Experiments with a Basic Income 

By Harrie Salman

In several countries of the world limited forms of a basic income have been introduced as an experiment in small settings. Recently new pilots started in Holland and Finland.
A basic income, also called a citizens's income, is a form of social security in which people living in a country receive an unconditional sum of money as income. This sum should be an amount of money above the poverty line and can be lower for certain groups (such as children).

One of the first proposals for “capital grants provided at the age of majority” was formulated by Thomas Paine, one of the founding fathers of the United States, in his Agrarian Justice of 1795. Prominent advocates of the basic income idea are Guy Standing, professor of economy at the University of London, the Belgian professor of economy Philippe van Parijs, both co-founders of the Basic Income Earth Network (1986), and the German businessman Götz Werner, founder of the drugstore chain “dm” with over 1500 stores across Europe.

Early experiments

First experiments were made in the 1960's and 1970's in Canada and the USA in the form of a negative income tax that gave people with a low income a supplementary income.
In American right-wing circles that are generally against the public provision of welfare money to the poor, we also find support for a basic income because it could lead to a reduction in bureaucratic administration. Milton Friedman (1912-2006), the American economist and one of the founders of neo-liberalism, was in favour of it for this reason. But usually the supporters of a basic income can be found at the opposite side of the political spectrum, in countries with a well-developed welfare system, like Canada, Scandinavia and the Netherlands. Apart from these countries, experiments are also taking place in Brazil and India.

New experiments

In the Dutch town of Utrecht (and three other towns) an experiment began in 2017 in which several hundred unemployed people who receive social benefits would be relieved of their duties to apply for jobs and to report to labour department of the town. They received the same money as before. In 2017 and 2018 Dutch researchers will follow them to see if they become more healthy and happy, have less debts, become more active and find their way back to the labour marked more easily. Another part of the experiment is to monitor the costs of the local labour office in taking care of them.

At the same time a similar pilot project with 2000 unemployed people started in Finland. They will receive every month 560 euros – about £480 pounds sterling, or US$ 600 – (the minimum social benefit) during two years. They will keep their additional benefits and are allowed to take a job without losing the 560 euros.

The Finnish government hopes that at least 30% of the participants will find a job in these two years. Another stated goal is the reduction of the bureaucratic costs.

Proponents and opponents

If existing restrictions and duties will be removed for all people who receive social benefits, we may expect a reduction of bureaucracy, but what it will mean for the unemployed themselves and for their motivation to work is still not clear. The proponents of the basic income are not satisfied with this first step that only involves the unemployed. They want its general introduction, for everybody. One of their arguments is that in the near future the automatization and robotization of labour will lead to a society in which full employment is no longer possible. There will be forced unemployment for the masses, whose buying power can only be maintained by a basic income, in a more efficient way than through the costly welfare bureaucracy. We may call this welfare substitution.

Among the economists and social scientists there is no consensus on the effect of a large-scale introduction of a basic income for everybody. Many of them consider the costs of a basic income too high. It is also thought that people will be less motivated to work and that for some jobs nobody may apply anymore unless the wages for them are raised. It all depends on the level of the basic income.

The unconditional basic income

It was in 2005 that the very successful German business leader Götz Werner created a sensation in the press with his appeal for an unconditional basic income for everybody. His arguments were not only economic and social, but also, for him, moral. His thoughts and arguments are underpinned by a spiritual perspective inspired by what he has experienced and understood through anthroposophy. He gives a vision of a society in which people will receive 1500 euros (1300 British pounds sterling) every month and have no more concerns and fears about their survival in modern life.

Werner made a realistic calculation: following a proposal made by Rudolf Steiner, the founder of the anthroposophical movement, a century ago, he proposes to abolish all taxes except the VAT (Value Added Tax, so called in Britain, is a tax added to the cost of goods and services; many other countries also have this kind of tax, sometimes by other names, like ‘Sales Tax', etc.). This should take place in the next 20 years, with regular increases in the level of the basic income and of the VAT, which might rise to 50%. The only reasonable taxation, he argues, can be on consumption, with higher levels for luxury goods. The costs of production would drop because the hidden taxes included in the consumer prices would fall away, the wages would decrease with the amount of the basic income. The huge bureaucratic costs of the welfare system would not be necessary anymore because all social benefits would in the course of time be abolished. In Werner's final calculation, the outcome would be positive and the consumer prices would remain stable.

The separation of labour and income

In the public discussion that arose around Werner's ideas many important questions concerning our ideology of labour, the structure of society and the goals of human life were discussed.
His books and interviews have been read by many thousands of Germans. One of his visionary statements was that the task of the economy is not to employ people but to liberate them from labour, by organizing the production process more efficiently. The goal of the economy, Werner remarked in an interview, is to provide goods and services for customers. And the introduction of a basic income is for him the first step towards the complete separation of labour and income.

Rudolf Steiner had another vision of social change and the organization of economic life. For him, economy is not about free money for everybody, but about a new consciousness that as human beings we have needs that can only be satisfied by others who are willing to work for us. Labour is ultimately a service to others. In Steiner's view, working for our fellow humans being and earning a certain income were two distinct issues. Ideally, income should not be the motive for the work we do. We should receive our income as a share of the common value we create in a company, according to our contribution to it, within the lower and upper income limits determined in parliament. For those who do not work in a business organization, a law should determine the way their contribution is estimated, also within income limits.

From this point of view talking about a basic income only makes sense if our consciousness awakens to the fact that others are needed to create this income for us through work and that we are also called to take our share for the sake of a basic income of others.

A vision for the future

What a new society based upon these ideas could look like in practice has been dealt with in many different ways by people who are inspired by the thoughts of Rudolf Steiner. Behind his ideas lies a vision of a future in which we do not work for ourselves anymore but for the wellbeing of humanity. The Bulgarian spiritual teacher Peter Deunov (1864-1944) remarked in 1944 that in the future we will receive what we need from the community in which we live. He predicted that first of all, bread will be given for free to everybody on earth. In this way bread and other healthy food could become the first substance of a global basic income. Other basic needs could be provided later.

To achieve this, the structure of our global society has to change completely. The introduction of a basic income might be a first contribution to this change. It would, at any rate, certainly liberate us from the thick forest of bureaucratic welfare arrangements with their restrictions, rules and control mechanisms, and give us the right to receive the money we need to lead a normal human life on a basic level.

The discussion on the basic income shows that our consciousness needs to transcend the ideological barrier that we only work for ourselves. We need more consciousness raising experiments with limited forms of a basic income, otherwise it is only a welfare substitution that cuts down bureaucratic costs.

Harrie Salman lives in Holland and is an itinerant teacher of philosophy and researcher in the areas of cultural history, social development and spirituality.

First publication in New View magazine, Issue 83, April-June 2017 (www.newview.org.uk)