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Category: THE BASICS OF UBI

  • The UN has asked Sri Lanka to introduce a temporary basic income

    By: Benjamin Parkin

    Original post can be found here.

    The UN has asked Sri Lanka to introduce a temporary basic income and negotiate “debt-for-nature” swaps tied to environmental conservation as part of measures to mitigate the country’s economic meltdown, as Colombo begins talks with the IMF.

    The UN Development Programme made the proposals in a document seen by the Financial Times that was submitted to President Gotabaya Rajapaksa’s government and that will be reviewed by the cabinet that was sworn in this week. Sri Lanka’s lack of foreign exchange has left the debt-laden island of 22mn unable to repay its loans, triggering an economic and political crisis with mass protests over shortages of food, fuel and medicine.

    Rajapaksa has faced sustained calls to resign. The government, which has about $8bn of debt and interest due this year on usable foreign reserves estimated as low as a few hundred million dollars, has suspended bond payments and begun negotiations for an IMF bailout. A Sri Lankan government delegation travelled to Washington this week to begin talks with the fund over an assistance package expected to include debt restructuring.

    The UNDP argues that Sri Lanka, which owes about $45bn in long-term debt to creditors that include international bondholders and countries such as India and China, needs immediate financial assistance while the IMF talks are under way. The UN body has asked Sri Lanka to pursue swaps and short-term financing from countries including India, China and Bangladesh to alleviate economic pain ahead of IMF assistance.

    “The IMF package, if it comes in, that is going to be an austerity package,” Kanni Wignaraja, the UNDP’s Asia director, told the FT. “So the government will have to, and they are considering very much, supporting the most vulnerable households with an immediate social protection flow.”

    Among the UNDP’s requests is that Rajapaksa’s government introduce a temporary basic income, which would take the form of an unconditional cash transfer to working-age Sri Lankans for a period of about six to nine months.

    Similar programmes have been implemented in Kenya and the US state of Alaska. “It’s something that has been tried and tested,” Wignaraja said. “There’s obviously a cost to bear, but it has been found to be more efficient than some of these very heavy social protection measures.” The agency has also asked Sri Lanka to pursue bonds or debt swaps linked to environmental and social sustainability, such as debt-for-nature deals in which some loans are forgiven in exchange for investment in environmental conservation. Similar measures have been introduced in countries such as Costa Rica, and Wignaraja argued that Sri Lanka — famed for its beaches, forests and mountains — was well-placed to tap such schemes.

    We’re “moving quite aggressively to see if dwindling foreign exchange reserves left the import-dependent island with shortages and severe inflation. Food and fuel prices have doubled while the currency has fallen 60 per cent since it was floated last month.

    Rajapaksa’s government had for months resisted international calls to restructure or approach the IMF before a U-turn last month triggered by widespread protests followed by the resignation of his cabinet. A protester was killed after police opened fire on crowds in the town of Rambukkana on Tuesday.

    The post The UN has asked Sri Lanka to introduce a temporary basic income appeared first on Basic Income Today.

    This post was originally published on Basic Income Today.

  • What would a basic income mean for the Arab world?

    By: Diana Bashur

    See original post here.

    _______________________________________

    In a nutshell.

    • What a regular, individual and predictable basic income has done is make people more engaged in productive activities, start own-account work and carry out small productive investments such as purchase of cattle and sewing machines.
    • A key opportunity is to restructure peace-building programmes to include a basic income for countries coming out of conflict, ensuring that reconstruction funds reach those most often side-lined in traditional post-conflict situations.
    • While policy-makers are often reluctant to trust the poor with unconditional cash, it has been consistently shown that the most vulnerable are in fact best placed to know where their priorities lie and spend accordingly.

    _______________________________________

    The idea of a regular, unconditional and individual cash payment distributed to all citizens is gaining ground. This column argues that such a basic income would ensure that everyone is able to meet their basic needs unconditionally, thereby improving people’s resilience and solidifying communities. Ultimately, a basic income could help to rebuild the social contract in the Arab world where governments would uphold human dignity by awarding citizens economic security as a right.

    The policy tool called basic income – a regular, unconditional and individual cash payment distributed to all – has gained significant attention globally. The main driver is its potential to mitigate social and economic inequalities (Standing, 2020), which have been made only more visible through Covid-19 (Wignaraja and Horvath, 2020). There have been over 20 basic income pilots around the world, with particularly transformational results in trials in India (Davala et al, 2015) and Namibia (Haarmann et al, 2009).

    Let’s contemplate what a basic income would mean for the citizens of Egypt, Iraq, Lebanon, Morocco, Syria and the rest of the Arab world.

    A monthly unconditional cash allowance would ensure basic economic security to recipients. Its predictability would decrease people’s stress levels in seeking to meet their needs. Citizens’ mental bandwidth could then expand beyond their immediate necessities.

    A sense of dignity is restored as basic income is awarded as a right and is non-withdrawable. Rather than mere supplicants for welfare, people are thus treated as the adults they are. With their basic needs met, citizens are empowered to contemplate different productive activities in which to engage, ones that they are eager to sustain to contribute to their communities. With better prospects for the future, a sense of expanded trust towards others is then possible. This will strengthen overall resilience.

    Some deem basic income a controversial policy tool because it essentially allocates a regular sum of cash without any behavioural conditions or considerations of poverty levels. But it is worth noting that the current economic system already awards considerable amounts of cash in exchange for ‘nothing’.

    Think about wealth inheritance, exorbitant tax breaks to affluent companies or tax avoidance by the rich who use public services free of charge (Standing, 2017). If we accept these forms of wealth transfers and exemptions in exchange for what essentially is nothing particularly productive, a basic income may represent a form of reparation to equalise the playing field for those without access to such wealth transfers.

    Others argue that a basic income will encourage laziness, idleness and the consumption of illicit goods. But no such behaviour has been evidenced in trials of basic income nor of the more traditional forms of cash transfers common in humanitarian and development settings (Bastagli et al, 2016; Evans and Popova, 2014).

    Indeed, as shown in the basic income pilot in India, if anything, beneficiaries of unconditional cash work more and sit less, as they have less free time on their hands.

    What a regular, individual and predictable basic income has done is make people more engaged in productive activities, start own-account work and carry out small productive investments such as purchase of cattle and sewing machines.

    Being awarded universally in the community where it has been tested, a basic income encourages common decision-making and solidarity (Davala et al, 2017). Reasons for this transformational impact rest in individual economic security and the empowerment it ensures.

    How could such a policy tool be funded? One suggestion is to include a basic income in the development toolbox of international organisations (Bashur, 2022).

    Specifically, a key opportunity is to restructure peace-building programmes to include a basic income for countries coming out of conflict. This would ensure that rather than channelling reconstruction funds through the private sector as was done in Lebanon and Iraq (Abboud, 2014), at least some funds reach those most often side-lined in traditional post-conflict reconstruction programmes. Failing to address the livelihoods and resilience of the most vulnerable would only entrench inequalities and deepen social fragmentation.

    Other forms of funding include restructuring extensive subsidies on fossil fuel products (Standing, 2017), which take up large sums of public expenditure across the countries of the Middle East. Subsidised goods such as fuel and electricity are most often regressive in nature, meaning that they benefit those who consume more. The recent decision in Lebanon to lift subsidies goes in the right direction. But savings from reducing subsidies should be distributed directly to individuals by way of a basic income.

    Beyond funding considerations, what is the main hurdle for implementing such a policy? What is essentially at stake is a question of trust: policy-makers are reluctant to trust the poor with unconditional cash for fear that they will squander it, spending it on unproductive endeavours and essentially wasting it.

    But it has been consistently shown that the most vulnerable are in fact best placed to know where their priorities lie and spend accordingly. For this, supporting the introduction of a basic income would be a real test to the ultimate aims of entities funding colossal aid programmes designed to advance a country’s development.

    Importantly, what a basic income could mean for the Arab world is extracting the all-too-pervasive footprint of donors and their embassies in countries’ internal affairs. Rather than foreign capitals, governments’ strongest backers are inevitably their citizens – as long as they treat them with respect and uphold their dignity.

    This reality is how states function, yet it somehow seems to escape governments of the Middle East. A basic income could help to mend this broken social contract.

    The post What would a basic income mean for the Arab world? appeared first on Basic Income Today.

    This post was originally published on Basic Income Today.

  • Long-lost leaflet reveals radical 1986 plan for a basic income for all in the UK

    Named after a quote from Karl Marx, a leaflet picked up in a second-hand bookshop uncovers an ambitious proposal backed by Sheffield City Council and both universities.

    By: Sam Gregory.

    Original Post: https://nowthenmagazine.com/articles/long-lost-leaflet-reveals-sheffields-radical-1986-plan-for-a-basic-income-for-all

    A leaflet unearthed in a Kelham Island bookshop has revealed a long-lost proposal backed by Sheffield City Council for a Universal Basic Income (UBI).

    Written in 1986, the plan calls for a “guaranteed minimum income” for every citizen, replacing large parts of the means-tested benefits system and paid for through higher taxes on the rich.

    ‘To Each According… A Living Income For All’ is named after a famous quote by Karl Marx, reflecting the febrile political atmosphere in the so-called Socialist Republic of South Yorkshire at the time.”

    When I picked this booklet up, I was amazed to see that back in the eighties the council had written such a forward-thinking policy paper,” said Minesh Parekh, a Labour council candidate who found the leaflet in Kelham Island Books and Music.

    “It sets out a need for a radical redistribution of wealth, and explains how giving everyone a liveable income and having maximum rent prices would tackle poverty and inequality.”

    Ubi cartoon 2
    A cartoon in the leaflet

    Universal Basic Income – called a ‘Guaranteed Minimum Income’ in the document – is a regular payment given automatically to all citizens regardless of income, wealth or work.

    As well as different departments of the council, the working group who put the 1986 proposal together included the University, the Polytechnic (now Hallam University) and dozens of voluntary groups across the city.

    Ubi cartoon 2
    A cartoon in the leaflet

    Their plan calls for UBI to replace a host of means-tested benefits from the Thatcher era that have since been scrapped, including Invalidity Benefit and the Family Income Supplement.

    The group also advocate extra payments for people with children and those with higher costs relating to disability.

    “This is a very radical proposal as it challenges the link between income and wages,” say the document’s authors, anticipating criticism that is levelled against UBI proposals to this day.

    “But we believe that because it points towards income equality it should be in the forefront of all our thinking about benefits and income distribution. It is the yardstick by which any interim reforms should be measured.”

    The statement stands in stark contrast to the Thatcher government’s policies at the time, which saw the benefits system and other public services cut while inequality soared.

    “This is a very radical proposal as it challenges the link between income and wages”

    The leaflet includes a number of satirical cartoons. One features a funfair-style “means-test machine”, while another imagines the infamous DHSS (Department of Health and Social Security) administering UBI payments instead, rechristening it “the Department of Heavenly Simple Systems”.

    Ubi cartoon 4
    A cartoon from the leaflet

    A sketch shows a same-sex couple holding hands in November 2001 – 15 years after the leaflet was published – wondering why a means-tested benefits system was “still being inflicted on people” as late as the 1980s.

    In 1986 Sheffield was a hotbed of radical politics under the leadership of future Home Secretary David Blunkett, with the council flying the red flag from the Town Hall on May Day and opening The Anvil, a publicly-owned arthouse cinema.

    Bus fares were reduced to 10p – the lowest in the country – and local leaders had hoped to scrap them entirely before buses were deregulated by the government in 1986.

    Lord Blunkett told Now Then that the leaflet “took him back”, adding that the principles for a new welfare system outlined by the working group were “still totally relevant today”.

    “Later, when Gordon Brown introduced the tax credit system, a substantial part of the objective was achieved – albeit temporarily,” he said.

    “I have become convinced that complete ‘universality’ is not achievable, as there is great resistance – as illustrated six years later in the 1992 general election – to cash transfers which involve money being moved about by government not to met a specific need, but simply to equalise basic income.”

    In 1992 the newly-formed Liberal Democrats fought their first election promising to introduce a ‘Citizen’s Income’ of £12.50 a week for working-age adults – and lost two seats compared to their predecessor parties.

    Blunkett added that it was “pleasing to know that campaigners in Sheffield were way ahead of the game, and sad to reflect that we are still fighting the same battles almost 40 years later”.

    In recent years Sheffield has again been at the forefront of the movement for a Universal Basic Income. In 2019 the council passed a motion calling for a pilot in the city, becoming the second in the country to do so.

    Ubi cartoon 3
    A cartoon from leaflet

    It’s also the birthplace of the UBI Lab Network, a grassroots movement which explores the potential of basic income around the world (like Now Then, UBI Lab Network is an Opus Independents project).

    On 22 April a free online event at Sheffield’s Festival of Debate will look at how calls to pilot UBI have gained momentum in Wales and Northern Ireland in recent years.

    “Clearly, Sheffield has long been a place to ferment and offer radical solutions to society’s problems,” Parekh told Now Then.

    “I think we should consider learning from the past and taking a similar approach to the pamphlet. Rather than tinker around the edges, councils should offer systematic solutions to societal problems.”

    The post Long-lost leaflet reveals radical 1986 plan for a basic income for all in the UK appeared first on Basic Income Today.

    This post was originally published on Basic Income Today.

  • The pandemic exposed a clear feminist argument in favor of universal basic income

    Two years on from the first national coronavirus lockdown, Hannah Fearn examines the impact the pandemic had on mothers and argues that we can no longer allow those who care for others as their primary occupation to be written off

    By: Hannah Fearn 

    Original Post: https://www.independent.co.uk/life-style/women/the-pandemic-exposed-a-clear-feminist-argument-in-favour-of-universal-basic-income-b2041320.html?utm_content=Echobox&utm_medium=Social&utm_campaign=Main&utm_source=Twitter#Echobox=1648034478

    As a mother, whatever you plan, for yourself and for your financial security, it comes second to the protection of your child. Work comes second to sickness, socialising comes second when childcare is cancelled, sleep comes second to comforting a colicky baby. This is the lot of motherhood.

    This sorry story, to be repeated ad nauseum throughout the intensive early years of parenting, is familiar to anyone who has brought up or supported a child. What has been too infrequently discussed until the last couple of years is how damaging the rollercoaster of early life is to women’s chances at work. Childcare costs, the mental load, the sharing of domestic responsibility, yes – but what happens when everything a family has put in place to support work outside the home collapses, and who bears that burden most acutely, still went unsaid.

    Then, the pandemic.

    The ultimate sudden collapse of lifelines had happened – no school, no nursery, even nannies unable to go to work, and widespread ill health – and women simply picked it up and carried on.

    Globally, new research published this month demonstrated while the physical disease Covid-19 hit men harder, women bore the brunt of it economically and socially.

    Around the world more than a quarter of women (26 per cent) reported a loss of work during this period, compared to 20 per cent of men. Women and girls were more likely to drop out of school and education, more likely to experience gender-based violence during this time, and more likely to end up putting aside their own desires or needs to care for someone else. Around the world, the rate of women leaving the workforce to dedicate themselves to care needs rose by 10 per cent.

    The same study of women’s life chances also found that more than half of respondents reported an increase in unpaid labour over the course of the pandemic. The only places it didn’t rise were in North Africa and the Middle East where, arguably, there was already the most work to do to align the economic opportunities of men and women.

    Even in the relatively privileged west, where many women were able to work from home, holding on to paid employment even as they struggled to juggle it with educating their children at home and other domestic demands, the pandemic still saw women’s economic opportunities shrink as the stresses piled on.

    In the UK, a pattern seemed to establish itself in many family households headed by two parents. Fathers squirrelled themselves away in a home office or bedroom, concentrating on keeping a stable income while women attempted to take on an unfathomable task: childcare, domestic work, home schooling, feeding a family three times a day (plus the endless, limitless provision of snacks). Some requested furlough in order to cope. Others attempted to continue to work, but accepted that their work would be poor quality, rushed, achieved within the margins of family life. They gave up any chance of promotion and simply accepted their limitations. The result? A crushing of opportunity.

    “Has my mental and physical health suffered? Yes, of course, it’s torn to shreds”

    One woman, who I will call Sarah, told me her story. She had taken on a major project at work in March 2020, and her husband also had a promotion. Suddenly she was faced with home-schooling a nine-year-old who was also struggling with his mental health in isolation. “All the while this was going on, my other half was working – glued to his desk or resting in bed. Locked away in the loft room. Barely coming out until the evening,” she explains. “And I was juggling all of this. I wanted to have a breakdown, but there is no way I could have done that. I was propping and am propping everything around me up. Has my mental and physical health suffered? Yes, of course, it’s torn to shreds.”

    She describes her career as having “taken a backseat” at this time. “There is no way I could have prioritised it during all of this. There is so much other stuff that I need to keep an eye on. And I think this is the crux of it: as women, we can see more than what’s right in front of us. We can see the suffering and stress, and we aren’t able to disengage from it.”

    It’s a pattern Sarah has seen repeated throughout her friendship groups, including one who works full time as a university lecturer. “Her husband also has a full-time job and worked from the garden office throughout the lockdown. Her office was next to her then nine-year-old daughter’s room. Obviously, if her daughter needed help with anything, it was my friend she came to. There was no point during the day that she was actually able to turn her attention to her job full time. She was needed 24/7 – whether she was on a call or not.”

    A disappointing trope that appears on female-dominated internet discussion boards is to blame women for creating their own economic dependence on a male partner, to criticise them for allowing situations to develop where a man can free himself from domestic drudgery and the relentless cycle of wiping noses and kitchen floors, while a woman is expected to cover all that work – it is work, of course, endless and exhausting work – as well as maintain her career outside the home. That’s almost impossible, but it doesn’t stop women all over the country making themselves mentally ill trying to prove it isn’t. Meanwhile those who sensibly step back are then criticised for putting themselves in a financially precarious position.

    The reality is that stepping back from paid employment often makes most financial social sense, in the short term at least. When families face economic pressures, the parent with the most secure income must prioritise work, while the mental load of, well, absolutely everything else, is passed to the other parent. With the gender pay gap in the UK sitting at 7.9 per cent for full time employees (up from 7 per cent in just one year), women who earn less are more likely to become the default parent.

    It’s an obvious point to make, but the pandemic hasn’t created these inequalities, it has merely exposed them to a cleansing light.

    Now new data from King’s College London and Ipsos Mori shows how the post-covid era is shaping up for women: one in five Britons say childcare or other caring responsibilities have prevented them applying for a new job or promotion or have caused them to consider leaving a job. Women are twice as likely as men (26 per cent, compared to 13 per cent) to say this has been the case for them.

    Experts in society and health are now openly commenting on the ways in which the last two years have embedded these existing inequalities into global societies, such as Rosemary Morgan of John Hopkins Bloomberg School of Public Health, who said: “The further we progress in this pandemic the more we feel that the inequities being exacerbated are only going to worsen, and that any pre-pandemic progress towards gender equality will be reversed.”

    Perhaps surprisingly, two years of successive lockdowns and the extreme visibility of the drudgery of domesticity during covid may have done women a favour. Of course, they have suffered the most economically during this time, but now their economic peril is under discussion. It’s illuminated and cannot go on being ignored, much though some might prefer.

    There is an opportunity for change. We can see the work, and we can see who is doing it. It can no longer go unremunerated.

    Anecdotal though this observation is, it’s interesting that in the push to return to the office, the biggest critics of a hybrid working life, split between home and the office, appear to be middle-aged men. Wouldn’t the easiest thing, for those who are not the “primary parent”, be to just put the jack back in the box? To scuttle back onto the commute and look away again, to pretend that the workload, the care work, the physical work, just isn’t there? To pretend that women aren’t undertaking hundreds of thousands of hours of unpaid labour without recognition?

    Well, too late. The pandemic has exposed where the fractures in our patriarchy economic system are opening up, and now there is an opportunity for change. We can see the work, and we can see who is doing it. It can no longer go unremunerated.

    Since the 2008 financial crash and the squeeze on welfare states that followed, particularly in the UK and the US, an argument has been building for the introduction of a universal basic income, in which paid work is taxed more highly but every citizen receives a basic stipend to recognise their contribution to the economy and the fruits of their unpaid labour. There are numerous projects, across cities and nations, exploring how this might work, and endless ways to structure the benefit.

    But one thing is now clear: the pandemic has exposed a clear feminist argument in favour of universal basic income. While the work they are doing to keep families and communities stable goes unrecognised and unpaid, women’s economic chances are stymied. We can no longer allow those who care for others as their primary occupation – male or female – be written off as lazy or workshy. Household budgets can no longer write off domestic work dead time.

    The nation’s economic stability is so precarious, it relies on the unrecognised and unpaid labour of (primarily) women. Feminists have been making this argument for generations, but now we’ve seen what happens when you collapse society into lockdown. Work has changed, family life has changed, the workforce is being casualised, we live differently. Now is the time to think differently about how the economics of family life are reflected in government policy.

    If Rishi Sunak can design and administer a furlough scheme in extremis, then sufficient thinking can now go into a form of UBI that promises to undo the economic damage that covid has done to women’s lives and create a future that respects and rewards the burden of the no longer invisible workload they have been carrying.

    The post The pandemic exposed a clear feminist argument in favor of universal basic income appeared first on Basic Income Today.

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  • A gradual path to a fully universal unconditional basic income is possible in Brazil

    By: DAVID CASASSAS, JULIE WARK, AND JEAN WYLLYS …

    Original Post: https://www.counterpunch.org/2022/02/25/brazil-amazon-world-about-a-universal-basic-income/

    “If the misery of the poor be caused not by the laws of nature, but by our institutions, great is our sin.”

    – Charles Darwin

    Scientists, doctors, environmentalists, and others who know what they’re talking about, are saying that planet Earth is in such dire straits that the global economic system must change. And urgently. But paralysis tends to set in. Yet it’s not impossible. An unconditional, universal basic income is an achievable practical answer that would establish a solid basis for change. Moreover, after the nightmare of Bolsonaro’s cruel, destructive, democracy-trashing mandate, a new antifascist government in Brazil after the October elections could lead the way for the whole world, showing that it can be done.

    How to contribute, from here in the south of Europe, to the debate about basic income in Brazil? With the pandemic and the global climate crisis making it clearer than ever before that this planet desperately needs an end to the depredations of capitalism and a new socioeconomic system that respects nature in all its animal, vegetable, and mineral forms, we believe we should share all we’ve learned about this revolutionary measure that—by definition at least—would abolish poverty since it is universal, unconditional, and of an amount above the poverty line.

    In other words, it guarantees the most basic human right of all, the foundation on which all other rights rest: the right to material and social existence. A universal basic income wouldn’t only abolish poverty but also acceptance of poverty as a capitalist mainstay, the result of humans exploiting, instead of caring for and about, other humans.

    Brazil is perhaps the country that offers most hope that a start could be made here, not least because of its long history of trying to introduce a universal basic income. It’s the only country in the world to have passed a Basic Income law (2004, in Lula’s first mandate). Yet the law remained a dead letter, unknown to most of the population, and hence not understood as enshrining a right. Nevertheless, it did give rise to the means tested Bolsa Família covering some 14.3 million families (47 million people, almost 25% of the population) until the Bolsonaro government abolished it in December 2021. It was replaced with an emergency programme which, as a temporary handout and not a right, consists of just four means-tested payments of R$600 ($116,75), one per month, to some 54 million people including previous recipients of the Bolsa Família programme, precarious workers, and unemployed (but not Indigenous and Black communities, the hardest hit by the pandemic). Now that the polls are showing that Lula could win outright in the first round of the election in October this year, associations, movements economists, philosophers, social scientists, and all state governors—are calling for implementation of Law 10.835/2004 on basic income.

    So, here are some thoughts on the matter, starting with three main assumptions, which could apply to basic income projects around the world. They automatically constitute a radical break with the dog-eat-dog practices of the neoliberal system.

    I

    1) In the critical situation we’re faced with this century, societies should uncouple access to income (and other resources) from access to employment. Access to income and other resources should be universal, open to everyone without exception, as happens with universal public health systems where they exist, and unconditional (i.e., not dependent on the circumstances of people’s existence). The basic income would be a pillar of this project and, by its very existence, would proclaim that human lives aren’t for sale, that everyone has the right to live in decent conditions.

    2) There is still resistance to the idea and practice of basic income, mainly from the right but also from sectors of the working class that balk at the concepts of universality and unconditionality out of fear, encouraged by a good part of the media, that unconditional access to resources would mean that people couldn’t and wouldn’t work (the so-called labour bias). This makes it difficult to write about basic income possibilities. Though we are convinced by the ethical and political sense of unconditionality and universality (basic income as a human right), we understand that it may not yet be possible, or even conceivable as a campaign priority for the left in Brazil. Hence, “intermediate stages” should at least be considered, though the labour bias must be energetically refuted.

    In technical and normative terms conditionality is much less desirable than unconditionality and universality. Yet, news from Brazil suggests how difficult it is for progressives, in the absence of a broad sociocultural consensus about unconditionality, to take such an enormous step right now when the priority is to defeat present neo-fascist barbarism, and negotiation with conservative (but not ultra-right forces) is all important as a strategy for ousting Bolsonaro. And the question of non-extractivist financing of a basic income, basically by taxing the rich, is another obstacle to be overcome. A victory for Lula and a new democratising programme might show the way towards a full basic income via partial and temporary stages. It’s not ideal, but the political reality must be faced. Given the urgent need for an anti-fascist victory in October, one workable approach could be to produce and publicise a clear programme (as a campaign platform) of introducing partial measures by segments which would, in practice, make the politico-economic logic of basic income more understandable, especially regarding unconditionality as a culture of rights. It would also need to show that, far from being a disincentive, the measure actually promotes work, the many kinds of socially necessary work that would benefit everyone rather than a few rich exploiters.

    3) A basic income would do away with the logic and institutions of twentieth-century social consensus that have proven so damaging. The labour market can’t guarantee material security for everyone. The percentages of unemployed, excluded, and precarious populations have rocketed to extremes that were unthinkable a few decades ago. Moreover, those who’ve managed to get a foothold in the labour market have no guarantees of escaping from poverty. In Brazil, almost 20% of workers come under the heading of “working poor”. Social consensus can’t be achieved in job markets that exclude so many and that are so destructive of the freedom and dignity of the “lucky” workers who are employed. So, an urgent priority is to make known and strengthen, by means of an income policy, the many other settings in which people can work, paid or unpaid, and where a decent physical and social life is the main concern.

    The government of Brazil could establish, protect, and promote social milieus and forms of economic life that would favour human dignity, emancipation from historic bonds of social subjugation, the eco-social transition, and due recognition of tasks that are essential for the reproduction of social life, and so on. With the following list of measures that would be compatible with these aims, we accept that conditionality could be necessary, though we stress that it undermines the concept of rights and brings many practical and administrative problems. Nevertheless, conditional programmes can pave the way towards a broader understanding of work and socioeconomic empowerment, if and only if the political will and the cultural and political conditions (in other words, the appropriate political and cultural hegemony) exist to make it possible because, otherwise, conditionality can end up becoming entrenched. The ideal, in this case would be to create an effective set of forces which, formed around a robust idea of freedom in the domain of work, could end up leading to a fully universal, unconditional basic income.

    II

    Here is our list of conditional possibilities:

    1) Cash benefits for people working in productive projects of the social, cultural, and solidarity economy (cooperativism, for example). There’s no point in making abstract calls for this kind of social or popular economy. People must be empowered to leave precarious jobs so they can sustain and generalise these economic practices.

    2) Cash benefits for people (mostly women) doing care work in conditions of material dependence. A “domestic counter-power” is needed so that women can have and, if necessary, impose real co-responsibility for care work.

    3) Cash benefits for women who are setting up their own business, cooperative or otherwise. In social-political terms, a good option could be prioritising projects of large networks of women that could become established in any area, thus providing a solid socioeconomic base.

    4) Cash benefits for Indigenous people so they can engage in socioeconomic forms of interaction (productive, exchange, cultural, etcetera) that would enable their social inclusion and dignified survival as ethnic groups settled in certain territories.

    5) Cash benefits for people engaged in social and economic projects for real development in community forms of production around the country, especially in rural areas, and historically overlooked (or scorned) and peripheral zones of big cities.

    6) Cash benefits for people working in social-economic projects (businesses, community, cooperative, etcetera) for the eco-social transition that Brazil, and the world, so desperately needs. One such project could be a wide-ranging, community-based project, building sustainable housing for the homeless with responsible use of materials and methods.

    7) Another possibility would be to exclude (in a temporary departure from universality) from access to cash benefits people who engage in harmful extractive activities in local and Indigenous territories and communities (for example illegal goldmining and logging). This would deter them from working for businesses that destroy the environment and social life and encourage them to look for work or forms of cooperation inside or outside the job market that would be compatible with harmonious coexistence in and with social and natural environments.

    III

    Needless to say, this scaled approach of conditional or “focalised” cash benefits entails a series of political and technical drawbacks that can’t be ignored.

    1) Major administrative costs are involved in deciding who should and shouldn’t receive the cash benefits (and constant monitoring processes involving interference in freedom and privacy). They are even greater when the benefits cover a range of activities, as outlined above. The considerable bureaucratic mess (plus tyranny, and danger of pork-barrelling) that can arise must be taken into account.

    2) The poverty trap condemns recipients of the benefits to the situations of privation and vulnerability that make them eligible in the first place.

    3) Conditional benefits involve stigmatisation of recipients of non-universal public money, singling them out as inept, failures, pitiable, and objects of contempt, among better-off citizens. On many occasions, people don’t apply for the benefits because of this kind of marginalising labelling.

    Introducing focalised benefits as listed in Section II could consolidate the logic of conditionality (thus underpinning old class structures), with all the dangers involved. It’s therefore essential to reduce conditionality as much as possible. If this gradual path is chosen, broad groups (whole local communities, internally heterogeneous social groups such as those involved in community projects, etcetera) would lessen but not totally eliminate the problems linked with conditionality. There’s a big difference between the poor person who has to go to bureaucrats to beg for “poor relief” and the one who receives help as a member of a community or social group which, for ethical-political reasons, the government decides to support so it’s no longer subject to the various historical kinds of social marginalisation (women, Indigenous groups, young jobless people, huge segments of the precariat, and so on).

    IV. 

    SHORT-TERM STRENGTHS

    With benefits like those we’ve mentioned (or others that might be applied) it’s possible to empower socioeconomically large groups that urgently need to escape from poverty and exclusion, so they can feel that they are real participants in a collective existence that makes sense.

    V. 

    MEDIUM-TERM STRENGTHS

    On this basis, ideas of what it means to be engaged in meaningful work, for which people are recognised and appreciated, and in which new social relations are created, start spreading. These are the opposite of the exploitative, biocidal kinds of logic of the neoliberal system, starting with the coercive power of its labour markets. In sociopolitical terms, it means expanding the social (and electoral?) base of people who understand that obtaining public resources is part of a legitimate and necessary attempt to ensure that each and every person can feel fully entitled to co-determine the country’s social life, especially when it’s now increasingly accepted that wealth, whatever form it takes, is and has always been a social product.

    VI. 

    LONG-TERM STRENGTHS

    Finally, by not being limited to welfare schemes “for the poor”, and by favouring the productive (and reproductive) activities of people who are willing to contribute to society with work that’s both consensual and sensible, this path towards a basic income could be spreading a truly revolutionary idea: everyone (women or not, Indigenous or not, ultra-precarised youth or not …) has all sorts of skills and the desire to use them in social contributions that are being blocked, amputated by the need to knuckle under to the impositions of formal and informal job markets. If the short- and medium-term projects are understood and consolidated, most people would end up discovering that the unconditionality of basic income doesn’t make people “stop working”. On the contrary, whatever the circumstances they’re in, they could reject jobs that are damaging to their lives (and also the soul-destroying “bullshit jobs” that David Graeber famously described), to do the kinds of work they can enjoy and feel is useful. Most people are threatened by precariousness or unemployment. They need (and have a right to) public resources that equip them to escape from this vulnerability and obtain the “social power” to engage in the kinds of work and lifestyles they choose for themselves, with the general end result of better, more just, and more efficient ways of satisfying the needs of society as a whole (including ecosystems).

    In sum, the gradual path envisages a three-phase institutional and sociopolitical process that includes (i) being aware of and responding to the present (and also electoral) emergency; (ii) creating new ways of thinking about (paid or unpaid) work; and (iii) moving towards the social goal of universality and unconditionality for a democratic socioeconomic (and ecological) existence or, in other words, towards a fully-fledged basic income.

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  • Opinion: Yes, we can afford Universal Basic Income in South Africa

    By Aliya Chikte and Gilad Isaacs

    Political will and strategic taxation channels could help bridge the yawning divide between the haves and the have nots in South Africa.

    The reinstatement by President Cyril Ramaphosa of the Covid-19 social relief of distress grant and its extension to caregivers take us one step closer to a universal basic income guarantee.

    The Covid-19 pandemic has placed the idea of a Universal Basic Income Guarantee (UBIG) back on the agenda, as can be seen from the numerous demands from civil society groups and community organisers. This recognises, in the context of a long-standing structural unemployment crisis, that poverty and inequality cannot be addressed only through expanding employment.

    However, the SRD grant of R350 per month can, at best, cover only 60% of a person’s minimum required food intake. In the short term, the SRD grant should be increased to at least R585, which is the food poverty line. This would cost an additional R17-billion until March 2022. The inadequate amount and the delays in implementing this are reflective of a government whose social policies have become reactive and crisis-driven.

    A permanent UBIG is a chance to close the gaps in South Africa’s social security net. The question is then not about whether a UBIG should be implemented, but rather how it should be designed and financed.

    To answer part of this question, the Institute for Economic Justice (IEJ) has put forward a financing policy brief for a UBIG, outlining 19 recommendations that will allow South Africa to raise funds to tackle poverty. The policy brief serves as a supplement to an earlier one on UBIG published by the IEJ in March 2021 and a summary of further research produced for the IEJ by DNA Economics. The proposals include adjustments to income taxes, consumption taxes, and wealth and property taxes; removal of corporate tax breaks; the reduction of wasteful and irregular expenditure; and the recoupment of expenditure on UBIG through existing value-added tax (VAT).

    How much and for whom?

    There are numerous suggestions for the amount at which a UBIG should be set. We present a set of options, ranging from the food poverty line of R585 per month to the initial starting level of the national minimum wage of R3,500 per month. These amounts are not, on their own, sufficient to provide a dignified standard of living, but rather seek to address the depth and severity of poverty by meeting people’s most basic needs.

    The preferred approach is one of universality, allowing all people between the age of 18 to 59, currently excluded from permanent social security benefits, to be eligible for the UBIG. In tandem, if South Africa is to reach the National Development Plan’s objective of reducing poverty to 0% by 2030, then the child support grant should also be increased to at least the level of the food poverty line.

    The universality ensures that lower-income taxpayers will benefit more from the income guarantee than they contribute in new taxes. The net benefit varies according to income brackets. For example, if a UBIG of R585 per month is provided, 84% of taxpayers will be net beneficiaries.

    How to finance this?

    The IEJ puts forward 19 tax proposals. These are options, and are not necessarily proposed as a package to be implemented simultaneously.

    Adjustments to income taxes include:

    • The implementation of a ring-fenced Social Security Tax on income, operating similarly to Unemployment Insurance Fund (UIF) contributions. This will generate R67-billion annually. It would be progressively levied upon all income earners — ranging between 1.5 to 3% of taxable personal income;
    • A resource rent tax levied on excess profits earned by extractive industries, estimated to bring in R39-billion annually. This would redistribute the gains from commodity booms while preserving incentives for investors;
    • The removal of tax breaks for high-income earners — in the form of medical aid tax credits and the pension fund contribution deduction — could contribute a total of R26-billion annually; and
    • A halt to the National Treasury’s proposed reduction in the corporate income tax rate. In the context of pressing social needs, this reduction would be deeply irresponsible

    Proposed changes to taxes on products consumed include the introduction of a VAT rate of 25% on luxury goods; a temporary increase in excise duties; and an increase in carbon taxes to one-quarter of the European Union standard. We estimate that changes to such consumption taxes will result in an additional R13-billion that can be used to finance a UBIG.

    These provide good revenue-raising options but do not tax accumulated wealth. For this reason, we propose a wealth tax. Though South Africa has one of the highest levels of wealth inequality, a wealth tax has historically been excluded from the tax framework. Using the wealth tax simulator from the World Inequality Database, we show that a 1% wealth tax for the top 1%, and a 3% wealth tax for the top 0.1% would generate R59-billion in revenue in the medium to long term. While a wealth tax is not an immediate source of financing, it is an important proposal to ensure the sustainability of a UBIG.

    It is also possible to tax the income that derives from wealth, which is also highly unequally distributed. A currency transaction tax (CTT) of 0.005%; raising the Securities Transfer Tax from 0.25 to 0.3%; and a financial transaction tax of 0.1%, would raise R3.68 billion, R1.37 billion, and R41 billion respectively. These tax the buying and selling of different financial assets and have the benefit of reducing stock market speculation.

    An increase in the estate duty tax would mean higher taxes when wealth is passed on after someone’s death. The proposal would align the tax to personal income tax rates, ensuring greater equity across the tax system. Given the skewed nature of accumulated wealth under apartheid, this seems necessary.

    This combination of taxes on wealth and income that derives from wealth would add R48-billion to government revenue.

    In addition, we propose scrapping ineffective corporate tax breaks — such as the employment tax incentive — and redoubling efforts to tackle tax evasion. The IEJ tax proposals target a 25% reduction in profit shifting of multinational corporations. Combined, this would free up a total of R18-billion in additional revenue. We also target a 30% reduction of irregular expenditure reported by the Auditor-General, freeing up R36.4-billion. A further reduction of wasteful expenditure in Cabinet and government departments would provide an additional R1.85-billion.

    Spill-over effects

    A UBIG would spur a host of positive spill-over effects in the economy, including shifting unspent funds from the wealthy and corporates to poor households, thus injecting spending into the economy that favours locally produced goods. This would also increase tax revenue as the economy grows. These all need to be investigated. One easy element to calculate is that around 12% of any expenditure on a UBIG would be recouped back by the state via VAT.

    This array of financing proposals shows that implementing a UBIG progressively and sustainably is feasible in the short term. Furthermore, some funds could be raised through additional debt, or other avenues.

    A UBIG is an important component of a broader package of social support that a capable state should ensure for all. The urgency of the moment, in addition to the longstanding persisting patterns of poverty and inequality, needs to be recognised and reflected in the debate around the implementation of a UBIG. Addressing extreme poverty is therefore not simply about financing constraints, but rather about willingness to take the immediate measures that this moment demands.

    _______________________________

    About the Authors: Aliya Chikte is a Research Associate at the Institute for Economic Justice, where Gilad Isaacs is the Director.

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  • Guaranteed Minimum Income and How It relates to UBI

    As the idea of different versions of UBI continues to gather support among the public, attention is turning to specifics at how UBI would work and how it would be financed.

    By: Mark Bryan

    As the idea of UBI continues to gather support among the public, attention is turning to specifics such as what level a UBI would be set at and how it would be financed. But alongside this discussion of design and implementation, another term is increasingly being heard: ‘Minimum Income Guarantee’ (or alternatives such as ‘Guaranteed Minimum Income’ or ‘Guaranteed Income’). For example: 


    So what is a Minimum Income Guarantee (MIG) and how does it relate to UBI?

    The distinction is not always clear from references to MIG and UBI in the media or more specialist policy literature. Sometimes the terms UBI and MIG (or similar) are used interchangeably, for instance media reports have referred to both the above-mentioned Stockton and Spanish schemes as UBI. At other times, the terms are clearly separate: the SNP manifesto distinguishes between UBI and MIG, suggesting that MIG is less ambitious and falls somewhat short of UBI. And John McDonnell has separately advocated UBI pilots and a MIG. In the US, the term Guaranteed Income (GI) is more common than MIG, but again there is disagreement about whether it means the same thing as UBI.

    What is a Minimum Income Guarantee?

    So how can we understand MIG in the current debate? To start with, it is important to realise that a MIG has long been a standard component of traditional welfare systems. In its purest form, a MIG is a scheme to ensure that nobody’s income falls below a minimum threshold: if income without the MIG is below the threshold, it is topped up. This also implies that any additional income received (under the threshold) leads to a pound-for-pound reduction in the MIG amount. As such MIG is a means-tested benefit with a 100% withdrawal (or taper) rate. 

    As will be seen, the ‘new’ MIG schemes being proposed are more complex and nuanced than this narrow definition. But the basic idea is clear: rather than an equal payment to all as under UBI, MIG is a payment targeted on those in need. 


    MIG and UBI compared

    The philosophy of needs-based targeting has a number of implications for the design of MIG, and therefore how it compares with UBI in practice. To gain a better understanding of the differences, this article takes the standard definition of UBI – a payment to all individuals, without conditions or means-testing, and sufficient to meet basic needs – and considers how MIG would look under each of these headings. This exercise is partly speculative, because there is as yet no agreed specification for a broad-based MIG. But we can already draw some conclusions based on existing proposals, pilots and schemes. In particular, a very helpful contribution is the recent report by IPPR Scotland, Securing a Living Income in Scotland: Towards a Minimum Income Guarantee. It presents a detailed preliminary outline of what a MIG for Scotland might look like. 

    Universality

    UBI is paid up front to everyone. With MIG, while the ‘guarantee’ applies to everyone, its targeted approach means that only a minority of the population (those deemed to be in need) actually receive a payment. The IPPR describes its proposal as a “universal guarantee, delivered through a targeted payment.” As will be discussed below, targeting can be based on household types but is mainly based on income. 

    Some guaranteed income pilots (in the US) focus on particular demographics, for instance on African-Amercan mothers, young people leaving foster care, or post-incarcerated Black people. It is not clear whether this kind of demographic targeting is used for the pilot only or whether it would also apply to a broader rollout of these schemes. If so, a MIG could end up being targeted on low-income members of particular demographic groups.

    Behavioural conditionality

    A UBI has no behavioural conditions attached – everybody gets it whatever their employment status, and there are no other requirements such as training or job search activity. Similarly, MIG is also likely to be free of behavioural conditions – if it were not, it would make little sense as a guarantee. Behavioural unconditionality is probably the respect in which UBI and MIG most resemble each other. 

    Means-testing

    A UBI is not means-tested, that is people receive it whatever their income. MIG is different: following the principle of targeting, it is only paid in full to people on low incomes. As income from other sources (e.g. earnings) increases, the MIG payments are withdrawn. In the spirit of targeting, and also in order to contain costs (discussed in more detail below), the withdrawal or taper rate is likely to be quite high. In the IPPR Scotland proposal, the taper rate is 62% (meaning that MIG is reduced by 62p for every £1 received from other sources). This is almost the same as the 63% taper rate associated with the existing Universal Credit scheme. In addition, there can be complicated interactions of mean-testing with the income tax and National Insurance system. With Universal Credit, the effective marginal rate is as high as 75% for some low earners (those subject to the UC taper on top of income tax and NI). Similar perverse effects would be likely in a MIG system.

    In practice, the mean-testing difference between MIG and UBI may be less than it first appears. The reason is that a UBI is likely to be (partly) funded through increases in income tax rates. So as income rises, some of the UBI is effectively ‘paid back’ through higher taxes.

    This amounts to a ‘mean test’ via the tax system, as opposed to an assessment up front (a distinction which has been called back-end versus front-end means testing). One recent UBI costing, delivering payments similar to the IPPR Scotland MIG levels, proposes an income tax of 50% on net beneficiaries (those whose UBI exceeds the tax). While this appears high, it is still lower than the likely MIG taper, resulting in higher net payments (for a given base level of benefit). The tax rate at low earnings could be reduced by shifting taxes to higher incomes or substituting other progressive taxes, and clearly this would increase the redistributive effects of UBI.

    For the same taper or marginal tax rates, both back- and front-end methods lead to the same net income – but there are important differences in the framing and mechanics. With a back-end system (UBI), the emphasis is on the same payment delivered to everyone, with any clawback occurring afterwards (and possibly with some delay if taxes are assessed annually); while with a front-end system (MIG), the payment differs across people right from the start. 

    As such, there is a risk that MIG may perpetuate the stigma, stress and bureaucracy currently experienced by people on means-tested benefits. In contrast, with a UBI plus income tax clawback, stigma disappears because the means test is merged into the tax system and applied to everyone. 

    There would also be administrative savings from integrating taxes and benefits, which would reduce the net cost of UBI (that is the cost after subtracting any benefits replaced by UBI and tax payments due to the back-end means test). Estimates of the relevant DWP administration costs range between £6bn and £8bn, and a recent estimate of UBI net cost is £67bn. Thus savings could amount to 10-12% of net cost (although some separate administration of payments such as disability benefits would still be needed, in addition to more resources for tax collection).

    Individual or household based?

    UBI advocates are always clear that, as a matter of principle, UBI would be paid to individuals, not households, and that all individuals would receive the same amount (except for some variation by age, for example lower payments for children). In this view, everyone is entitled, as a matter of right, to a basic level of income that provides them with the economic foundation needed to flourish as a citizen. 

    MIG, in contrast, appears to be motivated by more technocratic considerations and a narrower focus on standards of living. Since people in households can, up to a point, share facilities and space (such as kitchens and bedrooms), those living together require less income than a single person for the same standard of living. For this reason, official poverty thresholds vary across types of households, as do the JRF Minimum Income Standards (MIS). The MIS specify the levels of income deemed necessary (by the general public) for a minimum acceptable standard of living. 

    Following this household needs approach, MIG would be set at different levels (per person) for different types of household. For its scheme, IPPR Scotland proposes a core amount of  £792 per month for a single person but only £1,244 for a couple (£622 each). The couple payment would be made separately to each person (with additional payments for children going to the primary carer), but this still represents a significant departure from the individual-based principal of UBI (to my knowledge, the only UBI proposal to take on board the household-specific dimension is UBI+, which includes an specific ‘home allowance’).

    Amount of payments

    While in principle UBI should be sufficient to cover basic needs, in practice there is much debate around what the right amount is, especially for a UBI that could be seen as an introductory measure. Amounts proposed in the UK for working-age adults range from around £50 per week (sometimes termed a ‘partial UBI’ or ‘dividend’) to more than £200 per week. Since almost by definition a decent amount paid to everyone is costly, most detailed policy proposals have been strongly influenced by cost considerations – in particular there is often a desire to limit increases in marginal income tax rates, which are politically unpopular and can be economically distortionary (including via a ‘poverty trap’ at low incomes). 

    With MIG, the constraints are less severe because MIG is explicitly targeted on low incomes. That implies, by design, high taper rates. A MIG with a high taper rate will have a lower net cost than a UBI funded by more evenly spread tax increases (because a taper on low incomes affects everyone on that portion of their income).

    Thus for a given budget, MIG can ‘afford’ to be more generous than UBI – and the higher the taper rate, the higher the basic level of MIG can be (offset to some degree by the higher administrative costs of MIG).

    (The flipside is that MIG is disproportionately financed by the very people it is targeted on, who pay back large proportions of their MIG when their incomes rise, redistributing less from higher earners than UBI).

    Since there is a strong focus in MIG on household needs (using MIS as a guide in the UK), and since costs can be contained using a high taper rate, it seems likely that MIG will be near the high end of amounts suggested for UBI.  The Scottish proposal is for a core MIG to an individual of the equivalent of £168 per week, accompanied by a steep taper of 62%. NEF has proposed a MIG of £227 per week during the Covid crisis, and their ongoing work on a Living Income draws heavily on MIS, suggesting similar levels for a longer-term payment.

    Other support measures

    Finally, both UBI and MIG exist in a wider socio-economic context of issues such as low wages, inadequate public services, and a lack of affordable housing. Proposals for UBI recognise these issues, but generally focus on the case for UBI itself, while arguing that a UBI can have wider beneficial effects – for example a UBI can give low-paid workers more bargaining power. The main focus in UBI is also on the core payment, rather than any additional payments to cover, for example, the costs of disability or variable housing costs (an exception here is UBI+).

    In contrast, a MIG is likely to be part of a broader package of labour market measures. One reason is that with a high taper rate, MIG may provide little support for those in employment; moreover the taper will disincentivise people from taking low-paid jobs. For the MIG to work, it needs to be accompanied by wage levels sufficient to ensure that everyone in full-time employment earns well above the MIG level. 

    A MIG also specifies variable payments as part of the core model. These account for different family types, as already seen, but can also include support for housing costs, disability and informal care responsibilities. Finally, a MIG might be linked to a broader Social Guarantee including access to public services, which some MIG advocates argue is a more cost-effective solution to basic needs than monetary payments alone.

    Conclusion

    As UBI moves from concept through to design and implementation, it is important to understand whether MIG is just another flavour of UBI or an alternative policy offer. Returning to the definition of UBI – an individual payment, without conditions or means-testing, and sufficient to meet basic needs – how does MIG compare?

    Two aspects of MIG are UBI-like and should find favour among UBI proponents. The first is that MIG does not impose behavioural conditions – so whatever somebody’s employment or other activity, they are guaranteed to be above a minimum income threshold. The second is that MIG is likely to be set relatively high, comparing favourably with the amounts suggested for UBI. 

    But in other respects, MIG diverges significantly from UBI. MIG is means-tested and varies across household types. It segregates people into recipients and non-recipients, with the attendant risks of stigma which are a feature of existing benefits (as well as being more costly than UBI to administer). And its high taper may have significant disincentive effects on employment. By comparison, while UBI may be subject to a ‘back-end’ means test via the income tax system, the marginal tax rate on low incomes will almost certainly be less than the MIG taper. Moreover, depending on the taxes chosen to finance it, UBI will also be more redistributive. 

    Means-testing and household-level assessment will be strongly opposed by UBI supporters. In the UK context, MIG may look too much like an expanded version of Universal Credit (albeit with less conditionality). Nonetheless MIG will be attractive to others as a pragmatic extension of the traditional UK approach to income security. And the technocratic aspects of MIG will appeal to those who consider UBI to be overly utopian or too much of a radical departure from the current system. So to finish, it is worth considering whether there is any room for combining the two approaches. A couple spring to mind:

    • A Negative Income Tax (NIT) is a form of UBI financed by income tax but delivered as a single net payment combining the UBI and income tax. The payment falls as income rises, similar to MIG, but since income tax is assessed individually (in the UK) the NIT would be individual-based (with the same basic amount for all). So an NIT could be seen as a halfway house between MIG and UBI.
    • A ‘partial’ UBI could be at the core of a broader MIG system – it would deliver a base level of income to all, with additional MIG payments subject to needs- and means-testing. This could be a step in the direction of a full UBI if the additional components were converted over time into universal payments.

    There are no doubt more possibilities, and others will emerge as more detailed MIG and UBI proposals are developed. Ultimately there may be more than one route to economic security. 

    ____________________________________

    About the Author:

    Mark Bryan – @M_L_Bryan. Mark Bryan is a Reader in the Department of Economics at the University of Sheffield. His research investigates people’s experiences and outcomes in the labour market and their links with health and well-being.

    He is particularly interested in how a UBI might change the operation of the labour market. As well as carrying out academic research, he has worked on policy-related projects for government and private-sector organisations, and is an expert on statistical techniques to assess the impacts of policy changes on the economy. He co-authored the UBI Lab Sheffield proposal for a UBI pilot.July 23, 2021

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  • Adopting basic income scheme in Wales could improve health for all

    A new report published today (22.06.21) by Public Health Wales suggests that introducing a basic income scheme in Wales could be a catalyst for better health and well-being outcomes for all.  

    The idea of a universal basic income, a form of social security aimed at providing all people with a set amount of regular income, for example £500 a month without means testing, has existed for centuries but never been fully implemented.  

    Based on international evidence, key findings of implementing such a scheme identified potential positive effects on people’s health, including:  

    • Increasing income security: Money worries are one of the most common triggers for anxiety and depression 
    • Reductions in child poverty and improvements in other childhood outcomes: Research shows that children are able to learn better at school when they have enough to eat and a stable family life 
    • Improved educational attainment: Children from a financially secure background are more likely to stay in education longer or return to education   
    • Additional money for those more likely to be in lower paid jobs such as disabled people and women from deprived areas, leading to a higher standard of living 
    • Greater food security and improved nutrition 
    • Housing quality improvements and more affordable housing options 
    • A decrease in hospital admissions particularly in relation to accidents, injuries and mental health conditions 
    • However, when schemes were stopped, the positive effects diminished and in some cases well-being worsened from before the scheme was implemented. 

    The report ‘A basic income to improve population health and well-being in Wales?’ considers a range of evidence and explores the potential impacts on health and well-being. It also looks into the different approaches to policy design and implementation internationally.   

    Report author Adam Jones, Senior Policy Officer for Public Health Wales, said: “How well a basic income scheme works would certainly depend on how it’s designed and delivered. 

    “How much income it provides, who is eligible for the income, and how long the scheme is designed to last are all crucial factors in determining outcomes. 

    “The protection and improvement of Wales’ health is at the heart of everything we do at Public Health Wales. Evidence suggests that members of society would benefit from an income that supports their health and wellbeing and allows them to contribute to society and flourish.  

    “A form of basic income is one of the options government can consider to achieve this. It is a radical concept that has yet to be adopted formally by any country but parts of Canada and Finland have trialled schemes, with different approaches, with both seeing positive impacts upon health and well-being in the population. These included people reporting better mental well-being, with improved satisfaction in their lives, and less mental strain, depression and loneliness. Recipients also noted improvements in income security, educational uptakes, and community participation.  

    “However this is based on limited evidence, and there are many areas where there is minimal or no change in outcomes. Basic income as an idea and as a proposal is as multi-faceted and complex as the issues it needs to address.” 

    The report identifies options for policy-makers who are thinking about basic income, such as carrying out economic modelling, placing health and wellbeing as a core aim of any scheme, and carrying out feasibility studies to understand how basic income could be introduced in Wales. 

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  • Basic Income Will Increase Workers’ Bargaining Power

    The economic consequences of the COVID-19 pandemic have brought calls for a universal basic income. While it’s no silver bullet, they can allow workers say no to the most thankless, low-wage work, providing a platform from which to rebuild our bargaining power.

    AN INTERVIEW WITH DANIEL RAVENTÓS by Àngel Ferrero

    The economic consequences of the COVID-19 pandemic have brought calls for a universal basic income (UBI) back into the spotlight — and so, too, criticisms of it. This is especially the case in Spain, where a more conditional “minimum living income” project introduced by the left-wing coalition government has been undermined by poor delivery and only limited take-up by those entitled to the scheme.

    A possible way forward comes from autonomous Catalonia. Following the recent elections there, the anti-capitalist Candidatura d’Unitat Popular (CUP) has agreed to give its support to a government of the soft-left Esquerra Republicana de Catalunya (ERC), through a pact which includes the approval of a pilot program for full UBI.

    Daniel Raventós is a professor at the Faculty of Economics and Business at the University of Barcelona, as well as the president of the Red Renta Básica. He spoke to Àngel Ferrero about the pilot, its limits and the potential uses of UBI.

    AF: You’ve been researching UBI for more than twenty years. How would you define it, in concise terms?

    DR: A universal and unconditional public monetary allowance.

    AF: Although UBI is not yet a reality, there have been several pilot projects. What have the results been?

    DR: There have been trial runs in many different geographical and political contexts, from Finland to Canada to Namibia. Not all these projects have been implemented in the same way, which sometimes makes it difficult to compare them.

    These experiments have many limitations. One of the main ones is that they can’t show some of the major effects UBI would have on society as a whole: in particular, increased bargaining power for workers and women. The people receiving the UBI in the pilot projects tend to be isolated from each other, so it’s hard to judge their aggregate effects.

    Clearly, planning your life with a UBI you expect to have for two or three years is something very different from planning your life with the expectation of a lifetime UBI. But these experiments do allow us to evaluate, with all the limitations I have mentioned, partial aspects such as the effects on mental health. In each of these cases, mental health improved. Which is no small thing.

    AF: But with a UBI, are the material conditions of existence guaranteed?

    DR: Not with this alone, of course.

    UBI must be understood as one policy measure, not as a complete economic policy unto itself.

    An economic policy includes fiscal, monetary, labor measures… and, for me, a maximum income, too. A few people having huge fortunes is a threat to the freedom of the majority — and you don’t even have to be a socialist or republican to recognize that.

    AF: In Catalonia, two parties recently reached an agreement for government, including a UBI pilot program. What is the status of the negotiations?

    DR: Well, the agreement talks about the implementation of a pilot plan in certain age groups of UBI in three temporary phases. This is a very moderate, very reasonable, very measured move — which has already sparked the ire of both the pro-independence Catalan right and Spanish monarchists. And also of a certain kind of left who have great respect for, and servility toward, the status quo. It is funny to see the allergies this proposal provokes among some politicians and technocrats, even just when it’s a trial scheme.

    As far as I know, both the [anti-capitalist] CUP, which had UBI very clearly in its electoral program and made it one of the main axes of its campaign, and the [soft-left] ERC, which referred to the UBI as a longer-term measure, seem to be standing firm for this policy.

    AF: How could such a measure be financed?

    DR: Catalonia has nothing like fiscal sovereignty. The financing proposal that Jordi Arcarons, Lluís Torrens, and I have been investigating with some variations in recent years is based on a major reform of personal income tax, so that 80 percent would pay less tax with UBI and the richest 20 percent would pay more. Catalonia does not control 100 percent of income tax. That’s the way things are. Many people who are for a Catalan Republic consider UBI, along with other clearly progressive measures, are a good reason to want to become independent from the Spanish monarchy.

    Even so, it’s also true that the Catalan government does have the power to pursue a much more ambitious economic policy than the one it’s carried out in recent years. One of the aforementioned economists, Lluís Torrens, more than two years ago proposed a series of measures within the limits of Catalonia’s current autonomous powers, to finance UBI. Very briefly, these included: a wealth tax, reversing the inheritance and gift tax to 2008 levels, increasing environmental taxes, gambling tax revenues, and some modifications to personal income tax.

    AF: The COVID-19 pandemic has led to basic income being widely considered as a proposal to overcome this crisis. What are the advantages of basic income compared to other measures?

    DR: Conditional benefits for the poor have for many years proven to be insufficient at best and mostly catastrophic. Subsidies for the poor in Catalonia itself — the guaranteed citizen income — and the Spanish central government’s minimum living income have been a disaster. The former has been years in the making, the latter was implemented in June 2020 as a response (let’s call it that) to the pandemic-era social situation. Everyone, apart from its designers, has found serious flaws in it. If these are especially bad cases, the problems with conditional subsidies have been known for some time. Poor rollout can make things worse, of course, but the root problem is the design.

    What are the problems with conditional benefits?

    They have been known for a long time: the poverty trap, the high administrative and management costs, the stigmatization they involve, the insufficient coverage with respect to the population they ought to cover, and what is known as non-take-up, which is the segment of people who do not apply for a benefit even though they meet all the eligibility requirements and are thus entitled to receive it. In some cases, non-take-up is as high as 60 percent!

    The UBI overcomes these problems of conditional benefits — all of them. Perhaps this is one of the reasons why people who’d been opposed to the UBI recognized at the beginning of the pandemic that it ought to be considered.

    In the Basque Autonomous Community, which has one of the best subsidies for the poor in the European Union (nothing to do with the minimum living income or benefits anywhere else in Spain), a popular legislative initiative for a UBI has been launched. This is promoted, among others, by people who advise benefits applicants and are thus very knowledgeable about the reality of the subsidies for the poor, here. They are very competent and technically very knowledgeable people. Their conclusion is clear, and this is what they have stated: the Income Guarantee Payment, which is the name given to the Basque regional subsidy for the poor, has failed. Hence their support for UBI.

    AF: Feminists have defended, and also criticized, basic income. What are the feminist arguments in favor of UBI?

    DR: Well, the arguments offered by feminists are very diverse. At the risk of leaving out some important points, I think we can summarize these as follows. First, UBI would mean greater freedom for women. Already Mary Wollstonecraft pointed out that the attainment of rights, citizenship, and a better status for women, both married and unmarried, required their economic independence. Second, many women today caught in the poverty trap under the system of conditional benefits could escape it with a UBI, thus greatly mitigating the feminization of poverty.

    The economic independence that a UBI would allow would make it possible for many women to escape more easily from relationships where there is violence and abuse, as well as to leave paid jobs where sexual harassment or abuse occurs.

    Third, with financing that favors the majority of the non-rich population, such as that proposed by Jordi, Lluís, and myself, there is a transfer of money from men to women. This is consistent with what we know about the worse social, labor, and economic conditions that women have on average compared to men.

    AF: One of the arguments that you have had to combat most over the years is the idea that it would be better to guarantee full employment than UBI, also because a UBI would discourage job seeking, and even the value of work itself. Why?

    DR: Being a supporter of full employment is admirable, almost heroic in today’s conditions, but for me what’s interesting is to make clear whether we are talking about full employment in semi-slavery or in decent conditions. In the Spanish case, it should be remembered that from 1978 to today, this country has been the world champion among the OECD economies for joblessness: the place where the unemployment rate has exceeded 15 percent in thirty years out of forty-two.

    There is no doubt that there are parts of society with an employment-centric view, upholding the “dignity of work.” For me, the dignified thing is having a guaranteed material existence.

    Many authors, as different in time and intellectual hinterland as Aristotle and Marx, had no doubt that wage labor is “a limited servitude.” Marx spoke of the alienation of wage labor because, he said, as soon as there is no physical or any other kind of coercion, one flees from labor like the plague.

    Many think employment has special virtues: the most frequent being a sense of identity and contribution to the community, the dignity it confers, and a structuring of time, among others. A lot of things are mixed up in these statements. Job loss usually leads to terrible situations such as the loss of a home due to the impossibility of paying rent, as well as to serious depression and general deterioration of mental health, even to a sense of loss of identity. There is no doubt about it.

    Drawing the conclusion that people are less “happy” than when they did have a job is also defensible. Losing a job due to arbitrary corporate power, to a general or sectoral economic crisis — or for any other reason outside the newly unemployed person’s own will — is not going to make that person happier. That’s obvious, trivial even. But only to this extent can we relate involuntary job loss to unhappiness.

    If someone is faced with the choice of having a horrible paying job or a miserable life because of the lack of said job, it is easy to understand why they’d choose the former option.

    AF: Has there been resistance from the unions?

    DR: A lot. And there still is. There are exceptions and perhaps some cracks are opening up in unions’ monolithism against the UBI. We will see. I have been a member of a union for forty-five years, I have participated in union leadership and work councils for many years in the past, so I think I know this world very well. Over recent decades I’ve seen all sorts of arguments, I think I can summarize them as followed.

    It is argued, against UBI, that trade unions would lose strength because it would weaken their potential for collective action — although it is accepted that the UBI increases workers’ individual bargaining power. It is customary to add that the UBI could be used as a pretext to dismantle the welfare state, mainly public education and health care. It has also been argued that employers would exert pressure to reduce wages, since they would argue that part of their salaries would be covered by the UBI. Another argument is that, being a proposal that uncouples material existence from employment and the rights linked to it, UBI is unacceptable for the world of trade unionism — which, after all, makes work central to its worldview.

    The UBI — another objection from trade unionists maintains — could numb or appease the working class’s capacity for struggle by assuring it a minimum existence. This would mean that employers could make and unmake their plans with less trouble; this, in turn, would result in greater exploitation of the working class because the passivity that the UBI would bring would end up damaging their wage and social-welfare conditions. Finally, another trade union objection is that what we need to be standing for is full employment: giving people paid work is the right solution because that is what gives us dignity, and all the rest is mere palliatives.

    As I have answered this last objection already, I will briefly respond to the various others. The fact that individual bargaining power increases does not mean that collective bargaining power should suffer. In case of a long strike, a UBI could act as a resistance fund: a long strike is very difficult to sustain without a resistance fund because of the significant loss of wages in direct proportion to the number of days on strike.

    On the alleged dismantling of the welfare state. The right-wing advocates of the UBI do seek to dismantle the welfare state in exchange for UBI, but the left-wing advocates of the UBI seek a redistribution of income from the richest to the rest of the population and the maintenance, and even the strengthening, of the welfare state. Mixing the very different and opposing ways of defending the UBI of the Right and the Left is perhaps a propagandistic way of confusing the debate, but it has little to do with a rational and sincere discussion.

    It’s obvious that employers will bid to try to reduce wages using UBI. Or rather, they’ll seek to do that whether or not UBI is there. But that is part of what in times past was called, and in today’s times should be called, class struggle.

    AF: In Jacobin Michal Rozworski asked what the ultimate point of UBI was. I pass his question over to you: if there were a social movement broad and strong enough to implement an UBI, wouldn’t it make more sense to make much more ambitious demands?

    DR: The UBI is not a socialist program, nor is it a whole economic policy. In the face of any proposal for improvement, one can always say that it is insufficient and that it does not put an end to capitalism, for example. Or that it is possible to go further. That is irrefutable.

    But let me make a general comment.

    The UBI is a reform of the currently existing capitalism, it is not a measure that would do away with it.

    A capitalism like the present one, with a UBI, would undoubtedly still be capitalism, but it would be a capitalism notably different from the capitalism we know today.

    With the Fordist pact the working classes gave up control over production in favor of ex-post, conditional measures. They did that in a capitalism very different from today’s. I think that the UBI would allow the working class and the vast majority of women to significantly increase their bargaining power. Because by unconditionally guaranteeing people’s social existence, a UBI would enable the ability to “say no” to crappy jobs. For those who stand for freedom, this increase in bargaining power is something that alone deserves to be defended.

    ______________________________________________________

    ABOUT THE AUTHOR: Daniel Raventós is a professor at the Faculty of Economics and Business at the University of Barcelona.

    ABOUT THE INTERVIEWER: Àngel Ferrero is a journalist and translator, and a regular contributor to Público, El Salto, and Catarsi magazine.

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  • Seeing The Future In Our Past: Universal Basic Income And The Social Security Act

    Universal programs in moments of economic transformation prove to endure with popular support. Will it last?

    By: Shaby Missaghi

    History has a habit of repeating itself. In some ways, the present day feels stuck on loop in the past. During the early 1900s, the Second Industrial Revolution brough about far-reaching improvements to the American economy. The widespread adoption of electric power, railroad networks and improved manufacturing practices completely transformed American life.

    This is not unlike the economic transformation we are embarking on today.

    With automation, machine learning and other key technologies of the information age, the United States is yet again experiencing an era that will fundamentally change the way our economy works. Much like in past periods of advancement, these changes will prompt us to adapt.

    During the Second Industrial Revolution, the United States became more urbanized, less agrarian and overall more productive.

    These developments led to unexpected new challenges. Long life expectancy and the disappearance of the extended family under one roof gave rise to widespread financial insecurity — especially for the elderly. The Wall Street Crash of 1929 proved to be a tipping point in the American economy which revealed that financial insecurity. The Great Depression which followed left millions unemployed and struggling to feed themselves. It was especially devastating for senior citizens, who were already vulnerable from failing traditional security systems (assets, labor, family and charity) and faced a poverty rate over 50%.

    While not as severe in the long-term consequences, the COVID-19 pandemic did compound the growing problems of income inequality and financial insecurity in the American economy by causing a halt of in-person business that disproportionately affected working class families.

    In response to the economic crisis of his time, President Franklin D. Roosevelt enacted the Social Security Act (SSA) in 1935 as a form of “social insurance,” where workers pay into a fund through a payroll tax and collect from it after reaching the age of retirement. Social security was passed as a universal program, with no means-testing elements barring Americans from accessing the fund.

    At the time, critics called it anti-capitalist, socialist and unconstitutional. they complained it would promote laziness, reduce the labor force and ultimately hurt employers.

    Never in the history of the world has any measure been brought here so insidiously designed as to prevent business recovery, to enslave workers and to prevent any possibility of the employers providing work for the people, said Rep. John Taber (R-NY).Despite the criticism, the SSA passed.

    Today it is the most popular and successful federal program in United States history. Now, on the brink of another industrial revolution and with knowledge of the past, we have the chance to reap the benefits of technological change without bearing all of the weight from the problems it could create.

    Universal Basic Income (UBI), the unconditional distribution of recurring cash payments to all adults, reemerged in the political space as a means to address the coming changes to the American economy.

    In particular, UBI is commonly cited as a system that would help combat the threat of automation displacing millions of workers, which threatens to increase poverty and force blue and white collar laborers alike out of the work force.

    The meteoric rise of UBI in public polling after the use of stimulus checks in COVID-19 recovery legislation shows there’s a significant appetite for a program like universal basic income. Support for basic income is nearing majority support among all Americans, and pilot programs have begun in cities all across the nation.

    With the growing popularity of UBI, some of the same arguments lobbed at Social Security in the 1930s have been adopted to oppose it.

    Claims that a basic income would disincentivize work and that it would cause inflation are not dissimilar to the unproven claims made about Social Security. President Roosevelt had the foresight and commitment to safeguard some of our most vulnerable citizens in one of the nation’s darkest moments with a universal program. Today, our parents and grandparents are grateful for that leap of faith.

    We are now at a similar crossroads. Unfortunately, the stakes are higher and the consequences more more dire as the Fourth Industrial Revolution is predicted to be more disruptive to the economy and labor force than any revolution before it. If the trials of the Great Depression and enactment of the Social Security Act have taught us anything, it’s that enduring programs which benefit all citizens become widely popular and efficient at the task of adapting to great economic change.

    Time will tell if history will repeat itself again.

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  • Why Students Should Support Universal Basic Income

    We should not underestimate the financial hardship young people and students face due to high levels of debt, rising levels of mental health problems and low job prospects.

    By: Louis Strappazzon

    Students would benefit substantially from a Universal Basic Income (UBI), which is a model of citizen social security that gives everyone a regular and unconditional basic income per week or month as a safety net. It places trust in people, as vitally it is not means-tested and you can spend it in your best interests. Many existing means of social support will be kept, such as Child Benefit. No one who needs help will miss out. It would allow young people to take new opportunities. Students would be able to focus on their studies.

    Student Union Motion

    As a postgraduate student at the University of Manchester, I know how hard the past year has been for young people and how much a UBI would benefit them, just like many other groups in society. It is why I decided to table a policy motion at the University of Manchester Students’ Union (SU) Senate in May, which passed with 83% in favour, 7% against and 10% abstentions.

    Fellow students agreed that universities should be run like social institutions that look after their students and local communities. They act like cold-hearted businesses that care more for profit than student experience and welfare, a common theme at the university regarding its response to issues such as racism and mental health.

    The policy means the SU will promote UBI at national student level, and that the SU will push the university to research economic ideas like UBI which would help to diminish poverty, mental health problems, and reliance on precarious work.

    UBI is only one policy out of many that is needed to create a fairer society.

    Why UBI?

    There are many reasons as to why UBI would benefit students massively. From lowering mental health problems caused by financial anxieties to allowing more time to concentrate on their studies.

    Another is that job prospects have imploded and it is tough for many students to find a job from their degree. In March 2020, the Institute of Student Employers found that 27% of graduate recruiters would be recruiting fewer graduates in the near future. Between July and September 2020, youth unemployment had increased by 15% from pre-pandemic levels. A universal basic income would diminish economic precariousness caused by unemployment and unstable work substantially.

    This new socio-economic stability would mean less reliance on universities’ highly means-tested and complicated financial help schemes, such as the Living Cost Support Fund at the University of Manchester, which asks for financial checks galore. Whilst they are happy to take your fees with no checks whatsoever.

    A UBI would provide everyone a stress-free financial safety net, something that universities simply do not offer. This means greater opportunities for all young people, not just those who attend university.

    Children currently living in poverty – such as the 200,000 children in Greater Manchester – will potentially be able to go onto higher education, widening university participation. The fact that around 620,000 people in Manchester alone are in poverty shows how valuable a guarantee to be able to pay for food, rent, and bills would be. It would significantly change people’s lives for the better.

    Evidence of UBI Benefits

    There have been multiple studies that have proven this centuries-old idea necessary to combat poverty and economic precariousness.

    The pandemic made it clear as day that inequality is a large factor in death.

    A pilot between 2017 and 2018 in Finland showed that employment and school attendance increased, whilst stress, depression, hospitalisations, and indebtedness decreased with a UBI of £490 a month. Another example is a pilot that happened in Stockton, California. In March 2021, the results showed increased wellbeing, financial stability, and even greater job prospects.

    A universal basic income would provide everyone with a safety net and would eliminate the majority of extreme poverty in the UK. According to a study by economist Karl Widerquist, by keeping other benefits such as Child Benefit and a UBI of only £148 a week would mean families below the poverty line would fall from 16% to 4% in the UK. Child and elderly poverty would all but disappear. In turn, society would become more equal as a basic income becomes a right.

    Student Action

    A UBI, alongside other ideas, such as free or cheap public services, has the potential to diminish poverty and socio-economic insecurities significantly. Students and young people have the power to change the world because of our capacity to mobilise and as many of us have the belief that a more equal world is possible. That is why students need to promote socio-economic alternatives like UBI and get these ideas noticed in student groups, such as through passing SU motions. Young people have the power to influence politics and to improve not just our own lives, but all those in society that need help.

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  • Support is growing for a universal basic income – and rightly so

    The benefits of universal basic income is being recognized globally with the potential to provide everyone with a safety net that can improve the quality of life of every citizen.

    By: Guy Standing

    Wales has become the latest country to explore the idea of a universal basic income, which gives every adult a fixed amount of money, regardless of their employment status. Announcing plans for a pilot scheme was a bold move by the first minister, Mark Drakeford, who said he has a “longstanding interest” in the idea. And he is not alone.

    In Wales, a survey showed 69% of people supported a trial, and a letter asking the British government to consider similar plans was signed by over 500 cross-party politicians from across the UK. Already, 32 local councils across the country have voted in favour of a pilot in their areas.

    Since COVID-19, there has been a global surge in support too. In the USA, Los Angeles has become the latest city to launch an experiment, and there have been trials in Canada, South Korea and Kenya. In Europe, a poll last year, covering France, Germany, Italy, Poland, Portugal and Spain, found that more than two-thirds of people were in favour of a basic income.

    Of course, there are sceptics. The Conservatives reacted to the Drakeford’s announcement by saying Wales should not become “a petri dish for failed left-wing policies”. But there is nothing especially left-wing about providing everybody with a basic income – it is a matter of common justice that would enhance freedom and provide basic security for all.

    Paying every individual a modest weekly amount, with supplements for those with special needs, would be easier and less expensive than trying to identify “the poor”. And there is nothing in the concept to suggest it should replace other benefits, so no reason to claim it would increase poverty.

    Nor can critics legitimately claim that basic income pilot has failed. My recent books have summarised evidence from more than 20 pilots, in rich and poor countries. None have failed. On the contrary; even though the methodology, sample sizes and durations have varied, the outcomes have been remarkably consistent.

    The most common result is better mental and physical health. There are also clear improvements in nutrition, school performance, productivity, and status of women and those with disabilities. There have also been increases in work – not reductions, as critics claim there would be.

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    https://www.youtube.com/watch?v=O8B4U7o9kvg&t=3s

    One well known pilot was conducted in Finland over two years from the beginning of 2017 until the end of 2018, and resulted in better health and slightly more work for the 2,000 randomly selected unemployed people it was given to.

    My research indicates that these benefits would be far greater if the trial income had been given to a whole community, where it would bring more cooperation and greater impact on the local economy. Hopefully in Wales and elsewhere, pilots will be community based.

    A matter of justice

    The most common criticisms are that a basic income is unaffordable. But there are several ways by which it could be paid without steep rises in income tax – such as reducing the amount spent on tax relief for wealthy companies and individuals. Or, had the £375 billion spent by the Bank of England on quantitative easing after the financial crash of 2007-08 been spent on basic incomes, everybody in the country could have received £50 a week for two years.

    This leads to the ethical justification for a basic income. It is a matter of common justice, while enhancing freedom and providing basic security, which is a human need and a public good.

    As a matter of justice, we should acknowledge that the income of all of us is far more due to the efforts of the many generations before us than anything we ourselves do. Even billionaire Warren Buffett knows that, acknowledging the benefits given to us by our ancestors, when he said: “I personally think that society is responsible for a very significant portion of what I’ve earned.”

    If we allow private inheritance, then we could see basic income as a dividend on inherited public wealth created by our ancestors, paid equally because we cannot know whose ancestors contributed more or less. Critics who claim it is “something for nothing” and reduces the incentive to work, should logically oppose private inheritance for the same reasons.

    The pandemic has surely taught us that the resilience of all (and of the economy) depends on the resilience of the most vulnerable. The only way to ensure robustness and resilience is to have guaranteed protection – with a basic income providing an anchor of certainty and security.

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  • Making the Case for Universal Basic Income

    Jamie Swift and Elaine Power’s book offers a compelling argument that it’s time to give Canadians more freedom and security.

    By: Paloma Pacheco

    “The good we secure for ourselves is precarious and uncertain, is floating in mid-air, until it is secured for all of us and incorporated into our common life.”

    When American activist and social worker Jane Addams wrote these words in 1893, the world was in the heyday of its first run with free-market capitalism and liberalism. Ideas about the “common good” were not popular in the mainstream. The Industrial Revolution of the late 18th and early 19th centuries had paved the way for a cultural shift away from local economies and communal dependence. In Europe and North America, society’s focus was on mechanization, large-scale growth and a bootstraps-and-grit ethic that dictated an “every person for themselves” approach to life and work.

    It was an ideology that would become deeply entrenched in western culture, and that we are still immersed in today, argue journalist Jamie Swift and academic Elaine Power.

    In their new book, The Case for Basic Income, the duo presents an alternative vision for post-pandemic existence after a year that has exposed the fallacies of neoliberalism and the reality of our interconnectedness and interdependence. It’s a proposal that once seemed radical but is gaining increasingly widespread traction and appeal: a universal basic income.

    The concept of basic income (colloquially known as “BI” or “UBI”) is not new. In fact, it’s much older, and more tried and tested, than its critics give it credit. This is a pillar of Swift and Power’s exploration of the policy. No stone is left unturned in their thorough and convincing argument in favour of a basic income.

    Though the book focuses primarily on Canada’s history with basic income, the authors acknowledge its antecedents, both literal and imagined, all the way back to the publication, in 1516, of Thomas More’s Utopia. The idea of providing a fixed income for all members of society to meet their basic needs and, in doing so, escape cycles of poverty, instability and ill health, is not simply a utopian ideal, they conclude. It’s a well-studied and financially viable option that would benefit Canada’s economy and social fabric immensely.

    The Case for Basic Income opens with a short foreword by an Ontario-based family physician who writes of her concern for her patients at the outset of the COVID-19 pandemic. While she worried about an 86-year-old man who lived on his own and a young woman pregnant with her first child, she was most preoccupied with the well-being of a small dance studio owner who went out of business within the first few weeks of the pandemic. She knew how much the financial loss would affect her and, as a health equity advocate, she also knew that financial insecurity often leads to poor health outcomes.

    Luckily for this doctor’s patient, and for many thousands of Canadians, this woman was offered a life raft: the Canada Emergency Response Benefit, which provided $2,000 per month in guaranteed income. Along with the Canada Emergency Wage Subsidy, which subsidized employee wages for eligible businesses, the CERB provided temporary security and relief from the stress of losing work, something a large portion of the country’s population (some 5.5 million people) experienced when COVID hit.

    The fact that the government was able to provide this emergency support so quickly, and with few bureaucratic hurdles for applicants, write Swift and Power, proves that what is often deemed impossible is actually not: expanding the social security net to include more people and to offer genuine support instead of crumbs.

    While CERB was the closest Canada has come to a federal basic income program, it still left many out, and was dependent on meeting a previous employment threshold. People who had earned under $5,000 in 2019 were ineligible, along with those who had been unemployed previous to the pandemic or were coming off of EI or parental leave.

    This is where basic income differs. Basic income programs are not tied to employment, and, unlike welfare and disability assistance, they do not require constant monitoring to determine eligibility and deservedness.

    Swift and Power are unequivocal in their assessment of these systems: they are closer to policing than to a social service. Besides the difficulty of meeting eligibility criteria, once accepted for these programs recipients are punished for earning above a certain annual income on top of their assistance payments and must constantly prove their merit to government workers.

    If a true basic income were to be implemented in Canada, it would mean moving beyond the limitations of our current thinking around social security, say Swift and Power. And, perhaps even more importantly, it would mean a transformational reimagining of work, labour, time and freedom.

    For many Canadians, any mention of basic income is linked to Manitoba’s “Mincome” pilot program, launched in Winnipeg and the small town of Dauphin in 1975. Albeit short-lived (the program was cancelled by provincial and federal Conservative governments four years later), the resulting data is telling.

    Health economist Evelyn Forget, spurred by her own experience with childhood poverty, decided to dig into it in 2008, later publishing her research in an article for Canadian Public Policy. What emerged was a resounding advertisement for the program’s benefits. During the period that residents received a guaranteed income of $16,000 (nearly $80,000 in today’s dollars), hospital visits dropped by nearly 10 per cent and both fertility rates and high school dropout rates also declined.

    Swift and Power do not spend much time on the Mincome experiment — a topic that could have used more expansion, given its fascinating findings, as well as its place in the national imagination — instead zipping along to dive into two more recent basic income pilot programs, both in Ontario. Under the leadership of former Liberal premier Kathleen Wynne, the towns of Hamilton and Lindsay were both selected as trial sites for the Ontario Basic Income Pilot in 2017.

    This program saw 4,000 low-income earners receive $17,000 if they were single and $24,000 if coupled, and included a $6,000 top-up for disabled people. For those working low-wage jobs while participating, their basic income was reduced by 50 cents for every dollar they earned, until they hit a ceiling of $34,000 for singles and about $48,000 for couples.

    Again cut short by Conservatives — this time only several months in — the pilot program offered similarly striking results. And this is where Swift and Power’s book gains real momentum, as they zero in on the individuals positively impacted by the Ontario pilot program.

    Drawing on examples from a range of backgrounds and circumstances — a single mother with a disabled daughter and three other children to care for; a disabled man struggling with precarious employment, mental health issues and food insecurity; a young millennial working a minimum-wage job and looking for more meaningful work — they show how even the relatively small annual amount each of these people received made an overwhelming difference in their lives. Families were able to pay off long-standing debt and stop using the food bank; individuals were able to pursue higher education or start small businesses.

    The Case for Basic Income’s primary strength lies in its ability to connect these stories with the greater picture surrounding basic income.

    Like all good journalism, it uses the personal to shed light on the political and public, and in doing so, the book builds a solid and demonstrable defence for the approach. These real-world examples lend credibility to what basic income’s proponents often hold up as its main benefit: the freedom to choose a life of purpose and to live without the anxiety and fear that precarity and poverty entail, the reduced toll on the health-care system and the increased food security.

    Swift and Power have studied basic income for years, so they know that it has met with resistance from both the political right and left, and that spotlighting its wins is not always enough. They devote equal attention to criticism against it, gently but firmly showing how it is often misguided.

    For those on the right who believe giving a “handout” to everyone would simply discourage people from working, they argue that the poorest people in society are those that currently work the hardest: the (often racialized) workers the pandemic has deemed “essential” but not worth protecting with policies like paid sick leave.

    Basic income would offer some the opportunity to leave dangerous or exploitative working conditions, but it would also acknowledge undervalued forms of labour, such as (often gendered) care work.

    For those on the left, who might fear that basic income would erode labour protections and government-worker unions, as well as endanger important public supports like medicare and non-market housing, the authors propose that liberating people from social assistance would free up public-sector workers to provide more preventative health services. Unions would remain critical to the labour movement, and access to subsidized health care, pharmacare, child care and housing options would be a key factor in the policy’s implementation, funded by a progressive taxation system.

    Swift and Power don’t delve into the nitty-gritty of how basic income might be implemented at the national level in Canada, citing the “tricky policy knots” of our country’s provincial-federal jurisdictional issues. While it’s certainly a question that begs answering, the reality is that the details could likely make up their own book. And this one is about winning hearts and minds, not convincing skeptical economists.

    Ultimately, they argue, basic income is about freedom. Not the freedom of unregulated capitalism — the current system we live in, that prioritizes corporations above people — but a more expansive, human one.

    In a world increasingly dominated by precarious labour and the gig economy, as well as by growing automatization of jobs, skyrocketing economic inequality and a global climate crisis, it would mean an intentional value shift. Away from the worship of growth and towards a whole-hearted, intentional sustainability.

    It’s a powerful idea. And after the past year, and all the inequity, injustice and moral failings the pandemic has exposed, perhaps it’s one whose time has come.

    ________________________________

    The Case for Basic Income – By Jamie Swift and Elaine Power
    Between the Lines (2021)

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  • Basic Income isn’t just about reducing poverty

    At the heart of this concept is the idea of individual freedom and personal dignity, or more particularly, the means by which individuals can exercise their freedoms. Freedom from poverty is one such goal, but so is freedom to learn, freedom to do unpaid work, and freedom to be creative.

    By: Yuen Pau Woo

    From Greens to Conservatives, it seems everyone has a version of guaranteed basic income (BI) that they can support. There is confusion, however, over the objectives of BI, and very different views on what is feasible.

    The debate on BI has advanced with the recent publication of a study commissioned by the British Columbia government, and by tworeports from the Parliamentary Budget Office (PBO).

    The B.C. report rejects BI on the grounds that it would be cheaper to achieve poverty reduction in the province through targeted measures. The PBO report suggests that the national poverty rate can be halved at no net cost, assuming the elimination of some tax credits and social assistance programs.  Who is right?

    Both are, but advocates and opponents of BI would be wrong to use either report as validation. That the PBO simulation was able to “force” revenue neutrality is simply a matter of accounting. While it is impressive that this scenario reduced poverty significantly, the authors of the B.C. report would surely counter that they could get as much poverty reduction using targeted measures, at lower cost. To the extent that the policy objective is poverty reduction, the B.C. report is solid.

    It should be obvious that if we throw enough money at the problem of poverty, we will make a big dent in poverty rates.  The question is always about trade-offs such as fiscal capacity, disincentive effects, administration costs and the distribution of benefits.

    That is why the case for BI cannot rest solely on poverty reduction. Basic income is not another anti-poverty measure. It is not employment insurance either. It is not even social assistance in the traditional sense of helping those with specific needs such as disability or homelessness. It is, rather, a different kind of social safety net for a different set of societal circumstances, including the changing nature of work.

    At the heart of BI is the concept of individual freedom and personal dignity, or more particularly, the means by which individuals can exercise their freedoms. Freedom from poverty is one such goal, but so is freedom to learn, freedom to do unpaid work, and freedom to be creative. There is a connection here to Section 7 of the Charter of Rights and Freedoms, on the right to life, liberty and security of the person.

    Basic income is not another anti-poverty measure. It is not employment insurance either. It is, rather, a different kind of social safety net for a different set of societal circumstances, including the changing nature of work.

    The B.C. report focuses on freedom from poverty and therefore advocates targeted interventions but worries that providing citizens with other freedoms through BI will create an unsustainable fiscal burden. On this, the PBO report is a useful corrective. One can quibble with the choice of tax credits eliminated to achieve revenue neutrality, but the point is that the fiscal cost of a BI is manageable – with decent poverty reduction to boot.

    What about philosophical objections to BI? The B.C. report suggests that a BI is “unjust” because it imposes undue burdens on certain taxpayers who will resent the fact that their fellow citizens are rewarded with cash even if they are not in poverty.

    Here again, the PBO simulation is instructive: The burden of a BI falls mostly on the third and fourth quintiles of the population, with each experiencing a modest net loss of two per cent of income that I believe can be mitigated by economic growth.

    The most efficient way of delivering BI is the tax system. Not everyone files taxes, though. But a BI program which on the one hand incentivizes individuals to register with the CRA and on the other hand spurs the CRA to enhance automatic filing is a reform that is long overdue.

    Furthermore, the elimination of some non-refundable tax credits as suggested by the PBO would simplify the tax system and make it less regressive. These improvements to our tax code may turn out to be even more important for productivity growth than BI itself.

    Both the B.C. Report and the PBO calculated work disincentive effects from a BI, but neither weighed in on the potential economic benefits of creative activity, innovation, lower health and criminal justice costs, and other pluses of BI that advocates point to. These are admittedly speculative, but any such benefits will only increase the upper bound in a cost-benefit analysis of BI.

    Since my framing of BI is more about liberty than it is about social supports, there is nothing to preclude targeted assistance for, say, disabled individuals. In fact, the PBO scenario assumes a universal disability payment of $6,000. While this amount is less than the federal Disability Tax Credit (DTC) that it replaces, the way it is applied means that disabled citizens with low income are better off than they would be under the DTC. It is, in effect, a progressive reform.

    In thinking about a post-COVID economy, it is commonplace to draw analogies to major post-war reforms in employment and health insurance, and social assistance. Basic income could be the major reform of our time, but only if it is grounded in expanding the liberties of citizens in society.

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  • A guaranteed basic income would help all Canadians fulfill their full human potential

    Introducing a Basic Income Guarantee would cost a lot of money. The good news is that we can finance them by raising taxes on the superrich.

    Opinion by Caterina Lindman

    Did you know that Canada introduced a poverty reduction strategy in 2018? Our strategy is to reduce poverty 50 per cent by 2030, in line with the UN sustainable development goal for poverty reduction.

    While there are many good reasons to have a poverty reduction strategy for Canada, I am wondering whether we are selling ourselves short.

    Twelve per cent of Canadians live in poverty, and a 50 per cent reduction in poverty by 2030 means that six per cent of Canadians would still be living in poverty, and that’s after 10 more years of strategic poverty reduction.

    Rather than an incremental poverty reduction strategy, why can’t we have a poverty elimination strategy in Canada? Why can’t we have bold action, over the next several years, for eliminating poverty in Canada by introducing a Basic Income Guarantee for all Canadians?

    Canada has a basic income for seniors, through the GIS and OAS programs, as well as one for families with children through the Canada Child benefit. What is missing is a Basic Income Guarantee for working age adults without children. Those on welfare only get about one-half of what they’d need to meet Canada’s official poverty line. A Basic Income Guarantee would top up people’s income to the poverty line, while incentivizing paid work, by clawing back income at a rate of, say, 50 per cent. (The clawback rate of 50 per cent was what was used in Ontario’s basic income pilot.)

    Yes, introducing a Basic Income Guarantee would cost a lot of money. The Parliamentary Budget Office calculated a net cost of $23 billion annually using the income amounts from Ontario’s Basic Income Pilot. The numbers are around $60 billion during a pandemic. We don’t expect to be in this pandemic forever, and the beauty of a Basic Income Guarantee is that it automatically puts more money into people’s hands when they need it.

    The good news about these figures is that we can finance them by raising taxes on the superrich.

    Perhaps Chrystia Freeland is the one to do it. She’s the only Canadian finance minister in history to write a book about plutocrats, subtitled “The rise of the new global superrich and the fall of everyone else.”

    The finance minister could introduce a wealth tax. A two per cent tax on assets in excess of $20 million is worth $11.2 billion per year.

    Another opportunity is to consider that while wages are taxed at 100 per cent, capital gains are taxed at 50 per cent.

    Eighty-seven per cent of the benefit of this lower tax rate goes to the top one per cent of income earners. Rectifying this would raise $11.3 billion more in annual revenues.

    The government could also levy a micro-tax of 0.2 per cent on financial transactions. This tax might dampen the amount of financial transactions, which would be welcome, because it would reduce the amount of speculation and short-term trading. There are $80 trillion of financial transactions in Canada, and without behavior changes, a micro-tax of 0.2 per cent would raise $160 billion annually. We could do a lot of good things with that revenue, easily financing a Basic Income Guarantee and a post-pandemic green recovery.

    Some people think that a Basic Income Guarantee encourages laziness. There was no evidence of that from the Ontario Basic Income Pilot.

    In fact, 81 per cent of participants felt somewhat or much more motivated to find a better paying job.

    Over 37 per cent of participants reported a somewhat or much better rate of pay. The safety net was enough to give some participants the courage to start their own business.

    There were some other great outcomes from the Basic Income Pilot. Eighty per cent reported better overall health, while 83 per cent reported better mental health. Forty-three per cent of participants drank less, while five per cent of participants quit drinking. Better health and less alcoholism, aside from its intrinsic value for people’s lives, saves our health-care system money.

    Because poverty impacts Indigenous and racialized communities more often, a Basic Income Guarantee is a concrete step toward reconciliation and racial justice.

    I am looking forward to Canada co-operating with the province of Prince Edward Island, which wants to implement a Basic Income Guarantee. We should seize this opportunity to try it out, and then Canadians can decide whether the whole country should have it, similar to the way that universal health care was pioneered in Saskatchewan before being implemented federally.

    A Basic Income Guarantee will help all Canadians reach their full human potential, and it can be financed by reducing wealth inequality.

    _____

    To see original article please visit: https://www.stcatharinesstandard.ca/opinion/contributors/2021/03/06/a-guaranteed-basic-income-would-help-all-canadians-fulfil-their-full-human-potential.html

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  • Opinion: Why UBI?

    This is a list of some arguments in support of UBI that I’ve most frequently come across during my years of following the UBI discussion.

    By Michael Anthony Lewis

    One of my earlier pieces in this series focused on objections to UBI. In this one, I’ll discuss arguments in support of it. Since that support has been varied, I’ll discuss it by grouping supporters into different categories. This is risky, since I might choose categories no supporter would choose for themselves. Hopefully, no one will take offense or feel I’ve mischaracterized their position. I’ll begin with what I call “second best freedom” UBI supporters. 

    The late economist Milton Friedman and contemporary political scientist Charles Murray are in this group. I suspect that, given his infamous views on race and intelligence, merely seeing the words “Charles Murray” here has some readers seething with rage. I have my thoughts about Murray’s views on these topics, but, for this piece, I’m putting those aside. Instead, I’ll focus on his views regarding UBI.

    Second best freedom UBI supporters prefer that government stay out of the business of providing income support. Instead, the provision of such support should be something private citizens/residents get to decide for themselves.

    If they decide to give money to the needy, or a private charity organization, that is their right. If they decide not to do so, that is also their right. Government doesn’t have the right to take people’s “hard earned tax money,” under threat of fines or jail should they refuse to pay, and give it to the poor. Given this way of seeing things, the modern welfare state is illegitimate. 

    Second best freedom UBI supporters, however (I once heard Murray say as much), believe that most of the voting public are not on their side and, therefore, aren’t aligned with them on the illegitimacy of the welfare state. Given this reality, some form of welfare state is likely to be around for the foreseeable future. Coming to this realization is where UBI enters the picture. 

    Second best freedom supporters offer the following compromise position:

    We abolish the welfare state in its current form and replace it with a UBI. That’s because a UBI, in their view, is a better way to provide assistance to people than is the inefficient and paternalistic welfare state that we currently have. 

    The philosophers Philippe Van Parijs, Matt Zwolinski, and Karl Widerquist are members of a group I call “first best freedom” UBI supporters. Van Parijs thinks of freedom as, roughly, the ability of someone to do whatever it is they might want to do. This type of freedom requires access to resources, and a UBI would provide such access. 

    Both Zwolinski and Widerquist think of freedom as the “power to say no” to those (employers, spouses, etc.) who might take advantage of your need to be in a relationship with them.

    A UBI would promote freedom, in this sense, because it would give folks the power to turn down arrangements they didn’t like.

    For example, having access to a UBI and, therefore (assuming it was big enough), the resources needed to survive, would allow employees to turn down labor arrangements they didn’t think was to their advantage. 

    Another set of arguments for UBI focuses on unpaid care work. This is work, done mainly by women, caring for kids, other relatives, friends, etc., that isn’t part of the formal or even informal labor market. A UBI wouldn’t exactly provide a wage for such work but would decrease the cost of forgoing paid work in order to engage in unpaid care work. A UBI could be thought of, along these lines, as a way of subsidizing non-wage time that could be spent doing care work, should one want, or feel obligated, to do so (see Almaz Zelleke).

    Curtailing or preventing poverty is the focus of another group of arguments in support of UBI (see Max Ghenis).

    Those in this group view poverty as essentially a matter of not having enough money to avoid being poor. So, if we want to address poverty, the most direct way to do so is to give people enough money so they won’t be poor.

    That’s exactly what a UBI could do. 

    The presidential campaign of Andrew Yang, as well as some of the work of Scott Santens, highlights another argument in support of UBI: a way to address the impending job losses many predict will result from automation. Machines of various kinds are increasingly doing jobs that used to be done by humans. As this trend continues, more and more people will see machines take their jobs. And if many, perhaps most, of us rely on a job as our main source of income, this presents a problem. A UBI could address this by breaking the tie between receipt of income and the need to “work.”

    As many may have noticed, there’s a lot of talk in the U.S. these days about systemic racism. But a number of people were focused on systemic racism in the country long before George Floyd was killed in public view by a police officer. One of them is political scientist Dorian Warren. He’s connected the issue of systemic racism to UBI by offering a proposal called “UBI+”.

    UBI+ would pair a UBI which would go to everyone, with an additional amount which would go only to black people.

    This would function as a form of reparations for slavery as well as the decades of oppression black people endured after slavery and continuing to the present day.

    Another argument in support of UBI, begins with the premise that an efficient market economy requires consumers who’re able to buy the things that businesses produce. Many think that the foundation of a market economy is production. Proponents of the view I’m now considering (see Alex Howlett) believe this gets it backwards. 

    Consumption is the foundation of an economy because without consumers, producers would have no one to sell their goods to, they wouldn’t make much profit, and would, therefore, have little incentive to produce anything. Since consumption is the basis of any market economy, such an economy, which uses money as a medium of exchange, must come up with some way of getting money directly into the hands of consumers. We currently do this by emphasizing “work,” that is we emphasize the need for people to sell their labor in return for money.

    But this causes us to create unnecessary jobs as an excuse to give people money. This is inefficient; we should just give people money whether or not they sell their labor. And that is precisely the reason for a UBI. 

    The final argument I’ll consider relates UBI to the environment and conservation. As I said in the previous paragraph, businesses in a market economy produce goods and services for consumers to buy. The problem is that the current capitalist form of such an economy exacerbates global climate change, destroys the habitats of various non-human species, and has other destructive consequences for our natural environment. Many economists and others tend to focus on the importance of more economic growth. Those UBI supporters concerned about our current economies’ impact on the natural environment argue that less, not more, growth is needed. They argue that a UBI, by curtailing labor supply and, thereby, curtailing production, could play a role in fostering less economic growth (see Kate McFarland’s opening statement as well as those of others here and here).           

    I’ve gone over several arguments in support of a UBI. This isn’t an exhaustive list, just the ones I’ve most frequently come across during my years of following the UBI discussion. If readers have a better sense of the UBI landscape and ideas for where to learn more, then my goal for this piece has been accomplished. 

    _____

    To see original article please visit: https://usbig.net/why-ubi/

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  • New book, The Case for Basic Income, explores current challenges in todays climate

    “Although there is now a little library of books on Basic Income, we believe that our effort is unique in that it tells detailed, personal stories of people in Lindsay and Hamilton who received BI from 2017 to 2019 when the Ontario BI Pilot was in operation,” says Swift.

    By Jessica Foley

    The COVID-19 pandemic has exposed many discrepancies in our society. One of these inequalities, the idea of a liveable and obligation-free basic income (BI), is the subject of a new book by authors Jamie Swift and Elaine Power.

    The Case for Basic Income distills decades of research, in order to present the history of basic income and examine the issue in the context of current challenges to the job market, including precarious employment, automation, the climate crisis, and COVID-19, according to a press release from ZG Stories, who are promoting the book.

    Power came to Kingston in 2004 to begin a faculty position in what is now the School of Kinesiology and Health Studies at Queen’s University. Soon after her arrival, she sought out local anti-poverty activists and met Swift. A longtime social justice advocate, Swift took part in a weekly social justice vigil that started in 1995, standing in front of Kingston City Hall on Fridays.

    “That’s when a poor-bashing provincial government slashed social assistance by 22 per cent,” Swift said. “Those rates have never recovered. Many people live in poverty, obliged to wonder every single day about paying for food, shelter, and other basics.

    “Poverty produces uncertainty and insecurity, generating anxiety that, in a perverse cascade effect, produces stress-related disease. Millions of our fellow citizens – especially racialized people and newcomers who aspire to citizenship – are colonized by stress and uncertainty.”

    At Queen’s, Power developed and taught HLTH 101, The Social Determinants of Health, which examines the impacts of social factors, including income and education, on health. “Income is one of the most important determinants of health, operating through multiple pathways,” Swift shared with Kingstonist. “After guest speaker Rob Rainer came to Elaine’s class to discuss the idea of Basic Income to eliminate poverty, Rob joined a gathering of interested Kingstonians, including the authors, to discuss the development of an advocacy campaign to promote Basic Income.”

    Within two years the Kingston Action Group for a Basic Income Guarantee had succeeded in getting City Council to pass, unanimously, a motion in support of Basic Income.

    Kingston was the first city in Canada to do so, and many other municipalities have followed suit.

    After the Ontario Basic Income Pilot was announced (2016), the pair discussed the idea of writing a book using stories of Pilot participants. Swift was looking for a new project, having finished a book on how Canada commemorates First World War, titled The Vimy Trap. “Elaine had become a Basic Income advocate, travelling around, making presentations of the need for a BI, while amassing a fat bibliography of academic material that supported the policy proposal,” Swift said.

    “At the same time, interest in an idea that went back to the 16th century had been growing. The time seemed right.”

    They were in the midst of doing interviews for the book when the Ontario Basic Income Pilot was cancelled by the Doug Ford government (Aug, 1, 2018) after less than half of its committed three-year time span.

    “The lives of 4,000 low-income Ontarians enrolled in the Pilot in Hamilton, Lindsay and Thunder Bay were thrown into turmoil,” Swift said. “The rigourous scientific data collection plan was cancelled, a huge blow to social science- and evidence-based public policy decision making. The Pilot had attracted attention from media, social scientists, and basic income advocates around the world. Its loss was also felt globally.”

    “Our book’s dedication reads: To the 4,000 courageous people who took a chance on the Ontario Basic Income Pilot — and whose good faith hopes were shattered when a Progressive Conservative government arbitrarily and prematurely cancelled it,” he said.

    “Although there is now a little library of books on BI (sign of the spreading interest), we believe that our effort is unique in that it tells detailed, personal stories of people in Lindsay and Hamilton who received BI from 2017 to 2019 when the Ontario BI Pilot was in operation,” shared Swift.

    “So it’s the time-tested, journalistic device of using people (and place, as well) as prisms though which issues are reflected — Humanizing, personalizing.

    “We really hope these stories can help personalize issues around BI, although the book is surely chockablock with data and analysis.”

    The Case for Basic Income will be available on May 3, 2021 at book retailers everywhere.

    _____

    To see original article please visit: https://www.thestar.com/news/canada/2021/03/08/new-book-the-case-for-basic-income-explores-current-challenges-in-todays-climate.html

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  • UBI can help LGBT+ people and it’s on its way

    LGBT+ people have so much to contribute to our society—be it in enterprise, the arts or in our politics. But still too many of us are held back by forces well beyond our personal control.

    By Gareth Lewis Shelton

    If you’re reading this piece, then you’re probably at least curious about Universal Basic Income (UBI) and its potential to change society. Many of the arguments for and against it are increasingly well rehearsed—giving workers autonomy, ending poverty. But there are some aspects where the conversation is only just beginning: namely that UBI has the potential to help people right across society, it could be especially transformational for LGBT+ people. What’s more, the campaign for UBI is picking up pace, with more and more people and political leaders calling for it. It is on its way.

    Like with other underrepresented and minority groups, LGBT+ people often feel the harsh end of inequality. A troubling 2019 YouGov poll revealed that LGBT+ people in the UK in fact experience a sizeable pay gap to the sum of £6700 PA (about a 16% gap between them and their cis-het counterparts). This is almost twice the estimated gender pay gap (8.6% for full time employees). In addition, a slightly older study from 2016 found that bi men were particularly impacted by pay inequality. This research is less than a decade old, and much more needs to be done to understand how and why this pattern manifests, but in the meantime a UBI would at least smooth out this inequality.

    Helping close this gap would help LGBT+ people deal with the realities of the extra costs that they often have to bear, particularly in the area of healthcare (which you can read Daveed’s blog about here).

    Image credit - Sharon Mccutcheon
    Image credit – Sharon Mccutcheon

    Un-secure work and unemployment are potent challenges for LGBT+ people, particular for trans people and particularly so during the coronavirus pandemic. While unemployment figures for trans people are not actively monitored we are still able to piece together a troubling picture. In Ireland, trans unemployment is around 50%. In 2017-19 the UK Government carried out an LGBT+ survey of 108,000 people, and found that while 80% of respondents (16-24) overall had been in employment at some point in the past 12 months, trans people were almost 20% less likely to have been: with 65% of trans women and 57% of trans men having been in work in the 12 months leading up to the survey. 

    Protecting LGBT+ people from the pay gap and some of the harms of unemployment are powerful reasons in themselves to introduce UBI, but that’s not the full extent of how it could help and uplift LGBT+ people. It has a powerful role to play in giving LGBT+ people the means to escape oppressive environments—whether they be in the workplace or at home. We know all too well that harassment in the workplace is still a reality for many LGBT+ people.

    A TUC report from 2019 found that a shocking 7/10 LGBT+ workers experienced at least one type of sexual harassment at work, and that almost 1/8 LGBT+ women reported being seriously sexually assaulted at work.

    In addition Stonewall’s 2018 ‘LGBT In Britain: Work Report’ found that almost one in five LGBT+ staff had been the target of negative comments or conduct from colleagues in the past year; and that more than a third of LGBT+ staff felt the need to hide or disguise that they are LGBT+ at work because of fear of discrimination. It is vital that LGBT+ people in the workplace are equipped with the option to leave their employer where they do not feel comfortable, rather than feel trapped into totally unsatisfactory and unjust conditions.

    While the UK is lucky to have “the gayest Parliament in the world” with 45 out LGBT+ MPs, we cannot be complacent about LGBT+ representation in our politics.

    Too often LGBT+ people are still missing—or excluded from—our public debate.

    Some of that needs more campaigning for a culture change, but in other areas there are practical things that a UBI would be able to help with. For example, while it may be obvious that campaign materials are expensive in an election, funding yourself as a candidate while juggling work and campaigning is an acute challenge. Moreover, what people might not appreciate is that the work and campaigning to get selected as a candidate in the first place can be prohibitively expensive in some instances. As explored above, LGBT+ people often have fewer financial resources, which can have a prohibitive impact on access to politics. A UBI can help level the playing field. If we want to keep moving forward with LGBT+ rights, then we need more LGBT+ people at the table.

    Fortunately, the campaign for UBI is picking up speed, and more and more people and more political leaders have been calling for it.

    I was proud when in September last year, my party, the Liberal Democrats, returned to calling for Basic Income as official party policy.

    In 1989 then Party Leader, Paddy Ashdown, called for a form of basic income in ‘Citizens Britain: A Radical Agenda for the 1990s’. In our 2020 leadership election, it was great to see both Layla Moran and Ed Davey strongly make the case for a UBI as part of our platform moving forward. Right across the country, from Hull with Jack Haines to London with Luisa Porritt and Caroline Pidgeon, I’m proud that our party is making the case so strongly.

    And I’m even more delighted that it isn’t just our party that is making the case for a UBI. The Green Party has also very publicly called for a UBI, and there are new movements within the Labour Party and beyond to advocate for it as official policy. These green shoots are encouraging and we cannot afford to be precious or territorial about it. As with so many sweeping changes to our society, we need to continue to cultivate a cross-party and cross-society agreement to give UBI a strong and enduring foundation.

    LGBT+ people have so much to contribute to our society—be it in enterprise, the arts or in our politics. But still too many of us are held back by forces well beyond our personal control.

    A UBI cannot solve all problems—but at the very least it can help get LGBT+ people onto something approaching an equal economic footing, and grant us the autonomy to make the choices that are right for us. We shouldn’t wait for crises in order to do the work to remake our world, and make it freer and more open, but COVID-19 has given us a chance to reimagine things. Let’s not squander the opportunity.

    _____

    Gareth Lewis Shelton is Chair of the LGBT+ Liberal Democrats. Gareth is also an entrepreneur in the creative industries and holds a Masters in Political Economy of Europe from the LSE. Connect on Twitter @GarethLShelton.

    To see original article please visit: https://www.ubilabnetwork.org/blog/ubi-can-help-lgbt-people-and-its-on-its-way

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  • The pros and cons of universal basic income

    Unconditional cash payments to residents are more of a floor to stand on than a safety net, say these Carolina scholars in light of a proposed pilot project to give $500 per month to formerly incarcerated Durham, North Carolina, residents.

    By Logan Ward

    The idea of governments giving residents no-strings-attached cash payments is picking up steam, due in part to the economic impact of the coronavirus pandemic. Last June, Mayor Michael Tubbs of Stockton, California, created Mayors for a Guaranteed Income, a coalition to “advocate for a guaranteed income — direct, recurring cash payments — that lifts all of our communities, building a resilient, just America.”

    Durham Mayor Steve Schewel joined the group. In January, Schewel announced that Durham was one of 30 U.S. cities being considered to receive a $500,000 slice of a $15 million gift from Twitter co-founder and CEO Jack Dorsey. The money would fund Universal Basic Income pilot projects, such as the Stockton Economic Empowerment Demonstration.

    Durham council member Mark-Anthony Middleton announced that Durham’s proposed project would guarantee $500 per month to 55 formerly incarcerated residents until the pandemic ends and the city’s economy recovers.

    Before the pandemic hit, 2020 Democratic presidential candidate Andrew Yang put UBI, also known as guaranteed basic income, on the map by making it his signature policy. His proposed “Freedom Dividend” — $1,000 per month payments to every American adult — was a response to job displacement by automation.

    For a deeper understanding of this issue, The Well spoke with two Carolina faculty members who have studied UBI. Fabian Wendt, a teaching assistant professor in the College of Arts & Sciences’ philosophy department and the philosophy, politics & economics program, first came across UBI while studying theories of distributive justice. Doug MacKay, associate professor in the College’s public policy department, grew interested in UBI through research into paternalism in the U.S. social safety net.

    What is universal basic income?

    Wendt: It is a regular cash payment by the government that is given on a monthly or annual basis. It’s unconditional in several respects. In contrast to many other welfare programs that you only get when you prove your willingness to work, a UBI would be unconditional in that respect. It would also be unconditional on what money you make, what you have in general and on what contribution you made to finance the UBI.

    Finally, it would be unconditional on your family situation, on whether you’re married or not.

    UBI is probably best conceived as a floor to stand on, not as a safety net.

    A safety net is only meant to catch you when you need it, which requires some institution to test whether you really need it, and that opens up all these worries about paternalism, bureaucracy and so on, whereas the UBI would be a floor to stand on for everybody.

    MacKay: I completely agree with Fabian’s description. UBI is a platform to stand on and to build a life on. But it’s not something that’s going to allow you to live a great life. The sort of numbers that we’re talking about are, at most, $1,000 a month per person. People will still have a strong motivation to work.

    What are the goals of UBI?

    MacKay: The goals really differ, depending on the policymaker but also on who’s proposing it. I think for a lot of folks on the left, they see it as more a platform to build your life on. So it’s going to be there for you when you when you need it. If you think about the pandemic, when people are losing their jobs, it takes a long time for government to react.

    Had we had a basic income in place, that would have been a way of ensuring people are secure, have the ability to meet their basic needs and live a dignified human life. They don’t need to appeal to various agencies. They have consistency in terms of being able to afford housing, food and so on. It’s an anti-poverty measure.

    You also see from people on the left the idea of UBI as promoting freedom. Oftentimes we talk about freedom as being freedom from constraints.

    Some folks on the right, libertarians in particular, emphasize the need for government to stay out of our lives. And thinkers on the left often point out that if people are just leaving you alone, you might be unlimited in terms of choices, but you’re not actually going to be able to do anything unless you have resources. So the idea is that if people have a platform to build their lives off, they have resources every month. They can actually do things. They can meet their needs. They can pursue various projects.

    On the right side of the political spectrum, people see UBI as potentially realizing a number of goals. One, they emphasize this is anti-paternalistic in nature. There’s an element of government not interfering with the lives of individuals by imposing all these conditionalities on them, but rather just letting them be free to live their lives as they see fit with the income.

    The other thing that folks on the right emphasize is the way UBI might allow you to shrink the size of government. People on the left often think of basic income as something we’re going to add to the safety net and keep much of the safety net intact. People on the right often see it as a replacement:

    We’re going to give people a guaranteed income, and we’re going to get rid of a whole host of social safety net programs that cost a lot of money and require a lot of people to administer.

    Wendt: One thing I found interesting about Andrew Yang’s proposal was his idea to let people choose whether they either take the UBI or keep the benefits from current programs.

    Another thing different proponents will disagree upon is how high UBI should be. A thousand dollars a month was Yang’s proposal, but you could also go much lower or much higher. Maybe even “as high as is sustainable,” as [Belgian philosopher and economist and chief UBI proponent Philippe] Van Parijs would say.

    Its sustainability will depend on how high it is pitched, but also on how it’s financed. It seems very natural to think that it would be financed through the income tax. That would make it a close relative to a negative income tax proposal, which was popular in the 1960s and ’70s. [The influential American economist] Milton Friedman was a famous advocate of that. But Andrew Yang and others propose a mix in terms of how it’s financed. It could also be a sales tax or capital income tax or some other way.

    Andrew Yang put UBI on the map, but what’s driving it and why now?

    Wendt: 

    UBI has often been seen as a response to the challenge of automation — the worry that many people are going to become unemployed and replaced by machines.

    For example, truck drivers will lose their jobs once there are automated trucks. In the end, that’s not a new concern, though. People have worried that machines would replace jobs at least since the 19th century, but usually new types of jobs were always created elsewhere.

    The idea of a UBI was brought up last spring as a response to the pandemic — an emergency UBI. The coronavirus hit so hard. Many people felt like this was a chance to get some serious reform of the welfare state going. In the end we got the stimulus checks instead, which were not completely different, but a one-time thing, and not unconditional. The checks depended on how much you earned.

    One thing to emphasize is also how UBI would empower women. It gives working mothers cash to pay for childcare, for example, or it makes it easier to leave an abusive husband if you have something to rely on that is independent from the family situation.

    MacKay: The other thing I would point to are concerns about income inequality. I don’t think this is necessarily a great solution to the problem of income inequality, but I think the economic anxiety leads people to UBI.

    Is there evidence that UBI works?

    MacKay: There’s been a variety of studies. There were a couple of really famous experiments in the ’70s in Canada and here in the United States. There was a really interesting study in Manitoba in the late ’70s, where they had a whole town that was subject to a guaranteed income policy — a floor that families would not fall below. A lot of randomized controlled trials in low-income countries have been using cash transfers since the late ’80s, early ’90s. Some of these are conditional cash transfers.

    In Mexico, for example, you might get a cash transfer from the government if you send your kids to school and take them for yearly doctor visits. And there was one recently in Finland, where they gave $500 per month to unemployed folks.

    These are high-quality studies.

    The evidence has shown that the UBI programs are pretty effective in a number of different ways.

    The caveat I would give is that they happen in different contexts, and the interventions are very different.

    Wendt: An experiment in Kenya is the largest. It involves around 20,000 people and unconditional cash payments that cover basic needs. It started in 2017 and will last 12 years. There are four different groups. One group gets the cash for the whole 12 years. Another group gets paid up front rather than on a monthly basis, I believe. Another group receives payments for a shorter period of time. And then there’s a control group that doesn’t get any cash. Some people reported that it has changed how women see their role in the household, because they felt entitled to have a say over how to spend the money.

    What are the main points of criticism against UBI?

    MacKay: A big one is a reciprocity worry — that in order to get access to public benefits, you should be at least willing to participate in the labor market.

    Think of the earned-income tax credit. That’s a cash transfer that goes to low-income Americans. But to get access to it, you need to be participating in the labor force. A lot of programs like SNAP [the federal government’s Supplemental Nutrition Assistance Program, also known as the Food Stamp Program] and TANF [Temporary Assistance for Needy Families, another federal program] have work requirements attached to them. The Trump administration was trying to attach a work requirement to Medicaid programs, as well. The thought is, you should only get access to public benefits if you are participating in the formal labor market and earning an income.

    The question they ask is: Why should some group of individuals be participating in the labor force and paying taxes to fund a UBI for other people who aren’t participating in the labor market?

    One of the responses to this is that UBI recognizes all those forms of contribution to society that aren’t remunerated. Think about parents taking care of their children or poor people taking care of elderly family members.

    There’s lots of ways in which people contribute to society. And you can think of a UBI as reciprocating in that sense, remunerating people for those contributions.

    Wendt: Another common worry is that UBI is a waste of money on the wealthy. Why should all of those wealthy people get a monthly check? If the goal is to do something about poverty, then why UBI, since the rich by definition are not poor? That’s an understandable concern for sure. But the reply there is that depending on how the UBI is financed, the rich will not be net beneficiaries. They will contribute more to finance the UBI than what they get as their monthly check.

    What do you think about the Durham proposal?

    MacKay: This is the first time I’ve heard of a guaranteed income program that’s aimed at people coming out of prison. I think it makes perfect sense. Part of the justification here is that people with a felony record face a lot of difficulty in terms of accessing other public programs. I think they’re actually banned for at least some period of time from federal housing programs and from receiving SNAP benefits. Felons face a lot of difficulty getting jobs. Employers can legitimately ask if they have a record and deny them employment on that basis. So it makes a lot of sense that you would target this type of pilot project at those folks.

    If you think about who needs a platform in American society, it’s going to be people who don’t have access to these other programs and are economically vulnerable in terms of not being able to get a job.

    And so I think it makes a lot of sense that you would target the program this way.

    Oftentimes we discuss UBI as a major transformation to society, as a sort of utopian policy. That draws a lot of attention.

    But I think the discussion might lead to a simpler idea — just using cash payments in more of our social safety net programs. That might be more sustainable, more cost effective, than trying to try to implement a full UBI type policy.

    For that reason, what’s happening in Durham — a guaranteed income for a very narrow group of individuals — is really interesting.

    One thing the pandemic has shown us is that the government got a little bit more comfortable with giving cash payments to people. Another thing I’m really excited about are these proposals to expand the child tax credit, both coming from [Mitt] Romney and also coming from the Democrats, which you might think of as a basic income for kids. Every month, they would get a certain amount of money, maybe a few hundred dollars. The parents decide how to spend it, but the thought is it’s kind of like a baseline for kids.

    We don’t want to spend too much time focusing on the big UBI utopian policy proposals and miss that there’s a lot of interesting and potentially really important, cost-effective policy proposals around using cash payments in very targeted ways.

    _____

    To see original article please visit: https://thewell.unc.edu/2021/02/23/the-pros-and-cons-of-universal-basic-income/

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  • Opinion: It’s time to transform our society with a basic income guarantee

    The more distant someone is from mainstream culture, the more they need money to address their unique needs in their own way.

    By: Evelyn Forget

    The term basic income, in Canada, has come to mean an income-tested benefit – a guaranteed income close to the poverty line for those with no other income, and a reduced benefit for low-income workers.

    Basic income does not replace public services like healthcare and supports for people with disabilities. It streamlines and enhances cash transfers.

    The benefits of basic income have been documented in multiple studies. Mental and physical health improves. People invest in education.

    There is no evidence that overall work effort declines when a basic income is offered, and there is some evidence that basic income helps people move from precarious work to long-term employment.

    Studies remind us that when low-income people have money, they spend it in local communities and create jobs for their neighbours and families, which jumpstarts recovery from pandemic-induced job losses. Basic income allows people to stand up for their rights as workers and tenants without fear of retribution.

    Ironically, the strongest arguments in support of basic income appear in a recent report of the B.C. Basic Income Panel that recommends targeted basic incomes for people with disabilities, survivors of domestic violence, and kids aging out of foster care but stops short of recommending a basic income for everyone now living in poverty.

    There are no fewer than 194 uncoordinated programs offered by federal, provincial, and municipal authorities that offer support, in cash and in kind, to low-income people in B.C. alone, and B.C. is not unique. Programs have different entry points, eligibility requirements, and regulations designed by “experts” who believe they know best, requiring desperate people to navigate complex bureaucracies.

    Consequently, many people do not receive the benefits to which they are entitled. This system is so ineffective that tent cities and food banks proliferate, and we treat the consequences of poverty in our emergency departments and jails.

    The promise of ever more “wrap-around care,” coupled with administrative tweaks, must send shivers up the spines of people who know that public services rarely meet their needs: Indigenous mothers with kids in care, Black youths encountering racism at school, women incarcerated for poverty-related crimes, and trans and racialized people deprived of culturally appropriate medical care.

    The more distant someone is from mainstream culture, the more they need money to address their unique needs in their own way – and the more problematic the advice of “experts” becomes.

    Indigenous people have been victimized by coercive and ineffective bureaucracies for generations; consequently, the Report of the National Inquiry into Missing and Murdered Indigenous Women recommends a basic income for all Canadians. Basic income was the first call of the Black Lives Matter movement. 

    Critics point to the implementation challenges of basic income, but the recent CERB delivered a responsive benefit quickly, respectfully, and efficiently by relying on individual income reports and verifying afterwards. The glitches in roll-out occurred because applicants required $5,000 of (poorly defined) income in the previous twelve months.

    A basic income would not be conditional on past earnings, and defining income is surely within the capacity of policymakers. Up-to-date tax returns are not required, and people without Internet access can reach administrators directly.

    Critics exaggerate the costs of a basic income by breathlessly telling us how much it would cost to send a cheque to everyone, rich or poor, each month – an approach that virtually no one advocates – but costing exercises on well-designed programs show much lower costs.

    Taxpayers are already paying for the hundreds of failing programs that currently exist; is it too much to ask that their contributions be spent effectively?

    Basic income requires federal leadership, but Canada has a long tradition of allowing provinces to opt out, with compensation, to establish their own programs as long as they meet federal standards.

    A half-century ago, ordinary Canadians of diverse backgrounds came together to challenge entrenched interests and the status quo; they demanded universal healthcare, which transformed our society forever. As Tommy Douglas reminded us, “It’s not too late to build a better world.”

    ___________________________________________________________

    Evelyn L. Forget is an economist, professor at the University of Manitoba, and author of Basic Income For Canadians: From The COVID-19 Emergency To Financial Security For All.

    The post Opinion: It’s time to transform our society with a basic income guarantee appeared first on Basic Income Today.

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  • UBI’s Lessons for Redesigning Canada’s Social Welfare System

    UBI, at its core, is an unconditional cash transfer that guarantees a livable income regardless of work status. This differs from Canada’s current philosophy on welfare, which disincentivizes individuals from receiving financial support.

    Opinion by Sarah Thomas and Daniela Garabito

    In almost every aspect, 2020 has interrupted the global status quo and demanded innovative solutions. This includes Canada’s welfare system, which saw the Canadian Emergency Response Benefit (CERB) sidestep the heavily regulated and selective income relief system in just a few clicks. Likened to a Universal Basic Income (UBI), the CERB propelled alternative welfare models back into the mainstream. UBI’ was one of the biggest buzzwords of 2020, but debate surrounding the welfare system has existed for decades among academics and politicians. While British Columbia’s recent report on UBI did not ultimately advocate for the model’s adoption, it highlighted how we can draw on elements of UBI to improve Canada’s current welfare system. 

    UBI is often dismissed as a delusionary concept advocated by the extreme left. Yet this assumption frequently stems from misconceptions about what a UBI is.

    Multiple interpretations of UBI exist, which each conceptualize how a UBI should be modeled, and what the benefit levels should be, very differently. UBI can take many different names, such as a “basic income guaranteed”, “guaranteed livable income”, and “minimum income”, which hints that there may be subtle differences between them.

    This article refers to a UBI which, at its core, is an unconditional cash transfer that guarantees a livable income regardless of work status. This differs from Canada’s current philosophy on welfare, which disincentivizes individuals from receiving financial support.

    Existing theories on UBI also disagree on the cost and administration of such schemes depending on what form they take, such as a universal demogrant or a Negative Income Tax (NIT). 

    Under the NIT model, individuals lacking a steady source of income would receive the maximum benefit. As earnings from other sources increase, the benefit is decreased by a proposed tax back rate per dollar earned until the benefit is reduced to zero. This type of model is not foreign to Canada, as the Guaranteed Income Supplement essentially acts as a negative income tax targeted towards seniors. On the other hand, a universal demogrant provides a cash transfer to all citizens regardless of income. The Old Age Security credit is an example of a universal demogrant also specific to seniors, which is taxed back later from higher-income earners. This approach, which does not use means-testing, often generates the high up-front costs that can make a UBI appear wildly unaffordable.

    While implementing a UBI would not be a quick fix to alleviating poverty, the current patchwork of Canada’s social assistance programs has been failing to help those most in need for decades.

    In 2018, approximately 3.2 million Canadians lived below the poverty line. While many are caught by existing social safety nets, the vague requirements of these programs, which are also subject to personal biases, often cause many Canadians to fall through the cracks.

    Though social assistance regulations differ across provinces, their administrative frameworks remain relatively the same; applicants are subject to asset limits, which are the threshold of resources individuals may own and still be eligible for income assistance. Unfortunately, low liquid asset limits, such as the  $300 threshold for a single employable person in the Northwest Territories, restrict recipients’ abilities to save enough to become independent of income support.

    UBI skeptics typically raise concerns surrounding work disincentives, but current social assistance can be just as discouraging. In Quebec, a couple with two children receiving social assistance can only obtain $300 of net earnings before their benefits are reduced by a dollar for each additional dollar earned.

    Unless a recipient is deemed to have a disability, income support is almost always contingent on proof of work search. This requirement excludes Canadians struggling with mental illness or addiction, those with young dependents, and those engaged in full-time unpaid work such as caregiving.

    In British Columbia, single parents are considered “employable” when their youngest child is just three years old. 

    Despite MP Leah Gazan’s motion last August to make CERB a “permanent guaranteed income,” Canada will likely not adopt the model in the foreseeable future. This is not to say that there hasn’t been enough serious thought from politicians about UBI. In fact, a UBI pilot occurred in Manitoba in the 1970s  and again in Ontario in 2017. The 2017 pilot saw working-age participants receive monthly payments equivalent to 75 percent of the low-income measure, reduced by fifty-cents for every dollar of employable income earned.

    Both pilots showed positive impacts on the health, education, employment, and financial stability of participants. 

    However, a 2018 report by the Parliamentary Budget Office estimated that the cost of the Ontario pilot on a national scale would reach $76.0 billion in 2018-2019 and nearly $79.5 billion by 2022-2023. While the report estimates the 2018 net costs could be reduced to $44 billion if the program replaces other federal income supports, this remains a deterrent for most policymakers. Additionally, a federal UBI would require buy-in from every province, as welfare services fall under provincial jurisdiction. Such a drastic rebuild of Canada’s welfare system is unlikely, but understanding the beneficial aspects of a UBI could play an important role in improving what currently exists. 

    Unlike existing social assistance programs, UBI has lower barriers to entry and administrative costs thanks to its unconditional nature. Many social programs require extensive documentation to prove continued eligibility, which poses a great time-cost for applicants. For example, the Ontario Disability Support (ODS) requires beneficiaries to report their net income every month and submit pay stubs and receipts for verification, leading ODS employees to process nearly 35,000 documents per day. With research supporting that time spent navigating bureaucratic barriers exacerbates poverty, it is crucial to implement a program that eases paperwork requirements by having less stringent eligibility conditions.

    Contrary to Employment Insurance, a UBI protects gig economy workers, who account for 8-10% of Canadian workers, against involuntary job loss. Gig workers were only protected under the CERB, which was a merely temporary measure.

    By determining eligibility based on income, rather than working conditions, UBI eliminates Employment Insurance gaps and is better adapted to the modern labor economy.  

    In addition to protecting all workers, UBI differs from other welfare programs in that it ends, rather than perpetuates, the cycle of poverty. Current government assistance places stringent conditions on how recipients must pay back and utilize the aid they receive. The high tax on earned income for social assistance recipients constrains their ability to take risks, like searching for more rewarding employment opportunities or starting entrepreneurial ventures. In some provinces, it is also very difficult to combine social assistance with student grants and loans, which limits recipients’ ability to pursue educational opportunities that would expand their job prospects. 

    With few limitations on how the cash transfer can be spent or combined, UBI allows recipients to invest in their education or find more rewarding employment opportunities. This was shown in the 2017 Ontario trial, where the provision of a basic income encouraged many participants to leave low-paying jobs and take risks to reshape their careers.

    In fact, a third of those that responded to the post-pilot survey shifted to higher-paying opportunities, and one-quarter enrolled in educational programs. 

    Finally, UBI diverges from existing programs in that it aims to provide recipients with a livable income, rather than a minimal cash transfer that fails to cover their basic needs. In Ontario, for instance, a single employable person would have been granted a maximum annual income of $8,796  under existing programs, well below Toronto’s $24,163 Market Based Measure (MBM), which reflects the cost of basic goods and services. In contrast, the 2017 pilot provided single participants living in select Southern Ontario municipalities with $16,989 — double the previous amount.

     Policymakers should consider including several of UBI’s characteristics in the redesign of Canada’s social welfare programs. UBI involves a simpler bureaucratic framework than existing welfare schemes and incorporates more inclusive eligibility conditions. UBI is also better adapted to the modern labor market, providing critical income support to gig economy workers.

    Lastly, unlike existing social assistance programs, UBI’s unconditional cash transfer allows participants to escape the cycle of poverty.

    Although B.C.’s report found UBI unsuitable to target the diverse needs of the province’s residents, this innovative scheme offers an alternate welfare model based on accessibility, unconditionality, and simplicity that policymakers can learn from.

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    To see original article please visit: https://mcgillbusinessreview.com/articles/let-them-eat-cake-ubis-lessons-for-redesigning-canadas-social-welfare-system

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  • New documentary explores arguments for and against creating a Universal Basic Income

    The Cost of Living examines claims made by UBI’s supporters and detractors and includes interviews with welfare rights adviser Barb Jacobson, the late anthropologist David Graeber and environmental activist George Monbiot.

    By Sam Gregory

    Since the start of the pandemic, the movement for a Universal Basic Income – a regular payment given to everyone regardless of income, wealth or employment status – has grown immeasurably. In the UK, the UBI Lab Network, a project by Now Then publisher Opus, has been a leading voice, arguing that a UBI could end absolute poverty forever and ensure economic security for everyone.

    But critics of basic income, including the Conservatives, say the idea is too expensive and that welfare spending should be targeted to those most in need through existing systems like Universal Credit.

    A new documentary, The Cost of Living, examines claims made by UBI’s supporters and detractors, and includes interviews with welfare rights adviser Barb Jacobson, the late anthropologist David Graeber and environmental activist George Monbiot.

    Ahead of a free screening on 1 February, we spoke to filmmakers Sean Blacknell and Wayne Walsh of Gadfly Productions to find out what inspired the film and why they believe basic income is an idea whose time has come.

    Tell us about the film and how it came about.

    Sean: We came across the idea of UBI as an answer to job obsolescence during the second leg of filming for our first film, The Future of Work and Death. The more we researched it, the more we realised it’s not some idealistic silicon bubble fix. But we couldn’t fit UBI into The Future of Work and Death, so decided it to be the subject of our next film.

    Wayne: Due to the fact that UBI came up so often as a possible answer to job obsolescence and what Guy Standing calls the precariat, we decided that it would make a much better stand-alone companion piece as opposed to being crowbarred into the work section of The Future of Work and Death.

    What are the most compelling arguments for a Basic Income?

    Sean: That as a poverty trap prevention scheme it would most likely engender a culture of much more equal opportunity.

    Wayne: I find the evidence on the current levels of inequality and the direction in which we are heading with automation the best argument. It almost seems obvious that a basic income will be required in order to keep the system flowing as it currently works. It would be difficult to displace such huge amounts of workers and expect growth to continue. Though I do believe it is only a piece of the puzzle and something like universal basic services would need to be considered too.

    When do you think automation will start to have a major impact on the UK job market?

    Sean: Oxford economist Carl Frey – an expert we point to in the first film – says 35% of jobs in the UK are at high risk of automation by 2030. OECD say 10%. So if we split the difference, it’s fair to assume disruption isn’t too far away. Eventually though most jobs will be bested by computerisation, things could look pretty grim in 30 years if we don’t get a grip of it.

    Wayne: I would go off the same stats as Sean here but I would add that I think Covid will actually speed it up for some sectors. Retail, for example, will take a big hit as more people are becoming accustomed to shopping online.

    Has the pandemic changed the case for UBI?

    Sean: I think so yeah. I think more people are receptive to the idea now. But, as a bit of a pessimist, I’d imagine things would still have to get a lot worse for a lot more [people] before there’s any meaningful nationwide legislation or alternatives. I’m a hopeful pessimist, though.

    Wayne: 

    The pandemic has revealed just how little people have to rely on during hard times. I’m hopeful that it has also highlighted the need for progressive taxation on those with great wealth in order to fund these policies.

    Some critics say UBI is a nice idea but a non-starter because it’s unaffordable.

    Sean: There seems to be a consensus from both the left and the right that it is affordable. It’s just a matter of political will. As David Graeber says in the film, “Where do you think they found the money for quantitative easing? They just made it up.”

    Wayne: Those that say it’s unaffordable are not taking into account a more progressive tax system on the wealthy. I’m not advocating equality of outcome when I say that, just a lower level of inequality. History has shown time and time again that great inequality destabilises societies. Hopefully this time we will have the foresight to implement these kinds of things rather than let the whole thing crumble under a system of greed.

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    To see original article please visit: https://nowthenmagazine.com/articles/the-cost-of-living

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