Felix FitzRoy and Jim Jin, “Basic Income and a Public Job Offer: Complementary Policies to Reduce Poverty and Unemployment”

Felix FitzRoy and Jim Jin, “Basic Income and a Public Job Offer: Complementary Policies to Reduce Poverty and Unemployment”

A basic income and job guarantee are commonly presented as competing solutions to poverty and economic insecurity. In a new paper for the Institute of Labor Economics, however, Felix FitzRoy and Jim Jin of the School of Economics and Finance University of St. Andrews make a case for combining the approaches.

According to the authors, proponents of a basic income often fail to give due attention to the importance of work and employment to subjective well-being and life satisfaction; unlike a basic income, a job guarantee can provide a good job for all those who want to work, and can also offer training and experience to allow individuals to advance to better jobs. At the same time, the authors argue that a job guarantee overlooks the importance of non-standard employment (they note, for example, that self-employed workers often report high levels of satisfaction, and value their autonomy) and unpaid labor, such as child and elder care.      

FitzRoy and Jin develop a proposal for a modest basic income (or partial basic income) in conjunction with a guaranteed job offer for those able and willing to work, striving to combine the advantages of each approach in a policy package that is also both affordable and politically feasible.

 

Read the full paper here:
Felix FitzRoy and Jim Jin, “Basic Income and a Public Job Offer: Complementary Policies to Reduce Poverty and Unemployment,” Institute of Labor Economics (IZA) Policy Paper No. 133.


Reviewed by Russell Ingram

Photo: Employment Office (1916), CC BY 2.0 Seattle Municipal Archives

Basic income and the ‘job ethic’

Basic income and the ‘job ethic’

Written by: Michael A. Lewis

I was recently listening to a talk show on public radio. The first segment was about President Trump’s tax proposals. It included a debate between a supporter of Trump’s plan and an opponent of it. The supporter is associated with the Manhattan Institute, a conservative think tank. Her conclusion was that Trump’s proposed tax cuts would be great because they would lead to more economic growth and, therefore, more jobs. This is, of course, the supply-side/trickle-down economics reasoning, which could be a subject of debate itself.

A later segment on the talk show focused on New York City’s attempt to persuade Amazon to set up its headquarters in the city. For those who may not be aware, New York City’s mayor is widely considered to be politically progressive. If you are more familiar with European politics, you can think of him as something like a Social Democrat. He did not appear on the radio program, but one of his deputies did. The deputy said a primary reason the city wants to attract Amazon is that such a move would generate a lot of jobs.

Thus, there was a representative of a progressive mayor and a conservative, both of whom argued for two very different proposals on the same basis — jobs. This is not that unusual. The U.S. political Right and Left disagree on plenty: tax cuts, the proper role of the federal government, how best to improve U.S. schools, what the U.S. Constitution says about the right to own a gun, and a host of other issues. But both sides can always be counted on to agree that whether someone has a job or not is an issue of utmost importance.

Conservatives may argue that the best way to generate jobs is for the government to get out of the way and let businesses “do their thing.” Progressives may counter that the private sector will never create enough jobs for all those who desire one, and that the only way to assure people can find work is for the government to guarantee a right to work, even if it must do the hiring. But for both sides of the U.S. political spectrum, jobs are what matters.

It makes sense that both the Right and Left would be so focused on jobs. The main source of many, if not most, incomes in the U.S. is a wage or salary. For many people, if they lost their job, it would not be long before things became dire for them. For many of those currently without jobs, things are already quite dire. It is in the nature of capitalism for most of us to toil away as “wage slaves” as the Marxists define it. But it seems that over time, this economic necessity has developed into something many people call the work ethic, but which I have come to think might better be called the job ethic. The job ethic is the culture which develops when what we have to do to survive becomes not just a source of income but also one of social recognition.

In her book Justice and the Politics of Difference, the late philosopher Iris Marion Young has an essay on the definition of “oppression.” That essay is called The Five Faces of Oppression, and one of those “faces” is marginalization. Marginalization is what happens to the involuntarily unemployed. Obviously, those faced with this situation have a serious financial problem, given that they are living within a system which requires them to have money to meet their needs. But, according to Young, this is not the main reason involuntary unemployment is oppressive. The main reason is that those who are unemployed lack something which grants them access to being recognized and esteemed by their fellow citizens/residents — a job. It is this lack of a job which makes the unemployed feel cast aside and marginalized. The fact that someone is not willing to hire them results in their feeling socially worthless.

Being a philosopher/political theorist, Young does not support her argument with figures and statistics. But I think she may be onto something. A number of opponents of basic income seem to think so, too. Anyone who has followed the basic income debate has heard the argument that basic income is imprudent public policy because it would result in less work. Less work would mean people would be less inclined to engage in an activity which provides them not just with income, but also with meaning and social recognition. What these individuals are really saying is that basic income is bad social policy because it would result in fewer people having to obtain meaning and social recognition from what they have to do to “put food on the table.”

In the past, I have questioned whether basic income would have this effect. But I’m also inclined to wonder: So what if it does?  As important as making a living is, humans do a lot of other things besides sell their labor. They spend time with children, spouses, and friends, they enjoy hobbies of various kinds, they engage in pursuits of higher learning, they become involved in civic pursuits to make the world a better place, and a host of other things. Can’t at least some of these things be sources of social recognition, as well? As long as capitalism and tasks that cannot be completed by machines exist, there will be a need for humans to sell their labor. But if a basic income freed some of us up to spend more time doing other things which provide us with social recognition, would that really be so bad?

About the author: 

Michael A. Lewis is a social worker and sociologist by training whose areas of interest are public policy and quantitative methods. He’s also a co-founder of USBIG and has written a number of articles, book chapters, and other pieces on the basic income, including the co-edited work The Ethics and Economics of the Basic Income Guarantee. Lewis is on the faculties of the Silberman School of Social Work at Hunter College and the Graduate and University Center of the City University of New York.

UNITED STATES: Joe Biden believes that jobs are the future, rather than basic income

UNITED STATES: Joe Biden believes that jobs are the future, rather than basic income

Joe Biden. Credit to: GQ.

 

Joe Biden, Obama’s ex-vice president, is confident that the reinforcement of the job-centered culture is the answer to the challenges already affecting work marketplaces in the US, as written in his blog at the Biden Institute. He supports this vision instead of the idea increasingly put forward by Silicon Valley moguls: unconditional basic income.

 

Biden, recalling his father’s words, wrote that he considers jobs to not only be a source of income, but also and foremost about “human dignity and self-respect”. Given that starting position, he is campaigning for an American economy that grows and “put(s) work first”. This, of course, is linked with the educational system and professional retraining, both areas in which Biden calls for profound changes, while maintaining “key workplace benefits and protections (…) in an economy where the nature of work has changed”.

 

Basic income is given little attention in the cited blog post, summarized only briefly as something that is just boiling up in Silicon Valley due to transformations, present and future, introduced by automation. However, automation concerns have only been one issue among several that can justify introducing an unconditional basic income, such as the elimination of poverty, reducing inequality,  solving bureaucratic unemployment and poverty traps and creating more gender equality. Also, as extensive data shows, basic income interest is growing all around the world (e.g.: Canada, UK, Finland, Netherlands, Germany), not only among the Silicon Valley milieu.

 

 

More information at:

Joe Biden, “Let’s choose a future that puts work first”, Biden Institute Blog, 2017

Hugh Seal, “Finding a better way: a basic income pilot project for Ontario”, Discussion Paper, Massey College, August 31st 2016

Kate McFarland, “”Reducing poverty and inequality through tax-benefit reform and the minimum wage: the UK as a case-study””, Basic Income News, August 30th 2017

Kela, “From idea to experiment: report on universal basic income experiment in Finland”, Working papers 106 | 2016, Helsinki, 2016

Genevieve Shanahan, “Patricia Schulz “Universal basic income in a feminist perspective and gender analysis””, Basic Income News, March 6th 2017

Polish journal Theoretical Practice devotes issue to basic income and job guarantee

Polish journal Theoretical Practice devotes issue to basic income and job guarantee

The Polish political philosophy journal Praktyka Teoretyczna (“Theoretical Practice”) has published a special issue on the relative merits of a basic income and job guarantee.

The contents of the issue are freely available online, although only in Polish.

Contributors contain a mix of supporters and critics of each of the two policies.

Mariusz Baranowski and Bartosz Mika compare basic income and job guarantee programs with respect to a variety of metrics, including funding and cost, impact on existing social security systems, impact on income inequality, and emancipatory effects, ultimately favoring a job guarantee. Pavlina Tcherneva investigates the relative macroeconomic impacts expected from the two types of policies, arguing that a job guarantee possesses an economic stabilizing effect not possessed by basic income. Further, Tcherneva argues that a job guarantee has a greater potential to contribute to sustainable development and ecological goals.

Angelina Kussy and Félix Talego Vázquez, on the other hand, argue for a basic income as a component in a new understanding of work. The authors use ethnographic research of the communitarian Spanish village of Marinaleda to critique contemporary notions of “work”. Zofia Łapniewska also questions the assumptions that form the foundations of current economic institutions–developing a proposal for an alternative economy based on the ethics of care. She uses this as a basis for further consideration of policies including basic income and employment guarantees.

In addition to original articles, the issue also includes a review of BIEN cofounder Guy Standing’s 2017 book Basic Income: And How Can We Make It Happen, as well as a review of the work of economist Mariana Mazzucato.

The edition was edited by Maciej Szlinder, who is Praktyka Teoretyczna’s political philosophy editor as well as an active participant in Poland’s basic income movement.

Praktyka Teoretyczna is an open-access peer-reviewed journal, with new issues published quarterly. Its content focuses on “continuously question[ing] the relation between theory and practice”, and is especially aimed at fostering the development of young researchers.


Reviewed by Caroline Pearce

Photo: Worker in Poland, CC BY 2.0 Chris

United States: Hawai‘i to study Universal Basic Income and impact of job automation on social safety net

United States: Hawai‘i to study Universal Basic Income and impact of job automation on social safety net

Representative Chris Lee. Credit to: Office of Representative Chris Lee

 

In the face of growing economic inequality and projections of increased disparities in the coming decades, Hawaii has passed a resolution to establish a Basic Economic Security Working Group. The working group will investigate the impact job automation will have on the residents of Hawaii and its social safety net programs, and investigate the feasibility of universal basic income models and other efforts to identify the best pathway forward to ensure residents are able to thrive, if you’re wanting to be a thriving Hawaii resident, you have the option to live on the big island of Hawaii if you so wished to.

Hawai‘i has the highest cost of living in the United States. It is thus no surprise that the rate of economic inequality in Hawai’i has been steadily rising for decades, and that the top 1% income shares have doubled since 1978. In response, House Concurrent Resolution 89 was passed in May 2017 to establish a Basic Economic Security Working Group, focusing on five main tasks:

  1. “Assess Hawai‘i’s job market exposure to automation technologies, globalization and disruptive innovation;
  2. Assess Hawai‘i’s existing spending on social safety net programs and other relevant expenditures, as well as expected spending on those programs in light of anticipated automation technologies, globalization, disruptive innovation, and job losses;
  3. Identify and analyze options to ensure economic security, including a partial universal basic income, full universal basic income and other mechanisms;
  4. Monitor studies, trials, and efforts in Hawai‘i and other jurisdictions relevant to the basic economic security working group; and
  5. Seek out partnerships to publish or fund relevant trials or studies to evaluate options”

In an interview with Basic Income News, the sponsor of the resolution, Representative Chris Lee, frames the working group in light of the broader political context of the United States: “Politics in D.C. necessitate our evaluation of these future options because current policies are only making things harder for middle and lower class families. We must ask ourselves, what can we do now to head down the right path to ensure a viable economy and sustainable ways of living?”

Representative Lee went on to claim that, when future socio-economic landscapes are viewed through the lens of innovation and automation, some form of a basic income “seems inevitable”. The representative states that it is imperative to “acknowledge there are real issues both in our economy and society that current policy is not equipped to deal with” and that our economic and social infrastructure must evolve to match the speed of technological innovations.

Given that, in 2016, the service industry composed the majority of the state’s total GDP, automation may be one of the greatest challenges to its economic security in the near future. This threat is even more pressing given projections of the United States losing almost half of all jobs to automation in the next two decades. Hawai‘i’s resolution is proactive in addressing the specters of job loss and increased reliance on social safety net programs by mapping the potential future impact and mitigating negative effects with evidence-based strategies to inform legislation.

The majority of households in Hawai‘i are families with children. Representative Lee is mindful of how their lives can be shaped by economic insecurity and is working to create pathways forward to ensure people can thrive.

 

More information at:

Bureau of Economic Analysis, Hawaii, U.S. Department of Commerce, 2016

Oliver Garret, “How The Coming Wave of Job Automation Will Affect You and the U.S., Forbes, February 23rd 2017

Hawaii State Legislature, Representative Chris Lee, 2017

House of Representatives Twenty-Ninth Legislature, HCR 89, Open States, May 2017

InfoPlease, Demographic Statistics Hawaii, June 2017

Emmie Martin, “These are the 15 Most Expensive US States, CNBC Money, May 15th 2017

Carlyn Tani,”Hawaii’s Growing Inequality“, Hawaii Business, March 2015