The decision to terminate the Basic Income Experiment in Ontario is a sort of finding, too. The design of related experiments has usually been based on short term economic or behavioural effects – because that, after all, is all one can hope to pick up from an experiment for two or three years. However, the arguments around Basic Income, on both sides, are about something different – about social and cultural change. That kind of change can take a generation or more, and it’s simply not going to appear in the way that economists usually model such effects. I’ve previously drawn the parallel with the introduction of old age pensions, where the effects in the UK weren’t fully resolved in sixty years. It’s not possible, more than a hundred years after the introduction of pensions, to be certain what the implications were for older people at the time – and people considering retirement would have been right to be uncertain. The costs of the 1908 scheme led the UK government to threaten retrenchment, and after massive post-war cuts in other services (the “Geddes axe”, applied 1921-22, cut spending worth 10% of GDP), in 1925 pensions were fundamentally reformed to raise money through contributions instead. Most older people were retiring by the 1940s, but many people who were retiring in the 1970s were still deferring their pension claims.
The decision in Ontario comes shortly after a (somewhat less brutal) decision in Finland not to extend their experiments. The message coming over is clear and strong: Basic Income is pushing at the limits of what politicians are prepared to consider.
What does this imply for Basic Income? First, politicians won’t leave Basic Income alone – they just can’t stop themselves from tampering. Look at Child Benefit, which was working really well before the Coalition government decided to create special conditions for wealthy people. If Basic Income comes, it won’t be forever.
Second, there’s no such thing as an unconditional benefit. Issues which may seem relatively minor now, such as the treatment of migrants, prisoners or religious communities, are going to surface eventually. Some of the conditions are more liberal, some are less intrusive, but there will be conditions – tax exemptions to “send a message”, rewards for virtue, or whatever. People advocating for Basic Income have to argue for conditions to be kept to a practical minimum. That’s hard to do when politicians and the press will convert it into “benefits for paedophiles” or “benefits for members of ISIS”, with specific instances. Be prepared.
And that leads to the third point: whatever people use their Basic Income for, they’d be unwise to bank their long-term security or future life-plan on it. How long would it take before the system is so strongly embedded that the future becomes certain? I can’t be sure, but it’s not going to happen in a three year experiment.