With Responses From
May 15, 2017
5 Min read time
We should be focusing on base income.
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Brishen Rogers argues that basic income, though appealing, is not a one-stop policy solution. He is not against basic income per se; in fact he rather likes it. He is just against a standalone basic income.
Well, fine—who could disagree? No single policy can fix everything. But in making this particular argument, he overlooks an important distinction. At this time, when massive technological unemployment is an interesting future scenario but far from a sure or imminent reality, we should not be focusing on basic income. Rather, we should be focusing on base income, which would address a number of immediate problems while avoiding the pitfalls of the more ambitious iteration.
We should not be focusing on basic income. Rather, we should focus on base income.
What is the difference between the two levels of universal income, and why does it matter? A base income of, say, a few hundred dollars a month does not have the same economic, political, and moral ramifications as a basic income of, say, $1,000 a month. The latter, at least in some places, offers enough to survive on; the former decidedly does not. And while the latter is a dream of many, it is far too expensive—and threatening to our work ethic—to be enacted in the United States any time soon. What is more, if it eventually does happen here, it will only be because it was preceded for many years by a universal base income. So let’s focus on what is useful and possible in ten to fifteen years, rather than what is theoretical and, at best, several decades away.
The first advantage of a base income is that it has a proven American model to draw from. In Alaska, an oil-based Permanent Fund has paid yearly dividends to every resident (adult and child) since 1982. The payments have been in the vicinity of up to $2,000 a year. With more than three decades of data to draw on, an analysis by Ioana Marinescu of the University of Chicago shows that employment and wages in Alaska have followed the same trajectory as in comparable states without a universal income. The only exception is that about 2 percent of Alaska’s work force appears to have shifted to part-time work, reflecting the added flexibility that extra income affords. And that is arguably a good thing.
On a national level, a base income would serve as both a springboard and a safety net for every participant in our fast-changing economy—like giving every player in Monopoly $200 for passing Go. It would supplement, but does not replace, labor income, and does so without judgment or stigma. It is grounded on the principle that, in a prosperous but volatile and wealth-concentrating economy, everyone has a right to some cash flow they can count on.
In practical terms, a national base income would be easy to administer. Eligible recipients (anyone with a valid Social Security number, which can include legal immigrants) would get equal amounts of money wired to their bank accounts or debit cards every month. People who don’t need the extra income could use a check-off option to donate it to an IRS-approved charity, or simply not register in the first place.
Base income would serve as a springboard and a safety net—like giving every player in Monopoly $200 for passing Go.
A base income, it should be noted, has nothing to do with robots or artificial intelligence. It has a lot to do with enhancing every American’s financial security, reducing their stress, and giving the poor and middle class a leg to stand on—the very opposite of what our economy does now.
A base income would have other benefits as well. It is an answer—perhaps the answer—to long-term economic stagnation, a trickle-up form of Keynesianism that would stimulate our economy through increased household spending.
Moreover, if funded by fees on unproductive activities such as pollution and speculation, it would help solve two other deep problems of twenty-first-century capitalism: climate change and financial instability. And it would not need to replace existing means-tested benefits, a regressive trade-off that conservatives favor but most progressives oppose. Indeed, fighting for a base income can go hand-in-hand with fighting for a bigger public sector, stronger collective bargaining rights, and a host of other policies. We can walk and chew gum at the same time.
Are there any downsides? The two leading objections to a full basic income are that it is frighteningly expensive (paying every American $1,000 a month would consume 20 percent of GDP), and that it would turn us into a nation of slackers. Neither of these critiques applies to a base income. Its cost would be on the order of 5 percent of GDP—the equivalent of the cost of Social Security—and its impact on the work habits of Americans would range from neutral to positive, as seen in Alaska.
Finally, there is the argument that a base income is the logical next step of the progressive path we have been on since the New Deal. Eighty-two years ago Franklin D. Roosevelt’s Committee on Economic Security produced the report that led to passage of the first Social Security Act. The report itself went beyond security for the aged. It proclaimed:
The one almost all-embracing measure of security is an assured income. A program of economic security, as we vision it, must have as its primary aim the assurance of an adequate income to each human being in childhood, youth, middle age, or old age—in sickness or in health.
The committee went on to say that, for reasons of political expediency, it was calling for immediate action only with regard to old age security, but it hoped that the rest of its vision would be implemented in the not-too-distant future. Much of it has, but not all. A lifelong base income, along with health insurance for all, are the overdue next steps.