exemplified by the experiment in Terneuzen, a small town that wanted to give a basic income of 933 euros with no strings attached to twenty benefit recipients to test how it works. However, after a news break on national television, the State Secretary for Social Affairs and Employment (PvdA) quickly torpedoed the plan. Here’s the clip (in Dutch) of the news item. There is also much hassle around an article in the AMvB indicating that the municipality is obliged to have a regulation regarding the ‘compensation’ and how it should be implemented. Multiple municipalities, for instance Amsterdam, don’t execute this directive perfectly, and that can be a reason for the Ministry to reject the application. A few days ago, the NRC, a daily paper mostly read by the establishment, came up with an article titled ‘Municipalities no longer listen to Klijnsma’ [the State Secretary of the Ministry of Social Affairs and Employment; PvdA], written in boldfaced headlines. In the article Amsterdam’s alderman for Work, Income and Participation, Arjan Vliegenthart (SP, Socialist Party) expresses his anger: “We are not going to wait for Klijnsma’s approval. We are going to start our own pilot projects.”

Hoeijmakers expects that the number of municipalities who actually will start an experiment will be around 10, although there is room for 25.

Political Outlook

Hopefully the new cabinet will become more positive about social assistance experiments. The Dutch general election of 2017 was held on Wednesday, 15 March 2017. Several small parties who were in favor of a basic income (a.o.Piratenpartij / Pirate Party, Basisinkomen Partij / Basic Income Party, Vrijzinnige Partij (VP, Liberal Party; leader: Norbert Klein) did not win a seat or lost its only seat (VP). On the other hand, GroenLinks (GreenLeft), D66 (Democrats 66), Partij voor de Dieren (PvdD / Party for the Animals) who are strongly supportive of pilot projects, all three won considerably: 10, 7 and 3 seats respectively. The PvdA lost substantially (29 seats). The new Members of the House of Representatives were installed on 23 March 2017. At least four parties are required to form a coalition with a majority (76 seats). At this moment VVD, CDA, D66 and GreenLeft have failed to build a new coalition.

According to Alexander de Roo, chairman of the Dutch branch of BIEN and co-founder of BIEN, the ratio between the left and the right in the Second Chamber is approximately 60 to 81 seats, assuming that a basic income is more popular among voters of left-wing parties than among parties at the right-wing. But this is not necessarily true. He proposes to cooperate with D66, GL and the PvdD in an effort to keep basic income on the political agenda.

Hoeijmakers emphasizes that it’s important to create a broad political support base. So, how can you introduce the basic income into the liberal tradition? Much depends on the framing of the message, stresses Hoeijmakers. He is convinced that a right-wing public is also susceptible to good arguments, at least for doing experiments, when you explain what is in it for them. For instance, what can a basic income mean for entrepreneurs, or for the complexity and bureaucracy of a government? It is very useful to show successful experiments done in other countries. The spin-off of these reports cannot be overestimated. They are very stimulating. Looking forward, it is inconceivable that we do not start experimenting with alternatives for the current social security system, we have to learn, tell stories. It will bring us to the day when people will say: Of course we want a basic income, of course we want to know the effects of its introduction! “I always advise the municipal authorities to continue with their basic income projects. Just do what you can do,” says Hoeijmakers. In conclusion, he points to Rutger Bregman, who stated in his Tedtalk (Vancouver, April 2017), “We already have the means, the research, and the need for basic income. All that’s left is the action.” According to Business Insider, “He [Bregman] got a standing ovation“ for the talk. Watch the video here.

Rules are tools. But it is impossible to rule out the human experience.”
Credit: Benno Baksteen, retired pilot of KLM (Royal Dutch Airlines)

Credit Pictures CC Fidgit the Time Bandit and Hans Lindeijer

Thanks to Ad Planken and Kate McFarland for reviewing this article

A list of controversial claims on both side of the UBI debate

In the process of cowriting a book about the upcoming Unconditional Basic Income Trials, I’ve been trying to come up with a list of the claims that tend appear in the debate. Below are two lists: first a list of supporters’ claims and then one of opponents’ claims. I gave each claim a name to make it easier to talk about them, but these names do not reflect any standard definition. I tried to order the claims in each list from the relatively more important or more common to the relatively less important or less common.

To say that a claim appears on the supporters’ or opponents’ lists is not to say that all supporters or all opponents agree on it. In fact, some of the claims contradict each other, which is to be expected, because different people support or oppose UBI for diverse reason. They might have little in common but their support or opposition to one policy proposal.

Supporters have claimed:

 

  • The freedom claim: UBI gives people greater freedom by giving them more effective power over their own lives.
  • The poverty claim: UBI (usually in combination with other policies) can eliminate poverty.
  • The anti-exploitation claim: UBI reduces exploitation in employment by giving all workers the power to refuse exploitive working conditions.
  • The welfare claim: UBI raises the welfare of net-recipients (by eliminating destitution, reducing poverty, increasing incomes of people near poverty, reducing inequality, and other effects) and many net-contributors (by removing the fear of destitution, improving their bargaining position in the market, and so on). To the welfare claim we could add many supporting claims, that UBI is good for physical and mental health, that it decreases homeless and malnutrition, that it decreases infant mortality, and so on.
  • The increased-worker-income claim: UBI increases in the income of workers directly by acting as a wage subsidy for lower-income workers and indirectly by creating market conditions likely to increase wages.
  • The better-working-conditions claim: UBI improves working conditions for many workers both by giving them the flexibility to move more attractive sectors and by creating market conditions likely to give employers incentive to improve working conditions.
  • The affordability claim: UBI at the desired level is affordable. (Most UBI proposals call for one high enough to eliminate official poverty or to raise incomes to 150% of the officially poverty level. Some call for meeting basic needs or to enable social participation and to secure a life in dignity. Some simply call for the highest sustainable UBI regardless of what that might be.)
  • The economic equality claim: UBI increases economic equality both by direct redistribution to lower income people and by creating market conditions where workers can command higher wages and better working conditions. (The taxes used to support it can also be formulated to increase equality.)
  • The social equality claim: UBI increases social equality by reducing social isolation of people with very low incomes, by reducing the stigmatization of people who benefit from redistributive programs, by reducing housing segregation, and by other means.
  • The poverty-trap claim: UBI encourages people on benefits to reenter the labor force in greater numbers than a conditional system, by ensuring they are always better off earning more private income than earning less.
  • The anti-ghettoization claim: UBI reduces (both personal and social) costs linked to high concentrations of poverty both by reducing housing segregation and by significantly raising average incomes in those communities.
  • The cost-effectiveness claim: UBI is relatively more cost-effective than traditional, conditional welfare policies (in achieving goals such as increasing equality, raising welfare levels of recipients, and so on).
  • The reduced-capture claim: UBI’s benefits are less likely to be captured by others (such as employers, landlords, and bureaucrats) than conditional welfare state policies.
  • The bureaucracy claim: UBI reduces the overhead cost associated with income support.
  • The labor-productivity claim: UBI increases labor productivity both by encouraging employers to substitute skilled for unskilled workers and by improving workers’ ability to enhance their skills and search for higher-productivity jobs.
  • The productive non-labor claim: UBI allows people to do more unpaid work (such as care work and volunteering), some of which is more productive (or socially valuable) than many forms of paid labor.
  • The politically-enabled-proletarian claim: UBI—by freeing low-wage workers from long hours and low pay—makes them a greater force for progressive social change on all other issues.
  • The acceptable-labor-supply-effect claim(s): if UBI causes a reduction in labor supply, it will be within acceptable levels, and/or if UBI causes a greater-than-desirable labor-supply reduction, it can be at least partially counteracted by other policies to increase labor supply or the demand for higher-wage employees.
  • The macro-stimulus claim: UBI, in combination with the taxes that support it, helps improve economic growth and reduce unemployment by helping to stimulate and stabilize aggregate demand.
  • The “degrowth” claim: UBI helps economies move away from overconsumption and overexploitation of resources.
  • Greater respect for people in need: UBI and other universal programs treat everyone with respect while many conditional programs treat virtually all recipients as suspected cheats, even if they fit almost anyone’s definition of the most truly needy.
  • The increased-overall-redistribution claim: UBI results in greater overall redistribution to the poor, because universal policies foster greater feelings of solidarity and support once in place

Opponents have claimed:

  • The reciprocity claim: UBI allows people to share in the benefits of social production without contributing their labor.
  • The exploitation claim: a tax-financed UBI redistributes income from workers to people who do not work, thereby exploiting workers.
  • The harm-to-workers claim: the taxes needed to support UBI financially harm workers, all things considered.
  • The unacceptable-labor-supply-effect claim(s): UBI causes an unacceptably large reduction in labor supply that is not easily counteracted by other policies.
  • The self-destruction claim: UBI increases self-destructive behavior in recipients.
  • The meaninglessness claim: UBI makes it possible for people to live lives that they will eventually find meaningless because paid labor is a central source life meaning.
  • The capture claim: many of the benefits of UBI will go to someone other than the recipients, perhaps because employers reduce wages, because landlords increase rents in low-income areas, because bureaucrats create overhead costs, etc.
  • The inflation claim: UBI causes inflation that is not easily counteracted by other policies.
  • The migration claim: UBI encourages immigration and/or migration into areas with UBI.
  • The unaffordability claim: UBI at the proposed level is prohibitively expensive.
  • The negative, relative cost-effectiveness claim: UBI is more expensive than other programs that can achieve similar goals.
  • The gender-role reinforcement claim: UBI helps maintain traditional gender roles by making it easier for women to remain out of the paid labor force while performing unpaid care work and other traditional women’s roles.
  • The macro-deterrent claim: UBI decreases economic growth by enabling reduced labor market participation and increasing costs.
  • The shut-door claim: UBI creates political pressure to restrict immigration and migration.
  • The bought-off-proletarian claim: UBI—by providing a minimal level of contentment for workers—reduces their effectiveness as a force to challenge the deeper inequalities and other social inequities in society.
  • The consumerism claim: UBI leads to even more environmental destruction because of increased consumption.
  • The decreased-overall-redistribution claim: UBI is (politically and/or economically) feasible only at such a low level and only accompanied by so many other social programs that it will leave low-income people worse off than traditional, conditional social policies.
  • The strategy-to-cut-redistribution claim: factions in government will use UBI as an excuse to cut other programs, then cut in a strategy that will lead to much less overall redistribution.

I compiled this list from general knowledge accumulated over years of reading about the UBI debate. It is bound to be incomplete. Many more claims (of various levels of relevance, certainty, and testability) are undoubtedly circulating in the academic and nonacademic literature on UBI. But I hope it captures a significant range of what is being said. This list is enough to demonstrate the difficulty of designing a trial and communicating its results in a way that successfully raises the level of debate over these claims. Some are things that can’t be tested. Some are things that can only be tested indirectly, partially, or inconclusively. Few if any of these claims can be directed tested with any accuracy in a trial.

I’m interested to know how comprehensive people think it is. Did I include all the relevant claims you can think of? Did I overblow any claims that don’t deserve to be on the list?

A stock image used to evoke thoughts of "experiments"

A stock image used to evoke a mental connect with the word “experiment”

Current Basic Income Experiments (and those so called): An Overview

Current Basic Income Experiments (and those so called): An Overview

Note: Please see this article for a more current update (Oct 15)

The (Second) Year of the Pilot

Status of Basic Income (and Related) Experiments in May 2017

Last Updated: May 15, 2017

 

BIEN cofounder Guy Standing, a basic income pilot veteran and now frequent consultant, dubbed 2016 “the year of the pilot in response to the burgeoning interest in experimentation with basic income in various countries throughout the world. In 2017, some of these pilot studies were launched, some have been delayed, and other plans have remained dormant. Some have turned out to resemble a full-fledged basic income to a lesser degree than first anticipated.

This page summarizes the current state of this year’s existing, planned, and previously announced basic income pilot experiments (as of May 2017).

 

A. UPDATES ON SEVEN STUDIES

Following are summaries of the present status (as of mid-May 2017) of seven pilot studies of basic income–or, better put, seven alleged or reported pilot studies of basic income–that have received international publicity within the past year, including projects in Finland, Kenya, the Netherlands, Ontario, Scotland, Uganda, and the United States.

First, though, an important caveat: although each project listed below has been described as a “basic income pilot” or “basic income experiment” in media reports, few manifest every characteristic of a basic income, defined by BIEN as “a periodic cash payment unconditionally delivered to all on an individual basis, without means-test or work requirement.”

Granted, any social policy experiment is by its nature limited in certain ways, making it something of a vacuous criticism to say that a basic income experiment fails to test a “genuine” basic income. While a basic income is lifelong, experiments are necessarily bounded in duration. While a basic income is universal, experiments typically require that a portion of the population not receive the benefit in order to provide a control or reference group. (Even saturation studies, in which every member of a community is eligible for the program, remain limited in that the basic income does not extend to other communities in the same general geopolitical region.)

That said, some of the most highly-publicized experiments and pilot programs diverge from a basic income in ways that are significant even after accounting for inherent constraints due to the nature of experimentation. For example, the target population might not be universal. (As described below, this is the case in the experiment currently running in Finland, as well as those planned in Ontario and several Dutch municipalities and, likely, the experiment under development by Y Combinator.) Additionally, the benefits disbursed to the treatment groups in some of the experiments–such as, most notably, those planned in Ontario and the Netherlands–diverge from some of the key attributes of a basic income, such as by being household-based or reduced with earned income. (As mentioned below, the treatment conditions in the Dutch experiments will even retain a degree of job-conditionality.)

I touch upon additional caveats at the end of this article.

1. Finland’s “Perustulokokeilu” (Basic Income Experiment)

Status: Launched on January 1, 2017.

“Rainbow over the Baltic” CC BY-NC 2.0 Mariano Mantel

The national government of Finland has enacted a two-year experiment to investigate the effects of a basic income on labor market participation, designed and directed by Kela (Finland’s Social Insurance Institution). The experimental group consists of 2,000 persons, who were randomly selected from a pool of individuals between the ages of 25 and 58 who were receiving unemployment benefits from Kela in November 2016 (about 175,000 individuals nationwide). Participation in the basic income program was mandatory for those selected.

The 2,000 participants are receiving unconditional payments of €560 (about 590 USD) per month. Unlike Finland’s current programs of unemployment assistance, the pilot program imposes no requirement that recipients demonstrate that they are seeking employment or accept jobs offered to them, and those who do obtain work will continue to receive the full €560. (Thus, while the sample is clearly not representative of all Finns, the individual cash transfers do match the definition of basic income, although not a fully livable one.)

The experiment was officially launched on January 1, 2017–with the first payouts distributed on January 9–and will continue through December 31, 2018.

The research group at Kela will compare outcomes in the experimental group to a control group, consisting of all persons in the original target population who were not selected to participate. As mentioned above, the analysis will focus on labor market participation, including differences in employment rates between the treatment and control groups. Research director Olli Kangas has stated in recent lectures that Kela will also monitor expenditure on medication, health care usage, and income variation.

To avoid observer effects, Kela is conducting no interviews or questionnaires during the course of the experiment, and will publish no results prior to its conclusion at the end of 2018 (despite recent rumors driven by exaggerated claims stemming from a single anecdote voluntarily produced by one experimental participant).

Kangas has recommended expansion of the experiment in future years (e.g. to test different models and broaden the target population); at the time of this writing, however, the government has not acted upon this recommendation.

Official website: https://www.kela.fi/web/en/basic-income-experiment-2017-2018.

2. GiveDirectly’s Kenyan Basic Income Experiment

Status: Pilot launched in one village in October 2016; full experiment (200 villages) intended to launch in fall 2017.

GiveDirectly, a US-based charitable organization, has initiated a project in which it will eventually provide unconditional cash transfers to the residents of 200 villages in rural Kenya (about 26,000 people in total).

An initial pilot study commenced in one village in October 2016, in which all 95 residents now receive monthly unconditional cash payments of about 23 USD (€21) per month, amounting to roughly half of the average income in rural Kenya. Payments will continue in this village for 12 years. At the time of this writing, only this initial “test village” is receiving a basic income. GiveDirectly’s current objective is to launch its full experiment in September 2017.

Rural Kenya, CC BY-NC 2.0 ViktorDobai

In the full study, 300 villages will be randomly assigned to one of four groups: three treatment groups, in which all residents receive some form of unconditional cash transfer, and a control group of villages in which no cash transfers are given to any residents.

In the first treatment group, which will include 40 villages, residents will receive cash payments of about 23 USD every month for 12 years (as in the initial test village). In the second, containing 80 villages, residents will receive monthly cash payments of the same amount, but only for two years. In the third, also containing 80 villages, residents will receive a lump-sum payment equal in amount to the two-year basic income. (Note that, ignoring their time-boundedness, the schemes implemented in the first two treatment groups do meet BIEN’s definition of ‘basic income’.)

As GiveDirectly explains on its website, “Comparing the first and second groups of villages will shed light on how important the guarantee of future transfers is for outcomes today (e.g. taking a risk like starting a business). The comparison between the second and third groups will let us understand how breaking up a given amount of money affects its impact.”

The organization also indicates that it will investigate outcomes including “economic status (income, assets, standard of living), time use (work, education, leisure, community involvement), risk-taking (migrating, starting businesses), gender relations (especially female empowerment), [and] aspirations and outlook on life.”

GiveDirectly is making much of its data public as it collects it (e.g. responses to the first survey of participants in its initial pilot); this practice, however, pertains only to the pilot village, which is not itself to be included in the full experiment. The organization expects to publish its first experimental results after one or two years.

Official website: www.givedirectly.org/basic-income.

3. Ontario’s Guaranteed Minimum Income (“Basic Income”) Pilot

Status: Pilot studies scheduled to commence in two regions in spring 2017, and in a third region in autumn 2017.

Lindsay, Ontario, CC BY 2.0 RichardBH

The government of the Canadian province of Ontario is preparing a three-year pilot study of a guaranteed minimum income (commonly called in a ‘basic income’ in Canada), which will take place in three locations: the Hamilton, Brantford, and Brant County region (launching in late spring 2017); Thunder Bay and surrounding area (launching in late spring 2017); and the city of Lindsay (launching in autumn 2017).

A total of 4,000 potential participants will be randomly selected from a pool of low-income adults between the ages of 18 and 64 years who have lived in one of the three test locations for at least one year. Participation is voluntary, and those who do agree to participate in the experiment may exit at any time during the study.

Study participants will receive a minimum annual income of 16,989 CAD (€11,340) for single individuals and 24,027 CAD (€16,038) per year for couples. That is, individuals and couples with no external income would receive this amount of money. For participants who to earn additional income, the amount of the benefit will be reduced by the amount of 50% of earned income (entailing that, for example, single individuals will stop receiving any payment if their income rises above 48,054 CAD per year). Individuals with disabilities will receive an additional amount of up to 500 CAD (€334) per month.

The benefit is not contingent on work or looking for work. However, because the amount of the benefit depends on income and household composition, and because eligibility for the study is limited to low-income individuals, the program to be tested in Ontario is not a basic income in BIEN’s sense. (As mentioned above, the term ‘basic income’ is often used in Canada to refer to guaranteed minimum income programs, in contrast to the definition adopted by BIEN and common in Europe. The Ontario government is not being sloppy or dishonest in titling the program ‘Basic Income Pilot’; mere dialectical differences explain the ambiguity.)

According to the Government of Ontario website, the experiment will measure outcomes in a variety of areas, including food security, stress and anxiety, mental health, health and healthcare usage, housing stability, education and training, and employment and labor market participation. A third-party research group will evaluate data collected during the pilot.

Results of the pilot will be reported to the public in 2020.

Official site for more information: www.ontario.ca/page/ontario-basic-income-pilot.

4. Municipal Social Assistance Experiments in the Netherlands

Status (July 2017): Six municipalities approved to proceed with two-year experiments, which will begin in Sep-Oct 2017; applications from Utrecht and Amsterdam currently under review.

In 2016, research teams in several municipalities in the Netherlands developed plans to experiment with unconditional cash transfers to replace the nation’s workfare-oriented program of social assistance. However, their plans encountered resistance from the national government, which imposes constraints upon–and, in effect, prohibits–experimentation with unconditional benefits. (For example, the Dutch Participation Act would require that experimental participants be surveyed after six and twelve months to verify that they have made sufficient efforts to find work, and dropped from the study if they have not–effectively removing the “unconditionality” of the benefit.)

A pilot proposed in Utrecht, which had gained the lion’s share of attention in the English-language news media, has been delayed after the government failed to authorize the experiment as designed by the Utrecht University research team.  

Groningen, CC BY-NC-ND 2.0 Emmanuel Fromm

On July 3, 2017, the Dutch Ministry of Social Affairs authorized experiments in the first five municipalities: Groningen, Wageningen, Tilburg, Deventer, and Ten Boer (read more). Groningen and Ten Boer will be working in collaboration.  

A similarly structured experiment in Nijmegen, which is to involve 400 participants, was also approved later in the month.

In contrast the previously rejected design of an experiment for in Utrecht, the designs of the latter experiments were deemed to be in compliance with the requirements of the Participant Act. For example, each includes a treatment group in which participants are subject to workforce-reintegration requirements that are more intensive than current welfare programs.

In each of the experiments, which will run for two years, participants will be randomly selected from a pool of current social assistance beneficiaries (with participation voluntary for those selected), and assigned either to a control group or to one of several treatment groups.

Each experiment has at least three treatment groups, testing the following types of interventions: (1) removing reintegration requirements (e.g. job applications and training programs) on welfare benefits; (2) providing a more intensive form of reintegration service; (3) permitting participants to earn additional income on top of their welfare benefits. Subjects assigned to the third treatment groups will be permitted to retain 50% of additional earned income, up to a maximum of €199 per month, for the duration of the two-year experiment. In contrast, under current policy, welfare recipients are permitted to keep only 25% of additional income, and only for up to six months.

The Groningen / Ten Boer experiment includes a fourth treatment group, in which participants are permitted to choose to join any one of the three preceding groups.

It is not fully accurate to refer to the Dutch municipal experiments as tests of basic income. None includes an experimental condition in which the amount of the benefit is fully independent of either income or household composition (the existing benefits are household-based, which is not to be altered in any of the proposed experiments). Further, none of the proposed experiments includes a treatment that combines a reduction in the withdrawal rate of benefits with a removal of work-related conditions. And, as mentioned above, even those subjects who receive the “unconditional” payments will be subject to removal from the study after six or twelve months if they fail to seek work.

Researchers plan to examine outcomes such as employment (including part-time and temporary employment), education, and health and well being.

5. Eight’s Unconditional Cash Transfer Project in Uganda

Status: Launched on January 1, 2017.

In January 2017, Eight, a charitable organization based in Belgium, began disbursing unconditional cash payments in the Ugandan village of Busibi. All residents of the village, including 56 adults and 88 children, receive monthly cash payments, distributed via mobile phones. Each adult receives 18.25 USD (about €16.70) per month, approximately 30% of the average income of lower-income families in Uganda, and each child receives half of this amount, or 9.13 USD per month. The payments will continue through the end of 2018.

Used by permission of Steven Janssens

Eight is working with anthropologists at Belgium’s University of Ghent to examine outcomes along four main dimensions: girls’ educational achievement, access to health care, entrepreneurship and economic development, and participation in democratic institutions. Researchers will compare data collected during and after the pilot to data that were gathered before its launch. However, no additional village is being studied as a control, limiting the project’s usefulness as an experiment.

That said, Eight’s project has objectives beyond research. It is also the basis of a documentary, the first segments of which have already been release, and cofounder Steven Janssens has emphasized its larger purpose to inform future basic income projects: “From our experiences with this pilot we will learn and adjust where necessary, because in the long term we want to scale-up to more villages as our organization grows.”

Official site for more information: eight.world.

6. Y Combinator’s US-Based Unconditional Cash Transfer Study

Status: Design phase; no known launch date.

Sam Altman, CC BY 2.0 TechCrunch

In early 2016, Silicon Valley tech entrepreneur Sam Altman decided to pursue a privately-funded basic income experiment, motivated in part by the goal of moving away from a focus on employment effects and examining potential benefits of a basic income more holistically. To this end, he founded a research group at his company Y Combinator to design and implement the project.

In a February 2017 talk at Stanford, research director Elizabeth Rhodes explained that Y Combinator’s pilot is still in the design phase. As currently planned, it will use a stratified sample of 2,000 to 3,000 individuals from two states, between the ages of 21 and 35, with household incomes below the median in their area. At least 1,000 of these study participants will be randomly assigned to the treatment group, in which they will receive 1000 USD (about €915) per month for three years (with a subset receiving the payments for an additional two years). The payments will be given unconditionally and irrespective of income. The remainder of the sample will provide a control group.

The research group is also still in the process of developing metrics to evaluate the experimental results. However, Rhodes has indicated that experimenters are interested in a holistic evaluation of individual-level outcomes such as labor market participation, training and education, time spent with children, physical and psychological health and well-being, risk-taking, financial health, and help given to friends and family. Outcomes related to the children of participants (e.g. grades and test scores) might also be examined.  

Y Combinator’s “pre-pilot” in Oakland, announced in May 2016 to media acclaim, is not itself an experiment; its purpose is merely to help the research team fine-tune its methods and procedures (selection of subjects, disbursement of payments, collection and recording of data, etc.).

7. Scottish Municipal Experiments

Status: Feasibility studies in progress.

Glasgow Bridge, CC BY-NC-ND 2.0 Colin Campbell

In Glasgow, Scotland, the City Council has partnered with the think tank Royal Society of Arts (RSA) to investigate designs for a basic income pilot. The planning process, while moving forward, is at an early stage in development, with the Council and RSA currently working on a study of the financial, administrative, and constitutional feasibility of the pilot. Workshops on these topics will be held in June and July 2017, and a report is planned for September.  

The Councils of Fife and North Ayrshire have also committed to investigate the possibility of conducting basic income experiments.


B. OMISSIONS AND FURTHER CAVEATS

Avid followers of basic income news (including Basic Income News) might have noticed that some previously announced pilots and experiments have been omitted from the above list.

Oversight, of course, is a possible cause: if a current or planned basic income experiment is missing from this page, please submit it to our Submit a News Lead form.  

In some cases, though, apparently omissions may be intentional. Sometimes “basic income experiments” are announced in the media (1) prematurely, (2) when the experiment is not actually testing a basic income, or (3) when the project is not an experiment:

 

1. Not all previously announced pilot studies have come to fruition. For example, contrary to claims promulgated in news media and social media in recent months, neither the Office of Financial Empowerment of San Francisco, California nor the provincial government of Prince Edward Island, Canada is pursuing a pilot study of basic income at this time (primarily due, in both cases, to failures in attempts to secure funding for the experiments).

India has also occasionally been cited as a location about to launch a new basic income pilot study–or even about to implement a full-blown basic income policy (see the response in Basic Income News to rumors that circulated at the start of the 2017). To be sure, the national government of India has shown considerable interest in universal basic income, devoting an entire chapter to the topic in the 2017 Economic Survey, an annual document prepared by the Ministry of Finance. India is also notable in the basic income community for the success of previous basic income pilot studies. At the time of this writing, however, no firm plans for additional pilot studies (let alone a full-blown policy) have been announced, and any popular media reports of new pilot studies in India remain speculative and premature.

In general, one should be wary when the popular media announce the impending launch of a basic income experiment. Such announcements often frame the prospective studies as far more certain–and farther along in the planning process–than they actual are. Researchers and governmental officials might indicate interest in running an experiment prior to attempting to obtain funds or examining the legality or feasibility of the project, and sometimes such expressions of interest capture the ears of the media. Of course, such tentative interest does not entail that an experiment will ever actually manifest.

 

2. I have raised the second issue–the fact that many so-called “basic income pilots” or “basic income experiments” diverge substantially from tests of a genuine basic income–at the start of this article, and we have already seen examples above (including the Dutch social assistance experiments and the Ontario pilot).

Due to their relative lack of attention in popular media, I have not included reference to other social assistance experiments that have, on occasion, been inaccurately called “basic income experiments” — including those in Barcelona and the Italian town of Livorno. About the latter, a six-month social assistance experiment, BIEN-Italia’s Sandro Gobetti has clarified in Basic Income News, “Among the requirements [for participation in the experiment] was residency in the municipality for at least five years, unemployment status, registration at the employment center and a family income not exceeding €6530 gross per year. In exchange for €500 monthly, the municipality invited successful applicants to perform socially useful work.”

 

3. Finally, note that several non-profit organizations have launched projects that involve the distribution of unconditional cash transfers to individuals, but that are not experiments (although, in some cases, they might still be called “pilots”).

For example, Brazil’s ReCivitas raises money to distribute unconditional cash payments of 40 Brazilian Reais (about €12 or 10 USD) per month to residents of the village of Quatinga Velho, Brazil. In January 2016, the organization announced that the monthly payments would be lifelong, and began distributing the payments to an initial group of 14 individuals. However, the ReCivitas Institute is not gathering data to study the effects of basic income. Project leaders have stated that they are already convinced that basic income is effective, and that their goal is to provide a model and inspiration to other similar initiatives. The initiative might be considered a pilot, insofar as it is intended to provide information about how NGOs have effectively implement a basic income scheme; however, it is not an experiment.     

Lottery programs that award selected individuals their own “basic income” for some length of time, such as Germany’s Mein Grundeinkommen, are also not experiments and should not be classified as such.

Most recently, a newly launched film project in the United States, Bootstraps, has begun raising money for what it calls a “basic income pilot program”. This effort also appears not to be an experiment but, instead, a similar lottery-style program, intended to generate anecdotes, publicity, and awareness of the idea of basic income rather than robustly test its effects.


Reviewed by Tyler Prochazka. Some additional proofreading by Karl Widerquist, May 25, 2017

Cover Image: CC BY-ND 2.0 iT@c