Basic income: A debate.

AuthorLawrence, Mat
PositionPolicy Development

Many see it as a 'silver bullet' policy innovation: the RSA is behind it, as is Compass, and support also comes from the Adam Smith Institute and Silicone Valley tech-utopians. Neal Lawson and Mat Lawrence debate Basic Income in theory and practice.

Round I

Dear Mat,

As we know, more and more people are talking about Basic Income (BI), an unconditional, automatic and nothwithdrawable payment. The RSA is behind it, as is Compass, as is intriguingly the Adam Smith Institute (we should get into why). Major trials are taking place in Finland and Utrecht, and Switzerland just had a referendum on a BI (it was lost). And back here Labour's Leader and Shadow Chancellor have said they are interested in the idea while on the other wing of the Party, Jonathan Reynolds MP is a strong backer of this big policy shift. Why is all this interest bubbling up, could a BI work, and if so, how might we make it happen?

I think I'm right that you are an open minded sceptic about the idea, so hopefully we can bounce some thoughts back and forth that will develop our own thinking and open the issue up to Renewal readers. And just to be clear, I'm not a policy expert or an economist but I'm increasingly sold on the idea. It's not the silver bullet, but it might just be a bronze. So what's all the fuss about?

The growing interest has several drivers; wages in the West have been flat-lining for a decade, and work and life have become more precarious. Outsourcing, zero hours contracts and the 'gig economy' are creating a sense of insecurity and anxiety right through the income chain. Of course the 'march of the machine' is a big backdrop too. Won't the robots just take over, and without a BI will there be food riots? Well maybe. My own sense is that this technological revolution could be unlike others - in that the net impact could see quite large scale job replacement. If both muscle and brain can be replaced by technology then what are we going to do? Sure there are caring jobs and may be more of them, but I sense something big is brewing. The boy cries wolf and everyone ignores him--but eventually the wolf comes. I think the robot/algorithm wolf might be coming. But we can't base a big policy jump like BI on a forecast or a hunch.

What we can base it on is the fact that the welfare system now is no longer fit for purpose. It has undergone decades of reform, universal credit being only the latest, but it's essentially an insurance based system that relies on most people being in full time work most of the time. It's been creaking and cracking as part-time and temporary work replaced a job for life, and now the precariat is a rising and embryonic class in its own right. A welfare system that tries to impose a twentieth century straitjacket on a twenty-first century, complex labour market just won't work. But not only does it not function--it's pretty inhumane. It is based on the humiliation of the people it is there to serve.

So this is my dual starting point in support of a BI. First the pragmatic reason that the nature of the twenty-first century labour market is already incompatible with a twentieth century welfare system based around the insurance model. The robots might come--but even if they don't we need to transform the system in ways that support people through an increasingly precarious working existence. And second, the principled reason, is that we should design systems around a belief in the best in people, not the worst. This is the belief that people, or at least the vast majority of them, are not lazy but incredibly committed and creative and that through the security and recognition that a BI offers will be able to develop to their full potential. A BI gives people space to train, retrain, be educated, refuse low paid jobs, go for more rewarding careers and start their own enterprises. As the old Swedish social democrat slogan goes, 'secure people dare'. But here there is something more than just hard economics at work. I sense a yearning for something more in life than just work--the time to love, care, create and be a citizen. A BI gives people recognition that society believes in and supports its citizens.

I know there are a lot of moral and practical issues about the possible introduction of a BI. Let's get into them. But it's the biggest idea of our political moment. Is it the right one?

Yours in Hope,

Neal

Dear Neal

Political projects succeed when they have a strong set of demands allied to a sense they own the future. As the seemingly terminal decline of twentieth century social democracy continues, the re-emergence on the Left of the demand for a universal basic income is therefore a cause for potential optimism. After all, as you rightly set out, the idea has much intuitive appeal.

A basic income (BI) would strike against growing insecurity in the labour market, compensate for unwaged social labour, promote gender equality, and promises to simplify a complex, bureaucratic and often cruel welfare system. And if the robots really do arrive, a basic income holds out an emancipatory promise: a policy to create a more caring, creative, and less work-based society. So I am perhaps better characterised as a cautious supporter, but one with serious reservations.

What then are my concerns? I should start by saying I'm not convinced by many of the existing critiques--that it is overly utopian or would undermine work incentives, for example. Instead my concerns centre on questions of practicality, progressivity, and the politics of a basic income. None are insurmountable, and I look forward to batting them back and forth with you.

First, there are important technical issues. A key appeal is that it would replace the complexity of the UK's social security with a single unconditional payment for all, at a stroke ending the bureaucratic regime...

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