VIEWPOINT
LIVING FOR A LIVING Is a basic income the silver bullet in the war on poverty? By Adam Lemieux
“Do not waste your time on Social Questions. What is the matter with the poor is Poverty…” - George Bernard Shaw
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ocial science research has gone a long way toward illuminating the complex causes of poverty, and
the nuances of the lived experience. Still, in a society in which the goods and services necessary for survival are primarily obtained through the market economy, poverty is essentially about a lack of money. Following from this, the premise of the “basic income” (also known as guaranteed annual income, or guaranteed minimum income) is straightforward: if poverty is about a lack of money, then the most efficient and effective means of solving poverty is simply to ensure that all citizens have sufficient financial resources. There are various means of achieving these ends. Some argue that such a program should involve a universal cash payment, while others propose a more limited, meanstested version. Some iterations take the form of a “negative income tax,” whereby the benefit is credited against taxable income, and paid out to those earning below a certain amount. But generally speaking, all versions of the concept are aimed at providing every citizen with the ability to afford the necessities of life. The idea has been with us for quite a while, with researchers having traced related philosophies and policy proposals back to the 18th century. There has been a long tradition, especially in Europe, of theoretical research exploring the basic income as a means of alleviating poverty while increasing individual autonomy. In the 1960s and 1970s, as the post-war welfare state began to show signs of being stretched to its limits, American free-market thinkers such as Milton Friedman advanced the idea of guaranteed income as a way to streamline social assistance and limit the power of the bureaucracy. President Richard Nixon was particularly interested, going so far as to commission a study that provided a basic income to 8,500 Americans. But the policy has never gained sustained traction. In the end, it has always been dismissed as utopian dreaming, the effects of which would be incompatible with the values of capitalist democracies. Canada’s Guaranteed Income Supplement for senior citizens, introduced in 1966, is an example of a type of basic income program. For a time, we were also a leader in considering whether such a policy would be appropriate for the broader
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population. Between 1974 and 1979, a guaranteed income was provided to a group of low-income residents of Dauphin, Manitoba, as part of a federal pilot program dubbed “Mincome.” Unfortunately, the project was disbanded when the Conservative government took over, and no final report was released. It was not until the mid-2000s, when University of Manitoba researcher Evelyn Forget tracked down and combed through the data, that the true impact of the program was revealed. The striking evidence from the Mincome experiment has breathed new life into the basic income debate. Contrary to a common fear about guaranteed income programs – that they will incentivize people to give up working – most of the working age population in Dauphin continued to seek and take on paid employment. The only groups that saw their labour force participation decline dramatically were new mothers, who were able to stay home with their babies, and teenagers, who became more likely to graduate from high school. Other data have buoyed the argument that a basic income would address the “social determinants of health.” Poverty is known to put great physical and psychological stress on individuals and families, and to lead people to put themselves in risky situations. In the Mincome trials, the group receiving the guaranteed income experienced significant decreases in hospitalization rates, particularly for issues related to mental health and work-related accidents. This supports the notion that, over the long run, the costs of a basic income program would be at least partially offset by savings in other areas. Ontario leading the way
As we enter 2017, with economies still struggling, social cohesiveness fraying, and existing welfare state programs proving insufficient for the task, the basic income is enjoying a bit of a resurgence. Switzerland recently held a referendum to ask citizens whether they would support a universal basic income. Although only about a quarter of voters were in favour of the idea, the campaign itself was an indication that we are entering an era in which basic income policies can receive genuine consideration. Finland has recently launched an experiment with a modest benefit, with the declared purpose of encouraging people to take on short-term employment. Studies are also underway, or on the way, in the Netherlands, California, India, Kenya, and elsewhere. Ontario will soon become one of two Canadian provinces, along with Prince Edward Island, to study a basic income program. A commitment to implementing a pilot project was included in last year’s budget, and the government later appointed former Conservative senator Hugh Segal, one of