How to make basic-income society work?

Question

I am a big fan of of 'post-scarcity' societies, where we could, in theory not worry about basic needs such as food and shelter anymore, and instead focus on pursuit of 'greater' things that are our area of interest.

The crucial stepping stone to that is the concept of basic income - that is everyone has enough to take care of food, drink, shelter, hygiene etc. This doesn't have to be money per se - just an entitlement for those resources.

There are a few hurdles to make it work in practice. The policy that is absolutely the easiest to implement and has the most potential is simply giving people a small, fixed amount of money, regardless of whether they work or not.

There have been some attempts at this in the real world. The most recent that I know was a referendum in Switzerland. One concern was massive inbound migration. Simply put Switzerland could probably afford fixed income for all its citizens but not for the whole world.

There are actually cases of that policy working in 19th century villages in UK and another one in Canada and even more in Alaska. Do people have some ideas how to go about setting up such a system in Europe, where movement is generally unrestricted so it's hard to prevent people coming for the benefits.

Could a solution be something in-lieu of fiat money (this smells of communism too much - great in theory but too much bureaucracy, which can lead to inefficient and unfair distribution in practice) or some policy so that only the original resident get the 100% benefits and as more people come, they get less and less (Ponzi scheme)?

I'd love more examples of that already working somewhere I haven't heard of yet.

Answer 1

I think you'd need to move gently into something like this - you don't just say one day, "free money!". You introduce a minimal income, based on citizenship, residence for several years and previous payment of tax.

Every year, if the economic health of the country/city/region permits you increase the payment and make a corresponding decrease in both the minimum wage, tax free allowance and welfare payments. Eventually you have no minimum wage, almost no welfare payments and no tax free allowance.

The first paragraph and the bolded portion above is to ensure that this doesn't cripple the economy by removing too many low income workers overnight.

Employers are going to have to adapt by, especially in low income jobs, treating employees better. We're all familiar with people working awful minimum wage jobs for awful people because they have to. Now any sufficiently mistreated employee can walk.

Answer 2

The simplest way I can see to do it is to give people "Citizenship". You have a citizenship scale where everyone starts at 0 and then accumulates points through contributing to society.

Certain events would give automatic citizen points (for example born in country +1000, completing education +1000, further education +1000, each year worked and paying taxes +200, etc). Other actions (vandalism, antisocial behaviour, etc) would cause a reduction in citizen points.

At 2000 citizen points or below the basic income would be 0, at 3000 points or above it would be full. There would be a linear scale between those points.

This means that if someone is born in the country then as soon as they completes education they are already starting to be eligible. After working a few years or completing further education then they are receiving the full basic income.

Immigrants though will be discouraged because they are starting from 0, that means they need to work for 5 to 15 years (depending on education level) before they qualify for the basic income. Additionally because there is no minimum wage and citizens have their wages on top of basic income immigrants have to work and pay taxes on a low wage for several years to qualify.

This means that only those people who will work for it and deserve it can get it.

Answer 3

Richard Sennett wrote a book about this, called The Culture of the New Capitalism, which covers politics, economics, sociology and psychology, and also the problem of setting a basic-income politic without resorting to socialist solutions. Sennet's proposal however is actually proposed to solve the problem of lack of experience and knowledge accumulation that capitalist culture is creating.

Sennett sees the new capitalist culture as a culture that wastes resources and talents and favors adaptability against experience, but in doing so it destroys the human side of work and society, as it transforms the work not in a single task that should be accomplished well, but in a series of tasks to be carried out regardless of the consequences. For this new capitalism the best worker is not the best in his field, but one that can perform more tasks than others.

A proposal to give back humanity to the worker is to establish a basic income for all.

"In this way, the State, through taxes, would guarantee to everyone a minimum level of quality of life, but the Nanny-State will disappear. If you throw your money out the window, is your business. In addition, each receive the minimum income, regardless of whether or not he uses it, in this way, the test of need would disappear."

This socialist capitalism is essentially extreme liberalism, but it's same for everyone. Every citizen would be provided with a minimum income, which he can increase with his work. However it would not be desirable to live in a State that apply these policies, as every public service would be private. The basic income is based on the fact that the State no longer uses taxes to pay public services, but to give the minimum income to its citizens. Healthcare, law enforcement, firefighters, and other services of this kind would become private companies. The citizen can freely decide from which company buying the services, given that he has the money to do it, but of course those who have only the basic income will have a significantly worse quality of life of those who have a job.

Answer 4

The first thing that you need is a source of funding. For example, in Alaska, they are sharing the state's oil revenues. Obviously, that doesn't work in an area without a distinct revenue stream, and in Alaska is not enough for basic necessities. The most common proposals have funded a basic income out of general tax revenues, possibly offset by eliminating tax breaks.

For example, in the United States, there are standard deductions that are applied to taxable income. Thus, income is only taxed above those amounts. Eliminating those deductions and further reducing some welfare programs could provide an income stream to pay for a basic income.

A previous question suggested using the seigniorage from our increasing money supply to fund a monthly payment. The challenge there is that of course we currently use that money for other things. Also, it's not that stable a funding source.

In a post-scarcity society, funding should be relatively easy, as everything is plentiful and cheap. The problem there is that we aren't close to a post-scarcity society. In particular, labor is still expensive, as is the automation to replace it.

A second issue is the possibility of migration from places without a basic income to places that do have it. The Alaskan solution to this is to limit the payments to just those who were a resident for the entire previous year. I.e. someone can move to Alaska to get the payment but must live there for at least a year before getting the first payment.

A European country might want to establish systems of mutual benefit. For example, if France and Germany both have basic incomes, someone moving from France to Germany might get immediate payments. Whereas someone moving from a country without a basic income might not. Of course, that won't be a problem for the first country to pass something like this.

The third issue is getting a system like this passed. Again, this should be simple in a post-scarcity society, as funding is not a problem and you don't really need limits on who is eligible. It's more difficult if your world is similar to ours, where resource limits are real and problematic.

So the easy way to add this into a world is to make it post-scarcity. A more difficult path is to make it funded by taxes in a more current world. Will the Swiss be willing to vote for a VAT of 20-30% in exchange for a basic income? That's a pretty big increase from 8%. I suspect that that will be a bigger obstacle than a potential flood of immigrants.

Answer 5

How to get from here to a post scarcity society?

I think you should avoid government-based solutions because of the inherent inefficiency of government-scale thinking. Corporations are also out for the same reason; too much red tape. So let's try it with a lean-startup mentality.

The inventor of cold fusion invests startup funds to build an isolated town in an area with the basics, water and fertile land.

A million applications for citizen ship come in and ten thousand are chosen. Each citizen is given a single room with a bed, a desk and a lamp. Three meals a day are provided along with medical care when needed. Nothing else is free.

Now you have the basis for a post scarcity society. Nobody is going to starve or go without necessary health care. Everyone has a safe place to sleep. What happens next is up to human nature.

If you want something more than the necessities, you work for it. All the classic jobs, from farm-hand to surgeon are available; nothing non-productive, no desk-jobs, and no bureaucrats. Any job which can be automated is automated, including the tracking of each citizen's "credit" balance. Citizens earn credits by working and spend them on luxuries not provided by the base economy.

All credit motion between citizens generates taxation which allow "the state" to pay for food production, food preparation and medical care. Over time, as the internal economy grows, the cold-fusion inventor decreases her ongoing support of the society and if it continues to operate in the absence of external funding, then the experiment is a success. If everyone is satisfied with the basics and doesn't work, then no taxes are generated and the experiment fails.

Interaction with the outside world is handled through the investor's company. Credits can be exchanged for goods from the outside (with a few exceptions, no guns, bombs, etc). A heavy tarrif is applied to all such purchases with the resulting funds being reinvested into the experiment. In the beginning, the investor would fund the conversion of credits to external products, but if the experiment succeeded, eventually citizens would be selling their creations (art, literature, technology) to the outside world, creating a balancing flow of external money being converted into credits.

Notice that the base economy has no money. It is not a handout to be spend in any way the citizen wants. It is a fundamental fullfillment of the citizen's physical needs, food, water and safety. It is capitalizm with a safety net. That is the key to its success.