Pereira - Financing Basic Income Addressing the Cost Objection

The Author(s) 2017

Richard Pereira 1

(1)

Abstract

The different ways in which basic income can be financed are set out in this chapter as a guide to reading the book. A decent basic income is presented as the goal of this work, as opposed to some basic income proposals that may be viewed as potentially worse than status quo income security programmes in various countries. Protecting vital public programmes such as universal health care or public education, for example, is essential to implementation of a decent basic income, as is setting it at a sufficient level to ensure a dignified existence and a measure of social inclusion. Proposals that set out to cut public programmes in wholesale fashion and set a low level of basic income are rejected. Income security programme redundancies are discussed in this light along with differing models and methods of financing basic income.

Keywords

Richard Pereira

is Doctoral Researcher at the University of Birmingham, UK, and was formerly an economist with the House of Commons in Canada.

This book addresses the cost objection to basic income and whether a decent basic income is affordable. What are the public costs and savings of implementing basic income? It is important to emphasize that a basic income that is set too low, or below the official poverty line of a society, is not meeting the goal of a basic income as presented in the academic literature and in more common political and popular presentations of the concept. The objective of this public policy is to provide members of a society with the ability to meet basic needs and achieve a measure of social inclusion, even if they cannot find a job in the labour market to provide adequate income to satisfy these basic needs. This book sets out to meet the definitional goals of basic income and it addresses the cost objection by focusing on a decent basic income and its financial feasibility.

Also related to providing an adequate basic income is presenting a proposal which does not cut all or most other public programmes in a wholesale fashion, thereby potentially leaving members of a society in a worse financial state than under the current system. Universal public health-care programmes currently in place in many countries, and the provision of free and subsidized public education, are two examples of programmes which if eliminated in order to finance a basic income would create catastrophic costs for many people that could not be covered by the often very modest and low levels of basic income found in most proposals. The prominent work of Charles Murray provides one such approach, which is not supported by this book. Our goal is to provide a much higher level of basic income than found in proposals such as Murrays, while also preserving vital public programmes such as universal health care. We recognize that many public programmes become redundant with the implementation of basic income, and these savings can be directed to financing basic income. What differentiates this book from others is that public programme redundancies are accounted for and treated in a far more selective fashion than in other prominent proposals, and the level of basic income is set much higher than normally found in the academic literature.

Three countries on three different continents are also analysed in proposing a progressive basic income in this study. The combination of ensuring a decent level of basic income and preserving vital public programmes, such as universal health care and others detailed in the following chapters, ensures an analysis of the financial feasibility of basic income which does not undermine or contradict the objectives of this policy initiative. We want to avoid a regressive basic income proposal, which could leave individuals worse off than under the status quo.