5 Questions on universal basic income as answered by Guy Verhofstadt, former Belgian PM and European Parliamentary Representative.
"What is your definition of universal basic income?"
Well, it guarantees that all the citizens of a community of a country and a continent, Europe, for example, get a basic income. This can be an amount given to every citizen, which can replace some parts of the actual social security. Universal basic income will make things easier as a social policy than the current way of handling social security benefits. What I think is key is that in our future society, such a basic universal basic income can be more effective than the social security benefits we have today.
"What do you mean by more effective?"
What is more effective is that today, you must respond to several conditions before benefiting from social security. In a universal basic income, that's not the case; that means that poverty can be better tackled with the universal basic income than with a complex range of benefits belonging to social security. It doesn't mean that the universal basic income can replace all social security benefits, such as everything concerning health and hospitals, that will continue to exist. But, I think that there are today many people who live in poverty and will finally have no access to social security benefits because of the conditions these benefits require. So, I think that with a universal basic income, you can better tackle poverty, and these people today, in most cases, have to live with nothing at all. Secondly, I think it will give me or have a universal basic income because we will live in a digital world with more robots, maybe? In. Society, I think enormous profits will be generated by these digital instruments by these robots. So, I think a universal basic income is a good way to create a flow of income of these profits towards the ordinary citizens so that not only the wealthy people increase their revenue and income.
"What are the main obstacles blocking the Universal Basic Income from being Implemented today?"
First of all, because many politicians are used to social security as it works now. They are very conservative, and they are not so keen to go in the direction of a universal basic income. Partly because they don't know it, they still stick to what they know. You know what social security currently is. I have experienced that because it's already over 30 years since I proposed a universal basic income in Belgian politics. But this was a long time ago; the name that I gave it was a negative income tax. So, the idea was that you pay your taxes, but when you have an income below a certain level, you don't pay taxes. Then, you receive subsidies from the state. That was the idea: negative income tax, so you receive them instead of paying taxes. It was not a big success when we started to discuss that in Belgian politics, maybe also because of the name used: Negative Income Tax. People laughed at me and said, "We already paid ordinary income taxes. Why do you have to create negative income taxes? Taxes are already negative. So, the wording was certainly not perfect, but it was an idea discussed 30 years ago. At that moment, the idea was: 'Is this not a simpler way to do so?'
I still have, here in my office, maybe, but certainly at home, hundreds and hundreds of pages about that. Also, a whole document that we published. I was a young leader for the liberal party then, but it has returned. Now, there is a discussion. Maybe there is more reason for introducing a universal basic income today than it was, for example, 30 years ago. The fact that a country like Finland is now experimenting with that. Some individual states in the US are also experimenting with that. It's proof of the fact that a breakthrough may be possible.
"Do you think it should be distributed in normal capital or as a form of consumer credit? Is it also possible that you can only spend it on certain categories?"
No, I would do it as an income that you receive monthly or something like that. When we talk about capital, I think that's another story. That's not universal basic income. What you need besides universal basic income is certainly also to popularize more venture capital, or maybe the public authorities also have to play a role in this. To transfer some public money as venture capital to starting companies, smaller companies. But that's, in my opinion, a different story than the story of a universal basic income.
"Would you give people a fixed amount of money? You could establish a universal basic income by saying you get x euros of consumer credits to buy food, electricity, and something else. This is a basic, general idea, but what do you think?"
What they are experimenting with this for the moment in Finland, I think, is the amount that people receive to spend on these consumer goods that you're mentioning. I think the amount is around 600 euros. The first results are positive. People say introducing universal basic income will make people no longer look for work. They didn't find real evidence of that in the first results of their universal basic income in Finland; on the contrary, there is a possibility for young people and older people to organize their lives differently. Concentrate not only on work but also on other creative activities. That normally would not happen if you don't have a universal basic income. So, I think it will still be necessary for everybody to work. But, I think it makes more sense in a society with a lot of robotization and digitalization to use a bigger part of our time for other creative activities than only work.
"So basically, it's about making sure that people can buy food, preferably healthy food, can buy electricity, and then they can spend the rest of their time doing more value-added and creative activities?"
Exactly, and on the other hand, I think it's, like I said at the beginning of the interview, a good instrument to tackle poverty. If you look at social security today, you can see that it still has a Mattheus effect. It means that rich people become richer because of social security, and people who live in poverty don't receive enough from social security. That's what we call the Mattheus effect, and that's still a problem; many wealthy people receive social security benefits, which are unnecessary for them. People who live in poverty and who don't know how to deal with it don't receive anything. So, universal basic income is also a way to tackle that problem. It's not only a way to look to the new society that will be established in the coming decades with maybe less work and more time for creativity, but it's also a way to tackle injustice in our society.