I will accept that there are almost certainly edge cases which I can't predict that will need ironing out. probably due to the administration of updating the list appropriately. but basic income seems very much like the proverbial silver bullet that never exists, so I am curious over its negative aspects.
in discussing with friends and family, the worst thing about basic income is it means paying people for doing nothing and that _really_ _really_ angers some people. even worse, it means even millionaires get basic income!
most of the whole host of negative impacts depend heavily on the level that it's set and what other benefits are withdrawn, which there's very little agreement over. Low end BI with aggressive removal of other means tested subsidies generally leaves poor people looking for work much poorer; high end BI is leaves most taxpayers much poorer, whilst potentially seeing , much of the increase to people on low incomes swallowed up in increased rent. But more generally:
- massive distortion of low-end wages, particularly for unpleasant, useful but not particularly revenue-generating jobs such as cleaning. Further outsourcing of manufacturing work for the same reason might be considered a negative aspect by some (especially people with moderate-to high skills related to that manufacturing)
- massive skewing of wage payments away from younger people in many competitive areas of employment, because now that the taxpayer will cover living costs and assuming removal of minimum wages there's absolutely no reason to pay trainees, apprentices (or the likes of runners desperate to make it in television) any non-trivial sum until they've spend a long time "proving their worth".
- regional cost-of-living differences and a guaranteed permanent income encourage former job-seekers to relocate to areas where their prospect of getting a job is minimal. This is further exacerbated if better-targeted housing benefit payments and social housing are removed from the equation.
- depending on the level of BI entitlement children get they're either likely to become a lucrative income source or unaffordable in many areas, especially for single parents.
- a surprising amount of BI revenue will be captured by low-end rents, and other costs that people with more cash to spend at the bottom of the pyramid can't avoid. A surprising amount of BI costs will be funded by the productive
- non-citizens are inevitably going to be heavily penalised (otherwise the country becomes an migrant magnet)
- many advocates use BI as an excuse to push for middle-class squeezing flattening of the tax system, withdrawal of education and health subsidies etc.
- the cost of paying people who would really rather not work almost certainly vastly exceeds the cost of paying wages to people whose job it is to kick people who would really rather not work off benefit programmes. Throw in the fact that people who never had any intention of claiming benefits are now entitled to them.
Like every other reform to the tax or benefit system there are a whole host of winners and losers (including people you probably don't want to be winners like "slum landlords" and the indolent, and people you probably don't want to be losers like the owners of the neighbourhood cleaning firm and hardworking immigrants). It's about as far from the proverbial silver bullet as imaginable: it's reforming existing incentives that have (for better or worse) been tested and debated for decades with a blunt instrument.
I imagine any sensible, practical proposal for basic income would start it relatively low, keeping many current benefits and gradually expand it if it is successful. That seems to be the option Finland proposal will probably take. This will give time to assess the impact and allow corrections/adaptions/cancelling it . No doubt basic income is a blunt instrument, honestly I think that's part of its appeal to me. It seems fair compared to a plethora of well-meaning but convoluted network of social welfare initiatives, that we call a social welfare system.
I will consider you points more carefully.
- obviously a lot depends on the level of basic income. and what is sacrificed for it. I had not considered the politics of people using basic income as an excuse to withdraw education or health subsidies.
- effect on wages can be mitigated in the short term by retaining a (perhaps lower?) minimum wage.
- I agree a lot of basic income will be swallowed in rent. but that will be because that is what is important to people with the money to spend.
- cost-of-living differences will encourage job-seekers to relocate to cheaper areas. this seems like a good thing. if inner city companies can not find the workers it needs, it will either relocate or provide company buses or something. that seems a much better solution than keeping job-seekers where they are.
- non-citizens is a very good point I hadn't considered. But then, non-citizens are penalized by requiring visas etc. plus EU nations will be restricted on what they can do to stop EU citizens claiming.
> massive skewing of wage payments away from younger people in many competitive areas of employment, because now that the taxpayer will cover living costs and assuming removal of minimum wages there's absolutely no reason to pay trainees, apprentices (or the likes of runners desperate to make it in television) any non-trivial sum until they've spend a long time "proving their worth".
That really only applies in industries where people would do the work regardless of pay ("passion" based industries like film). And even then it only makes sense for capital intensive roles (e.g. it wouldn't apply to music, software, painting, comedy, etc).
For most industries, in the face of steady demand (for workers) and a drop in supply (of workers), compensation for trainees, apprentices, etc will increase.
> regional cost-of-living differences and a guaranteed permanent income encourage former job-seekers to relocate to areas where their prospect of getting a job is minimal.
Good. It stops companies from externalising their costs onto the most vulnerable in society.
For example at the moment most companies in my city are located in the middle of town. Companies are happy with this situation only because they can externalise most of the costs.
For example most of the offices in my city are ~1.5 hours travel away from the poorer areas of town. But its where the jobs are. This means a lot of low income wage workers have no choice but to spend ~3hours/day in unpaid travel time. That is hardly fair.
Introduce BI and what happens? Low income earners refuse to donate ~3hours/day unpaid labor to companies. Companies will either compensate the low income earners (great outcome!), move offices closer to the low income earners (great outcome!), decentralise (great outcome!), or be forced into more automation (great outcome!).
> massive distortion of low-end wages, particularly for unpleasant, useful but not particularly revenue-generating jobs such as cleaning.
Actually, what we have now is a distortion of the market. BI would simply cause a market correction.
> a surprising amount of BI revenue will be captured by low-end rents, and other costs that people with more cash to spend at the bottom of the pyramid can't avoid.
Probably not, because like you mentioned above, you actually significantly increase the supply of land and housing available because its no longer tied to jobs.
And if you only doubled the amount of vacant housing you would send the property market into "free-fall" - aka back to affordability.
I will accept that there are almost certainly edge cases which I can't predict that will need ironing out. probably due to the administration of updating the list appropriately. but basic income seems very much like the proverbial silver bullet that never exists, so I am curious over its negative aspects.
in discussing with friends and family, the worst thing about basic income is it means paying people for doing nothing and that _really_ _really_ angers some people. even worse, it means even millionaires get basic income!