The National League of Cities along with the Stanford Basic Income Lab (BIL) have released a guide for piloting Universal Basic Income (UBI) in cities.
As cities approach positioning for the new economy, UBI is increasingly becoming part of the conversation around citizen security. UBI is a policy whereby the government provides citizens with a fixed income each month that acts as a new type of social safety net. UBI has emerged as a solution for dealing with an economy that is tilting toward short-term contract work without benefits in lieu of stable full-time jobs with benefits.
Cities face a number of labor-related challenges, including job automation, precarious work arrangements, economic insecurity and growing inequality. Experts see UBI as a potential solution because it is a cash payment granted to all members of a community on a regular basis, regardless of employment status or income level. It’s also scalable in cities and shares some features with programs like the Federal Earned Income Tax Credit, the Child Tax Credit and Social Security.
Between 1979 and 2013, studies show that earnings have grown 192 percent for the top one percent of wealthiest Americans, but only 46 percent for the bottom 20 percent. And in the next few decades, millions of jobs could be in jeopardy due to automation. Americans are increasingly warming to UBI as a way to curb these detrimental effects.
“Every person deserves the dignity and safety of having enough money to put food on the table and have a roof over their head,” said Clarence E. Anthony, CEO and executive director of the National League of Cities. “We support the ability of city leaders to pilot – and implement – the kinds of innovative, bold solutions that have helped millions of people.”
For cities that are considering a UBI pilot, there are a few guideposts they can lean on. The guide is designed to highlight some of the lessons learned from pilots in Finland, Kenya, India and Canada. Here in the states, the city of Stockton, California plans to launch a UBI pilot in 2019. The 18-month trial will give 100 residents $500 per month with no restriction on how it is spent. Researchers will check in with those residents through the trial to learn more about how they used it and whether it increased their financial security.
The report highlights policy considerations and early lessons from the international pilots and include input from policy makers in the US.
The full text of the report is available here.
What’s better than an unconditional basic income of $X/week? A punitive #VacancyTax / #VacantLandTax, which property owners are so keen to *avoid* that it reduces rents by $X/week. Why is this better? Because:
(1) Nobody asks where the money is going to come from. (Even the tax, in order to do its job, doesn’t need to raise any revenue.)
(2) By definition, the benefit of lower rents isn’t competed away in higher rents — as all increases in welfare spending tend to be. (You don’t see this problem with “pilot” basic incomes paid to a small sample of people. But you *will* see it as soon as the basic income becomes universal.)
(3) Avoidance of the tax generates job-creating activity — especially because lower rents (commercial and residential) make it easier for employers to pay workers enough to live on.
(4) If the reduction in rents doesn’t serve all the purposes of a basic income, it reduces the size and cost of the basic income needed to serve the remaining purposes.
(5) The additional economic activity broadens the bases of other taxes, allowing their rates to be reduced — offsetting the tax impact of a basic income, if you still insist on introducing one!