The proposers of the Swiss referendum on the basic income are claiming their 23% poll as a success. Although the actual ballot mentioned no figures, I felt the figures used in the campaign were rather high, leading to the possibility that it would look as though there was more opposition to the principle than there actually was. However, it looks as though there is a fundamental problem. My spies tell me (I have not seen this in the media) that the incentive for immigration figured largely in the opposition, and the campaign failed to answer this. A more modest figure may have helped, but what emerges starkly for me is that it may be difficult to introduce a Basic Income in one country unless it happens somewhere without a democratic mandate. But are people flocking to Utrecht. Tilburg or Groeningen yet? I have been saying it needs to be international anyway – redistribution as between nations, not just individuals (see my last week’s post).
The ‘Compass’ version of the Basic Income was launched at the House of Commons on 6th June. What is for me the prime reason for a BI, to allow contemplation of zero growth without fear of insecurity is mentioned , but as the least important reason. I wonder if this aspect has been fully assimilated, because on p.21 it suggests a BI as a remedy for slow growth due to profits going to dividends rather than wages.
One could not really assimilate the full details at the launch, but I perused it on the train home. It is obviously thorough and workmanlike, and goes into detail with 5 schemes, three partial, which maintain elements of means testing, and two ‘full’ schemes, which despite costing £43billion or £35billion, still leave some low earners worse off. These figures are less than I expected, given that Tax Credits already cost £30billion. Although the pamphlet does not make it clear why some on low incomes lose, it seems to me that this is because in the ‘full’ schemes, tax credits would be abolished. Why? When Gordon Brown introduced tax credits I saw them as a surreptitious step towards removing the poverty trap, but I realized they would seriously complicate the eventual introduction of a ‘proper’ BI. I should have thought a full scheme with the retention of some tax credits would have been feasible. Tax credits could eventually be phased out when changes in behaviour and the labour market which could be expected take place.
The ‘Compass’ scheme makes no reference to ‘Dynamic Benefits’. True, that is now almost seven years old, but those graphs (one at the top of this page) are still relevant. What was used as the basis for the Universal Credit, could still have been used as the basis of this report, though the authors could presumably have updated the data if necessary. They could have asked “What would the cost be if the massive tax-equivalent claw backs shown in those graphs were simply shared evenly, so that there was a straight horizontal line instead of the claw-back mountain shown at low incomes?”
That this launch has taken place is a huge step forward, but I have one final concern. I was able to suggest to the launch meeting that the potential for slowing the economy to sustainable levels should be its main purpose. None of the panel members saw this as important enough to comment on. Until a steady state economy is feasible as a policy option, the aims of a Basic income will be blown away by environmental problems. In 43 years, no one has yet suggested a better idea than a Basic Income to make a recession thinkable by whole populations.
Green leadership election. In my blog posts on 14th February and 6th March, I outlined concerns about how far the Green Party has drifted from its original purpose. It should now be concentrating on measures to make the Paris climate agreement a success. A trawl through the Party’s website shows little interest in the major threat facing mankind. If unopposed, can Caroline Lucas and Jonathan Bartley be relied on to change this? You have to search for a mention in their campaign literature. I was not the first to wonder whether a challenge to what is expected to be an extremely popular leadership team will help to remedy this serious loss of direction, which long pre-dates Natalie Bennett’s leadership. I shall be away next weekend, so no Sunday blog, but some time whilst nominations are still open I have in mind to publish a blog discussing the pros and cons of a leadership bid. The original proposer of this idea would have difficulty for various reasons, but I can think of eminent candidates who agree with me on the problem. If they all have cold feet, should I stand? As I say, it needs discussing.