Yes, it\’s true, the liberals really do want a basic incomeMay 12, 2013May 12, 2013 Tim WorstallEconomics17 CommentsEven the classical liberals. You know, like me. previousWatch Ritchie\’s Logic herenextWell done Wigan! 17 thoughts on “Yes, it\’s true, the liberals really do want a basic income” DocBud May 12, 2013 at 8:27 am The article makes it clear why stinking, pinko liberals of the US variety want a UBI and why it is far from desirable. Why would someone who claims to be a classical liberal want it? One thing that is bollocks is the proposition that everyone gets it, rich and poor. If I pay six figure taxes, and the state then gives me back, say, 10k as a UBI, I’m still massiviely out of pocket and have entirely funded my own UBI so I’m getting nothing. By contrast, somebody who doesn’t work is getting 10k for nothing. DBC Reed May 12, 2013 at 9:03 am Did you really mean to post this article? I was looking forward to the revelation that classical liberals supported a UBI but found extensive quotation from Marx & Engels instead ,plus sneering commentary from some outfit based in Detroit – hardly an exemplar of the flourishing industrial wage system, a place which had to be rescued by State Capitalism from Obama. UBI’s of the modern type will always be limited by the boorish challenge “Where’s the money coming from?” Taxation and income redistribution are n’t going to cut it. Mark Wadsworth has a sound scheme for cross subsidising UBI with LVT (but Detroit would hardly be responsive to this treatment, being the locus of widespread abandonment). The old Basic Income system of National Dividends paid out of the Government control of money creation (now and then in the control of the banks) is just too shocking for modern people who are all good little Thatcherites who believe “If you don’t work you die.” Tecchies seem the worst for this . DocBud May 12, 2013 at 11:07 am Sneering commentary, DBC Reed? Reference to ‘good little Thatcherites is, of course, in no way sneering. Asking where the money is coming from is, I’m sure, very tiresome for those who want their free money now and are unlikely to be doing much, if any, of the funding. Just as an LVT is a great idea to those who expect their contribution to state finances to fall and the burden to fall yet more disproportionately on a small minority. Ed May 12, 2013 at 12:59 pm DocBud, Jobseeker’s Allowance is about the same per year as what we save in income tax+NI from the personal allowance, etc. I think an appropriate level of UBI plus a completely flat rate income tax (and no NI) could massively simplify all the the associated bureaucracy, as well as reducing the disincentives to work caused by the withdrawal of means-tested benefits. DocBud May 12, 2013 at 1:35 pm Ed, I’m all for a simple tax system, flat rate income taxes should be a given as progressive taxes are incompatible with democracy. However, I fail to see how giving out free money without constraints reduces the disincentive to work and how increasing the number of net free money recipients will not increase the burden on those who are net involuntary donators to the state’s coffers. NiV May 12, 2013 at 2:16 pm Some would argue that liberals want a basic skill set: – i.e. for everyone to have sufficient tradable skills to support a comfortable life. Ed May 12, 2013 at 5:22 pm DocBud, we are going to give the workshy (a minority of claimants IMO) the money anyway. We can have complicated rules that disqualify them from say Jobseekers Allowance, in which case they will claim something else instead. We are not going to literally let them starve. The problem with what we have now is: 1. The waste of time forcing people to do training or apply for jobs they don’t want. For example, the time wasted by employers shortlisting and interviewing job applicants who meet the requested qualifications but who don’t actually want the job – they just want the rejection letter so they can get their benefits for another few weeks. 2. The withdrawal of means-tested benefits can result in an effective tax rate of >100% when people start work, or when they move from a low paid job to a slightly better job. I think IDS’ new scheme is aiming to address this to some extent, but will still have an up to 60% effective tax rate and at the cost of an enormously complicated ‘real-time’ reporting of income, which may work for regular 9-5 jobs, but will likely fail for the self-employed, those with multiple jobs, highly irregular incomes, etc. So Much For Subtlety May 12, 2013 at 11:14 pm DocBud – “However, I fail to see how giving out free money without constraints reduces the disincentive to work and how increasing the number of net free money recipients will not increase the burden on those who are net involuntary donators to the state So Much For Subtlety May 12, 2013 at 11:15 pm DocBud – “However, I fail to see how giving out free money without constraints reduces the disincentive to work and how increasing the number of net free money recipients will not increase the burden on those who are net involuntary donators to the state-s coffers.” Well I am with you in general. Not to mention that whatever we pay for we get more of. If we reward people for making zero contribution to society, we will get more people who make zero contribution to society. In the long run it would be more sensible to do the exact opposite – require people to pay a minimum level of tax. But that will not happen. The solution, perhaps, is to add a requirement. If the UBI was paid as a tax credit, then people would be forced to get a job. Even if it is with no wage. Still simple to administer, but it would get people into the work force. Alas this has been tried in Australia where they had a work for the dole scheme for indigenous people. They gradually widened the definition of work to include sitting around telling stories of the good old days before White people came. 6NiV – “Some would argue that liberals want a basic skill set:  i.e. for everyone to have sufficient tradable skills to support a comfortable life.” And what do you do with all the people in Britain who have chosen not to aquire a skill set? So Much For Subtlety May 13, 2013 at 12:01 am DBC Reed – “I was looking forward to the revelation that classical liberals supported a UBI” Well Milton Freidman did. Not quite Adam Smith but not far off it. “but found extensive quotation from Marx & Engels instead ,plus sneering commentary from some outfit based in Detroit  hardly an exemplar of the flourishing industrial wage system, a place which had to be rescued by State Capitalism from Obama.” Obama did not rescue GM and the rest of the auto makers. He rescued their Unions. He certainly did not rescue Detroit which has been pushed into bankruptcy and ruin by a very rational hatred of Whites. The Curley Effect in fact. Only WASPs can run a decent economy. When Blacks drive them out, they are left with Detroit as it is now. “UBI-s of the modern type will always be limited by the boorish challenge [Where’s the money coming from?]” Yes, God forbid someone might ask a sensible question about funding. “but Detroit would hardly be responsive to this treatment, being the locus of widespread abandonment” And why would that be? “The old Basic Income system of National Dividends paid out of the Government control of money creation (now and then in the control of the banks) is just too shocking for modern people who are all good little Thatcherites who believe [If you don-t work you die.]” Also people rightly recognise that inflationary welfare payments are suicide. No one has said if you do not work you die for a long time. Not since Stalin was in power actually. Britain has never said that at any time. But it is a problem if people do not work. If they choose not to work. And in a related question, if they are no longer encouraged to or reward for forming families and being responsible. As we see in Detroit. DBC Reed May 13, 2013 at 9:32 am @SMFB “Only WASPS can run a decent economy” Christ almighty. Tim is a Catholic I believe . Frances Coppola May 13, 2013 at 12:34 pm DBC Reed Wonkblog’s article (quoted in Tim’s link) is actually much better. Whole thing is here: http://www.washingtonpost.com/blogs/wonkblog/wp/2013/05/11/thinking-utopian-how-about-a-universal-basic-income/ FWIW I am in agreement with Tim on this. In fact I would go further. If we can find a way of automating all the unpleasant grunt jobs that no-one wants to do, that is a GOOD thing. And if having a universal basic income means that people can choose not to do unpleasant grunt jobs, forcing companies to automate instead of paying crap wages to insecure workers, that is also a GOOD thing. You lot suggesting that this would mean people would no longer have any incentive to work are neo-Luddites. Neil Wilson May 13, 2013 at 1:29 pm Basic income doesn’t work and can’t work unfortunately. It’s a pipedream. I’ve written on this today: http://www.3spoken.co.uk/2013/05/why-citizens-incomeuniversal.html DocBud May 13, 2013 at 2:12 pm Even as a neo-Luddite (a strange thing for an engineer to be but there you have it), I can see a slight flaw in your argument, Frances, it is that little word ‘if’. And then there is the neo-dumb idea that if people are only capable of doing grunt jobs then they should be able to choose not to do them and receive a UBI from the labour and enterprise of those of us who make a living out of supposedly non-grunt jobs. I do mainly enjoy my work but would rather spend my time watching cricket, drinking wine and travelling, but I guess I’ll put those plans on hold while I continue to work 70+ hours a week to provide a non-crap, secure living for those who want to lounge around all day watching day time television. Given that a doctor has estimated my life expectancy at around 72 due to my chronic lung condition, I might just get a couple of years retirement after I’ve provided some with a lifetime of retirment. But I’m a glass half full sort of guy so I’ll see that as a GOOD thing. Frances Coppola May 13, 2013 at 10:23 pm DBC Reed 1) If there are people who are only capable of doing grunt jobs that could and should be automated, then we should be educating them better. So yes, I do think people should be able to opt out of doing “grunt” jobs. Then they can spend their time more productively doing something that improves their personal skill set. Or not, if they choose – but I’m of the opinion that most people, if relieved of the necessity to slog away for hours doing something utterly dull just to earn a crust, would find something much more useful and productive to do. You speak as if personal fulfilment is something only the privileged few ever aspire to, but that’s not what Maslow said. 2) If you are working 70+ hours a week, you have no life and you would much rather be doing something else then your job is a “grunt” job. I never said that “grunt” jobs are low-skill, just that they are unpleasant and people don’t want to do them. Get a life and don’t moan about people who choose to have a life instead of sacrificing themselves on the altar of the work ethic. 3) “Neo-Luddite” of course is the idea that there is only one sort of “work” and if people choose not do do it they aren’t capable of finding or inventing some other form of socially useful and productive activity. Which is, of course, bollocks – just like old Luddism. DocBud May 14, 2013 at 4:46 am I’m quite happy with my life, thanks for caring, Frances. I typically take 6-7 weeks leave a year and don’t have a problem working hard in between. My goal is to be a fully self-funded retiree by the time I’m 60 as long as the constant refrain that the rich should pay more doesn’t interfere. People can choose to have a life, what they should not be able to do is choose that others fund that life if they are able to earn a living themselves. If people have not taken advantage of the education opportunities broadly available to them so that all that is available for them to earn that living is a grunt job then so be it. I don’t think your definition of Neo-Luddism is self-evident, I’m pretty sure that it will still be related to anti-technology. If people provide a socially useful or productive activity then someone will pay them for it. What is not acceptable is for individuals to declare that they are doing something socially useful or productive and therefore taxpayers must pay them for it, i.e. people should not be able to put their own value on their contribution to society. ikpeba May 18, 2013 at 10:31 am Fund basic income out of ground rents. Done. Leave a Reply Cancel replyYour email address will not be published. Required fields are marked *Comment Name * Email * Website Save my name, email, and website in this browser for the next time I comment.