Basic income
Encyclopedia
A basic income guarantee (or basic income) is a proposed system of social security
, that regularly provides each citizen with a sum of money. In contrast to income redistribution between nation
s themselves, the phrase basic income defines payments to individuals rather than households, groups, or nations, in order to provide for individual basic human needs. Except for citizenship
, a basic income is entirely unconditional. Furthermore, there is no means test
; the richest as well as the poorest citizens would receive it. The U.S. Basic Income Network emphasizes this absence of means testing in its precise definition, "The Basic Income Guarantee is an unconditional, government-insured guarantee that all citizens will have enough income to meet their basic needs."
In everyday usage, the phrase basic income is often inaccurately conflated with means test
ed guaranteed minimum income
alternatives such as a negative income tax
. A basic income of any amount less than the social minimum is referred to as a partial basic income.
Similar proposals for "capital grants provided at the age of majority" date to Thomas Paine's
Agrarian Justice
of 1795, there paired with asset-based egalitarianism
.
and Philosopher André Gorz
:
The Basic Income Earth Network
(BIEN) describes one of the benefits of a basic income as having a lower overall cost than that of the current means-tested social welfare benefits. However critics have pointed out the potential work disincentives created by such a program, and have cast doubts over its ability to be implemented. In later years, BIEN has made several fully financed proposals.
has a system
which provides each citizen with a share of the state's oil revenues, although this amount is not necessarily enough to live on. The Alaska Basic Income is subject to Income Tax on Federal level. That way the "Basic Income" works like a Negative Income Tax
but with a "prebate" instead of a "rebate" (as far as state finances are concerned).
The U.S. also has an Earned income tax credit
for low-income taxpayers. In 2006 a bill written by members of the advocacy organization USBIG to transform the credit into a partial basic income was introduced in the US Congress but did not pass.
The city of Dauphin, Manitoba
, Canada took part in an experimental basic income program ("Mincome
") between 1974 and 1979.
In 2008, a pilot project with a basic income grant was started in the Namibia
n village of Omitara
by the Namibian Basic Income Grant Coalition. After six months the project has been found to significantly reduce child malnutrition and increase school attendance. It was also found to increase the community's income significantly above the actual amount from the grants as it allowed citizens to partake in more productive economic activities.
, who came to the conclusion that as the productive forces
increased, along with automated production, the need for unskilled labor would diminish, eventually leading to a situation in which work would be divided among all members of society (solving the issue of unemployment in capitalism) as it is gradually reduced, emancipating labor from the need to engage in long and alienating work. Marx referred to this stage as Upper-stage communism, where goods and services (rather than income) would be provided free of charge. Other socialist authors, such as Bertrand Russell
, envisioned four-hour workdays in a future socialist society.
Many of the following advocates have actually proposed a negative income tax
, which is means tested, rather than a basic income. Despite their differences in administration and effect, the two proposals are usually conflated.
Many countries have political parties that advocate a basic income, such as the Green Party of the United States, Green Party of Canada
, Green Party of England and Wales
, Vivant
(Belgium), De Groenen
and GreenLeft
(The Netherlands), the Scottish Green Party
, Socialist Party of South Korea, the New Zealand Democratic Party
, the Liberal Party of Norway, Norwegian Green Party and Norwegian Red Party and the Workers' Party (Brazil)
, New Party Nippon
(Japan), Greens Japan as well as the Pirate Party Germany.
Worldwide, supporters of a basic income have united in the Basic Income Earth Network
. BIEN recognizes numerous national advocacy groups.
One of the world's outspoken advocates of a basic income system is the Belgian
philosopher and political economist Philippe van Parijs
.. Other advocates include Gunnar Adler-Karlsson (Sweden), Götz Werner
(Germany), Saar Boerlage (Netherlands), Herwig Büchele (Austria), André Gorz
(France), Michael Hardt
and Antonio Negri
, Charles Murray
(USA), Keith Rankin (New Zealand), Daniel Raventós (Spain), Osmo Soininvaara
(Finland), Guy Standing (UK), Eduardo Suplicy
(Brazil) and Walter van Trier (Belgium)
In 1968, James Tobin
, Paul Samuelson
, John Kenneth Galbraith
and another 1,200 economists signed a document calling for the US Congress to introduce in that year a system of income guarantees and supplements.
In the 1972 presidential campaign, Senator George McGovern
called for a 'demogrant' that was very similar to a basic income.
In 1973, Daniel Patrick Moynihan
wrote The Politics of a Guaranteed Income (ISBN 0394463544) in which he advocated for the Basic Income and discussed Richard Nixon's
GAI proposal.
Mike Gravel
, a former US congressman and presidential candidate, advocates a tax rebate paid in a monthly check from the government to all citizens as part of a transition away from income taxes and toward a pre-bated national sales tax (the FairTax
).
Winners of the Nobel Prize in Economics who fully support a basic income include Herbert Simon
, Friedrich Hayek
, James Meade
, Robert Solow
, and Milton Friedman
.
In his final book Full employment regained? James Meade states that a return to full employment
can be achieved only if, among other things, workers offer their services at a low enough price, that the required wage for unskilled labour would be too low to generate a socially desirable distribution of income, and that therefore a citizen's income would be necessary.
Erik Olin Wright characterizes basic income as a socialist project and a further reform to capitalism that establishes the basis of a social economy by empowering labor in relation to capital.
Richard Parncutt argues that income tax is effectively progressive when basic income is combined with flat income tax. The combination would radically simplify the tax-welfare system, enabling voters to support policies that truly serve their personal interest and strengthen the entire economy, leading to elimination of poverty.
In his Robotic Nation essays, Marshall Brain
argues that the growing amount of automation in the workplace will eventually displace a large percentage of workers, and that in order to be able to maintain the economy, an annual stipend will be needed. A similar argument was made by Jeremy Rifkin
, in his book The End of Work
.
Martin Ford in The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future (free PDF available) , argues that most routine jobs in the economy will ultimately be automated via advancing technologies such as robotics and artificial intelligence and that, without a basic guaranteed income, this will cause a drastic decline in consumer demand and confidence, possibly precipitating a major economic crisis. Ford further argues that the level of the basic income should vary based on incentives such as the pursuit of higher education, or behaviours that benefit the community or the environment.
The Natural Governance Philosophy expands on the justification for basic income beyond its survival income purpose. The default use of tax revenue should be an egalitarian cash dividend to citizens, and the alternative to the cost of any social (government) program should be an egalitarian dividend to all social citizens. Only if a majority prefers spending for the program compared to receiving their share of the cash costs of the program, should that program be funded.
However, in studies of the Mincome experiment in rural Manitoba, the only two groups who worked less in a significant way were new mothers, and teenagers working to support their families. New mothers spent this time with their infant children, and working teenagers put significant additional time into their schooling. Under Mincome, "the reduction of work effort was modest: about one per cent for men, three per cent for wives, and five per cent for unmarried women."
Social security
Social security is primarily a social insurance program providing social protection or protection against socially recognized conditions, including poverty, old age, disability, unemployment and others. Social security may refer to:...
, that regularly provides each citizen with a sum of money. In contrast to income redistribution between nation
Nation
A nation may refer to a community of people who share a common language, culture, ethnicity, descent, and/or history. In this definition, a nation has no physical borders. However, it can also refer to people who share a common territory and government irrespective of their ethnic make-up...
s themselves, the phrase basic income defines payments to individuals rather than households, groups, or nations, in order to provide for individual basic human needs. Except for citizenship
Citizenship
Citizenship is the state of being a citizen of a particular social, political, national, or human resource community. Citizenship status, under social contract theory, carries with it both rights and responsibilities...
, a basic income is entirely unconditional. Furthermore, there is no means test
Means test
A means test is a determination of whether an individual or family is eligible for help from the government.- Canada :In Canada means tests are used for student finance , and "welfare" . They are not generally used for primary education and secondary education which are tax-funded...
; the richest as well as the poorest citizens would receive it. The U.S. Basic Income Network emphasizes this absence of means testing in its precise definition, "The Basic Income Guarantee is an unconditional, government-insured guarantee that all citizens will have enough income to meet their basic needs."
In everyday usage, the phrase basic income is often inaccurately conflated with means test
Means test
A means test is a determination of whether an individual or family is eligible for help from the government.- Canada :In Canada means tests are used for student finance , and "welfare" . They are not generally used for primary education and secondary education which are tax-funded...
ed guaranteed minimum income
Guaranteed minimum income
Guaranteed minimum income is a system of social welfare provision that guarantees that all citizens or families have an income sufficient to live on, provided they meet certain conditions. Eligibility is typically determined by citizenship, a means test and either availability for the labour...
alternatives such as a negative income tax
Negative income tax
In economics, a negative income tax is a progressive income tax system where people earning below a certain amount receive supplemental pay from the government instead of paying taxes to the government. Such a system has been discussed by economists but never fully implemented...
. A basic income of any amount less than the social minimum is referred to as a partial basic income.
Similar proposals for "capital grants provided at the age of majority" date to Thomas Paine's
Thomas Paine
Thomas "Tom" Paine was an English author, pamphleteer, radical, inventor, intellectual, revolutionary, and one of the Founding Fathers of the United States...
Agrarian Justice
Agrarian Justice
Agrarian Justice is the title of a pamphlet written by Thomas Paine, published in 1797, which advocated the use of an estate tax and a tax on land values to fund a universal old-age and disability pension, as well as a fixed sum to be paid to all citizens on reaching maturity...
of 1795, there paired with asset-based egalitarianism
Asset-based egalitarianism
Asset-based egalitarianism is a form of egalitarianism which theorises that equality is possible by a redistribution of resources, usually in the form of a capital grant provided at the age of majority...
.
Arguments
One of the arguments for a basic income was articulated by the French EconomistEconomist
An economist is a professional in the social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...
and Philosopher André Gorz
André Gorz
André Gorz , pen name of Gérard Horst, born Gerhard Hirsch, also known by his pen name Michel Bosquet, was an Austrian and French social philosopher. Also a journalist, he co-founded Le Nouvel Observateur weekly in 1964...
:
The Basic Income Earth Network
Basic Income Earth Network
The Basic Income Earth Network is a network of academics and activists interested in the idea of a universal basic income, i.e. a guaranteed minimum income based solely on citizenship and not on work requirement or charity...
(BIEN) describes one of the benefits of a basic income as having a lower overall cost than that of the current means-tested social welfare benefits. However critics have pointed out the potential work disincentives created by such a program, and have cast doubts over its ability to be implemented. In later years, BIEN has made several fully financed proposals.
Examples of implementation
The U.S. State of AlaskaAlaska
Alaska is the largest state in the United States by area. It is situated in the northwest extremity of the North American continent, with Canada to the east, the Arctic Ocean to the north, and the Pacific Ocean to the west and south, with Russia further west across the Bering Strait...
has a system
Alaska Permanent Fund
The Alaska Permanent Fund is a constitutionally established permanent fund, managed by a semi-independent corporation, established by Alaska in 1976, primarily by the efforts of then Governor Jay Hammond...
which provides each citizen with a share of the state's oil revenues, although this amount is not necessarily enough to live on. The Alaska Basic Income is subject to Income Tax on Federal level. That way the "Basic Income" works like a Negative Income Tax
Negative income tax
In economics, a negative income tax is a progressive income tax system where people earning below a certain amount receive supplemental pay from the government instead of paying taxes to the government. Such a system has been discussed by economists but never fully implemented...
but with a "prebate" instead of a "rebate" (as far as state finances are concerned).
The U.S. also has an Earned income tax credit
Earned income tax credit
The United States federal earned income tax credit or earned income credit is a refundable tax credit primarily for individuals and families who have low to moderate earned income. Greater tax credit is given to those who also have qualifying children...
for low-income taxpayers. In 2006 a bill written by members of the advocacy organization USBIG to transform the credit into a partial basic income was introduced in the US Congress but did not pass.
The city of Dauphin, Manitoba
Dauphin, Manitoba
Dauphin is a small city in Manitoba, Canada, with a population of 7,906 as of 2006. The nearby lake was given the name "Dauphin" by the explorer Pierre Gaultier de Varennes, sieur de La Vérendrye in 1741 in honour of the heir to the French throne...
, Canada took part in an experimental basic income program ("Mincome
Mincome
Mincome is the name of an experimental Canadian Basic income project that was held in Dauphin, Manitoba during the 1970s. The project, funded jointly by the Manitoba provincial government and the Canadian federal government, began with a news release on February 22, 1974, and was closed down in 1979...
") between 1974 and 1979.
In 2008, a pilot project with a basic income grant was started in the Namibia
Namibia
Namibia, officially the Republic of Namibia , is a country in southern Africa whose western border is the Atlantic Ocean. It shares land borders with Angola and Zambia to the north, Botswana to the east and South Africa to the south and east. It gained independence from South Africa on 21 March...
n village of Omitara
Omitara
Omitara is a settlement in the Steinhausen electoral constituency in the Omaheke Region of Namibia. Together with the adjacent village of Otjivero — the two places are often referred to as one — it has a population of approximately 1,200 as of October 2008...
by the Namibian Basic Income Grant Coalition. After six months the project has been found to significantly reduce child malnutrition and increase school attendance. It was also found to increase the community's income significantly above the actual amount from the grants as it allowed citizens to partake in more productive economic activities.
Advocates
The concept of basic, or guaranteed income in the form of social provision, was foreshadowed by Karl MarxKarl Marx
Karl Heinrich Marx was a German philosopher, economist, sociologist, historian, journalist, and revolutionary socialist. His ideas played a significant role in the development of social science and the socialist political movement...
, who came to the conclusion that as the productive forces
Productive forces
Productive forces, "productive powers" or "forces of production" [in German, Produktivkräfte] is a central idea in Marxism and historical materialism....
increased, along with automated production, the need for unskilled labor would diminish, eventually leading to a situation in which work would be divided among all members of society (solving the issue of unemployment in capitalism) as it is gradually reduced, emancipating labor from the need to engage in long and alienating work. Marx referred to this stage as Upper-stage communism, where goods and services (rather than income) would be provided free of charge. Other socialist authors, such as Bertrand Russell
Bertrand Russell
Bertrand Arthur William Russell, 3rd Earl Russell, OM, FRS was a British philosopher, logician, mathematician, historian, and social critic. At various points in his life he considered himself a liberal, a socialist, and a pacifist, but he also admitted that he had never been any of these things...
, envisioned four-hour workdays in a future socialist society.
Many of the following advocates have actually proposed a negative income tax
Negative income tax
In economics, a negative income tax is a progressive income tax system where people earning below a certain amount receive supplemental pay from the government instead of paying taxes to the government. Such a system has been discussed by economists but never fully implemented...
, which is means tested, rather than a basic income. Despite their differences in administration and effect, the two proposals are usually conflated.
Many countries have political parties that advocate a basic income, such as the Green Party of the United States, Green Party of Canada
Green Party of Canada
The Green Party of Canada is a Canadian federal political party founded in 1983 with 10,000–12,000 registered members as of October 2008. The Greens advance a broad multi-issue political platform that reflects its core values of ecological wisdom, social justice, grassroots democracy and...
, Green Party of England and Wales
Green Party of England and Wales
The Green Party of England and Wales is a political party in England and Wales which follows the traditions of Green politics and maintains a strong commitment to social progressivism. It is the largest Green party in the United Kingdom, containing within it various regional divisions including...
, Vivant
Vivant
Vivant is a small Belgian social liberal party founded by millionaire Roland Duchâtelet. In the regional elections in June 2004, the party formed a strategic alliance with the Flemish Liberals and Democrats . Both parties are founded on the principle of individualism and can be called liberal...
(Belgium), De Groenen
The Greens
The Greens is the name of several different green parties:* Australian Greens, also known as The Greens* The Greens – The Green Alternative, Austria* The Greens * The Greens * The Greens * The Greens...
and GreenLeft
GreenLeft
GreenLeft is a green political party operating in the Netherlands.GreenLeft was formed on 1 March 1989 as a merger of four left-wing political parties: the Communist Party of the Netherlands, Pacifist Socialist Party, the Political Party of Radicals and the Evangelical People's Party...
(The Netherlands), the Scottish Green Party
Scottish Green Party
The Scottish Green Party is a green party in Scotland. It has two MSPs in the devolved Scottish Parliament, Alison Johnstone, representing Lothian, and Patrick Harvie, for Glasgow.-Organisation:...
, Socialist Party of South Korea, the New Zealand Democratic Party
New Zealand Democratic Party
The New Zealand Democratic Party for Social Credit is a small leftist political party in New Zealand. It is based around the ideas of Social Credit, an economic theory which also attracted some degree of support in Canada and Australia...
, the Liberal Party of Norway, Norwegian Green Party and Norwegian Red Party and the Workers' Party (Brazil)
Workers' Party (Brazil)
The Workers' Party is a democratic socialist political party in Brazil. Launched in 1980, it is recognized as one of the largest and most important left-wing movements of Latin America. It governs at the federal level in a coalition government with several other parties since January 1, 2003...
, New Party Nippon
New Party Nippon
The New Party Nippon is a Japanese political party formed on August 21, 2005. The party is headed by the former Nagano governor Yasuo Tanaka, and includes Diet members Kōki Kobayashi , Takashi Aoyama, Makoto Taki, and Hiroyuki Arai, who left the Liberal Democratic Party in opposition to Prime...
(Japan), Greens Japan as well as the Pirate Party Germany.
Worldwide, supporters of a basic income have united in the Basic Income Earth Network
Basic Income Earth Network
The Basic Income Earth Network is a network of academics and activists interested in the idea of a universal basic income, i.e. a guaranteed minimum income based solely on citizenship and not on work requirement or charity...
. BIEN recognizes numerous national advocacy groups.
One of the world's outspoken advocates of a basic income system is the Belgian
Belgium
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
philosopher and political economist Philippe van Parijs
Philippe Van Parijs
Philippe Van Parijs is a Belgian philosopher and political economist, mainly known as a proponent and main defender of the basic income concept.-Education:...
.. Other advocates include Gunnar Adler-Karlsson (Sweden), Götz Werner
Götz Werner
Götz Wolfgang Werner is the founder, co-owner, and member of the advisory board of dm-drogerie markt, a German drugstore chain. He was leading the company for 35 years. Since October 2003, he is the head of Cross-Department Group for Entrepreneurial Studies at the Karlsruhe Institute of Technology...
(Germany), Saar Boerlage (Netherlands), Herwig Büchele (Austria), André Gorz
André Gorz
André Gorz , pen name of Gérard Horst, born Gerhard Hirsch, also known by his pen name Michel Bosquet, was an Austrian and French social philosopher. Also a journalist, he co-founded Le Nouvel Observateur weekly in 1964...
(France), Michael Hardt
Michael Hardt
Michael Hardt is an American literary theorist and political philosopher perhaps best known for Empire, written with Antonio Negri and published in 2000...
and Antonio Negri
Antonio Negri
Antonio Negri is an Italian Marxist sociologist and political philosopher.Negri is best-known for his co-authorship of Empire, and secondarily for his work on Spinoza. Born in Padua, he became a political philosophy professor in his hometown university...
, Charles Murray
Charles Murray (author)
Charles Alan Murray is an American libertarian political scientist, author, columnist, and pundit working as a fellow at the American Enterprise Institute, a conservative think tank in Washington, DC...
(USA), Keith Rankin (New Zealand), Daniel Raventós (Spain), Osmo Soininvaara
Osmo Soininvaara
Osmo Heikki Kristian Soininvaara is a Finnish politician and writer. He served as Minister of Health on Social Services in Lipponen's second cabinet between 14 April 2000 and 19 April 2002. He was the leader of the Finnish Green League party from 2001 to 2005...
(Finland), Guy Standing (UK), Eduardo Suplicy
Eduardo Suplicy
Eduardo Matarazzo Suplicy is a Brazilian left-wing politician, economist and professor. He is one of the founders and main political figures on the Workers Party of Brazil .-Biography:...
(Brazil) and Walter van Trier (Belgium)
In 1968, James Tobin
James Tobin
James Tobin was an American economist who, in his lifetime, served on the Council of Economic Advisors and the Board of Governors of the Federal Reserve System, and taught at Harvard and Yale Universities. He developed the ideas of Keynesian economics, and advocated government intervention to...
, Paul Samuelson
Paul Samuelson
Paul Anthony Samuelson was an American economist, and the first American to win the Nobel Memorial Prize in Economic Sciences. The Swedish Royal Academies stated, when awarding the prize, that he "has done more than any other contemporary economist to raise the level of scientific analysis in...
, John Kenneth Galbraith
John Kenneth Galbraith
John Kenneth "Ken" Galbraith , OC was a Canadian-American economist. He was a Keynesian and an institutionalist, a leading proponent of 20th-century American liberalism...
and another 1,200 economists signed a document calling for the US Congress to introduce in that year a system of income guarantees and supplements.
In the 1972 presidential campaign, Senator George McGovern
George McGovern
George Stanley McGovern is an historian, author, and former U.S. Representative, U.S. Senator, and the Democratic Party nominee in the 1972 presidential election....
called for a 'demogrant' that was very similar to a basic income.
In 1973, Daniel Patrick Moynihan
Daniel Patrick Moynihan
Daniel Patrick "Pat" Moynihan was an American politician and sociologist. A member of the Democratic Party, he was first elected to the United States Senate for New York in 1976, and was re-elected three times . He declined to run for re-election in 2000...
wrote The Politics of a Guaranteed Income (ISBN 0394463544) in which he advocated for the Basic Income and discussed Richard Nixon's
Richard Nixon
Richard Milhous Nixon was the 37th President of the United States, serving from 1969 to 1974. The only president to resign the office, Nixon had previously served as a US representative and senator from California and as the 36th Vice President of the United States from 1953 to 1961 under...
GAI proposal.
Mike Gravel
Mike Gravel
Maurice Robert "Mike" Gravel is a former Democratic United States Senator from Alaska, who served two terms from 1969 to 1981, and a former candidate in the 2008 presidential election....
, a former US congressman and presidential candidate, advocates a tax rebate paid in a monthly check from the government to all citizens as part of a transition away from income taxes and toward a pre-bated national sales tax (the FairTax
FairTax
The FairTax is a tax reform proposal for the federal government of the United States that would replace all federal taxes on personal and corporate income with a single broad national consumption tax on retail sales. The Fair Tax Act would apply a tax once at the point of purchase on all new goods...
).
Winners of the Nobel Prize in Economics who fully support a basic income include Herbert Simon
Herbert Simon
Herbert Alexander Simon was an American political scientist, economist, sociologist, and psychologist, and professor—most notably at Carnegie Mellon University—whose research ranged across the fields of cognitive psychology, cognitive science, computer science, public administration, economics,...
, Friedrich Hayek
Friedrich Hayek
Friedrich August Hayek CH , born in Austria-Hungary as Friedrich August von Hayek, was an economist and philosopher best known for his defense of classical liberalism and free-market capitalism against socialist and collectivist thought...
, James Meade
James Meade
James Edward Meade CB, FBA was a British economist and winner of the 1977 Nobel Memorial Prize in Economic Sciences jointly with the Swedish economist Bertil Ohlin for their "Pathbreaking contribution to the theory of international trade and international capital movements."Meade was born in...
, Robert Solow
Robert Solow
Robert Merton Solow is an American economist particularly known for his work on the theory of economic growth that culminated in the exogenous growth model named after him...
, and Milton Friedman
Milton Friedman
Milton Friedman was an American economist, statistician, academic, and author who taught at the University of Chicago for more than three decades...
.
In his final book Full employment regained? James Meade states that a return to full employment
Full employment
In macroeconomics, full employment is a condition of the national economy, where all or nearly all persons willing and able to work at the prevailing wages and working conditions are able to do so....
can be achieved only if, among other things, workers offer their services at a low enough price, that the required wage for unskilled labour would be too low to generate a socially desirable distribution of income, and that therefore a citizen's income would be necessary.
Erik Olin Wright characterizes basic income as a socialist project and a further reform to capitalism that establishes the basis of a social economy by empowering labor in relation to capital.
Richard Parncutt argues that income tax is effectively progressive when basic income is combined with flat income tax. The combination would radically simplify the tax-welfare system, enabling voters to support policies that truly serve their personal interest and strengthen the entire economy, leading to elimination of poverty.
In his Robotic Nation essays, Marshall Brain
Marshall Brain
Marshall David Brain is an American author, public speaker, and entrepreneur. A former college instructor and computer programmer, Brain is the founder of HowStuffWorks.-Background:Marshall Brain was born in Santa Monica, California...
argues that the growing amount of automation in the workplace will eventually displace a large percentage of workers, and that in order to be able to maintain the economy, an annual stipend will be needed. A similar argument was made by Jeremy Rifkin
Jeremy Rifkin
Jeremy Rifkin is an American economist, writer, public speaker, political advisor and activist. He is the founder and president of the Foundation On Economic Trends...
, in his book The End of Work
The End of Work
The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era is a non-fiction book by American economist Jeremy Rifkin, published in 1995 by Putnam Publishing Group....
.
Martin Ford in The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future (free PDF available) , argues that most routine jobs in the economy will ultimately be automated via advancing technologies such as robotics and artificial intelligence and that, without a basic guaranteed income, this will cause a drastic decline in consumer demand and confidence, possibly precipitating a major economic crisis. Ford further argues that the level of the basic income should vary based on incentives such as the pursuit of higher education, or behaviours that benefit the community or the environment.
The Natural Governance Philosophy expands on the justification for basic income beyond its survival income purpose. The default use of tax revenue should be an egalitarian cash dividend to citizens, and the alternative to the cost of any social (government) program should be an egalitarian dividend to all social citizens. Only if a majority prefers spending for the program compared to receiving their share of the cash costs of the program, should that program be funded.
Funding
Many different sources of funding have been suggested for a guaranteed minimum income:- Income taxIncome taxAn income tax is a tax levied on the income of individuals or businesses . Various income tax systems exist, with varying degrees of tax incidence. Income taxation can be progressive, proportional, or regressive. When the tax is levied on the income of companies, it is often called a corporate...
es - Sales taxSales taxA sales tax is a tax, usually paid by the consumer at the point of purchase, itemized separately from the base price, for certain goods and services. The tax amount is usually calculated by applying a percentage rate to the taxable price of a sale....
es - Capital gains taxCapital gains taxA capital gains tax is a tax charged on capital gains, the profit realized on the sale of a non-inventory asset that was purchased at a lower price. The most common capital gains are realized from the sale of stocks, bonds, precious metals and property...
es - Fiat money
- Inheritance taxInheritance taxAn inheritance tax or estate tax is a levy paid by a person who inherits money or property or a tax on the estate of a person who has died...
es - Wealth taxWealth taxA wealth tax is generally conceived of as a levy based on the aggregate value of all household holdings actually accumulated as purchasing power stock , including owner-occupied housing; cash, bank deposits, money funds, and savings in insurance and pension plans; investment in real estate and...
es, e.g. property taxProperty taxA property tax is an ad valorem levy on the value of property that the owner is required to pay. The tax is levied by the governing authority of the jurisdiction in which the property is located; it may be paid to a national government, a federated state or a municipality... - Luxury taxLuxury taxA luxury tax is a tax on luxury goods: products not considered essential. A luxury tax may be modeled after a sales tax or VAT, charged as a percentage on all items of particular classes, except that it mainly affects the wealthy because the wealthy are the most likely to buy luxuries such as...
es - Elimination of current income support programs and tax deductionTax deductionIncome tax systems generally allow a tax deduction, i.e., a reduction of the income subject to tax, for various items, especially expenses incurred to produce income. Often these deductions are subject to limitations or conditions...
s - Repayment of the grant at death or retirementRetirementRetirement is the point where a person stops employment completely. A person may also semi-retire by reducing work hours.Many people choose to retire when they are eligible for private or public pension benefits, although some are forced to retire when physical conditions don't allow the person to...
- Land and natural resource taxesLand value taxA land value tax is a levy on the unimproved value of land. It is an ad valorem tax on land that disregards the value of buildings, personal property and other improvements...
- Pollution taxes
- Fees from government-created monopoliesMonopolyA monopoly exists when a specific person or enterprise is the only supplier of a particular commodity...
(such as the broadcast spectrumBroadcastingBroadcasting is the distribution of audio and video content to a dispersed audience via any audio visual medium. Receiving parties may include the general public or a relatively large subset of thereof...
and utilities) - Collective resource ownership Capitalism 3.0
- Universal stock ownership Capital ownership SESJ
- Profit accrued from state-owned enterprises
- A National Mutual Fund
- Money creation or seignorage
- Tariffs, the lotteryLotteryA lottery is a form of gambling which involves the drawing of lots for a prize.Lottery is outlawed by some governments, while others endorse it to the extent of organizing a national or state lottery. It is common to find some degree of regulation of lottery by governments...
, or sin taxes - TechnologyTechnologyTechnology is the making, usage, and knowledge of tools, machines, techniques, crafts, systems or methods of organization in order to solve a problem or perform a specific function. It can also refer to the collection of such tools, machinery, and procedures. The word technology comes ;...
Taxes - Tobin TaxTobin taxA Tobin tax, suggested by Nobel Laureate economist James Tobin, was originally defined as a tax on all spot conversions of one currency into another...
- Value added taxValue added taxA value added tax or value-added tax is a form of consumption tax. From the perspective of the buyer, it is a tax on the purchase price. From that of the seller, it is a tax only on the "value added" to a product, material or service, from an accounting point of view, by this stage of its...
or other Consumption taxConsumption taxA consumption tax is a tax on spending on goods and services. The tax base of such a tax is the money spent on consumption. Consumption taxes are usually indirect, such as a sales tax or a value added tax...
es - DemurrageDemurrage (currency)Demurrage is a cost associated with owning or holding currency over a given period of time. It is sometimes referred to as a carrying cost of money. For commodity money such as gold, demurrage is in practice nothing more than the cost of storing and securing the gold...
Criticisms
One critical view of Basic Income theorizes that it would have a negative effect on work incentive and labor supply. Even when the benefits are not permanent, the hours worked - by the recipients of the benefit - are observed to decline by 5%, a decrease of 2 hours in a typical 40 hour work week, in one study:
While experiments have been conducted in the United States and Canada, those participating knew that their benefits were not permanent and, consequently, they were not likely to change their behaviour as much or in the same manner had the GAI been ongoing. As a result, total hours worked fell by about five percent on average. The work reduction was largest for second earners in two-earner households and weakest for the main earner. Further, the negative work effect was higher the more generous the benefit level.
However, in studies of the Mincome experiment in rural Manitoba, the only two groups who worked less in a significant way were new mothers, and teenagers working to support their families. New mothers spent this time with their infant children, and working teenagers put significant additional time into their schooling. Under Mincome, "the reduction of work effort was modest: about one per cent for men, three per cent for wives, and five per cent for unmarried women."
Further reading
- Rubén M. Lo Vuolo, Daniel Raventós and Pablo Yanes, "Basic Income in Times of Economic Crisis: The War Social and Working Rights," Counterpunch (Weekend Edition, November 5-7, 2010).
- Rubén Lo Vuolo and Daniel Raventós, "Basic Income: good in the boom, essential in the crisis," On Line Opinion (Australia’s e-journal of social and political debate), posted Thursday, 16 July 2009. [ retrieved 17-02-2011 ].
- "History of Basic Income," BIEN (Basic Income Earth Network).
- Social Contract Revisited publications: Basic Income and Income Support in the Modern Welfare State, The Foundation for Law, Justice and Society (Contributors: Amir Paz-Fuchs, Peter Edelman, Amitai Etzioni, Charles Murray, Michael Opielka, Dalmer Hoskins, Avia Spivak, Frank Bloch). [ Retrieved 17-02-2011 ].
See also
- Anti-workAnti-workThe anti-work ethic states that labor tends to cause unhappiness, and is increasingly challenged by work performed by machines. Therefore, the quantity of labor ought to be lessened...
ethic - Asset-based egalitarianismAsset-based egalitarianismAsset-based egalitarianism is a form of egalitarianism which theorises that equality is possible by a redistribution of resources, usually in the form of a capital grant provided at the age of majority...
(variant of basic income) - Cash transfersCash transfersCash transfers are direct transfer payments of money to eligible people. Cash transfers are usually provided by the state and federal government.-Targeting:...
- Guaranteed minimum incomeGuaranteed minimum incomeGuaranteed minimum income is a system of social welfare provision that guarantees that all citizens or families have an income sufficient to live on, provided they meet certain conditions. Eligibility is typically determined by citizenship, a means test and either availability for the labour...
- Minimum wageMinimum wageA minimum wage is the lowest hourly, daily or monthly remuneration that employers may legally pay to workers. Equivalently, it is the lowest wage at which workers may sell their labour. Although minimum wage laws are in effect in a great many jurisdictions, there are differences of opinion about...
- Negative income taxNegative income taxIn economics, a negative income tax is a progressive income tax system where people earning below a certain amount receive supplemental pay from the government instead of paying taxes to the government. Such a system has been discussed by economists but never fully implemented...
- Old Age SecurityOld Age SecurityThe Old Age Security pension is a taxable monthly social security payment available to most Canadians 65 years of age or older. As of July, 2011, the basic amount is C$533.70 per month. At tax time, recipients with 2010 incomes over C$67,668 must pay back a portion of their Old Age Security at a...
- Refusal of workRefusal of workRefusal of work is behavior which refuses to adapt to regular employment.As actual behavior, with or without a political or philosophical program, it has been practiced by various subcultures and individuals. Radical political positions have openly advocated refusal of work. From within marxism it...
- Social dividendSocial dividendA social dividend is a proposal for allocating surplus value, or economic profits, generated by publicly-owned enterprises in a socialist economic system...
- Social welfare provision
- Basic income in the NetherlandsBasic income in the NetherlandsThe issue of the basic income gained prominence on the political agenda in Netherlands between the mid-1970s and mid-1990s but it has disappeared from the political agenda over the last fifteen years.-Political background:...
- Speenhamland system
- FairTax: Monthly tax rebate
- Work–life balance
External links
- Basic income for all-Philippe van Parijs, Boston Review
- Guaranteed Basic Income Studies: How it could be organised, Different Suggestions
- Basic Income Earth Network (BIEN)
- Basic Income Studies: An International Journal of Basic Income Research
- US Basic Income Guarantee Network
- "Social minimum" in the Stanford Encyclopedia of Philosophy, First published Tue Nov 16, 2004.
- Avinus Magazine (several articles, some in English)
- Citizen's Income online
- SMI²LE - View to the Future, a journal about the future with the main focus on Basic Income in four languages
- Lectures on Basic Income
- Critique of Basic Income by Slavoj ŽižekSlavoj ŽižekSlavoj Žižek is a Slovenian philosopher, critical theorist working in the traditions of Hegelianism, Marxism and Lacanian psychoanalysis. He has made contributions to political theory, film theory, and theoretical psychoanalysis....
, presented at the RSA