by Liam Upton | Jul 13, 2015 | News
Ireland’s Fianna Fáil party will include a commitment to a Basic Income of €230 a week in its manifesto for next year’s general election.
The news was revealed by Fianna Fáil spokesperson for social protection and social equality, Willie O’Dea in an interview with the Sunday Times newspaper. O’Dea said that he will outline the plan in the party’s social protection policy document, which is due to be published in a few week’s time.
This commitment makes Fianna Fáil the most significant party in Ireland to support Basic Income, they are currently the largest opposition party and are usually the third largest party in opinion polls, not far behind those in front. The €230 Fianna Fáil proposal is also higher than that suggested by Social Justice Ireland, who presented a Basic Income affordability study at a BIEN conference in 2012. The Green Party also supports Basic Income but has never campaigned on it nor laid out a concrete proposal.
In terms of costing, the document says that refunding tax credits would be the first step to a Basic Income and that “Any income earned above [the Basic Income] would be taxed at a new single rate.”
The policy document will also outline some of the justification for Basic Income, making a number of criticisms of Ireland’s current taxation and social welfare system, noting that social work such as caring and volunteering go financially unrewarded. It will further mention that “It would promote gender equality, as all forms of ‘work’ are rewarded, not just paid employment.” and that “It would remove poverty traps and unemployment traps, as seeking paid employment or increased income would still be worthwhile.”
The inclusion in Fianna Fáil’s manifesto reflects the increasing political support Basic Income has been receiving worldwide in the last year.
by Joerg Drescher | Jul 6, 2015 | Opinion
In general terms, power is “to make someone want what you want”. You can use hard power – physical force or punitive measures, such as economic sanctions – to achieve this goal. However, there is another way – you can appeal to the reason of those, whose behaviour you want to change, by rewarding (sometimes seducing or bribing) means. The latter is called soft power.
In this article I use the conflict between Russia and Ukraine to show how a basic income – a regular payment to individuals irrespective of their income – could strengthen soft power.
As some of you may already know, I witnessed 2013/14 the revolution in Ukraine. Last year, right after the revolution, Crimea was illegally annexed by Russia and soon after Russia-supported terrorists have started a military aggression against Ukraine in the east of the country. As a response, the European Union, the United States and several other countries have introduced economic sanctions against Russia. This was legally backed up by the General Assembly of the United Nations, when more than 100 countries voted to affirm the territorial integrity and sovereignty of Ukraine and made it very clear that the phoney ‘referendum’ in Crimea was illegitimate and illegal.[1]
However, a group of investigative journalists found out that the realisation of the EU sanctions is not controlled. Each member state decides on its own, whether to implement the sanctions or not. As a result, almost no assets of sanctioned Russian and pro-Russian Ukrainian politicians, officers and businessmen were seized as intended by the EU. Later, the Institute for Economy Research in Vienna conducted a study on how the EU economy could be affected by their own sanctions. The findings showed that in a worst-case scenario about two million jobs and a value added of 100 billion euros could be lost within the European Union, if the sanctions were, in fact, implemented.[2] On top of that, Ukraine is far from being the only problem in Europe. The euro crisis, the situation in Greece, and a swing to the far right are setting alarm bells ringing in the EU.[3]
Thus, an euro-dividend proposed by Philippe van Parijs[4] – a similar idea to basic income – would make the unemployment issue in the EU less dramatic, because it provides a social security net. Either proposal could solve the euro crisis or the situation in Greece, and also help stop driving excluded people to political extremists.[5]
Now you may think that basic income would rather strengthen hard power than soft power, since the EU member states would get an opportunity to sanction Russia without having negative effects on their own economy. Your way of thinking is right. However, basic income does also strengthen soft power.
According to Joseph Nye of Harvard University, a country’s soft power rests on three resources: “its culture (in places where it is attractive to others), its political values (when it lives up to them at home and abroad), and its foreign policies (when others see them as legitimate and having moral authority).”[6]
Taking these resources into account, a basic income could strengthen soft power, because it makes it easier for the EU to implement the foreign policy by imposing sanctions against Russia (legitimated by the UN) and, most importantly, by having a moral authority – as the EU would show it cares about its people and does not leave them economically alone with the effects of those sanctions.
This picture, which was at the barricades on the Maidan in Kyiv, shows that Ukraine wants to go with the EU instead of being dependant on Russian gas and adopting an authoritarian system like in Russia (picture by Ralf Haska)
Thinking back how the “Revolution of Dignity” in Ukraine started, it is obvious that the EU attracted Ukrainians with its culture and political values. When the former president Victor Yanukovych refused to sign a long-negotiated Association Agreement with the European Union, it caused deep indignation among many Ukrainians.[7] Even now, when Ukraine is war-torn and facing huge economic recession, to a great extent, due to the corrupt regime of Yanukovych, the EU is still more attractive than the authoritarian regime of Russia to most Ukrainians.
However, Ukrainians have to pay an enormously high price for their European choice. Beside the fact that there is an on-going military conflict in Eastern Ukraine resulting in tragic human loses, displacement and destruction of homes and infrastructure, they have to accept painful reforms, which decrease their income. They have to face inflation, increasing costs (mainly for energy), the devaluation of the national currency (hryvna lost more than 100 per cent from its value before the revolution) and unemployment (thousands of civil servants lost their jobs in the state sector and the jobs in the private sector are not secure).
A basic income could help Ukraine solve several problems – mainly related to corruption and social politics.[8] Ukrainians are not job-, but rather “income-less”: myriad volunteers have been helping and supporting more than a million internally displaced persons, the army, bereaved family members of killed or wounded civilians and soldiers all over the country. Even the most needy Ukrainians are willing to share what little they have to help and defend their country. The question may arise: what for?
If the EU is selling its moral values by caring more about the welfare of its economy and defending its assumed status quo rather than caring about the well-being of its people, it might lose its soft power by disappointing not only Ukrainians, but also its own people. Therefore, I think a basic income could strengthen soft power – by being attractive through common shared values and bringing back the end of the community of states to its origin: keeping peace within and among countries and in the world.
Sources:
[1] Samantha Power, answer at Facebook, approximately 2:30 minutes, 16. May 2015
[2] Video of Joerg Eigendorf (English, approximately 3 minutes), Die Welt, 19. June 2015
[3] “Strange Bedfellows: Putin and Europe’s Far Right”, World Affairs, by Alina Polyakova, autumn 2014
[4] Video of the lecture by Philippe van Parijs: “No Eurozone Without a Eurodividend” (approximately 1,5 hours), BIEN-Congress in Munich 2012
[5] Interview with Guy Standing (approximately 2 minutes), 14. February 2010
[6] “The Future of Power” by Joseph S. Nye, chapter “Sources of Soft Power”, PublicAffairs, 2011
[7] “Opinion: Basic Income and the Ukrainian Revolution” by Joerg Drescher, 30. December 2013
[8] “Opinion: Universal and Guaranteed Income? A Matter of Basic Rights” by Emanuele Murra, 30. April 2012
Further readings on soft power:
A Theory of Soft Power and Korea’s Soft Power Strategy
by Francisco Nobrega | Jun 12, 2015 | Opinion
The debate and protests over the importance of an unconditional basic income policy for our time have been spreading worldwide and gathering momentum. Here in Brazil we keep an open ear due to the success of conditional transfer policies (The Bolsa Família program) and also because we have a moot 2004 law that says that such universal and unconditional money transfer is to be inaugurated in Brazil, “in steps”. Most view Bolsa Família as one such “step”. I have been following the idea for over five years together with other activists, trying to implement a basic income pilot program here, in a small city. This is a distilled reflection of my current view about how to make utopia turn into a “protopia”, a term proposed by Kevin Kelly as a “gradual improvement in humanity” or a viable utopia.
The camp of supporters in the world is diverse and we can see two distinct and extreme interpretations of the idea:
One group sees basic income as a way to increase government through social welfare and “eliminate” work that they see as exploitative and envision complete maintenance of social services and centralized decisions, besides the monthly unconditional grant, independent from work.
Another group embrace basic income as a tool to drastically reduce government, replacing the social programs with the monthly grant independent of work.
These polarized views also disclose an important characteristic of the idea: it attracts people from the entire political spectrum, something that certainly will help future implementation. There is another surprising coincidence in all basic income visions reported in writing and video: the unanimous presentation of what I will call the “classical model”: the monthly grant will be bestowed upon all: rich, middle-class, poor and unemployed. I seldom met anyone who dared to challenge the idea of rewarding people with economic means and a job. To me this is in contrast with was in fact a strategy to eliminate poverty and the attached main evil of social welfare programs: the “poverty trap”. This is a phenomenon in which you punish economic success by removing the benefit as soon as someone is employed or becomes an entrepreneur. The poverty trap creates an incentive to stay put and avoid the risk of relinquishing the subsidy and face the competitive world outside.
A basic income payment is a right for everyone without a decent earning, whatever the reason. The logical justification is that society as a whole has been unable to provide opportunities for everyone either as an entrepreneur or an employee with the government or the private sector. Additionally the increasing efficiency in production, and the great advances in microelectronics, artificial intelligence and robotics are on the way to eliminating jobs on a massive scale. Brynjolfsson and McFee1 have shown that notwithstanding a continuous rise in productivity, the last two decades exhibit a marked reduction in job opportunities. Frey and Osborne2 released a very interesting study of 702 occupations, identifying many that are on the road to extinction due to the modern trends mentioned. In the US the authors estimate that 47% of jobs are at risk of being automated within a decade or two. This will add to the jobs already lost by “off-shoring” manufactories. Also a fundamental psychological barrier exists and resides in the deeply engrained notion that income has to be linked to work. People will have to overcome this notion just as we had to overcome certain prejudices in the recent past related to slavery, torture and the rights of women and minorities, finally embracing solidarity in the economic realm.
It is our duty as a civilized society to provide a monthly grant that will allow those without means to provide for their basic needs. But the classical model of basic income is unjust in handing over cash to those who are well off. This practice could be acceptable if we suppose that a given population was living within the same level of their means. Then the grant would be a benefit equal to all. In all countries we have a centuries-old history of inequality. In Switzerland just about one citizen in 13 is poor and needs help from the state. In Brazil about one-quarter of the population is poor and are presently helped by the Bolsa Família program. The cost of benefiting everyone will be a formidable barrier to implement the idea besides being unjust. The classical model was probably born out of our prejudice against people receiving money without pay. Apparently to appease the well off, the most indignant against giving “money for doing nothing”, the classical model wants to “buy” them as beneficiaries of the idea. But we have to give cash “for doing nothing” because the affluent societies of today have to be responsible for the lack of job opportunities. Giving cash to the needy and letting them choose what to do with it has been shown to be not only just but also cost effective. Among other pilot experiments like the one in India3 it is noteworthy to remember the success of giving cash to homeless people in London4 or home for the homeless in Utah5. The excellent results cost less than the usual city expenses for caring for the homeless in both cases. The winning GiveDirectly initiative in Kenia and Uganda also reinforces the idea of addressing the poor. Many other experiments exist with excellent results.
The social services network present in all countries should be used. The first measure I propose, considering Brazil, is to remove all conditionalities linked to Bolsa Família or to unemployment benefits. The bureaucracy should analyze requests from the needy, families or individuals without income. After entering the monthly grant system the newcomer would have a generous time interval (years) before the grant expires. This longer interval will remove the “poverty trap” long enough for progress out of the grant system. In case a lack of income remains, the person/family will apply, near the end of the allotted time, to stay in the system. So whoever is in need will be helped and whoever falls into economic need will be supported. The amount paid should be enough for the basic needs of the person/family. Recipients who want to advance economically will pursue whatever full or part-time jobs are available or even start a business. The basic monthly cash should be followed with provisions of communal facilities for support and education for the beneficiaries whenever appropriate. In parallel, some of the suggestions exposed6 in the “Get America Working!” study could be implemented to reduce the cost of having workers by means of a tax rearrangement that would drastically shorten the current payroll expenses and many more jobs could be created.
Reducing economic uncertainty will have multiple benefits for society: the mental health value of reducing the anxiety and stress linked to insecurity, the social environment will be safer, and most importantly, the poverty trap will be neutralized, unleashing the creative potential of men and women.
Francisco G. Nóbrega
MD, PhD, is President of the Municipal Council for the Citizen’s Basic Income in the city of Santo Antonio do Pinhal, SP, Brazil. francisco.nobrega@gmail.com
The opinions expressed here are solely those of the author. I thank Jim Hesson for improving the English and suggestions by him and Marina P. Nobrega.
1- Race Against the Machine – how the digital revolution is accelerating innovation, driving productivity, and irreversibly transforming employment and the economy. Erik Brynjolfsson and Andrew McFee, 2011, Digital Frontier Press, Mass, USA
2- The future of employment: how susceptible are jobs to computerization? Carl Benedikt Frey and Michael A. Osborne, 2013, https://www.oxfordmartin.ox.ac.uk/downloads/academic/The_Future_of_Employment.pdf
3- Basic Income: A Transformative Policy for India. Sarath Davala, Renana Jhabvala, Soumya Kapoor Mehta, and Guy Standing. New Delhi: Bloomsbury Publishing India, December 2014.
4- The London experiment: https://www.washingtonpost.com/opinions/free-money-might-be-the-best-way-to-end-poverty/2013/12/29/679c8344-5ec8-11e3-95c2-13623eb2b0e1_story.html
5- The Utah experiment: https://www.newyorker.com/magazine/2014/09/22/home-free
6- Get America Working! site: https://www.getamericaworking.org
by Andre Coelho | Jun 6, 2015 | News
Local Finnish authorities at Åland, a Swedish speaking archipelago between Finland and Sweden mainland, are considering, within their territory, the creation of a special fiscal zone where basic income-like social experiments could be performed. The Åland Office of the Social Insurance Institution of Finland presently manages conditional basic income benefits for locals, but could be on the brink of taking the next bold step of turning these benefit schemes entirely unconditional.
The recently elected Center Party, which is presently the most represented party in the Finnish Parliament and supporter of Basic Income, is willing to regionally experiment its implementation. That is why Sonja Nordenswan, activist in basic income support group BINK – basinkomst Åland (Åland basic income), is confident about the possibilities of this government actually moving forward with this projet.
Anna Wiksten, Sonja Nordenswan, Erica Scott. Foto: Tomas Tornefjell.
In a recent radio program from Åland local radio and TV network RTV, Sonja Nordenswan has also referred to a possible 1000 € per month basic income, which could replace most of present day state funded benefits, such as social security, unemployment benefits and tax credits. These and other aspects were debated at this radio venue, organized by ABF, an Åland based association of workers focused on learning processes, training and culture.
More information at:
Åland Office of the Social Insurance Institution of Finland, 2015
In Finnish:
Tomas Torre Fjell, “Åland as a testing field for Basic Income [Åland testområde för basinkomst]“, RTV Åland radio/tv, May 25, 2015
Liam Upton, “FINLAND: Pro-Basic Income Centre Party wins election“, April 20, 2015
Credit picture CC ehrenbergkommunikation
by Citizens' Income Trust | Jun 5, 2015 | Opinion
John Hills, Good Times, Bad Times: The welfare myth of them and us, Policy Press, 2014, 1 44732 003 6, pbk, xviii + 323 pp, £12.99
The title says it all: the normal experience for most families and individuals is that there will be good times and bad times; and it is simply not true that society is made up of two relatively stable groups: one group of people that pays for the welfare state, and the other that benefits from it. The political polemic of ‘strivers’ and ‘skivers’ is precisely that: political polemic. At different points in our lives we might be net contributors or net recipients in relation to the welfare state, but there is nobody who does not at some stage benefit from its provisions. Another myth that the book challenges is that vast sums are spent on supporting people who are ill, disabled, or out of work, whereas in fact the budgets for the relevant benefits are small compared with the budgets for the pensions and healthcare from which all of us benefit.
The author employs a number of literary devices to get his message across. He writes about the different ‘wavelengths’ along which changes occur: for instance, the long wavelength within which we accumulate and then run down assets as we progress through middle age and into old age; and the short wavelength of coping with the loss of income precipitated by unemployment or illness. And throughout the book he follows the fortunes of two fictitious but recognisable families: the middle class Osbornes, and the working class Ackroyds.
If you don’t have time to read the whole book, then read the diagrams and text about these two families at the beginning of each chapter. The picture that they reveal is that both families benefit from the welfare state, and that taking the tax and benefits systems as a single system, the Osbornes do rather well out of it. But if you do have time to read the whole book then you will find that the mass of survey data discussed in the body of each chapter reveals a highly complex picture, an important characteristic of which is that what is normal for the Ackroyds is rapid and frequent change in their economic position. One week a government minister might describe them as ‘skivers’, and the next they would be praised as ‘strivers’. Another important characteristic that hits the reader time after time is the effect of initial social and economic capital on economic and social capital outcomes. The social mobility ladder seems to have some rungs missing.
Along the way, we discover how unequal predistribution is in the UK compared with most other countries, and how much harder our welfare state therefore has to work to generate a little more equality; we notice how much everyone benefits from the welfare state, particularly in childhood and old age; we discover how difficult it is for Working Tax Credits – and in the future how difficult it will be for Universal Credit – to respond to the rapid changes in income level experienced by an increasing number of households; we understand how current austerity measures reduce the incomes of low income households but largely protect the incomes of higher earners; and we find that wealth inequality is exacerbated by a tax system that rewards the already wealthy and a benefits system that takes household wealth into account when benefits are calculated.
John Hills is the Director of the Centre for Analysis of Social Exclusion at the London School of Economics, and this book is full of thorough analysis of social exclusion. A few questions are asked at the end about the ways in which future policy might take into account the book’s findings, but Hills leaves it to others to work out what should be done to rectify the situation that he discovers.
Of particular interest to readers of this Newsletter will be the numerous ways in which a benefits system based on a Citizen’s Income would respond to the problems explored in the book. In particular, a Citizen’s Income would cohere far better with rapidly gyrating earnings than means-tested benefits will ever manage to do. But perhaps the most important lesson that the book holds for anyone promoting debate on social policy reform is that however thoroughly robust evidence and logical argument manage to demolish myths perpetrated by the press and by politicians, those myths persist. So perhaps however good the evidence that a Citizen’s Income would be feasible, the myth will persist that it isn’t. If John Hills’ book manages to reduce the potency of the myth of them and us, then some of us might begin to hope that the myth of a Citizen’s Income’s infeasibility might one day lose some of its strength.
