UNIVERSAL BASIC INCOME

     Basic Income Idea: Give everyone,employed or not, a monthly cheque that can buy basic food, clothing and shelter unconditionally as a right of citizenship.

     A basic income was shown in the Mincome experiment to be able to solve problems related to poverty and health care outcomes without creating a disincentive to work that is actually the property of the current system. It benefited the working poor most. It also changed attitudes of people toward their neighbours judging by Professor Evelyn Forget's reporting of interviews she conducted with actual subjects in Dauphin. "When we're all the same there is no shame" a handicapped subject told her. You can't get that by increasing a benefit cheque that only a targeted population can receive. Search for Evelyn Forget on Youtube and find some interesting presentations.

     It's high time we recognise that the working class over the last few decades has been robbed not only of services but also cash and we should not be misguided away from something better by an ideological aversion to redistributing income by giving cash or fear of doing something big enough to be meaningful. Some services will still be needed and that is precisely why a party that cares about those left behind should be the one to implement a basic income that does not replace what will still be needed.

     Creating full employment might no longer be possible due to automation and would do no good if the new jobs are part-time, precarious and/or contract/temporary. If the old paradigm will no longer work we need to shift to a new one where people can survive with some dignity without a good job and where men getting acquainted ask what they like rather than what they do.


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  • commented 2017-03-22 17:20:47 -0400
    Larry: Galbraith’s book, The Affluent Society, is about the preoccupation with production and full employment, in addition to the starving of public services. It led him to support a version of UBI and that support in later editions is at the end of the chapter of the divorce of production from security. There is no administrating of a UBI program that is universal and unconditional. We already have a taxman who can send out the cheques. Scandinavians prove that people will pay more to their taxman if they get something in return. Why not pay people to administer the program? The whole point of UBI involves getting rid of the stigma of unemployment, which creates political support for the inadequacy and crazy rules of any means tested income support. Where there are no rules there is no bad guy and therefore no police. That is why UBI must replace those income supports. That lady on social assistance who has a “spouse in the house” is to become just another common-law wife on the block because we also get what she gets. There are people, proletariats, not helped by JG who benefit under UBI. People have a job that stinks but feel they need to keep it because it pays more the minimum wage have no interest in JG. People who are content with their jobs can collect UBI and it benefits the working poor most. People who want to change to part-time for any number of reasons have their hope in UBI. And here is one that makes UBI transformative: the lady who wants to leave an abusive husband, can’t work full-time and fears going on some stigmatising and inadequate means tested program. I don’t want these people sacrificed to someone’s desire to “have a job” instead of to “be freed up to…”. And that is why I favour the program that is about freedom rather than the program that is about jobs.
  • commented 2017-03-17 19:11:08 -0400
    Chris,

    1. The message of Galbraith’s Affluent Society is that the private sector provides us with 57 varieties of Ketchup and ice cream, but that we are starved of adequate public services. The JG program counters this by employing large numbers of individuals to provide community benefits.

    2. Under the proposed JG, non-profit and community groups design and manage the jobs. Both UBI and JG will still require government administrators to oversee the whole programs. I find it ironic that while you are happy to hand out money without conditions as a basic right of citizenship, you find it so difficult to pay people to administer a program.

    3. The JG allows those at the bottom of the totem pole – those last to be hired (if ever) and first to be fired – the opportunity to voluntarily accept a steady job, earn income, increase their skills through free training provided, enhance their self-esteem and make valued contributions to their communities. Your characterization of this program as “useless to large segments of the population” demonstrates a certain disdain towards the hard-pressed proletariat, does it not?

    4. If the JG deteriorated into “workfare”, then it would be a perversion of the program, just as it would if the UBI cut people from current social welfare programs, gave them reduced entitlements, and trapped them even deeper in poverty.

    5. As discussed, your preference for the large UBI financed by taxes would result in whopping tax increases, maybe 30 – 40%, for those least in need of the program. Seems like an exercise in fantasy to me.

    6. Readers now have links and background on all the major arguments and can come to their own conclusions. I do believe we share the same goals of ending poverty, inequality and improving the lives of all Canadians. Good luck with your advocacy, and you are welcome to have the last word. With best wishes, Larry
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  • commented 2017-03-16 23:55:28 -0400
    I totally agree that people should examine the arguments to compare Basic Income and Job Guarantee programs, preferably by telling people what they are talking about. You can find a good explanation of it here:

    http://basicincome.org/news/2017/02/basic-income-superior-job-guarantee/

    And a similar one here:

    http://basicincome.org/news/2016/10/greater-happiness-workers-basic-income-vs-job-guarantee-pt-2/

    I believe that scientific reasoning, based on facts, should prevail. As such it is important to look at the results of the most serious experiment with UBI, which is not a story of people being worse off because of inflation:

    https://public.econ.duke.edu/~erw/197/forget-cea%20(2).pdf

    Phillipe Van Parijs explains why the big ticket real UBI is the one to be adopted and although he won’t discuss it here it should be financed out of higher taxes:

    https://www.youtube.com/watch?v=EBzXZqJ9W6w

    And if anyone thinks even conservative Canadians cannot be persuaded into wanting something that does redistribute wealth consider this:

    https://www.youtube.com/watch?v=zBkBiv5ZD7s&t=2s

    UBI’s advantages are legion, to which I would add making it easier for women to leave abusive relationships without having to work amongst other things and of how JG does nothing for large segments of the population:

    http://www.basicincome.org.uk/reasons-support-basic-income I would also recommend Chapter 25 section 4 of Economics and the Public Purpose by John Kenneth Galbraith, as well as his previous book The Affluent Society that brings into question our continuing focus on increasing production and consumption. Guy Standing also is on several Youtube videos talking about what happened in pilot projects in India. And I call upon supporters of JG to come clean about they want to finance the bloating of the bureaucracy that they advocate, about why they support something that should know to be useless to large segments of the population, and about why their program will not turn out to be just another workfare.
  • commented 2017-03-16 00:50:11 -0400
    There are many different versions of income guarantees and job guarantees. There are some coherent income guarantee programs I would likely support and some punitive “job guarantees” that I definitely would not.

    However, in general I contend that universal income guarantees contain an inherent contradiction. If the purpose is to overcome inequality and poverty, then they will either be too small to do the job in order to be practical, or if sufficiently generous will raise funding and inflation issues that will prove socially divisive.

    Please refer to the CCPA paper whose link you provided and which states on P. 23:

    “They calculated the cost of a scheme that,
    in 1999, would pay the very modest income of
    $7,000 per year to persons age 65 and over, $5,000
    to persons aged 21 to 64, $3,000 to persons under 21 (paid to the primary caregiver), and an
    additional $5,000 paid to each household, to be
    divided equally among adult members of the
    household. The total cost of this scheme was estimated to be $198.6 billion in 1999 dollars. This
    guaranteed income program would replace federal benefits for elderly persons and children, as
    well as Employment Insurance benefits for the
    unemployed. Subtracting these savings, the
    net cost of their scheme was calculated as $161.7 billion in 1999 dollars (or $200.3 billion in 2009 dollars). As a point of comparison, the total federal
    government revenue for fiscal year 2008/09 was
    projected to be $241.9 billion. "

    In contrast, the Job Guarantee is a much more manageable program that substitutes a buffer stock of community workers (whose numbers rise and fall with the business cycle) for a buffer stock of unemployed. Since an estimated one-half of all poverty is a result of unemployment, underemployment and precarious work, the JG would effect a substantial improvement. In addition, the JG would act as a minimum wage floor for the private sector, and change the nature of work since jobs benefiting the community would not be evaluated by commercial profitability. Other programs could more generously target those who cannot work and require income guarantees.

    For those who would like more discussion on the pros and cons of JG vs UBI, please go to this link, and the various links therein.

    Job Guarantee vs Guaranteed Basic Income
    http://neweconomicperspectives.org/2014/01/16-reasons-matt-yglesias-wrong-job-guarantee-vs-basic-income.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+neweconomicperspectives%2FyMfv+%28New+Economic+Perspectives%29

    May the best program win! But in fact, the best program would almost certainly be one that combines both job and income guarantees.
  • commented 2017-03-14 19:34:08 -0400
    Response to Larry Kazdan

    Thanks Larry for engaging in this with me. I’m enjoying this.

    Under Universal Basic Income, you never face anything like this from Vincenzo’s comment about Job Guarantee and I would like to know if you or the admins of that site accept it:

    “If a worker is employed under the JG program he/she will do always the same job; no career, no change in position, always the same activity. He/she must accept whatever job is offered and, in case of refuse, cannot work under JG for the next two years. The same if he/she leaves the job provided by the JG program.” http://neweconomicperspectives.org/2012/03/mmp-blog-42-introduction-the-the-job-guarantee-or-employer-of-last-resort.html JG existing along with welfare/EI cannot really happen unless the latter changes its rule that recipients must look for and accept work. It seems to me that without that rule change which will get no political support JG gets reduced to Lenin’s dictum that he who does not work shall not eat. UBI changes that game. Maybe there is an over exaggeration regarding the threat of robots to employment but we cannot deny the reality of Uber’s self-driving cars, retailers that have no stores and banks that have no branches. If this nightmare scenario is right what is your cost estimate of having a welfare state indefinitely act as employer of last resort? You talk about WWII but not the huge deficits/debt that it produced. After WWII it was private spending and investment that sustained employment and that helped governments bring debt to GDP down to 22% in 1975, while today we have corporations stuffing under mattresses the billions they got in corporate tax cuts. If government will always be required due to private investment not doing its part, JG will bankrupt the country. I do not propose replacing jobs in health care and other sectors ministering to the old, sick or disabled or shutting down public libraries. It’s not about the public/private sector mix anyway. A UBI for most proponents including me would replace social assistance and disability pension payments.

    A neutral CCPA paper from 2009 gives a good rundown of different proposals and their approximate costs under different studies:

    https://www.policyalternatives.ca/sites/default/files/uploads/publications/reports/docs/CCPA_Guaranteed_Income_Nov_2009.pdf The UBI that I would prefer in my dreams is the universal demogrant model for every citizen 18-64 (not 33 million people) that gives a tax-free cheque even to the CEO of the Royal Bank, who also does not need to be given free health care and education. Universality gives political insurance. In Ontario in 1995 we saw the election of a majority PC government that campaigned on cutting social assistance cheques by more than 20% and making people work for it at the minimum wage, fulfilled that promise and obtained another majority in the next election. And people working for the money has not reduced the stupid hate that I can see continuing upon the worker under JG. What’s the difference between the two? I suspect that changing to a 50% income tax on any income above a tax-free UBI can get support as a new system even though a flat tax is not my preference. When I ask people if they would switch to the 50% tax for everybody to get a cheque I usually get a positive response. That would be effectively a version of the MINCOME system in Dauphin and those people voluntarily agreed to it. And the stupid thing about this whole debate all these years is that nobody other than Evelyn Forget would just [censored] go and talk to these people who lived it for four years. That being said, I would still be happy with a MINCOME style declining benefit, often called a Negative Income Tax, at the LICO rate. Under that experiment in Dauphin any income above the UBI allowance reduced that allowance by 50%. This would mean anyone with an income less than double the UBI figure would get something and those with higher incomes are just left to do their own thing. If set at a LICO of 23K, maybe 2/3 of the population would get some benefit, which would give it some political insurance. Depending on who you ask, it might even pay for itself once health care and crime savings fully kick in and some proposals are claimed cost neutral.
  • commented 2017-03-14 01:05:53 -0400
    Response re:

    “Larry: Thank you for your reply and it makes me wonder if you really understand the proposal to cease having people start off at zero.”

    If a guaranteed income program could be designed that gave individuals a livable amount, did not have inflationary tendencies, and did not create divisive conflict between workers and non-workers, I would certainly support it. We do in fact have forms of guaranteed incomes for seniors and children (i.e. families with children). For those who cannot work nor should not work, these programs should definitely be strengthened and improved, and would likely receive public support.

    Now let us see if I really understand your UBI proposal.

    1. Basic Income Idea: Give everyone, employed or not, a monthly cheque that can buy basic food, clothing and shelter unconditionally as a right of citizenship.

    2. The amount would be based on a stat such as Low Income Cutoff and would be adjusted every year.

    3. The UBI would not be financed by printing money.

    4. The UBI would not “solidify the conventional division between work and non-work” and presumably not lead to tension between workers and non-workers. What numbers would you use to get a ballpark figure of the cost of your program?

    The LICO is about $23,000 for an individual, and there are about 33 million Canadians. Let’s assume that 80% of the costs are recovered by terminating other programs and their administrative costs, and by taxing the payments. Will you be giving lesser amounts to family groupings? Let’s assume you make payments to 20 million people. The costs under assumptions above would be $23,000 × 20 million x 20%. According to my calculations, that still comes to $92,000,000,000. For comparison, the total federal revenues for 2014-15 was 282.3 billion, so presumably we are talking about at least a one-third increase in taxes.

    If I understand your proposal correctly, the $92 billion would have to be raised from those current workers and the rich, two cohorts not notably eager to accept sharp tax increases, even for the noble cause of releasing the proletariat from their chains. However, please entirely discard my calculations (provided only as a means for discussion) and feel free to provide your own numbers.

    You maintain that creating jobs is a separate issue, and question the government’s ability to create full employment. Here the charge of neo-liberalism arises. There are many jobs that provide community benefits in areas such as ministering to the old, sick and disabled, education and recreation for youth, protecting the environment, and artistic and cultural creation and presentation, all areas unlikely to be performed by robots. Government must not shirk responsibility for creating these jobs, jobs that the market does not need. A reminder that during WWII, the unemployment rate fell to 1%, and 1 of every 3 adult males was in the armed forces and on the government payroll. As the late British statesman Tony Benn put it, “If you can have full employment by killing Germans, why can’t we have it by building hospitals, schools, recruiting nurses and teachers?”

    The Job Guarantee provides a macroeconomic policy framework designed to ensure full employment and price stability is maintained over the private sector business cycle. Since jobs are designed by communities and evaluated for community benefit (not by profitability), the nature of work is transformed. Detailed information about the JG can be found at https://mmtincanada.jimdo.com/policy-issues/job-guarantee/

    Universal Basic Income programs are well-meaning and some variation would be arguably better than the system we have now. But would it be as practical and effective in relieving poverty and inequality as a full employment policy buttressed by a Job Guarantee, and with any gaps closed by a generous but more targeted programs for those need it the most?
  • commented 2017-03-13 00:26:31 -0400
    Larry: Thank you for your reply and it makes me wonder if you really understand the proposal to cease having people start off at zero.

    Maybe first people should look at what happens in a real life context:

    https://www.youtube.com/watch?v=e36U5MQZc5o
    https://www.youtube.com/watch?v=k9-sDDvKR8g&t=1565s

    1. A UBI/BIG does not mean that a government should not create jobs which is a separate issue, although we don’t know that its ability to create full employment will not be destroyed by the threat of AI/robots. If it cannot do so, UBI gives compensation whether you work for it or not and helps maintain consumer spending. As such it cedes nothing to neo-liberals even if some of them like this aspect of it as a means of “civilizing capitalism” or as a better automatic stabilizer.

    2. There are people who assume that anything that benefits the working class/poor must destroy the economy and seek out explanations of how it would happen. That was the argument about EI, minimum wage, CPP, health care, etc… and we are still waiting for that disaster. The MINCOME experiment benefited the working poor most without an offsetting disaster.

    3. A UBI is not left or right among economists and I don’t see why it should be among us.. Friedman advocated it and so did Galbraith and Guy Caron today. Until it gets implemented I would not anticipate a shortage of people on either side claiming it is a conspiracy of the other.

    4. If it has to be left or right I would argue that relieving people of the yoke of being proletariats, people who do not own property and who must therefore sell their labour to survive, is very left.

    5. A UBI gives more bargaining power to workers than the strike fund of any union leader who opposes it. Employers win when workers fear the consequences of unemployment under the current system.

    6. You talk about the importance of work for well being but do not seem to realise that UBI allows people to pursue work that is not commercially successful and recognises the importance of unpaid work such as raising children. As such it does not “solidify the conventional division between work and non-work” as you claim. It also allows people to hold out for the good job or start part-time if necessary even if they are the sole breadwinners.

    7. A UBI can create inflation if financed by printing money but that is not the proposal of the BIEN Network, Green Party, etc… If based on a stat such as Low Income Cutoff it would be adjusted every year anyway and that by definition is a proposal for a “living amount” that would alter the present income distribution.

    8. I offer no apology for advocating something that does not give a perfectly even distribution of income and which does not put people under control of case workers or government make-work bureaucrats.

    In short, I think we need to look pragmatically at starting people off at an income that is greater than zero and not see it as somebody else’s way to hurt us.
  • commented 2017-03-12 20:58:27 -0400
    Job Guarantee vs Guaranteed Basic Income

    The Job Guarantee: Delivering the benefits that Basic Income only promises
    http://media.wix.com/ugd/f4c1a3_a41dc8241e4e482591b513791ef17a2e.pdf

    “The BIG proposal is a compassionate but paternalistic policy that does not ultimately
    deliver the jobs that those at the bottom of the economic ladder want. The JG proposal
    by contrast is based on several core considerations

    1) it acknowledges what people want and accommodates those needs;

    2) it designs a program that delivers greater macroeconomic stability, and

    3) it helps redefine the meaning and nature of work, helping transform the economy
    to a more just and humane system.

    Work is important for human well-being

    William Mitchell, Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), University of Newcastle, NSW, Australia

    http://bilbo.economicoutlook.net/blog/?p=34412

    “I will argue that basic income proposals:

    1. Have acceded in a most compliant manner to the neo-liberal rationing of work through failed fiscal policies and articulate flawed macroeconomic propositions that are not significantly different to standard neo-liberal ideas about fiscal deficits etc. BIG proponents have thus surrendered the ground on full employment to the neo-liberal requirements that there is a continual buffer stock of unemployed to suppress wages growth and allow capital to access greater shares of real income.

    2. See work in narrow terms – that is, as income earning activity and fail to embrace the reality that work is an integral aspect of our broad well-being. In this sense, the concept of work for basic income proponents is not that much different to mainstream neo-liberal economists who see work as a bad in competition for time with leisure which is a good.

    3. See humans as ‘consumption’ units and the limits of government responsibility to provide some minimal level of consumption to each person. Broader responsibilities that are available to currency-issuing governments in terms of social development and social mobility are denied.

    4. Accordingly, BIG advocates never propose a living income but rather some basic amount to allow a person to eke out some sort of existence without significant chances of achieving any upward mobility. So basic income proponents effectively solidify the existing wealth distribution.

    5. Do not provide any inflation anchor. That is, basic income is not a macroeconomic stability framework. The inflation anchor remains fluctuations in unemployment, which is extremely costly to individuals and society.

    6. Do not provide a dynamic whereby society can have a conversation about the definition of work such that the future challenges of robots and structural change can be addressed by broadening the meaning of productive activity. BIG proponents thus solidify the conventional division between work and non-work."


    Modern Monetary Theory in Canada
    http://mmtincanada.jimdo.com/
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