Shadow chancellor John McDonnell has called universal basic income (UBI) “an idea whose time may well have come”. It means a fixed regular payment to each citizen, irrespective of income or behaviour. It is seen by both socialists and Silicon Valley as a panacea for the post-industrial world, addressing unrestrained inequality, economic insecurity, and automation-generated unemployment in the modern economy.
Guy Standing, a professor at Soas and founding member of Basic Income Earth Network (BIEN), says a “perfect storm of factors have suddenly pushed us into being a mainstream policy question” in recent years. “A lot of people who were sitting on their hands, as it were, have started to come out in favour … I’m inundated with requests to speak and involvement in conferences, and it’s indicative of the sudden realisation that if the growing inequality and growing economic insecurities persist, then the drift to fascist populism will continue.
“Of course, in the background, a lot of these techies including prominent names in Silicon Valley have come out in favour because they see robots displacing us all. I don’t buy that argument, but it’s added to a growing chorus of people saying that we should take it more seriously.”
Standing’s recent book charts the long history of thinking about UBI (through ancient Greece, Thomas More, and Martin Luther King). But the idea’s rise to prominence is the result of a interlinked developments in the economy and the nature of work. As Labour MP Jonathan Reynolds argues, changes such as the rise of self-employment and the gig economy challenge the appropriateness of the traditional welfare state. It’s “based around the principle of compulsion, and broadly believing there’s two binary states – people in work, and people out of work. We know it’s becoming a much more complicated picture than that… The state can’t keep up with the complexity of people’s lives.”
For Standing, the prospects of UBI being implemented successfully depend largely on how it is framed. He is wary of libertarians who see it as an opportunity to dismantle the welfare state, and believes it needs to be placed within the context of chronic economic insecurity for a growing number within the post-industrial economy.
“The argument that I think is going to prove really important for the left is linked to the growth of the ‘precariat’,” he says, meaning those living without predictability or security. “People in the precariat are experiencing chronic insecurity that will not be overcome by any existing policy.”
Even so, support from business could be key. Peter Swenson’s work on the history of the welfare state finds that reforms and expansions of social policy have only succeeded when key sections of the capitalist class are in support. He, and other academics, resist the idea that the welfare state is simply the focal point for the battle between left and right over Robin-Hood style redistribution. If UBI is to make its way into policy, support from business may be more important than the strengthening of the left.
Reynolds claims UBI may solve not just policy problems, but political ones. “You have to say that Labour’s situation, in terms of how we’ve struggled on all of these issues (the party’s polling is significantly behind on running the welfare state) over the last few years, means that we should definitely be open to new thinking in this area.” Both he and Standing are part of the working group that was brought together by McDonnell in February to produce a publication on the issue before the next general election, which would then be discussed across the country. Understandably, the group didn’t quite meet its deadline. But Standing says “the general thrust of the plans hasn’t changed”.
Standing is hopeful that important sections of the Labour Party are either in support, or can be won over. Clearly, the leadership is generally supportive of the idea – both McDonnell and Corbyn have expressed as much in public statements. Standing says many MPs are “rethinking their position … many of them have not taken up a position because they thought that this was not an issue to be considered. I think we’re seeing a real opening for a much more constructive discussion.”
Reynolds says that “there’s people on the right and the left of the party who are in favour, there’s people on the right and the left who are against”.
Nevertheless, discussion is winning over important Labour constituencies. It’s not just radical activist groups, but also trade unions, who are coming round to the idea. According to Standing: “Unite now supports it, as well as a lot of unions in Europe. It used to be the case that the unions were among the most fierce critics of a basic income, on the spurious grounds (in my view) that if people had a basic income they wouldn’t push for higher wages and employers wouldn’t give higher wages.
“We found in our pilots and in our psychological research that people who have basic security have a stronger bargaining position and are therefore more likely to stand up for their rights, and can lead to improvement in wages and working conditions. So I think that all of those objections are gradually being exposed by theoretical arguments against them, or empirical evidence, from pilots.”
Reynolds agrees that “there’s a lot of support coming from the wider labour movement”, but warns that people must not be too optimistic about anything happening quickly. “Clearly it’s going to need a radical change to how the tax and benefits system would work, and you’d obviously be completely recasting how personal allowances work, and all of that,” he says. “I think this is sort of the cutting edge of thinking about the future and what our economy will look like in 50-100 years’ time, that is the frame that we’re looking at.”