by Kate McFarland | Aug 19, 2017 | Research
Three members of the Foundation for European Progressive Studies (FEPS) Young Academic Network — Frederick Harry Pitts, Lorena Lombardozzi, and Neil Warner — have published a study on basic income, entitled “Beyond Basic Income: Overcoming the Crisis of Social Democracy?”
The full paper can be read and downloaded here.
Abstract
Across Europe, a crisis of social democracy prevails. Deindustrialisation precipitates a breakdown of the communities, institutions and interests that held the social democratic and labour movements together. A collapse in everyday life passes over into a steady decline in the electoral realm. Elsewhere, a crisis of social reproduction ensues. The relationship between the wage and subsistence weakens, public services face cutbacks and a generalised dispossession of people from the commons continues apace. This triple crisis- of the society of work, social reproduction and social democracy- is a triple crisis of the social. The universal basic income (UBI) is suggested by many as a means by which the social synthesis can be pieced back together.
In this paper we explore whether or not UBI lives up to the claims made for its implementation, and to what extent it addresses these three crises. We ultimately pose the question whether UBI offers a solution to the crisis of social democracy, and whether, on this basis, European social democrats should pursue the policy as a central demand of a new electoral offer. We conclude that the policy cannot be suggested as a solution to the crises of work and social reproduction, at least not without being complemented by a range of other measures. A suite of reforms could strengthen its impact and ensure it is used to nurture and preserve positive social relations that reflect social democratic ideas, rather than contrary outcomes implied in alternative visions of the UBI proposed from both right and left of the political spectrum.
About the Authors
Frederick Harry Pitts holds a PhD from the Department of Social and Policy Sciences at the University of Bath, and is currently a Lecturer in Management at the University of Bristol. His research interests lie in the sociology of work and political economics, with specializations in the creative industries and the future of work.
Lorena Lombardozzi is a graduate student at SOAS University of London, where she holds an MSc in Political Economy of Development. Her dissertation research concerns agricultural commercialization in Uzbekistan’s cotton-food system and its nutritional impacts.
Neil Warner is a postgraduate researcher in the Department of History at Trinity College Dublin, studying perspectives on unemployment and the British Labour Party in the late 20th century.
FEPS is the first progressive think tank to operate at a European level. It has previously supported discussion of universal basic income, convening a panel discussion on the topic in Brussels in February 2016 as part of its Next Social Europe lunch debate series.
The FEPS Young Academics Network, established in March 2009, currently consists of over 50 PhD candidates and recent PhD recipients from a range of disciplines.
Photo: “Unemployment Wall” CC BY-NC-ND 2.0 Luis Colás
by Claire Bott | Aug 18, 2017 | News
Richard Branson. Credit to: Wikipedia.
Multi-billionaire Richard Branson, founder of Virgin, recently became the latest wealthy entrepreneur to publicly support universal basic income (UBI), following similar public statements by Mark Zuckerberg, the co-founder of Facebook and Stewart Butterfield, the co-founder of Flickr.
Writing on his personal blog on the Virgin website, Branson said: “In the modern world, everybody should have the opportunity to work and to thrive. Most countries can afford to make sure that everybody has their basic needs covered. One idea that could help make this a reality is a universal basic income. This concept should be further explored to see how it can work practically.”
He went on to discuss the UBI experiments currently taking place in Finland, and stated that: “A key point is that the money will be paid even if the people find work. The initiative aims to reduce unemployment and poverty while cutting red tape, allowing people to pursue the dignity and purpose of work without the fear of losing their benefits by taking a low-paid job.”
Branson also indicated that he had discussed this with The Elders, a group he helped to create which aims to be the “village elders” of the new “global village”. The Elders include members such as Desmond Tutu, Nelson Mandela, Jimmy Carter, Kofi Annan and Ban Ki-Moon. He reported: “What I took away from the talks was the sense of self-esteem that universal basic income could provide to people.”
More information at:
Richard Branson, “Experimenting with Universal Basic Income”, Richard Branson’s blog, 14th August 2017
Edited by Genevieve Shanahan
by Furui Cheng | Aug 15, 2017 | News
The State Council of China released an Artificial Intelligence (AI) development plan on July 20, 2017, which aims to build a domestic industry worth almost $150 billion and positioning the country to become the world leader in AI by 2030.
There are three steps in the plan. By 2020, the Chinese government expects its companies and research facilities to be at the same level as those in leading countries such as the United States. After another five years it is aiming for a breakthrough in aspects of AI that will drive economic transformation. Then by 2030 China aims to become the world’s premier artificial intelligence innovation center, establishing the key fundamentals for a great economic power.
However, rapid development of AI solutions is not without its drawbacks. In June, Kai-Fu Lee, the chairman and chief executive of one of China’s leading venture capital firms Sinovation Ventures and the president of its Artificial Intelligence Institute, expressed concerns about the downsides of AI, particularly the potential for mass unemployment. He raised basic income as a feasible solution.
According to Kai-Fu, the AI products that now exist are improving faster than most people realize and promise to radically transform our world, not always for the better. They will reshape what work means and how wealth is created, leading to unprecedented economic inequalities and even altering the global balance of power.
He highlighted the challenges brought about by two specific developments: enormous wealth concentrated in relatively few hands and vast numbers of people out of work.
Part of the solution to the loss of jobs will involve educating or retraining people in tasks where AI performs poorly. These include jobs that involve cross-domain thinking such as the work of a trial lawyer, however, retraining displaced workers to perform these highly skilled tasks will not be feasible in most cases. There is more scope for people to occupy lower-paying jobs involving the nuanced human interaction that AI struggles to perform, such as social workers, bartenders and concierges. But here too there is a problem: how many bartenders does society really need?
The solution to the problem of mass unemployment, Kai-Fu suspects, will involve “service jobs of love.” These are jobs that AI cannot do, that society needs and that give people a sense of purpose. Examples include accompanying an older person to visit a doctor, mentoring at an orphanage and serving as a sponsor at Alcoholics Anonymous – or, potentially soon, Virtual Reality Anonymous for those addicted to their parallel lives in computer-generated simulations. In other words, the voluntary service jobs of today may turn into the real jobs of the future. Other voluntary jobs may be more professional and therefore higher-paying, such as compassionate medical service providers who serve as the human interface for AI programs that diagnose cancer. In all cases, people will be able to choose to work fewer hours than they do now.
In order to pay for these jobs, it will be necessary to take advantage of the enormous wealth concentrated in relatively few hands.
Kai-Fu Lee writes:
“It strikes me as unavoidable that large chunks of the money created by AI will have to be transferred to those whose jobs have been displaced. This seems feasible only through Keynesian policies of increased government spending, presumably raised through taxation on wealthy companies.
As for what form that social welfare would take, I would argue for a conditional universal basic income: welfare offered to those who have a financial need, on the condition they either show an effort to receive training or commit to a certain number of hours of “service of love” voluntarism.
To fund this, tax rates will have to be high. The government will not only have to subsidize most people’s lives and work; it will also have to revenue previously collected from employed individuals.”
More information at:
In Chinese:
Guo Fa, “State Council for a new generation of AI to inform development management“, Chinese State Council, July 8th 2017
In English:
Paul Mozur, “Beijing wants AI to be made in China by 2030”, The New York Times, July 20th 2017
Kai-Fu Lee, “The real threat of artificial intelligence”, The New York Times, June 24th 2017
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by Ashley | Aug 7, 2017 | News
Pictured: Gareth Morgan, leader of New Zealand’s The Opportunities Party; Credit to: Henry Cooke, Stuff
New Zealand’s The Opportunities Party (TOP), founded last year by businessman and economist Gareth Morgan, has launched a three-stage policy proposal to implement UBI for families with young children, the elderly and youth ages 18 to 23. This policy proposes youth receive $10,000 per year for the first 5 years in their transition to adulthood.
In mid-July, TOP proposed a UBI policy for youth aged 18 to 23 to support their transition into adulthood. Under the proposal, each youth would receive $10,000 per year, divided into weekly payments of $200, to support themselves during a critical period of self-development. TOP has endorsed a basic income for families with children under the age of 3 and seniors ages 65 and older. This income would be provided with no strings attached; for example, citizens would not be asked to take drug tests, submit salary information, or undergo any bureaucratic application process. TOP’s commitment to eliminate barriers to accessing UBI by youth is inspired by observations of the current system, as party leader Gareth Morgan argued, stating that “targeted welfare payments were needlessly complex, resulting in greater costs and many not claiming the benefits they were entitled to.”
The impetus for TOP’s proposed UBI policy for youth in particular is related to the fact that New Zealand has the highest rate of suicides among young people in the developing world. Additionally, youth ages 18 to 23 experience high unemployment rates. The party hopes a UBI will help alleviate financial stress and provide more comprehensive support to help youth achieve their dreams as they transition to adulthood. The UBI is meant to encourage youth to use this money in anyway they see fit, from entrepreneurship to pursuing higher education and nontraditional careers. As the economy is increasingly uncertain, the expectation is for the UBI to supplement benefits this age group already receives and provide financial support to those who may not qualify for these government benefits. For example, there are currently 20,000 youth in New Zealand who are not in employment, education or training and therefore are not receiving government benefits.
The cost to implement this policy is estimated to be $2.4 billion. The UBI would replace the first $10,000 of $245 million in benefits already received by each youth aged 18 to 23. Rather than cut existing programs for youth, TOP proposes funding the UBI from the National Party’s $2 billion Family Incomes Package, which focuses on helping low-income families with children and steep housing costs get ahead through four main benefits:
- “Increasing the $14,000 income tax threshold to $22,000, and the $48,000 tax threshold to $52,000
- Removing the Independent Earner Tax Credit of up to $10 a week.
- Lifting the Family Tax Credit rates for young children to those of children aged 16 to 18
- Increases Accomodation Supplement rates for a two person household to be $25 and $75 a week, while the maximum rates for larger households will increase between $40 and $80 a week”
The remaining $0.4 billion will come from the nation’s projected budget surplus of $1.6 billion in 2017-2018.
This UBI is anticipated to fill in the gaps in the existing support structure for youth, while also supplementing existing initiatives to support this population. For example, New Zealand’s Labour Party “plans to give everyone 3 years free tertiary education and NZ First wants to write off student loans.” Implementing TOP’s three-stage UBI for youth, seniors and young families in tandem with these additional initiatives has the potential to provide unprecedented support to these populations.
More information at:
Henry Cooke, “Gareth Morgan wants to pay every young person $200 a week with youth UBI,” Stuff, 18 July 2017
Isaac Davison, “The Opportunities Party extends $200 a week basic income to young adults so they can ‘pursue their dreams,’” New Zealand Herald, 18 July 2017
Andreas Illmer, “What’s behind New Zealand’s shocking youth suicide rate?,” BBC News, 15 June 2017
Labour Party, “A fresh approach to education,” August 2017
National Party,”Family Incomes Package- Budget 2017” August 2017
New Zealand First, “Policies: Education,” August 2017
The Opportunities Party, “Youth to Adult UBI,” 17 July 2017
by Michael Keith | Aug 6, 2017 | News
Several Western and European countries have been seriously considering Universal Basic Income recently. Numerous countries already have social programs that supplement individual incomes for select groups, such as unemployment compensation, food stamps, or housing income, but none have a program involving basic income for every individual.
The think tank NABNI (French acronym for “Our Algeria Built on New Ideas”) laid out the case for a national basic income, administered monthly, in the North African country Algeria. According to the Algerian daily news site, El Watan, the proposed monthly income would be 60 euros, approximately one-third of a full-time minimum wage salary in Algeria.
In making their case for a Universal Basic Income, NABNI argues that de-industrialization is not just a Western problem; it is also hitting countries like Algeria, which must adapt its economy to expand the service sector and decrease reliance on heavy industry and agriculture, as the French daily Les Echos notes.
According to NABNI, one advantage of a universal basic income would be its ability to simplify the complex existing social programs in Algeria into one program that would distribute the funds without the need for burdensome qualification processes. In doing so, it would reduce the bureaucratic resources involved in implementing the program and make more funds available for the program itself.
In an article on the NABNI proposal, World Crunch cites some logistical challenges that will require attention. For example, the article notes that “first, they have to solve the issue of low access to banking facilities: in Algeria, only half of the population has a bank account.” The authors also point out that determining the amount of the basic income will require care, as it must be enough to be effective, but not too much that it will drive inflation.
Thanks to Kate McFarland for reviewing the article.
