by Toru Yamamori | Jan 24, 2018 | News
During the World Economic Forum during 23rd-26th January in Davos, Switzerland, universal basic income (UBI) will be discussed at several sessions:
11:00 GMT 23 January: How Is Rentier Capitalism Aggravating Inequality?
For the summary, speakers and live streaming, please see here.
11:30 GMT 26 January: Guaranteed Income for Growth?
For the summary, speakers and live streaming, please see here.
Guy Standing, a Research Professor in Development Studies, University of London, and an honorary co-president of the Basic Income Earth Network, who will be on the panels of the above two sessions, will also speak for UBI in the following two sessions:
13:30 GMT 23 January: Social Safety Nets for the Fourth Industrial Revolution
16:30 GMT 23 January: Bringing Dignity with Basic Income
The details of these two sessions is not yet disclosed online. UBI was also discussed the World Economic Forum held in 2017.
More information at:
Toru Yamamori, “INTERNATIONAL: Christopher Pissarides, a Nobel Laureate, argues for UBI at the World Economic Forum at Davos”, Basic Income News, 6th February 2017
by Micah Kaats | Jan 16, 2018 | News
As many as 375 million people may have to switch jobs as a result of automation by 2030. This is according to a new report published by the McKinsey Global Institute (MGI), a private sector think tank and the business and economics research arm of McKinsey & Company.
According to MGI researchers, “the transitions will be very challenging – matching or even exceeding the scale of shifts of agriculture and manufacturing we have seen in the past.” Such dramatic shifts in the global labor market will demand proportionately dramatic responses from governments, businesses, and individuals. Specifically, the MGI report emphasizes the importance of providing transition and income support to workers.
The report, entitled “Jobs Lost, Jobs Gained: Workforce Transitions in a Time of Automation”, builds on previous MGI research suggesting that 50% of global work activities could theoretically be automated by modifying existing technologies. While only 5% of jobs are at risk of disappearing entirely, 6 in 10 of jobs have 30% of constituent work activities that could be automated. According to MGI researchers, the question is not whether or not automation will alter the nature of work, but how long it will take.
Their analysis model potential net employment changes over 12 years for more than 800 occupations in 46 countries, focusing particularly on China, Germany, India, Japan, Mexico, and the USA. The report also accounts for several factors that could affect the pace of automation including technological and financial feasibility, demographic changes to labor markets, wage dynamics, regulatory responses, and social acceptance.
The report finds that 75 million to 375 million workers, or 3 – 14% of the global workforce, may be displaced by automation by 2030. These effects will be particularly felt in high income countries. In the most extreme scenario, 32% of American workers (166 million people), 33% of German workers (59 million people), and 46% of Japanese workers (37 million people) will be forced out of their jobs by 2030.
However, there may not be any shortage of new jobs available. MGI’s researchers note that new jobs will need to be created to care for aging societies, raise energy efficiency, address challenges posed by climate change, provide goods and services to the growing global middle class, and build new infrastructure.
Automation itself may also have the potential to create at least as many jobs as it destroys. Historically, transformative technological advancements have often led to significant jobs growth across industries.
The real challenge will be to ensure a smooth and stable transition between jobs. According to MGI research, automation is likely to disproportionately affect workers over 40, and sustained investments in retraining programs will be necessary to prepare midcareer workers for new employment opportunities. The report notes that this will require “an initiative on the scale of the Marshall Plan…involving collaboration between the public and private sectors.”
The MGI researchers also emphasize the need for increased financial support during transitions. Workers will need unemployment insurance to compensate for lost wages, as well as supplemental income to offset wage depressions typical in transitioning economies. A universal basic income (UBI) may be capable of satisfying both needs.
The report points to completed UBI trials in Canada and India, which showed no significant reduction in work hours and demonstrated increases in quality of life, healthcare, parental leave, entrepreneurialism, education, and female empowerment. The report also references ongoing and planned UBI experiments in the United States, Uganda, Kenya, Spain, the United Kingdom, and the Netherlands as programs to watch in the years to come.
The worldwide spread of automation may be inevitable, but according to researchers at the McKinsey Global Institute, the demise of human labor is not. Whether or not we can respond effectively to the needs of a changing economy will depend largely on our ability to ensure a secure and stable transition for displaced workers.
More information at:
James Manyika, Susan Lund, Michael Chui, Jacques Bughin, Jonathan Woetzel, Parul Batra, Ryan Ko, and Saurabh Sanghvi, “What the future of work will mean for jobs, skills, and wages”, McKinsey Global Institute, November 2017
by Guest Contributor | Jan 3, 2018 | Opinion
The crux of opposition to taxless spending (that is, money spent by a government that has not been raised through taxation) is inflation caused by creating additional money.
In The Affordability of Basic Income, a paper written by Geoff Crocker, it states that a government can create additional money without increasing inflation as long as the money supply does not exceed the productive capacity of the economy: and recent quantitative easing in both the US and Europe has given empirical backing to that claim. However, increasing the money supply beyond that point will inevitably create additional inflation.
It would be unfortunate if we never tested the boundaries of our productive capacity. Capacity utilization in the United States averaged 80.32 percent from 1967 until 2017, according to Trading Economics magazine. So far in 2017 the utilization is less than 78%. That means approximately 20% of the productive capacity in the US is an unused resource. Most nations in the world are in a similar utilization bracket, according to Trading Economics magazine.
The GDP of the US in 2016 was $18.5 trillion dollars according to Trading Economics. 20% of that is $3.7 trillion dollars. This is the amount of taxless money that could be added to the economy in the US each year, without causing inflation, in theory. Adding too much too quickly could cause inflation though, because the logistics of using 100 percent capacity takes time to implement.
The key would be to start with a small annual amount, then increase it slowly, if inflation did not occur. If the economy received a slow steady influx of taxless money from the government, the slow steady increase in demand should lead first to a slow steady use of full production, and then to a slow steady increase of production capability, as industry invests in increased production to match increased demand. This would be a platform for continued growth and utilization of taxless government spending, without causing inflation.
The government could introduce taxless spending through any number of programs, and Basic Income could be one of them. It could also lead to lower spending on federal interest payments if it were used to balance the budget, instead of increasing the national debt to do so. Many other programs could benefit as well, such as healthcare, infrastructure repair, education, etc.
Government would still collect taxes, and would still be able to use them to encourage or discourage activities as deemed necessary.
It is also a technology that would require no expensive change to the infrastructure. All major technological advancements in the past that could affect the economy by 20 percent required major investments in time, resources, and investments. The steam engine, railroads, cars, cell phones, and the Internet all took 20 to 30 years, billions of dollars, and countless man-hours to implement. Taxless government spending requires only the change of policy. No new airports, factories or cell towers, just a change in policy.
Taxless spending could provide a form of basic income funding that could be utilized in many nations around the world, without creating a burden on taxpayers, if implemented properly. It would filter into the economy and every person on the planet could benefit from it, not just the well to do. We all deserve to benefit from such a simple solution to an age-old problem, poverty.
Michael Keith has been in the construction industry for 30 years, spent 15 in the Carpenters Union building offices, skyscrapers, and condominiums. Keith had a California Contractors license, and built many custom homes there. He presently remodels Braum’s Ice Cream Store and Restaurants in 5 different states in the US.
Reviewed by Malcolm Torry and Tyler Prochazka
by Pablo Yanes | Dec 19, 2017 | News
Zone 10 – Guatemala City.
With the support of the Swedish Embassy and Oxfam in Guatemala, the Central American Institute for Fiscal Studies (ICEFI) has presented a new book entitled Universal Basic Income: More Freedom, More Equality, More Jobs, More Well-being. A Proposal for Guatemala (2019-2030), was presented in simultaneous events held in Guatemala City and Quetzaltenango. The book explains how inequality is affecting people’s lives and undermining the possibilities of strengthening democracy and development in the world, and Guatemala in particular. In light of this reality, the book proposes a universal basic income (UBI) of Q175 per month (20 €/month) accompanied by increased social spending from 2019 to 2030, which could eliminate extreme poverty and reduce inequality, while generating 4.7 million jobs and potentially boosting economic growth as much as 50%. It also gives scenarios for its financing – including a progressive tax reform – and the main challenges to its effective public administration.
When studying social inequality in Guatemala, the book mentions income inequalities, worker insecurity, the scourge of child labor and lack of employment guarantees, the still unaffordable cost of the basic food basket, the acute chronic malnutrition ravaging Guatemalan children (especially indigenous and rural children), the visible discrepancies in women’s political representation in public and private power arenas, widespread poverty and extreme poverty – also more and more wearing the face of indigenous and rural women – and the complex, institutionalized racism permeating all realms of society. All this is reinforced by the overwhelming problems of corruption and lack of transparency, by paltry public spending on the production of universal, quality goods and services, and by a tax policy that lacks legitimacy among the citizenry due to the unfair way in which taxes are collected and certain economic sectors are granted privileges.
For ICEFI, this reality requires alternative proposals to help mitigate social inequality and its more harmful effects and build economic, social and fiscal scenarios for underpinning sustainable, inclusive economic development. Together with improved public goods and services, a UBI – understood as a sum of money allocated by the State to each citizen or resident – would have a positive impact on Guatemalan society. With a monthly per-person amount of Q175, the UBI could eliminate extreme poverty and reduce inequality. The study, which should be considered a seminal work subject to discussion and more in-depth examination, also reveals that a UBI such as the one proposed could generate 4.7 million jobs in the coming years (33% of the working-age population in 2030), spread out over the entire national territory in agriculture, industry, finance, and commerce – an effect that could boost economic growth by close to 50%. Moreover, the related bankarization would promote the formalizing of businesses aimed at providing goods and services to the public. Inequality would be reduced from 0.538 to 0.472, as measured on the Gini index – better than Costa Rica (0.504 in 2014) but still far from what has been recorded for Uruguay (0.379 in 2014).
As for taxes, the proposal includes financing mechanisms (with and without tax reform). The tax reform scenario is based on a modernization of the income tax, elimination of tax privileges, and gradual reduction of income and value-added tax evasion. The book also emphasizes that implementation of a public policy such as the one proposed implies a revaluation of the State’s role as the main guarantor of individual rights and booster of development and democracy. Fiscal policy can potentially close the current gap between the economy and citizen well-being. With a modern fiscal outlook and political agreement for a profound fiscal reform, the country could have the resources for financing a UBI and other public programs aimed at enhancing social well-being, smoothing the way for compliance with the 2030 Agenda for Sustainable Development while driving productive transformation, access to credit and economic formalization.
In this book, ICEFI recognizes that a UBI would not solve all the problems the country urgently needs to face as a result of its past and present. Together with improved public services, however, it could provide a minimum though effective floor of social protection for tackling inequality and all its related phenomena. At a time when most citizens are unhappy with the current economic and political model, the study can also serve as a basis for debate on alternatives for change. Discussion of a UBI in Guatemala is expected to bring together small, medium, and large enterprises, merchants, producers and cooperatives, as well as social organizations pushing agendas for development and democracy.
The study is available in Spanish.
by Eduardo Abreu | Dec 1, 2017 | News
Charles Clark. Credit to: Michael Swan
Writing for The Catholic Register, Michael Swan reports on a talk by Charles Clark, Vatican’s top economic advisor, at an interfaith conference on universal basic income (UBI), held in St. Michael’s College in Toronto on October 20th, 2017.
This talk takes place during a period when a UBI pilot program is running in Lindsay, Thunder Bay and Hamilton, in Ontario, targeting those who qualify as low income.
Primarily, catholic social teaching focuses on human good and UBI aims to promote human well being so, although not directly a part of its teachings, UBI successfully puts in place a framework for catholic practice, said Marquette University’s Jesuit Theologian Fr. Joseph Ogbonnaya.
In Clark’s view there isn’t a Catholic economic policy, but he notes that in light of the Catholic social teaching, which advocates for equality it is sensible for any Catholic, to put forth policies that lead to less poverty and greater social mobility and inclusion, such as UBI. Still, UBI is not a panacea, meaning that we need public goods and the state for public education, public health, for welfare, he said.
Since we live in a society where we obtain what we need through markets, Clark states that we must ensure everyone has sufficient income, at a minimum level, to participate in it and have a decent living.
According to Clark, there is an increasingly unequal distribution of wealth, a result of wages that stall in the face of productivity growth. This is important since for a democracy to work there must be mobility, which in turn depends on equality being ensured, something that society needs to work on, said Clark.
Comments on UBI coming from the Catholic Church have been rare, so in this regard, public appearances as such from a Vatican related figure are refreshing.
More information at:
Michael Swan, “Basic income can’t be ignored, says Vatican expert”, The Catholic Register, 27th October 2017
