Tuesday, August 7, 2018

Tuomas Muraja - Universal basic income hasn’t made me rich. But my life is more enriching

Trying out the scheme in Finland pushed me to find better work opportunities. It beats a complicated benefits system

Toumas Muraja believes that the Basic Income trail in Finland was a massive success. I can see how it could really help people to start their own business as it would reduce stress and enable them to take more risks. KV
Basic income models do come with a small increase in taxation. For a large number of employed people this will, however, be compensated for by the basic income. As more people manage to find work while supported by basic income, taxation for everyone can be eased. In terms of purchasing power, basic income would have a predominantly positive effect as it would help people in low-income jobs the most. The critics fear that basic income will make people lazy. However, limited evidence from several basic-income trials from around the world prove that people use basic income to improve their quality of life and not as a licence to do nothing. Research has shown that unemployed people do not have a low motivation for work. Neither is it justified to say that unemployment on a large scale is the result of an unwillingness to work. The isolated cases of lazy, work-averse individuals so eagerly highlighted by the media do not represent the situation accurately.
I hope this trial encourages future governments to examine fresh options. My living costs today stand at nearly €2,000 a month – it’s a sum I would never be able to pay with just the basic income. And that was not the idea. Rather, basic income acts as the perfect incentive – it gives you security to chase other opportunities. It pushes you to seek fulfilling work – and isn’t that what unemployment benefits should do?
The Guardian 

19 comments:

ANC Driver said...

" The critics fear that basic income will make people lazy. "

The irony is, is that critics themselves are usually the laziest when it comes to actual production of human needs and other useful production.

Whether we have a JG program or a BI program, or surplus arrangement program, or any other program different from the now current 'work for corporations' program, it should never be a political or economic issue, but always a legal issue. Everyone has a legal right to obey the law, and when a property based economic system strips some people of the ability to obey all laws, the property owners are guilty of crimes against humanity, against human rights, against common and civil law rights, against constitutional rights.

Calgacus said...

The problem of course is that unless Muraja is all Finns, it was not a trial of Universal income at all. It was just an experiment that showed being richer is better than being poorer. No kidding.

Universal income just puts the economy on an inflationary treadmill. It might have some benefit at the bottom of a rare, very deep depression. But once an economy revives, basically, it's all bad. Stupid studies and stories only look at the benefit to the recipients, which are temporary and only really exist when the income is NOT universal. They never look at the effect of the tsunamis of money that it would pump into the economy, UBI has a very low "bang for the buck". Job guarantees have a very large one.

The neoliberal trick called UBI will not ensure that everyone will have work, that the jobs will magically appear. Jobs only appear because of human decisions, not from some neoclassical fantasy that full employment is automatic.

The cost of living will just go up enough to eat up the basic income. Economics, even Keynesian or MMT economics is not magic. It's just that not having full employment is idiotic and as ANC Driver says, criminal, that it looks like magic.

ANC Driver: property based economic system
A major problem is this very narrow modern definition and understanding of property which should be abandoned, identifying property with a very restricted form of private property. Your labor or labor power is your property. Human rights can be considered property. All human societies have property. Economic systems basically must be based on property. And this way of speaking is the older and more logical way of thinking about property.

it should never be a political or economic issue, but always a legal issue
Dissociating politics, economics and law is not something that usually ends well. The law is not a white knight that sits above society, but must be informed by rational economics (e.g. not the UBI) and based on a politically achieved moral understanding. There is no alternative - to politics. And there is a political solution, even in this material world.

Konrad said...

"The irony is, is that critics themselves are usually the laziest when it comes to actual production of human needs and other useful production."~ ANC Driver

Well said.

Another irony is that a UBI (i.e. comprehensive Social Security) would benefit lower class workers, but it is lower class workers who scream loudest against a UBI.

They do this in order to cope with their ever-worsening misery. That is, the peasants cling to comforting delusions which take myriad forms, but which all amount to a false belief that no matter how badly they are suffering now, any change would make their suffering even worse. Universal Social Security, for example, would destroy the world!

Why? It just would.

Indeed, the worse off the peasants become, the more they defend their misery. They insist on staying in their torture chamber. The door to their chamber is always open, and they can leave any time they like, but they have convinced themselves that freedom from torture would be even worse than torture.

This is why the peasants call socialism and a UBI “evil.”
Why?
They’re just evil, that’s all.
(What are you, a Commie?)

Konrad said...

“The problem of course is that unless Muraja is all Finns, it was not a trial of Universal income at all. It was just an experiment that showed being richer is better than being poorer.”

False. It was an experiment to see how average people would react if they had less financial pressure, and more freedom. All these experiments prove again and again that people with a UBI work more not less. A UBI gives people freedom to take risks, develop new ideas, and become more entrepreneurial. People are no longer trapped on the slave plantation, since the plantation is no longer their only source of food and shelter.

People with negative views of UBIs have negative views of everything, especially their own lives and of everyone around them. They think that everyone (but themselves) is a lazy freeloader. And so they devise all sorts of nonsense explanations for why a UBI is “evil.”

That said, I do agree with the person above who says that without basic changes to our society, a UBI would produce more income for the rentiers and the debt slavers to steal. A UBI would, for example, make the current extreme inflation in housing prices even worse.

A JG would do the same thing, but for some (unexplained) reason the person above does not think so.

Quite simply, unless we get the bankers under control, we are screwed no matter what.

Kaivey said...

I remember, Konrad, when in the UK people got mortgage interest tax relief but every time the Conservatives increased the relief house prices would just go up and so people would get nothing out of the tax cut.

Konrad said...

@ Kaivey:

Why do housing prices go up when average people have more money to spend?

The reason is that a property is “worth” whatever a bank is willing to lend on it. Since banks create their mortgage loan money out of thin air, banks continually apply upward pressure on mortgage loan amounts. Ever-larger loan amounts mean ever-larger bank profits from interest payments. As property prices rise, so do the rents that tenants are charged. All other prices rise concomitantly.

Bankers are the primary drivers of inflation. Bankers are why a hundred-thousand dollar property in 1860 would cost $3.036 million today. Bankers are why you would need $30.36 today to buy what only $1.00 bought in 1860.

Fyodor Dostoyevsky wrote in The House of the Dead (1861) that “The degree of civilization in a society can be judged by entering its prisons.”

True, but we can also judge the degree of civilization in a society by looking at how society tolerates bankers.

"Give a man a gun and he can rob a bank. Give a man a bank and he can rob the world."

Andrew Anderson said...

The problem isn't bankers per se but banks.

And the problem isn't banks per se but government privileges for banks including implicit privileges such as the failure of monetary sovereigns to provide citizens with the means to directly use their Nation's fiat in convenient, inherently risk-free form via accounts at the Treasury (or its Central Bank) itself - leaving them at the mercy of a government-privileged usury cartel extending the public's credit but for private gain, especially for themselves and the rich, the most so-called "creditworthy."

To blame bankers or lack of regulation or the public or greed or human nature or anything else for the failings of an INHERENTLY CORRUPT fiat and credit creation system is PREMATURE at best.

ANC Driver said...

Maybe the government operates on the presumption (until shown otherwise) that it is everyones desire to accumulate financial wealth and to retire young (i.e. to fulfill the behavioural attributes that all economists claim humans are inherently posessed with), and hence the reason they continue to support a debtor/creditor system. Put another way, no one says to government that they don't want to retire young and enjoy the fruits of passive income so maybe government is simply acting on the signals we are all giving them.

Tom Hickey said...

More like that's the why that the elites think. They are typically work-avoidant unless it involves rent-extraction that produces wealth without productive work. And they generalize from their own experience and attitude, considering the rest to be dummies.

Konrad said...

“The problem isn't bankers per se but banks.”

Banks are not conscious entities with a will of their own. Banks consist of bankers and their enablers, which is most people. The true problem lies in bankers and their enablers.

“And the problem isn't banks per se but government privileges for banks including implicit privileges such as the failure of monetary sovereigns to provide citizens with the means to directly use their Nation's fiat in convenient, inherently risk-free form via accounts at the Treasury (or its Central Bank) itself - leaving them at the mercy of a government-privileged usury cartel extending the public's credit but for private gain, especially for themselves and the rich, the most so-called "creditworthy."

I personally believe that no bank should ever be privately owned and operated on a for-profit basis. Instead, banks should be regarded as social necessities like utilities and fire / police departments. As such, banks should be publically owned, or else all banks should be divisions of the U.S. Treasury, as you suggest above.

As you intimate, the power of private for-profit banks to create loan money out of thin air is a recipe for inevitable inequality and disaster.

“To blame bankers or lack of regulation or the public or greed or human nature or anything else for the failings of an INHERENTLY CORRUPT fiat and credit creation system is PREMATURE at best.”

Again, fiat and credit creation systems are not conscious entities. They are owned and controlled by humans. System corruption starts with (and is proportionate to) human corruption.

Konrad said...

“Maybe government is simply acting on the signals we are all giving them.” ~ ANC Driver

Yes. I have long contended that the peasants want fairy tales. They want to be lied to by politicians, who obligingly provide what the peasants demand.

For example, Alan Greenspan, Ben Bernanke, and others have admitted that the U.S. government can create infinite money out of thin air. There are YouTube videos of them admitting this.

However the peasants ignore these truths, preferring their fairy tale that the U.S. government is “broke” and has a “debt crisis.”

ANC Driver said...

Tom:
More like that's the why that the elites think. They are typically work-avoidant unless it involves rent-extraction that produces wealth without productive work. And they generalize from their own experience and attitude, considering the rest to be dummies.

Economists have always maintained that humans have unlimited wants and desire to obtain these wants with least exertion - that is a rentier through and through. Do you believe they are describing you? Maybe when economists were first describing humans as such, it was at a time when most people did not own property or were not free agents (in the economic sense), and so they were really only describing those few who were the property owners and were therefore the only ones who had any serious economic impact. Today of course, the inverse is true and just about everyone is an economic agent (whether they want to be or not).

I'm not saying however that generally people do not want to produce, and nor am I implying that someone who wants to retire young wishes to cease producing - however - do people produce because they have some community spirit motivating them? I say no, and I say that people only produce because at the end of it they get paid, because they get some reward which is personal to them, and if they weren't gonna get paid they'd stop producing.

If I was to put myself in the governments shoes, what I see are people who although seemingly hard working producers of various kinds and levels, what they all share in common (at least from the middle class upward) is the desire to own homes and portfolios, climb class ladders, compete, enforce all legal agreements, sue when infringed upon, influence politics, and at the end of the day compare their results to the next guy. All of this requires contract law, courts, creditor/debtor relations and so forth and so that is exactly what government is providing. Here in Australia, around 150 years ago, we actually had farmers and the like operating under surplus share arrangements with government, where government owned the land and capital and invested in the farmers success 'literally' and not just financially - these farmers did not have 'commercial goals', but had physical productive goals where they produced for themselves and gave the surplus to government, and what they couldn't produce for themselves, the government would provide in exchange for the surpluses. These types of relations are 180 degrees the opposite of our commercial/contractual, taking based, pre-determined interest/profit rate arrangements we are all forming today. But no one operates, or claims to want to operate, under these surplus share types of relations today. Everyone wants to stick with the contractual relations. This is what I meant by the signal we are sending government.

Tom Hickey said...

The neighbor of a friend of mine won a 20 million US lottery. He is a trade person. He loves his work and loves working with his buddies and going fishing on weekends. He bought a bigger boat. That's it. Still goes to work every day for the joy of it.

On the other hand, hIs wife is a nurse and loves nursing but hates her employers. As soon as she got the check in her hands, she told them to stuff it.

In other words, it's nuanced, and it is not all about the money.

ANC Driver said...

My parents won the lottery once (ended up bankrupt 4 years later..lol)

Of course, the question I am prompted to ask is, if he is so happy to work his job and with his lot in life, why buy lottery tickets to begin with (rhetorical)?

Tom Hickey said...

He gave a lot of the $ to their church for some project and paid off the mortgages of his family.

Everybody happy,

Kaivey said...

Konrad, my mortgages were always crippling, and throughout life I was always poor because of them. I had no holidays, or an occasional budget holiday, cheap cars, etc, and at one point, a flat i was too scared to put the heating on in winter. When I lived at home and was on good wages, I lived the good life going out almost every night and socialising, but when I bought my first flat all I could afford was to go out on a Friday and a Saturday night. It was hard.

I remember how after 4 to five years the price of the flats had doubled and people were bragging about how much their flats had made. They felt rich, but I told them that they had really become poorer because the house they wanted to buy had become even more expensive outstripping the gains they had made on their flats. Unless they intended to stay put and never sell their flats, then they had mad money, but if they never intended to sell, then they had mace no money, it was only paper money. Well, they didn't lie what I said and so just ignored it still bragging about all the money they had made.

Anyway, I used to love my job but the company kept cutting the staff until I was the only electrical engineer left, while the electrics and electronics got more and more sophisticated. In the end I got burnt out and retired early never to be well enough to work again. Neoliberalism had wrecked me.

Now I'm thinking of getting the equity out of my house when I'm 65 years old. Now my property might be worth £400,000 and I suspect the most i will get will be about £100,000 to £150,009. I will admit I haven't looked into it yet. The banks will say that it could be a loan for 20 years on average. now that's a long time to have a loan and not be paying any interest back on it, ans as we all know bridging are expensive.

So, the banks create the money out of nothing and give me £150,000 and wait maybe 20 years to get my house. Now something doesn't seem right here. It probably took a clerk at the bank about an hour or two to set up my loan, and all they had to do was put some numbers into a keyboard to generate the money. So i get £150,000 but there is still £250,000 outstanding on the house. Now if someone wants to invest £250,000 for 20 years in the hope of seeing it double or triple in value they are going to have to put £250,000 down in cash first, but the banks have got this investment for free as they created the money out of nothing. Okay, they do want to be paid for the £150,000 loan they made to me, but that £150,000 is also invested in my house and over 20 years it may double or triple in value as well so they will get paid handsomely that way.

So, there you have it, they give me £150,000 as a loan which is invested in my property and will in itself double or triple in value over the years, plus there is an outstanding £250,000 left in my property which they have not invested in but they will get for free.

So, I have been made poor all my life by huge mortgages and I had to do 50 to 60 hours at work a week making the bankers rich, then at the end of my life they give me £150,000 for my house and then wait for that £150,000 to double or triple in value, while they get the other £250,00 in my property for free which will double, or triple, in value as well over the coming years. What a rip off!

Kaivey said...

But I was one of the lucky ones because if I had been born in the third world I may have to work over a hundred hours a week, or more, just to eat, but the ruling class set me to work too getting every penny out of me they could, rather like they do with the animals at a factory farm where profits are maximised.

Now, millions of people around the UK believe they are rich because their houses are worth so much and so they vote Tory believing they are part of the landed gentry, but they worked their nuts off all their lives to get that property, and really, it had made them poorer as they had far less purchasing power and this also affected the economy which meant their children found it harder to get good, well paid jobs. So really, they have been stung, by the Tories they mix with at their at their local Conservative clubs. Their own brethren has taken them for a ride.

Andrew Anderson said...

and enjoy the fruits of passive income ANC Driver

Since SOME fiat creation is good, if not an absolute moral necessity, then a Citizen's Dividend is a straightforward means to provide passive income equally to all citizens.

Of course to maximize the amount of the Citizen's Dividend both in nominal and real terms, the banks must be de-privileged and that would include forbidding the Central Bank from creating fiat for any purpose other than to provide a Citizen's Dividend and to finance normal deficit spending by the monetary spending for the general welfare only.

Andrew Anderson said...

Make last sentence "and to finance normal deficit spending by the monetary sovereign for the general welfare only", please.