Money for nothing: has the time come for universal basic income? The Conversation

Extract from an article by Mark Smith

“Money for nothing” is not just a song from 1985 by Dire Straits but also, it seems, a new wave of policies supporting the government providing an income for citizens, regardless of their economic activity.

Benoît Hamon, the surprise winner of the first round of the socialist primaries in France, is the latest high-profile supporter of the idea. But across the world, experiments in universal basic income are already exploring the option of paying individuals a flat rate of income, unaffected by their participation in the labour market. It sounds counter-intuitive.

The first expectation may be that recipients would just stay at home and watch daytime television. But a closer look at how economies have changed over recent decades shows how the case for such policies emerged.

An answer to help the fringe economy

Across many advanced economies, expectations of rising wages, security and prosperity enjoyed by earlier generations have been eroded. Many people now live on the fringes of the economy, only intermittently paid, thanks to zero-hour contracts, unemployment or simply low pay. Small incomes have negative consequences not just for individuals and their families, but for society as a whole.

Proponents of universal basic income, such as Guy Standing, have long talked of the rise of a class known as the precariat, who are most affected by rising levels of insecurity. According to Standing, this calls into question the structure of society, inter-generational solidarity and societal cohesion.

Indeed, societies are increasingly disillusioned with conventional economic thinking. The votes for Brexit and Donald Trump demonstrated the threat of destabilisation of old political and economic orders if too many are left behind.

A partial remedy against such disillusionment could be redistribution that takes modern modes of working into account. This includes the “gig” or sharing economy…(continues)

SOURCE: Mark Smith, “Money for nothing: has the time come for universal basic income?”,  The Conversation, 23 jan 2017

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