The Guardian view on basic income: a worthwhile debate, not yet a policy
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Version 0 of 1. For centuries, the idea of a universal basic income – a regular sum paid to all citizens or residents whether or not they are in work – has lit up the eyes of political philosophers. It has long been favoured on the political fringes, appealing to the radical left for its supposed compatibility with a zero-growth world and its reward for caring, and to the libertarian right as a way of rolling back the state. But in the last couple of years, the basic income has suddenly forged a path from academic seminar room to on-the-ground trials. Here in the UK, it has been championed by the RSA thinktank, and the city of Glasgow is now considering a pilot. Across the continent, experiments are running in Finland, Italy, and the Netherlands, and it is a key plank in the platform of Benoît Hamon, the socialist candidate for French president. The idea has roots in the Roman empire – where the plebs got free grain. A basic income has been dusted off as an old answer for a brave new world, in which clever robots gradually replace a significant number of existing jobs, from customer service agents to taxi drivers. Economists are divided on whether this will create a futuristic dystopia (or utopia) in which there is too little work to go round. Our ageing population means new jobs will certainly be created in sectors like care that require – at least for now – uniquely human skills like empathy. The steady advance of technology is likely to exert a downwards pressure on the wages of many. In a world where our welfare system has evolved from being based on the principle of unemployment insurance to providing a permanent top-up to wages set so low they provide insufficient means by which to support a family, the basic income has an elegant simplicity. Why not pay everyone the equivalent of a basic safety net, and dispense with the clunky bureaucracy of the benefits system altogether? It could empower workers to get a better deal from employers, give them the flexibility to retrain, and eliminate the pernicious poverty trap altogether, or so the argument goes. Theory is easier than practice. Set the basic income too low, and far from empowering workers, it could act as a wage subsidy, allowing employers to hold salaries down, as many argue happened with tax credits. Too high, and while it might transform power relationships in the workplace, giving people the freedom to turn down low-paid work, it might prove a disincentive to working altogether. And that’s before we consider how it might be paid for. Even the RSA’s moderate proposal for a basic income of £3,700 a year would cost upwards of £12bn extra a year if it included a guarantee that families with young children would not lose out. Would this be money better spent on the NHS, schools or childcare? Would basic income be part of a lasting welfare settlement? There’s a risk that it could be eroded over time – just look at what happened with tax credits. There are other practical considerations: if entitlement was limited to citizens and long-term residents, this would require the creation of an alternative safety net for recent migrants and refugees – surely a political minefield in the current climate. The realities of today’s labour market for too many are growing earnings inequality, stagnant wage growth and gnawing insecurity. Whatever basic income’s merits, it doesn’t answer the difficulties of the moment. It is an interesting idea whose time has not yet come. |