by Kate McFarland | Aug 9, 2016 | News
Labour Party leader Jeremy Corbyn stated in a recent HuffPost interview that he is “instinctively looking at” a basic income, along with Labour’s Shadow Chancellor John McDonnell.
Jeremy Corbyn, the Leader of Britain’s Labour Party, was recently asked about universal basic income (among other topics) in an interview with HuffPostUK. Corbyn replied that he and Shadow Chancellor John McDonnell are “instinctively looking at” the policy.
Here is the remainder of his answer:
I am looking forward to discussing it with our colleagues from Norway because we have to think radically about how we bring about a more just and more equal society in Britain, how we develop policies that achieve that.
Because what we are doing is heading in absolutely the wrong direction with a growing wealth inequality and an opportunity inequality for communities, as well as poorer families. It’s got to change and it will.
I can see the headline attraction to it. I don’t want to commit to it until I’ve had a chance to look at it very seriously and very carefully because this would be a major, major change in social policy and it’s something I would invite the whole party and the whole movement to have a serious discussion about.
What I want to do is develop policymaking through to 2020, where it’s very obvious what the general direction is we are going, on environmental policy, on housing policy, and health policy.
Corbyn was soon shown right about the “headline attraction” of basic income. Immediately following the interview, HuffPostUK editor Paul Waugh published an accompanying article with the headline “Jeremy Corbyn Looking At ‘Universal Basic Income'” And, on the next day, an article appeared in The Independent with the title “Universal Basic Income: Jeremy Corbyn considering backing radical reforms”.
John McDonnell has been a supporter of basic income prior to his appointment as Shadow Chancellor in September 2015. Earlier in this year, he encouraged the Labour Party to consider adopting UBI as official party policy on several occasions, most notably at events in February and June. To date, however, the Labour Party has not made basic income part of its platform.
Following Brexit, the Labour Party reached over 500,000 members, its highest number in decades.
More Information
Full interview with Jeremy Corbyn, which also touches upon housing policy and other issues:
Paul Waugh, “Jeremy Corbyn Interview: On Owen Smith, Trident, Brexit, The Housing Crisis And A ‘Universal Basic Income’“, HuffingtonPost UK; August 6, 2016.
Subsequent press concerning Corbyn’s remarks about UBI:
Paul Waugh, “Jeremy Corbyn Looking At ‘Universal Basic Income’; Says House Price Fall Could Help Tackle Housing Crisis“, HuffingtonPost UK; August 6, 2016.
Siobhan Fenton, “Universal Basic Income: Jeremy Corbyn considering backing radical reforms“, The Independent; August 7, 2016.
Background about the British Labour Party’s recent interest in UBI:
Kate McFarland, “UNITED KINGDOM: Labour Party to look into Basic Income”, Basic Income News; June 6, 2016.
Toru Yamamori, “United Kingdom: Labour Party considers universal basic income”, Basic Income News; February 21, 2016.
“Basic Fact Checking”
In his HuffPostUK articles, Paul Waugh states, “The universal basic income idea has been around since the 1970s but has recently become popular and Canada’s Ontario and Norway are both starting pilot schemes.” Two brief remarks:
1. Out of Scandinavian nations, Finland is much more advanced than Norway in planning a basic income experiment, with one set to begin in 2017. While Norway has held conferences to discuss the idea of a basic income, it has not announced any plans for a pilot study.
2. It’s true that the “universal basic income idea has been around since the 1970s” — but perhaps notable that the idea (and even the term ‘basic income’) has been around longer.
Jeremy Corbyn photo CC by ND 2.0 70023venus2009
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by Kate McFarland | Aug 7, 2016 | News
Last week, a group of 35 economists signed a letter demanding that the Treasury and Bank of England consider new policies to stimulate growth, including direct cash transfers to citizens.
On Thursday, August 4, the Bank of England announced that it would cut interest rates for the first time since 2009. This measure is intended to promote spending, and the bank believes that a recession can be averted. Nonetheless, Bank of England Governor Mark Carney warned that an economic slowdown remains inevitable in the wake of Brexit. For those British businesses who are trying to fight through this, they may be looking at ways they can support their business such as looking into merchant accounts from Unicorn Payment to assist with online payments. Anything that can aid in British businesses finding their feet after Brexit is important.
Although many economists expected the bank to make this decision, some lobbied against it — arguing that, after seven years, the lowering of interest rates has proven unsuccessful in boosting the British economy. On August 3, the day before the bank’s decision, The Guardian published a letter signed by 35 economists, directed to Chancellor of the Exchequer Philip Hammond.
The letter called upon the Treasury and Bank to adopt policies that will stimulate spending directly, and it posed several suggestions to this end:
A fiscal stimulus financed by central bank money creation could be used to fund essential investment in infrastructure projects – boosting the incomes of businesses and households, and increasing the public sector’s productive assets in the process. Alternatively, the money could be used to fund either a tax cut or direct cash transfers to households, resulting in an immediate increase of household disposable incomes. Furthermore, competitive business energy prices for UK companies could also boost production and the economy as a result.
In any of these policy scenarios, new money will be directly introduced into the real economy, stimulating aggregate demand and boosting employment, investment and spending. While it is a job for the Treasury to set up the framework for these policies to be deployed, it would remain a decision for the monetary policy committee as to the timing and size of any future stimulus.
Signatories include BIEN co-founder and co-president Guy Standing, anthropologist David Graeber (a vocal advocate of basic income), Keynes biographer Lord Robert Skidelsky (who has also written in support of basic income), Mark Blyth and Eric Lonergan (who have previously written in support of direct cash transfers), and Steve Keen (who coined the phrase ‘quantitative easing for the people’).
Many of the economists were also signers on a similar letter to European Central Bank (ECB) written last year, which encouraged the ECB to consider policy alternatives to quantitative easing — the policy of printing new money to purchase bonds from financial institutions. This letter had recommended that the ECB use its money to stimulate spending directly, such as by simply giving the money to citizens.
Although Wednesday’s letter to Hammond did not impact British monetary policy (yet), it did generate publicity about the economic benefits of one of the central features of a basic income: the direct transfer of cash to consumers. Subsequent articles in The Guardian, by Larry Elliott and Simon Jenkins, stressed the benefit of cash transfers in boosting spending. (As Jenkins concludes, “There could be a ‘spending Olympics’. There could be vouchers, scrappage schemes, Christmas bonuses and, horror of horrors, cash for the undeserving poor. Why not try it? All else has failed.”)
Similarly, writing in The Independent about the projected effects of Bank of England’s interest rate cut, Ben Chu raises the question “Why doesn’t the Bank just print money and give it to people and firms to spend directly?” Referring to Wednesday’s letter, Chu points out that “a growing number of academic economists are arguing that this would be a more effective, and less financially distortionary, way of stimulating the economy.”
References
“A post-Brexit economic policy reset for the UK is essential“, The Guardian; August 3, 2016.
Larry Elliott, “Cash handouts are best way to boost British growth, say economists“, The Guardian; August 4, 2016.
Simon Jenkins, “Want to avoid recession? Then shower UK households with cash“, The Guardian; August 5, 2016.
Ben Chu, “Interest rate cut: What did the Bank of England announce today and how will it affect you?” The Independent; August 5, 2016.
Photo of Bank of England CC Diliff
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by Kate McFarland | Aug 4, 2016 | News
Writing in Union Solidarity International, Gary Herman recommends that unions add universal basic income to their list of demands.
The basic income is a response to increasing job insecurity and the spread of various forms of on-demand employment, from conventional freelancing to zero-hours contracts. Its supporters argue that unions wishing to fight for a fairer economic settlement should adopt BI as a key demand, although there is certainly evidence of ambivalence towards it within the union movement.
In making the case for unions to promote a basic income, Herman draws from the work of economist (and BIEN cofounder) Guy Standing and sociologist Erik Olin Wright.
Read the article here:
Gary Herman, “The New Unionism—Part 1: Precarity, Work and the Basic Income,” Union Solidarity International, May 18, 2016.
Photo CC Raymond “Dmitri” Beljan (flickr)
by Kate McFarland | Aug 3, 2016 | News
As Director of Policy and Strategy at the UK’s Royal Society of Arts (RSA), Anthony Painter has been instrumental in researching and promoting universal basic income, coauthoring an important report on the topic that was published last December.
On June 11, 2016, Painter took part in a TEDx event in Birmingham. The video of his talk is now available online.
We need a platform, but we’ve built a cage. The platform we need is a wedge of freedom, a foundation of security, a support for people to care for their families, their communities, to try new things, to unleash their creativity, maybe try a new business, to get to qualifications, to learn new things. … The platform we need is a universal basic income.
Watch the video here:
Anthony Painter, “We need a platform, but we’ve built a cage,” TEDxBrum; uploaded July 5, 2016.
Photo CC Evan Long (flickr)
by Kate McFarland | Aug 2, 2016 | News
The noted economist Mariana Mazzucato (University of Sussex) delivered the 2016 Raul Prebisch Lecture at the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) in Santiago, Chile.
During the Q&A session, Marion Kappeyne van de Coppello, the Dutch Ambassador in Chile asked Mazzucato to elaborate on the “innovative new concept” of basic income for everyone.
In reply, Mazzucato spoke very favorably of the idea of basic income — going so far as to call it a “basic right” that should be “taken for granted”. However, she cautioned supporters of basic income not to think only in terms of redistribution. Instead, she called upon progressives to think more about value creation and conceptualize basic income as a type of pre-distribution.
Mazzucato described basic income as a “way to enable everyone to create value in the first place (which then of course has to be redistributed through progressive taxation)” — and tied the idea to Amartya Sen’s work on capabilities, which are required for people to pursue opportunities.
Earlier in the year, ECLAC encouraged its member states to investigate the possibility of basic income.
Mazzucato’s entire lecture is available on YouTube:
Comisión Económica para América Latina y el Caribe (CEPAL), “Mariana Mazzucato dicta Cátedra Prebisch en la CEPAL,” YouTube; published on April 19, 2016.
Photo of Mariana Mazzucato CC Mark Blevis
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