Universal basic income: pipedream or a real possibility?   

Universal basic income: pipedream or a real possibility?  

Amy Downes and Stewart Lansley

During a recent Guardian newspaper podcast on the idea of a universal basic income, one of the contributors declared that the debate on the issue was ‘fading’. The idea of a universal basic income (UBI) certainly divides opinion. While advocates believe that it would be a springboard for progressive change, some social policy experts are hostile. So is UBI, as Anke Hessel has put it, a ‘dead end’?[1] Or is it the big idea that could contribute to the building of a fairer and more secure society?

A universal basic income would pay every individual, as of right, a tax-free, unconditional and non-contributory weekly income, irrespective of how much they earned or their work status. Aimed at guaranteeing a no-strings-attached minimum secure income for all, whatever their circumstances, a UBI would reinforce the existing social security system and involve a profound revolution in the way income support is organised.

A few years ago, the idea of a universal basic income was widely dismissed as eccentric. Today, far from fading away, the idea is enjoying a significant, and mostly unpredicted, global momentum.  The current surge of interest follows a number of waves of support over the last century. The first came after the First World War when several UK thinkers called for some version of a basic income as a way of tackling the severe economic insecurity of the inter-war years. The next wave came in the second half of the 1960s in response to the call in the United States for a negative income tax system by the pro-market economist Milton Friedman. The third wave followed the 1986 formation of the cross-European (and later cross-world) network of supporters – BIEN (the Basic Income Earth Network) – that helped to build a basic income movement that spanned countries.

The recent revival of this long debated idea can be attributed to a number of factors from concerns about the disruptive impact of the new machine age and the growth of more fragile economies to the rise of institutionalised inequality and the increasing inadequacy of modern social security systems to deal with these growing risks.

However, a UBI is not just about finding a practical solution to the rise of precarity and accelerating automation. Key to the growth of interest is the way a UBI would transform the nature of choice. A UBI is non-prescriptive: it would offer people greater flexibility between work, leisure (and let’s not confuse leisure with idleness), education and caring. It offers everyone greater freedom and autonomy, progressive changes with transformative potential.

Some might choose to work less or take longer breaks between jobs. Others would be incentivised to start businesses. Some might take time to retrain, while others might devote more time to leisure, personal care or community support. Such a boost to choice has the potential to produce more social value, if currently unrecognised, than some paid work. Implicit to the idea is that all lifestyle choices would be equally valued. A UBI would value but not over-value work.

The momentum behind the idea can be seen in the launch of basic income trials, of varying forms and ambition, in a number of countries – from Finland, Canada and the Netherlands to the USA, Kenya, Brazil and Uganda. Some of these have been funded by national governments, and others by crowd-funding charities (such as Eight and GiveDirectly) and wealthy industrialists (such as the Californian scheme by Y Combinator), while all offer very different designs.

Following this lead, several other countries are considering joining the ‘trial club’. The Scottish government, for example, has promised funding for feasibility work with 4 possible towns, including Fife and Glasgow. While the full impact of these pilots will not be known for some years, they are having a galvanising effect on the UBI debate.

Despite the scepticism of critics, the flame of the UBI movement will continue to burn for a while.  Indeed, the debate about UBI has in many ways moved on from questions of desirability to those of feasibility: is it affordable, can it work in practice, would it deliver on its promise to reduce poverty and inequality?

Even the idea’s sternest opponents acknowledge UBI’s merits: that it would provide, for the first time, a guaranteed, if modest, income floor; that it would be a charter for freedom and choice; that it would bring financial support for the mass of unpaid work from childcare to voluntary help disproportionately undertaken by women; and would remove some of the negative elements of the current intrusive and punitive system of social security.

Despite these merits, critics maintain that it is not affordable.  As The Independent online has put it, ‘the utopia it promises is a deceit’. An affordable UBI, it is claimed, would not pay enough to be worth the bother of change while one that paid a decent rate would be much too expensive.

However, such criticisms are mostly directed at a particular model of UBI – a ‘big bang`, all singing all dancing approach based on generous payments and the sweeping-away of most of the existing system. Simulations have shown that such a model would indeed be prohibitively expensive, with some of the poorest amongst the losers. However, the same simulations have shown that a more modest scheme that paid initially lower levels of payment and that is grafted onto the existing system, leaving much of it intact, at least initially, would have positive outcomes. It would be highly progressive, reduce child poverty and dependency on means testing, and offer a more robust safety net in today’s more precarious times while putting an end to sanctions.[2]

There is now a growing acceptance amongst supporters that successful implementation would require an incremental and staged approach to reform. This may mean, as one advocate of a full blooded approach has put it, ‘thinking small’, but this approach could then build to a stronger system over time as resources allowed. Such a scheme is not a silver bullet. It cannot alone deal with the multiple fault lines of today’s economic and social systems. Nevertheless, a modified UBI would involve a major improvement in the nature of social protection.

Many of the issues facing the UBI question – Is it too expensive? What will the trials reveal? Is gradualism the way forward? Would the public buy-in?  – continue to be hotly debated. All of them are discussed in a new book, It’s Basic Income: The Global Debate, which brings together contributions from five continents and fifteen countries, from Finland, France, Denmark and the UK to India, Canada, Kenya and the USA.

In the book, practitioners, thinkers, artists and writers – a mix of protagonists, dissenters and recent converts – debate the history, the lessons from past experiments, the potential of the current trials and what UBI means for them.

The outcome of the trials will have a huge impact on what happens next. The idea is capturing imaginations across a great diversity of nations, and amongst its citizens, and with the emergence of national campaigns, its global support base is growing. Former doubters have signed up to the idea while other recent recruits include the 2010 Nobel laureates in economics, MIT’s Peter Diamond and LSE’s Sir Christopher Pissarides. With the status quo unsustainable, this current wave of interest, the fourth over the last century, feels more grounded than the earlier phases, and significantly, more global. There are no signs that the current wave of interest is about to ‘subside’, as was the case in the earlier ones.

With citizens across nations losing patience with existing systems of social protection, it is doubtful that the status quo can hold for long. There is growing concern with inequality, the future of work and the risks that they bring. People want and are demanding better choices. Although the case for a UBI has been driven by the promise of greater security for households, it has the potential to contribute to other key progressive goals from greater social justice to the encouragement of more active social participation. As Roope Mokka and Katariina Rantanen from the think tank Demos Helsinki argue in the book, a UBI for the post-industrial age offers much more than a simple ‘employment fix’ and could ‘help to create no less than a shared political vision for a future society’.

Notes:
[1] Anke Hessel, ‘Unconditional  Basic Income is a Dead End`, in A Downes and S Lansley ( Eds ), It’s Basic Income, The Global Debate, Policy Press, 2018.
[2] H Reed and S Lansley, ( 2016 ), Universal Basic Income: An Idea Whose Time Has Come?

 

Stewart Lansley is an economist and financial journalist. He is a visiting fellow at the School of Policy Studies, University of Bristol and a fellow at London’s City University. He has written on inequality, wealth and poverty for academic and specialist journals as well as several newspapers. He is the author of a number of books including A Sharing Economy (2016), Breadline Britain (with Joanna Mack, 2015). Amy Downes is the Co-founder of Work till Late design studio and communications consultancy. Her interest in the topic of Basic Income stems from her time studying philosophy,and social justice and welfare. They are are co-editors of It’s Basic Income, The Global Debate, Policy Press, March , 2018

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