Switzerland voted to decisively defeat the institution of UBI. TechCrunch reports on the failure and a proposal on funding the failed initiative:
The people of Switzerland have rejected a proposal to give a universal basic income (UBI) to every citizen, with almost 77 per cent saying ‘no’ vs 23 per cent in favor. …
The obvious question for any universal basic income is how to fund it, with critics suggesting large tax hikes would be required. In the Swiss example authorities had estimated the costs of funding the proposal at an additional 25 billion francs, according to AFP.
However the Swiss non-profit behind the referendum believes funding could easily be achieved by placing a micro-tax on all electronic transactions.
Given there are some 100,000 billion Swiss francs worth of electronic transactions annually in Switzerland, a tax that takes 0.2 per cent would generate 200 billion; more than enough to fund the basic income proposal — and more than enough to replace all other taxes, according to Marc Chesney, a professor at the University of Zurich, who was interviewed by Bien-CH (in the below video [go to the link if you wish to see the video – Hue]) ahead of the referendum vote.
SWI (swissinfo.ch) has a nifty interactive map of the vote. Business Insider supplies some of the Swiss political wisdom on the subject prior to the vote:
politicians in Switzerland have described the ballot measure using language like “cocked hand grenade that threatens to tear the whole system to pieces” and “the most dangerous and harmful initiative that has ever been submitted.”
One liberal party politician called it a “bomb in the heart of our society and our economy.”
The UK’s Independent supplies one more – perhaps more pertinent:
A key argument believed to be swaying voters had been put forward by the right-wing Swiss People’s Party (SVP) that the UBI will cause widescale immigration due to Switzerland’s agreement to the free movement of people with all 28 EU member states.
SVP spokeswoman Luis Stamm told the BBC: “Theoretically if Switzerland were an island [basic income] would be possible.
“You could cut down on existing social payments and instead pay a certain amount of money to every individual.
“But with open borders it’s a total impossibility. If you would offer every individual a Swiss amount of money you would have billions of people who would try to move into Switzerland.”
James Pethokoukis of the American Enterprise Institute manages to get his feet on both sides of the question:
Finland and the Netherlands are planning limited experiments, as is the American startup accelerator Y Combinator. If you believe automation fears have driven renewed interest in the basic income, then the idea should have some staying power. It has proponents both on the left (“Yay, redistribution!”) and the right (“Yay, no more intrusive welfare state!”). In that way, the basic income has an edge over another policy also offering an appealing elegance and simplicity, at least in theory: the flat tax. Then again, the basic income also has opponents on the left and right.
But as I recently wrote in The Week, the basic income is a disruptive and risky policy choice lacking a truly compelling rationale. A big answer needs a big question. And widespread technological unemployment might be just that.
Yet, if the past is a good guide to the future, such fears are overblown. Then again, given what’s happening in artificial intelligence and robotics, maybe the past isn’t such a good guide this time. Perhaps my AEI colleague Charles Murray is right when he argues, “We are approaching a labor market in which entire trades and professions will be mere shadows of what they once were.” I wouldn’t bet against it, at least not much.
To my eye, it’s hard to be optimistic about the future when you can’t see how it’s going to play out. The standard Libertarian (big L or little l) line concerning the advance of technology is that the more jobs are automated, the more it frees up humans to do something else that no one had time to do before. And, without a doubt, there are many jobs which are, or were, real soul-killers, from coal-mining to fast foods to, well, just think of which job you hated the most. Maybe being a shoe salesman.
QZ’s take on the purpose of the referendum matches mine:
As awareness of basic income grows, so does support. The main goal of the Swiss campaign has been to educate the public. The campaign has increased support for basic income in Switzerland and has sparked conversations around the world.
A recent poll done by DemoScope, in January 2016, showed 59% of people under 35 (link in German) believe basic income will become reality in Switzerland. Young people seem to overwhelmingly support a universal basic income–making it a political likelihood in the decades to come.
As income inequality becomes more and more extreme, fewer people have money to buy things. But we need a broad consumer base to ensure jobs and keep businesses afloat. Economists and business leaders who support basic income argue it combats poverty while also ensuring a strong middle class, because everyone gets an income boost.
So the failure is not a failure, just a strategic step. And the point about 59% of people under age 35 are in favor is very interesting. It appears that, at least in the West, the younger generations have a different view of how the world should be run vs most of us oldsters.
