Should everyone be paid a basic income?

In a cavernous and cold Glasgow hall last week Prof Guy Standing from the famed School of Oriental and African Studies at the University of London outlined the imperative of providing a basic income to all adults in Scotland – least I assume its all adults since I cant imagine he is proposing that such an income should be paid to every adult and every child. Whilst speaking for over 40 minutes Standing did not actually say how much money should be paid as a basic income -though he did say that the objection that society can’t afford it is non-sense. Listening to Standing you might end up thinking that society can’t afford not to pay a basic income.

When he first outlined his theory over twenty years ago the proposal was lampooned as nothing short of economic and political madness. Now he finds himself invited to present at the World Economic Forum in Davos and chatting side by side with Al Gore -the former US vice president –who, he says, told him that he would need to give the idea of a basic income serious further thought after listening to Standing. For those who don’t know what this is the suggestion is that all adults should be given a basic income whether in work or out of work and that the amount paid should be guaranteed irrespective of what other sources of income an individual might receive. 

For those who say that a basic citizens income is likely to breed laziness Standing quotes the results of having piloted the idea in a variety of developing countries. The outcome of these pilots, he says, is not epidemic levels of laziness but emancipation of women who for the first time may have a guaranteed income that reduces their dependence on men, greater reward for those whose labour is directed at caring for others who are incapitated in some way, and  greater willingness to engage in educational activities. In a nutshell the basic income idea has much to recommend it. 

Standing’s suggestion of a basic income has attained greater prominence in recent years as the topic of societal security has come to the foreground in both political and public thinking. According to Standing, capitalist countries are increasingly finding themselves creating what he calls a "precariat class" of people who have less and less invested in society’s structures and whose sense of frustration and vulnerability over time over time (and that may not be a long time) is likely to lead to the creation of extremist, far right groups and leaders whose demagoguery may take a distinctly populist but dangerous direction – think Donald Trump and you start to consider that Standing may be more clairvoyant than social observer. 

The idea of a basic income will be hard to swallow for some, not least because of its likely cost but also because it would involve paying benefits to people who are in no need of additional money. And here is the rub: pay it to everybody and the level at which the income is set, has to be relatively modest (think child benefit). Pay it to those in greatest need and the amount can go up quite considerably but then you have to get into some kind of means testing.

If you are forced to make the benefit paid relatively modest as a result of fashioning it as a universal payment, you might at the same time be undermining what may be truly radical and powerful about the idea. Child benefit helps many people but the level at which it is set, does not cover the full costs of bringing up a child. As a result, the benefit does not lift people out of poverty it simply eases some of the costs of having a child. For those who are already reasonably wealthy it is a nice but unnecessary addition to their household income. Perhaps a better alternative than an assured, modest benefit paid to everybody would be to pay a substantial basic income to those groups in greatest need to pay that benefit for a guaranteed period, say ten years. That is a proposal that would truly lift people out of poverty and allow those in greatest need to reach their greatest potential.

Whilst Standing’s advocacy for what many might regard as a utopian ideal is impressive, it is questionable whether at a time of austerity he will succeed in encouraging even those countries that have piloted the suggestion to roll it out as a national programme. The idea has a Scandinavian ring to it - countries that are both successful and which embrace an ethic of egalitarianism seem tailor made for the policy. Those countries that have no commitment to public benefits or who, like our own, make the process of securing those benefits as torturous and as contingent as possible, seem unlikely to do more than flirt with the idea whilst showing no inclination to implement it. 

Still, if it was not for the passionate advocacy of folk like Guy Standing perhaps we would not even be noticing, let alone discussing, the needs of those who are not only far away from the dream of financial stability but moving rapidly in the opposite direction from it. 

For those who wish to know more about the idea of a basic income and its affordability (or not) see:  The Corruption of Capitalism: Why Rentiers Thrive and Work Does Not Pay (Biteback, 2016)

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