Finland Closes the Book on UBI

An experiment with giving everyone a basic income produces unsurprising results.
Before the experiment was approved by the government in 2016, KELA officials talked of paying 800 euros ($974) a month in unconditional income to a test group of working-age citizens. But by the time the program began early last year, the amount was whittled down to 560 euros: If extended to the whole country, the cost of the earlier proposal would have exceeded the Finnish government’s entire revenue....

It’s all but impossible to live on 560 euros in Finland.
So the proposed solution, of course, is a huge tax increase to cover an even more expensive program.
In a report on the future of work released earlier this month, the World Bank recommended the much more ambitious goal of considering UBI as a means of ensuring a “societal minimum” of welfare in a world of increasingly precarious employment and growing automation. If a society is to accept much higher taxes to pay for a basic income plan, it has to be for a revolutionary outcome, not a mere bump in employment numbers and a dent in the cost of social security administration.
'All the trials failed, so let's really commit to this approach' is not as inspiring as the authors seem to imagine.

2 comments:

E Hines said...

You'd think the management of the World Bank would understand better. Or maybe not.

All a UBI will do is inflate the baseline price level by the amount of the UBI, thereby reducing the buying power of the UBI to the same value as the original zero basic income. To a net detriment of the actual earners, and so the economy as a whole that's "paying" for the UBI, by removing their money from them in the form of the taxes to pay the UBI, the loss of their own buying power, and in the form of lost productivity through a host of pathways.

Eric Hines

Assistant Village Idiot said...

'All the trials failed, so let's really commit to this approach' is not as inspiring as the authors seem to imagine.

It seems to inspire the owners of sports teams every year.