The most universal benefit of them all

While the UK debates ending universality, economists in America are talking about making income itself universal.

With Labour's decision to push for the end of winter fuel payments for all, Britain has seen yet another step against the principle of universality in benefits this week. But while the tide here is pushing more and more in favour of means-testing every intervention possible, in the US, the opposite debate is being had: should even the largest interventions be universal?

In early May, Mike Konczal wrote an article in the Washington Post proposing a universal basic income (UBI), also called a "citizen's income". The idea is that significant proportions of the social insurance system get replaced with a "poverty-level" income which is given to all, universally and unconditionally. So rather than claiming unemployment benefit when out of work, disability benefit when sick, or a state pension in retirement, you claim a standard sum every month from the age of majority to your death, regardless of your status.

Many of the benefits of a UBI are the same as the benefits of universalising any part of the welfare system: it massively reduces bureaucracy at all stages; it's far easier to get benefits where they need to go; and it removes the stigma of claiming help from the state. For some benefits, even one of those arguments is enough to justify universalising them. So, for example, we don't means test the NHS – among other reasons – because the thought of keeping someone in the emergency room while we check their past six months of payslips is anathema to most people.

But the UBI carries its own additional upsides, by virtue of being so large compared to other benefits. The most important one is that its universality reduces so-called "income traps", points in the tax-and-benefit system where the marginal value of every pound earned drops too low. So, for example, as your earnings rise, you may find that you leave the personal tax allowance, lose working tax credits, and become ineligible for housing benefit all around the same time. That could mean that a job which pays thousands of pounds leads to a take-home pay rise of a tenth of that, giving you a serious incentive not to take it at all.

That problem is also what the Universal Credit is aimed at solving in Britain; but despite the name, it's not a universal benefit, and so it can at best smooth over the problems caused by withdrawal, rather than remove them already.

But Konczal's most interesting point is that there are strong right-wing – or, more accurately, libertarian-right – arguments for a UBI. By removing conditionality of benefits, it also removes a method of state control. It is no longer up to the government, for instance, to determine which types of work experience you can do while still being paid unemployment benefit; nor can they shape society by deciding which types of non-labour activities ought be rewarded – carers, community gardeners, political activist or artists all get the UBI without having to prove their worth.

In fact, as Konczal points out, it's the left which should really be wariest of arguments for a UBI. It has the potential to extend market logic to every reach of society, by equating "being a citizen" with "being paid". That's exactly the sort of thinking Michael Sandel warned against when I spoke to him last month, because, in his words, it "may crowd out attitudes and norms, non-market values, worth caring about".

Konczal's piece sparked a wide debate in the economics community. Despite his strong argument that a UBI ought to be a libertarian idea, many of them opposed it, arguing that handing out a UBI would mean that people would never work, and the government would instantly lose the tax revenue it takes to pay it in the first place.

That argument doesn't quite work; in fact, the understanding as to why that is was the great breakthrough in 19th century economics, the marginal revolution. People tend to make their decisions, not based on absolute levels, but on marginal changes. If you are given a UBI, then you still face the choice as to whether or not to go to work and earn an extra sum of money. And since people working on poverty pay don't tend to decide never to increase their income, it seems likely that a UBI wouldn't discourage much work.

But it would discourage some, because that's the point of it. By removing the link between "having to work" and "starving to death", a UBI would promote a healthier attitude to work, removing the element of fear which forces employees to sell their labour to exploitative employers. Instead, work would occur based on equitable negotiation: if the employee no longer lives in fear that they will be on the streets without a job, their bargaining position is greatly improved.

In the end, it's that outcome which will mean the UBI can never truly catch on among right-wingers – or even the centre-left – leaving the Green Party the only one in the UK to support it. In radically redistributing economic power from capital to labour, it is anathema to the conventional order . That is true despite the fact that elements of it ought to be hugely appealing to people from across the political spectrum. It is freedom-enhancing, bureaucracy-reducing, and in some cases life-saving, but it's also going to remain no more than a thought experiment. That's a crying shame.

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Leader: Boris Johnson, a liar and a charlatan

The Foreign Secretary demeans a great office of state with his carelessness and posturing. 

Boris Johnson is a liar, a charlatan and a narcissist. In 1988, when he was a reporter at the Times, he fabricated a quotation from his godfather, an eminent historian, which duly appeared in a news story on the front page. He was sacked. (We might pause here to acknowledge the advantage to a young journalist of having a godfather whose opinions were deemed worthy of appearing in a national newspaper.) Three decades later, his character has not improved.

On 17 September, Mr Johnson wrote a lengthy, hyperbolic article for the Daily Telegraph laying out his “vision” for Brexit – in terms calculated to provoke and undermine the Prime Minister (who was scheduled to give a speech on Brexit in Florence, Italy, as we went to press). Extracts of his “article”, which reads more like a speech, appeared while a terror suspect was on the loose and the country’s threat level was at “critical”, leading the Scottish Conservative leader, Ruth Davidson, to remark: “On the day of a terror attack where Britons were maimed, just hours after the threat level is raised, our only thoughts should be on service.”

Three other facets of this story are noteworthy. First, the article was published alongside other pieces echoing and praising its conclusions, indicating that the Telegraph is now operating as a subsidiary of the Johnson for PM campaign. Second, Theresa May did not respond by immediately sacking her disloyal Foreign Secretary – a measure of how much the botched election campaign has weakened her authority. Finally, it is remarkable that Mr Johnson’s article repeated the most egregious – and most effective – lie of the EU referendum campaign. “Once we have settled our accounts, we will take back control of roughly £350m per week,” the Foreign Secretary claimed. “It would be a fine thing, as many of us have pointed out, if a lot of that money went on the NHS.”

This was the promise of Brexit laid out by the official Vote Leave team: we send £350m to Brussels, and after leaving the EU, that money can be spent on public services. Yet the £350m figure includes the rebate secured by Margaret Thatcher – so just under a third of the sum never leaves the country. Also, any plausible deal will involve paying significant amounts to the EU budget in return for continued participation in science and security agreements. To continue to invoke this figure is shameless. That is not a partisan sentiment: the head of the UK Statistics Authority, Sir David Norgrove, denounced Mr Johnson’s “clear misuse of official statistics”.

In the days that followed, the chief strategist of Vote Leave, Dominic Cummings – who, as Simon Heffer writes in this week's New Statesman, is widely suspected of involvement in Mr Johnson’s article – added his voice. Brexit was a “shambles” so far, he claimed, because of the ineptitude of the civil service and the government’s decision to invoke Article 50 before outlining its own detailed demands.

There is a fine Yiddish word to describe this – chutzpah. Mr Johnson, like all the other senior members of Vote Leave in parliament, voted to trigger Article 50 in March. If he and his allies had concerns about this process, the time to speak up was then.

It has been clear for some time that Mr Johnson has no ideological attachment to Brexit. (During the referendum campaign, he wrote articles arguing both the Leave and Remain case, before deciding which one to publish – in the Telegraph, naturally.) However, every day brings fresh evidence that he and his allies are not interested in the tough, detailed negotiations required for such an epic undertaking. They will brush aside any concerns about our readiness for such a huge challenge by insisting that Brexit would be a success if only they were in charge of it.

This is unlikely. Constant reports emerge of how lightly Mr Johnson treats his current role. At a summit aiming to tackle the grotesque humanitarian crisis in Yemen, he is said to have astounded diplomats by joking: “With friends like these, who needs Yemenis?” The Foreign Secretary demeans a great office of state with his carelessness and posturing. By extension, he demeans our politics. 

This article first appeared in the 21 September 2017 issue of the New Statesman, The revenge of the left