Basic Income Is Being Set Up to Fail

The current crop of basic income trials fall painfully short of holding society-changing potential.

May 2 2018, 2:00pm

Screengrab: YouTube

Universal basic income sounds utopian, and in some iterations it is: A livable income paid to every person, perhaps as a way to distribute the profits from automated labour to all of society, that could wean us off of capitalism and put us on the path to a Star Trek-style future where waged work is a bad memory.

But some on the political left, a group to whom basic income should inherently appeal according to news story after news story, have soured on the idea. After reporting on an ongoing Canadian basic income trial in Hamilton, Ontario in February and observing other trials around the world from a distance, I think they’re right.

The basic income trials of today not only fall painfully short of holding society-changing promise, but their failures could be used as cover for even more restrictive social programs. Basic income is being set up to fail.

The first point of failure for basic income trials is that they are not a basic income; they don’t test what they purport to. Finland’s ongoing experiment pays people 560 euros per month—the lower bound for renting a one bedroom apartment in the country according to Numbeo is 650 euros. Other trials are similarly miserly. The city of Stockton in California will give people $500 per month, and Scotland is considering giving people “up to” 600 pounds ($825 USD) per month. These amounts are, sadly, often better than the meagre or nonexistent unemployment supports currently in place, but it's not an income if it doesn’t cover rent. In fact, the Ontario trial—despite being more generous with $1,400 monthly payments for single participants—explicitly limits its “basic income” to 25 percent below the national low-income measure.

When was the last time you had a job that told you off the bat that they will pay you exactly enough to keep you under the poverty line? Ontario’s basic income is much better than the current welfare program Ontario Works, which gives its “clients” $347 per month to live on, but by definition it is not a livable income.

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The second point of failure for these studies is that the sample sizes are too small to measure meaningful changes to the social landscape, instead of just individual lives. A really universal basic income might shift the balance of power in society, enabling new forms of labour, cooperation, and kinship. But the current crop of studies probably won’t tell us anything about that—the Finland study includes just 2,000 individuals, and the Ontario pilot has enrolled 4,000 people. Stockton (population: 300,000) will give out its so-called basic income to “a few hundred” people, according to Time. This is not how you test something that’s supposed to have society-wide effects—it’s basically a publicity stunt. I am not even close to being the first person to say this.

Contrast this with Canada’s famous “mincome” experiment in the 1970s. In that experiment, “dispersed samples” of people were given a basic income in Winnipeg and rural Manitoba, but the pilot also included a whole-town experiment in Dauphin, Manitoba. Almost 600 families enrolled in that tiny town, which today has a population of just 8,000 people. The point was to test a "saturation site" that could simulate universal uptake of a basic income and study the community effects. It’s a testament to the foresight of simulating a universal basic income that the outcomes from the Dauphin trial are still discussed and researched today—people didn’t stop working, high school completion rates went up, and recent work by researcher Evelyn Forget concluded that the health of residents even improved.

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Without a similar scope, what will the current crop of pilots give us? Being an optimist, I sincerely do hope that these trials work out and policy is created that gives more money to people who need it, for purely practical reasons. A “basic income” here is just slightly more generous welfare and it will not end capitalism but it will make people’s lives easier. It is undoubtedly pernicious, since it enshrines waged work as a personal and social imperative. But I believe the people who say that going from little or no support to getting a $1,400 monthly cheque in the mail makes a world of difference for them.

More worrying are the politicians licking their chops from the sidelines to swoop in and dismantle existing social supports to make way for a basic income that isn’t. Even while the basic income trial in Finland is ongoing, the centre-right government adopted new rules that say people on welfare have to do specific things like engaging in job training or lose their support. And in Canada, it’s notable that enrolling in a basic income program means getting off disability support; though the basic income trial offers more money to people with disabilities, covering the remaining cost of assistive devices (normally paid by the government’s disability support program) is an out of pocket expense.

Indulging my cynical side, here’s how I see it going in the worst-case scenario for most trials: The trials will end, and the resulting reports will say that recipients reported less stress, a better quality of life, and so on. This was obvious before the trials began, and will change exactly nothing about many lawmakers’ opinions on giving poor people money, which is to say they won’t care. The trials will also be inconclusive about the society- or community-wide effects of a basic income, because they weren’t set up to test that in the first place. Researchers will pore over the collected data for another 40 years, like Dauphin.

In this outcome, the liberal conception of a “basic income” will lose steam and fade away yet again, and the leftist ideal of a universal basic income was never even on the table. But right wing politicians will definitely still like the idea of restricting current social supports, and in my nightmares, that’s all we’ll get when this is done. Transformational change will not come from the middling programs dreamed up by politicians in the centre.

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