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What is Basic Income?

As Switzerland considers paying its people a basic monthly income of SGD3500 (for doing nothing), let’s take a look at the concept of basic income. UPDATE: The Swiss have voted NO to basic income.

What is Basic Income?
A basic income is an income unconditionally granted to all on an individual basis, without means test or work requirement. This means that everybody, rich or poor, employed or unemployed, will get SGD3500 from the government.

Who pays for it?
Quite likely the government. Where do they get the money from? Like with most social programmes, from taxes or reserves.

Why do people want Basic Income? Some arguments include:
- Helps people who have lost their jobs to technology
- Brings people out of poverty
- Allows people to do what they enjoy, thus “rescuing” them from “meaningless jobs” and allowing them to unleash their true potential
- Allow time to do volunteer work

What are the arguments against?
Robots are taking over our jobs is not new — Disruption by technology is not new. This has happened time and again and humans have proved to be resilient.

“In the past, people went through many of these dark days, but always eventually found their way and were rewarded with greater wealth and prosperity.”

If you try to stop market/technological forces at work, you might end up hindering progress.

“If anything, universal basic income could hinder the process in which we figure out the future of work, because it removes the incentive to find a way to make oneself valuable in response to economic shifts.”

It is a poor tool to alleviate poverty — Some proponents of the policy have suggested replacing welfare programmes to fund basic income. But why would the rich need basic income? Wouldn’t that money be more useful for initiatives for the poor?

What bullshit jobs? — There is no such thing as a “bad/meaningless” job.

“The weakest argument for basic income is that we need to rescue people from tedious jobs and unleash their creative potential. This is at best ludicrous and at worst patronizing. Even so-called bullshit jobs matter because they can foster skills and connections. Being good at something meaningful often takes years of experience and learning from crappy jobs.”

Where will the money come from — To fund such a policy, taxes will increase, eventually disadvantaging the lower and lower-middle income earners. Why defund programmes that have successfully helped the poor, to fund basic income for the rich who do not need it?

Singapore’s System
Singapore does not have basic income. Singapore helps lower-income members by topping up their Central Provident Fund (a compulsory comprehensive savings plan for working Singaporeans and permanent residents) through the Workfare Income Supplement (WIS) Scheme and social assistance programmes from the Ministry of Social and Family Development. Singapore also has a Progressive Wage Model, a wage structure advocated by the National Trades Union Congress (NTUC) with the intent to increase the salaries of workers through upgrading of skills and increasing productivity.

The wage structure is mandatory in 3 lowest-paying sectors — cleaning, security and landscaping.

Sources:
Switzerland considers paying people $3,500 monthly income for doing nothing
The universal basic income is a bad idea whose time will never come
Poll finds basic income proposal doomed to fail
A Universal Basic Income Is a Poor Tool to Fight Poverty
One of the World’s Richest Countries Is Voting on Whether to Give All Its Citizens $2,500 Per Month
Resident cleaners see higher salaries with Progressive Wage Model