An Introduction to Basic Income

The idea of basic income was the concept that sparked the motivation to start this blog. If you are new to the idea, allow me to give a very simplistic overview.

Basic income (also referred to as basic income guarantee, unconditional basic income, universal demogrant and basic living stipend) is a welfare program in which every citizen is given a regular sum of money with no obligation to seek employment. The amount given is enough to meet basic living needs and would be sufficient not just to survive, but to put you above the poverty line.

If a citizen does decide to work, the basic income amount is independent and wouldn’t be affected by any other sources of income.

The idea is certainly not new. As early as the 18th century the idea a social insurance was being penned by Marquis de Condorcet, a French mathematician, philosopher and political scientist. Whilst in prison for his part in the French Revolution, he wrote Esquisse d’un tableau historique des progrès de l’esprit humain in which he outlined his vision of a social insurance that would be paid to children, so that generation would be free from inequality, poverty and insecurity.

In the UK, the social movement for basic income gained momentum at the end of World War 1. After 4 years and 3 months at war, battle weary Brits were demanding change.

In 1918, Dennis Milner released a pamphlet entitled Scheme for a State Bonus. After serving in the Great War in the Ambulance Unit, he took up employment at the Rowntree’s chocolate factory in York. His interest in politics and especially social and welfare reforms grew to such an extent that he left Rowntree to work on his proposals full time.

His idea, which was written jointly with his wife, argued for the “introduction of an income paid unconditionally on a weekly basis to all citizens of the United Kingdom”. The pair claimed it was an ethical and moral right that everyone should have the means subsistence and this right should not be determined by an individual’s willingness to work.

At around the same time Clifford H. Douglas was also agitating for social change. Douglas was vocal in his belief that modern manufacturing was in violation of Ricardian economics.

Ricardian economics is a theory developed by English political economist David Ricardo. In his theories, Ricardo introduced the idea of comparative advantage which is the principle that under free trade an agent will produce more of and consume less of a good for which they have a comparative advantage. Douglas realised this model wasn’t working as employees couldn’t afford to purchase the goods they were making, despite a boom in British manufacturing. As a solution he proposed a “social credit”. This would include elements of a guaranteed basic income coupled with monetary reform.

The idea of basic income is certainly an interesting proposition. Main opposition for the idea centres on the fear that basic income discourages citizens to work, stifling growth. One example that does seem to suggest this notion is the scheme in operation in Alaska.

Since 1982, Alaska has paid all residence a share of the country’s oil revenue. In 2005 this amount was $2,072. Alaska has the United States highest rate of unemployment at 7.3% compared to the American average of 4.1%, could this just be a coincidence?

If you were given the chance would you introduce basic income? Do you feel this would reduce pressure on day to day life or would this just encourage laziness? Stay tuned for more articles soon.