by Karl Widerquist | Jun 1, 2017 | Opinion, The Indepentarian
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 a mental connect with the word “experiment”
by Kate McFarland | Jun 1, 2017 | News
The Organisation for Economic Co-operation and Development (OECD) released a policy brief on the costs of basic income schemes, its first on the topic, in May 2017.
The report, available for download from OECD’s website (“Basic Income as a Policy Option: Can it add up?”), has been published as part of a series on the Future of Work, which was launched in January 2016 following a policy forum in which over 300 participants convened in Paris to discuss and debate the impact of digitization upon jobs and the labor market. Previous publications in the OECD’s Future of Work series have dealt with such topics as automation, technological unemployment, job insecurity, and inequality; however, “Basic Income as a Policy Option” is the first to engage directly and specifically with the idea of basic income.
The policy report considers the cost of a universal basic income paid to all individuals below their country’s normal retirement age, looking in detail at the financial implications of such a policy in Finland, France, Italy, and the United Kingdom. The benefit as conceived would be taxable and take the place of most existing cash benefits and allowances, but it would not replace public services, such as health and education, or benefits related to special needs.
Using a simulation analysis (based on the EUROMOD), the authors conclude that a basic income financed at the level of current spending would fall far below the poverty line. Correspondingly, a basic income adequate to reduce poverty would require substantial increases in taxation. Even in the latter case, moreover, the policy might not significantly reduce poverty and might leave many worse off as compared to existing programs of social welfare.
The models do not take into account any possible changes in employment rates, working hours, or earnings that might result from the instituting of a basic income, nor do they take into account any reduction in spending due to a lowering of administrative costs.
In addition to the simulation analysis of the costs of basic income, the authors discuss, in general terms, other potential risks and drawbacks of the policy, and suggest alternative forms of social assistance such as more targeted policies and a participation income.
In a recent post in his Basic Income News blog The Independentarian, BIEN Vice-Chair Karl Widerquist cites the new OECD report as an example of a mistake that he believes to be common in the calculation of the (alleged) costs of basic income schemes: confusing the gross cost with the net cost.
Read the policy brief:
OECD (May 2017) “Basic Income as a Policy Option: Can it add up?”, Policy Brief on the Future of Work, OECD Publishing, Paris.
See also:
OECD (May 2017) “Basic Income as a Policy Option: Technical Background Note Illustrating Costs and Distributional Implications for Selected Countries”, OECD Publishing, Paris.
Reviewed by Dawn Howard
Photo CC BY-NC 2.0 OECD (From OECD Forum 2016: The Digital.Economy & the Future of Work)
by Andre Coelho | May 28, 2017 | News
Vito Laterza and Jurgen de Wispelaere. Credit to: O Observador.
An event focused on the discussion about social policy in Portugal, and particularly about basic income (in Portugal mostly called unconditional basic income), took place at the Lisbon School of Law (University of Lisbon) on the past day 15th of May 2017.
The first part of the event featured Pierre Guibentif and Paulo Pedroso, both professors at ISCTE, University Institute of Lisbon. The former spoke favorably about basic income in a general sense, while the latter was clearly against it. Guibentif defended it was important to compare basic income to other forms of (conditional) income support, although he did not suggest the setup of an experimental pilot to test it. He, although highlighting basic income’s originality over other social policies, defended that it doesn’t per se defend social inclusion. He went on to say that its originality stems from an intent to generate social evolution, contrasting with minimum income schemes, that aim at alleviating most pressing inequalities but not to change the capitalist mode at its core. In his final remarks, Guibentif doubted basic income’s power to emancipate people, who may lack the capacity and/or knowledge to really pursue virtuous life paths. For that he suggested that the State should maintain and even strengthen specific programs to support citizen’s continuous learning in core areas as science, the arts and other humanities.
On the other hand, Paulo Pedroso questioned the relevance of basic income from the onset. Although he concedes that basic income is intended to be a correction of inequalities at birth (structural inequalitites), he remains skeptic about the capacity of the poorest segment of the population to structure their own lives and make a meaningful contribution to society. According to him, basic income will just keep them (the poor) marginalized and unfulfilled. Pedroso firmly stands that work is fundamental for a healthy society, and so basic income will just erase work’s importance as an identity driving force. Supporting a view of full employment, he views work as essentially related to paid employment, more commonly held as jobs. In an increasingly emotional exposition, Pedroso affirms that basic income is sure to be a vehicle for the destruction of the welfare state as we know it, in a reference to common right-wing views on the applications of basic income. He concludes stating that basic income “amounts to suicide”.
The presentation panel also included Olli Kangas, PhD and responsible for the basic income pilot project being run in Finland at the moment, while working for Kela, the social insurance institution of Finland. He essentially presented and justified the pilot project, which aims at avoiding social traps of several kinds – mainly bureaucratic, poverty and unemployment traps. He referred to some internal challenges, for instance unions in Finland, which are categorically against basic income in fear of losing affiliates in the near future. These unions congregate around 70% of the work force in Finland. Kangas explained that the value used in the experiment (560 €/month) was set in order to match the average amount recipients were already receiving from Kela. He also said that, other than employment, this first experiment would also measure the use of prescriptions, medical treatment and income registration. This would be done without interviews or questionnaires, in order not to influence the experiment’s output. To conclude, Olli Kangas announced that Kela was already planning a larger, more profound experiment in Finland. This time it would be national in range, with a larger sample taken from all people on low incomes and experimenting with more tax models.
Olli Kangas. Credit to: Observador.
Vito Laterza was also a panelist, and enthusiastically defended the basic income concept, while clearly highlighting some of its challenges. He approached the issue in a “back-to-basics” fashion, recalling the “original idea” of basic income: to liberate people. Laterza went on to describe the present-day labor market as “very segmented” and in which several lines of separation are drawn – sexual, racial, disability, etc. To counteract that unfair and segmented labor market he spoke of “cooperative security”, which intends to build on the welfare state in a non-discriminatory way. He also alerted that basic income must not be seen as “just cash”. That monetization of life tendency is, according to him, extremely dangerous, and so the implementation of basic income must be guided by a freedom-for-all mindset, without destroying the beneficial aspects of the welfare state.
To close this event’s first part, Jurgen De Wispelaere spoke about the necessity of basic income being part of a landscape of policies, most of them already in place within the context of the welfare state. According to him, a policy like basic income can be a generator of other policies, and he made a case for a possible integration between “active” and “passive” social measures. Typically, “active” policies like social investment try to prepare people for the marketplace (where commodification occurs), and “passive” ones like basic income are about de-commodification. Jurgen considers that these policies may be complementary, rather than opposites. He defends that basic income can also be an activation tool, helping in removing social traps – unemployment, bureaucratic and poverty traps – so liberating citizens to pursue education and/or other qualifications. In the same vein, basic income can also provide better conditions for young age learning, which will further the potential for a productive adulthood. He goes on to sustain that basic income also “activates” people to move from “crappy jobs” to better, more meaningful activities. As a final remark, Jurgen’s activation argument also involves gender equality issues, assuring that a basic income can particularly help women to get activated.
Roberto Merrill and Sara Bizarro, also present, shortly listed their version of the advantages and disadvantages of introducing a basic income, opening the session for questions and answers with the audience. The debate that followed revolved around the usual arguments against basic income: disincentives to work, difficulty in financing and the capture of the idea by the far-right.
The second part of the event was setup as a debate roundtable. Several personalities of the academia and politics were present, such as Carlos Farinha Rodrigues, Manuel Carvalho da Silva, Renato do Carmo, Martim Avillez Figueiredo, André Azevedo Alves, André Barata, Luís Teles Morais and the Minister of Work, Solidarity and Social Security José António Vieira da Silva.
José António Vieira da Silva. Credit to: Observador.
Apart from known defenders of basic income in Portugal, as André Barata and Renato do Carmo, all others showed reserves, in several degrees. Among these there was an overall sentiment that it may still be better to improve on existing conditional social assistance, than to risk a free-from-obligation cash transfer program and end up with a largely idle population. Basic income implementation at the European level was referred several times, in what could be a signal of reluctance in spearheading the concept, leaving that responsibility to supranational entities like the European Community. That is also the opinion of the minister Vieira da Silva, who is concerned about how to communicate the basic income concept to the population at large, and about the risk of creating a cleavage in society between those who work (have jobs) and those who do not (do not have jobs). He has also expressed his belief that there will be no shortage of work (intended as jobs) due to technological innovation, referring to past “revolutions”. However, Vieira da Silva has agreed, along with others, that a wider, more profound discussion about work is necessary in our society.
André Barata summed up the feelings in the air with the following sentence: “There were many reticent speeches, but I haven’t seen any downright opposition”.
Help provided by Eduardo Currito.
More information at:
Event information at the Lisbon School of Law website
In Portuguese:
Agência Lusa, “Vieira da Silva admite “sentimentos cruzados” sobre o Rendimento Básico Incondicional [Vieira da Silva admits “mixed feelings” about basic income]”, Diário de Notícias online, May 15th 2017
Edgar Caetano, “Um salário sem trabalhar. Faz sentido em Portugal? [An income without work. Does it make sense in Portugal?]”, Observador, May 15th 2017
by Kate McFarland | May 26, 2017 | News
Facebook founder and CEO Mark Zuckerberg made his first public comment on basic income during Harvard University’s graduation ceremony on Thursday, May 25, calling it an idea “we should explore” to “make sure everyone has a cushion to try new ideas.”
Mark Zuckerberg, a former Harvard undergraduate student who dropped out to focus on his Facebook business, returned to the university on May 25, 2017, to receive his own degree (an honorary doctorate) and to deliver the commencement address for the rest of this year’s graduating class.
A prevailing theme in his speech was “giving people freedom to pursue purpose.”
Zuckerberg’s mention of basic income followed a discussion of what is needed to cultivate a culture of entrepreneurship, during which he stressed that “the greatest successes come from having the freedom to fail” and lamented having known “too many people who gave up on pursuing their dreams because they didn’t have a cushion to fall back on if they failed.”
Speaking to an audience of millennials as a fellow millennial, the 33-year-old then declared, “Now it’s time for our generation to define a new social contract.”
Describing what this new social contract might look like, Zuckerberg proposed that “we should explore ideas like universal basic income to make sure everyone has a cushion to try new ideas.” He also called for other policy reforms such as affordable childcare and portable health insurance benefits (as opposed to the employer-linked health benefits that predominate in the United States), as well as continuous lifelong education.
Admitting that these reforms would not be free, Zuckerberg stated, “People like me should pay for it, and a lot of you are going to do really well, and you should, too.”
Zuckerberg then proceeded to other topics, such as the importance of charity and building communities at both local and global levels.
Although brief, Zuckerberg’s passing mention of universal basic income is noteworthy as the famed and influential entrepreneur’s first public comment on the topic. Moreover, while his singular remark was not an outright endorsement of the policy (as some headlines and social media posts quickly began to claim), it is clear that Zuckerberg sees it as at least worthy of serious investigation.
It is also notable that the Facebook CEO did not broach basic income as a solution to automation and technological unemployment, in contrast to some other tech entrepreneurs who have backed the idea (e.g., perhaps most famously, Elon Musk). Instead, Zuckerberg’s primary motivation seems to be the need to secure individuals against risk to facilitate, e.g., entrepreneurship, innovation, and cultural production.
Zuckerberg is not the first member of Facebook’s founding team to speak positively of basic income: cofounder Chris Hughes, a founding member and co-chair of the Economic Security Project, has become one of the policy’s foremost advocates in the United States.
Watch the full commencement address here:
by Florie Barnhoorn | May 24, 2017 | News
The largest trade union in The Netherlands with over one million members, FNV (Federatie Nederlandse Vakbeweging / Federation of Dutch Trade Unions), held a conference on May 10-11 at Sport Business Centre Papendal to discuss its policy plan for the years 2017-2021.
The policy is based on the experiences, opinions and observations of the members, non-members and experts of the organization. During a comprehensive consultation phase, each member had the opportunity to identify the most important topics which should be included in FNV’s conceptual policy plan for 2017-2021. A preliminary summary of the most important subjects was published in a separate draft resolution that was discussed by the Congress of the FNV on May 10. Despite several attempts to amend the draft resolution, the board of the FNV turned down all the proposals that went beyond the statement that “The FNV will investigate a basic income in the coming period and will start a discussion about it.”
However, on the 11th of May, during debates with members of FNV’s parliament and especially with the sector beneficiaries therein, this announcement was replaced by a more powerful and far-reaching text stating that
The basic income is an interesting option, especially in the way it is formulated by FNV Sector Beneficiaries. The FNV therefore proposes to start investigations and experiments in a practice-oriented manner based on the recommendations of FNV Sector Beneficiaries. As a result of this, FNV will decide whether a basic income can become one of the instruments that can equally share work, income and capital.
A ‘basic income’ as formulated by FNV Sector Beneficiaries is
- an amount that is comparable to the Dutch state retirement pension (AOW) in which a couple receives less than a single person;
- for anyone who has legally lived in The Netherlands during 18 years;
- income from paid employment will not be set off with the basic income;
- current allowances such as rent and care benefits continue to exist;
- unemployment and disability insurance also remains for that part of the income that comes from paid work.
“Due to the hard work and non-stop pressure of the section of welfare recipients among FNV’s members, they now have negotiated a much better outlook for the introduction of a real basic income in the long run,” says Johan Horeman, “A huge step is set in the right direction.”
The adoption of the amendment was made possible by the driving forces Willem Banning and Harrie Ortmans, board members of FNV Sector Beneficiaries and Johan Horeman, advisor of the board.
Thanks to Ad Planken and Dave Clegg for reviewing this article.
Credit Picture CC Terence Faircloth
