UBI and the Work Ethic
A response to "A
Basic Income for All"by Philippe van Parijs.
General Motors is expecting sales
approaching 150,000 per year for the Hummer, a four-seater vehicle of
military origin that is more than seven feet wide, weighs more than
seven thousand pounds, and scores extremely poorly on fuel efficiency
and pollution criteria. Designed to scale vertical walls twenty-two
inches high, its road clearance makes it liable to override the bumpers
of a car in a collision, thus enabling its weight (about three times
that of a car) to do maximum damage to the cars occupants. And
where does General Motors hope to sell these juggernauts? "Youll
see a lot in New York City, places like Manhattan where your affluent
buyers are," the New York Times quotes the general manager
of Hummer operations as saying. "Paul Bellow, GMs general
director of market analysis, said that the rising concentration of wealth
and income in America over the last two decades had been the most important
social trend for automakers. A very large class of high- income, fairly
youthful households had been created, he said, and these people care
little about gasoline and other vehicle operating expenses"or,
presumably, the $93,000 price tag that General Motors is proposing to
attach to the Hummer.1
What would be needed to make this kind of antisocial toy a commercial
non-starter? Any solution must proceed in two directions. One is the
taxation of income, wealth, and inheritance to offset the huge gains
made at the top end of the distribution of income in the past twenty
years, and the other is to bring the tax on gasoline at least up to
Western European levels. These two measures are desirable in themselves.
Moreover, backed up by other "green" taxes to cut energy use,
they would generate so much revenue as to go much of the way towards
answering the usual first question about any basic income proposal:
"Wheres the money to come from?" The notion that the
money raised should go to everybody equally could appeal to both right
and left, the one because the money is not spent on government programs
and the other because it helps most those with the least. This is not
to deny, of course, that there are other places in the world in which
a subsistence-level basic income for everybody (even by local standards
of subsistence) could probably be achieved only by transfers from outside.
I believe that a compelling moral case can be made out for the proposition
that poor countries whose public administration is honest and competent
enough to deliver a basic income should be helped to do so by rich countries
in a systematic way. I shall, however, follow Van Parijs in focusing
on the United States, with some side-glances at Western Europe.
It need hardly be said that it is one thing to identify where the money
could come from and another to explain where the political motivation
to raise it is to be found. A time of serious proposals to cut income
taxes, abolish the inheritance tax, and even reduce the gas tax is less
than propitious. We should bear in mind, however, that sometimes things
move a lot faster and a lot furtherand a lot soonerthan
is generally expected. In politics, as in geology, seismic events resist
prophecy. In a spirit of speculation, however, let me mention three
conceivable ways in which a move to a universal basic income could be
Imagine, then, some kind of really dramatic evidence of global warmingthe
disappearance of a medium-sized Pacific island under the sea, for example.
This just might jolt public opinion into support for massive energy
taxes. Returning the revenue to everybody equally would just by itself
constitute a basic income at some level or other.
A second candidate is a revulsion against the "war on drugs,"
which currently incarcerates more people than are in jail from all causes
in the European Union, which has a hundred million more inhabitants.
Of course, the thought of the prisons being emptied and a lot of young
or youngish unemployed (and maybe hard to employ) males returning home
might well send shivers up some spines, but at the same time shutting
down most of the prisons would make a great deal of money available.
If we want to identify a forerunner to basic income in American politics,
Richard Nixons Family Assistance Plan is, I suggest, more relevant
than anything mentioned by Van Parijs in that it almost became law.
Its architect, Daniel Patrick Moynihan, made no bones about the cynicism
of its motivation: paying people not to work is cheaper than job-creation
schemes, and buying off violence is cheaper than suppressing it. Both
of these maxims retain their validity and could lead to a revival of
interest in unconditional income support if concern for the stability
of the inner cities resurfaced.
Finally, the inequality of income and wealth may become so great, with
so much money in the hands of such a small proportion of the population,
that the logic of electoral competition will impel the Democrats to
play the redistribution card. That leaves open the question of the form
redistribution might take, which is precisely why the pros and cons
of basic income need to be argued during an unpromising period such
as the present.
Asking about the pros and cons of basic income as such is rather like
asking about the pros and cons of keeping a feline as a pet without
distinguishing between a tiger and a tabby. Basic income has very different
characteristics at different levels. Many of the advantages that Van
Parijs claims for a basic income scheme would be realized only if it
were pitched at subsistence level (or higher). Thus, for example, the
uncertainty that inhibits people from moving from unemployment benefit
(and, even more, disability benefit) would be allayed only if the unconditional
alternative were enough to live on. Similarly, only a basic income at
(or approaching) subsistence level would enable people to take time
between jobs, get more training, or start a new business. Again, workers
can refuse "desperation" jobs and women can leave abusive
husbands only if the alternative income is adequate. The same goes for
the possibility of engaging in full-time caring for children or for
elderly or infirm relatives.
Despite this, the level of basic income actually plays no part in Van
Parijss arguments for it. He says at one point that he "favor[s]
the highest sustainable such income," and adds that in the richer
countries this level exceeds a reasonable definition of subsistence.
But there is really no way of guessing what the highest level of basic
income would be in any country after all the changes in employment and
taxation had settled down into an equilibrium. If Van Parijs is right,
though, we have to ask about the pros and cons of a basic income at
a level higher than "a reasonable definition of subsistence."
These are different from those of either a basic income below or one
at subsistence level. In the end, I will defend a subsistence level
basic income, in preference to Van Parijss proposal.
Let me begin with the least demanding reform: introduction of a basic
income at below subsistence level. If we are concerned about the "Malibu
surfer" problemthe prospect of able-bodied people with employable
skills choosing to live a life of self-indulgence, albeit at subsistence
levelthen maintaining the basic income below subsistence level
solves it. Unfortunately, however, it yields only in an attenuated form
at best the advantages offered by a subsistence-level income that I
quoted from Van Parijs. Moreover, the entire apparatus of welfare benefits
would still have to remain in place, though benefits would, of course,
be reduced by the amount of the basic income. Even here, however, the
news is not all bad: in Britain, for example, the eminent economist
Tony Atkinson has calculated that even a basic income at a rate of half
the standard state benefit would take millions of people off means-tested
benefits, which are demoralizing, demeaning, and expensive to administer.
I have already listed a number of the advantages of a subsistence-level
basic income. Moreover, its relation to the work ethic is not as one-sided
as might appear at first blush. It is true that it reinstates the "Malibu
surfer" problem. But at the same time it definitively abolishes
the "poverty trap" that leads all traditional welfare systems
down the path of coercion. The point of a basic income is that, in contrast
to a conditional welfare benefit, it is not lost by taking a job. The
result is that even very poorly-paid work makes you better off than
not working. Moreover, contingent benefits criminalize a large proportion
of the population for working while drawing benefit, even though they
could not live on what this work brings in. The middle class in Britain
is engaged in mass collusion with the officially unemployed to get houses
cleaned, gardens dug, and children minded. And neither party to the
transaction normally feels the slightest guiltnor should they.
There is surely something crazy about the stipulation that those drawing
unemployment benefit must be "available for work" at any moment,
which rules out their using the time to improve their qualifications,
engage in community work, or help a neighbor while earning a bit extra.
This is, in my view, the knock-down argument for basic income at subsistence
From this point of view, the
Malibu surfers are a drawback, but one worth putting up with for the
advantages that are inseparable from the unconditionality of a basic
income. A superficially attractive way of getting at the surfers while
maintaining many of the advantages of a subsistence-level basic income
is Atkinsons proposal of a "participation income." As
one reviewer explains, "Atkinson defines participation to include:
paid employment, self-employment, full-time education or training, intensive
care work and approved forms of voluntary work."2
But this opens up a nightmarish scenario of an enormous bureaucracy
entrusted with arbitrary monitoring powers. My guess is that something
like "participation income" might be necessary politically
to get a basic income introduced, but that the expense and intrusiveness
of administering it (as well as its lending itself so easily to fraud)
would lead either to abandoning the whole experiment or moving to an
unconditional basic income.
All this presupposes, of course, that surfers really are a drawback.
For Van Parijs, they are from a practical point of view, since the more
of them there are the lower the sustainable unconditional income will
be. Clearly, his surmise that in wealthy countries the maximum sustainable
basic income would be well above any reasonable definition of subsistence
level presupposes that the proportion of the population who could contribute
significantly to the economy and choose not to would not be very large.
But what Van Parijs does not make altogether clear in his essay is
that he rejects the idea that those who take a basic income (even one
well above subsistence level) and do nothing for the community should
be subject to reproach. As Van Parijs says at the start of his essay,
he wishes to maintain that the highest possible unconditional basic
income is an entitlement derived from a theory of justice conceived
in terms of "real freedom for all." In the essay, he only
hints at the nature of this theory, laid out in his book Real Freedom
for All, and I cannot undertake to expound it in any detail here.
I can say that by "real freedom" Van Parijs means (roughly)
the ability to do what you want, and that his criterion of justice is
that the freedom of those with the least real freedom is to be maximized.
The means to real freedom so defined are resources, so (again, roughly)
this means that the resources available to those with the least should
be maximized. Those with the least are those who do nothing to generate
any income for themselves by their own efforts. Hence, the size of the
unconditional basic income is what should be maximized.
Why is this just? Van Parijs has several answers to this question.
One is that it is unfair if those who are congenitally lazy have a smaller
chance to get what they want than those who are more inclined to work.
But we do not believe that people with antisocial traits (strong dispositions
towards, say, rape or pedophilia) should have as much chance to fulfill
their desires as others, and if the wish to live at others expense
is an antisocial trait there is no reason for making special efforts
to indulge it.
Another argument is that everybody living in a country is entitled
to an equal share of "external assets," which underwrites
a 100 percent rate of estate duty. Van Parijs then extends the notion
of an "external asset" by calling on the theory of "efficiency
wages," according to which it is profitable for employers to offer
wages at above a market-clearing rate to induce employees to want to
keep their jobs. As a result, there are always some people who could
equally well do any given job and would be prepared to do it for less
than those who hold the jobs are getting. On the basis of this, Van
Parijs deduces that income tax rates should be set to produce the maximum
possible yield: people who hold the well-paying jobs are beneficiaries
of good fortune, and cannot object to having that good fortune taxed.
Putting these two taxes together produces the revenue whose amplitude
arouses such optimism in him.
The argument is unconvincing. It is hard to see why those who have
no intention of engaging in paid employment should have any claim on
the proceeds of a tax whose rationale is to offset the good fortune
of those who have well-paid jobs at the expense of others who are just
as qualified and would like to be doing them instead.
If I am right, then, the arguments that Van Parijs offers for the justice
of maximizing the size of the basic income are defective. In their absence,
I do not believe that there is any good case for pushing the demand
for a basic income above the subsistence level. Of course, the notion
of "subsistence" is still negotiable. It must be redefined
for each society, so as to include the diet, amenities, and access to
services that are widely thought to be necessary to "get along."
It should also provide the material conditions for participating in
the social and political life of the community. Something approaching
a consensus has emerged in Western Europe that an income of half the
median is, as a rule of thumb, what is needed to meet these criteria.
Endorsing, then, the proposal for an unconditional basic income at subsistence
level, let me conclude by offering that interpretation of it.
is Arnold A. Saltzman Professor in Philosophy and Political Science
at Columbia University. He is author, most recently, of Culture
for other New Democracy Forum articles.
1 Keith Bradsher, "G.M. Has High Hopes for Vehicle Truly Meant
for Road Warriors." New York Times, August 6, 2000.
2 Stuart White, "Review Article: Social Rights and the Social
ContractPolitical Theory and the New Welfare Politics," British
Journal of Political Science 30 (2000): 507-32. I can heartily recommend
this article, incidentally, for a discussion of a number of the issues
surrounding basic income and its rivals. For "participation income"
see Tony Atkinson, "The Case for Participation Income," Political
Quarterly 67 (1996): 67-70.
Originally published in the October/
November 2000 issue of Boston Review