The modern precariat and the Unconditional Basic Income

Written By: - Date published: 2:09 pm, August 2nd, 2015 - 127 comments
Categories: benefits, capitalism, cost of living, Economy, employment, equality, Globalisation, jobs, poverty, socialism, uncategorized, welfare, workers' rights - Tags:

Max Keiser and Stacey Herbert have just done a great episode of the Keiser Report with Dr Guy Standing of the international Basic Income Earth Network.

They cover:
– How a globalised plutocracy has constantly shifted income share to capital and away from labour.
– How a rump ‘Solaria’ of people with good jobs, good pay and good benefits remain (for now).
– How most people are left trying to cope with insecure employment, loss of social protections, and increasing reliance on poorly paid precarious jobs below their level of education, training and experience.
– How technologies like Uber are becoming the new labour brokers and rentiers of labour.
– How one in three jobs will soon be allocated by technological ‘Dutch Auction’ where only the lowest bidder gets the job.
– How well meaning politicians (like Jeremy Corbyn) and long standing organisations like unions, have not updated their toolbox to combat these changes.

The phenomenon of technological job destruction (which dates back to the 1800s) also increases inequality, breaking down society’s ‘income distribution system.’

Critically, Standing describes the difference between ‘work’ and ‘paid jobs’. There is a lot of useful work in families and communities which could be done, but which is not being structured into the form of a ‘paid job.’ A UBI would allow people to focus on getting that kind of work done, not on chasing scarce, poorly paid, badly led, disorganised, ‘paid jobs.’

As he talks we can see how a UBI can completely change the picture to greatly reduce peoples’ reliance on poorly paid precarious jobs. A UBI gives a far greater sense (and reality) of control to ordinary people over their own lives and their relations with others bringing with it many health and social benefits.

In other words, as a principle of justice, a UBI provides security and provides dignity to ordinary people who would otherwise be trapped in a precarious day to day, week to week existence.

edit: Guy Standing was interviewed on RNZ in February (hat tip Katipo) talking about the modern precariat.

127 comments on “The modern precariat and the Unconditional Basic Income ”

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  1. RedLogix 1
    2 August 2015 at 2:34 pm

    Top post CV. This has been a topic close to my heart for a long time.

    Here is my first comment on the topic back in 2008:

    There are a number of very interesting positives that come out of this idea that rather nicely combine many of the advantages of both a progressive AND a flat tax system, while mitigating the disadvantages of both.

    Personally I have long thought that UBI is the potential ‘circuit breaker’ idea that could get NZ politics out of the current stale mode we are in squabbling over taxes versus public services.

    http://thestandard.org.nz/on-flat-tax/#comment-70332

    Or an post I did in 2011:

    http://thestandard.org.nz/universal-income-revisited/

    While it is natural for the left-wing to focus on the social benefits of a UBI – we shouldn’t overlook the economic efficiency of a flat(ish) marginal tax rate. This is something Gareth Morgan has emphasized strongly – the idea of vertical and horizontal equity – that our tax system should treat all people equally, which removes all the distorted incentives our current system is burdened with.

    • Colonial Viper 1.1
      2 August 2015 at 3:51 pm

      🙂

      Also agree that Morgan has some good ideas, although I will say that his system as structured would leave some people at the bottom end considerably worse off than today. In addition, there needs to be an increasing awareness that Government spending funds into existence is just as valid an option as Government choosing to tax in funds to spend. There are plusses and minuses with each.

  2. Stuart Munro 2
    2 August 2015 at 3:04 pm

    Although the UBI addresses many social justice and fiscal issues I don’t think any NZ party is quite ready to embrace one yet, and in the short term I wonder if a transitional form or prototype for it might not be a better aim.

    I want the restoration of the social safety net that the Gnats have torn great holes in, but I also want greater social participation to combat the decline that Putnam describes. One of the great features of the NZ I grew up in was that we didn’t have to lock our doors, and though I doubt we can return to that overnight, the principal that we help each other was part of what once gave us an extraordinarily effective an uncorrupted civil service.

    Having spent some time out of work over the years too, I recognise that the lack of regular participation isn’t especially helpful to people, and structurally encouraging it makes sense. But not being a vicious and unprincipled baggage like Bennett, I’d prefer to wield a carrot than a stick, and I think many Winz folk are also uncomfortable with the dysfunctional pressure they are being obliged to apply.

    There is no benefit to an economy in generating hundreds or thousands of applicants for jobs – efficiency and productivity lie in maximising participation. A move toward self-employment and artisan lifestyles has the potential to provide some relief, but the current Winz emphasis is pernicious and dishonestly represents unemployment as being much lower than it is. Real underemployment numbers based on working age population are in the order of 40% – Treasury are simply distorting figures until they are effectively lies.

    • Colonial Viper 2.1
      2 August 2015 at 3:56 pm

      Although the UBI addresses many social justice and fiscal issues I don’t think any NZ party is quite ready to embrace one yet, and in the short term I wonder if a transitional form or prototype for it might not be a better aim.

      Important points to ponder. I would say that the Left risks making a big mistake by limiting its perspective to what its elected Parliamentarians can cope with considering. Politicians are followers not leaders, and they need considerable poking and prodding along.

      In terms of a transitional prototype, something like 80% of NZ Super available from 50 through to 64 years of age inclusive, could be the go.

      • Lanthanide 2.1.1
        2 August 2015 at 4:34 pm

        Yip, I’m sure the baby boomers would be right behind voting for that.

        Then expect the next National government to steadily raise the entitlement age, just as their backers would want.

        • Colonial Viper 2.1.1.1
          2 August 2015 at 4:36 pm

          enlightened self interest heh

          • Lanthanide 2.1.1.1.1
            2 August 2015 at 4:42 pm

            The baby boomers are of course the segment of society least in need of a UBI.

            • Colonial Viper 2.1.1.1.1.1
              2 August 2015 at 6:18 pm

              On average, agree, but there are still plenty in the 60+ age group today who are living on the edge now, after having lost their businesses or their livelihoods or their marriages in the 1990s or 2000s.

              Having a solid UBI (NZ super) is helpful of course.

              • Lanthanide …
                2 August 2015 at 6:21 pm

                Yeah, but while a UBI for 50-64 might be politically easy to get across the line, it is a sad indictment of what is really needed.

                Better to do the full measure, or if you really can’t make it universal, spend the money where it is needed most – those in the 16-35 range. You know, the people paying taxes that are spent on super now, but whom almost certainly won’t be able to share in such a lucrative system when they reach 65.

    • Draco T Bastard 2.2
      2 August 2015 at 4:05 pm

      Although the UBI addresses many social justice and fiscal issues I don’t think any NZ party is quite ready to embrace one yet, and in the short term I wonder if a transitional form or prototype for it might not be a better aim.

      Andrew Little brought it up shortly after he became leader of Labour. The Greens have it as a policy and so do The Alliance.

      Having spent some time out of work over the years too, I recognise that the lack of regular participation isn’t especially helpful to people, and structurally encouraging it makes sense.

      Did you watch the video where the guy being interviewed told us that people who got a UBI engaged more and were more productive?

      • Stuart Munro 2.2.1
        2 August 2015 at 5:08 pm

        No – but I’m aware that disengagement is not unrelated to financial embarrassment. There are few people indeed who cannot meaningfully contribute to our commonwealth if they have enough room to breathe.

    • Ian 2.3
      2 August 2015 at 10:47 pm

      UBI is topic of discussion with Iain Less-Galloway at his regular ‘Coffee & Politics’ in Palmerston North this Monday evening

      • rhinocrates 2.3.1
        3 August 2015 at 12:02 pm

        He should take Robertson’s place on the front bench. He knows why he’s in Labour.

  3. rhinocrates 3
    2 August 2015 at 3:19 pm

    A topic close to my heart too, and a very welcome post.

  4. rhinocrates 4
    2 August 2015 at 3:25 pm

    On the subject of lowest bidders, astronaut John Glenn had this to say:

    “I guess the question I’m asked the most often is: “When you were sitting in that capsule listening to the count-down, how did you feel?” Well, the answer to that one is easy. I felt exactly how you would feel if you were getting ready to launch and knew you were sitting on top of two million parts — all built by the lowest bidder on a government contract.”

    • Colonial Viper 4.1
      2 August 2015 at 3:56 pm

      And then imagine constructing a whole society like this…

      • Draco T Bastard 4.1.1
        2 August 2015 at 4:08 pm

        Don’t need to imagine – just need to look around. The results, as we can see, just aren’t that great.

        • Colonial Viper 4.1.1.1
          2 August 2015 at 4:14 pm

          It is starting to really grate, truth be told…and I’m someone damn lucky enough not to be in the bottom quartile of NZers economically…by definition over a million Kiwis are.

          • Jones 4.1.1.1.1
            3 August 2015 at 8:26 am

            I sometimes assist with bidding processes and despite the rhetoric that “value for money” is much more than cost, very rarely have I seen it go beyond that upon consideration. Very frustrating.

            • RedLogix 4.1.1.1.1.1
              3 August 2015 at 8:38 am

              Been on both sides of this game Jones. Lowest price is always the most expensive.

              Sadly most managers are either too stupid, too scared or too full of themselves to know otherwise.

              • One Anonymous Bloke …
                3 August 2015 at 8:55 am

                “Lowest price is always the most expensive”

                ^this

                • rhinocrates …
                  3 August 2015 at 11:59 am

                  It’s the Samuel Vimes Boots Theory of Poverty: If you’re wealthy, you can afford a good pair of boots that last forever, but if you’re poor, you can only buy a cheap pair that wear out quickly and have to be repeatedly replaced. As a result, the person who can spend more on a pair of boots spends less in the long run, while the poor person spends more and is kept poor.

      • freedom 4.1.2
        2 August 2015 at 6:01 pm

        +1

    • freedom 4.2
      2 August 2015 at 6:00 pm

      Difference being rhinocrates the lowest bidders on the moon shot had a unique and spectacular motivation to do a good job.
      A motivation noticeably absent in far too many corners of today. The manufacturers, and the consumers, betray themselves all too easily.

      I don’t imagine Reaching For The Stars is festooned on the bosses’ walls of most corporate hq’s
      Screw’ em! They’ll buy the crap we make! is a more likely contender.
      Fast food, bulk retailing, throw away tech and wash’n’ wear values. Every unit carefully integrated into engineered obsolescence.

      A disposable humanity where we wonder, is the same slop to be welcomed when our building and infrastructure development, our healthcare, our education, even our social services are to be shifted into the same lowest bidder mindset? Oh that’s right, too late.

      • marty mars 4.2.1
        2 August 2015 at 6:32 pm

        + 1 Good comment

      • rhinocrates 4.2.2
        3 August 2015 at 12:00 pm

        “Difference being rhinocrates the lowest bidders on the moon shot had a unique and spectacular motivation to do a good job.”

        Indeed – an ethos or goal, or even the concept of having an ethos is lacking today.

  5. Exile 5
    2 August 2015 at 3:29 pm

    Well meaning politicians like Jeremy Corburn?
    Seriously, well meaning, the man who reckons that Islamic courts are acceptable in Britian, who actively tries to blockade israel a democracy and instead support the hamas led Gaza republic?
    A man who support the present Venezuelan republic (who has virtually bankrupted the country) and who is in favour of re-nationalising industry.

    Hmm, to me people like him needs to be locked up and kept where they belong, in the communist parties and not trying to establish their ideas and ideals into the socialdemocratic movements that Labour belong to. these people are dangerous and can split our parties. The communist movement tried and failed and we shall never go back there.
    I visited Eastern Europe in 1992. It left an impression on me that ill never forget, people who share the views of such leaders are not supporters of the working men and women that populates the labour movements.

    When even Bob Crow, the most feisty trade unionist that Britian has seen post Thatcher, is scared of a candidate you sure know that the man is beyond repair.

    • Colonial Viper 5.1
      2 August 2015 at 3:59 pm

      The only reason that Jeremy Corbyn sounds like an extremist to your ears, is that you have grown used to corporate capitalists like Tony Blair pretending that they are what Labour stands for.

      UK Labour would be very lucky to have Corbyn shake them up and remind them that they were founded as a DEMOCRATIC SOCIALIST party, not as a left-of-tory placeholder for the corporates and the ruling class.

    • half crown 5.2
      2 August 2015 at 7:44 pm

      ” who is in favour of re-nationalising industry”

      Comrade What a fucking good idea,

  6. ianmac 6
    2 August 2015 at 3:29 pm

    Thanks CV. It will be great when not only Mr Little and Mr Morgan take a serious look at the UBI. The unattainable Utopia might become the attainable Utopia. Hoping.

    • RedLogix 6.1
      2 August 2015 at 3:39 pm

      What has changed in the 7 years since I made my first modest post in 2008 (and of course there are a great many others who’ve worked very hard on the idea for MUCH longer than that) – is the receptivity to it has changed substantially.

      And I first formulated the idea for myself, in a very primitive form, back about 2001. But until recently anyone I mentioned it to was either scathing or labelled it ‘idealistic’. Indeed you have to be of a certain age to recall Muldoon’s sneering mockery of Social Credit’s similar ideas as ‘funny money’.

      That’s changed in just the past few years. I think it will happen now – and a lot sooner than I ever dared hope.

      • ianmac 6.1.1
        2 August 2015 at 4:07 pm

        Since this would be a major shift in thinking and that those with the most already and therefore most able to block discussions, then it would take years to filter through from an idea to a reality. But one of the forces which will push it forward would be that technology will wipe out many of today’s jobs. Fear of losing jobs and being unemployed will be powerful.
        Change in society takes time to accept. Unless traumatic events force change.

        • Colonial Viper 6.1.1.1
          2 August 2015 at 4:17 pm

          Given that a UBI for Kiwis 60 and over was implemented many many decades ago, hopefully it will not be too much of a stretch to envision something a bit more now.

          • ianmac 6.1.1.1.1
            2 August 2015 at 5:08 pm

            I think Morgan said that Kiwis over 65 on Super would be the biggest losers in UBI, as they would only get that basic income which would be much less than current Super. So I guess they would be a hurdle. (Me for instance.) 🙂

            • weka 6.1.1.1.1.1
              2 August 2015 at 6:26 pm

              Depends on how the UBI is done. From memory Morgan’s UBI rate is pretty low. Others calculate it differently.

              • Colonial Viper …
                2 August 2015 at 6:30 pm

                Yep. We’ve got to get over the meme that a UBI is not affordable. This country has enough physical resources to support every body within it to a basic level of dignity and independence. Accepting that, finding the money required – whether it is form income redistribution or from the issuing of new money – becomes a purely political matter of preference.

                • weka …
                  2 August 2015 at 8:09 pm

                  This is very true, but I’m not sure how feasible it is to get the country on board with that. A UBI is one sell, a UBI at a decent rate by transforming how we do economics is another. Both are worthy of our effort of course, but perhaps there is a pragmatic issue here, would we go for a lesser UBI in the meantime, or is that counter productive?

                • Draco T Bastard …
                  2 August 2015 at 8:40 pm

                  The declaration by people that we can’t afford a UBI is a declaration that we can’t support our present population. From this we can determine that the people making such claims are either:

                  1. Totally ignorant and thus shouldn’t be listened to or
                  2. Psychopaths that want to keep all the countries wealth to themselves and thus shouldn’t be listened to

              • RedLogix …
                2 August 2015 at 6:38 pm

                I think we’ve had this discussion a while back; the base UBI would likely be pretty low. But for the elderly or disabled this could be topped up with residual target benefits.

                And of course the big thing is that you don’t get caught in the very high marginal tax rates most people with a benefit presently experience. This means it becomes a lot more attractive to do those casual, part-time or informal sorts of jobs.

                • weka …
                  2 August 2015 at 8:11 pm

                  Doesn’t a high rate get taken back for people on higher incomes via tax? ie a high rate doesn’t mean everyone gets that in their pocket.

                  The topup one is pretty thorny, because we already have a culture that supports the bludger meme. Would be good to see some discussion around this at some point rather than it being treated as a side issue. It’s core to a UBI working.

                  • RedLogix …
                    2 August 2015 at 10:17 pm

                    The present system has this built in poverty trap; that for every dollar a beneficiary does earn – their benefit is rebated substantially.

                    If you include things like stand-down periods, the myriad complications dealing with WINZ, and all the costs associated with working – and the crappy low wages a lot of jobs pay – means that there isn’t all that much nett difference between working and not working. That effectively amounts to a very high marginal tax rate on the earnings.

                    A pure UBI replaces all this with one fixed basic income and a flat marginal tax rate. Effectively the paper-boy and the billionaire pay exactly the same tax rate on each dollar of their income. Usually around 30-35%. (Gareth Morgan’s version also sees the billionaire pay other taxes on land, capital gain and financial transactions.)

                    Under the current system for instance, if your income on a benefit was say $600pw, and then your nett income in a job is say $800pw, then in reality you are only $200pw better off. In this example it amounts to a marginal tax rate of 75% on the income from your job. If you include other costs it can easily be higher.

                    In reality I agree with you. It’s may be best if we didn’t try and leap from the current system to a UBI all in one go. There any number of ways to make the transition.

                    On the other hand – there have been some pretty decent trials of a UBI already undertaken and I’d guess it’s worth reading up on them to see what issues they encountered.

                    • weka …
                      2 August 2015 at 11:01 pm

                      Thanks, I already understand most of that (you’re teaching your grandmother to suck eggs on the benefit issues).

                      I was asking if given the real terms tax rate is higher for higher income people (which is part of how the UBI is paid for) why does the UBI have to be set low?

                    • RedLogix …
                      3 August 2015 at 7:12 am

                      I was asking if given the real terms tax rate is higher for higher income people (which is part of how the UBI is paid for) why does the UBI have to be set low?

                      Sorry – I misread your question.

                      (Incidentally my original passion for the UBI arose directly out of consideration for people on a benefit … all the other advantages were things that I discovered later.)

                      The challenge just lies in the numbers. Say NZ has an adult population of 3m. Each one receives $10k pa – this amounts to a total ‘cost’ of around $30b pa.

                      If the total adult workforce participation rate is around 70% and the average income is $50k pa then total wages income is about $105b. If this total income was taxed at a flat PAYE rate of 30% ($31.5b) this would nicely balance the total cost of the UBI.

                      Of course a UBI of $10k pa is still pretty miserable, but if you increase it, you have to either raise your flate PAYE rate or find the money elsewhere.

                      And this is before we’ve paid for any of the other expenses of govt, like education, health and development. Gareth Morgan covers these off with GST, CGT and a FTT among other things. But however you cut it, a UBI of much more than $10kpa is very hard to fund conventionally.

                      These days I tend to agree with CV – simple, standard QE (ie getting the RB to print the difference) is probably the most sensible way of going about it. Of course the banks would hate this as it undermines their exceedingly profitable little monopoly on money printing.

                    • Nic the NZer …
                      4 August 2015 at 7:39 am

                      Comparing UBI with a Job Guarantee I think there are some obvious issues with the UBI.

                      1) The UBI rate has to be quite low for various reasons (one being 3 below).
                      2) The UBI still leaves intact the system of managing inflation using unemployment (your still going to have mass unemployment, and people are still going to falsely believe their jobs are being taken by technology or shipped overseas).
                      3) It has an inflation bias if the economy actually reaches full employment levels of capacity utilization (though that is unlikely in the current political environment). The inflationary bias is there because its pay without work, so no extra output is produced by the economy.
                      4) It will at best have a minimal impact on increasing the voluntary sector (maybe as much as bringing beneficiaries up to retired levels of voluntary work, but clearly not at the rates being proposed, and probably no higher).
                      5) You will still have unemployed persons, and the UBI does little to help them develop a job history or work skills. Many unemployed persons would rather work for an income than collect a benefit, just because work provides a sense of engagement with society.

            • RedLogix 6.1.1.1.1.2
              2 August 2015 at 6:27 pm

              True .. but the UBI does not rule out other superannuation provision like they do here in Australia.

        • Andrea 6.1.1.2
          2 August 2015 at 10:02 pm

          “then it would take years to filter through from an idea to a reality”

          Perhaps not.

          How long was it for the uptake of home PCs, mobile phones, pocket calculators, smoking bans, seat belts, helmets for cyclists? All the politically correct ideas we now take for granted – women wearing trousers to work, woman as prime ministers and high court judges, paid parental leave.

          And the insidious drivel that is the neo-liberal religion. Didn’t take ‘long’.

          If we can keep that pernicious word ‘deserving’ out of the conversation it may have a chance…

  7. half crown 7
    2 August 2015 at 3:37 pm

    I think attitudes have got to change first from what we have now.

    Spiv good citizen, deserves a knighthood after years of tax avoidance.
    Lower class, 3 jobs to survive, trash deserves ridicule and/or abuse.

    I cannot see that happening, Can you honestly see the .001% giving up anything? and they have all the money and power. Things are being spudded into place to keep that so. Very concerned that the police are now armed with Tasers. What is the truth, behind that, is it a measure for future demonstration control?

    The book The Precariat The New Dangerous Class by Guy Standing is well worth a read.

    • RedLogix 7.1
      2 August 2015 at 3:42 pm

      That’s a damn valid question hc.

      But then again it always useful to recall that there is a lot more of us than there are of them. The Berlin Wall was impregnable until the day people stopped believing in it.

      • Colonial Viper 7.1.1
        2 August 2015 at 4:03 pm

        And especially when the East German soldiers guarding the Berlin Wall stopped following the orders of the elite and put their weapons down.

      • old school 7.1.2
        3 August 2015 at 3:13 pm

        So the farm fence and its control has to be questioned for its dynamic of our cultures compliance and its dominant control of right.

    • Skinny 7.2
      2 August 2015 at 4:22 pm

      Another great topic posted by CV.

      ” Very concerned that the police are now armed with Tasers. What is the truth, behind that, is it a measure for future demonstration control?”

      Yes it is no coincidence the wholesale taser implementation for our police comes out with the US and our Government expecting the sign off on the TPPA, and the strong possibility of civil unrest. I got quite an insightful briefing from an American friend who has moved here from Hawaii with his Kiwi partner. He was saying the US military had been running crowd control workshops with it’s 5 eyes partners. So the New Zealand fuzz have been tooled up with the latest technology and techniques in dealing with mass protests of the people. Suffice to say the old motorcycle helmut and make shift wooden shield wouldn’t be much chop against the latest arsenal the cops have at their disposal courtesy of Uncle Sam.

      Very scary Big Brother stuff indeed.

      • Colonial Viper 7.2.1
        2 August 2015 at 4:31 pm

        As I mentioned in the post on tasers, 5,700 NZ police are scheduled to be trained in the use of the M4 assault carbine, and they are trialling pepper spray 6x stronger than that originally approved for use for the NZ Police.

        Something is very wrong.

        Reminds me of reports that the US Ferguson police dept had received riot control training – in Israel.

        IMO the US is leading its FVEY partners into establishing all the elements required for a turn key security and surveillance state.

      • Colonial Viper 7.2.2
        2 August 2015 at 4:34 pm

        This is the M4 carbine. Ordinary NZ Police have access to a civilianised semi-automatic version, but with the ability to attach all the various scopes and add-ons.

        http://www.military.com/equipment/m4-carbine

    • Draco T Bastard 7.3
      2 August 2015 at 4:25 pm

      Can you honestly see the .001% giving up anything?

      Not willingly but then we’ve forced them to before. The choice is theirs really: Do they give up the privileges that they have willingly or do we take them from their cold, dead hands?

      Very concerned that the police are now armed with Tasers. What is the truth, behind that, is it a measure for future demonstration control?

      That is a very good question but all revolutions have started with the ‘authorities’ being better armed than the revolutionaries.

      • Colonial Viper 7.3.1
        2 August 2015 at 4:28 pm

        Do they give up the privileges that they have willingly or do we take them from their cold, dead hands?

        The uber elite really need to study a bit more history. Even studying only recent western history of the last 500 years should give them a pretty good idea of where they are heading now.

        • Stuart Munro 7.3.1.1
          2 August 2015 at 5:04 pm

          They cannot imagine it. Then they will think they can resist it. Then they will try to outrun it. Then they will pretend to support it – just as they did with the decent society.

          • ianmac 7.3.1.1.1
            2 August 2015 at 7:29 pm

            And there would be huge savings on Welfare agencies being no longer required. The savings would be chanelled into UBI.

            • maui 7.3.1.1.1.1
              2 August 2015 at 11:53 pm

              $2 billion according to the Gareth Morgan video, by scrapping WINZ and the massive changes to the IRD I would guess.

              • Colonial Viper …
                3 August 2015 at 11:33 am

                And remember, money paid out in a UBI doesn’t “disappear” from the economy. Over a short period of time, the government will get much of it back in terms of GST, company tax and income tax.

                You can’t collect in tickets at the gate if you haven’t given the tickets out to the punters first!

                • Draco T Bastard …
                  3 August 2015 at 12:37 pm

                  We nee to start the meme that money comes from the government and returns to the government.

                  Of course, that does require that we stop the banks creating money.

                  • Stuart Munro …
                    3 August 2015 at 1:03 pm

                    Yes. In Korea the government follows what happens to money closely, and tax evasion is not readily achieved. Private citizens can get a small rebate by submitting transaction evidence, which helps tax authorities to understand how the economy is working and what the consequences of various interventions would be – none of the ‘oh shit it isn’t working’ stuff, or knee-jerk gst hikes that have characterised Bill English’s misrule.

              • Tricledrown …
                3 August 2015 at 4:54 pm

                The saving of Winz costs of $2 billion ,
                Still means we would have to find $ 20billion dollars to fund the UBI it would mean you would have to increase GST +taxes .
                It’s not going to happen while 2/3 of New Zealanders see themselves as well off.

                • maui …
                  3 August 2015 at 5:25 pm

                  These are numbers from the Gareth Morgan vid.

                  Universal Basic Income of $11,000 for everyone over 21 years old.

                  UBI total cost for the country = -$36 billion
                  Existing WINZ benefits no longer required = +$21 billion
                  WINZ & IRD bureacracy no longer required = +$2 billion
                  New land & housing tax = +$8 billion
                  New flat tax (30%) on everything = +$5 billion

                  TOTAL COST = $0

                  • weka …
                    3 August 2015 at 5:32 pm

                    is that last one meant to be income tax (30%)?

                  • Colonial Viper …
                    3 August 2015 at 5:34 pm

                    Thanks for detailing the break down.

                    I think the UBI is a tad low – it should be more like $12K or $12.5K pa, tax free.

                    The property tax is a progressive idea.

                    I don’t think you would be able to cut out all existing WINZ benefits payments, although you would be able to cut out most of them.

                    Everything else being equal, the Government is currently under-spending into the NZ economy which makes it very difficult for ordinary people and ordinary companies to generate sufficient income and savings. It would do NZ a world of good to get monies which were equivalent to an extra 1% of GDP spent into the economy by the Govt, even if it is to partly offset the $15B or so taken offshore by foreign companies.

                    • Draco T Bastard …
                      3 August 2015 at 6:38 pm

                      I think the UBI is a tad low – it should be more like $12K or $12.5K pa, tax free.

                      That’s not enough to live on. Personally, I think it should be up around the $20k mark. Enough to live on and to be entrepreneurial.

                    • Colonial Viper …
                      3 August 2015 at 6:59 pm

                      I can see a rationale for why it could be set at much higher than $12.5K pa, however at $20K pa it starts interfering with many other parts of the money economy in a serious way e.g. $20K pa is more than you would earn doing a 3 day a week job on the minimum wage.

                      Also at $12.5K pa you encourage people to really work together to make their UBI’s benefit each other collectively.

                    • weka …
                      3 August 2015 at 7:05 pm

                      it looks like two different scenarios. One is a sub-liveable rate, where presumably people either top up from wages or govt allowances. The other is a higher rate that is liveable, but most people are probably still going to prefer a higher income so would choose work (or where needed allowances).

                      Is the main rationale for the first one affordability? Or are there concerns about inflation and business viability as well?

                      I tend to agree with Draco, make it a generous rate that encourages creativity and entrepeneurial activity (along with non-financial support for those things). But I don’t know what the downsides are. Anyone?

                    • Colonial Viper …
                      3 August 2015 at 7:11 pm

                      I’d like to see a UBI set at a level which gives people significant freedom from paid employment and to choose/design other ways of life whilst not causing too high a level of disruption to employers and businesses.

                    • weka …
                      3 August 2015 at 7:17 pm

                      Presumably there is a bunch of work that is only being done because people need an income. With a UBI, the only way those jobs will still exist if is the wages are higher, is that right? (because with the UBI there is a surplus of jobs rather than a surplus of labour). Which puts some businesses and workplaces at risk of failing. What would be the economic and social impact of that?

                    • Colonial Viper …
                      3 August 2015 at 7:25 pm

                      And it’s not just that wages are too low in some jobs, but very many jobs are badly designed, badly led, and put no thought whatsoever into giving the worker any sense of satisfaction or accomplishment.

                      People might actually enjoy going to work if companies and managers put some effort into the old fashioned concept of “job design.”

                    • weka …
                      3 August 2015 at 7:48 pm

                      so we might see a general improvement in work conditions/wages as well as businesses/employers becoming more skilled in how to create desirable jobs, but some businesses/work places would presumably fold in the process.

                    • RedLogix …
                      3 August 2015 at 8:01 pm

                      A very interesting discussion here. I’ve always tended towards a UBI of around $10k – which I accept is pretty low.

                      Mainly because the numbers more or less fit into a conventional fiscal framework without too much stress. Overall most people would actually be in about the same nett tax position.

                      But there is a good case for making it higher – and using this as an opportunity to re-think the role of money, debt and banking in the whole economy. I guess my thinking always allowed for a fair bit of political flexibility around the UBI and Tax Rate settings.

                  • Tricledrown …
                    3 August 2015 at 5:40 pm

                    So has any party taken this policy on board.
                    It sounds good every policy has side effects .
                    The flat tax of 30% does that include Gst.

        • half crown 7.3.1.2
          2 August 2015 at 7:35 pm

          “The uber elite really need to study a bit more history. Even studying only recent western history of the last 500 years should give them a pretty good idea of where they are heading now.”

          Damm right Colonial. I said earlier attitudes have got to change
          The first place is the Universities. Steve Keen the Australian economist said when he was a lecturer it was frowned on teaching an alternative point of view to the Neo’s “Debunking Economics by Steve Keen.”

          There has to be a culling out of this dogma that has now become some form of a religions cult in our Universities. Also economic students need to be taught history, not the 1066 type of crap but the economic causes of the likes of the French and Russian revolutions.
          To me it is scary, If a revolution happens. All of us will be victims. That is something the Neo’s cannot seem to get in to their heads.

  9. Stuart Munro 9
    2 August 2015 at 5:22 pm

    The third branch I want to social policy is lifelong (and ideally free) education – so that income security, participation, and education form almost equal features of our culture. Cloud and community provision should enable economical asymmetric delivery and supervised practice or peer tuition.

    • Colonial Viper 9.1
      2 August 2015 at 6:09 pm

      yes – and where people can both be students and tutors, sharing their accumulated knowledge and experience.

      • Stuart Munro 9.1.1
        2 August 2015 at 10:28 pm

        There’s a thing called the 2 sigma effect – peer tutored students lift performance by two standard deviations. But the clincher is that the tutor’s performances are also lifted appreciably. So a mass social tutoring program is a game changer.

        What would become of a society that lifted educational outcomes by even one standard deviation? And the oh-so-expensive tail could be crossing from the red side of the ledger to the black. A neo-con argument – lives would be improved.

        • RedLogix 9.1.1.1
          2 August 2015 at 10:31 pm

          Yes – we used to have these things. They were called WEA, Workers Education Associations.

          They were doing quite ok until the Nats defunded them in 1991.

          http://www.wea.org.nz/

          • Stuart Munro 9.1.1.1.1
            3 August 2015 at 12:13 am

            Not quite – though they were constructive. The community ESOL tutors were probably closer, or ARAS. But way too small in scale – to get the full societal effect you’d need substantial coverage – two thirds or so. The U3A is probably the closest to it – but teaching only one end of the age curve (Japan does that too – there is some transfer nevertheless).

            Suppose there were student volunteer armies in non-earthquake cities organised for this – you’d get a big uptick in educational outcomes – and enhanced community participation. Which you’d need if you mean to build a proper 21st century enlightened society…

            • Molly 9.1.1.1.1.1
              3 August 2015 at 9:04 am

              Enjoying this discussion.

              I’m interested in the opportunities for a collective education system. Particularly for our high-school aged students and as an affordable and more responsive alternative to tertiary education. The wheels of change move slowly in higher levels of education, and when politicians finally reach a consensus view on the required needs of the population, the education system will still take a while to catch up. (I remember reading once, that educational shifts take about 12 years to be entrenched).

              Due to the economic situation in Spain, a few collectives have started up, with people sharing knowledge and working together to educate themselves and others. Another Life is Possible, shows a couple of examples (around 24 minutes in)

              The hackschooling approach or Uncollege are also alternatives, results are much enhanced by face-to-face participation and interaction, which bodes well for collective local groups to get together using an already provided framework.

              Many colleges and universities, including Auckland University have got together to create online programmes on futurelearn or edX.

              • Stuart Munro …
                3 August 2015 at 7:00 pm

                The another life is possible link is good – & I’ve been doing futurelearn for awhile.

                But these don’t exactly exhaust the learning options.
                The green guerrilla and foodwall movements in the states are an antidote to food poverty and neglected urban space like the Christchurch redzone. Voltaire’s prescription for poverty idleness & vice.

                Apprenticeships and internships are one form of experiential learning that meet the intention – but so do the kind of working bees that once built or maintained our community halls – or learning from a home builder or quilting group.

                A workshop on prestressed concrete shell structures or grown buildings(a la Nervi or Hundertwasser) is an obvious community built solution to Christchurch’s cathedral bombsite. (We might even see Dutton’s spandrels :D)

                The kind of pinus planting that helped us out of the last depression would be appropriate in many areas – hopefully with better ecological species selections.

                But in many areas there is capital induced paralysis – people not reacting to/improving their circumstances or obstructions like Gerry Brownlee preventing them from doing so. This is such a waste.

                • Colonial Viper …
                  3 August 2015 at 7:03 pm

                  They are afraid of what people could be, and could come up with, if they weren’t subject to control mechanisms like being starved of financial capital.

                  • Stuart Munro …
                    3 August 2015 at 9:03 pm

                    They should be afraid – we are the species that built pyramids and castles – extinguished the mammoth and the European lion – put down the absolute monarchs and facist industrialists, built a truly decent society from Europe’s second siblings and local warriors without descending into barbarism.

                    These pissant crooks aren’t up to keeping us ‘in line’ much less leading us into the future – any future – certainly not their dystopian fantasies.

                • Molly …
                  4 August 2015 at 10:40 am

                  My older children have been doing some of the online courses at both futurelearn and edX as part of their home ed curriculum as well. (Finding it difficult at the moment to balance those with the idea of getting the required NCEA credits through Te Kura. A very pedantic method of learning, and time consuming with it).

                  Interested regarding your suggestion of working bees etc, as I am currently trying to come up with some way to do this in a concrete form where I live. Franklin (in Auckland) is not really a leader in terms of social innovation.

                  Something along the lines of Sector 67 is a possible model for community learning spaces, particularly in urban areas. Don’t have a lot of capital to invest, but currently living on a one-acre rural block within spitting distance of an established community. Only after we purchased, did I get involved in community planning and realise how much of a waste smaller lifestyle blocks are. It would be partly cathartic to create some value out of it instead of extending the house, and tidying the gardens to flog off.

                  Home education has given me some experience at collective classes and disparate group meetings. It is time to take it up a notch.

                  • Stuart Munro …
                    4 August 2015 at 12:41 pm

                    I think the initiative is very sound. Sector 67 looks great – though the particular technologies and facilities need to coalesce around what people can use or learn to use in each locale.

                    From the Alt/Ed side of things, the object is to get people undertaking the risky business of genuine self-directed learning with support. Dr Tae has a few useful things to say here

                    Institutional education isn’t performing particularly well – and the neo-liberal prescription tends to increase the dysfunction. Csikszentmihalyi is worth reading too.

                    • Molly …
                      4 August 2015 at 12:59 pm

                      Thanks. Will have a look.

                      As an aside, sent my eldest off to to a Foundation class at MIT last year.

                      He completed it, but was scathing of the quality of teaching and material given to young adults. So was I. Although the certificate was in creative arts, the level of discourse and the expectation of the students was abysmal. We were doing a higher level of work at home several years ago, and I am fundamentally deficient in any kind of artistic skill.

                      The most disturbing aspect though, is the outcome of some of these courses would be to further alienate students from learning, whether in an institutional setting or personally. I’m very glad we met the Youth Guarantee criteria and did not waste the $5,500 fee that this course charged.

  10. Stephanie Rodgers 10
    2 August 2015 at 6:12 pm

    I’m thoroughly in favour of a UBI. I think one of the difficulties is that even though it’s being talked about in Labour Party circles at the moment (probably the Greens too, I’d imagine) it’s still in very wonky, detailed “look at this spreadsheet” terms. When you want to achieve a fundamental shift in how government provides a safety net for people, you do need to outline it in a way people can easily get their heads around.

    • weka 10.1
      2 August 2015 at 8:16 pm

      Yep. Green Party policy is to use government funding to investigate how a UBI should be done and to promote public debate. It’s a bit of a chicken and egg situation. Without funding what party is going to do justice to it, and without doing some substantial work on making the UBI concept accessible how would it get support?

      The concept of how taxation is a crucial part of the UBI could be explained in graphics rather than tables. Simple explanations of tax terms would help too. I don’t for instance know what marginal tax means and when people use it in these conversations I have to go through a translation process. I think many people would be in a similar situation to me, and the only reason I understand the concept is because I spent the time teaching myself what the various posts on ts meant. Most people aren’t going to bother if it’s not easier. So there’s an education process as well as making it accessible.

      • Stephanie Rodgers 10.1.1
        2 August 2015 at 9:35 pm

        Much as I hate to promote anything done by Gareth Morgan (though at least this is actually in his area of expertise) he’s done a good series of short, accessible videos about UBI.
        https://www.youtube.com/playlist?list=PLneuhRbDIJCUpEWuVYzBCpgyAmSDf1WQ0

        As a movement we must have the resources to get the message out plainly and simply, and in the internet age (*smacks self on wrist*) you don’t need the same level of resources to broadcast ideas.

        I bet White Man Behind A Desk would do a phenomenal job of it.

        • weka 10.1.1.1
          2 August 2015 at 11:02 pm

          Thanks, I’ll check those out. I think they’re for people already interested, but too much for most people who just want to get their head around the basics.

          • Stephanie Rodgers 10.1.1.1.1
            3 August 2015 at 9:16 am

            They’re for people who are already interested inasmuch as they’ve had no real promotion aside from being put on GM’s YouTube channel. The point I was making is that there’s no need for “substantial work” to make the concept accessible nor get the message out. The anti-TPPA campaign is another good example of this.

            • weka 10.1.1.1.1.1
              3 August 2015 at 10:28 am

              hmm, I think the anti-TTPA campaign has involved substantial work. I agree with you that the vids are a useful resource, but a lot of people outside the politicos are going to look at that list of vids and turn off. I was thinking of something really basic like a single page of graphics that has flow charts or similar that people can look at in one go and get their heads around the basics (that’s people who don’t know what a UBI is). With links for further reading/vids etc. Maybe Morgan already has something like that?

              It really needs someone like Action Station to pick up, that has a team of people who know how to promote an issue. Much of the discussion I’ve seen on ts revolves around people who know how UBI would work who are arguing about the detail, and people who kind of get it but throw up questions that come from not really getting it.

              eg lots of people refer to Morgan’s work. Is it preferable to Rankin’s, or is it just that Morgan has a higher profile?

              I like what CV has done with this post in terms of raising issues like the difference between work and paid jobs. I think those kind of softer concepts will be important as well.

  11. Macro 11
    2 August 2015 at 6:21 pm

    Thanks CV for a very useful and informative post. Our society is now so individualised that it is difficult for many people to see just how better off we would all be if, instead of working just for ourselves, we were to work for each other. A very good example that I have come across recently, where people work for each other, and where the benefits are profound, is in the FoodTogether program started by Craig Dixon in Christchurch. http://foodtogether.kiwi/
    Currently the programme packages around 2500 – 3000 parcels of fresh produce a week for a cost of $12 per package – enough for a family of 4 for much of the week. This is health eating, and recipes for the packages are available on facebook. Obviously this is a non -profit organisation and runs on volunteer work (around 300 are involved in Chch alone I gather).
    Such a community development as this demands time and effort from people working together to provide better outcomes for others. I believe projects such as this, are the way forward to a far richer, and more interesting, and caring society. And such would be made possible with a UBI – for as can be seen it doesn’t take a lot of money, but when we pool resources in this way, we can all benefit.

    • Colonial Viper 11.1
      2 August 2015 at 6:33 pm

      +100

      initiatives which allow people to contribute to the non-$$$ economy in order to support themselves and each other are going to be increasingly important.

  12. marty mars 12
    2 August 2015 at 6:35 pm

    Great post. It is time for this.

  13. gsays 13
    2 August 2015 at 8:36 pm

    Great post cv.
    I caught part of the guy standing lecture in wellys earlier this year.

    An attractive aspect of the ubi was it appealed to the right as well, as it enabled people to participate in the ‘market’

    I also agree that the community building potential of this kinda initiative is where its real value lies.

  14. Andrea 14
    2 August 2015 at 10:15 pm

    Aside and related: at present many ‘prices’ are fixed on the assumption that all payers have big incomes and frequent pay rises. Think rates, rents, water, power, vehicle licensing, health costs, education.

    Regardless of inflation rates, and the low or no increases in most pay packets, up go those basic costs of living and participating in monstrous leaps.

    A UBI sounds nice but look at reality of living on a fixed income where those who can earn more peg increases to what they can afford.

    Life on the whiff of an oily rag – particularly when the opportunity to add a little extra is limited by age, infirmity, location, or skills – is not exactly ‘living’. More like eking out and barely existing.

    Mr Micawber’s famous, and oft-quoted, recipe for happiness:

    “Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.” Charles Dickens.

    We’ve got a lot of the latter.

  15. Craig H 15
    2 August 2015 at 10:51 pm

    I’m a believer and look forward to it. I think it will be major policy plank of the next Labour Govt, but would work best just to be introduced at the first budget, rather than argued about as a bribe during an election.

  16. maui 16
    2 August 2015 at 11:13 pm

    Can’t wait for it. I think how it might possibly come about is either through a big economic collapse that we can’t find a way to get out of, or a series of downturns. Status quo governance is going to be completely inadequate for more and more job losses. People will move to the party that has a UBI, and hopefully that won’t be National through stealing other party’s policies.

  17. keyman 17
    3 August 2015 at 4:20 am

    the current system is unsustainable but to get where we would like to be we need a total crash and reset.but i wouldn’t like see a Greek situation where the elite are pandered to more like Iceland where the the crooks are dealt with and removed so proper reset can begin

  18. geoff 18
    3 August 2015 at 7:45 am

    ‘Precariat’ is a shitty word. Sounds like something a turtle-neck-wearing, chardonnay socialist would come up with.

    How about ‘part-timer’, a nice contrast to the name of the social clique that John Key’s son is a part of…’the fulltimers’.

    http://www.nzherald.co.nz/lifestyle/news/article.cfm?c_id=6&objectid=11471687

    • Colonial Viper 18.1
      3 August 2015 at 5:38 pm

      heh blame the highly academic Dr Marx for introducing terms like “bourgeoisie”, “proletariat”, etc. of which “precariat” is in the same vein .

  19. half crown 19
    3 August 2015 at 7:58 am

    I have just noticed my appalling grammar at 7.3.1.3. I don’t know why that happens at times, can only put it down to the S O S syndrome.

    Damm should read Damn, and religions should be religious

    If you have not read it, I highly recommended what we are reading at the moment.

    “Debunking economics” by Steve Keen

    • half crown 19.1
      3 August 2015 at 8:16 am

      Shit I did it AGAIN recommended should read recommend.

      Keep taking the tablets it will come right I hope.

      • RedLogix 19.1.1
        3 August 2015 at 8:33 am

        Quite a few of us here have been long-standing fans of Steven Keen.

        I did a post back on a while here:

        http://thestandard.org.nz/i-owe-my-soul-to-the-company-store/

        And met the guy when he came to Wellington about 2 years ago. The back row of the room was lined with heavy weight RB and Treasury types. Russel Norman was in the front row asking questions – all up there were probably about 100 or so beltway types in the room. As ordinary joe public I felt a wee bit out-gunned.

        But during a break I did have a 10 min chat with him. I found him passionate and committed … with a lot of warmth when he’s not lecturing.

        The good news is that since moving to London he’s gained a lot of profile and attention.

        • half crown 19.1.1.1
          3 August 2015 at 9:52 am

          Thanks for that Red and the heads up to your earlier post.
          What I have read so far is most interesting, like neo classical economic students are not taught economic history. That explains one hell of a lot of the thinking of the majority of modern day economists. Very dangerous and I can see why this TINA is always used. They have no history as a bench mark and the likes of the 2008 crash was not the fault of neo classical economics. As Keen points out in his book their thinking is, neo classical economics can never fail.

          My words, What a fucking joke that is, I am not the sharpest knife in the draw but I have so easily pointed out to some of these Neo’s the disastrous results of this shit, and nearly every time there is no answer. They haven’t got one. TINA..

          • Colonial Rawshark 19.1.1.1.1
            3 August 2015 at 10:27 am

            You’re going to like this video I think HC, it explains a lot about the ahistorical nature of university economics courses.

            Economics, power and the powerful: Institute for New Economic Thinking (INET)

            “The cry of “loss of confidence” is largely a smokescreen let loose by certain conservatives who are traditionally opposed to almost any Government expenditure, who object to any increase in taxes, and are too shortsighted to know that the perpetuation of the present level of unemployment constitutes de most dangerous threat to their own interests … The statement that the bond market could not absorb Government bonds has been made ever since the first unbalanced budget, yet today Government bond prices in the United States are higher than ever. … If [companies] do not employ the potential purchasing power [of the unemployed], the Government can do so at virtually no expense to the community.”

            – Harry Dexter White

            • half crown 19.1.1.1.1.1
              3 August 2015 at 10:37 am

              Thanks colonial I have to do some work now will have a look tonight.

              • Colonial Viper …
                3 August 2015 at 11:28 am

                Oh yes I should mention that Steve Keen is one of the speakers in that video; Lord Robert Skidelsky is also very good.

  20. Jones 20
    3 August 2015 at 8:11 am

    Great post CV and a great Keiser Report. I’m definitely for a UBI and I believe it needs to be universal.

    Having worked in the IT sector since the late-80s, “technology is now destroying more jobs than it is creating” has been my sense for at least the last decade. I’ve seen too many technology implementations of systems justified by savings in FTEs. It’s not uncommon for the disestablished employees move off into lesser paying jobs or part-time work, and it seems to me they rarely find like for like.

  21. greywarshark 21
    3 August 2015 at 11:13 am

    I looked and listened at Guy Standing and thought that was a great link thanks CV.

    Further to that I was interested this morning hearing on radionz Sir Peter Talley make some prognostications that sound realistic about the future and work and people as he sees it. Worth a listen.

    http://www.radionz.co.nz/audio/player/201764873
    Originally aired on Business News, Monday 3 August 2015
    The head of one of New Zealand’s largest food companies predicts more change for business over the next five years than it’s seen in the past twenty five years. The loint managing director of the Nelson based Talley’s group, Sir Peter Talley, opened the Nelson Tasman Chamber of Commerce annual business leaders conference, Aspire.

  22. CJess 22
    3 August 2015 at 4:02 pm

    I am very much in faviour of UBI, and have been (on and off) arguing away about it with anyone who would listen for over a decade now.

    Interestingly, Utrecht, in the Netherlands, is currently carrying out an experiment with it. That’s one worth watching.

    http://www.independent.co.uk/news/world/europe/dutch-city-of-utrecht-to-experiment-with-a-universal-unconditional-income-10345595.html

  23. Colonial Viper 23
    3 August 2015 at 5:49 pm

    I think from the many insightful comments here that we have also created a clearer understanding of why Labour’s intention to reduce NZ Super entitlements (our UBI for 65’s plus) went down with the electorate like a cup of cold sick. It was exactly the wrong direction to go and Kiwis knew it.

  24. old school 24
    3 August 2015 at 7:08 pm

    Universal fairness for everyone,a oxymoron for a profit exploiter capitalist thinker not conducive to a society fairness,how is your profit property ownership portfolio profiting you.

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