May 29, 2017

Universal Basic Income panics redistribution profiteers. OECD’s model insists on these targeting better the poor.

Sir, Chris Giles writes: “The modeling exercise by the OECD, the Paris-based organization of mainly rich nations that specializes in cross-national comparisons of policy ideas… shows the simplicity of basic income schemes would come at the cost of a need for increases in taxation, less effective targeting of support on the poorest and large numbers of gainers and losers.” “Basic income ‘would fail to reduce poverty’” May 29.

What can I say? The study is full of self-serving premises like “the right to a basic income would undermine the incentives to work because it would ‘sever links between carefully balanced rights and responsibilities of job seekers’”. There it completely ignores the role of UBI in helping the unemployed, without creating any stigma, to get out of bed in order to capture whatever temp opportunities there might exist in a job market characterized by more and more structural unemployment.

Also when the report concludes, “Large tax-revenue changes are needed to finance a basic income at meaningful levels,” any savings of redistribution costs are clearly ignored, and the “meaningful level for a basic income” is undefined.

Sir, this is clearly a case of redistribution profiteers defending the value of their franchise. That is only to be expected.