Free money: Taking the work out of basic income

Mark Zuckerberg argues the "cushion" of offering a universal basic income would help the next generation of game-changing entrepreneurs...

Working nine to five may still be a standard, often unavoidable way to make a living right now, but in the future?

If you're not tensing up over concerns that Brexit or Trump are going to imminently capsize the world economy – which had only just corrected its course after years in the doldrums – the prospect of robots coming to take your jobs regardless is being reported as a crisis-in-waiting.

The potential positives of that – maybe with technology taking care of everything, we won't actually need to toil away just to avoid becoming destitute? – have undoubtedly seen less of the media spotlight.

According to an increasing number of influential types, however, our constant strive for full employment should already be a thing of the past. 

Given the wealth that exists in the Western world, it's high time that we reboot our attitude about labour and free ourselves from the shackles of having to work just to get by.

That's where the notion of a universal basic income comes in. The idea is simple enough that many will dismiss it offhand as naive and utopian: the state regularly pays its citizens an unconditional sum of money, regardless of their working status, to ensure they can survive and thrive.

But Tesla founder Elon Musk and Facebook co-founder Chris Hughes were just two high-profile corporate names extolling its virtues last year. Politically, the Green Party on both sides of the Irish Sea have pledged to make it a reality (given the opportunity).

Several nations are even putting their money where their mouths are (on a trial basis, natch).

Finland is a case in point, spending two years paying a guaranteed, tax-free €560 per month to 2,000 random unemployed citizens and has already seen positive mental health results. 

Facebook CEO and Harvard dropout Mark Zuckerberg, right, gestures as actor James Earl Jones, left, looks on while seated on stage during Harvard University commencement exercises. (AP Photo/Steven Senne)

This week, Hughes' old Harvard roommate Mark Zuckerberg brought up that bright idea during his commencement speech for their alma mater.

The billionaire touched on the topic when discussing how this generation should redefine equality. He said:

"We should have a society that measures progress not just by economic metrics like GDP, but by how many of us have a role we find meaningful.

"We should explore ideas like universal basic income to give everyone a cushion to try new things. We’re going to change jobs many times, so we need affordable childcare to get to work and healthcare that aren't tied to one company.

"We're all going to make mistakes, so we need a society that focuses less on locking us up or stigmatising us. And as technology keeps changing, we need to focus more on continuous education throughout our lives.

"And yes, giving everyone the freedom to pursue purpose isn't free. People like me should pay for it. Many of you will do well and you should too."

This concept of freedom was central to Finland's thinking when it launched its aforementioned social project.

"The idea here is to give these people this financial security so that they can free their minds and not worry all the time about the money [or] the basic needs," Marjukka Turunen, the head of the legal department in Finland's social insurance agency, told Kera News. "They can now fulfil them with this basic income, because [of] the problem in our unemployment benefit system.

"It’s not worthwhile for you to take on, for example, a part-time job because we have incentives, traps in our social security system that sometimes, when you take on a part-time job, you get less money into your hand than you would if you [get] full unemployment benefits."

"If [we] were to give people $1,500, there would be no incentive at all to go and seek out jobs for many people because you can easily survive with that here in Finland...

"We tried to figure out the amount that would be accurate and enough for these people to seek out jobs but not passivate themselves for staying at home and just not doing anything."

The single payment system also serves to streamline the process and reduce bureaucracy. Turunen explained:

"There was this one woman who said, ‘I was afraid every time the phone would ring, that unemployment services are calling to offer me a job'...

"She said that she cannot take on a job because she’s taking care of her elderly parents at home. This experiment really has an indirect impact, also, on the stress levels and the mental health and so on."

Switzerland got as far as holding a referendum in June 2016 on whether or not to introduce a universal basic income.

Citizens were asked if they wanted to be paid the equivalent of €2,250 every month, regardless of their employment status.

"For centuries this has been considered a utopia, but today it has not only become possible, but indispensable," said Ralph Kundig, one of the lead campaigners.

In the end, 76.9% of Swiss voters were against the plan. Opponents called it a "Marxist dream", while the majority mostly seemed wary of the vague proposals: supporters offered no ideas on funding, suggesting it would be the job of the Swiss government to crunch the numbers if citizens voted 'Yes'. 

Analysts estimated the scheme would cost 25 billion Swiss francs and would have to be funded by austerity cuts and substantial tax increases. There were also concerns from right-wingers that the open-border agreement with the EU would see a mass influx of foreigners looking to take advantage of it.  

Smaller-scale victories have been won elsewhere since then.

In April, the Canadian province of Ontario revealed details of its planned trial. 

The basic income pilot will get underway by the end of the year and will involve 4,000 participants over the course of three years.

Those involved will be guaranteed $16,989 (€11,571) for a single person or $24,027 (€16,365) for a couple - less 50% of their earned income.

Announcing details of the scheme, Ontario premier Kathleen Wynne explained: 

“Everyone should benefit from Ontario’s economic growth. A basic income will support people in our province who are reaching for a better life.

"It gives people the security of knowing they can cover their basic needs and the ability to earn more through work. I believe this pilot is one way that government can be a force for good."

The trial will look at how a basic income impacts a number of areas – such as mental health, use of healthcare, education, and employment participation.

Federatie Nederlandse Vakbeweging, the biggest trade union in The Netherlands, also announced earlier this month that it would "investigate a basic income in the coming period and will start a discussion about it.”

As for Ireland?

As previously noted, the Green Party has long been a proponent of a basic income (as well as a four-day work week).

Social Justice Ireland (SJI) is the other major organisation championing the idea. 

Last November, its Social Policy Conference in Croke Park heard a number of ways the scheme could be realistically implemented and costed, drawing on the efforts of Finland and The Netherlands.

One option put forward would see €150 a week paid to everyone of working age in Ireland, with a top-up of €38 a week for those actively seeking work.

Older residents would receive a higher payment equivalent to the contributory old-age pension.

The system would also include a payment for all children equivalent to the level of child benefit and would be combined with a social solidarity fund to cover special needs.

The working population would also receive the payment - although it would replace tax credits.

The aim would be to eliminate the majority of the current welfare system and finance the income with a flat tax of 40% and a “slight increase” in employer’s PRSI.

Looking to a future where the thought of having to drag yourself to a job you hate seems draconian, SJI director Seán Healy told Newstalk:

"Not just Ireland but other Western societies need to face up to the fact that the world of work has changed very fundamentally.

"An awful lot of the jobs that are available today are not in any sense permanent, long-term... They don't pay very well, a lot of them... Not only that, our unemployment levels are much higher than they used to be.

"What we're suggesting isn't a huge new increase in taxation or whatever, what we're talking about is restructuring ourselves.

"Is it a utopia? I don't think so. I think what it is is a recognition that the world of work is changing and that we as a society should develop our welfare systems and our income distribution systems to be in tune with the world of the 21st century.

The Duke of York being shown around a textiles factory, 1929. Picture by: PA Archive/PA Archive/PA Images

"The 20th century is gone. The expectation was that we would have relatively low unemployment, that people would have jobs, that those jobs would be for life, they'd pay a family wage and that there'd be one job per household for the most part... Now nobody supports any of that, none of that is in place."

If it sounds implausible now, it could well end up proving prescient. 

Additional reporting by Michael Staines