Slashdot Mirror
Finland's Universal Basic Income Called 'Useless' By Trade Union Economist (bloomberg.com)
An anonymous reader quotes Bloomberg:
Finland's basic income experiment is unworkable, uneconomical and ultimately useless. Plus, it will only encourage some people to work less. That's not the view of a hard core Thatcherite, but of the country's biggest trade union. The labor group says the results of the two-year pilot program will fail to sway its opposition to a welfare-policy idea that's gaining traction among those looking for an alternative in the post-industrial age. "We think it takes social policy in the wrong direction," said Ilkka Kaukoranta, chief economist of the Central Organization of Finnish Trade Unions, which has nearly one million members.
Since January, a group of unemployed Finns aged between 25 and 58 have been receiving a stipend of 560 euros ($600) per month. The amount isn't means-tested and is paid regardless of whether the recipient finds a job, starts a business or returns to school... Advocates say it eliminates poverty traps and redistributes income while empowering the individual and reducing paperwork... While limited in scope (it's conditional on the beneficiary having received some form of unemployment support in November 2016) and size (it's based on a randomly-selected sample of 2,000 jobless people), the Finnish trial may help answer questions like: "Does it work"? "Is it worth it"? And the most fundamental of all: "Does it incite laboriousness or laziness...?"
The trade union argues this UBI program would cost 5% of Finland's entire gross domestic product, making it "impossibly expensive."
Since January, a group of unemployed Finns aged between 25 and 58 have been receiving a stipend of 560 euros ($600) per month. The amount isn't means-tested and is paid regardless of whether the recipient finds a job, starts a business or returns to school... Advocates say it eliminates poverty traps and redistributes income while empowering the individual and reducing paperwork... While limited in scope (it's conditional on the beneficiary having received some form of unemployment support in November 2016) and size (it's based on a randomly-selected sample of 2,000 jobless people), the Finnish trial may help answer questions like: "Does it work"? "Is it worth it"? And the most fundamental of all: "Does it incite laboriousness or laziness...?"
The trade union argues this UBI program would cost 5% of Finland's entire gross domestic product, making it "impossibly expensive."
A perfect example of basic income working is the longshoremen's unions in the US. Before containerized freight and automated cargo terminals, thousands of men would stand on the stones every morning and work a back-breaking job hauling loose cargo off ships with hooks. After containerization, instantly, there was no more work for the vast majority of these people. Since most of them were completely unskilled, and not capable of retraining into any other job that paid the same or better, they could have been in danger of seing the same fate we assign to the unemployed today -- eventual destitution. However, the longshoremen's unions implemented what amounts to a tax on cargo handled through these automated terminals that goes towards paying "retired" longshoremen a basic income. This is one example, and let's just say the union has a lot of muscle behind it that helped this get passed, but it does show a way to help the unemployable -- and make no mistake, that's going to be 90+% of us sometime before I'm dead (in the next 50 years or so.)
I guess my problem with people who argue against a basic income is that they don't have a better alternative in mind. Sometime in the near future, the vast majority of low level service jobs will be automated. At the same time, the use of intelligent systems will come and cannibalize the top end of the spectrum too. Think about doctors for a second -- they're smart enough to have a regulated profession and should be fine because of that. But what if they didn't? Medical education is basically academic hazing, from the MCAT to the preclinical firehose to 100 hour weeks as an intern. Med schools select for people with photographic memories and perfect grades because that's basically the only way to survive the training as it is today. Well, thanks to Google we don't need photographic memories anymore, so the only skill left will be synthesis of all the stored knowledge. This is why IBM basically sold off their entire business and are building Watson and other AI-type systems. Soon as these algorithms get good enough, most work that requires intuition is toast. Hospitals won't have to pay doctors when they can feed test results and live observations of patients into a machine and get a diagnosis.
I think basic income is the only reasonable transition vehicle to move the world away from traditional employment. Imagine telling everyone who's about to retire that people entering the workforce now won't have to save. Or, tell people who define themselves by their work that they've all been made redundant at the same time. Or, try to divide up the accumulated property among people when money stops being critical -- who determines where the renters go, or who gets to keep the houses they own? All of these are too much stress for the economy to bear all at once and will lead to a mess. Phase in a low-employment world over time with controls, and it makes the shift easier.
Exactly. People think a lot of people will suddenly become lazy. In fact, they won't - a lot of people LIKE their current lifestyle.
Basic income provides a roof, three square meals and some safe environment. It doesn't mean you'll get a single family home, a private apartment, or even a room by yourself! The most basic of housing can be barracks style living where everything is shared except maybe a private locker for your personal stuff. The vast majority will want to pursue work, if nothing more than to have a private room or apartment with their own (non-shared) bathroom.
The problem might be a trade union that provides for people at the very bottom - if they didn't have to work for housing, then it's possible the union might lose a good chunk of its membership. Perhaps they've been fighting for people to stay in their jobs who really don't want to be in those jobs (and are thus terrible), but in it just to live, in which cease the union is more about welfare and the poor industry than really helping people out.
One important factor you've neglected to factor in is the cost of administering the current means-tested systems. You have to: ...all of which cost money as well. Give everyone a flat amount that's enough to live on and you don't need the legions of mandarins and all the associated resources (buildings, pensions, consumables, etc) administering the system.
a) have rules
b) enforce those rules
c) maintain those rules as loopholes and variables change
Boo.
With basic income you' ll need only one computer which would send checks around based on census data.
Well, collecting extra child support (particularly migrants that "loan" children) and pensions of dead people depend on messing with census data in the first place. Unemployment benefit fraud generally depends on income tax fraud, which will probably be more popular with the much higher gross tax rate of UBI. So the biggest area you could eliminate is disability fraud, but I honestly don't think we'll force someone who was in a major traffic accident at 20 to live 50+ years on UBI with no hope of improvement.
I'll tell you the future because I think I'm living it here in Norway. First of all 90% of the population now use online banking. Between 98 and 99% of the population have payment cards, 91% prefer paying with card and 81% say they prefer it even for amounts less than 50 NOK ($6). In volume 97.3% is now paid electronically. Part of this is because we have a national standard for a no-frills debit card (BankAxept) that costs merchants a few cents per transaction, it's used in 90%+ of all card transactions which translates to 2 billion times at 100k+ sites in a population of 5 million.
Of course average people don't have card terminals, so it's been either online banking or cash. But now consumer to consumer mobile paying has taking off like crazy through a service called "Vipps", essentially for registered users it takes a cell phone number (which is tied to a unique person, no anonymous phones) and turns it into a bank account. It has gone to zero from 2.2 million users in no time and is now the de facto standard for settling debts between friends and colleagues. I suspect that the 81% who always prefers cards will now live totally cashless, short of malfunctions.
Where am I going with this? Well I'm already liable if I pay above 10000 NOK ($1200) to someone in cash and they cheat on their taxes. There is talk of doing away with the requirement that shops take cash, there's talk of requiring businesses to take electronic payment and there's talk of banning cash altogether and to be honest I don't think the 19%/9%/1-2% who remain will have the market power to resist. Even if they can't kill it completely I suspect all that take out or deposit cash will come under scrutiny. Once they're done I don't think it'll be the census computer, it'll be the all-seeing IRS computer.
Live today, because you never know what tomorrow brings
Gee, why not automate that - robo cops and soldiers to the rescue! Democratic order good, anarchy bad, citizen.
I have yet to see any proponent of UBI come up with a figure for their supposed overhead, but that doesn't matter anyway: the cost of a UBI program is greater than the entire current government budget (including social programs, defense, healthcare, etc.).
The US federal budget is 3.8 trillion. There are 320 million people in the US. That works out to about $12000/person/year, which I suspect most people in the US would consider to be far too low to actually live on. And again, this is with zero spending on anything else: no defense, no healthcare, no education, no infrastructure, etc.