Basic income at a time of economic upheaval

Last week I was in Montreal for an international conference on “Basic Income at a Time of Economic Upheaval: A Path to Justice and Stability?” This conference, sponsored by the Centre de Recherches en Ethiques de l’Université de Montréal, BIEN Canada and USBIG, welcomed nearly 90 participants from around the world. It was an excellent and thought-provoking several days of discussion about Guaranteed Livable Income (GLI) and its prospects in our time of economic uncertainty.

The conference began with a smaller workshop on Wednesday, focused on the methodology of empirical research. Several presentations offered thoughts on different kinds of research, including modeling, historical experiments, and pilot projects in developing countries.

One of the most interesting insights of the Wednesday workshop for me was the role of social influence in people’s response to GLI. Both in the computer modeling and actual experiments, people’s behaviour differs from what basic economic assumptions would expect because of the role of social influence. People experience many different motivations and influences regarding how they use their income and whether or not they participate in the paid labour force, and interactions with others play a key role in determining which motivations will hold sway.

There are also social benefits from GLI. In the Dauphin experiment, for instance, where only those under a certain income threshold actually received payments from Mincome, everyone in Dauphin benefited from lower crime rates, higher school enrollment, and lower hospitalizations. GLI has an important community effect.

On Thursday and Friday, there were 18 presentations and keynote lectures on various aspects of basic income. Some of the presentations focused specifically on what GLI could or should look like in Canada, such as a presentation by Jim Mulvale of the University of Regina and Rob Rainer on Canada Without Poverty on what guaranted income in the short-to-medium term could be in Canada. Others focused more particularly on one aspect of employment or poverty. A number of presentations discussed the possibility of a basic income paid for through resource rents (as in Alaska), rather than through taxation.

One of the more out-of-the-box presentations came from Sally Lerner, who discussed the need for a renewed education system. Rather than training our children to be good employees, she argued, we need an education system that fosters creative and critical thinkers, willing and able to become engaged citizens. Kids need to have a broad array of motivations and understandings nurtured, as well as learning to value diversity. This will enable people to fully benefit from a level of income security that provides more choices in life.

An excellent keynote lecture from Guy Standing reinforced the point about the challenges for an engaged, informed citizenry. Standing, who has been looking at the transformations of labour and work in a recent book Work after Globalization, argued that increasing intensification of labour, work and consumption has come at the cost of leisure. People no longer have the time and energy to participate as social citizens anymore. Among other things, freedom requires control of your time.

Finally, a number of presentations, my own included, looked at the challenges created by the economic crisis and opportunities and lessons learned for GLI. My presentation looked at recent research done on poverty and economic trends during the recession (more information coming shortly on our website!), and suggested several lessons for basic income.

Essentially, I argued that if we keep to the status quo, we will keep seeing poverty rise and fall with the economic cycle. We need to do something different if we want to see different results. The recession also demonstrated that work doesn’t provide security – many of those who were likely to be working poor before the recession began were also the most likely to lose their jobs during the recession. Unfortunately, this pattern will be reinforced by the trend towards increasing precarity of work caused by the recession.

Employment Insurance was proven to be completely and totally inadequate in dealing with the recession – at the peak of its coverage, only 51% of the unemployed were receiving benefits. Canada’s major unemployment program therefore does not even cover half of the unemployed! It’s time for a new approach to economic security.

And the final lesson was that GLI needs to be indexed to cost of living, not core inflation. Cost of living rose sharply in 2009, although core inflation was fairly low. Because people need to count on their incomes to pay for things like food and rent, incomes must rise as food and rent rise.

I’ll post my slides in a few weeks. In the meantime, here’s a lovely photo of me explaining one of my slides: