Arguments for a UBI – The Socialist
This post is part of the sequence Arguments for a Universal Basic Income.
A Robust Safety Net
One of the main issues with social safety nets as they stand currently is known as the “Poverty Trap”. This is the phenomenon whereby benefits are curtailed when someone finds a job, in such a way that they are worse off than before. This can happen in several different ways – either the reduction in benefits occurs at the same rate or faster than the increase in job related income, meaning that the additional time (and opportunity cost) spent working has either zero or negative net effect on income. Alternatively, some benefits are removed entirely when a job is found, which is detrimental when that job is part time or a “zero-hours contract”, again resulting in a lower income than before. This kind of benefit structure actively discourages people to find jobs, as unless they are able to walk into a reasonably paid, full time position, they are better off unemployed. This then means that unless they can weather a period of even lower financial security, they are not able to gain work experience to enable them to seek better jobs.
Clearly operating a financial safety net in this way does discourage people to find new work, however a guaranteed income which does not drop off when income is earned, does not fall into this trap – every extra bit of income earned has a net positive effect on their living situation and finances. The argument could be made that being able to survive off a Universal Basic Income, that had no requirements attached regarding proving that you are seeking work, might still discourage people to find new work, but this denies the tendency of people to desire to improve their position. There will undoubtedly be some people that are content with a small but adequate income, allowing them to survive but little else, however most people aim for more – more comfort, more interest, more hobbies or more education.
The requirement in current systems to prove that you are seeking work is perhaps well intentioned, but ultimately a misguided and bureaucratic solution to the issue of unemployment. More time and effort are required to satisfy these conditions, than would be required to simply look for a job, and the risk of losing this benefit, if these conditions are not met is a constant concern for people in this situation. This can lead to anxiety and mental health issues, as well as people that fall through the gaps either through an inability to fill out the paperwork correctly, or through not meeting a particular eligibility requirement.
The problem of people falling through gaps in the safety net is a very serious one – one example of a well-intentioned but poorly thought out eligibility requirement is that people not be “voluntarily homeless”, to avoid people in shared accommodation exploiting the system to be able to get “their own place”. The issue here is when someone (often teenagers) is in a difficult home situation, they may choose to leave for their own safety or sanity. If they chose to leave, and were not thrown out of the house however, they are deemed to be “voluntarily homeless”, and therefore are ineligible for assistance with housing. This can lead to people remaining in dangerous home situations, when they would be better off leaving, ultimately putting themselves in danger because of their lack of financial independence. It could be argued that there exist shelters for some victims of domestic violence, which should allow people to escape these situations, however these are a stop-gap measure that cannot be relied upon by everyone (many do not admit young men), and still do not resolve the person’s issue of financial dependence.
The inability to successfully navigate the bureaucracy is another serious gap which many people can fall foul of. Even if support is provided to people that are unable to read, have hearing difficulty or have difficulty understanding the forms required, this support suffers from mixed motivation – ensuring that people don’t get money that don’t meet the criteria, whilst helping people to express the criteria that they have met. These diametrically opposed objectives will inevitably conflict, and either lead to accusations that support staff are “helping people to cheat the system”, or that they are “exploiting the vulnerable to cut costs”. By cutting out assessment, and providing a Universal Basic Income to every citizen regardless of employment status or job-seeking activity, it removes this bureaucracy, thus avoiding this conflict. This ensures that regardless of the specific nuances surrounding a person’s financial distress, the safety net is guaranteed to function, and not miss a single person in need.