A high-profile report out of B.C. recently concluded a universal basic income was not the best strategy for poverty reduction. Economist Armine Yalnizyan agrees, saying the solution is broader than merely addressing inadequate incomes. Economist Evelyn Forget disagrees, arguing it has the power to transform society as medicare has in Canada.
If you care about making life better for everyone, don’t focus on basic income. That’s the welcome conclusion of a long-awaited report to the B.C. government, which in 2018 asked about the viability of a basic income approach to poverty reduction.
In case you think the report’s authors have a black hole where their heart should be, take a look at the remarkable work led by David Green, Rhys Kesselman and Lindsay Tedds, and tell me if you’ve read a more soulful purpose-setting introduction. At 529 pages, and with 40 background papers, it’s also one of the most thoughtful approaches to fact-finding and technically thorough methodology possible.
Having worked with the Canadian community of antipoverty activists and academics since 1987, I see this report as the atlas for the journey ahead, on the road to lifting all of society by improving the lives of the most vulnerable. It doesn’t just reduce poverty reduction to a story about inadequate incomes. It covers the basics everyone needs — income, services, and rules that provide both self-respect and social respect.
The report said no to a basic income pilot and yes to lasting change. This is important. By definition, not everyone is included in a pilot. But no basic income pilot of any significant size has lasted. Neither Ontario’s 2017 pilot nor Manitoba’s 1974-1979 pilot survived a change in government. Finland’s two-year pilot ended in 2018 and Netherlands’ in 2019; Brazil’s Bolsa Familial is on life support. The list goes on.
The enduring example some advocates point to in Alaska is also a cautionary tale: since 1982, royalties from oil provide annual dividends of $1,000 to $2,000 to all citizens. That’s no one’s idea of a basic income.
The ardour of the “why not just cut everyone a $2,000 cheque each month” crowd understandably grew after the surprisingly rapid implementation of CERB, a new form of monthly federal income support designed to limit contagion. But B.C.’s report shows a much bigger bang for our buck is available. Its recommendations come with a $3.5 to $5 billion price-tag for B.C., a fraction of the cost of a basic income program that lifts people to, but not over, the poverty line.
Along with one resounding “no” to basic income, the report offers 65 “yes”es. Here are a few:
- Yes to more income: Today’s punitive benefit levels are wholly inadequate, the result of slashing welfare rates (and jobless benefits) back in the 1990s. Raise them. Low-income workers living in high-rent cities like Vancouver and Toronto commonly spend more than half of their earned incomes on shelter. Consider a housing benefit.
- Even More Yes to more supports: People living with disabilities, youth aging out of care, and those fleeing domestic violence, and the working poor all need more cash but also more mental health care, dental and vision care, pharmacare and physiotherapy, housing, child care, equipment to assist those living with disabilities, internet access, legal aid, transit. These basics can’t be covered by a basic income, but they make or break lives. Improve their access.
- Yes to more simplicity: More people would get support with automatic tax filing and linked administrative data. We already have basic incomes for the elderly (Guaranteed Income Supplement) and children (Canada Child Benefit). For the working aged population, there is the GST credit and the Canada Workers Benefit. But people may not know what’s available to them, or can’t get help because they are “off-grid” (ex. the homeless, some people with disabilities, newcomers, undocumented residents). So …
- Yes to better outreach and better rules: People fall between the cracks due to ineligibility (the case even with CERB or a basic income). Also, with the exception of social assistance, most income support systems depend on the tax system. But the people who most need help a) may not be in the tax system or b) have urgent requirements arising from rapid changes to life circumstances. They can’t wait for next tax year’s filings. More simplicity will mean fewer rules, but not no rules. Outreach and help navigating the rules makes all systems function better.
- Yes to better rules in the labour market: We urgently need better labour standards (like improved minimum wage, paid sick days, pro-rated benefits for part-timers), fewer exemptions and more vigorous enforcement. Employment Insurance, last reformed in the early 1990s, also needs an overhaul. As the pandemic so brutally showed, it has lost its ability to stabilize purchasing power and prevent erosion of the middle class when people lose their jobs.
It takes more than just incomes to deal with the messy, unending process of seeking a more just society, where people see each other as equal, respected partners. As the saying goes, it takes a village to raise a child. We lose the village when the answer to every individual cry for help is “the cheque’s in the mail.”
Basic income, in Canada, has come to mean an income-tested benefit — a guaranteed income close to the poverty line for those with no other income and a reduced benefit for low-income workers.
Basic income does not replace public services like health care and supports for people with disabilities. It streamlines and enhances cash transfers.
The benefits of basic income have been documented in multiple studies. Mental and physical health improves. People invest in education. There is no evidence that overall work effort declines when a basic income is offered and some evidence that basic income helps people move from precarious work to long-term employment.
Studies remind us that when low-income people have money, they spend it in local communities and create jobs for their neighbours and families, which jumpstarts recovery from pandemic-induced job losses. Basic income allows people to stand up for their rights as workers and tenants without fear of retribution.
Ironically, the strongest arguments in support of basic income appear in a recent report of the B.C. Basic Income Panel that recommends targeted basic incomes for people with disabilities, survivors of domestic violence and kids aging out of foster care but stops short of recommending a basic income for everyone now living in poverty.
There are no fewer than 194 unco-ordinated programs offered by federal, provincial and municipal authorities that offer support, in cash and in kind, to low-income people in B.C. alone — and B.C. is not unique.
Programs have different entry points, eligibility requirements and regulations designed by “experts” who believe they know best, requiring desperate people to navigate complex bureaucracies.
Consequently, many people do not receive the benefits to which they are entitled. This system is so ineffective that tent cities and food banks proliferate and we treat the consequences of poverty in our emergency departments and jails.
The promise of ever more “wraparound care,” coupled with administrative tweaks, must send shivers up the spines of people who know that public services rarely meet their needs — Indigenous mothers with kids in care, Black youths encountering racism at school, women incarcerated for poverty-related crimesand trans and racialized people deprived of culturally appropriate medical care.
The more distant someone is from mainstream culture, the more they need money to address their unique needs in their own way and the more problematic the advice of “experts” becomes.
Indigenous people have been victimized by coercive and ineffective bureaucracies for generations and consequently, the Report of the National Inquiry into Missing and Murdered Indigenous Women recommends a basic income for all Canadians. Basic income was the first call of the Black Lives Matter movement.
Critics point to the implementation challenges of basic income, but the recent CERB delivered a responsive benefit quickly, respectfully and efficiently by relying on individual income reports and verifying afterwards. The glitches in rollout occurred because applicants required $5,000 of (poorly defined) income in the previous 12 months.
A basic income would not be conditional on past earnings and defining income is surely within the capacity of policy-makers. Up-to-date tax returns are not required and people without internet access can reach administrators directly.
Critics exaggerate the costs of a basic income by breathlessly telling us how much it would cost to send a cheque to everyone, rich or poor, each month — an approach virtually no one advocates — but costing exercises on well-designed programs show much lower costs.
Taxpayers are already paying for the hundreds of failing programs that currently exist; is it too much to ask that their contributions be spent effectively?
Basic income requires federal leadership, but Canada has a long tradition of allowing provinces to opt out, with compensation, to establish their own programs as long as they meet federal standards.
A half century ago, ordinary Canadians of diverse backgrounds came together to challenge entrenched interests and the status quo; they demanded universal health care, which transformed our society forever. As Tommy Douglas reminded us, “it’s not too late to build a better world.”
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