by Karl Widerquist | Mar 28, 2018 | Opinion, The Indepentarian
This essay was originally published in the USBIG NewsFlash in September 2009.
Many people believe that the Alaska Permanent Fund Dividend is an idea ready to export—a model that should be copied around the world. Two U.S. Senators have gotten the idea that the Alaska model is ready to be copied, not by the country over which the U.S. Senate has jurisdiction but by Iraq instead.
Last January, John Ensign (Republican-Nevada) introduced the “Support for Iraq Oil Trust Act” of 2009. According to the official summary of the bill, it would force the U.S. State Department to present a plan for an oil trust fund (based on the Alaska model) to the Iraqi government, and it threatens to reduce U.S. aid to Iraq if the U.S. Secretary of State fails to do so.
The bill picked up one cosponsor, Senator Evan Bayh (Democrat-Indiana). No further action has been taken on the bill since it was referred to committee in January, and probably the bill will die in committee.
But the bill has received negative attention from press in the Persian Gulf region. Saadallah Fathi, writing for GulfNews.com (based in Dubai) sees the bill as an effort to pressure the Iraqi government to adopt a policy that is not well-suited for Iraq’s situation.
Whatever the value the Alaska model might have for Iraq, this bill is probably the wrong way to export the idea. The U.S. government could make a greater effort to lead by example. If the Alaska Permanent Fund is a model to be copied, the Senate might consider copying the model itself by creating a Federal U.S. Permanent Fund. Copying the model yourself seems much more reasonable than trying to influence someone else (a sovereign foreign government) to copy the model.
The United States is resource-rich. It has the potential to create a very large Alaska-style fund using taxes on resource exploitation, such as mining, drilling, forestry, carbon emissions, and real estate. If the senators are right that the Alaska-model is ready to be copied, they might consider implementing it first in their own jurisdiction.
-Karl Widerquist, Doha, Qatar, August 2009
For Saadallah Fathi’s article in the Gulf News, go to:
https://www.gulfnews.com/business/Comment_and_Analysis/10322760.html
by Andre Coelho | Feb 22, 2018 | News
Steven Shafarman has just published a new book titled “Basic Income Imperative”. The sub-title points to some of the expected results of basic income implementation, according to him: peace, justice, liberty and personal dignity. Shafarman, author of three other books (Awareness Heals, Healing Politics and We The People), defends the basic income concept in this new book, in an approach centered on the individual. “What do you want for your kids and grandkids?”, “What will you do with a basic income?”, Can you see how this might lead to rapid progress on the issues you care about, like hunger, homelessness, health care, education, democracy, social justice, climate change or peace?” are some questions the book poses, and hints at possible answers, looking further into the future.
In Basic Income Imperative, after a presentation of the basic income concept, precedents are also described, such as the Alaska Permanent Fund Dividend. It goes on with explaining how it could be implemented, and what it could represent as a changing factor to political landscapes. According to Shafarman, a life member of the Basic Income Earth Network (BIEN), basic income may be a key policy to achieve “meaningful progress on health care, tax reform, global warming, immigration, national security, and other issues”.
More information at:
Steven Shafarman, “Basic Income Imperative: for peace, justice, liberty and personal dignity” (on Amazon)
Basic Income Imperative book website
by Karl Widerquist | Jan 17, 2018 | Opinion, The Indepentarian
This essay was originally published in the USBIG NewsFlash in April 2007.
Republican Presidential Candidate Tommy Thompson has endorsed BIG—at least in a foreign country. On his campaign website, the former Wisconsin Governor calls himself “the reliable conservative in the 2008 presidential race.” The first reason he gives is, “Tommy Thompson is the father of welfare reform.” Thompson has a good claim to that title. Since 1996, welfare reform, also known as “workfare,” replaced conditional cash support for single mothers with work requirements, sometimes for less than minimum wage, without providing daycare. The plan was modeled on an earlier Wisconsin program initiated by then-governor Thompson. Workfare is usually motivated by the belief that poor people have a responsibility to take whatever jobs are offered, even if they have substantial childcare responsibilities.
Thompson is literally the last America one might expect to endorse BIG—a plan to provide unconditional cash benefits to every citizen. But Thompson has not only endorsed BIG, he has made it a major initiative in his campaign. He has discussed it in numerous interviews and speeches and at the Republican presidential debates. He hasn’t endorsed BIG for the United States but as part of his strategy to win the war in Iraq. The BIG element in Thompson’s Iraq strategy is that one-third of Iraqi government oil revenues will be reserved for a fund to provide every Iraqi with a small income guarantee modeled after the Alaska Permanent Fund (APF). USBIG Newsletter readers will recall that the APF was the initiative of another Republican Governor, Jay Hammond. It provides a small but significant income guarantee to every Alaskan resident.
Of course, both the APF and any likely Iraq proposal fall short of the goals of most BIG supporters because they are not large enough to cover the recipient’s needs—a “partial BIG” rather than a “full BIG.” But Alaska experience has show that even a partial BIG can make a great difference to the needy and sets the right precedent.
Thompson’s plan is rather far from implementation, however. To introduce it, the U.S. would have to be continuing its involvement in Iraq two years from now, when a president Thompson would take office. At that point the U.S. will have been at war for nearly six years. Even then, Thompson could only recommend the plan to the Iraqi Parliament, which is formally recognized by the U.S. government as the sovereign government of an independent country. If the whole of Thompson’s plan is adopted, United States would likely remain at war in Iraq for four more years while we find out whether the military elements of his plan work.
Thompson has not discussed extending the Alaska-style plan closer to home, nor does he seem aware of the possible conflict between the goals of an APF-style BIG and his pedigree, Workfare.
What’s the big deal if a politician in one country supports BIG in another country where he may have little influence even if elected? It show that framed in the right context, BIG can have a great appeal even to work-ethic conservatives, and it demonstrates the growing appeal of the APF precedent. The APF is so obviously successful, so popular, and so cost-effective that it appeals even to the father of workfare. Much of the motivation for workfare has been popular American resentment against people who receive direct government payments. But there is little resentment in America for people who receive property income whether or not they work and whether or not they received their property through work. The APF makes some part of Alaska’s oil revenues into part of the personal property of every Alaskan. It’s theirs; they own it. It is quite natural to infer that if it is right for every Alaskan to own a share of their oil, then perhaps every Iraqi should own a share of their oil too. But once you have endorsed that principle it is quite natural to infer that every South African should own a share of their gold. Every Botswanan should own a share of their diamonds. Every Welshman should own a share of their coal. Every Bolivian should own a share of their tin. And the full inference is that everyone should own a share of all natural resources. If we put that principle into practice, single mothers would not need workfare at all.
-Karl Widerquist (Michael Lewis contributing), New Orleans, LA, April 2007
by Karl Widerquist | Dec 20, 2017 | Opinion, The Indepentarian
This essay was originally published in the USBIG NewsFlash in December 2005.
On November 6, at a conference on greater economic integration in the Americas in Brasilia, just after his 22 minutes conference in Brasilia, President Bush extended his hands Senator Suplicy, who asked:
Senator SUPLICY: “With respect to the integration of the Americas we should have the purpose of not only to have the free movement of capital, goods, and services, without any barriers but also and mainly of what is most important, that is, of human beings from Alaska to the Patagonia. More than that we should also have what you already have in Alaska with much success, a citizen’s basic income to all residents in that State.”
President Bush: “Well, in Alaska they have lots of oil.”
SUPLICY: “But we may have a basic income from all the forms of wealth that are created. I would like to suggest that in order to create the conditions for real peace based on justice in Iraq that we should stimulate the Iraqis to follow the example of Alaska that pays every year a basic income to all residents living in that State in the form of dividends that result from the Alaska Permanent Fund.”
BUSH: “We are working on that! We are working on that! Thank you.”
Suplicy also spoke about Brazil’s basic income at the Parliamentary Network Conference of the World Bank in Helsinki, Finland on October 21-23. About 180 members of the parliaments of about 100 countries of the world participated in the Conference. Senator Suplicy individually lobbied several members of parliaments on Basic Income. Suplicy presented the same lecture at the Austrian and Belgium Basic Income Network, in Vienna, October 9, and to the Training Department of the European Commission, on October 10.
by Citizens' Income Trust | Dec 18, 2017 | Opinion
This article is based on a research project conducted by a French student, Lucas Delattre, during the summer of 2016, and updated in October 2017
Introduction
A Citizen’s Basic Income is an unconditional, nonwithdrawable income paid to every individual as a right of citizenship.
In 2016, at a discussion on Nick Srnicek and Alex Williams’ book Inventing the Future: Postcapitalism and a world without work (Verso, 2015) at the New Economics Foundation, Ed Miliband was asked what needed to happen to move us towards the implementation of a Citizen’s Basic Income scheme. ‘A pilot project’ was the answer. Others have made the same suggestion.
Existing pilot projects
Many of the projects that have been claimed as Citizen’s Basic Income pilots do not satisfy the criteria of being universal, unconditional and based on the individual. Those that do pay unconditional incomes to individuals cannot be absolutely universal, since they necessarily exclude those outside the sample. This is also an ethical issue that cannot be avoided. And the short duration of most projects enables some short-term effects to be detected, but not long-run or life-time effects. (A project in Kenya is giving 23 US$ per month to 40 villages for 12 years, which is much longer than the two years for which most experiments run.)
Some projects call for volunteers, and so are unlikely to be representative. Mandatory involvement of a representative sample is to be preferred; and even better is a saturation sample, covering a defined geographical area, which can enable effects to be picked up at a local level. Projects that compare the experience of pilot groups that receive an unconditional income to the experience of control groups that do not are preferable to experiments that do not employ control groups.
In 2008 and 2009 a privately-financed pilot project was held in the small rural settlement of Otjivero-Omitara in Namibia. 100 Namibian dollars (£7) was paid each month to every member of the population for a period of two years, and significant results were achieved in relation to health, education, crime reduction, economic activity, and poverty reduction. There was no control group with which to compare these results.
Between 2011 and 2013, similar projects in India paid 300 rupees (£3) per month to every member of several pilot villages, and in India the impressive results obtained in the pilot project villages could be compared with those in the control villages.
The Alaskan Permanent Fund (APF) is a sovereign wealth fund based on Alaska’s oil revenues, and invested in the international stock market. It gives an annual dividend payment to every Alaskan citizen, who has been resident for at least a year in Alaska. The APF has usually been able to provide a dividend of between $1,000 and $2,000 each year. Obviously, it is annual and variable, and is not sufficient to take on the role of social security: but it has had beneficial effects on the population of Alaska.
A micro-level pilot project in Germany provides Citizen’s Basic Incomes to selected individuals for one year. In Finland, a random sample of 2,000 people aged 25-58, who were unemployed at the end of 2016, are receiving €560 per month Income for two years in place of existing benefits, and the sample subjects can keep their payments after they have found employment. However, while being based on the individual and unconditional, this does not fulfil the Citizen’s Basic Income criteria of being universal. A similar approach is being considered by some Dutch municipalities. The current experiment in Ontario, Canada, is a Guaranteed Minimum Income project where a means-tested household-based benefit targeted on subjects aged 18-64 is being tested.
The Negative Income Tax experiments in the USA and Canada during the 1970s were based on the household, and so did not fulfil the criteria as a Citizen’s Basic Income pilot projects.
None of this is to suggest that the projects that have been undertaken are not of value. They are. Valuable lessons have been learnt in Namibia, India, Alaska, and the various states in Canada and the USA where Negative Income Tax experiments have taken place; and additional useful lessons will be learnt in Berlin, in the Netherlands, and in Finland. But we still await a genuine Citizen’s Basic Income pilot project. It is arguable that the Indian and Namibian experiments were as near to genuine pilot projects as possible because they were of sufficient duration to enable trends in behavioural change to be evaluated and trajectories predicted.
The UK
Might it be possible to run a Citizen’s Basic Income pilot project in the UK? A genuine Citizen’s Basic Income pilot project? Multiple problems present themselves:
- the project would have to be for a sufficiently long period for a sufficient number of assessments of behavioural change to be made to enable trajectories to be plotted and reliable estimates made of the likely behavioural changes that would accompany a permanent Citizen’s Basic Income scheme;
- any Citizen’s Basic Income viable in the short to medium term in the UK (and in any developed country) would have to be funded wholly or in part by changing income tax and social insurance contribution levels and thresholds. So a genuine pilot project would require government departments to make those adjustments just for the individuals involved in the project, and to recycle the savings into pilot project participants’ Citizen’s Basic Incomes – a somewhat unlikely proposition;
- the project would need to involve a cross-section of the population if it were to stand some chance of modelling a genuine Citizen’s Basic Income; and
- because any revenue neutral or almost revenue neutral scheme would impose losses on some households (- preferably on households in the higher income deciles), some participants in the pilot project would lose disposable income at the point of implementation.
A feasible Citizen’s Basic Income experiment
What would be feasible would be to provide a genuine Citizen’s Basic Income to a small community on top of existing benefits provisions and without altering National Insurance contributions or Income Tax payments. This would avoid government departments having to change current tax and benefits provisions: but it would require additional funding and it would not mirror the tax and benefits changes that would be required to fund a genuine Citizen’s Basic Income. This is why I have called it an ‘experiment’ rather than a ‘pilot project’. Important lessons could be learnt: but nobody would be able to regard the experiment’s results as evidence for how a Citizen’s Basic Income would work in practice.
A further feasible option would be to give a Citizen’s Basic Income to all sixteen to eighteen year olds and not give them an Income Tax Personal Allowance. This approach would create minimal problems for the tax and benefits authorities and for employers, and it would result in almost no losses at the point of implementation. The important question would be whether to promise permanence – in which case it would be a genuine pilot project; or whether to limit the experiment to a stated number of years – in which case it would be an experiment. (Microsimulation research on such a pilot project/experiment can be found in a recent working paper. )
