Friday, 13 January 2017

Killer Arguments Against Citizen's Income, Not (4)

From Business Insider UK:

The universal basic income — a universal payment to every adult, designed to support a basic living standard regardless of whether the recipient works — has never been a broadly popular idea.


But it has become subject of fascination for policy wonks...

Ad hominem. How would be describe the maniacs who came up the myriad of overlapping rules in the current welfare system? And better a 'wonk' than a total wanker.

... across the ideological spectrum because of the goals it intends to serve: decoupling subsistence from wage labour (a goal of the left), replacing complex safety-net programs that often create disincentives to work (a goal of the right)...

We have a welfare system that largely achieves (1) but the high marginal withdrawal rates are a massive disincentive (2). So a UBI set at the same level as current unemployment benefit (in the UK, at least) ticks boxes (1) and (2) and would cost no more than current welfare system and various tax breaks meant to alleviate hardship/poverty.

Job done.

... and preparing for a future in which automation reduces the demand for labour.

It is true that a lot of proponents say this, but it's a complete red herring AFAIC. Let's worry about it if and when it happens. This is the only one of the pro-UBI arguments which looks a bit shaky, so he then focuses the rest of the article on this.

On the basis of no facts or logic whatsoever, he bungs in this bit of wild exaggeration as an aside:

But after watching voters act out their rage at the establishment this year, I have become convinced that a UBI is a very bad idea that would further destabilize the global order — and that the assumptions that had policy wonks interested in the UBI in the first place are bad, too.

"Destabilise the global order"
? FFS.

One problem is that a UBI does nothing to replace the sense of reward or purpose that comes from a job. It gives you money, but it doesn't give you the sense that you got the money because you did something useful.

WTF does that have to do with anything? A UBI can't and doesn't replace lots of things, but so what? Going back to his basic principles, if we reduce the insane high marginal withdrawal rates (i.e. move towards a UBI), the unemployed are more likely to look for work, and those in work will do longer hours, that's reason (2) he mentioned at the start but then completely ignores for the rest of the article.

And so on and so forth. Finally:

Policies are available to make work more central in society and more rewarding for workers, but unlike the UBI, they have to be conditional on work.

Follow that link - 1 is a step towards UBI, 7 is a good idea in and of itself but has nothing to do with UBI or 'worker's rights' or anything, and the rest is just a long wish list of government subsidies and market interventions, all of which will be either expensive, counter-productive or unenforceable. So a load of crap dreamed up by, er, 'policy wonks'.


ThomasBHall said...

"One problem is that a UBI does nothing to replace the sense of reward or purpose that comes from a job. It gives you money, but it doesn't give you the sense that you got the money because you did something useful."

Doesn't seem to upset landlords that much though does it?

ontheotherhand said...

Nice analysis Mark. I don't like his point either about denying people a sense of reward. The current system has such a high effective marginal tax rate on people coming off benefits that they have little incentive to try. At least with Citizens Income they get to keep 100% of the first bit of salary they earn.

I would like to see the opposite related lever tackled though - a sense for all voters that they too are tax payers and should be guardian's against over spending. I think all tax should be transparent - Employer's NI is money they are trying to pay me so I want it shown on the pay slip. Buying petrol and a can of Coke should show all the tax on the receipt.

Ben Jamin' said...


Beat me to it:)

Mark Wadsworth said...

TBH, good one.

OTOH: "all tax should be transparent"

Exactly, so putting fuel duty to one side*, in-your-face taxes like income tax or LVT are the best because people know how much they are paying. Sneaky stuff like VAT and National Insurance just gets buried by the politicians.

And tobacco duty should be relabelled "NHS surcharge", that'll shut up the miserably fuckers who say that "smokers should pay extra for NHS care" or "The NHS should save money by not treating smokers". Fact is, tobacco duty raises twice as much as cost of any extra NHS care (and saves a fortune on old age pensions, allegedly).

* One of the least bad taxes we have, but it would be good to put it on petrol receipts.

Curtis said...

If a job is rewarding, it usually pays very little.

High-paying jobs give you the feeling that you are getting paid lots of money for not doing very much.