Critical Reflection
What is a Universal Basic Income?
Different forms but a basic premise:
Provides insurance against income insecurity for all citizens.
Most likely delivered in the form of a demogrant
A non-taxable benefit paid regularly to citizens
Examples of a demogrant are the Canada Child benefit or Old Age Security
Not a new idea
The concept of some form of income guarantee dates back to as early as the 16th century
In the late 18th and early 19th century, the idea of a basic income re-emerged and the ideas of mathematician and political activist, Antoine Carital influenced the development of Europe’s massive social insurance systems.
To every person – “rich or poor”
Building on the idea of Carital, Thomas Paine proposed a basic income, insisting that payment should be made “to every person, rich or poor”, “because it is in lieu of the natural inheritance, which, as a right, belongs to every man, over and above the property he may have created, or inherited from those who did
Utopian Socialists: mid 19th century
Charles Fourier’s right to subsistence: an unconditional entitlement for the poor by way of compensation for the loss of direct access to natural resources.
Joseph Charlier’s territorial dividend: he proposed every citizen had an unconditional right to a quarterly (later, monthly) payment of an amount fixed annually by a representative national council.
John Stuart Mill: a certain minimum assigned for the subsistence of every member of the community, whether capable or not of labour.
20th century
Bertrand Russell (1872-1970): argued in the early 1900s for a social model that combines the advantages of socialism and anarchism. One central component a UBI “sufficient for necessaries”.
Dennis Milner (1892-1956): Member of the Labour Party published jointly with his wife Mabel a short pamphlet entitled “Scheme for a State Bonus” (1918). They argued for the introduction of an income paid unconditionally on a weekly basis to all citizens of the United Kingdom
Social credit/national divident
Clifford H (“Major”) Douglas (1879-1952): Proposed in 1942 the idea of a “social credit”. A monthly “national dividend” paid to all households. The social credit movement enjoyed varying fortunes. It failed to establish itself in the United Kingdom but attracted many supporters in Canada, where a Social Credit Party governed the province of Alberta from 1935 to 1971, although it rapidly dropped the idea of introducing a national dividend.
Three American approaches in the 1960s
Robert Theobald (1929-1999): with his Ad Hoc Committee on the Triple Revolution (1964) defended in various publications a vaguely specified guaranteed minimum income on grounds reminiscent of Douglas, such as the belief that “automation is rendering work for pay obsolete, and that government handouts are the only way to give the public the means to buy the immense bounty produced by automatons”.
Negative income tax
Milton Friedman: In his popular book Capitalism and Freedom (1962), the conservative economist proposed a radical simplification of the American Welfare State through the introduction of a “negative income tax”. It was offered as a simple and radical alternative to the patchwork of existing social welfare schemes.
Guaranteed minimum income
3. James Tobin (1918-2002), John Kenneth Galbraith (1908-2006) and other liberal economists proposed in the 1960s the idea of a guaranteed minimum income that would be more generous and less dependency-creating than the existing assistance programs.
Tobin’s demogrant
Tobin et al published the first technical analysis of negative income tax schemes in 1967, where they came out in favor of a variant involving an automatic payment to all citizens – a genuine UBI which Joseph Pechman proposed calling a demogrant. In contrast with Friedman’s proposal, Tobin’s demogrant scheme was not meant to replace the whole system of social assistance and insurance schemes — let alone to help extinguish the welfare state altogether.
Under Tobin’s more generous proposal, each household would be granted a basic credit at a level varying with family composition, which each family could supplement with earnings and other income taxed at a uniform rate.
In the Spring of 1968, Tobin, Galbraith and other economists (not Friedman) proposed the implementation of Tobin’s proposal. In a context in which dependence on the existing welfare system was increasing dramatically, the conservative Nixon administration felt pressure to move ahead. This led to the Family Assistance Plan (FAP), an ambitious social welfare program prepared by the democrat senator Daniel Patrick Moynihan (1927-2003).
Too bold? Not bold enough?
The FAP provided for the abolition of the aid program targeting poor families (AFDC) and incorporated a guaranteed income with financial supplements for workers which came close to a negative income tax scheme. It was publicly presented by President Nixon in August 1969, adopted in April 1970 by a large majority in the US House of Representatives, rejected by the relevant Commission of the US Senate in November 1970, and definitively rejected in 1972, despite several amendments meant to assuage the opposition, owing to a coalition between those who found it too timid and those who found it too bold.
Martin Luther King and the Poor Peoples Movement
Shortly before his assassination in 1968, King was involved in organizing the “Poor Peoples Campaign” march to Washington to call on the government to implement a guaranteed annual income.
The Poor Peoples Campaign continues to advocate for a fair, robust basic income for all.
A more ambitious “demogrant” plan was included by the Democrats in the 1972 presidential election, but dropped in August 1972. Combined with McGovern’s defeat by Nixon in November 1972, the beginning of the Watergate affair in March 1973 and Nixon’s resignation in November 1974, the defeat of the FAP in the Senate marked the end of the short but strong appearance of UBI-type ideas in the US debate.
Charles Murray “blaming the poor”
In the 1980s, American Charles Murray proposed a basic income scheme that would replace the existing welfare state.
In his 1984 book, Losing Ground argued for a minimal income the elimination of all other programs designed to help the poor
Later publications revealed Murray’s racist beliefs
Other Contemporary approaches
In the 1970s, Manitoba experimented with a Basic income (mincome)
In Canada, the Macdonald Commission proposed a type of guaranteed annual income in the 1980s which was rejected by progressives.
Different types of basic income have been explored in Europe.
We will explore some of these
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What does this history tell us?
The idea of some sort of income guarantee is not new.
The ideas range from conservative efforts to dismantle the safety net to progressive models that would enhance other public services.
Our challenge in this class it to understand what a progressive basic income might look like in Canada and determine whether it is possible.