Somebody’s poking their stick into my cage again. Again with the UBI? Really?? Today it’s Matt Bruenig at Demos. Matt & Demos do good work. I’ll probably talk about it some time. Meanwhile, Matt suggests that social insurance needs its own insurance back-up, namely a UBI.
It is quite true that social insurance does not cover every curve that life can throw at you. It isn’t supposed to. It’s mainly insurance against the possible deprivation of labor earnings, which is what most people depend on to live. Loss of earnings in old age, in disability, in death, due to injury on the job. Even from that narrower standpoint, there are still some big holes in it. For one, with no work history you may not qualify for any benefits, even though you are unable to work. As Matt points out in the case of unemployment insurance, even if you fall into the category of nominally eligible, circumstances can conspire against you.
Another big hole that will be dawning on the U.S. before long is the lack of coverage for long-term care. If you don’t know anyone who has gotten very ill, you might not know that health insurance and Medicare only apply to the services of medical providers — doctors, hospitals, drugs, some medical supplies. You could have a chronic condition that prevents you from being able to take basic care of yourself — dress, bathe, go to the bathroom, eat, etc. In insurance lingo, they’re called “activities of daily living.” You might need 24-7 care. You might need somebody to tend to IVs every day, or change bandage dressings. There is scant help for that under health insurance or Medicare. If you don’t mind spending all your money, you could get onto Medicaid and go into a nursing home. Probably not a great nursing home. A nursing home that provides a few skilled nursing services that you may need can be hard to find. I know; I’ve been there. Social Security Disability Insurance can replace some lost wages, for those who qualify, but it isn’t enough to pay for 24-7 nursing care, even unskilled care. Unless you have very good luck with employers providing group coverage, long-term care insurance can be prohibitively expensive.
So there is no question that social insurance is not the end of what an ample welfare state should provide. The question is, is the UBI the most logical supplement to social insurance? I would say no.
Would you say $10,000 is an adequate UBI? If you would, then the cost for the U.S. is upwards of $3 trillion-with-a-T. As I’ve noted in the past, this exceeds the entirety of Federal revenue expected next year. How would any UBI — you tell me for how much — fit together with the rest of the safety net? What would go and what would stay?
I too would like to attack the deprivation remaining after our social insurance programs do all they can. How to do this? I’ll have to repeat myself at this point. My exceptions to the UBI are pragmatic and political. I’m looking for more likely ways to skin that same cat.
One channel is to socialize services that are both central needs of those left behind by social insurance and desired by everyone. So universal pre-K, subsidized child care, community walk-in health clinics, drug treatment, free public transportation. Not all of these are logically national programs. We have over 90,000 local governments with a role to play as well. The key principle is that collective consumption — public goods — can be more economical than individually-purchased services for the same purpose. Make your own list! Dream big. It’s fun.
People will still need cold cash. People want to buy their own damn groceries. Food, clothing, and shelter. So we will need some kind of public assistance too. Why not a UBI?
A politically-acceptable UBI would be too low. (See $3 trillion, above.) It’s true that universal benefits are more popular than targeted ones, but that’s a bit of a circular assertion. You only get universal benefits if the idea is popular in the first place, notwithstanding the inordinate expense. Most people will be able to compare their financial well-being if they receive a UBI but also pay the taxes to finance it. Many will not be enthused by this knowledge.
I agree with Matt that a safety net of some type, but not necessarily a UBI, complements social insurance. I’ve mentioned before that the politics of means-tested or unconditional benefits might be easier with adequate social insurance for everyone else. My political antennae tell me Il Manifesto is the correct line. I’d say the case for a UBI depends on specifying some of the pesky details and then laying out a political scenario wherein the scheme could come to fruition. In a country where thirty percent of the population can’t decide whether Obama is a Muslim or an extra-terrestrial lizard.
If I start arguing with Twitter, my life would be near forfeit, but to the notion that the U.S. could do what Alaska does, I’d note that the total profits of the big five oil companies is reported as $93 billion. Remember trillion-with-a-T? Suppose Michael Moore led a revolutionary uprising and nationalized the oil, with zero compensation to the owners, which includes some of you and your paltry IRA accounts. $93 billion would be one piss-poor UBI.
This is an ancient problem. If it were as simple as a UBI, it would have been solved long ago.