Get Off The Couch: The Participation Income

This month, Cato Unbound is hosting a discussion on the libertarian case for a basic income. As readers of this blo–oh, who am I kidding. Anyone who knows me knows I am a libertarian who supports a basic income as an alternative to the current welfare state morass – both on a pragmatic “it’s better than what we got now” stand and on a principled basis. (But then, I am slowly becoming disaffected with the term libertarian anyhow.)

One point that has come up repeatedly on discussions about the lead essays is that a basic income of any form would create a nation of layabouts. After all, the argument goes, if you collect a check just for being a citizen, who would actually work? I think that’s a problematic argument for many reasons, but I just wanted to toss out there one variant that does require some effort on the part of recipients: the Participation Income.

I think it was first proposed by A.B. Atkinson in 1996 – though I don’t really know, I was just Googling things. One such Google result [PDF] gave me the following:

A ‘Participation Income’ would be paid to any individual ‘participating’ in society. The list of ‘participations’ would include employment or self-employment, retirement, absence from work because of sickness or injury, inability to work because of disability, and approved forms of voluntary activity. Students, trainees, those caring for dependents (the young, the elderly, or disabled dependents), and those unemployed but available for work, would also be counted as ‘participating’.

So basically, you have to do something in order to get the basic income, but it doesn’t necessarily have to be paying work. Studying, taking care of the elderly or children, volunteering – these all count. (Dunno about the last one in the above quote, though.) I don’t know if this would meet critics’ standards, but at the very least it would require that something be put back into society, something productive happening, in order to receive benefits.

Personally, I can see issues with this. How do we determine who is “participating”? Who will determine and how will they determine what counts as eligible participation? It’s yet another battlefield ripe for political combat, with all the terribleness, shrill partisanship, and uncomfortable silences at the dinner table that come with it. It also seems to be pretty invasive, as I am sure people will demand more accountability than simply trusting the applicant that they have participated. But then again, we have W-2 forms, so something along those lines may suffice.

To be honest, though, I’m not terribly worried about a basic income (or my preferred form, a Negative Income Tax) turning America into a nation of layabouts. We sort of have that problem already, for starters (though it isn’t as bad as some conservatives may think), and furthermore, life without work is not at all pleasant. People need work to have meaning in their lives; without it, many grow unhappy and listless. (I know, I’ve been there.) People are constantly trying to do and make new things – sure, not everybody, but look at all the various projects on Kickstarter, or volunteering activities, or new code developments made when somebody was out of work. I think if people knew there was something like a basic income to catch them if they fell, they wouldn’t just stop doing things and collect a check – they might take some risks to develop a new product or company, knowing they have something there if they fail. How many of us want to do something like that, be an entrepreneuer, but are afraid that if we screw up our families will be living on the sidewalk?

In short, I don’t think everyone will stop working. One commentator, Martin Brock (no idea if that’s his real name, as it’s only Disqus), however, does make one comment that I thought was pretty insightful:

I don’t fear a nation of layabouts. I fear a nation of actors, musicians, painters, novelists, astronomers, photographers, videographers, philosophers, talk radio hosts and political opinion bloggers all producing vastly more drama, music, art and the rest than other people actually want to consume while trying to consume the dwindling supply of goods no longer produced by all of these actors, musicians and painters.

Some of these people might be wondrously “productive”, in the sense of laboring conscientiously to produce lots of wonderful stuff, but if this stuff has little market value, because so many people produce so much of it, the people are not so “productive” in the economic sense.

The world is full of starving artists without a UBI, so I can only imagine vastly more artists producing far less than the cost of their maintenance with a UBI.

Yeah, that actually might be a problem. I know I would happily go off into my room and write science fiction all the time if I had a basic income. The question is, how many Americans would do that? Seeing the multitude of posts on social media, I would be willing to bet a lot (though many would be painters, sculptors, audio remixers, etc.) who then wouldn’t be producing other things. This would probably put a lot more strain on the rest of the economy – i.e, on all the other people producing things – and it might even threaten the very same basic income because at some point we wouldn’t be able to fund it.

But not doing anything? Sure, there are some indolent Americans. Hell, there are maybe a lot of indolent Americans. But there aren’t that many who would stop doing anything except collect a check. More likely, they would take that check and go do something with it.

I also just want to say that I’m not ignoring the public choice considerations here. It’s very likely that any variation on a basic income plan to replace welfare and the minimum wage and reform the tax system that goes before Congress will be butchered and mutiliated horribly. It’s in the nature (and interests) of legislators to craft legislation benefitting their benefactors, and I am sure that one interest group or another will try to bust it or just add it on top of the current welfare morass. But just because that’s a possibility doesn’t mean we shouldn’t try to reform the system by proposing this. If such considerations were to stop policy proposals before they began, then libertarians could never work on public policy — and I find that a very silly position to take.