In 1516, the English scholar Thomas More published Utopia, a political satire depicting an island where conditions were as they “should be”. In it, he made the first reference to an idea that is now being debated and tested across the world. Every citizen on More’s island (which, it should be pointed out, also featured slaves shackled in chains of gold) is provided with “some means of livelihood”. They are granted, in effect, a universal basic income, or UBI.
What is universal basic income (UBI)?
In its fundamental form, UBI hasn’t changed much from More’s original proposition. The idea is to give every citizen, regardless of means, a sum of money, regularly and for life – usually enough that they don’t need to work. (The amount of money, and so the level of a citizen’s income security, can vary wildly, but more on that later).
“Basic income is the idea that, usually to replace other existing social security benefits, everyone receives uniform, flat-rate payments,” says Luke Martinelli, a research associate at the University of Bath. “The motivation for that is to reduce the reliance on other benefits by providing a fairly modest income floor.”
Jamie Cooke, head of RSA Scotland, offers a more specific definition: “Basic income is regular and secure payments directly to every individual within a country, which comes from the state, and I think it has to have certain core elements to it – it is universal, it is unconditional, and it is regular, secure and direct.”
UBI’s proponents are international and politically diverse. They range from radical leftists of the post-capitalist variety like Paul Mason or Aaron Bastani, to Silicon Valley gurus like Elon Musk and Mark Zuckerberg. “It’s really fascinating how an international conversation this is,” says Cooke. “I did a session last week for a group in Ontario, there’s one for the World Congress in India this week, and, watching [US Democratic presidential hopeful] Andrew Yang’s campaign, it’s been fascinating to see how far up the chain he’s got the discussion on UBI.”
In May the economist Guy Standing presented a report outlining a proposal for UBI to no less than the shadow chancellor of the exchequer, John McDonnell.
Why’s everyone interested in UBI now?
A veritable smorgasbord of reasons. The generally dire and unfair state of high-income economies is one. As economist Branko Milanovic has shown, inequality has been rising steadily within these countries – defined by the World Bank as a country with a gross national income per capita of $12,376 (£10,100) or more – since the 1980s. The income of these countries’ middle and lower-middle classes has stagnated; the richest one per cent have seen a wealth increase, earning twice as much as the bottom 50 per cent.
“In Scotland, it’s very much been driven from a social justice perspective,” says Cooke. “So it’s an idea concerning how people engage in a more fair way, [and] share more in society – how we acknowledge the kind of common good and shared resources that we have.”
Then there are more specific criticisms of the provisions UBI would seek to supplement or replace: means-tested benefits, it is argued, essentially discourage and penalise people from earning more money and returning to work. The recognition of unpaid, usually female labour like caring for the elderly and housework, is also a factor.
There are proposed public health benefits, too. Martinelli points to a study in Canada where hospitalisations and mental health problems were alleviated by increased income security. People might work for enjoyment, rather than survival: “It would theoretically allow people to take risks,” says Martinelli. “To go back to retrain or re-educate, to have a career break – these are positive productivity-enhancing changes.”
Other arguments fall in the “robots are coming for our jobs” category. “In the US, there’s been a push from the perspective of artificial intelligence, automation, the impact of this is going to have on jobs,” says Cooke. “That’s partly why you’re seeing so much interesting support from some of the entrepreneurs. To be brutally honest, there’s an element of self-preservation: they’re concerned that they’re going to impact on jobs, and people with pitchforks might turn at their front door.”
Even the environment might benefit, says Mark Maslin, professor of Earth System Science at UCL, because when we work less we consume less: “we are convinced [UBI] will cut down on consumption and poor environmental practices.”
So UBI’s proponents all agree?
No. One of the major problems with UBI is what it actually entails in its specifics. “It can mean anything to anyone,” says Anna Coote, a principal fellow at the New Economics Foundation, and a strong opponent.
This vagueness makes finding unity in proposals difficult. “The suggestion that UBI has broad support actually breaks down when you start looking at what those different views actually want,” says Martinelli. “And the idea that you can get all of the goals within a single scheme breaks down as well.”
Though divisions run deeper than political orientation, its helpful to break UBI down into differences between right and left – the specifics and motivations of the two camps vary wildly.
What’s the right-wing version then?
Modern interest in UBI actually begins on the right, with Anglo-Austrian economist Friedrich Hayek, who argued for a “certain minimum income for everyone… a floor below which nobody need fall even when he is unable to provide for himself.”
This conservative attraction to UBI is broadly libertarian, as Sam Bowman, of the Adam Smith Institute, explained in 2013: “The ideal welfare system is a basic income, replacing the existing anti-poverty programmes the government carries out.” In these understandings, a paternalistic state is an unjustifiable restriction on a citizen’s freedom. It must be shrunk – its train of invasive, illegitimate welfare provisions and public services swept away. In its place, the citizen is set free – here’s your cash, go get busy.
Needless to say, this view provokes some rancour among progressives. “There are variations of basic income, even with all the work I do on it, [which] I would fight against tooth and nail,” says Cooke.
“This argument is preferred by the Silicon Valley gurus,” Coote says. “They want people to have just enough money so they can go shopping and buy their goods and not riot in the streets, but they don’t want social progress – UBI is attractive to them.”
The basic criticism of UBI in this form is that it is heartlessly cruel, as John Lanchester articulated in the London Review of Books, “A few seconds’ thought will show that this is a dystopian, even nightmarish vision of a state which has retreated from many of its core functions and, faced with its citizens’ needs, taken up the posture of a permanent shrug.”
What’s the left suggesting?
The progressive version of UBI usually involves its being paid on top of existing citizens benefits.
The most talked-about of these experiments took place in Finland, by the Social Insurance Institution Kela. From January 2017 until December 2018, two thousand unemployed, randomly-selected citizens were given a monthly flat payment of €560 (£490).
This was a very low sum, explains Miska Simanainen, a researcher at Kela. “This is equal to the minimum unemployment benefit in Finland – if you were getting earning-related benefits, then your income was much, much higher.” One of the key aims of the study was to find out whether UBI affects a person’s motivation to work.
So, how did the Finnish experiment go? “The main results related to employment and income was that nothing really happened during the first year of the experiment,” Simanainen says. Basically, people with UBI didn’t go and find jobs. Wellbeing may well have raised – the treatment group were happier and less stressed – though Simanainen emphasizes that evaluation is ongoing.
The RSA has also modeled several UBI schemes in Scotland, as replacements for social security (Cooke emphasises that housing and disability benefits would stay the same). One, a basic income of about £2,400 per person a year, would cost £2billion a year to implement. The other, a basic income of about £4,800 per person a year, would cost £9.5billion. The RSA found that the former would reduce relative household poverty by 8.5 per cent, the latter by 33 per cent.
So what are the criticisms?
There are quite a few. “The idea that people will quit the labour markets is one, the idea that we’d be better to target the poor is another,” says Martinelli. “Then there’s the moral argument that it’s not fair to let people ‘scrounge’, and I guess the flip side of that is that if you give people income which is unconditional, you’re not actively helping them to integrate in society – you’re basically encouraging them to drop out.” (Related to this concern is a worry about how people will actually spend the money – does the state not have a responsibility to curb substance abuse, for instance?)
Coote also has serious qualms with the idea that any of these studies have worked in any financially viable sense. “Please don’t say there is evidence that it works – it doesn’t,” she says. “This is one of the most dishonest claims of some of its advocates: they say ‘it’s been trialed, it’s been shown to work’. I have done a thorough review of all the trials that there is literature on, and there is no evidence to show that you UBI could work in its fully developed form – if you look at the evaluation in India for example – it says it’ll only work if you’ve got public services.”
Coote explains that the real issue here is funding. There is no evidence, in her view, that you can have a generous welfare state and solid social infrastructure alongside “full fat” – i.e. giving out enough money to live on – UBI. Pushing for UBI, in this sense, is doing the right’s job for them – it’s only viable if we decimate the public sector. “It gives a huge amount of power to those funding it, whether it’s the NGOs or the government”, says Coote. “It’s in the hands of a single lever, whereas with services, which is what I think we should be focusing on, they are collective, they are democratic, and more diffused – far more difficult to turn off in a single switch.”
Cooke acknowledges this fear, but disagrees. “I understand the desire to protect the public sector,” he says. “But I think arguing that there’s not enough money plays very strongly to the very people who are trying to undermine the public sector – they’ll just say there’s not enough money to keep doing what we are doing.”
We need to be more creative in our approach to generating revenue, he says, looking beyond just income tax. “Data is the biggest resource of the 21st century and currently has no social benefit – there ways that we can start to look at that that could have a significant impact on revenue generation.”
What’s the bottom line then?
The bottom line is that, though UBI remains popular, paying for it continues to be its fundamental sticking point. “What crosses the right and the left is that it is a waste of money,” says Martinelli. “Either you think that that money will be best spent other ways, i.e. more specifically targeting the poor, or you think it shouldn’t be taxed and it should be left in people’s pocket. The question is, for all the expense and all the effort that would be involved in UBI – does it really do enough? Is it worth it? I think that’s definitely not clear.”
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