by Hilde Latour | Jul 17, 2017 | News
Investopedia published an article in May this year, “The Long, Weird History of Basic Income – And Why It’s Back”
In this article, written by David Floyd, the history of support of UBI is described from the period of hunter-gatherer societies and how the networks in those societies took care of people who could not provide themselves with a basic standard of living. The article then describes how agriculture and urbanization made an end to such networks and how problems were not handled well by the institutions that took the place of the original networks, referring to Charles Eastman who described this problem in 1915.
Thomas Paine was one of the famous people who noticed the creation of poverty, caused by cultivation, which did not exist before. He was the first to propose a UBI (Paine called it a “groundrent”) in the late 18th century, as a compensation for the dispossession of the majority of inhabitants of their natural inheritance. Cole first used the term Basic Income in 1953.
From Paine, via Henry George, Huey Long, G.D.H. Cole, Martin Luther King, Mc Govern and Nixon, the current boost of support for UBI in the 21st century is explained as a reaction to poverty and inequality, predominantly used as an argument by proponents on the left political spectrum, and inefficiency of the welfare state, used as an argument on the right wing.
In addition to the political perspective, a distinction between “reformers” and “futurists”, which cross-cuts left and right, is described in further depth.
The group of “reformers” is described as a group of basic income supporters who is mostly concerned with addressing problems in society as it is now, mostly caused by the broken welfare system, such as:
- “Employment traps” (where people are kept form leaving their job out of fear and bad employers are supported as a result of that)
- “Unemployment traps” (“earn a dollar from work, lose a dollar in benefits”)
- “Welfare cliffs” (where the effect tax on additional income even exceeds 100%)
- Stigma associated with public benefits
- Bureaucratic inefficiency
The group of “futurists” is described as supporters who see technological unemployment as a main threat in the future and offer basic income as a solution or who see a basic income as a cornerstone of an eventual utopia.
The two main criticisms of a universal basic income are its cost and the expectation that it would reduce or eliminate incentives to work.
This discussion is described with calculations of “The Economist” and views of Bill Gates, Karl Widerquist, Guy Standing, Philippe van Parijs and others. Brief attention is given to Alaska’s “Permanent Fund Dividend” and the outcome of experiments, such as Manitoba and India. Furthermore, the definition of ‘work’ is discussed, the effects of UBI on poverty and even the experiments in Finland, Oakland and Ontario get attention.
Floyd summarizes his article with a question: “Could doing away with poverty, sweeping away patronizing bureaucracy, neutralizing the threat of mass unemployment and increasing the value society places on worthwhile, but unprofitable, pursuits really be as simple as handing everyone cash?” He then uses Confusius’ quote to guide us towards the answer:
“The way out is through the door.”
Info and links
Full article at investopedia.com
Photo: Money! by Hans Splinter, CC-BY-SA 2.0
Special thanks to Dave Clegg for reviewing this article
by BIEN | Jul 15, 2017 | News
Credit to: AT Kearney.
Courtney McCaffrey and others from AT Kearney published an article on the debate around Universal Basic Income (UBI) in markets throughout the world. Politicians, in both Europe and North America, are winning on campaign trails with talk about returning control to the common people from the economic system in the globe.
But one of the big worker displacers is automation and new technologies. Oxford University reported 47% of US jobs will be taken over by automation in the next two decades. A UBI is being offered as an economic buffer for such workplace and technology transitions.
Such a UBI would be universal and unconditional in the application. Past UBI experiments such as Mincome in Canada, projects in Seattle and Denver (USA), and Namibia produced real, positive results empowering those politicians. McCaffrey and her collegues also mention recent major endorsements for UBI, for instance from such luminaries as Elon Musk, Tim O’Reilly, and Marc Andreessen.
Two books are recommended: 1) Utopia for Realists by Rutger Bregman, and 2) Basic Income: A Radical Proposal for a Free Society and a Sane Economy by Philippe Van Parijs and Yannick Vanderborght. Other notable cases reported on were Finland, India, and Ontario.
The article discusses pros and cons of UBI, in a general sense. It was noted that citizens with a UBI will spend more time on family and school. The sources of funding for the UBI could be revenues from natural resources and/or more taxes. Some views of critics are following their own political lines, but the major concern revolves around people’s availability to work when they get a UBI covering their basic needs.
Finally, the article summarizes views agains UBI on the political Right and Left. On the Right, the main argument is cost. On the political Left, detractors view UBI as “regressive” because it could dismantle current welfare systems, and that it may not capture different living costs in different areas.
More information at:
McCaffrey, C.R., Toland, T. & Peterson, E.R., “The Best Things in Life Are Free?“, AT Kearney, March 2017
by Kate McFarland | Jul 11, 2017 | News
The municipalities of Groningen, Wageningen, Tilburg, Deventer, and Ten Boer have received permission from the Dutch Ministry of Social Affairs and Employment to proceed with proposed social assistance experiments.
Jetta Klijnsma, CC BY 2.0 Partij van de Arbeid
Jetta Klijnsma, State Secretary of Social Affairs and Employment, signed the authorization of the five municipal experiments on July 3, 2017.
Groningen and Ten Boer will be carrying out their experiments in cooperation with one another.
In each of the experiments, which will run for two years, participants will be randomly selected from a pool of current social assistance beneficiaries (with participation voluntary for those selected), and assigned either to a control group or to one of several treatment groups.
Each experiment has at least three treatment groups, testing the following types of interventions: (1) removing reintegration requirements (e.g. job applications and training programs) on welfare benefits; (2) providing a more intensive form of reintegration service; (3) permitting participants to earn additional income on top of their welfare benefits. Subjects assigned to the third treatment groups will be permitted to retain 50% of additional earned income, up to a maximum of €199 per month, for the duration of the two-year experiment. In contrast, under current policy, welfare recipients are permitted to keep only 25% of additional income, and only for up to six months.
The Groningen / Ten Boer experiment includes a fourth treatment group, in which participants are permitted to choose to join any one of the three preceding groups.
Although international media have referred to these experiments as “basic income experiments”, the description is a bit of a misnomer. In all treatment groups, benefits remain means-tested and household-based, and participation is limited to current welfare recipients. Moreover, legal constraints create an effective demand on participants to seek work (on pain of removal from the experiment); this effective conditionality, unique to the Dutch experiments, is discussed below.
Sjir Hoeijmakers, an econometrician who consulted municipalities in their design of the experiments, prefers to speak of “experiments in the context of the Participation Act” (cf. this Basic Income News article), while others refer to “social assistance experiments”.
The experiments are expected to begin around October 1 of this year.
The Ministry of Social Affairs and Employment is currently reviewing applications from three additional municipalities who also wish to conduct experiments on social benefits: Amsterdam, Nijmegen, and Utrecht. Decisions on these proposals are expected later in the summer.
Update: Shortly after the publication of this article, Nijmegen was granted permission to carry out its experiment, which will commence on December 1. A full report on Nijmegen’s experiment will follow.
Background
The municipalities of Groningen, Tilburg, Wageningen, and Utrecht have been planning social assistance experiments since 2015, following the enactment of the Dutch Participation Act. Originally, these experiments were conceived as trials of unconditional basic income (or at least policy moving in this direction), although political pressures encouraged their proponents not to use the term “basic income” (which is popularly associated in the Netherlands with utopian thinking and celebration of laziness). Under the Participation Act, municipal officials are required to implement obligations and sanctions to encourage recipients of social assistance benefits to seek employment. For example, beneficiaries are generally expected to complete a set number of job applications per week, participate in training programs, and attend group meetings as conditions on receiving their benefits. Skepticism regarding the effectiveness of these conditions was a main motivation of the experiments.
In September 2016, Klijnsma authorized municipalities to perform experiments, up to two years in duration, testing the effects of altering the conditions of the nation’s social assistance benefits. This authorization was granted, however, only under strict terms of compliance with the nation’s Participation Act, which effectively prevent the municipalities from testing an unconditional basic income (despite interest in the idea from researchers and promoters of the experiments). For example, in the case in which an experiment treatment involves the removal of work reintegration requirements, the Ministry mandates that officials assess test subjects after six and twelve months to verify that they have made adequate effort to find employment; those who have not done so are subject to dismissal from the experiment.
The Ministry also capped the amount of earned income that participants are permitted to retain on top of their benefits, and required that any experiment including a treatment group with relaxed conditions on social assistance also include a treatment group with stricter conditions.
In the face of these constraints, researchers were forced to design experiments farther from “basic income experiments” than originally desired.
After announcement of a start date of May 1, 2017, Utrecht saw its proposed experiment put on-hold due to a failure to comply with the terms of the Participation Act. The city has since submitted a revised proposal to the Ministry of Social Affairs and Employment, which is pending evaluation.
Another municipality, Terneuzen, proposed a small-scale study of basic income–providing unconditional cash payments of €933 to 20 test subjects–which was axed by Klijnsma earlier in the year. Terneuzen has not submitted a new proposal to the Ministry of Social Affairs and Employment.
In a recent presentation to the Dutch branch of BIEN, Sjir Hoeijmakers stated that 45 municipalities are considering social assistance experiments.
More Information
“Eerste vijf gemeenten krijgen toestemming voor bijstandsexperimenten” (July 3, 2017). Official press release of the Dutch government.
Charlotte Huisman, “Vier steden mogen experimenteren met soepelere bijstand,” Trouw, July 3, 2017.
“Should the Netherlands test the basic income,” EuroTopics, July 4, 2017.
Previous Basic Income News Coverage
Florie Barnhoorn, “The Netherlands: All that’s left is the action. Where do we stand with the experiments?” (June 2, 2017).
Kate McFarland, “THE NETHERLANDS: Social Assistance Experiments Under Review” (May 9, 2017).
Florie Barnhoorn, “NETHERLANDS: Design of BI Experiments Proposed” (October 26, 2016).
Information provided by Florie Barnhoorn, Hilde Latour, and Ruud Muffels.
Photo (Tilburg) CC BY-NC-ND 2.0 Stephan Ohlsen
by Hilde Latour | Jul 7, 2017 | News
In May this year, Bryan Caplan debated with Karl Widerquist about Universal Basic Income (UBI) and Welfare at PublicSquare.net.
Widerquist is associate professor at the Georgetown School of Foreign Service at Qatar and vice-chair of Basic Income Earth Network (co-chair at the time of the debate). He sees UBI as a means to completely eliminate poverty and as a compensation for the government’s actions to turn resources into property, which creates groups of people that don’t have access to resources they need to survive. Widerquist predicts UBI will also have an increasing effect on lower level wages, as the payment for work will need to be high enough for a non-starving person to accept the job. In the current system, employers don’t have the incentive to provide good wages, according to Widerquist.
Caplan is professor of economics at George Mason University. He thinks the idea that everyone should be supported by the government is ridiculous. Whatever charity is given should only be for to the people who need it, and UBI is therefore not a good idea, according to Caplan. Furthermore, it will discourage people from working and is not fair to people that are paying their taxes, he states.
Info and links
Photos: Karl Widerquist by BICN/RCRG Basic Income Canada Network, 2014 and Bryan Caplan speaking empathically by Eric Hanneken, 2015, CC-BY-SA 2.0
Special thanks to Dawn Howard for reviewing this article
by Pedro Alves | Jul 6, 2017 | News
Picture: credit to Radar.
In the Netherlands, the program Radar started a petition to persuade the government to give a basic income for people over 55 years old as an experiment. While a pilot is required to go through with it, only 3% of people nowadays get a full-time job at this age range.
The experiment could consist of 2000 people in the treatment group and 2000 people in the control group. In more than 100 comments and reactions to this petition, no one was against the initiative. The overall comments actually reflected the amount to pay, as state the following examples:
“I’m single and then 1000 euros is not enough if the surcharges are gone” (single mother)
“I totally agree (…) The basic income. 1000 or even 1500 € is insufficient at the current level of all fixed charges.”
“Scandalous to those who have served for more than 35 years with a boss and after almost 1000 job applications do not get started. He does voluntary work of sometimes more than 40 hours a week. We will be milked out…. If this continues, many people do not see the meaning of their life again and then wonder how they are. Government, shame on you!!”.
“I agree … I have signed because it’s a start, but 1000 € (…) absolutely not feasible to get around and certainly not when all surcharges disappear (…) When determining amounts, we must remain realistic. The witch hunt for compulsory job application must also be on the slope and quickly as well”.
The documentary video can me watched at the following link (in Dutch).
More information at:
[in Dutch]
Radar, “Petitie basisinkomen 55-plussers al ruim 50.000 keer ondertekend [Basic Income petition for people over 55 years old was signed more than 50000 times]”, Radar, June 2nd 2017
