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Finland considers basic income to reform welfare system

• jmadsen 11y ago
  I don't "know" if any of this is a good idea, but I'm glad to see it at the top of HN & elsewhere, where people can start to consider different ways of dealing with a changing world economy. We need to allow ourselves to consider new ways of thinking about work, welfare and income
  • jensen123 11y ago
    I don't know either, but I find it interesting. I guess it really needs to be tested in the real world, in order to see whether or not it will actually work.
  • gpvos 11y ago
    Things like this have been posted quite often lately (some cities in the Netherlands are also starting small-scale experiments, and a rather high basic income was proposed in Switzerland a few months ago; I think all of those were posted here). I'm all in favour of a basic income (or at least of testing whether it works), but I wouldn't actually dare post here about it in fear of creating an overload...
• lordnacho 11y ago
  The article alludes to the fact that you remove marginal disincentives to work by doing something like this. Many existing systems have some form of means test, which in practice results in very high effective tax rates. Once we decide we want to support people on low incomes, there's a question of how the best way to do that is. The Nordics especially have built up enormous bureaucracies that in themselves cost a lot to administer various handouts and benefits. It might make more sense just to cut a cheque to everyone.
  • daemin 11y ago
    I see that it could help people start their own businesses since at the worst case you'll end up back on the minimum income. So that takes one element of stress out of it and you can focus on the business more. I can see some arguments against this that would say the owner would be less hungry for success, and while that's true not every business that starts needs to be the next big thing.
    • troels 11y ago
      In practise, this is more or less the case already in the nordics. The social safety net is so wide that even if you fail spectacularly at life, you won't hit rock bottom.
      • lordnacho 11y ago
        Except if you do badly at business, you have to lose everything before they help you. If you have anything that can be turned into money, or your spouse does, you have to use that first. Another facet of the Nordic system, and not great for entrepreneurs.
  • jensen123 11y ago
    Of course, one problem with the current bureaucratic system in the Nordic countries, is that some people slip through. If for example you start a personal company, and later fail, you won't get unemployment benefits (unless your company was a corporation and you hired yourself, of course). At least, that is the case in Norway.
    • Hytosys 11y ago
      Do you know why that has occurred?
      • jensen123 11y ago
        I find your question a bit unclear, but I'll try to answer. Even in a best-case scenario where the politicians who are creating the laws/rules are well-intentioned and really are trying their best, I guess it's impossible to think of every single real world scenario. Thus, there will always be people who will fall through a complicated safety net. As for why entrepreneurs aren't always covered in Norway? I'm just speculating here, but anyway: Since WW2, Norwegian politics has been dominated by The Labor Party (Arbeiderpartiet). They usually look out for ordinary workers, which tend to have it pretty good in Norway. Others groups, such as entrepreneurs, drug (ab)users, farmers etc. aren't always treated so well.
        • Hytosys 11y ago
          Interesting. I would hope that the safety net is at least something like 90% successful, but I haven't done my studying at all. Thanks for your insight into exactly who falls through the net.
    • pmjordan 11y ago
      That's the case in many European countries with sophisticated welfare systems. In Austria, we can pay extra (I think ~1.5% of income) as self-employed to get unemployment benefits but I don't know how popular that option is in practice. Personally (as a highly employable, fairly senior software developer, so I'm unlikely to be out of a job as long as I can work) what's worse than lack of unemployment benefit is dealing with times of sickness. I suffered from Lyme disease for about 2 1/2 years until it was diagnosed properly and treated, and in addition to the reduced income due to being unable to work at times, and the extra cost of healthcare (despite the insurance it's not exactly free) in Austria, they still expect you to pre-pay taxes and pension & health insurance contributions based on your earnings 1-2 years ago. In theory you can claim some money for a few weeks if you get sick, but (a) you have to completely shut down any business activity for that time and (b) you have to be declared unable to work by a doctor. (Unlikely, considering the doctors were all telling me there was nothing wrong with me and it was "stress"…) A basic income would at least help deal with the reduced income due to sickness & extra costs due to healthcare. The pre-payment aspect is probably peculiar to Austria and apparently frequently bankrupts profitable small businesses.
  • scotty79 11y ago
    What could be great about basic income is that you can safely fire a lot of bureaucrats without harming them. Some of them might even welcome the change from being paid to do meaningless job to being paid for literally nothing.
    • bmir-alum-007 11y ago
      Purpose, or keeping busy at a minimum, is a tentpole of avoiding depression... even if it were seemingly "busywork."
      • Sammi 11y ago
        That's the thing. Meaningless busywork is making people stressed and depressed. Basic Income on the other hand would free people to pursue whatever purpose they themselves desire. You can make up your own meaningful job, cause you're already getting paid.
        • bmir-alum-007 11y ago
          That's a sweeping generalization which presumes far too much. It depends on the person. Some people enjoy monotonous factory work because it removes the burden of thinking. Other people need a manager because they don't want to, or can't, plan the next logical thing. Others need constant variety or don't like being told what to do. The other issue is that getting paid for a "meaningful job" which doesn't turn a profit is not going to scale. Millions of people suddenly wouldn't work in fast food, farm fields, industrial tanneries or meat processing plants because they're really shitty/dangerous/disgusting jobs. (But I'm sure some scary/crazy people enjoy them.) And, when people have infinite choices and opportunities, the Paradox of Choice comes in to play and people become even more dissatisfied. See also: Zillions of wealthy housewives in perpetual existential boredom (depression) filling psychology & psychiatry offices.
          • scotty79 11y ago
            I don't think that paradox of choice results in more suffering than not having the choice at all when it comes to having a job. With basic income you have a bit more choice when it comes to picking a job. You no longer have to restrict yourself to sufficiently paid ones.
  • eru 11y ago
    They have to systems to assess people's income: the tax people and the welfare people. Might as well reduce that to one system, the tax people.
  • jules 11y ago
    Does running the welfare system actually cost a lot? Last time somebody claimed that about US social security another person responded with data showing that it's less than 1% overhead.
    • PavlovsCat 11y ago
      http://thinkbynumbers.org/government-spending/corporate-welfare/corporate-welfare-statistics-vs-social-welfare-statistics/ http://thinkbynumbers.org/government-spending/corporate-welf... > The final totals are $59 billion, 3 percent of the total federal budget, for regular welfare and $92 billion, 5 percent of the total federal budget, for corporations. (from 2006)
      • maxerickson 11y ago
        Gp is talking about the costs of administrating the programs, your numbers are the total costs.
      • adventured 11y ago
        Even though that's not the admin costs in question, those numbers are drastically far off from the actual welfare system costs. In 2012, the US Govt. spent $80 billion just on the SNAP (food stamps) program alone. A total of over $100 billion went to welfare food programs.
  • jvm 11y ago
    Means testing actually increases the disincentive to work. Working usually results in greater income which can diminish the benefits. This amounts to an effective higher marginal tax rate, when benefits are removed as you earn more. It's hard to imagine a system that disincentivizes working more than means tested welfare. A few examples from SNAP can be found here [1], CBO study showing up to 80% marginal tax rates on the poor here [2]. This is precisely the insight driving basic income: by removing means testing, we can avoid perverse disincentives to work: higher income always results in higher pay. [1] http://taxfoundation.org/blog/high-implicit-marginal-tax-rates-make-life-difficult-poor http://taxfoundation.org/blog/high-implicit-marginal-tax-rat... [2] https://www.cbo.gov/publication/44621 https://www.cbo.gov/publication/44621
    • pluma 11y ago
      In Germany we have a welfare system that requires you to take on pretty much any job if you become unemployed. If you only qualify for low-income jobs this can mean you end up taking on a job that pays you below welfare and welfare actually has to bridge the gap and pay you the difference. This not only means you're working for the same money you would have if you didn't work, it also means there's pretty much no way for you to improve your income unless you can change jobs to a significantly better paid one. Even a raise or bonus wouldn't change your bottom line as the welfare is adjusted 1-to-1 for every cent you make. This is IMO the greates disincentive of our welfare system. There's no advantage to finding an actual job when you're on welfare and don't qualify for jobs that pay significantly more than welfare. It's unsurprising that some game the system by intentionally failing job interviews and doing ludicrous amounts of trainings instead of finding and getting a (low-paying) job. I don't know whether a blank check is the right solution here, but a frequently mentioned alternative for the skeptical is basically a negative income tax: for every two cents you make on top of basic income, you pay one cent (or whatever fraction -- the actual percentage is irrelevant to the idea as long as it's below 100%). This avoids the financial "dead zone" created by the 1-to-1 adjustments of the current welfare system.
      • clavalle 11y ago
        But then you have the problem of businesses catering to 'gap people' and scraping profit from those subsidized positions.
  • mpg33 11y ago
    > The Nordics especially have built up enormous bureaucracies that in themselves cost a lot to administer various handouts and benefits. It might make more sense just to cut a cheque to everyone. Not only that you could argue that it is also more efficient to have the spending decisions done by the individual and not the state.
• 1971genocide 11y ago
  I suggest we use basic income to even pay wall street ceos - and here is why. Give everyone a salary that allows them to afford food and rent. Including rich wall street bankers. This will help unsigmatize the "welfare queen" factor. Second - since we have this habit of treating humans as lab rats and need to dangle "incentives" to drive them to be productive. Create a sliding scale on top that goes from 0 to S_max. Everyone from the Walton family members to Jeff bozz gets paid S_max + food + rent and every homeless person gets paid 0 + food + rent. If the overall GDP of the country improves S_max goes up. If there is food shortages or housing shortages then S_max does down.
  • troels 11y ago
    "I suggest we use basic income to even pay wall street ceos - and here is why." It wouldn't be basic income if the wallstreet CEO's were exempt. Then it would be welfare.
  • Cthulhu_ 11y ago
    There's a different matter though; Wall Street bankers implies they live in NY, where the cost of living is enormous; the basic income as described in this and similar articles wouldn't be nearly enough to cover even half of the cheapest cost of living.
    • k-mcgrady 11y ago
      Evening taking the location out of it though if you want to live in a large house basic income won't cover it. I think as long as it provides a basic level of living for everyone (small house - enough room for you and your family, basic healthy food costs, utilities) it's good enough. Then if you want a higher standard of living (eating out, mansion, car, vacations) you have to get a job. That way we keep people who want to work working but those who want to pursue pursuits without large financial upsides can.
    • pluma 11y ago
      And you need to live in expensive places because why exactly? Because the jobs are there. And why do you need to be where the jobs are? Because you need a job. And why do you need a job? Because you need to pay for your livelihood. And why do you still worry about that when you have BI? Sure, some people still might want to do the kind of jobs you can only find in places with astronomical costs of living, but even BI can't prevent you from making unsound decisions like taking a job in an expensive place for a wage that barely pays your cost of living. What BI can do, however, is eliminate the necessity of taking on that job or moving to that expensive place. And maybe if you can't find a job in the places you can afford to live, you just start your own company and create jobs for other people who can't afford to move to those places. BI changes dynamics. I'm not saying people will stop moving to NY to work low income jobs but at least they have less incentives to do silly things like that.
• Sknowman 11y ago
  Canada tried something like this in the 70's, it worked. http://www.cbc.ca/news/canada/manitoba/1970s-manitoba-poverty-experiment-called-a-success-1.868562 http://www.cbc.ca/news/canada/manitoba/1970s-manitoba-povert... http://motherboard.vice.com/read/the-mincome-experiment-dauphin http://motherboard.vice.com/read/the-mincome-experiment-daup...
  • deleted 11y ago
    [deleted]
• alexivanovs 11y ago
  Typical Hacker News comment section on something innovative and something that takes the next step in global economy; "I don't know.", "hmm, looks like a bad idea.", "yeah, it doesn't affect me so I guess it's pretty bad."
• kfk 11y ago
  The problem in those countries is taxes and social contributions. You need to make 10 in order to bring home 5, that kills work, completely. Now the basic income, so basically we want the State to manage even more of the economy. If past experience would prove this effective, then OK, but it just proves the opposite! Let me do some back of the envelope calculations for you. In Europe we pay around 40% of income tax. On top we pay at least another 8% for pension, which we will never see, and another 8-10% for health insurance, which is not great at all. On top of that, companies have another 30-40% of cost, _on top_ of the bruto salary of an employee in taxes and similar to pay to the state. Bottom line: more than half of your cost to the company goes to the government. It's just incredibly bad. If you have a 10% unemployment the most effective way to help people is to bring that down to, say, a 3%. That will help most definitely. But for that to happen you need to bring down the cost of labor, which is just too high. And don't let me start with pension. Europe is basically starving an entire generation, you don't see it now, you will see in 30 years when the young of today will start to go into retirement age. There will be no money to pay a real pension to everybody. You know how much you need to have a very comfortable pension? At a 6% rate, about 500 euro a month for 40 years. That's it, that's all you need. Right now we are paying close to this amount for a public pension, will we see that money? Absolutely not. Bottom line: they have to fix the economy. That's the only long term solution and the only way to bring people out of unemployment and poverty.
  • hliyan 11y ago
    We should do more back-of-envelope calculations for countries, along the lines of: (cost of healthcare + pensions + welfare + welfare bureaucracy + corruption) / population > basic income ? If the value is greater or equal, basic income makes sense right off the bat.
    • pjc50 11y ago
      I hope you're not proposing that basic income is a replacement for healthcare? They're two completely different things.
      • 11y ago
• bmir-alum-007 11y ago
  The next concern of implementation: extremely common for people whom aren't good with money tend to not budget or buy what they need, and end up in crises of failure-to-plan ahead (economists call them "high MPC"). Some people will need guidance as to what to buy. Others won't. A related concern is when people whom aren't good with money suddenly receive a pile of it: the sad Anna Nicole Smith syndrome: excesses in all things apart from improving or acquiring basic necessities. It's common in human nature to really screw up, and it literally kills some people. There has to be some programs/assistance which can offer/help locate specific recommendations and get people out of a bind at least once. Hopefully, it can be implemented in a way which reduces risks of negatives and offers useful, advantageous advice without treating people as children or dipping into their privacy without permission.
  • pjc50 11y ago
    I'd assume that a basic income would be paid weekly, which avoids the "lump sum" problem entirely and helps with budgeting.
    • ptaipale 11y ago
      In Finland this would surely be monthly.
  • gpvos 11y ago
    > The core question of basic income is: if people work, do they lose it entirely? No. That is the point: it is for everyone. In the Netherlands, a few cities intend to start experimenting with a variant: only jobless people get a basic income, but they will keep it when they find work. > The next concern of bringing into reality: extremely common for people whom aren't good with money [...] On this, data is available. Giving money directly to poor people turns out, on average, to be the best way to help them. Most of them will spend the money wisely, the ones who fail at it are pretty few.
  • andor 11y ago
    The core question of basic income is: if people work, do they lose it entirely? No, that's the whole point of it, and the difference to regular systems with unemployment benefits: it's extremely simple to administer, because everybody gets the same amount. Also, even if you pursue a very low-paying job, you will always earn more than people who don't work at all.
• kpil 11y ago
  Great, the Finns can have our 100.000+ refugees that comes to us in Sweden.
  • sopooneo 11y ago
    I wondered this too. If a small country implements basic income, they really will have to put strict limits on immigration. If the whole world was doing it, it wouldn't matter as much.
    • troels 11y ago
      There are already a lot of restrictions on immigration in rich countries for this exact reason.
• jbb555 11y ago
  You remove the marginal disincentive to work at the low income end. This is good. However you add a large incentive to give up work at the higher end. As an example, I own a house in london. I'm by no means rich but I have a fairly decent income and significant savings. Enough that if I downsized my house and lived frugally I could support myself for 10-15 years. That's not enough to retire on. If I was to receive £4-5 free income a year though, it would make enough different that my saving would last 20 years or more and I'd be able to give up work now. There might be a relative small number of people in my situation, but together we probably pay a great deal of tax that would be lost. I think it is this that dooms any such scheme.
  • pjc50 11y ago
    I'm assuming you meant "£4k-5k" there - and if you own property in London, you're almost certainly getting more than that in asset price appreciation. You could probably live the rest of your life on equity withdrawal schemes.
  • onion2k 11y ago
    There might be a relative small number of people in my situation, but together we probably pay a great deal of tax that would be lost. You've made a basic error in your assumptions - you're assuming that when you quit your job ceases to exist. It doesn't. Someone else would do it instead, being paid what you're paid, and paying the tax that you pay. So long as the number of people leaving the workforce to live on their basic income + savings is smaller than the number of currently unemployed people then the tax receipts wouldn't change. In fact, with the consequent savings on employment benefit, the amount of tax to spend on services would go up.
    • jlebrech 11y ago
      so it'll increase the efficiency of the workforce, instead of people just doing ANY job to survive they can take a short break while they look for what they really want to do in life. You could pursue a hobby creating computer games, and when your game is ready you can they make profit and start paying back to society. The work/welfare system stifles innovation, people with skills end up doing work they hate, those who wanted that job have to get a job they don't want and the unemployable take advantage of the system to watch TV all day.
• elcct 11y ago
  They just want to set 0 level a bit higher. Basically having basic income will be considered as having nothing. What a stupid idea.
• netcan 11y ago
  Basic incomes have always been an interesting idea, appealing to a lot of smart people from radically different economic-political camps. There are some potential massive wins on long term unemployment that come from eliminating incentive issues, some answers to the "living wages" and other positive rights problems. Less bureaucratic micromanaging of people's lives. There's a reason it hold attention on HN, it's a real interesting idea. But….. Basic income is the type of idea that is very, very hard to implement within our current (possibly any) political systems. There is very little room for compromise, half measures and gradualism. It does not lend well to caveats exemptions, and design by committee. One of the big selling points is that basic income is funded largely by replacing different welfare state institutions: unemployment benefits, child benefits, housing subsidies, state housing, pensions… This allows (A) A big enough basic income (B) big savings on welfare institutions running costs, (C) the simplicity needed for a clean re-write of incentives. Where do the "efficiency savings" come from? Largely they come by cutting salaries associated with managing a welfare system. Can a government reduce public sector employment to that extent? The danger for any country implementing this is that once they get into the political procee, they will chop and compromise and water down the idea until it is just another item on the big list of ingredient in the social welfare soup €212.13 per month that you qualify for while keeping everything else that exists. Reforming the tax system and the welfare system as radically as required in a short time is a tall order. Maybe the Finnish can pull it off. They have a good track record. More broadly, I expect that this would have a high failure rate. The best chance (IMO) is for very a small country to try it first.
  • mtgx 11y ago
    I agree those are all huge hurdles and it's incredibly risky, too, as it could be catastrophic if doesn't work, and you would have to cut all of those jobs, and then you also have to revert all the social programs back back. It could turn into a decade of pain for that society. However, I think this pilot will at least tell us if a basic income works from the point of view of whether it can be sustainable on itself and whether 90% of the working people will quit working or not. Right now we have no clue whether something like that would happen or not, and it's probably the riskiest thing about a basic income - having 9 out of 10 people sit around and do nothing while the other 1 out of 10 have to support them. If the outcome for that is a positive one and most people continue to get jobs, then we can start making a well thought-out plan on how to do the transition with the minimum damage possible to the society (until the transition is complete and then there's a net positive from the basic income for everyone).
• jsf666 11y ago
  So i should work so that a lazy bum gets my money? Seems like a plan. Or we just hand the money everyone and see hyperinflation?
  • jsf666 11y ago
    The people who downvote could elaborate on how this magnificient plan should work. And why it should be implemented? Because communism on paper also seems like a valid idea and then millions die
    • tariqali34 11y ago
      Plans in general fail as soon as they hit cold reality. There will be problems with implementation, inglorious watered-down compromises, corruption, unforeseen consequences, etc. The funny thing is though that political radicals will not view their original plan as flawed, only the 'deviations' from that plan. For example, some communists would argue that the reason communism failed was because it deviated from the "paper" version. See 'actually existing communism' and the Nomenklatura (New Class) for more information.
      • jsf666 11y ago
        How much more genocides are needed before some crazy idealists realize that communism is a utterly dangerous idea that has little to do with reality? We had/have the Soviets, NK, China, Cambodia and few others with the toll in tens of millions (or more than a hundred) and some entitled middle-upper class pricks still want to "save the world" with this flawed to the core idea?
• jfaucett 11y ago
  This is great. One of the main reasons I think political progress is so slow is because its near impossible to experiment with any new ideas. Few countries can just scratch something and say ok that didn't work lets try something else - because 10s of millions of people are already working in or dependent on said system. There are however a handful of countries in the world that can actually do this, because of the wealth and relatively small populations they have. Finland is one of those, so this is exiting. The same problem exists in city planning. I'm sure civil engineers could design much more environmentally friendly and efficient cities, free of cars and with optimal transit, waste, and housing systems. But you always have an existing city where millions already live and work, and you have to have 20/30 year plans to get anything changed. Its like trying to build a new piece of software but having to mold it out of a 20 year old monolithic legacy app where everything is interconnected and you have to maintain full backwards compatibility.
• acd 11y ago
  Finland has an aging population and too low birth rate 1.8 / little migration to support the elderly. The need to fix the 0.2.
  • jpatokal 11y ago
    Unconditional basic income is certainly not going to hurt, as it'll make one parent staying home to take care of the kids a lot more feasible financially.
    • adventured 11y ago
      With 10% unemployment, and the last eight years consisting of a non-stop stagnation / recession (Finland has had zero net GDP growth since 2007) - how would removing workers from the labor pool not crash the economy even further? Finland is very likely to see its GDP stay at 2007 levels for at least a 15 to 20 year period of time. There's nothing indicating growth or recovery is inbound (things have only been getting worse the last three years). I don't see how it can all be paid for with a broken economy. Unless the premise is to drop concern for total economic output, and strictly focus on redistribution to raise the median. That seems like a huge leap of faith, unless you can get tax revenues to climb with greater economic growth.
• tarvaina 11y ago
  Although there seems to be enough support by MPs for basic income so that it realistically could be trialled, I wouldn't be holding my breath. The government has too many other things on its plate. Finland is suffering from a period of slow growth and rising unemployment. The three immediate reasons are the economic troubles of euro area, the decline of Nokia, and the trade sanctions against Russia, one of Finland's largest trading partners. Add to that the quick rise of wages until 2008, the aging population, an expensive social welfare system, and the inability to devalue the local currency, and the troubles seem very hard indeed. The government's main goal is to adapt the Finnish economy to the new reality, by spurring growth and improving state fiscals. It has many options on its plate, basic income being one of them. Currently, however, the government's focus seems to be in short-term. The current hot topic is the so-called "social contract", which is essentially government trying to make a deal with labor unions to increase the length of work week from 37,5 hours to 40 (or a similar reduction in wages). This plan, perhaps not so surprisingly, seems to be failing. After it is buried (probably within the next few days), the government may try "fiscal devaluation", i.e. moving tax burden from companies to citizens. And then some painful public finance cuts. And after that, who knows what? Regarding long-term efforts, other pending reforms have more support than basic income, but still not enough agreement to be hammered out quickly. The two most important ones are health care reform and the change of municipality responsibilities. Both of these have been in talks for years without signs of being resolved. All this is made more difficult by the fact that the rising populist party 'The Finns' is in government for the first time, still learning how it wants to play the game. In summary, it isn't clear when the government will move from short-term considerations to longer-term restructuring, and if the basic income will still be on the plate then. Edit: grammar.
• deleted 11y ago
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• TheSpiceIsLife 11y ago
  This always reminds me of that quote "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury."[1] 1. presumably someone did actually write or say this at some point, seems to be unclear as to who that person was.
  • dTal 11y ago
    I did the googling for you: <<[It] is a variant expression of a sentiment which is often attributed to Tocqueville or Alexander Fraser Tytler, but the earliest known occurrence is as an unsourced attribution to Tytler in "This is the Hard Core of Freedom" by Elmer T. Peterson in The Daily Oklahoman (9 December 1951)>> Source: https://en.wikiquote.org/wiki/Alexis_de_Tocqueville https://en.wikiquote.org/wiki/Alexis_de_Tocqueville
    • TheSpiceIsLife 11y ago
      Yep, I've done the Googling a few times and as I looked further in to the attribution change it became progressively unclear. Not sure how much we should trust an "unsourced attribution".
• jpatokal 11y ago
  Finn here. Some figures to put the floated numbers of 500-1000 euros/month in perspective: Average salary, before tax: 3150 EUR Average salary, after tax: ~2000 EUR Market rent for one bedroom apartment in central-ish Helsinki: 1000 EUR In other words, 500 EUR/month is a tolerable budget for a skin-flint student living in subsidized/free accommodation, but it's going to be pretty tough going for an adult, and completely prohibitive for eg. raising a family. 1000 EUR would be more realistic, but obviously also twice as expensive to implement.
  • aft42 11y ago
    > completely prohibitive for eg. raising a family But if it's an unconditional guaranteed income, i.e. each member of the family is making it, then it shouldn't be a problem. For example, a single mother with two kids would get her 500 EUR/month plus 500 EUR/month for each kid, bringing in a total of 1500/month for the family. While this certainly isn't massive, with a part-time job and being frugal, it should enable her to pay the bills.
    • adventured 11y ago
      How would 1,500 euros enable her to pay the bills, if rent alone is 1,000? It wouldn't be even remotely close after all life expenses are added in.
      • moftz 11y ago
        Thats why he said part-time job too.
        • aft42 11y ago
          Yes, the "with a part-time job and being frugal" was a critical part of my post that @adventured clearly missed. Thank you for highlighting it.
      • kisstheblade 11y ago
        Also, you don't have to live in the most expensive part of the most expensive city... Good livable apartments can be had for 300e-400e/month, even in the larger cities.
• bmir-alum-007 11y ago
  Food for though: raw cost for a below-poverty annual subsidy of $12.5k to all adults in the United States: 209,128,094(&) * 12,500 = 2.6 trillion USD/year That's equal to about 66% of the 2015 federal budget or 15% of 2015 GDP. Would that make it affordable or unaffordable? Notes: & http://www.infoplease.com/us/census/data/demographic.html http://www.infoplease.com/us/census/data/demographic.html
  • adventured 11y ago
    It would make it impossible unless you dramatically slash Social Security, Medicare/Medicaid, and the military. Every time basic income comes up, the one thing persistently avoided is running the budget and taxation numbers needed to support it (and there are endless excuses raised for why that discussion is avoided). $2.6 trillion (basic income) + $600 billion (military) + $1.2 trillion (SS) + $1 trillion (M/M) = $5.4 trillion, and that's before you get into all the other costs of government. Throw on another $400 billion in other mandatory spending costs, and another couple hundred billion in other discretionary spending items. $6 trillion is the minimum out of that, just for the Federal Government. Now throw in $3 trillion for local and state. $9 trillion in total government costs out of an $18 trillion economy. Pretty obvious what would happen to that system. And it's why nobody ever wants to discuss actual numbers.
    • IanCal 11y ago
      > And it's why nobody ever wants to discuss actual numbers. I do. I want to talk about actual numbers because I think it'll be interesting to work out what might or might not be affordable. But I get rather frustrated that people either provide no numbers or do what you've just done and multiply the basic income amount by the total number of people and go no further. You're making the assumption that everyone gets $12.5k more post-tax. That's not what many people would propose. There's also a reduction in the number of benefits and other programs that need to be funded (in the UK, anything above £4000 would eliminate the need for job-seekers allowance and several other benefits). SS is $1.2T, but some portion of that would be covered by BI. The money also doesn't evaporate, one of the arguments in favour of large scale wealth redistribution like this is the people you distribute it to are the ones who are most likely to spend it. It's an extremely complex issue, and both those saying "everything would be wonderful" and "X * Y = $$$ is too much" are doing it a disservice.
• pluma 11y ago
  In response to the deleted comment because I had already typed it out when the parent was deleted: > proof that unemployment benefits incentivizes staying at home I have yet to see conclusive evidence for this "people are lazy" argument. Humans aren't rational actors in a vacuum (except psychopaths). There is social pressure to contribute to society and "carrying your own weight" -- just ask anyone who's ever spent a non-trivial amount of time unemployed. BI can be more than a replacement for current welfare but it aligns very nicely as a replacement for the current systems of unemployment benefits. Of course there are people with special needs and of course BI can't replace all of the welfare system but it significantly reduces a lot of complexity. In my opinion, the potential effects of a BI are far greater than just redistributing wealth (which the tax-sponsored welfare system already does). It raises the barrier from zero to a liveable wage. IMO this entirely eliminates the need for minimum wages and drastically changes the dynamics of the job market. It significantly reduces the inequality in the labour/capital struggle -- it eliminates the major social factor of "will I lose all of my possessions and ruin my family's lives" from fundamental job decisions. Instead of having to worry about your (and your family's) continued financial and social existence when you lose your job (or your company tanks or whatever) you have a built-in financial safety net making sure that even if you do fall, you won't hit rock bottom. Basically it's "rich parents for everyone". > everyone thinks "I'll get more" or "they'll get more" But that's not what it's about. In all likelihood, if implemented correctly, most people will get pretty much what they have now or maybe less. But as with existing unemployment and welfare systems, BI guarantees that you won't be out on the street if your employment situation changes. Unlike most existing unemployment or welfare systems, BI also creates a smooth transition for when you do find a new job (or start a new company). It's a zero sum game. It has to be. Everybody can't be better off financially merely because of a universal basic income. It's the market dynamics that change, not the amount of money in the system. You're basically arguing against welfare, not against the BI. BI is no more about closing the gap between the rich and the poor than welfare is. It's like socialised healthcare (a recent import from communist East Bloc countries like the UK): it's not about helping you when you're already fine, it's about preventing your life from being ruined when you're not fine anymore. > it's not popular to disprove BI here You're merely disapproving, not disproving. That's why you get the downvotes.
• Gustomaximus 11y ago
  Rather than a guaranteed income, I think a better system would be a guaranteed jobs. This would work better than basic income as there are 2 type of unemployed (let's leave out the disabled for this discussion). Those that want to work, but can't find work. And those that simply don't wish to work or conform to a work environment. Given this why not have a 2 tier unemployment offering. The first is a guaranteed job. Ideally covering areas that don't compete with non-essential open market business. So things like looking after parks and helping out in nursing homes. General community benefit programs. This way if someone is out of work the government guarantees minimum wage at X hours a week to keep people in work and not go into that unemployment rut where after extended time they find it hard to re-enter the workforce.. The remain a productive member of society for their own self-worth while working gives the opportunity to upskill or show they are productive people while looking for better paying work. And given they are already working there is not the problem that taking a job earns them little more than being unemployed anyway. For those that are capable but refuse to work they are offered a bare minimum living environment for pure humanity sake. Something like a bed in a dorm and 3 hot meals environment but they lack personal luxuries until they are willing to be productive and this keeps costs are kept at a minimum. It also solves the view of people who feel like unemployed are all bludgers as it separates those that are victim of circumstance vs unwilling to work. This way we don't punish people who are willing to be productive but the economy does not have capacity to offer employment, and minimise the cost and incentive for people to abuse the system. I'm sure it's not that simple in reality but having a one size fits all seems limiting. Something down this route would better allow for people in differing circumstances.
  • seanmcdirmid 11y ago
    India has this, and it involves moving dirt back and forth between ditches. Pointless and soul crushing.
    • deleted 11y ago
      [deleted]
    • Gustomaximus 11y ago
      I'm not sure the point of this comment. Is it just for anecdotes sake? If not it sounds like you have a problem with the type of work being offered in this particular example. Not the concept. One (arguably) bad example doesn't make an entire concept void.
• deleted 11y ago
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• wahsd 11y ago
  Isn't basic income really pretty dependent on closing borders? So you have a basic income ... here come the stampedes of African and East European low skilled immigrants looking to get a basic income without having to do anything. Essentially, also how do you move people from basic income to being ambitious to pursue more than basic income. People become complacent when they become comfortable with their circumstances. I don't think that is appreciated enough in this discussion. People really need to be kept slightly "on their toes". If you look at the USA, that is precisely what happens here, for better or worse and even to an extreme and unhealthy manner. We have extreme poverty relative to other societies we want to consider ourselves to be peers of, but at the same time we have these unachievable dream motivations in the form of grotesquely wealthy people in the form of CEOs, athletes, movie stars, musicians, etc. that 99.99999% of people will never ever get even close to reaching.
• kisstheblade 11y ago
  As long as this cuts off all other social security payments, like for housing and child care etc. So if you are poor then you have to live cheaply. It's ridiculous that the only people who can afford to live in downtown Helsinki are the very rich and the unemployed... "They have to live near where the work is!", what a joke...
• iamcurious 11y ago
  I wonder how this interacts with savings, credit and location. Knowing that you are guaranteed an income would mean that people could spend all their income. It would also mean that it would be a lot less risky to offer certain level of credit. Lastly, it would allow people to go and live where life is cheaper. It seems to decouple many complex concerns.
• firichapo 11y ago
  Has anyone tried to implement basic income using crypto-currencies? Is it feasible?