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julen bolin
January 16, 2023
Social Justice

A basic income must be financed through a tax reform that takes away from the richest to give to those who have less

The voice fo Julen Bollain, Spanish economist, politician and researcher interviewed by Alessandro Sahebi

Free money, to everyone. A utopia that on Voice Over Foundation we have already chronicled in the words of Indian sociologist Sarath Davala, currently President of Basic Income Earth Network and co-author of the book, 'Basic Income: A Transformative Policy for India'. As soon as one mentions universal basic and unconditional income, that is, a monthly allowance given to all and sundry to be able to lead a decent life, the first question that is asked sounds something like this, "Okay but how much does it cost to do this?"

The question, actually, to be best addressed, should, however, be accompanied by a second question: how much does it cost not to do it?  

The economic question alone does not exist, because economic science is, at its root, a social science. So how much does it cost not to give support to those who no longer have jobs because of automation? How much does it cost to force an individual to commit crime to feed himself (consider social costs, repression, judiciary)? How much do socially gradient mental and physical illnesses, i.e., those that have the highest incidence among the poor, cost?

Universal Basic Income is a macro-economic measure, the effects of which are difficult to predict, so the purely numerical question-that is, the cost-cannot be calculated with an abacus. Any welfare state measure is not just a cost to the community but a social investment that has returns, including economic returns, that are not immediately visible and quantifiable. 

In order to address some thorny issues, we wanted to interview Julen Bollain, a researcher and economist at Mondragon Unibertsitatea University and former parliamentarian in the Basque parliament for Podemos. 

Q: Hi Julen, let's start with an open question: why do you consider Basic Income an urgent and necessary measure? 

A: "Basic Income is not a new measure. However, it is true that in addition to the increase in social inequality that we are experiencing, there are three factors that put citizenship income at the center of the public debate and political agenda. First, the failure of minimum income schemes (such as the Reddito di Cittadinanza in Italy, ed.) to achieve their goal of eradicating poverty. Second, the evolution of the labor market and the uncertainty it generates. And finally, the proliferation of basic income pilots around the world. So, the failure of minimum income schemes, rising inequality and the evolution of the labor market make basic income more urgently needed than ever. Fortunately, with so many pilot projects going on around the world, we have a lot of evidence about the outcomes that a basic income could have."

Q: You mentioned pilot projects, what do you mean? Are there experiences from which, economically speaking, we can take a cue?

A: "There have already been about 200 basic income pilots and experiments around the world. True, some went well and some went worse, but we can learn a lot from all of them and then optimize the new ones that are being planned. Pilot projects on a global scale are difficult to compare - a project in Kenya or one in Finland are very different in context and development - but all experiments have some common features. They improve people's economic well-being, reduce stress levels and mental health problems, increase a sense of belonging to society, and increase - or at least do not reduce - the number of work days per earner. Therefore, the prejudice that sees UBI as a tool to desist from work is easily dismantled. Right now a pilot project is being designed for Catalonia, to be launched in early 2023, which is really very interesting because it involves more than 5,000 citizens from all walks of life. Each of them will receive about 800 euros, health, economic and social indicators will be measured. This is one of the biggest experiments in Europe, which will probably decisively revive the debate." 

Q: The most common theories of UBI (Universal Basic Income) involve processes of wealth redistribution. The most common economic argument against universal income talks about likely capital flight, that is, the rich would flee if we were to raise their taxes. How to respond?

R: "Undoubtedly redistribution is a fundamental pillar. A basic income must be financed through tax reform that takes away from the richest to give to those who have less. Studies on the Renta Basica (the Catalan program planned for 2023) in this regard speak clearly: the richest 20 percent of the population would see their tax burden increase and the remaining 80 percent would benefit. Raise taxes on the rich but we would all be better off, it is not envy but a matter of social justice.

I think the whole society would benefit. Both socially and economically. We cannot forget that societies with greater equality are also the most competitive, economically speaking. Would there be a flight of capital? I doubt it. In Spain the tax burden is six points lower than the European average, and capital does not leave Sweden to come to Spain. Nor, I would say, in Italy, right? Obviously European, if not worldwide, coordination in this regard is desirable. If the rich are running away with resources from the countries where they extracted them, that's part of the problem, not a factor to simply take note of."

Q: From an economic standpoint, do you think basic income can restrain economic growth? If so, should we see it as a disaster or a way out of our unsustainable system?

A: "Rather the opposite. A basic income would make it possible to increase a country's economic growth by improving its productivity and welfare, as the projects show. It would also make it possible to enhance all those unpaid jobs that, since they do not add to GDP, are totally invisible. I am referring to care and domestic work or volunteer work. Basic income would allow us to see that there is a world beyond GDP and that a more supportive society is possible, in which each person can contribute as best they know how without the pressure of need. This is something inevitable in the short term where we will have to rethink our social protection model, partly because of the evolution of the labor market. If there will be no jobs for everyone because of automation, it seems sensible to think that the material existence of citizens should be guaranteed regardless of the labor market. As Pope Francis said recently: "We need a citizenship income so that every person in the world can have access to the most basic necessities of existence"."

Q: Do you think it could improve our environmental impact?

A: "Basic income would be a tool aligned with the goal of addressing the climate crisis because it does not follow the productivist logic of capitalism.

There are several reasons for this, but one that has been observed in several pilot projects is that it provides citizens with economic security and stability that open the door to innovation and true entrepreneurship, strengthening community ties and mutual support. In this way, greater local development is achieved through the creation of cooperatives that enhance the interrelationships of networks among local actors and make more efficient and sustainable use of existing resources in the area. 

A counter-trend to unbridled globalization, one of the causes of the climate crisis we are facing."

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