UBI article, MoneyLab Reader#2

PRECARITY IS THE PRESENT. UBI IS THE FUTURE - IF WE WANT A
FUTURE.

By Patrice Riemens


EXECUTIVE SUMMARY:

UBI, for Universal, unconditional Basic Income, is the talk of
town when it comes to the economic future of the majority of
people in general, and of the 'labour market' in particular.
Amazingly, its coming is often taken for granted, but opinions on
its format and modalities are so fiercely debated as to result in
confusion about what UBI (should) represent(s). This essay
attempts to trash out common opposing viewpoints and propose a
simple resolution to reach consensus in the matter.



NB: Precarity is defined here as a state of crippling uncertainty
about one's future, being it economic or social - or both.

If Precarity is the problem then UBI is the answer - but not all
of the answer.

The increasingly precarious life conditions of an increasingly large 
number of people, already a -large- majority in the Global South, and 
fast becoming one in the Global North, is the most urgent social, 
economic, and political problem of the moment, and poverty as well as 
inequality are both its result and its most visible symptoms at the same 
time. This translates not only in want, homelessness, ill health, mental 
and physical stress, and many other hardships hitting a substantial, and 
ever growing number of people, but also in an even more widespread long 
term economic uncertainty and vulnerability. At the same time it affects 
negatively the well-being of society at large, making it 'meaner and 
leaner', less benevolent and solidary. And last but not least: it hurts 
the economy in the end, and in no small measure. Precarity by now 
affects the population at large, directly or indirectly. It evidently 
affects the under-privileged, young and old, but also hurts large 
swathes of the avowedly better-of in a more insidious way.  Middle class 
people live more and more on the edge and are in constant fear of 
becoming victims of a personal economic melt-down and social status 
downgrade. Their offsprings,  highly educated, this often at the cost of 
huge financial sacrifices, are confronted by a labour market where 
steady jobs openings in their field are vanishing.  They see no end to 
their anxiety regarding a future that appears devoid of any prospect of 
building up a better life - or even as good a life as their parents had 
enjoyed.

The provision to all of a universal, unconditional income - and both 
terms must be stressed, _together_ , to call it UBI,  is the sole 
reasonable and realistic answer to this state of affairs. Yet, one 
should realise that, if ever, and properly, implemented, UBI will in no 
way resolve the many social and economic problems facing society all at 
once: pockets of poverty will remain, and inequality will decrease, but 
surely not disappear. And far more importantly, humanity still will have 
to address a yet unprecedented convergence of crises, foremost 
environmental, more resolutely and forcefully than ever. But the odds 
for such an endeavour to succeed will surely be vastly enhanced with UBI 
in place than will be the case in its absence.


ON THE SHIFTING NATURE, AND VALUATION, OF 'WORK', AND ITS CONSEQUENCES.

A largely shared premise in discussing UBI is that work as we know it, 
that is regular, secure, long term salaried employment  will largely 
disappear 'thanks' to robots and algorithms. Smart (or at least 
inventive) observers of current trends talk of a major disruption as 
they predict that artificial intelligence in all kinds of hues will not 
only destroy 'low-skills', repetitive work (e.g. cleaning), but also 
those occupations seen as requiring sophisticated competences (e.g 
accounting), leaving only a small minority tasks, the most creative and 
innovative ones, for humans. Reasonable as this assumption would appear, 
it is not totally warranted. It depends on the evolution of what 
Marxists call the 'social relations of production. Under specific, 
unwelcome socio-political dispensations, large-scale automation could 
just as well result in a plethora of 'coolie labour', provided its costs 
are low enough. However, we can be pretty certain about a wholesale 
disappearance of work-as-we-know it, something already experienced by 
the younger generations.

This scenario will obtain wether we believe that outright job 
destruction will take place, or rather that robotics and software 
applications will 'merely' bring about job displacement at a large 
scale. This is also the consequence of another, unfortunate development. 
The (dawning) recognition that a lot of essential work, principally, but 
not only, 'care', is still not waged, yet tends to become so as 
traditional community and household bonds dissolve. But such newly waged 
work is not translated into secure employment at a fair rate of pay, but 
into a variety of flexible and exploitative contractual or informal 
arrangements. This has in its turn spawned the notion that _all_ work 
should be viewed and remunerated in this way. Business and its 
right-wing advocates have demanding this for a long time, and they 
succeed more and more in imposing this 'new normal' as template for 
employment in general, transferring previously salaried work into 
unpredictable  hirings without guarantees and rights, and ever lower 
remunerations, ever worsening working conditions, ever diminishing 
benefits.

Society, as it moves away from the "abusive, historic, identification of 
work with salaried work"(-Carlo Vercellone), appears indeed to do so in 
a highly perverse manner, jettisoning salary instead of work. UBI, 
properly understood and implemented should move the goal posts back 
where they belong: fostering security of income,  entirely independent 
of work, wether waged or not..

The ongoing disappearance of salaried work has engendered in even more 
perverse belief, widely shared in libertarian circles, and within 
neo-liberal thinking in general: that traditional, collective work has 
no merit at all, and should be spurned. Merit (and value) should solely 
accrue to individual entrepreneurship, the labour that underwrites it 
should ruthlessly be flexibilized for profitability
Labour, like all other 'factors of production', is deemed carry a zero 
base price, meaning that every increment ought to be viewed as a cost - 
to be pruned as much as possible.

The withering away of a stable, reliable link between work and a steady, 
secure wage has by now been well theorised. 'Gig economy' and 
'Uberization' typify economic interaction and relationships praised by 
libertarian elite, but precious few people outside it, and least of all 
those who are forced by circumstances to engage in them.  One can go one 
step further: where work is remunerated it is not the real work that is 
being paid for, but its outcome, at an often much lower rate than the 
actual work which made it possible. To illustrate the point, I will take 
the example of  the 'intermittents du spectacle' in France (portrayed, 
a.o. by Berbard Stiegler) The 'intermittents' are people working - very 
hard - during the cultural season, and hence only part of the year, as 
handy men in the technical side of cultural events and productions. 
Theirs is a condition of part-time employment (hence 'intermittent'),  
but of _full-time work_, as they spend the cultural season's 'slack 
time' (roughly 7-8  months out of 12) in quasi-permanent 
(self-)education and training, honing the skills they need to perform 
the constantly evolving array of tasks assigned to them during the 
summer's events. Yet the later work is perceived as merely technical, 
routine-like, and paid accordingly. The real work finding place in the 
non-waged 'slack' times is not waged, while the waged job, in season, 
only consists in putting the outcomes of this work into practice – at 
devalued rates. Or, to put it differently, they are paid, part of the 
year, at low-skilled workers' wages for their efforts at gaining and 
maintaining a high-skilled competence, the time spend on which is only - 
and then only for the moment - retributed in the form of unemployment 
benefit.  Needless to add that this is itself under vociferous attack by 
employers, since the 'intermittents' do not perform visible, and hence 
quantifiable work during that time.

This pattern, which arose in the realm of 'cultural production', is now 
fast becoming the 'new normal' meted out to more and more professions. 
That it took its roots in the traditionally underfunded and looked down 
on spheres of the arts and culture is not an unfortunate coincidence. On 
the contrary it reverberates the increasingly 'dematerialised' quality 
of work in many sectors of the economy (think of 'services', as opposed 
to 'industrial production'), where erratic relationships between work 
and pay are more easy to implement.  This is why teachers with a short 
term and part time contracts are no longer paid for the time they spend 
on preparing lessons and refresh courses, just like cleaners are 
grounded home with a zero hour contract, waiting for the elusive phone 
call.

Thus all forms of work tend to be downgraded in monetary terms and 
security of employment while working conditions show the (un)surprising 
tendency to go South almost faster even than the pay. This follows from 
the deleterious economic discourse described above, which should be 
understood as a profoundly ideological statement. Where only 
entrepreneurship is valued, 'ordinary'  work, to start with the human 
being performing it,  is besides a contemptible inconvenience, a 
maximally compressible cost factor.  No wonder this attitude often goes 
together with wet dreams about full automation, where illusions of zero 
labor costs are only  outmatched by delusions about the direct and 
indirect costs of 'hiring' robots.

This is further fuelled by widely adopted and particularly pernicious 
algorithm-based management tools,  appropriately dubbed 'weapons of math 
destruction' by Cathy O'Neil in her same-named book.  Make no mistake: 
such ideas about how to manage the corporate economy are not merely 
business as usual,  they are also detrimental to a sound and sustainable 
business on the long term. Yet there again: "it's not a bug, it's a 
feature". Since the effects of short-termism are perfectly well known, 
it simply comes down to lining one's pockets at the helm. Call it class 
war - as in Warren Buffett's famous "and this time, my class is 
winning".

UBI 'disrupts' the commonly held belief that earning money through work 
is essential even for bare survival, something society apparently 
inherited from next to three milleniums of judeo-christian tradition 
("in the sweat of thy brows thou shall eat bread ...").  UBI, by 
providing the permanent and unconditional guarantee of an acceptable 
standard of living to all, prevents the foreseeable race to the bottom 
in terms of wages, working conditions, and security of income for the 
majority. It enables the 99% to invoke and enforce one of the most 
forceful effective rights: the power to say no. Conversely, in the 
absence of UBI, the ever more scarce remunerated slots of the future 
global workplace are likely to be offered under increasingly abusive 
conditions, will carry next to no security, and will be paid a pittance. 
Society at large will revert to something dishearteningly close to a 
Hobbesian state of life: solitary, poor, nasty, brutish, and short.  
Pace  the regretted (hardly) Baroness Thatcher of Kesteven ("There is no 
such thing as society"), we may hope that such a scenario would be 
unpalatable even to the '1%' - once they take stock of its consequences 
-something, alas, by no way certain). And therefore we may conclude that 
UBI is both necessary and unavoidable.

Yet, pointing to the rapid expansion of underpaid, or even unpaid work 
as the upcoming and threatening 'new normal' is a necessary, but not 
sufficient an argument to advocate UBI. One needs  also  to look at its 
in no way fortuitous corollary: the simultaneous explosion of either 
not-work related remunerations (a.k.a. rent incomes), and of excessive, 
not to say positively obscene emoluments, never mind fringe benefits, 
dished out for very specific types of 'work' such as in the financial 
world. A few more sectors also  come to mind, hi-profile law practice 
among others.  One may even take a look at the entertainment/ gaming 
industries surfing on the 'attention economy', where employment, when 
not as outrageously remunerated as in banking and 'fintech', goes with a 
mouthwatering amount of perks and pampering: holding a job at FaceBook, 
Google, or with some gaming companies for sure gives a fresh lease of 
life to the concept of 'workers aristocracy'.

Technology-driven as these developments appear to be, it is 
financialisation which is key to understand them, since it is modern 
finance that literally bankrolls them. But there too a purely 
theoretical perspective is not enough. The quantitative fallout of 
financialisation is even more germane to  a call for UBI. This because 
financialisation 'sucks'  such a humungous amount of resources out of 
'the system' - not so much in purely monetary terms (nowadays balances 
are largely virtual, and would next to evaporate if realised) - but in 
terms of their coercive, deleterious influence on the 'real economy'. 
Its most arresting feature has been the generalised depreciation in real 
value of 'ordinary' work paired with an hard to fathom appreciation in 
the value of propertied assets (hint: look at the evolution of house 
prices). This is one of the root causes of inequality, and of the 
precarity following in its wake.

A crucial, if not readily apparent, abutting element of financialisation 
and the colossal political lobbying that went with it has been a 
progressive shift of the tax burden away from 'firms', and then 
especially large - multinational - corporations, towards 'households' 
(i.e. human beings). This happens in three interrelated ways, but again, 
this is not readily apparent : first, and  the most obvious, 
straightforwardly by way of income taxes; second, indirectly, already 
less 'visible',  through consumption taxes, as with the value added, or 
sale tax (VAT); and then finally, the most insidious of all but very 
harmful way to personal disposable incomes nonetheless: the breaking-up 
the welfare state and the privatisation of public assets and public 
services, adding up costs to the user, when not taking them out of reach 
altogether (eg: housing).   Even more perverse is the fact that together 
with dwindling rates of taxation, the corporate world has been able to 
secure an ever growing amount of direct or indirect subsidies, also 
dubbed 'corporate welfare', from the public purse, while being, in the 
same breath, largely shielded from compensating for the negative 
externalities it produces - in addition to enjoying a bail-out in the 
event it falls on hard times.

It is self-evident that radically reversing such trends in taxation and 
allocation of resources by the state would free such a humongous amount 
of resources, thst it would pay, if not in full measure, at least to a 
very substantial extent, for the implementation of UBI, thereby putting 
the most widely accepted argument against it to rest, namely that it 
cannot ever be financed.


WHAT UBI SHOULD BE - OR IT WILL NOT BE

Having looked at the material aspects of the circumstances which steer 
us towards the urgency and inevitability to implement UBI as soon as 
possible, it is also essential to look at its 'immaterial' aspects, 
which I dare say may provide an even more powerful argument for a prompt 
roll-out.


If UBI is conceived as what it rightly should be, that is not only a 
mere prop to personal incomes but also, and very importantly so,  as an 
essential building block towards a fairer social, economic, and 
political dispensation, it becomes  impossible to implement if looked at 
only from a strictly individual security (material and immaterial) point 
of view. A purely economic approach to UBI risks instantly steering it 
into an argument about 'reforming' the welfare state, replacing not only 
individual, but also collective benefits, by a nothing more than a 
transfer of money to singular persons or households. This is actually 
the hardly concealed design of the right, bent on abolishing welfare 
altogether, realising huge savings on the state budget in the process in 
order to immediately transform these in tax cuts for the rich.

It is therefore absolutely essential to forefront that UBI's paramount 
features consist not only in what the name says is in itself, namely a 
guaranteed income as condition of economic survival, but also an 
assurance of peace of mind regarding one's opportunities to be a fully 
participating member of society. What the later makes possible, and it 
cannot be stressed enough,  is freedom, both in the negative sense: 
freedom of fear, but also in positive sense: the much enhanced 
possibility to act at ones own liking. UBI is therefore the harbinger, 
but at the same time also the pre-condition to bring about a just and 
more convivial society.

Understanding and appreciating this has led to a more refined 
appellation given to what in the English-speaking realm has been called 
UBI - for Universal (& unconditional) Basic Income. In French for 
instance, the concept of 'revenu de base' (basic income),  is being 
superseded by the more advanced 'dividende de citoyenneté' (citizenship 
dividend), where the emphasis lies both in the 'natural' right to be 
granted a living income, and that this right is inherent to the 
condition of being citizen of a given (national) community. This of 
course, narrowly relates with the republican ethos, which, it should be 
noted, is not automatically incorporated in the principle of democracy.  
But this may be a bit to complicated point to further discuss here.

Reverting to the originating principle leading to the argument for UBI, 
which remains important for a correct interpretation and implementation 
of it, we can also look at it as the rightful retribution for what one 
does for society, merely by virtue of one's existence, that is, simply, 
by being there.  That may seem abstruse at first sight, but it is no way 
different from the rights granted to any human person on the 
constitutional level. It only extends such right in the material sphere, 
which in fact are already enshrined in most constitutions where it is 
the first and final duty of society to ensure the well-being of each of 
its members.

So we can conclude that UBI should be and cannot be anything else than a 
contributory benefit,  representing a universal and unconditional right 
to the material means of a decent life, _and _ presenting an 
all-inclusive opportunity to participate actively and fully in societal 
life. we understand by this the freedom to engage in activities which 
are both beneficial to the community and gratifying to the person 
performing them, something sorely lacking under the present economic and 
political dispensation. if UBI were to come about, there is no doubt 
that indeed a different type of human society would slowly emerge, which 
would take up seriously, at the very last, the build up of a what has 
been called 'green capitalism' . One may of course hope, campaign and 
militate for more - a vast and genuine transformation of economy and 
society towards the sustainable future we all call for, but which seems 
dangerously of the cards at the present juncture. So dangerously indeed 
that one could state that the options are simply down to two: UBI or 
social meltdown.


We can now turn to a few practical questions which have bedevilled, 
wrongly so in my opinion, the debate about UBI.


On the 3 practical questions commonly voiced about - and usually 
against) - UBI.

1. CAN UBI BE FINANCED AT ALL?

The answer is an unqualified yes - the money is there.

That is, of course, given the existence of a political will strong 
enough to take the necessary economic measures to make it happen, 
specifically in the sphere of taxation. This requires a relatively easy 
(if politically daunting) realignment of the share of the fiscal burden 
between categories of contributors, simply put, between households and 
firms. It would also require a substantial 'de-financialisation' of the 
economy on a somewhat longer term, that is a near-reversion of the  in 
the ratio between 'immaterial' (aka 'virtual') and 'material (aka 
'real') money in society's fiduciary balances (this being not the place 
to engage in the controversies surrounding the terms 'virtual' vs 'real' 
economy, both terms being misnomers anyway. Suffice to point to the fact 
that the amounts rolling over in the global financial sphere exceed the 
sum total of actual on the ground economic activities by a factor 10 - 
or higher.)

There is in any case no doubt that once introduced,  UBI may well 
accelerate this shift even further since, at present,  the financial 
behemoth largely feeds on debt, a lot of which consists of consumptive 
credit.

Taxation-wise, an an even longer run, and certainly not than after 
careful a study of its consequences on the distribution of wealth and 
incomes and more specifically on its impact on the incomes of the poorer 
parts of the population, one could think of fully streamlining taxation 
into one single measure: a tax on _all_ monetary and and financial 
transaction, that is on all _formal_ movements of money [1].


2. WILL THE INTRODUCTION OF UBI DEPRESS WORK-RELATED INCOMES,
WAGES AND OTHER REMUNERATIONS?

Here the answer is a slightly more qualified no, as very much hinges on 
the modalities of UBI as implemented

However, a genuine UBI sets the floor of individual income at a level 
that secures all of a person's basic needs. Obviously the problem here 
lies with the definition of basic needs. The higher the standard is set, 
the more difficult it becomes to fund it. But conversely too low a 
standard would obliterate the very opportunities UBI is intended to 
provide. And on the marketplace of labor the most important one for an 
job seeker is the effective right to say 'No'.  This is avowedly the 
trickiest issue regarding the implementation of a sustainable and 
effective UBI policy. Yet in any case, having to pay good money for work 
which by its nature cannot fall within the voluntary sphere and for 
which there still is a demand somehow will remain a fact of life in the 
commercial sphere, and so business will have to propose appropriate 
earnings if they wish to recruit motivated collaborators.

Therefore, once a reasonable standard of UBI is established, there is 
little reason to believe that 'the going rate for labor' would fall 
substantially below than the the currently prevailing one. Wages might 
even turn out to increase, since business will have to compete, 
materially and immaterially, with the non-commercial, not for profit 
sector of the economy opening up  many rewarding activities in the 
'commons' sphere given the existence of UBI.

This is the also the principal argument to reject in the strongest 
possible term any declination of UBI implemented  along lines proposed 
by some right-wing/ libertarian opinion leaders: slashing or abolishing 
outright social/public services services as a quid pro quo for its 
introduction, this under the false pretense of budget neutrality. Such a 
fraudulent neo-liberal/ libertarian interpretation of UBI would not only 
keep the scourge of precarity going but indeed quickly transform UBI 
into, not a minimum, but a maximum income for the '99%'.


3. WHAT OF THE PLACE OF WELFARE (AS WE KNOW IT) AFTER UBI?

The answer is that it should largely stay in place - if thoroughly 
reformed.

Neo-liberal / libertarian economic doctrine, having - reluctantly - 
accepted the inevitability of UBI demands it to be traded against a  
massive reduction, or even the total abolition of welfare as we know it. 
Yet, cuts in social benefits and subsidies on public service provisions 
like housing, health or education, translates in immediate additional 
expenditures for recipients of  UBI, nullifying in one go all the 
advances it represents.  Slashing subsidies and making public services 
much more expensive - even if only with the intention to cover their 
costs, never mind the idea of privatizing them - it would defeat its 
other crucial purpose, even if that is seldom so openly stated: buying 
social peace in economically unsettled times for the majority.

Hence, maintaining a welfare state - minus direct monetary transfers - 
that is consistent with providing access of essential services to all is 
not only a corollary condition, it is a sine qua non of an authentic 
UBI.


In the end, both UBI and maintaining such subsidies, and provision of 
public services at a budget neutral level - for UBI recipients that is - 
  will have to be funded by mobilising existing resources in society - 
meaning an increase in taxation. Many economists have done the math 
already and concluded that the overall level of taxation would  indeed 
rise after UBI, but far less than argued by detractors, and shifts in 
the modalities of taxation, as already alluded to, will enhance the 
income position of the poorer households, and would make little or no 
difference to the average taxpayer, though it will certainly hit the 
wealthier classes harder than is the case at present - after a long run 
of tax _decrease_ for these categories.


-----------------

We may look now at some other, important issues pertaining to, or 
impairing, the debate around UBI.


ON THE POLITICAL OUTCOMES AND CONSEQUENCES OF UBI.

A growing perception of economic and  other forms of insecurity among an 
increasing part of the population, well illustrated by the popularity of 
the precarity moniker,  has made a large number of people disgruntled 
with the existing political  dispensation. which it holds responsible 
for it its misfortunes.

This has fostered, in the Global North, the appearance, and then stark 
expansion of extreme political movements, especially at the right side 
of the spectrum. These are threatening democracy, the rule of law, the 
arts and culture, and hence human rights and fundamental liberties in 
general And this the more so since unlike what happens on the political 
left of the spectrum, their arguments are not so slowly, and not so  
stealthily, being adopted by established (center-)right parties.

One should never forget that the rise of European fascisms in the 1930s. 
However uncomfortable the fact, these were truly popular movements, and 
their rise was was greatly, when not entirely, helped by the previous 
powers of the day being unable or unwilling to stem the general 
impoverishment caused by capitalism's crisis and the ensuing Great 
Depression. Portentous signals are already here to compel us to head 
that lesson. It should be self-evident by now that an authentic UBI is 
the sole alternative to social and political melt-down and an 
out-and-out disaster befalling us all over again. Decision makers 
failing to take the cues, be it by design or by default, can be sure to  
pay rather sooner than later the price of their deplorable 
shortsightedness.


THE RISK OF A 'PULL-EFFECT' OF UBI ON IMMIGRATION

This issue is indeed an elephant in the room - there are a few more - 
in discussing likely outcomes of UBI. The opinion that granting UBI to 
everyone in a given territory would attract masses of (poor) outsiders 
and make the system unsustainable is widely shared in some circles, and 
is just as widely being suppressed among their opponents. Both are 
unfortunate and prevent a cool-headed reasoning.

The likelihood of a pull effect is real. But it should be seen in 
context, present and future. Granting unrestricted UBI to immigrants 
delivers a different outcome than in the case of the more established 
population because immigrants wish in general to earn money not only for 
themselves, but also for their kins at home. They are thus  resolute 
savers and remitters, and this practice undermines an unstated but not 
unimportant purpose of UBI: pushing local demand for goods and services.

There are several possible answers to this situation, short of 
preventing immigration, a policy that is as impractical as it insults 
basic morality.

To start so my be not to start with immediately, the imbalances caused 
within society at large caused by the excessive marketisation and 
financialisation should be addressed. With regard to UBI, part of it 
could be 'demonitized' by making a basket of social goods and public 
services available for free, e.g. health, and education, or at very 
nominal cost, e.g. housing, utilities, transport. This to retain part of 
UBI in the economy that funds it. Formalising and expanding the use of 
local currencies, possibly ones carrying a demurrage charge (cf Silvio 
Gesell)  is another option. Making UBI partly payable on an electronic 
instruments (e.g. chipcards) with a limited geographical validity is 
feasible,  but goes with a contraction of a recipient's truly freely 
disposable income. Even non-fiat crypto-currencies have popped up in 
some UBI blueprints, but then, among other things, stark issues of 
general usability arise.

Finally one could trade an initial UBI disqualification of immigrants 
against allowing them free movement in and out of a particular UBI 
allocating jurisdiction. Immigrants could then gradually gain access to 
UBI, say after a number of years as is the case with naturalisations. 
This would also alleviate fears of an 'alien tsunami'.


'LEGIONS OF COUCH POTATOES' AS A CONSEQUENCE OF UBI

Morally (turbo-)charged  opponents of UBI often allege that, among many 
other evils, UBI would in effect amount to a premium on laziness and 
lull its beneficiaries into a terminal coma of gawking in front of 
screens  24/7/365. Some corroboration  to this might come from surveys 
in the U.S. among recipients of social benefits, especially MedicAid. 
They also point out the addictive effects of more or less permanent 
'social' media usage within our thoroughly fragmented and individualised 
society, especially among those with limited schooling and skills

This, however,  appears to be an exaggerated scenario in view since one 
can expect UBI, once implemented, to trigger quite soon an at least 
partial reformation of society towards more voluntary work openings, 
more conviviality and more co-operative and relaxed lifestyles in 
general.  This would provide both for the opportunity and the drive to 
participate in 'the commons' in one way or the other.  There for sure 
will be a  minority of people preferring to 'enjoy' what others may see 
as totally empty idleness, but  hat will be a very tolerably small one 
(one recipient out of 10? One out of 8?). There is no reason to see this 
as a valid reason to ditch UBI.


TAXATION AND THE 'POVERTY TRAP'

We have briefly discussed that, given an reform in the current system of 
taxation, UBI is well affordable, even if it would constitute a major 
component of public expenditures. But this is no way unworkable, or even 
unprecedented. The French social security system, for instance, swallows 
up 30% of current GDP  - 100% when kicked off just after WWII! - and yet 
nobody seriously suggests abolishing it.

Some tricky issues will remain unresolved however, and might derail UBI 
implementation unless carefully attended to:

(i) Direct (income) taxation after UBI:

Some have suggested income-taxing from the very first unit earned after 
and above UBI, preferably in conjunction with a (low) flat tax - the 
evergreen dream of the political right. Both suggestions should be 
resisted, in the same way as are  any suggestion to curtail social and 
public services, and for the same reason: they intolerably reduce 
recipients'  actual disposable income, at the same time as they reduce 
the total amount of tax leviable.

There should be a tax credit/ rescission extending quite some way after 
UBI (my hunch is: up to the amount of another UBI) to offer maximum 
incentive to participate in one way or another to economic life. After 
that, income tax rate should be not be flat but on the contrary 
progressive, and steeply so, both to indeed fund UBI, but also to 
decrease income inequality.  Concurrently, punitive taxation should 
apply to (very) high incomes, so as to achieve a further reduction in 
(material) inequality. This, by the way, would be merely a reversal to 
the situation prevailing for two or three decades after WWII in the 
Global North, where is some countries the highest marginal rate of tax 
was surprisingly close to 100% (as in, surprise, the USA)

(ii) Indirect taxation and UBI:

The idea of substantially funding UBI, and state expenditures in 
general, by way of steep levies on consumption, more particularly sales 
and value added taxes (VAT), proves invidiously popular, especially to 
the right of the political spectrum. This only confirms what is 
economically acknowledged, and politically ignored, deliberately so, 
that indirect taxation is highly regressive and favours the wealthier 
segments of society - in fact the tweaking the VAT upwards function as a 
proxy for the unrealizable  flat tax on incomes - and should be rejected 
on the same grounds.  Levies on consumption  affect people with low 
incomes much more than they burden the rich, whose larger outlays in 
investments, savings etc. are less or not at all taxed.  High levels of 
indirect taxation hence inevitably cancel out some the desired income 
effects of UBI,  even though high demerit taxes on environmentally or 
otherwise socialy objectionable elements of consumption should be 
admissible.

(iii) (Social) benefits after UBI, and the scourge of the
'poverty trap':

We have already argued that a curtailment of social benefits after UBI 
is a total non-goer. However, maintaining them as they are administered 
in many jurisdictions is a dead end just as well. Under the current 
dispensation, benefits recipients gradually are gradually weaned from 
them as their income increase. Unfortunately this 'decrement by 
increment' policy results in practice in a tax on the additional income 
approaching 100% - and sometimes even exceeding it - something that 
would of course be utterly unacceptable if it would hit wealthier 
categories of citizens.  This state of affairs now constitutes a potent 
disincentive to accept any form of work when not very highly paid,  and 
that would not change under a UBI regime.  Hence, phasing out of income 
supporting subsidies, while acceptable in itself, should be done very 
gradually just like slabs in a  progressive income tax, and so not 
result in a unfair loss of incremental income.


It should be clear by now that UBI demands a  new approach to taxation 
and all its income-related corollaries affecting households. But it 
should be equally clear that the path should be treaded very carefully 
indeed, lest 'perverse (negative) effects'  start popping up all over 
the place.  A pragmatic, if politically tricky approach would simply be 
shifting away the main burden of taxation from the personal 
('households') to the  corporate ('firms'), as mentioned earlier. A more 
radical, but preferable approach in my view, would be to do away with 
the whole concept of taxation as we know it  altogether and move towards 
a single, universal levy on the movement of _scriptural_ money, the 
money of the rich and the corporates, while leaving cash, and/or its 
(yet to be developed), electronic stand-ins of the hook. This is without 
doubt heady stuff, which clearly needs 'further research' . But it might 
well be our only way out for a better society in the long run.


THE 'PROBLEM' OF FUNDING UBI

The absurdly simple - if difficult to comprehend in a politically 
productive manner -  answer to any 'TINA'-styled objection to the effect 
that UBI is a dead duck within our current economic dispensation, itself 
to be seen as an unalterable given (by God? by Nature?). It merely lies 
in an elementary modification of the choice being made by a government 
when presented with the 'trilemma' any modern national governance faces, 
which is to choose two _and no more than two_ out of three options 
which, if taken together, are incompatible:

These options are:

(i) maintaining/increasing the standards of living of the
national population as a whole;

(ii) allowing for the free movement of capital between unequally
governed jurisdictions with regard to taxes, labor laws, etc.;
and

(iii) stabilizing monetary values, i.e. the exchange rate of the
national units of account against those of other countries.

Under transnational capitalism, fired by a neo-liberal, and now 
increasingly libertarian ideology, this choice has systematically be 
done in favour of the last two elements, and at the detriment of the 
first, never mind that it embodies the vast majority of the people.

Undoing this choice is a primal condition, yet also an inescapable 
outcome of introducing UBI at a large scale. It will also have the 
positive effect of cutting deeply into the rent incomes of the 1%.

Basic or minimum income, disposable income, and UBI: welcome to 
obfuscation central.

When all is said and done, and the principle of UBI is accepted, rest 
the question of - to what amount?  And the bar brawl can resume in all 
its fieriness.

Under our current dispensation the common attribute of all lower
incomes, indifferent whether they are waged, otherwise earned, or
obtained through social benefits, the unmistakable trend is an
ever diminishing proportion of the freely disposable household
income that is left after all necessary, incompressible expenses
(e.g. rent, insurances, taxes, etc.) have been paid. This is even
the case when the income obtained is itself not declining or even
moderately increased. This is the first thing that need to be
considered, and reverted, before and when implementing UBI.
Therefore a healthy margin of freely disposable income must be
ensured for UBI recipients, because it forms a basic requirement
to alleviate the feeling of precarity and encourage initiatives.

The question of at which amount UBI should be set is a vexed one.
Here opinions vary greatly, and aside from real or perceived
funding issues this is caused by confusing UBI with a minimum or
'basic' income, which it is not and should not be. A better point
of departure would be a living income (as in 'living wage'
demanded by labour unions) ensuring not a living on the edge of
poverty but a life with dignity. That needs not to require an
extravagant sum, but is surely something significantly above the
absolute poverty line. Amounts of CHF 2550 or €1200 a month for a
single person in Switzerland and the Netherlands respectively
have been suggested, and appear realistic to ensure a decent, if
sober, living standard. Conversely, any amount dished out to
citizens (ca.k.a.'helicopter money') is welcome and will some way
go towards fulfilling the purpose of UBI. But it should not be
called UBI.

Finally it is unavoidable to stress and repeat that UBI should be
unconditionally universal. Ridiculing the prospect of
zillionaires receiving UBI is damnably disingenuous since
progressive income tax - punitive even - will recoup those monies
- and then some. Playing ball with unconditional universality is
a blue print for the kind of red tape and meddlesomeness that has
disqualified for good the 'nanny state' welfare.


As a final note:

UBI'S INCIDENCE ON PRECARITY / POVERTY / INEQUALITY

Introducing UBI at a fair level of allowance will largely if not
entirely eradicate precarity understood as economic uncertainty
and/ or vulnerability. After receiving UBI it will remain to each
individual's responsibility to deploy the necessary initiatives
to move up if so wished, on the ladder of material achievement.

Poverty, especially relative poverty, will be substantially
lessened, although not totally obliterated. At the bottom tier of
the 'social order', UBI payments will ensure a decent, if sober,
living standard. At the top of the income and wealth pyramid,
steeply progressive taxes should reduce incentives to demand and
obtain unbecoming levels of remuneration. Furthermore, outlandish
displays of wealth and luxury, which are all too common in our
times, will carry, if not moral rejection, in any case a hefty
tariff. Outlandish levels of conspicuous consumption greatly
destabilize the social convenant , and should be restrained.

Inequality, to conclude, will be partially tackled, but certainly
not overturned with the introduction of UBI. One should dare to
argue that its elimination does not, and should not, rank very
high in the aims of UBI. Social engineering has limits which
should be acknowledged and respected, and experience shows that
inequality is not much resented if kept within reasonable bonds.
Meanwhile a general 'softening' of society one may expect to
result from implementing UBI should go a long way to 'flatten'
the distribution of what former Dutch PM Joop den Uyl famously,
if problematically, described as the hallowed trinity of
'knowledge, power, and income'.


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GENERAL REFERENCES

Because this text has neither the pretense nor the purpose to be
a scientific article or a Wikipedia entry, I decline to provide
the usual string of sources and references, which are in most
cases not very helpful in my view anyway. Yet I do advise readers
to pursue their own enquiries, making use of the truly amazing
amount of information on the subject that is available on the
Internet, and which can be easily retrieved using judicious
search terms.

Yet this  doesn't preclude giving a few pointers to get started:

The ultimate resource on UBI is the BIEN site, for Basic Income
Earth Network:

http://basicincome.org/

together with the sites of its national and regional affiliate
organisations. There, readers will find more resources than they
possibly will be able to digest (I didn't even try).

The Precariat, the social category the most talked about when it
comes to UBI has it own singular store of expertise, clustered in
one individual: Guy Standing. He is basically a one-man resource
to next to everything that needs to known and said about UBI

http://www.guystanding.com/
http://www.guystanding.com/publications


Patrice Riemens
patrice@xs4all.nl