Basic Income - What is that?

An unconditional basic income (also called universal basic income, basic income guarantee, universal demogrant or citizen’s income) is a form of social security system in which all citizens or residents of a country regularly receive an unconditional sum of money, either from a government or some other public institution, in addition to any income received from elsewhere. Basic income is a universal income grant available to every citizen without any means test or work requirement. Academic discussion of basic income and related policies has been growing in the fields of economics, philosophy, political science, sociology, and public policy over the last few decades.

The idea is not a new one. 1516, exactly 500 years before the Swiss people rejected a referendum on the implementation of a basic income scheme in Switzerland, Sir Thomas More, the former Lord High Chancellor of England, wrote his book "De optimo statu rei publicae deque nova insula Utopia" depicting a fictional society – Utopia literally translates from Greek as “noplace” – where every citizen has an income from state. He commented:

"No penalty on earth will stop people from stealing if it is their only way of getting food. […] It would be far more to the point to provide everyone with some means of livelihood." (Morus, 1518)

In 1526 Juan Luis Vives (*06/03/1493, +06/05/1540), a contemporary of Thomas More, however, was the first to explicitly endorse an early version of BI in his work “De subventione Pauperam” (translates as “On the support of the poor”) which was addressed to the mayor and aldermen of Bruges. Vives idea was in contrast to today’s idea of Basic Income linked to the evidence of the potential recipients’ will to work.

In the centuries after him the idea was picked up several times again. In 1795, American revolutionary Thomas Paine advocated a citizen's dividend to all US citizens:

"We should create in every nation a national fund to pay to every person, when arrived at the age of 21 years, the sum of 15 pounds sterling, to enable him or her to begin the world. And also, 10 pounds sterling per annum during life to every person over the age of 50 years, to enable them to live in old age without wretchedness, and go decently out of the world." (Paine, 1797)

Even Napoleon Bonaparte commented that "man is entitled by birth right to a share of the Earth's produce sufficient to fill the needs of his existence". And one of Martin Luther King's less known ideas was to eradicate poverty by providing every American a guaranteed, middle-class income. He laid out his idea of a guaranteed income 1967 in his final book "Where Do We Go From Here: Chaos or Community?".

Today the idea is discussed all over the world. Large networks built up like the Basic Income Earth Network. National networks in most European countries developed like in Germany "Netzwerk Grundeinkommen" or in Ireland the Basic Income Ireland Network. The European Citizen's Initiative for an Unconditional Basic Income collects signatures for a petition to be delivered to the European Commission.

Economists, Politicians, Sociologists advocate the idea and there is an enduring academic discussion about how to implement a scheme into or instead of the existing social welfare system.

Growing poverty, an ever decreasing middle class and the ever increasing gap between rich and poor suggest that a system of an unconditional basic income may even be cheaper than our soon collapsing social security systems.

Arthur Schopenhauer once described the phases through which new ideas run through during their development and implementation: “New ideas pass through three phases: first they are ridiculed, fought later, and eventually they are self-evident.” At the moment, it appears as if BI belongs again to the current topics of the day. Fierce debates in the media and politics make belief that the idea of BI is currently in Schopenhauer's second phase although one could get the impression as if the last phase is imminent.

While social welfare systems all over the world seem to reach their limits it appears that it may be time to find answers and solutions to these challenges. The need to bring on the way systemic changes in fiscal and social policies that satisfiy the needs of people – not least in view of the impact of globalization – appears obvious. There may be many reasons to advocate BI. Proponents argue that it may eliminate poverty and social inequality, re-define work and increase productivity, it could be a milestone on the way to mankind’s freedom and it may improve democracy. The arguments in favour are almost countless. Such a system change must be based on three premises:

1. The inviolability of human dignity must be guaranteed under all circumstances, that includes the unconditional right to a socio-cultural subsistence.
2. The system must be a market economy, as history shows market economy is the only economic system that not only guarantees freedom but also uses the opportunities of freedom. The fact that performance pays is significant to a market economy system and the fact that it has a market-based economic system, gives evidence of a free society.
3. A solidary and liberal tax and social legislation must be fair. This applies between those living today and between present and future generations. Only a sustainable equitable tax and social security system has a future.

Although the exact cost of a country’s national basic income scheme, of course, would depend on the level of payment but however, the introduction of an unconditional BI would allow a serious streamlining of the state’s administrative apparatus since all previously paid public assistance benefits would be merged into the unconditional BI. The administrative burden on both the state’s side as well as on the taxpayers’ side of could be significantly reduced. The state would thus become significantly more efficient, and the resources thus obtained could be fed to more productive uses.

King, Martin Luther, 1967 Where Do We Go from Here: Chaos or Community? New York: Harper & Row

Martin Luther King, Jr. (*15/01/1929, +04/04/1968) was an American activist, humanitarian and leader in the African-American Civil Rights Movement.

Morus, Thomas, 1518. De optimo reipublicae statu deque nova insula Utopia. 3rd ed. Basel: Frobenius.

Sir Thomas More (*07/02/1478, +06/07/1535) was an English lawyer, social philosopher, statesman and noted Renaissance humanist. He was a councillor to Henry VIII and Lord High Chancellor of England. In 2000 Pope John Paul II declared him the "heavenly Patron of Statesmen and Politicians”. Although More opposed the Protestant Reformation and in particular the theology of Martin Luther, he opposed as well the King's separation from the Catholic Church and after refusing to acknowledge Henry VIII as Supreme Head of the Church of England and taking the Oath of Supremacy he was convicted of treason and beheaded.

Paine, Thomas, 1797. Agrarian Justice. London: Evans and Bone.

Thomas Paine (*09/02/1737, +08/06/1809) was an English-American political activist, philosopher, political theorist, revolutionary and one of the Founding Fathers of the United States of America.

Vives, Juan Luis, 1532. De subventione Pauperum Sive de Humanis Necessitatibus. London: M. & G. Trechtel

Juan Luis Vives (*06/03/1493, +06/05/1540), a contemporary of Thomas More, was a Valencian scholar and humanist who spent most of his adult life in the Southern Netherlands. His beliefs on the soul, insight into early medical practice, and perspective on emotions, memory and learning earned him the title of the "father" of modern psychology. Vives was the first to shed light on some key ideas that established how we perceive psychology today.