Extract from ABC News
Photo: A UBI of $15,000 or $20,000 a year is not going to lead a mass exodus from the labour force in Australia. (ABC News: Stephanie Anderson)
A universal basic income (UBI) is a simple idea: a periodic cash payment unconditionally delivered to all on an individual basis, without means-test or work requirement.Scholars, activists, and politicians are increasingly becoming aware of the radical potential a UBI could have for societies around the world: from economic security, fairer wealth distribution, justice and poverty eradication and gender equality.
However for a simple idea, the UBI has created a lot of confusion lately. Writers from the left and the right have stumbled over some its most basic aspects.
I want to clear a few of these up.
Basic income is much more than what the right espousesIt is true that UBI has had resonance across the political spectrum.
Tim Roxburgh tries to make sense of the push for a universal basic income.
Milton Friedman wanted to replace the welfare state with giving people vouchers so people could pay for what they needed. This view of UBI is dangerous as it is deeply commodifying and there is no guarantee that a subsistence wage would cover the cost of items like medical treatment and education.
It also fails to engage with notions of unfreedom inherent in capitalism — something also overlooked in the proposals coming from Silicon Valley elites and friends.
Instead, we need to understand UBI as a radical redistributive mechanism — one that works to redistribute wealth so all can enjoy economic security as a basic human right.
We must see the UBI not as a grant, but a social dividend from wealth collectively created, or what Stanford's Professor James Ferguson calls a rightful share. A UBI as a rightful share would go along side other social services, such as health, education, housing and disability support.
Photo: Formal work as it is currently defined overlooks the unpaid creative work carried our by our artists. (1 News Express)
A UBI won't stop people from workingSome critics of UBI have argued that it disincentivises work. But a UBI of $15,000 or $20,000 a year is not going to lead a mass exodus from the labour force in Australia. People will still be able to work if they are lucky enough to find a job.
There is evidence for this: the 1960s and '70s Negative Income Tax trials in North America showed only a small decrease in labour market supply. The people delayed in returning were mainly women re-entering the workforce after having children or young people staying longer in education.
For those in paid work, a UBI gives an unconditional economic base that improves workers bargaining power. A UBI means if people want to withdraw or suspend their labour from exploitative or oppressive conditions, they can without the fear of destitution.This is important as the GIG economy, labour precariarity, and attacks of collectively mobilised labour and unions are increasing. The UBI gives people the freedom to say no to get a better deal for their labour.
However the fixation on how a UBI will effect labour market demand is short sighted — the availability of formal and dignified employment is dramatically eroding, and there simply aren't enough secure and dignified jobs for everyone.
Also, formal work as it is currently defined is very limited. It overlooks all the productive unpaid labour that people do — from the reproductive work (mainly women) do in raising children, to the important work some First Nations people undertake in caring for country and the unpaid creative work carried our by our artists.
UBI isn't utopian and implementation is possibleThere are different ideas about how to implement a UBI.
John Quiggin from the University of Queensland outlines a "stepping stone" approach where either basic or universal is preferenced first in the implementation process (and the other added over time).
For example, a universal focus (before basic) means implementation will begin with a small universal payment for everyone, the amount gradually increasing over time to the point where it becomes sufficient to meet basic needs.
A basic (over universal) implementation starts with one group (such as young people) who are first given the full basic income, and other groups are added to this over time to make it universal — an approach preferred by Quiggin and outlined by Troy Henderson (University of Sydney) and Ben Spies-Butcher (Macquarie University).
The basic income is expensive, but not too much so
Photo: The UBI is not a panacea and needs to accompany many other important measures. (Marilia Ogayar, file photo: AAP)
Some of the calculations floating around about how much a UBI will cost are misleading. The error here is that the cost of UBI is presented as the gross cost (i.e. the size of the proposed basic income multiplied by the population size), rather than its true net cost (i.e. the proposed size of the basic income multiplied by the number of net beneficiaries, without counting the net contributors paid through redistributive tax).
The UBI is not a standalone measure as it interacts with the tax system to redistribute wealth.
Also, the cost would be eased in over time if the UBI were implemented in the staged "basic" approach.
The UBI is not a panacea and needs to accompany many other important measures — dignified employment creation, redistributive tax reform, shorter working hours, housing, universal healthcare and education, and increasing union's bargaining powers — just to name a few.
Elise Klein is a lecturer in development studies at the University of Melbourne.