Apr 11, 2018

Bigger than you, me and Bernard – UBI demands big thinking

UBI is an inherently democratising project, re-conceiving the relationship between the citizen and the state.

Tim Hollo

Executive director, The Green Institute

The below is a special extended comment, a response to Bernard Keane's article on April 10, "Universal basic income? More like universally bad idea". Over the next little while, Crikey's associate editors will occasionally publish longer comments from our readers. So if you've got big ideas about something you've read in Crikey, get in touch at [email protected].

Sir Thomas More, who presented the idea of a universal basic income in his great work Utopia, in 1516, would be surprised to hear Bernard Keane’s claim that it is a “neoliberal solution to a particularly neoliberal problem”. His proposal, which preceded liberalism by centuries, let alone neoliberalism, was grounded in the search for social cohesion by supporting people to feed themselves rather than punishing them for failing to do so.

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67 thoughts on “Bigger than you, me and Bernard – UBI demands big thinking

  1. Arky

    I’m sure Bernard can defend himself, but I don’t think you do any favours by opening your argument by first going back hundreds of years for support, as if a general idea from the 16th century is anything like a concrete policy proposal in the modern world, and then strawmanning your opponent as being ignorant of the history.

    Nor for that matter saying an idea deserves to be taken seriously because its intellectual roots go back hundreds of years. Given how many progressive achievements require getting away from old ideas, demanding something being taken seriously because it is old is, um…. yeah. Argue the merits.

    Your piece goes on to make lots of high-minded pious assertions – “driven by the desire to create a fairer, more equal world while giving people agency” is a particularly big one. This is all very well and good but anyone can say that about any policy. It’s not an actual argument.

    Then we eventually get to the thrust of it:
    “It is an enabling policy for the great majority, while, through the implied and necessary tax increases on the rich, limiting and devaluing greed.”

    You can’t bury that kind of thing as “implied”. Most people arguing for UBI are not implying that, and even if they are they are not doing the hard yards on what sort of tax increases we’re talking about.

    The challenge of UBI is exactly here- what gets cut to pay for it, what taxes are raised to pay for it, does that collective package actually improve anything for anyone over the more targeted welfare states which exist now? You can’t just drop UBI on the table in the vaccuum and say “this is good, make it work”, and bury the detail by saying it is “implied”.

    Come back with a real policy proposal and not some nice words about agency and an aside about implied tax increases and then we can talk.

    Until then, UBI remains as Bernard said it is, a stalking horse for Libertarian types who want to use it as an excuse to strip services and welfare, with no tax raises implied or otherwise.

    1. covenanter

      My, my a very post modern take on history is this not?
      Has history then indeed ended after all with no lessons at all needed from that source?
      The philosophical definition of modernity postulated universal numeracy and literacy, Perhaps when that point is reached then something of the post-modern all lessons learnt posture adopted in your reply might be justified.
      but as it stands it appears long-winded, desperate and redolent of an ignorance of the subject, history, which is decried.
      Further the obvious answer to the typicalconservative cry of where’s the money coming from?
      Well. the same place the money comes from to pay the dole to sustain a pool of desperate unemployed willing to work for next to nothing remember the protesters here in OZ who deliberately and ironically advocated voluntary slavery as an answer to unemployment?
      The historical reference might escape most, try Ancient Rome.
      There is an historical method in economics, even the Marxists who stole it from Smith accept that.
      Or even look at the whole process of wealth creation with labour competing, with the interest to be paid in borrowed capital, for the profits of any productive enterprise, Smith again, so why are things different now?
      Sorry Arky, your criticisms barely hold.

      1. Arky

        Your comment is barely coherent, and it is quite ironic for you say I was being long-winded…

        I am a big fan of studying history to avoid repeating the mistakes of the past. Because I have studied history, I know that “someone thought of this hundreds of years ago” does not make something either more or less worthwhile now.

        As for “where’s the money coming from?”, that is simply a question you have to answer if you are proposing a massive reform of welfare and tax payments. It’s not conservative to ask that. If Tim was proposing giving every family in Australia a unicorn, it would be reasonable to argue where he was going to find a million or so unicorns. In this case, where’s the money? Because the big risk is that the money comes OUT of health, education etc.

        1. covenanter

          I will allow that your powers of comprehension might match a contemptuous ignorance of history, (which is dressed up as some sort of omniscience of the subject which allows you to dismiss it altogether?).
          Good attempt at justification.
          Like your colleague Ruv, you clearly haven’t done the work of studying the subject, the Historical Method in Economics, never have wanted to study it, deny it even exists, as your comments on the article might show?
          Not much of an argument,”I’m an intellectual Sloth”.
          Do the work and read up on the subject, The Greens have internationally held to the principle of economic and social justice, or rights. since the 1970’s, perhaps they have contemplated this principle longer than many in the community, and have concluded that the historical method in economics is worth the lesson.
          You dismiss it off-hand, or worse use it as an argument that, being history, it is irrelevant. All that is needed is a team of such sloths and they can hold some international games to display there god-like excellence to their many fans, no training necessary.
          Come on, your original comment was as facile and as meaningful as a stomach rumble, or some self-indulgent flatulence, much like most of the mainstream media’s reaction to The Greens over the decades.
          Why engage the brain when you don’t have to?

          1. Arky

            Like Tim, apparently you think strawmanning your opponent with claims of ignorance and throwing grandiose statements around is the way to go.

            It isn’t. Trump winning office that way is an outlier which had a lot of other factors to it.

    2. Dog's Breakfast

      I think the ‘implied’ is obvious Arky. Only a delusional neocon would think otherwise, and it is key to any serious discussion. Unfortunately, not having the resources of an entire Treasury department behind me, it’s hard to do the numbers, but here’s a grab bag of possible contributors to the revenue necessary to bring it in;

      Increase in company tax (over $50M revenue) to 35%; transactions tax on shares as has been suggested for years (either raises shiteloads, or diminishes speculation and algorithm driven buying and selling, good outcome ether way); mining companies paying reasonable rates for extraction of our minerals regardless of whether they make a profit or not; reduction in write-offs and deductibles mainly for big business but also small and PAYE tax payers; actually getting real tax paid by multi-nationals who are allowed to export profits to wherever they like; clamp down on trusts and assorted tax dodging, banning money going to Cayman Islands tax schemes and the like; abolishing the rebate for private health cover; reducing the superannuation tax benefits at say the $250K+ mark, and as the UBI would be tax free on top of any wage, increase in income taxes at the current median and substantial increases thereon, such that anyone earning around $200K or $250K plus would come out even, and above that would be taking home less. What’s that, about a couple of hundred billion per annum, should be able to get up a solid UBI with that.

      Savings, so many it’s hard to know where to start. Is any of that enough to suggest that it is doable?

      1. Draco Houston

        Why on Earth would you take tax increases on the rich as a given? The right have set out a very easy plan to use it to abolish other kinds of welfare and all the left version has is a fantasy of tax reform.

        1. Arky

          It’s lazy, arguing for the “free money for everyone” part while burying the “massive tax increase” part.

  2. Ruv Draba

    A Wikipedia history lesson, some high-flown rhetoric and not one single specific, significant, predictive, insightful, independently-verifiable proposition in the entire article.

    This is the best the Greens could write in rebuttal to as UBI-friendly an audience as they’re likely to get in an Australian news organ?

    Tim, I’d happily have Greens reps at my dinner-table or loan one the use of a bike, but this is precisely why I don’t view your party as having anything like the capability of a party of government.

    Run along now. The adults are talking.

    1. covenanter

      Perhaps Ruv, any real adults commenting on UBI would not be carping so blatantly about their ignorance of the Historical Method in Economics. We are not quite post modern yet, where history has ended. Try again when you have amended your deficient education on the subject?

      1. Ruv Draba

        For my part, I’d be happy to see some rigorous and relevant historical analysis with predictive clout — while not the best an economist might do, it’s a start.

        If you can find an example in Tim’s marshmallow rhetoric above, please feel free to point it out.

    2. covenanter

      “Sir, we are all your students”, an Eighteenth century British PM’s address to Adam Smith, after his “Wealth of Nations” became studied across the literate world.
      Knock yourself out and read what they read, or is being spoon-fed like an infant what you might prefer?
      Spare us the drivel about adults please, adults take responsibility.

      1. Ruv Draba

        Covenanter, since you’ve started replacing Tim’s arguments with your own, I understand you to believe that you could have done a better job of defending UBI than he did.

        If that’s your position then despite not knowing you from a bar of Solvol, I’ll concede that I do too.

        1. covenanter

          Ruv, your special relationship with a bar of Solvol, whatever rocks your boat ?, is quite irrelevant to the argument,
          Tim may, most probably, (considering his party’s economic principle), have studied the Historical Method in Economics, your reply merely obfuscates your unwillingness to match his understanding, preferring unfounded ridicule and references to “adults’ like that character Abbott.
          No, Ruv, you usually do better, you can do better and you should do better when reacting to The Greens.
          It is disappointment which provoked my replies.

          1. Ruv Draba

            C, I can see that my castigating Tim angered you. However, I feel he deserves it as he has disrespected you, me and the entire Crikey readership.

            I’d like to say that I don’t question the Greens’ intentions here, but I’m afraid to say they’re suspect: the Greens have been around for 16 years and the UBI has been around as an idea since the late 18th century, yet the Greens are only now proposing it as policy. The interesting question isn’t ‘why’ so much as ‘why now’? Have their values changed? Did a Green trip over a history book? Or is there a different reason?

            But my criticisms that angered you weren’t about their policy intentions since I didn’t comment on that — they were about Tim’s argument. Tim was purportedly responding to Bernard’s article, yet what Tim floated wasn’t a policy discussion; he was just lauding an aim. But Bernard’s criticisms weren’t about aims — they were about policy, so Tim’s attempt at rebuttal was a non-sequitur.

            If you don’t understand the difference between an aim and a policy, please feel free to ask a question. If you’d like to know why a non-sequitur is a failure of intellect and disrespectful of an audience, please ask. Beyond that, thank you for your interest, but I cannot help you at this time.

    3. Dog's Breakfast

      “some high-flown rhetoric and not one single specific, significant, predictive, insightful, independently-verifiable proposition in the entire article.”

      That also describes Bernard’s article yesterday, and your comments today, not one single specific, insightful ………………………..

      1. Ruv Draba

        If you’d like to lodge that criticism in a comment under Bernard’s article to keep it on-topic, DB, I’ll be happy to point out the part of his article that makes it wrong.

        1. Howard

          “Greens’ intentions here, but I’m afraid to say they’re suspect: the Greens have been around for 16 years and the UBI has been around as an idea since the late 18th century, yet the Greens are only now proposing it as policy. The interesting question isn’t ‘why’ so much as ‘why now’? Have their values changed? Did a Green trip over a history book? Or is there a different reason?”

          Are you serious? Many people, including many Greens have supported some form of a UBI for a lifetime. Why should this mean their values have changed just because it now has the support of their members and the times suit its introduction. They are a democratic party you know.

          The Labor party valued some form of resources tax for a long time but it wasn’t until the biggest resources boom in our history and after the GFC that it was considered an opportune time to introduce a policy. The neolibs have always wanted to increase profits at the expense of wages but recently it wasn’t until they managed to disempower Unions that they introduced their work choices policy.

          If you keep singling out one party for behaving the way all political parties behave, readers will start to think you are biased.

  3. Jeanette Weir

    If you are receiving the dole, a UBI does make practical sense because you can easily accept 5, 10 or 20 hour work and not worry about the implications further down the track aka robo-debt collection by social security department. You would find that employment would actually increase. People would be happier to work hours that suit.

    1. Draco Houston

      The proposed amount would have to be at least what the dole gives or you’re just talking about privatized Work For The Dole.

    2. Charlie Chaplin

      Except when the UBI means you have account for every dollar you earn- and you lose half of it- like the Ontario trial:

      The total working age population of Ontario is 11,038,440. The number of participants in the UBI trial is 4000- 0.036% of the total working age population. All participants are currently on low incomes. The UBI pays C $16,989 per annum or $326.71 per week to a single person less 50% of any earned income, and C $24,027 per annum or $462.05 per week to a couple, less 50% of any earned income. The Canadian unemployment system works on 55% of your personal earnings over the 40 weeks prior to you becoming unemployed, so I can’t put a flat dollar value on Canadian unemployment benefits, but I can tell you the general minimum wage in Ontario is C $525.00 per week.

      The Finnish UBI trial is a little different. It lets you keep your UBI payment even if you find work. That makes it a bit of pocket money for those who do find work, but things aren’t too rosy for those who don’t- and consdering Finland’s official unemployment rate ( after inflation, of course) is 8%, that’s a lot of people:

      Finland Trial
      The working age population of Finland is 3,435,610. The Finnish UBI experiment involves 2000 randomly selected people across Finland. So the experiment is being tried on 0.058% of the population: not exactly “universal”. The 2000 receive €560 per month. Interestingly, the average Finnish unemployment benefit is €697 per month, and once the mandatory 20% tax is taken out you receive €558 per month.

      When is the dole not the dole? When it’s a UBI.

      The median monthly Finnish wage for workers with only a secondary school education (aka low skilled workers) is €2600.

      The robo-debt issue is pretty recent, but there’s nothing new about structural unemployment, so I can’t help thinking you think people on the dole knock back work, Jeanette; that unemployment is somehow voluntary. Perhaps you don’t – if not, I apologise- but god knows I’ve heard it a hell of a lot over the last few decades, this notion that the unemployed are choosy and the dole allows them to be. The maximum Newstart a single adult with rent to pay will receive is $673.60 per fortnight. If you’re an unemployed adult with a mortgage, you’ll receive $538.80 per fortnight. Not exactly amounts to conjure a life of leisure, picking and choosing work hours that suit, are they?

      People are unemployed because there aren’t enough jobs. There’s also no wages growth- particularly for low income earners. The huge army of under/unemployed people are used to keep wages down. The punitive dole keeps everyone in line. And we’re a long way from the fabled post-work world UBI proponents have been expecting daily for the last forty years. Can we do something about under/unemployment please? Like a Job Guarantee?

      1. kyle Hargraves

        Charlie, you are citing particular instances. On the one hand : all to the good but (on the other) the concept is considerably larger than what you have identified from your case studies.

        1. Charlie Chaplin

          I’m citing two of the real life trials often held up us as evidence of the efficacy of UBIs, Kyle. And I cited a third elsewhere in the 1970s held up as proof UBIs work.

          Yes, UBUs are a huge concept. So is worldwide communism, but unlike worldwide communism, there are real life UBI trials we can study.

          The deficiencies in these real trials isn’t down to me, it’s down to the intent, design and implementation of the trials. None of them are universal. All of them target individuals on the lowest incomes. All of them offer very meagre amounts of income. Most of the proposals are intended to replace the existing welfare system, and all that entails. Not one of them looks anything like what UBI proponents claim a UBI is. The only one that came close was the 2016 Swiss Referendum proposal, and guess how well it went?

          An insistence that UBI ideology is still sound doesn’t help much in the face of how actual UBIs are being implemented, or the actual proposals out there. I can’t ignore the real world because UBI ideology is:

          1. kyle Hargraves

            I do take your point Charlie

  4. Andrew Reilly

    So, for five hundred years (at least) there’s been this good idea of “let’s not let people starve, eh?”, and we happen to live in a country that although imperfect, actually has broad public and policy support for the proposition. Less than it used to have, perhaps, but more than many. The (latter-day) UBI proponents say that it’s a huge leap of faith, and we lack the vision. “Imagine”.

    Isn’t it more likely that the practical details are where it gets difficult, and that it’s those that we should be discussing?

    We have welfare. Want more? Let’s discuss the details. Banging away at a re-branding exercise isn’t doing the cause any favors.

    You would do well to pay attention to the details, because there are some promoting UBI, the free-market neoliberal types you mention, who seem to think that it would be a no-cost efficiency measure, compared to the fine-grain, means-tested (bureaucratic) system that we have now. Throwing a market, and market opportunities at what is traditionally viewed as the poster child of the sort of market failure that it is right for governments to intervene in. Perhaps they’re right, but allow me to be skeptical, and wait for some evidence and detail.

    1. covenanter

      So because some nefarious characters are promoting UBI The Greens then are to become their lone, pathetic dupes?
      As the welfare bill grows, with inevitable growing unemployment, no reaction is to take place?
      The real dupes are those who want more and more competition for scarce jobs driving down wage levels , making money scare making interest rates higher and making the already rich, Smith’s “Idle Rich” richer still?
      You might see that The Greens principle of economic and social justice or “rights’, behind their UBI policy is also matched by their principle of disarmament and non-violence.
      Those who want revolution, war and repression, the typical historic response to economic failure, will not want UBI, or any history lessons either, it seems.
      You can see where they are coming from.

      1. Andrew Reilly

        Or, you could try putting some weight behind the “imagine” and propose some actual detail that we could talk about in a sensible and non-hyperbolic fashion.

        It could be read that both your comment and that of Pmcheever, below, suggest that moving to UBI (detail omitted) will result in a reduction of the welfare bill and net savings. Can you point me towards some modelling, or even a well-reasoned argument? Pmcheever suggests that there’s actual evidence to back the claim. I’d like to see that too. My own guess is that it will increase the welfare bill substantially, but that may be a net-good thing anyway.

        You make it sound as though I, or any of the other commenters here, would be opposed to efficient ways to improve our societal situation? Why would you think that, just because I ask for more than “imagine all the people…”

        1. covenanter

          Beyond imagination, (despite Einstein saying that knowledge is nothing, and imagination is everything) there is the knowledge that in some regions Australia there has been a high level of long term unemployment sometimes across generations, This has been recognised and deplored but does it not represent a de-facto UBI?
          Where does the money come from is not as important as where the money goes to, (for those on welfare benefits are deemed below the poverty level, do and cannot not save, are thus ineligible for loans), meaning that a UBI will go directlyinto those businesses that support the existence of the community.
          Does this create more employment, (not enough perhaps) but some businesses in these De-facto UBI high unemployment regions would not exist without it?
          Some real evidence, to seriously contemplate, while more is awaited?

        2. covenanter

          Beyond imagination, (despite Einstein saying that knowledge is nothing, and imagination is everything) there is the knowledge that in some regions Australia there has been a high level of long term unemployment sometimes across generations, This has been recognised and deplored but does it not represent a de-facto UBI?
          Where does the money come from is not as important as where the money goes to, (for those on welfare benefits are deemed below the poverty level, do and cannot not save, are thus ineligible for loans), meaning that a UBI will go directlyinto those businesses that support the existence of the community.
          Does this create more employment, (not enough perhaps) but some businesses in these De-facto UBI high unemployment regions would not exist without it?
          Some real evidence, to seriously contemplate, while more is awaited?

      2. Draco Houston

        Yes, they are. So are all the left advocates of this scam.

        Shorten the bloody work week instead. Remember work week reduction and how it worked multiple times before to the great benefit of the working class? Nah, screw that, let us beg for the state’s scraps instead to top up falling wages.

      3. Richard

        Because disarmament and non-violence (you left out clean energy) are so incredibly ‘subversive’??
        Damn traitors. Good thing you are on to them for us.

  5. Smit

    Time for a UBI experiment in Australia? What about Ceduna?

  6. [email protected]

    Thanks Tim. This is the better start for this important conversation about the direction of our social contract. To those below who claim cost as an obstacle, the evidence on trials to date concludes that the positive impact on health and crime leads to net savings. Not to mention that the only Trickle Down payments that can claim consistent economic efficacy are those made below the poverty line.
    Just as we established today’s social security system following the wrenching transitions of 1850-1930 industrialisation, and even before, the establishment of democracy (Magna Carta) and capitalism (property rights) itself in response to the beginning of the industrial era, we are at a transition point that will benefit from a reflection on our social contract.
    And for me, it is both an Australian and Christian value to recognise the dignity in each of us, that is, to treat treat each other as we would want others to treat us.

  7. Dog's Breakfast

    “This is an enormous conceptual leap to make. It requires us to challenge the existing political economy and culture at a deep level; to rethink how our society operates and is organised.”

    In summary, this was my reply to Bernard’s thin and reactive article yesterday.

    1. [email protected]

      Dear Dog’s Breakfast
      Do you think there is a path by which we can have this rethink? I hope there is.

  8. Nicholas

    A Job Guarantee is superior to a UBI. A Job Guarantee has an inflation anchor built into it because it enhances the productivity capacity of society. A JG responds to people’s aspirations to contribute, belong, and gain mastery experiences. A JG can be used to widen our society’s concept of paid work beyond the narrow criterion of commercial profitability. A UBI would be inflationary because the extra spending would not be linked directly to increased production. A UBI doesn’t provide the psycho-social benefits of secure paid work. A UBI would be used by employers as a wage subsidy.

    1. covenanter

      Nicholas, while it helps to argue alternatives, there was a sort if job guarantee during the Great Depression, people were not just given something for nothing but men, mainly, were anecdotally employed moving one pile of gravel to another with shovels so that their families might eat. Other responses around the globe at the time led to a World War.
      But the problem of inflation with UBI is matched with people being forced into useless and unproductive work in a “Job Guarantee”, much like the Work For The Dole schemes. “Real” work done by real companies under competition, will scream that taxpayers are funding their competition and putting them and their workers out of business.
      And just for example there are regions in Australia where long-term unemployment exists and where a defacto UBI has long been in place. Most of that money goes to support existing local businesses, or businesses that in that region might otherwise not even exist.
      Those “Agrarian Socialists”, in the regions, will be hard put to counteract The Greens promotion of UBI in the regions, but could easily counter argue the jobs guarantee.
      Regional employers will certainly offer lower wages, they already do to backpackers and 457 workers, but a UBI will allow the locals to become employed casually, and intermittently, while still being able to pay the rent, (which they cannot do now). Just some thoughts in reply.

    2. Draco Houston

      ‘JG’ is even more magic pudding than UBI. Decrease the working week and allow the economy to restructure around an increased number of better jobs. Or we can dig a hole and fill it back up again I guess!

      1. Charlie Chaplin

        Apparently reducing the working week works really well- providing the hourly wage rate doesn’t go up. People would be working less hours for less money. How will that help? How will less money stimulate more demand and an increased number of better jobs?

  9. Jack Frost

    Think big? OK. A UBI is the ultimate tool for silencing dissent. Universal, one day, but unconditional? Never.

  10. allen brown

    In the 1970s in Canada, the government ran an experiment of UBI by giving it to an entire rural town, and analyzed the results. They were all positive: better physical and mental health, better education for the kids … the list goes on. See chapter 22 of Johann Hari’s book, “The Lost Connections: uncovering the real causes of depression – and the unexpected solutions”. See also Huffington Post, 3/01/17: “A Canadian city once eliminated poverty and nearly everyone forgot about it”.

    1. [email protected]

      Thanks Allen
      Exactly what we need in the conversation and what Bernard, who usually is more comprehensive in his analysis, just disregarded. And it is not the only example.


    2. Charlie Chaplin

      If you mean the Dauphin, Manitoba mincome experiment in the 1970s, they didn’t give it to “an entire town” at all, they gave it to 1000 families who were already below the poverty line. It was targeted welfare- not a UBI.

      The Huffpost article you referred to states it went to the poorest families only:

      ” Between 1974 and 1979, residents of a small Manitoba city were selected to be subjects in a project that ensured basic annual incomes for everyone. For five years, monthly cheques were delivered to the poorest residents of Dauphin, Man. – no strings attached.”

      The headline, ” A Canadian City Once Eliminated Poverty And Nearly Everyone Forgot About It”,  is misleading. Dauphin was a small town, not a city. It’s still a small town- 8,475 people lived there according to the 2016 Census.,_Manitoba


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