Finnish UBI pilot reduces stress

Citizens receiving a basic monthly income as part of a radical Finnish pilot scheme have seen a reduction in their stress levels, according to local officials, the Independent reports.

Under the scheme, 2,000 people receive 560 euros every month for two years. Recipients do not have to report whether they are seeking employment or how they are spending the money, which is deducted from any benefits they are already receiving.

Marjukka Turunen, head of KELA, the legal unit at Finland's social insurance agency, said as well as cutting bureaucracy, reducing costs and tackling poverty, the scheme was having an indirectly positive effect on people's mental health.

“There was this one woman who said: ‘I was afraid every time the phone would ring, that unemployment services are calling to offer me a job," Ms Turunen said.

The woman was not able to work because she was caring for elderly parents.

Under the pilot, if a participant finds work, they will continued to receive the stipend, easing claimants' fears they will lose out by finding employment, the Independent says.

FULL STORY

Finland's universal basic income trial for unemployed reduces stress levels, says official (Independent)

Finland's guaranteed basic income is working to tackle poverty (Kera News)

Ontario UBI trial to begin this summer

The Canadian province of Ontario will launch a trial run of universal basic income with about 4,000 participants this summer, making it the first North American government in decades to test out the policy, The Guardian reports.

Participants in the three-year, C$150m pilot program will be drawn from the cities of Hamilton, Thunder Bay and Lindsay. A randomly selected mail-out will invite applications in the coming months, with participants screened to ensure they are between the ages of 18 and 64 years and living on a low income.

The pilot will include a mix of those who are working in low-paying or precarious jobs and those on social assistance, with participants able to opt out at any point during the three years.

Unconditional monthly payments will begin to flow this summer; single people will receive up to C$16,989 ($12,570) while couples will receive C$24,027. All participants will continue to receive child or disability benefits, if applicable, the papers says.

FULL STORY

Ontario plans to launch universal basic income trial run this summer (The Guardian)

READ MORE

Canada is launching an experiment that will give 4,000 people free money until 2020 (The Independend)

Richard Nixon's UBI plan

Rutger Bregman tells the story of US President Richard Nixon's ill-fated plan to introduce a basic income in 1969.

https://www.themonthly.com.au/blog/rutger-bregman/2017/27/2017/1493250489/bizarre-tale-president-nixon-s-basic-income-plan

Introducing UBI in the Australian context

It’s high time we take it seriously, argues Charlie Young at The New Daily.

"While the (Australian) Greens have been advocating UBI for years, earlier this month Luke Whitington, the deputy chair of NSW Labor’s Economic Policy Committee, proposed investigating a nationwide program," Young notes.

"A multitude of recent articles, research papers and government reports have started looking seriously into UBI’s feasibility in Australia. Some proposals suggest paying out between $10,000 and $30,000 per citizen per year, which is no small thing. And it doesn’t look like the idea’s on its way out.

"Left wing proponents say a UBI would reduce crime, reward hitherto unpaid labour in the home, and massively reduce gender and income inequality, while essentially eliminating poverty – as payments would likely be set above the poverty line," he argues.

One source of funding would involve "replacing elements of government welfare spending coupled with progressive taxation."

"There’s a lot of money to be saved via the elimination of the bureaucratic means-testing involved in programs like Newstart," he notes.

A UBI could help relieve in other areas, Young says "such as the manifold economic pressures of Australia’s ageing population and jobs at risk from the rise of automation."

However, he notes that UBI champions from the conservative end of the political spectrum have a different notion of it.

"Some Liberals believe UBI could replace the inefficient behemoth that is the Australian welfare system. Mikayla Novak, a senior researcher at the Institute of Public Affairs, Australia’s leading free-market think tank, argued that federal and state welfare spending could have been redistributed in 2013-14 to give 'each adult Australian resident … about $714 per month in a basic income'."

"Remember, that would mean scrapping everything, including Medicare and child support," Young warns.

Different possible funding options are available, he suggests, including former Greek finance minister Yanis Varoufakis' suggestion of taxing automation, while academic Thomas Pogge says we should put a global levy on natural resource extraction.

Land value tax as a funding stream, financial transaction taxes and carbon taxes are other possibilities, Young argues.

FULL ARTICLE

It’s time to take ‘free money’ seriously (The New Daily)

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.

SOURCE

Getting Basic Income Right (Social Europe)

The Charter of the Forest and a commons argument for the UBI

"Every student learns about Magna Carta, the ancient scroll that enshrined the rights of barons against the arbitrary authority of England’s monarchs," writes Jason Hickel at the Guardian. 

"But most have never heard of its arguably more important twin, the Charter of the Forest, issued two years later in 1217. 

"This short but powerful document guaranteed the rights of commoners to common lands, which they could use for farming, grazing, water and wood. It gave official recognition to a right that humans nearly everywhere had long just presupposed: that no one should be debarred from the resources necessary for livelihood.

"But this right – the right of habitation – came under brutal attack beginning in the 15th century, when wealthy nobles began fencing off common lands for their own profit. Over the next few centuries, the enclosure movement, as it came to be known, shifted tens of millions of acres into private hands, displacing much of the country’s population. Excluded from the basic means of survival, most were left with no choice but to sell themselves for wages for the first time.

"And it wasn’t only England. The same process unfolded across Asia and Africa and most of the global south as European colonisers staked private claim to lands and forests and waterways that were previously held in common, leaving millions dispossessed," Hickel adds. 

Indeed, the process continues in many countries, including post-colonial countries which continue to dispossess indigenous people.

In the context of the argument of a universal basic income, what's interesting is that Hickel bases his argument on a right to share in the commons.

"Critics of basic income often get hung up on how to fund it. But once we come to see it as linked to the commons, that problem becomes more tractable," he argues, giving the modern day example of  the US state of Alaska, where "natural resources are considered a commons, owned collectively by the people, so every resident receives an annual dividend from the state’s oil revenues."

Guaranteed minimum income as percentage of national income

Economists Kalle Moene, director of ESOP – the Centre for the Study of Equality, Social Organization and Performance at the University of Oslo, and his Indian-American colleague, Debraj Ray, have called for countries to set aside 10 to 12 per cent of gross national income for a universal basic income, Phys.org reports. 

"We propose a minimum income for everyone as a fixed proportion of gross national income – Universal Basic Share (UBS)," they argue. "The scheme can thereby be introduced in all countries, poor as well as wealthy. It would function in India equally well as in Norway."

In India, this sum of money would be shared among just over 1.2 billion people, and each person would then receive a wage that corresponds to the current poverty line, while in Norway this would constitute approximately NOK 90 000 ($US10,700).

"The whole point is to link the payments to the country's income level. This has three important implications," Ray argues. "Firstly, the poor receive an amount that is independent of personal income. Secondly, the amount paid is automatically linked to inflation. Thirdly, people have no need to fight for the authorities to adjust the amount to keep pace with the growth in the national income."

"Why are these proposals being made now?

"The keywords are: unemployment, inequality, globalization and automation in manufacturing. Those who own the robots rule the world. 

"The universal basic income gradually increases as technological development forges ahead. The scheme means that everyone shares in the prosperity," they conclude.

SOURCE:

https://phys.org/news/2017-03-economists-minimum-income.html