On the Conditions of Successful Universal Basic Income

July 30, 2018

Whether universal basic income (UBI) is worthy of support depends on how it is implemented. The idea of BI is old, but one of its best-known recent supporters has been Milton Friedman. For many economists like Friedman, it is only a negative income tax that is intended to replace most or all forms of social security and public services. The result would be an ever-more privatised market-based society. This is in sharp contrast to classical social democracy, where especially health and education are seen as areas of social life that should be decommodified. [This text was originally published as a part of the One Question forum on Universal Basic Income on 30 July 2018.]

A good rationale for the UBI, or citizen dividend, has to do with justice. We all benefit from a common inheritance, for which none of us did anything. We are also living in a world when automatisation and robotisation tend to reduce the amount of available work. Further reasons for BI include increasing freedom, equality and security of citizens. BI reduces bureaucratic control and increases freedom from the compulsion to sell one’s labour power. It can also mean increasing equality of opportunity, for instance by opening up possibilities for developing one’s skills and capacities. To strengthen social security, BI needs to replace some of the existing forms of cash transfer generously enough.

The risk is that BI leads to large-scale marginalisation, thereby increasing the costs of the system. Not only our earnings, but also our social worth, rights and duties are tied to our position in the system of employment and work. BI functions best in a world of full employment where the republican virtues of participation prevail and where people are motivated to work and participate. The context of implementation is as important as its form and level.

Further questions concern the universality of UBI. Often this question is considered only in the context of a single nation-state. On the one hand, although there are many obstacles to free movements in the contemporary world system, migration is possible and in some areas, such as within the EU, entirely free. On the other hand, justice is in no way confined to a single state. Our common inheritance is global. To cope with the risk of large-scale selective immigration, and to implement principles of justice, would seem to require transnational and global forms of basic income.

At that level, however, there are competing claims about (re)distributing our common inheritance. The first priority should be an adequate basic level of education for all, implemented in such a way that the funding to realise the universal right to education would also be seen as part of the global redistribution of wealth, especially through global systems of taxation. Clearly, however, other mechanisms of transfer as well as common policies of economic development are required in order to tackle the threat of selective immigration and to make non-global systems of UBI sustainable. As our inheritance is common, our fates are interwoven.

Heikki Patomäki