7 ms·

While I find UBI to be a fascinating idea worthy of consideration, I vehemently disagree with running this experiment in East Africa. The proposal seems to eith

While I find UBI to be a fascinating idea worthy of consideration, I vehemently disagree with running this experiment in East Africa. The proposal seems to either be blind-to or minimizing the potential for unintended consequences. Decades of trying to alleviate poverty in Africa have taught us, more than anything else, that the road to hell is paved with good intentions. Giving food tends to act as “dumping” and weaken the agricultural industry. Providing foreign aid tends to empower corrupt governments. These consequences only became clear after years of hindsight. Who knows what unintended side effects of UBI will be? If we are going to try UBI, a fundamentally Western idea, it’s only right that it should be tried in the West. I’m not saying it won’t work - just that we don’t really know what will happen. East Africa has suffered enough from our neo-colonial experiments.

oconnor663 10y ago
This seems to be an argument against operating any charities at all in East Africa. That must be controversial?
- flatline 10y ago
  It could certainly spell doom for future UBI proposals if the first prominent implementation goes badly, and it could be that it went badly due to factors that are simply not as prevalent in the West.
  - scotty79 10y ago
    I think UBI will fare way worse int the West because of how many people rent places to live. UBI will get mostly sucked by landlords.
    - Integer 10y ago
      How about Eastern Europe? There are some extremely poor, yet relatively educated countries, and due to the Soviet legacy, the majority owns the places they live in.
      - scotty79 10y ago
        Yes. This should work. Maybe even in Poland, surely east of Poland. In the west I think UBI won't work well unless people who own a lot of real estate are incentivised to sell some with progressive real estate tax.
- nostrebored 10y ago
  Really, throughout the literature it's not that controversial. Doing any amount of research on aid in SSA you see nearly 100% of efforts go poorly in the long term. Most arguments in the other direction have very 'interesting' definitions of success or argue a moral imperative.
Apocryphon 10y ago
I don't know how much worse East Africa is compared to other parts of sub-Saharan Africa, but Namibia has enacted basic income before with positive results. https://en.wikipedia.org/wiki/Basic_income_around_the_world#Namibia https://en.wikipedia.org/wiki/Basic_income_around_the_world#... But then again, it was the country's own government, not some outside NGO.
- tosseraccount 10y ago
  "it was mainly funded by a German Protestant church, by individual contributions of German and Namibian citizens and by contributions of the German Ministry for Cooperation. The amount paid out per head was N$100 (around US$12)." -from your link
samstave 10y ago
>Giving food tends to act as “dumping” and weaken the agricultural industry. What the fuck? Are you not aware of the MASSIVE subsidies that are given all throughout agriculture to give away basically billions of tons of food to animals? Why not do the same for ensuring that the food is consumed by people...
rossdavidh 10y ago
So, we do all the colonial stuff you mentioned (and plenty more you could have mentioned), and then when someone suggests we provide Universal Basic Income in that same region, we suddenly get a "conscience" about it and say no way, it might go wrong? I'd have to say, that sounds a little off, to me.
- nostrebored 10y ago
  Right, because using Africans as a guinea pig for an unproven economic system isn't colonialist at all.
  - jonny_eh 10y ago
    It's free money for them. If someone wants to experiment on me by giving me free money, have at it.
    - alttab 10y ago
      Said the future slave.
      - jjawssd 10y ago
        Live and let live
    - Hondor 10y ago
      China used to "donate" underpriced solar panels to Americans. When Americans found out, they said go away! [1] They'd rather pay more than receive government aid from another country. They even have a negative sounding a name for this charity - they call it "dumping" and don't allow other countries to do it to them. So if you're like an American, it's quite possible you won't take their money. [1] http://www.nytimes.com/2014/12/17/business/energy-environment/-us-imposes-steep-tariffs-on-chinese-solar-panels.html http://www.nytimes.com/2014/12/17/business/energy-environmen...
      - 10y ago
thescriptkiddie 10y ago
Unconditional cash transfers (what is being proposed here) have proven to be more effective than the "dumping" of material aid you're protesting. If you give a village shipments of rice their rice farmers go bankrupt, if you give them cash they can spend it at local businesses or start businesses of their own or import things they couldn't get otherwise. It's also hard to give too much cash (as long as you are distributing it equitably), because if there is excess capital in one place that will only encourage trade. http://www.poverty-action.org/study/impact-unconditional-cash-transfers-kenya http://www.poverty-action.org/study/impact-unconditional-cas...
scotty79 10y ago
> Who knows what unintended side effects of UBI will be? Care to make a guess?
- cpeterso 10y ago
  Perhaps people from neighbor countries will emigrate, seeking UBI?
  - perfunctory 10y ago
    > Targeting: All full-time residents of treatment villages. Payments continue if subjects migrate out and are not delivered to new subjects who migrate in. from https://givedirectly.org/basic-income https://givedirectly.org/basic-income
- nostrebored 10y ago
  Increases in the prices of goods in a 1:1 fashion with income, especially staples? Creating a dominate telco market where having a phone is necessary (and therefore phone prices will be disproportionately higher?)? These are just some reasonable non-catastrophist concerns, which I'm sure there are a number of.
  - scotty79 10y ago
    > Increases in the prices of goods in a 1:1 fashion with income For locally produced goods should be fine because producers are poor too. For imported goods it might be harmful because UBI cash could get sucked back out of the poor region really quickly. What I'm hoping is that sucking cash out with imports will correlate with increased volume (that it won't be 1:1 exactly) of imports of useful equipment that is not manufactured locally. > Creating a dominate telco market where having a phone is necessary (and therefore phone prices will be disproportionately higher?)? Don't they already use phones for small banking like money transfers?
ppereira 10y ago
There is quite a bit of anger and little fact in this comment. GiveDirectly has been running UBI programs in East Africa for years now. They have an all-star cast of economists examining their performance. Their pilot programs were very successful, which is why they are scaling out further. East Africa, and Kenya in particular, was carefully chosen for two reasons. First, Kenya has a mobile phone network that makes it easy to transfer funds electronically to individuals and then for those individuals to get cash from the funds at local stores. I wish we had this in the West, but we don't because of banking regulations. Second, poorer households in certain communities tend to use natural roofing materials rather than aluminum, which makes it easy to target funding by satellite. The UBI is a political football in the West. The Mincome experiment was cancelled because of a change in government. The potential utility benefits from a UBI are so great that it would be a shame to think that we have to wait for it to be politically palatable in the West before we can get any data on its effectiveness. Also, as far as poverty relief is concerned, money really does help.
- alttab 10y ago
  You seem to know a lot of the detail. How are you affiliated with GiveDirectly? Also, this post also has little fact when the emotive aspects of it contain phrases like "all star cast", "very successful", "political football", "benefits so great", "would be a shame." Where's the facts?
  - colah3 10y ago
    I'm not the GP, but I have a similar impression that GiveDirectly has really strong evidence supporting it. GiveWell -- a separate organization that does in depth analysis of giving opportunities -- has a detailed write up on them: http://www.givewell.org/International/top-charities/give-directly http://www.givewell.org/International/top-charities/give-dir... GiveWell recommends GiveDirectly as one of their top charities. GiveDirectly's intervention has been tested by multiple randomized controlled trial, including a large-scale one. (See the GiveWell write up for details.) In general, the case of them seems much stronger than most charitable interventions. (I have no affiliation with GiveDirectly, though I'm close friends with many GiveWell staff.)
jefe_ 10y ago
When people in Haiti receive bags of USAID Rice (grown elsewhere) for free, there no longer is a need for Haitian Grown Rice and it hurts local farmers. I'm not sure this translates to direct injections of cash however. I've spent time in East Africa and everyone always asks, what does Africa 'need.' I typically say: money. There are lots of great ideas and lots of enterprising people at all social levels of the region, but the one thing between everyone and further development is personal income. There are roads being built by China, Water is the next big infrastructure requirement, but as for the average person in East Africa, an injection of steady cash is world changing. The only way the plan becomes toxic is if the guaranteed income ever goes away, which is an admittedly massive qualifier, but if a plan can be devised to incorporate money management resources and nationwide healthy spending mindsets, and the plan can be supported indefinitely, it has the potential to radically change the day to day experience of many people in the region.
- rewrew 10y ago
  I regularly do low-interest loans to African entrepreneurs via Zidisha -- that's money that's helpful in a concentrated way, vs. bulk money that I'm skeptical won't have negative consequences.
  - 2noame 10y ago
    In that case, you may want to read this. http://www.theguardian.com/global-development-professionals-network/2015/jun/10/the-microfinance-delusion-who-really-wins http://www.theguardian.com/global-development-professionals-...
    - rewrew 10y ago
      I'm skeptical because I mainly loan to the same people again and again, and they pay it back again and again. So there's something going on there.
jxramos 10y ago
Unintended consequences for sure, makes me think of https://en.wikipedia.org/wiki/Dambisa_Moyo#Dead_Aid https://en.wikipedia.org/wiki/Dambisa_Moyo#Dead_Aid. I'm starting to give hearing to the common criticism I've heard Ramesh Ponnuru say a lot which is something along the lines of policies not "generating wealth"
notahacker 10y ago
On a scale of economic harms done by intervention in East Africa, I don't think the worst conceivable side effects of this (localised inflation and a bit of resentment from surrounding communities, basically) really compare with the harmful side effects of the everyday trade that East African countries need to participate in to grow economically, and Kenya's economy is very far from an economy untouched by NGO projects as is. On the other hand, the scheme gives a whole bunch of mostly very poor people get to eat a bit better or buy a motorbike without repaying it - probably to an aid-backed MFI - at 60% APR (and I say that even as someone who's largely unconvinced of a case for UBI in the West, wholly unconvinced this experiment will tell us anything at all about the likely effects of UBI in the West and - from the RCT papers I've read - think the benefits of cash transfers in developing countries are overstated by their most enthusiastic advocates.)

oconnor663 10y ago

This seems to be an argument against operating any charities at all in East Africa. That must be controversial?

flatline 10y ago
It could certainly spell doom for future UBI proposals if the first prominent implementation goes badly, and it could be that it went badly due to factors that are simply not as prevalent in the West.
- scotty79 10y ago
  I think UBI will fare way worse int the West because of how many people rent places to live. UBI will get mostly sucked by landlords.
  - Integer 10y ago
    How about Eastern Europe? There are some extremely poor, yet relatively educated countries, and due to the Soviet legacy, the majority owns the places they live in.
    - scotty79 10y ago
      Yes. This should work. Maybe even in Poland, surely east of Poland. In the west I think UBI won't work well unless people who own a lot of real estate are incentivised to sell some with progressive real estate tax.
nostrebored 10y ago
Really, throughout the literature it's not that controversial. Doing any amount of research on aid in SSA you see nearly 100% of efforts go poorly in the long term. Most arguments in the other direction have very 'interesting' definitions of success or argue a moral imperative.

Apocryphon 10y ago

I don't know how much worse East Africa is compared to other parts of sub-Saharan Africa, but Namibia has enacted basic income before with positive results. https://en.wikipedia.org/wiki/Basic_income_around_the_world#Namibia https://en.wikipedia.org/wiki/Basic_income_around_the_world#... But then again, it was the country's own government, not some outside NGO.

tosseraccount 10y ago
"it was mainly funded by a German Protestant church, by individual contributions of German and Namibian citizens and by contributions of the German Ministry for Cooperation. The amount paid out per head was N$100 (around US$12)." -from your link

samstave 10y ago

>Giving food tends to act as “dumping” and weaken the agricultural industry. What the fuck? Are you not aware of the MASSIVE subsidies that are given all throughout agriculture to give away basically billions of tons of food to animals? Why not do the same for ensuring that the food is consumed by people...

rossdavidh 10y ago

So, we do all the colonial stuff you mentioned (and plenty more you could have mentioned), and then when someone suggests we provide Universal Basic Income in that same region, we suddenly get a "conscience" about it and say no way, it might go wrong? I'd have to say, that sounds a little off, to me.

nostrebored 10y ago
Right, because using Africans as a guinea pig for an unproven economic system isn't colonialist at all.
- jonny_eh 10y ago
  It's free money for them. If someone wants to experiment on me by giving me free money, have at it.
  - alttab 10y ago
    Said the future slave.
    - jjawssd 10y ago
      Live and let live
  - Hondor 10y ago
    China used to "donate" underpriced solar panels to Americans. When Americans found out, they said go away! [1] They'd rather pay more than receive government aid from another country. They even have a negative sounding a name for this charity - they call it "dumping" and don't allow other countries to do it to them. So if you're like an American, it's quite possible you won't take their money. [1] http://www.nytimes.com/2014/12/17/business/energy-environment/-us-imposes-steep-tariffs-on-chinese-solar-panels.html http://www.nytimes.com/2014/12/17/business/energy-environmen...
    - 10y ago

thescriptkiddie 10y ago

Unconditional cash transfers (what is being proposed here) have proven to be more effective than the "dumping" of material aid you're protesting. If you give a village shipments of rice their rice farmers go bankrupt, if you give them cash they can spend it at local businesses or start businesses of their own or import things they couldn't get otherwise. It's also hard to give too much cash (as long as you are distributing it equitably), because if there is excess capital in one place that will only encourage trade. http://www.poverty-action.org/study/impact-unconditional-cash-transfers-kenya http://www.poverty-action.org/study/impact-unconditional-cas...

scotty79 10y ago

> Who knows what unintended side effects of UBI will be? Care to make a guess?

cpeterso 10y ago
Perhaps people from neighbor countries will emigrate, seeking UBI?
- perfunctory 10y ago
  > Targeting: All full-time residents of treatment villages. Payments continue if subjects migrate out and are not delivered to new subjects who migrate in. from https://givedirectly.org/basic-income https://givedirectly.org/basic-income
nostrebored 10y ago
Increases in the prices of goods in a 1:1 fashion with income, especially staples? Creating a dominate telco market where having a phone is necessary (and therefore phone prices will be disproportionately higher?)? These are just some reasonable non-catastrophist concerns, which I'm sure there are a number of.
- scotty79 10y ago
  > Increases in the prices of goods in a 1:1 fashion with income For locally produced goods should be fine because producers are poor too. For imported goods it might be harmful because UBI cash could get sucked back out of the poor region really quickly. What I'm hoping is that sucking cash out with imports will correlate with increased volume (that it won't be 1:1 exactly) of imports of useful equipment that is not manufactured locally. > Creating a dominate telco market where having a phone is necessary (and therefore phone prices will be disproportionately higher?)? Don't they already use phones for small banking like money transfers?

ppereira 10y ago

There is quite a bit of anger and little fact in this comment. GiveDirectly has been running UBI programs in East Africa for years now. They have an all-star cast of economists examining their performance. Their pilot programs were very successful, which is why they are scaling out further. East Africa, and Kenya in particular, was carefully chosen for two reasons. First, Kenya has a mobile phone network that makes it easy to transfer funds electronically to individuals and then for those individuals to get cash from the funds at local stores. I wish we had this in the West, but we don't because of banking regulations. Second, poorer households in certain communities tend to use natural roofing materials rather than aluminum, which makes it easy to target funding by satellite. The UBI is a political football in the West. The Mincome experiment was cancelled because of a change in government. The potential utility benefits from a UBI are so great that it would be a shame to think that we have to wait for it to be politically palatable in the West before we can get any data on its effectiveness. Also, as far as poverty relief is concerned, money really does help.

alttab 10y ago
You seem to know a lot of the detail. How are you affiliated with GiveDirectly? Also, this post also has little fact when the emotive aspects of it contain phrases like "all star cast", "very successful", "political football", "benefits so great", "would be a shame." Where's the facts?
- colah3 10y ago
  I'm not the GP, but I have a similar impression that GiveDirectly has really strong evidence supporting it. GiveWell -- a separate organization that does in depth analysis of giving opportunities -- has a detailed write up on them: http://www.givewell.org/International/top-charities/give-directly http://www.givewell.org/International/top-charities/give-dir... GiveWell recommends GiveDirectly as one of their top charities. GiveDirectly's intervention has been tested by multiple randomized controlled trial, including a large-scale one. (See the GiveWell write up for details.) In general, the case of them seems much stronger than most charitable interventions. (I have no affiliation with GiveDirectly, though I'm close friends with many GiveWell staff.)

jefe_ 10y ago

When people in Haiti receive bags of USAID Rice (grown elsewhere) for free, there no longer is a need for Haitian Grown Rice and it hurts local farmers. I'm not sure this translates to direct injections of cash however. I've spent time in East Africa and everyone always asks, what does Africa 'need.' I typically say: money. There are lots of great ideas and lots of enterprising people at all social levels of the region, but the one thing between everyone and further development is personal income. There are roads being built by China, Water is the next big infrastructure requirement, but as for the average person in East Africa, an injection of steady cash is world changing. The only way the plan becomes toxic is if the guaranteed income ever goes away, which is an admittedly massive qualifier, but if a plan can be devised to incorporate money management resources and nationwide healthy spending mindsets, and the plan can be supported indefinitely, it has the potential to radically change the day to day experience of many people in the region.

rewrew 10y ago
I regularly do low-interest loans to African entrepreneurs via Zidisha -- that's money that's helpful in a concentrated way, vs. bulk money that I'm skeptical won't have negative consequences.
- 2noame 10y ago
  In that case, you may want to read this. http://www.theguardian.com/global-development-professionals-network/2015/jun/10/the-microfinance-delusion-who-really-wins http://www.theguardian.com/global-development-professionals-...
  - rewrew 10y ago
    I'm skeptical because I mainly loan to the same people again and again, and they pay it back again and again. So there's something going on there.

jxramos 10y ago

Unintended consequences for sure, makes me think of https://en.wikipedia.org/wiki/Dambisa_Moyo#Dead_Aid https://en.wikipedia.org/wiki/Dambisa_Moyo#Dead_Aid. I'm starting to give hearing to the common criticism I've heard Ramesh Ponnuru say a lot which is something along the lines of policies not "generating wealth"

notahacker 10y ago

On a scale of economic harms done by intervention in East Africa, I don't think the worst conceivable side effects of this (localised inflation and a bit of resentment from surrounding communities, basically) really compare with the harmful side effects of the everyday trade that East African countries need to participate in to grow economically, and Kenya's economy is very far from an economy untouched by NGO projects as is. On the other hand, the scheme gives a whole bunch of mostly very poor people get to eat a bit better or buy a motorbike without repaying it - probably to an aid-backed MFI - at 60% APR (and I say that even as someone who's largely unconvinced of a case for UBI in the West, wholly unconvinced this experiment will tell us anything at all about the likely effects of UBI in the West and - from the RCT papers I've read - think the benefits of cash transfers in developing countries are overstated by their most enthusiastic advocates.)