
New dutch political party wants € 1,000 basic income for everyone - namenotrequired
http://translate.google.com/translate?sl=nl&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Fwww.hetkanwel.net%2F2013%2F10%2F22%2Fnieuwe-politieke-partij-wil-e1-000-basisinkomen-voor-iedereen%2F&act=url
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mbesto
I assume this is akin to Milton Friedman's negative tax:
[http://www.youtube.com/watch?v=xtpgkX588nM](http://www.youtube.com/watch?v=xtpgkX588nM)
I think it's brilliant. The major issue would be how to do a transition to it
and what the "magic number" is.

~~~
digitalengineer
I agree. However, this will never happen. Our Dutch society is entrenched with
'big governement' on a scale a US citizen could not grasp. Such a proposal
would delete most cival servants (and their contractors).

Wikipedia: "While the private sector is the cornerstone of the Dutch economy,
governments at different levels have a large part to play... In addition to
its own spending, the government plays a significant role through the permit
requirements and regulations pertaining to _almost every aspect_ of economic
activity. "

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AndrewDucker
I'd be very happy to replace unemployment benefit/welfare with this - and then
to remove the income tax allowance, so that people pay income tax on
everything they have over it.

This instantly removes the "benefit trap" whereby earning can make you worse
off.

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mberning
I agree with you and with the idea of unconditional basic income, but I would
only support it if means tested welfare were completely eliminated and the
basic income amount were inflation indexed to a broad spectrum of consumer
goods.

~~~
AndrewDucker
I'd settle for indexing it to median salary. Say at 24% or 33% of it.

~~~
tocomment
I'd say to index it to GDP.

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neals
Dutch guy here. Would totally spend all my time on OSS development, I can
already live of 1,000 a month. Let's make this happen :)

~~~
david927
I agree -- and I think the amount of innovation that would happen would be
unprecedented. I'm deeply disappointed in HN, that it killed this discussion.
This is one of the most important ideas around.

~~~
neals
Indeed, if I think of how much time I waste working on project that the world
doesn't need... so many people could spend so much more time on things (also
out side of software development) that matter more.

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ck2
We've discussed this here before.

I like to think I am progressive but I think this is the wrong approach.

Costs will rise to the minimum that everyone is known to afford (or higher to
deny the minimum income).

So rent will go up, food costs will go up, clothing etc.

You are just transfering wealth from the state to a few individuals who own
property and own chain stores.

Better to have rent control and other cost-of-living regulation.

~~~
chongli
_Costs will rise to the minimum that everyone is known to afford (or higher to
deny the minimum income)._

How do you support such a claim? If I was a business and all my competitors
did this, I would undercut them and make a killing!

Basic income (or something similar) is an inevitable outcome of our
development as a civilization. As technology continues to drive up
productivity, the demand for labour falls. As the demand for labour falls, so
does employment and consequently the demand for goods and services fall as
well.

It may be a very rough transition to get there but eventually we will have a
society where robots make everything we need and we are forced to devise a
system for allocating these products to the people.

~~~
ry0ohki
Because you are setting a floor. First, if you make a minimum income of 1,000,
anyone making less or around that will demand a raise, after all why would I
work if I could get the same amount loafing around the house. So the mid-lower
tiers get a raise, and now the tier above that doesn't want to make the same
as the lower tier and they get a raise, so there is inflation as everyone
suddenly as a lot more money to spend.

Which feels great for maybe a month or maybe a day, but with everyone making
more money, goods in that area will rise in price, as landlords find they can
make more money etc... and then we're back in the same situation. In theory
goods outside of this economy with a floor would remain the same, but since
the people that need to import it, store it, etc... would also be affected by
the inflation in the end it doesn't net anything.

TLDR; a basic income is an illusion, and inflation would quickly catch up.

~~~
batiste
Not sure it would happen as you describe it.

I don't understand why peoples with small income will suddenly feel entitled
for a raise. After all they just got a 1000 euros raise on top of their small
income?

For inflation I think the macro economic of Europe will not allow a drastic
increase in prices. At least not in the prices of goods. Shops will still have
to compete on prices and as there will probably be some people trying to live
on the 1000 euro alone you might see very cheap shops flourish.

If there is enough vacancy in real estate, people that have now more money
will be able to afford a nicer/bigger apartments and might just drive the
price of the least interesting ones down. Landlords will be forced to fix
their apartment or lower the price.

The situation at the end is that there a wealth redistribution that is
guarantied and equal for everybody.

~~~
VLM
"people that have now more money will be able to afford a nicer/bigger
apartments"

No not at all. The median dude will always live in the median house and
nothing about this will change it.

The primary real estate related effect is a dramatic change in macro societal
debt to income ratios which in the long term has some interesting effects on
bank assets and liabilities. Its very much like a stealth interest rate cut,
with pretty much identical effects. The price of real estate will of course
increase across the board, because the sellers know the buyers will have more
money to pay mortgages with. The median guy will still sit in the median home,
it'll just involve larger numbers in some bank account.

"equal for everybody."

LOL capgains are going to asset holders aka land and business owners and
banks, not the joe 6 pack. The primary effect on J6P is getting kicked into a
higher income tax bracket thus paying more taxes on a percentage basis. So
.gov wins. Pretty much everyone wins but J6P as usual, as designed.

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Daniel_Newby
> Its very much like a stealth interest rate cut, with pretty much identical
> effects.

No, it's even better. The basic income can create an effective negative
interest rate without giving the bankers an infinite Santa Claus, and most of
the money will turn the crank of the consumption machine instead of being
parked in safe havens.

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david927
This is huge: this definitely seems to be the seeds of a real movement and, if
so, it would be one of the most important movements of our lifetime.

~~~
mh_yam
Communist countries tried to do this in the 20th century and failed.

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nutate
I thought communism (theoretically) was more similar to a universal shared
maximum income.

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jerf
Very, _very_ theoretically. Communism definitely had many people much more
equal than others. It seems that if you hand over all the power to a glorious
central authority they will, you know, _use it_.

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rangibaby
I think that this is a great idea. I would rather people got their $1,000 and
stayed at home playing with their kids or studying on Udacity (or watching
movies and eating junk food) than flipping burgers for 12h a day.

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lprubin
Google translate gave me this gem: "Even the Republican Nixon was a form of
basic income."

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namenotrequired
Haha, yes it does funny things with some sentences. :) The original text uses
a relatively rare dutch way to phrase that the Republican Nixon was in favour
of a certain type of basic income.

Similarly, the dutch expression that's oddly translated here to "with straw
money" would perhaps be better translated as "throwing money around".

~~~
ck2
What is more funny (or less in that it is sad) is that by today's standards
for Republicans, Nixon was a liberal.

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padwan
Christian Engström Pirate MEP (Sweden) has been talking about this for a
couple of years already

[http://translate.google.se/translate?hl=sv&sl=sv&tl=en&u=htt...](http://translate.google.se/translate?hl=sv&sl=sv&tl=en&u=http%3A%2F%2Fchristianengstrom.wordpress.com%2F2011%2F11%2F20%2Fmedborgarlon-
ar-effektivt-for-samhallet-2%2F)

[http://translate.google.se/translate?hl=sv&sl=sv&tl=en&u=htt...](http://translate.google.se/translate?hl=sv&sl=sv&tl=en&u=http%3A%2F%2Fchristianengstrom.wordpress.com%2Fcategory%2Fmedborgarlon%2F)

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Bojangly2000
Listen to this:
[http://podcasts.tvo.org//bi/audio/2076107_48k.mp3](http://podcasts.tvo.org//bi/audio/2076107_48k.mp3)

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Symmetry
I would be totally in favor of a basic income as long as it was a replacement
for (some of) unemployment insurance and the minimum wage. We as a society
really want people to have an incentive to work and don't want to price out
people who are only marginally employable, but we also want to help poor
people. There is some disincentive effect to a basic income since working for
$6/hour when the alternative is nothing is more alluring than when the
alternative is just getting by on the basic income.

But on the gripping hand, it's ridiculously simple to administer and doesn't
have breaking points like other policies. I think that people consistancy
underrate the importance of simplicity in government programs, especially in
democracies where voter attention is often the binding constraint on good
policy.

And if robots do eventually replace human labor - something I'd say is
unlikely but possible, then we'll be needing something like this.

~~~
guerrilla
Robots may not replace human labor, but a combination of automation and
outsourcing to another nation could significantly reduce the required labor
for the original nation.

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kingmanaz
The Netherlands may wish to reevaluate its immigration policies before
subsidizing citizenship. There are many billions of people in the world who
are not being paid to reside in their respective nations. A basic income
coupled with open borders would likely act as a draw for further economic
migration.

~~~
ramblerman
I have always found this to be the deep irony embedded in socialism. Let's
make things really nice and humane. But only for the people born between these
lines.

You could argue that globalization and a true free market don't make this
nationalistic distinction, and are in essence fairer to the human population
on a whole.

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namenotrequired
Clickable link to original (Dutch):
[http://www.hetkanwel.net/2013/10/22/nieuwe-politieke-
partij-...](http://www.hetkanwel.net/2013/10/22/nieuwe-politieke-partij-
wil-e1-000-basisinkomen-voor-iedereen/)

~~~
LaurensBER
For comparison, Dutch students receive between 200-400 euro monthly (and do
pay a heavily discounted 1800 euro college tuition), "bijstand" (which is sort
of a last resort income) is 600-700 euro, unemployment compensation is 70% of
the last earned wage for a limited amount of months.

People above the 65 receive a "basic income" called "AOW" (algemene ouderdoms
wet) which is between 750 and 1400 euros (in addition to a pension).

Minimum wage for a fulltime job is around 1400 euro (1200-1300 after taxes). A
starts position for someone without college pays around 10-13 euro per hour
before taxes.

With the current high un-employment numbers a lot of students and young people
have to life on a income of 400-800 euro per month which is incredible tight.

1000 euro is a lot of money, I guess I could support something like a 400-600
"basic income" with strong incentive for people to work.

Then again the AOW is incredible high and although I do support the idea
behind it I do wonder how we're going to support AOW payments with the coming
demographic shift.

~~~
guerrilla
The situation is somewhat similar in Sweden, especially regarding the
'bijstand.' In our case, you'd have to re-apply each month and they would
audit your spending for the previous 3 months (so that, for example, you
didn't spend it all on alcohol or an Xbox.) It's also not a fixed sum but
based on what they consider necessary, but beyond what I know about U.S.
(specifically, California) welfare.

This is not the same as unemployment benefits, but, as you say is a last
resort. Unemployment benefits here are given on the condition that you show
that you are currently applying to jobs. We used to get a few of these
applications at our old office. People would come who weren't remotely
relevant to the job, but did it just to keep getting the payments, so that's
something to think consider when you mention "with strong incentive for people
to work."

Thanks for explaining the overall situation. I wish I knew more about Sweden's
but maybe someone else can post Sweden's corresponding information with
details.

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tekalon
I think if this was implemented in the US, the best way to do it would be to
include a mandatory financial education class every x time (one a year, every
quarter, etc). Have it online or at local community (YMCA, library, etc). If I
had an extra 1k coming in every month, I would totally put all of it back into
blasted student loans. How many would love to be able to have it go directly
to student loans, mortgage/rent payments, car/credit/other loans? Get rid of a
majority of the personal debt in the country, see a boom in the economy. Teach
everyone (children and adults) how to save for education, emergency, health,
retirement, large purchases- healthy economy.

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GotAnyMegadeth
I think this is a good idea. However, this does seem dangerous for drug
addicts.

~~~
efdee
The Netherlands has a rather liberal drug policy, and because of that,
considerably less drug addicts than other European countries.

Also, addicts will be addicts. I'd rather they get the money than steal it or
kill for it.

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kfk
Economic growth has historically brought much more wellness and brought up
more people from poorness than any kind of State initiative. Let's keep this
in mind when reading these news. What we are doing here is saying that taxing
more the "rich" and giving to the "poor" brings more wealth than leaving these
money to who earned it for investing.

Edit. Please, do remember that disagreeing!=down voting

~~~
quinnchr
No sorry. The labor movement and state initiatives have brought much more
wellness and brought up much more people from poorness than any kind of
investor.

Also, historically speaking, state initiatives have created the most economic
growth.

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kfk
Please, go look at the charts of GDP and GDP per capita growth and see it
yourself.

What we need is growth. Look at our public loans. We have been betting for
_decades_ that we would grow more than we are. What do you think will happen
if we miss the growth bet with an aging population in need of expensive health
care?

~~~
quinnchr
Looking at GDP per capita over the past century it looks like it rises sharply
around WWII and there is a slight rise in the 80s, but for the most part it
has steady growth.

Considering WWII and the 80s saw the highest increases in deficit spending, I
think that just proves my point?

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bsbechtel
This won't work. Prices will rise because ultimately there won't be enough
supply to satisfy the increased demand of goods required at the most basic
level of living. The only way to help the poor and unemployed is to find
innovative ways to increase supply, which will lower the cost of producing
said goods. This is why, in the United States, even the poorest citizens have
access to food and housing - our government subsidizes the production of these
products, which spurs an increase in supply and lowers the price.

~~~
lumberjack
Why would the demand for basic goods change? The poor are are already getting
fed and clothed in much the same way as they would on basic income.

~~~
bsbechtel
Because it puts an extra $1,000 in everyone's pocket, not just the poor, so
everyone will have additional money to spend on higher quality goods, driving
up demand along the entire spectrum of price/quality for a given item.

I'm not a huge fan of subsidies because it distorts international markets and
hurts other countries (mainly poor ones), but a better alternative might be to
give large corporations a tax incentive to pay their minimum wage workers
more, or provide them with additional benefits. Redistribution of wealth
through the government is a great idea in theory, but it eventually breaks
because you get a crooked politician in office or someone who can't manage the
redistribution program effectively, as we're seeing in the US (look at our
current debt problem). Plus, redistribution programs involve the government,
which is an unnecessary step and complicates the process. If you encourage
corporations to just pay their employees more, governments don't need to 'tax
the rich' to 'feed the poor'.

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michalu
Here we go, already declining Europe turning even more socialist. The problem
is that most countries in Europe are not like Switzerland where the common
culture is economically educated and work oriented. If this passes in
Switzerland or Netherlands it may actually work, but if it spreads to and
passes in e.g France, Spain or some post communist countries in EU it may lead
to completely different outcome and EU economies are increasingly co-
dependent.

Even worse thing is that there is a lot of populism in Europe spreading
lately, I fear this will be quickly adopted as a tool to get more voters in
countries that respond to populism well, eventually gaining support for
economically illiterate parties.

~~~
InclinedPlane
Turning socialist...

Have you any concept of the percentage of GDP that most European governments
take in through taxation or on what sort of programs that money tends to be
spent? Europe has already been socialist for a long time, some places much
more so than others.

