Forum Final Response
With Responses From
May 15, 2017
8 Min read time
Basic income without social insurance may do more harm than good.
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Among the thoughtful and generous responses to my essay, there is a recurring objection to my argument that we should be clear about the limits of basic income.
I recognize that few academics, activists, or commentators view basic income as the sole reform needed for economic justice, and I did not mean to suggest otherwise. I did mean to suggest that the net effects of any basic income would depend on its institutional design and on surrounding policies and institutions—especially labor and employment laws, in-kind public benefits, and the state’s role as an employer. And I did mean to suggest that those surrounding policies and their effects on corporate power and workers’ lack of power have not received enough attention in either the popular basic income debate or the broader debate around the future of work.
Passing a basic income without sound social insurance programs may do more harm than good.
This is especially true in and around Silicon Valley. Roy Bahat is right to emphasize that our old regulations of work are not as helpful anymore—but then why not change them? I have not seen a single quote from a tech leader or thinker to the effect that “basic income is a great idea, but we also need a high minimum wage and much stronger unions.” In fact, while I was drafting this response, Harvard Business Review published a piece tracing how information technologies have exacerbated income inequality by encouraging outsourcing and the growth of new mega-firms. But its proposal to help low-wage workers is through a negative income tax; it never once mentions minimum wages or collective bargaining.
Similarly, while I agree with most of Philippe van Parijs’s nuanced response, I disagree in part with its assessment of the problems of work. For example, workers choosing between jobs do not necessarily “possess the relevant information” about those jobs’ prospects and conditions, as van Parijs attests. The new management techniques I surveyed suggest that workers actually have less unique information about jobs these days, particularly—as Annette Bernhardt points out—when online labor platforms forbid them from communicating with one another.
Who does have such information? Google, Uber, Amazon, Walmart, and other mega-firms inside and outside the tech sector. A basic income would not close this knowledge gap, nor would it make it significantly easier for workers to close it through deliberation, since that requires concerted action that is difficult under current law. In fact, I worry that this knowledge gap simply cannot be closed. Data analytics are too advanced. Protecting workers may require more heavy-handed regulation, and what Joshua Cohen and Joel Rogers have called a “deliberate politics of association,” in which the state positively encourages unions and organizations as sites of countervailing power.
There are of course valid reasons to embrace tax-based strategies rather than regulatory ones: concern for the unemployed, skepticism that unions can ever reorganize, and the fact that the U.S. model of unionization, as van Parijs rightly observes, tends to help certain workers more than others in morally arbitrary ways. Plus only a fool would expect the business community in the United States to enthusiastically back labor’s cause.
But—and this is a key point—the law does not just regulate economic activity. It also enables and shapes economic activity in the first instance. As we evolve from industrial capitalism toward informational capitalism, ever-smaller workplaces, part-time work, and self-employment are not inevitable. Rather they reflect firms’ responses to legal rules. Legislatures and courts have chosen to limit firms’ employment duties and unions’ powers to strike, which encourages outsourcing and other sorts of precarious work. As Diane Coyle points out, Uber drivers do much better in some legal environments than in others.
We cannot pass an egalitarian basic income in the United States without changing the power structure.
In a culture in which these political-economic effects of law are largely ignored, Silicon Valley’s enthusiasm for basic income is having some detrimental effects on the ground. When foundations and think tanks flood the zone with research into the “Future of Work” (now a genre of its own), research into the realities of work today can go unfunded. That has happened to some of my colleagues. Similarly, as it becomes common sense that workers’ largest challenge is automation, basic labor standards and worker organizing seem futile since higher wages will just hasten the robots’ arrival. This is a false choice. I agree strongly with Coyle and Bernhardt that those concerned about inequality should embrace technological development and steer its path.
I even hold out hope that at least some in Silicon Valley could move toward this agenda, or accommodate it if they must. Flexicurity is, after all, still capitalist. Danish employers can hire and fire workers at will, just as they can in the United States, and the country embraces free trade and innovation. It even just appointed an ambassador to the tech sector. And while Danish unions are quite powerful, they do not typically bargain over work rules, but rather set high minimum standards and then leave firms free to manage. If part of Silicon Valley’s skepticism toward unions is a function of peculiarities of U.S. labor law, more awareness of alternative labor law models might change things.
In other words, I would love it if “Flexicurity Bros” became the new “Basic Income Bros.”
For now, though, am I really mistaken that some proponents’ love for basic income leads them to overestimate its promise? Juliana Bidadanure ends her essay by arguing that basic income “has an unequalled potential to foster convergence” between otherwise atomized groups and individuals, and to “be the cornerstone of a powerful alternative progressive imaginary.” Not “a” cornerstone but “the” cornerstone—the foundation upon which other ideas must build.
Dorian Warren ends up in a similar position, drawing from black political traditions and the racial capitalism literature to argue that U+BI could be the centerpiece of a multiracial campaign for economic justice. I fully agree that race neutrality is not a means to economic or racial justice, especially in the United States. But I chose many of those policies specifically because their effects would not be race-neutral. A job guarantee, heavy investment in local infrastructure, expansion of social insurance, and social bargaining for low-wage workers would disproportionately benefit African Americans and Latinos, not to mention poor and working-class women.
In fact, my ultimate narrow defense of a basic income—or perhaps a “base” income, in Peter Barnes’s terms—is rooted in my hope that it could help us move past our racialized approach to welfare, which Tommie Shelby and Connie Razza also illuminate and condemn. On a related note, Bidadanure and Warren both rightly argue that the threat of a xenophobic basic income is a reason to resist xenophobia, not to abandon basic income.
To be clear, I agree fully with Bidadanure—and Warren, van Parijs, and many others—that “everyone should have an unconditional right to be free from basic economic insecurity.” I just disagree that organizing around basic income is obviously the best strategy to advance that goal in the United States.
Am I mistaken that some proponents’ love for basic income leads them to overestimate its promise?
Why? First, because a basic income cannot substitute for social insurance, and social insurance remains meager in the United States. Lack of health care, housing, childcare, and mental health services leaves millions economically insecure. Providing those goods to all citizens or residents will also create jobs and perhaps a more highly skilled workforce. In fact, passing a basic income without sound social insurance programs may do more harm than good. The situation is of course different in many European countries.
Second, and at the risk of sounding like a broken record, we cannot hope to pass an egalitarian basic income in the United States without changing the power structure. Which of the following seems more plausible: that a multiracial movement of the poor and precarious will make common cause with tech billionaires to pass an egalitarian basic income; or that a multiracial movement of the poor, precarious, and middle class will push for and achieve better health care, childcare, education, and wage per hour laws? Then take on harder fights, for a new collective bargaining model, a public jobs guarantee, and cash benefits for parents? And then still harder fights, such as a generous basic income?
History does not repeat itself, but it does rhyme. If progressive politics has a new imaginary, it is an iteration of the old imaginary that made capitalism relatively fair in the postwar period: social democracy. Or, more precisely but less succinctly: racially egalitarian, feminist, and ecologically sustainable social democracy. Such a model would have many cornerstones, including economic security, worker empowerment, fair equality of opportunity, reproductive rights, an end to mass incarceration, meaningful opportunities for democratic engagement, and a real strategy on climate change.
Sometimes those goals will be in tension. Sometimes the change agents—new unions and citizen organizations—will need to be built from scratch, generally through battles to pass reforms. But unlike basic income, majorities intuitively support most of these goals—they are rooted in our political traditions, and they directly address power disparities, as Patrick Diamond, David Rolf, and Corrie Watterson show. Pushing them will alienate some libertarians, but that is politics. And doing so may enable different political coalitions, for example with religious voters committed to economic and social equality.None of this means we should abandon basic income research or organizing, or that we should give up on steps toward it. These include universal child credits, elder credits, and even state-level efforts in places such as California, where labor and the left are already strong. But it does mean we should, as I wrote, “be clear-eyed about the policy’s justifications, merits, and limits.” That, in my view, is the path to economic security for all.