A guaranteed basic income could end poverty, so why isn’t it happening?
On April 27, Senator Diane Bellemare published an op-ed in the Globe and Mail oppose a guaranteed basic income proposal where all Canadian citizens and residents over the age of 17 would receive an unconditional guaranteed sufficient income.
A recent poll suggests that almost 60% of Canadians support a basic income of $30,000. In another poll, 57% of Canadians agree that Canada should create a universal basic income for all Canadians, regardless of their job.
Despite strong public support, Bellemare argued that “a basic income would be an unfair, complicated and costly way to eliminate poverty”. As a social scientist who has studied cash transfers, and an entrepreneur and organizational leader, we challenge the idea that basic income is “unfair”, “complicated” and “expensive”. Instead, we argue it can be fair, simple, and affordable.
Basic income can be just
Basic income can be fair for all Canadians and suitable for people with different needs. A system that includes basic income does not necessarily imply the clawback of existing benefits and services.
It is important to note that a phased and carefully designed basic income program can be monitored and adjusted over time, to ensure that diverse individual needs are always catered for.
Research from Stanford University suggests that a basic income program can inspire meaningful social integration – greater participation in social and civic activities in the community – while providing individuals with stability, safety and security.
An analysis of the Ontario Basic Income Trial showed that people with diverse needs reported better personal relationships with friends and family on a Basic Income. In turn, their sense of social inclusion and citizenship has improved.
Basic income can be simple
With careful planning, a basic income system could be designed to be simple, adaptable, reliable, and equitable. In other words, it could be a type of synergistic solution that involves an optimal combination of different policy programs that produce greater efficiency. For example, a basic income program could be combined with a wage subsidy program.
Contrary to Senator Bellemare’s assertion that “Basic Income would likely hinder participation in the labor market,” research has found that Basic Income has no negative impact on the labor market. In other words, the basic income does not have a negative impact on employment rates or wages.
With a basic income program, recipients would be motivated to participate in the workforce and feel empowered to discover the most satisfying way to work without fearing for their financial security.
Basic income can be affordable
Recent cost-benefit analyzes have demonstrated that carefully designed cash interventions can be cost-effective and generate net savings for society. Beneficiaries depend less on social services over time, which means governments pay less to fund these programs.
While Bellemare’s analysis suggests there may be a cost issue, other, deeper analyzes have considered the true costs and benefits of basic income programs and refuted this claim.
We caution against overly simplistic cost estimates and call for a more careful and thorough calculation of the true costs and benefits associated with basic income programs. In fact, Canada can adopt a basic income program without increasing its tax debt.
Last year, the Office of the Parliamentary Budget Officer of Canada estimated that a guaranteed basic income of $17,000 per person would cost the government $88 billion.
This amount could be offset by reducing tax credits that disproportionately benefit Canadians with higher incomes. In addition, a well-designed basic income program can provide non-monetary benefits that are not typically captured in cost-benefit analyses, such as improvements in health, education, social cohesion and productivity.
Read more: Giving people money unconditionally is good for their health, according to dozens of studies
Research supports Basic Income
There is a tremendous amount of research supporting Basic Income around the world. It is prudent to conduct considerably in-depth research to reduce hesitations about basic income for social and economic reasons. Basic income can be a reliable and powerful component of a national program to reduce poverty and enable all citizens to thrive.
Basic income should be part of a comprehensive and practical plan to end poverty in Canada. Indeed, there is an emerging political will to push for a national strategy for a guaranteed basic income.
Last summer, Liberal MP Julie Dzerowicz sponsored Bill C-273, the National Guaranteed Basic Income Strategy Act. It was the first time that a Basic Income Bill had been debated in Parliament. And in February 2021, four senators — three from Prince Edward Island, one from Ontario — released an open letter calling for a nationwide Guaranteed Basic Income.
This is essential, because poverty is a useless and cruel abomination. Think of it this way: most Canadians probably have a close friend or family member who is affected by poverty, since one in 15 Canadians still lives in poverty.
Poverty affects us all — it is everyone’s tragedy, which is absurd because poverty can be reduced at an affordable price, as explained above. Hopefully, one day future Canadians will look to 2022 and wonder how a just society could have tolerated such needless suffering.