Arguments for Universal Basic Income (UBI) are pretty much universal these days — but sadly remain quite basic.
Via The Guardian, here’s the latest from John Harris:
So, a familiar idea has once again returned: that of a universal basic income (or UBI), whereby all of us would be entitled to a regular payment from the state, enough to cover such basics as food and heating.
That, however, is what social security is for — supplemented, in this crisis, by emergency measures like the furlough scheme. Yes, there are problems with the speed and responsiveness of the benefits system, but are we going to get help to people any faster by setting up an entirely new payments architecture (which is what UBI entails)?
Harris is no fool and acknowledges some of the difficulties — not least the eye-watering cost of giving everyone enough free money to get by on. He also acknowledges that if we’re going to provide the whole population with unconditional support, then there are other, perhaps better, ways of doing it (universal basic services, for instance). Ultimately though, he resorts to a cop out — “if we are going to maximise our collective resilience, we should surely consider both.” Head. Desk. (If I still had a desk).
Harris reckons that because of “the government’s munificent response to the current crisis, radical spending plans are surely not the political taboo they once were.” But “munificent” (great word) does not mean limitless. It doesn’t matter how much money is borrowed — or gets magicked up by monetary means — it’s only as useful as the goods and services available to buy with it. With the pandemic still raging, whole swathes of the productive economy that provide that usefulness (whether in the public or private sectors) have shut down. Doing all the things necessary to get them restarted is the over-riding priority. Production is the primary basis of our “collective resilience” — everything else is secondary.
Of course, among those secondary things is ensuring there is sufficient means of consumption. If the latter falls short individually then people slip into poverty; if it falls short in aggregate then productive capacity is left idle.
But UBI is not the answer here either. I’m not going to go into the general arguments for and against the concept (I’ve done that before). I’d just point out that in the midst and aftermath of the Covid-crisis, economic policy is, and will be, in triage mode. Government needs to be able to direct spending power to where it’s needed most — and away from areas where productive capacity is most likely to be overwhelmed. Quite apart from the cost and time required to set up a UBI bureaucracy, its deliberately undirected, per capita distribution of funds is exactly what’s not needed right now.