Wednesday, February 17, 2016

'Basic Income' rears its head again


It seems that Canada's Minister of Families, Children and Social Development is once again pushing the idea of a universal, guaranteed 'Basic Income' for all Canadians.  The Globe and Mail reports:

Veteran economist Jean-Yves Duclos ... told The Globe and Mail the concept has merit as a policy to consider after the government implements more immediate reforms promised during the election campaign.

“There are many different types of guaranteed minimum income. There are many different versions. I’m personally pleased that people are interested in the idea,” said Mr. Duclos, who has a mandate to come up with a Canadian poverty-reduction strategy.

. . .

A minimum or basic income involves a government ensuring everyone receives a minimum income regardless of their employment status.

Interest in the idea of a guaranteed income is heating up since the Finnish government announced last year that it will research and test the concept.

. . .

The general concept is that a guaranteed income would cover basic needs and reduce demand on existing social programs. However, proposals vary widely on whether it should be paired with a drastic reduction in social programs such as welfare and unemployment insurance or complement them.

This means versions of the idea have appeal across the political spectrum, as it could lead to a larger or smaller role for government depending on the model.

. . .

Social- and affordable-housing advocate Stéphan Corriveau ... said ... “The devil’s [in] the details. A guaranteed national income is both a very promising and threatening statement,” he said. “It could be threatening because some of the proposals that are on the table are actually going to diminish the income of the lower-income part of the population and are being used as a way of dismantling the social security net.”

There's more at the link.

Let me say up front that the idea of Basic Income might have value if, and only if, it's used as a way to consolidate many existing welfare and 'entitlement' programs into a single payment.  Used in that way, it could eliminate a great deal of bureaucratic overhead, waste and duplication of effort.  Unfortunately, a government with 'nanny state' or 'Big Brother' tendencies is unlikely to implement it in that way, because it would mean reducing the size of the state and its influence upon society - and what politician wants that?  Therein lies the problem.

The idea of Basic Income is fundamentally socialist.  To cite just one example out of many, Erik Olin Wright, described as an 'analytical Marxist sociologist', wrote a paper titled 'Basic Income as a Socialist Project' (link is to an Adobe Acrobat document in .PDF format).  In another paper (ditto), he links universal basic income (UBI) with so-called 'Stakeholder Grants', and states:  "UBI ... is not ... primarily about social justice as such. It is about creating the conditions under which a stable move toward more equal power within class relations can be achieved."  He's far from alone in viewing Basic Income in that light.  This is a very big stumbling-block for me, because I view socialism as a fundamentally flawed and dishonest policy that has never worked anywhere in the world.  I see little reason why a policy of which it approves (even if it's not actually implemented by socialists) is likely to benefit society.

There's also the question of whether it's moral and/or ethical to pay people for doing nothing - which is one way of looking at Basic Income.  I have a real issue with that from a Christian moral perspective.  As St. Paul put it, "If anyone will not work, neither shall he eat."  Note that this says nothing about someone who cannot work;  only about those who refuse to work.  Those who are disabled or otherwise unable, through no fault of their own, to earn their living, still deserve compassion and support in the light of Christ's teachings.  However, Basic Income does not distinguish between the incapable and the lazy - and that's a moral problem for me.  Nevertheless, the same issue arises with many current welfare and entitlement programs.  If Basic Income can at least reduce the problem, it might be worth considering as a step forward, even if not the ultimate solution.

Finland is preparing an experiment with Basic Income that may be a useful real-world laboratory test to see if it might work.  The libertarian CATO Institute comments:

Finland is moving forward with one of the most extensive and rigorous basic income experiments in decades, which could help answer some of the lingering questions surrounding the basic income. The failures of the current system are well documented, but there are concerns about costs and potential work disincentives with a basic income. Finland’s experiment could prove invaluable in trying to find an answer some of these questions, and whether it is possible some kind of basic income or negative income tax would be a preferable alternative to the tangled web of programs in place now.

. . .

Some aspects of a basic income are intriguing. The current system is deeply flawed, so doing away with the dozens of different government programs and bureaucracies has some appeal. But too many questions remain regarding cost and impact on work incentives. My colleague Michael Tanner explored these issues in depth in his paper earlier this year, and an issue of Cato Unbound allowed proponents and skeptics to suss out the topic.  The Finnish experiments, and similar developments in Switzerland and cities like Utrecht, could help answer some of the many questions raised by a basic income proposal.

Again, more at the link.  The linked issue of Cato Unbound, titled 'The Basic Income and the Welfare State', is also well worth reading if you're interested in the topic.  It explores the topic thoroughly.

Whether we like it or not, the idea of Basic Income is gaining traction in the left-wing and progressive sections of society.  We'd better understand it, in order to (at the very least) offer a reasoned, logical opposition to it . . . and if it has benefits compared to the current tangled web of welfare and entitlement programs, perhaps we should consider it in exchange for killing them off.  The problem then, of course, will be to make sure those other programs don't come back to life!

Peter

24 comments:

Topher_Henry said...
This comment has been removed by the author.
Topher_Henry said...

So, being a big believer myself in the right to "life, liberty, and the PURSUIT of happiness", I definitely am not excited about this idea at all. For someone who believes in the free market as the best overall way to afford people a ladder to climb out of poverty, socialist ideas are not typically well received. I have always detested the idea of wealth redistribution (even when I was eligible to be on the receiving end of that system). This idea is interesting because if it were coupled with killing off a large part of the government bureaucracy and expenditure, it might actually be fiscally advantageous, especially with amount of people in the United States on government assistance. The biggest concern for me would be that people who are working a minimum wage job full time as their living (and are not self-motivated to improve their standing in life) will simply just stop working and collect their check. I would think in order for it to really work there would have to be some type of 'work' component associated with it (for those who were able bodied). There are plenty of public areas that need basic work done (cleaning, sweeping, raking) that people could participate in until they were able to find an actual job. That could help with the laziness aspect of it. What would be funny to me is that, despite this program, I can guarantee that there would still be homeless people. This would drive the SJWs crazy, because they would fail to see that reality that some people just give up and don't care. They would try to say that we 'aren't doing enough, we have to do more!', rather than understanding that some people are so lazy, that they won't even take a walk to get their handout. Very thought provoking, for sure.

WhatIfWeAllCared? said...

I sit on both sides of the coin . . I don't like wealth redistribution and the scourge of people refusing to even try to work. . as I work 48 hours/week and care for a teen son with aspergers alone, I have no sympathy for bums!! On the other hand, I wish there was a program that would allow me to have time to actually provide proper parenting and care to my son . . . not a handout, but help to start my own home business so I can do what is needed . .

WhatIfWeAllCared? said...

I sit on both sides of the coin . . I don't like wealth redistribution and the scourge of people refusing to even try to work. . as I work 48 hours/week and care for a teen son with aspergers alone, I have no sympathy for bums!! On the other hand, I wish there was a program that would allow me to have time to actually provide proper parenting and care to my son . . . not a handout, but help to start my own home business so I can do what is needed . .

tweell said...

The separate little subsidies and programs are done that way to hide the cost and provide more opportunities for graft. Moving to a single subsidy program that would be more visible? Not going to happen, sorry.

Jonathan H said...

I agree with others and am not a big fan of the idea. Beyond that, it isn't really workable either.
There have been serious discussions in Britain about this, as well as some (very limited) trials in India.
The issue that keeps coming up is where to find the money - for examples, budgetary discussions in Britain came down to a monthly 'basic income' of 50 pounds per person replacing ALL other social assistance; in other words, it was essentially useless.
In India, it was tried with just a few very rural, very poor villages, and the monthly income was about $24/ person - it was enough to make a difference there (http://www.guystanding.com/files/documents/Basic_Income_Pilots_in_India_note_for_inaugural.pdf) but that amount of assistance isn't doesn't scale feasibly.
In the United States, if ALL federal spending (about 4 trillion) was converted to a basic income, with no budget for overhead or administration, it would come out to about $12,000 per person per year. In other words, working the job I have now I would get back my taxes as basic income and be back where I started!

raven said...

Some economic experts out there on the left. I can hardly wait for the perpetual motion machine!

This is just another version of their standard redistribution schemes, wrapped up in new paper.

MadMcAl said...

The basic idea as I understand it is that with the increasing automation of the industry there simply are not enough jobs anymore.
At least not jobs for the unskilled masses. If you have 2 people for every job that these people can do the current system is unsustainable.

If you now give a basic income that is just enough to live on (and include some essentials like a TV and a basic computer but no car, no video consoles, no luxuries) and of course basic health care then anybody who wants to do better still can work.
I think it is a long way to go before anybody can build a stable system like that.

Uncle Lar said...

I think Maggie Thatcher said it best:
The problem with socialism is that sooner or later you run out of other people's money.
Or as Ayn Rand pointed out at excruciating great length, eventually the producers get fed up with seeing the results of their labor stolen and given to those who didn't earn it.

WhatIfWeAllCared? said...

Exactly!!

Anonymous said...

I think this is just a trial balloon. The Trudeau Liberals haven't even tabled their first budget yet and they're already projecting a deficit of $10-15B.

In Canada, welfare programs are the provinces' responsibility while disability, unemployment insurance and seniors' pensions in the form of Old Age Security, Guaranteed Income Supplement and the Canada Pension Plan are the federal governments bailiwick. Except that Quebec has its own pension plan and Ontario wants to create a provincial plan too.

Al_in_Ottawa

Stephen J. said...

It seems to me that this is another example of the basic question facing all social support programs: how do you construct a safety net that is strong enough to catch those who fall and need the help getting up, but too weak to support those who simply want to lie down and let others hold them up? And if you can't hit the perfect happy medium, in which direction do you err? Do we accept the freeriders for the sake of helping the genuinely needy, or is the suffering of the unlucky an inevitable cost of the reponsibilities of freedom?

Gorges Smythe said...

Sounds an awful lot like "from each according to his ability, and to each according to his need."

Seneca said...

Sounds like the basic premise for the Havenite empire in the first Honorverse books. It didn't work out too well there for exactly the reasons that ancient world democracies didn't work: People figured out that they could vote themselves an increase in the basic income and, lo and behold they did.

kamas716 said...

There was an experiment done in Canada (Manitoba maybe Saskatchewan?) in the '70's or '80's I think with Guaranteed Basic Income. It didn't run very long, couple of years maybe, and then it got shut down and no one talked about it for decades. A couple of years ago there were noises being made about the data from it finally coming to light, but then all talk about it just disappeared into a black hole again. I'm curious what the data actually said, as the snippets were all positive.

David Lang said...

A couple of examples showing how it could work well

StarShip Troopers, Federal Service was not something you could fail, if you wanted to do it, they would find something for you to do. IIRC "counting caterpillars by touch" if nothing else :-)

As I understand it, prior to WWII, during the Great Depression, there were a huge number of people being paid by the government to do non-critical jobs (going around and interviewing the few remaining Civil War Vets, collecting Genealogies are a couple examples I seem to remember hearing about)

If Basic Income includes a work component that benefits society overall, and encourages people to find things to work on, then it can be a good thing.

If it discourages people from working (because earning money would cause them to loose the basic income), then it's a really bad thing.

Will said...

A study of human nature says it cannot work as people would wish it to.
I forget which Scandinavian country tried something similar with a version of socialism. It worked at first, since they were very strict in morals, but as time went along, and technology improved, the number of people who started to avail themselves of the handouts climbed noticeably. IIRC, they are approaching a financial cost that will be crippling tax-wise.

The apparent problem seems to be that when it is controlled by a govt, there is no way to limit fraud, waste, and cost without a moral citizenship involved. We are long past that point in Western Civilization!

JK Brown said...

First they provide for the people's sustenance, but then what is "basic". Look at what is considered "right" and proper for the welfare recipient now. A lot are supposedly provided the basics, but those "basics" are more than the working person can afford for themselves. And what is to be done with the individual who wishes to invest in productive capital to better their family's condition?



"First, what is the best the socialists, in their writings, can offer us? What do the most optimistic of them say? That our subsistence will be guaranteed, while we work; that some of us, the best of us, may earn a surplus above what is actually necessary for our subsistence; and that surplus, like a good child, we may "keep to spend." We may not use it to better our condition, we may not, if a fisherman, buy another boat with it, if a farmer, another field ; we may not invest it, or use it productively ; but we can spend it like the good child, on candy — on something we consume, or waste it, or throw it away.

"Could not the African slave do as much? In fact, is not this whole position exactly that of the negro slave? He, too, was guaranteed his sustenance; he, too, was allowed to keep and spend the extra money he made by working overtime; but he was not allowed to better his condition, to engage in trade, to invest it, to change his lot in life. Precisely what makes a slave is that he is allowed no use of productive capital to make wealth on his own account. The only difference is that under socialism, I may not be compelled to labor (I don't even know as to that — socialists differ on the point), actually compelled, by the lash, or any other force than hunger. And the only other difference is that the negro slave was under the orders of one man, while the subject of socialism will be under the orders of a committee of ward heelers. You will say, the slave could not choose his master, but we shall elect the ward politician. So we do now. Will that help much? Suppose the man with a grievance didn't vote for him?"

--“Socialism; a speech delivered in Faneuil hall, February 7th, 1903, by Frederic J. Stimson

And remember, Social Security was sold originally as providing a basic income to retirees, yet it has grown and many demand its increase to cover the manner to which they've become accustomed.

Tirno said...

The fundamental problem of these basic living wage proposals is that they all have the underlying premise of promising something for nothing. Well, nothing except voting for the politician that promises to deliver it.

As Alexander Tytler (allegedly) said, "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship, then a monarchy."

If this comes to pass, I suggest that the recipients do have the pay for it: with their right to vote for the government that provides it. Not permanently, but you'd have to be off this welfare for a year before you can vote again. Otherwise, we end up with the problem of people voting themselves a living. If there is no pressure to get off welfare, there is a substantial population that will not. We have seen generation after generation of welfare recipients because that's what the parents settle for, and the children are raised to see that as some kind of normal.

This would not, of course, have any implications for private charity. Any kind of assistance that is not backed up by the power of tax collectors is a result of the charity and mercy of the donors. I find public charity to be anti-virtuous on many levels, from the undiscriminating promotion of sloth and envy in the recipients, to the false sense of virtue from the rob-Peter-to-pay-Paul supporters, to the calculating advantage garnered by the politican, to the crowding out of the capacity of individual to express their charity.

Jason said...

A de facto guaranteed basic income exists in Britain and parts of the U.S. To see the effects of giving people other people's money simply for existing, one can read either _Life at the Bottom_ by Theodore Dalrymple, or Mark Steyn's "Preserving Their Way of Life" (my link to which has, alas, suffered link-rot).

Lotus Eaters Apathy is the polite description of the results. In religious terms, a guaranteed/universal basic income amounts to a subsidy for Original Sin. In more secular terms, people are intrinsically lazy and selfish, and will, more often than not, choose the easiest way to get what they want. Make work unnecessary and they'll stop doing it. The time they don't spend working will then be spent on self-indulgence. That usually means sex, drugs, and violence.

It's not a pretty picture.

A.B. Prosper said...

Basic Income is probably better than the welfare state or outright Communism and cheaper to administer but its not doable with basically any immigration.

However its going to come to weighing the downsides, the effects on work ethic and the effects of idleness on the culture against the fact that demand starvation and wage arbitrage are killing the economy.

Automation is a huge part of this, the Craigslist problem, CL creates 30 jobs costs 30,000 jobs and while its not as dramatic everywhere huge tiers of middlemen are gone , most of the people in the CD production sector of music industry , the travel planning business, accountants, you name it

What jobs do remain are low paying, typically 12-15 US

Th net result of this has been a vast growth of the State, its now 40% of the economy . This a natural reaction from people and no amount of moral prating will change it. Everyone votes with their stomach and if the private sector won't do, the public will

Speaking for the US only, wages have declined by about half of GDP since the early 70's which in real terms means American workers make half what they did in the same period. Woman in the workforce, single moms all that do contribute but mus of it technologically driven

Fertility rates are on par with the Great Depression and family formation is at an all time low. Some of this is cultural to be sure but economic prospects play a huge role enough that even Hispanics are suffering low fertility rates


And while yes some things are cheaper, this doesn't help keep many business working

So we have a few choices , we can allow everything to fall apart, default and deflate and hopefully the USD will recover from its "nearly everywhere is Flint Michigan meets Yugoslavia stage" or we can find some way to prop it up

I can't see us easily rebooting a healthy family structure and basically doing all the things required to make wages grow (expel immigrants, force the work week down to 30, discourage female employment, tax automation) or even if we did making it last long, as such we'd be better off finding some way to make things work

Make work is stupid, simply put there isn't enough to do for 50-70 million people, no CCC will work assuming they can get past the resentment and even if we inculcate them to work, the private sector has no use for them. We don't have shovel ready jobs, we have bulldozers .

This isn't Christendom anyway and we can't enforce a lot of those moral edicts or values anyway

We could simply remove all supports but this will guarantee by force if needed our neat leaders will make Bernie Sanders look like Ayn Rand

This leaves us with some kind of welfare state, the cheapest and simplest is basic income. Its sucks yes but is still better than the alternatives

Now we aren't going to get there for some time, immigration will have to be dealt with first and the US will also try a few Republicans beforehand but either it or Social Democracy are almost certainly baring Civil War in the future

Anonymous said...

Here in Germany, guaranteed basic income is already implemented for millions -- of illegal migrants, that is. All they need to do is walk across the borders without personal identification, claim they are from "Syria", and they will housed, clothed, and fed, plus free medical care, plus 143 euros spending money every month, until their asylum application can be received, processed, and decided on... which will be three years. When, eventually, it turns out they are really from somewhere else, years more filing appeals against the deportation order, still on the taxpayers' dime.

Meanwhile, citizens work, sleep, get up, work, pay taxes... no guaranteed basic income for them, no sir.

A.B. Prosper said...

12:48 if you don't like it and your elections can't solve it doesn't leave many options does it?

Y'all are going to have to get rid of your political class, either by voting them out, infiltrating the parties or heaven forbid ,other means.

In any case it would be wise to cultivate a taste for power, you'll need to use it.

Happily for us folks of German stock its easy and in the blood. ;)

An old joke here in the US goes "I hate at a German/Chinese restaurant a while back. A couple of hours later I was hungry for power"

The US needs to do a lot of house cleaning too . We are trying Trump who is suspect if he wins will fail. That however will tell Americans ain't no political solutions left and we'll go from there,

We have a lot of guns, a lot of people getting trained and a lot of itch itchy trigger fingers. You can see where that might lead.

What you guys have that we don't is a sense of identity and the ability to work collectively. That will serve you better than guns in many ways and if you like us Americans can decide on an alternate model, you may find it simpler to implement and might even manage to do it without resorting to more unpleasant matters .

Would that be the case for both of us. Good luck and take care.

Jacquejet said...

David Weber's BLS (basic living stipend) has arrived. Next, Canada will change it's name to the People's Republic of Haven and Honor Harrington will go to war.