Sunday, 2 April 2017

A UBI "social account"

"Can UBI work?" asks Kemal Dervis at Social Europe

"Implementing a full-blown UBI would be difficult, not least because it would require answering a number of complex questions about goals and priorities," he says. "Perhaps the most obvious balancing act relates to how much money is actually delivered to each citizen (or legal resident)."

"In the United States and Europe, a UBI of, say, $2,000 per year would not do much, except perhaps alleviate the most extreme poverty, even if it was added to existing social-welfare programs. An UBI of $10,000 would make a real difference; but, depending on how many people qualify, that could cost as much as 10% or 15% of GDP – a huge fiscal outlay, particularly if it came on top of existing social programs."

However, a proposal from France "is a step in the right direction," Dervis argues.

"The idea is to endow each citizen with a personal social account containing partly redeemable 'points.' Such accounts would work something like a savings account, with their owners augmenting a substantial public contribution to them by working, studying, or performing certain types of national service.

"The accounts could be drawn upon in times of need, particularly for training and re-skilling, though the amount that could be withdrawn would be guided by predetermined 'prices' and limited to a certain amount in a given period of time.

"The approach seems like a good compromise between portability and personal choice, on the one hand, and sufficient social-policy guidance, on the other," Dervis adds.

"Only by striking the right balance between individual choice and social-policy guidance can modern economies build the social-safety programs they need," he concludes.


Getting Basic Income Right (Social Europe)

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