Could a basic income for everyone work?

Occasionally an idea comes along that leaves me scratching my head because I simultaneously think that it will never work and that it’s so obviously the answer.  Finland’s basic income is one of those ideas.

Finland is considering a basic income for everyone. I invite you take a step out of your normal biases, whatever they may be, for just a moment and really think about the pros and cons.  Here are my non-exhaustive lists.

Pros

  1. Smaller government since administration is reduced and eligibility interviews, regular checkups and investigations are no longer needed
  2. Maternity and paternity leave become more about resourcing than a combination of resourcing and money
  3. Retraining for a new career becomes easier
  4. Starting a business is less risky so entrepreneurship should increase
  5. Taking a break when you’re burnt out is easier
  6. Very little opportunity for anybody to cheat the system
  7. If the basic income was large enough, social housing could be essentially eliminated
  8. You could get rid of minimum wage

Cons

  1. Potential for a large reduction in the available workforce since some people could self-select out
  2. Nationwide inflation could be an issue during the initial stages
  3. Slackers would slack
  4. Many poor people could come quickly into larger amounts of money than they are used to having and may not manage the transition well. I know I blow money when I get a windfall.
  5. Just having money doesn’t make you suddenly become less disadvantaged in any way other than financially. There will still be social issues to address.
  6. How much is enough?

Could it actually cost the taxpayer less money to do this than the current systems that are in place? Consider the NHS in England: Every once in a while an effort to clamp down on cheats (foreigners getting free healthcare mostly) rears its head and it always turns out that putting the tracking and payment-like systems in place to reduce those losses would cost more than just living with them so we don’t change the system and live with it.

A little more research shows that Canada did an experiment, called MINCOME, similar to this in the 70s and while working hours for the participants dropped slightly, one other noticed change was that “students in these families showed higher test scores and lower dropout rates.” Is the goal of society to push everyone into work or is it to try to move the society forward in general?

When my daughter Sarah was born, the UK government gave me and my wife a monthly child benefit payment. It wasn’t means tested and it wasn’t that much, I want to say around £80/month, but we got it and it was nice. We bought essentials like nappies and formula and although I didn’t need the money, it made me feel like a citizen. I felt like part of the country. That benefit is, of course, means tested now so we didn’t get it for Leo. I always wonder if the means-testing saved money overall after the tax codes, accounting and investigations that followed were added up?

I’m still unsure and will be watching with interest as these basic income experiments get underway.

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