
The Canadian Mincome Experiment of 1974-79 - tempestn
http://www.huffingtonpost.ca/2014/12/23/mincome-in-dauphin-manitoba_n_6335682.html?utm_hp_ref=canada-business
======
sologoub
This seems very different from basic income discussed today. What they
essentially describe is an expanded need-based assistance program. US provides
a tax credit for very low income that essentially results in negative tax.

The Swiss referendum called for unconditional payment. To me, the
unconditional nature is the preserving factor that incentivizes people to earn
more, while knowing they are protected. A needs based system results in fear
of losing what little you have. Low income housing in extremely desirable
areas works in similar manner and traps people, instead of incentivizing them
to seek higher paid employment because that higher pay will make them not
qualified for the subsidy, yet not able to afford the area.

~~~
rapind
The idea of unconditional payment is interesting, and I'm almost on board,
but...

1\. Is it tax free? If not then it's not equal right?

2\. How do you avoid it simply translating into inflation / lower dollar?

3\. Does it save money elsewhere to pay for itself, or are taxes increased?

~~~
justincormack
Most suggestions involve increased taxes.

~~~
tempestn
Yes, although generally up to at least mid middle class, the basic income
would offset the increased taxes, so you would end up with at least as much
take-home. High-income earners would most likely end up paying more though. (I
would argue that the societal benefits would be well worth it.)

------
wdewind
Not shocking because this is HuffPo, but this isn't a good article, and I
suspect it's because Mincome (minimum income) did not really provably work
(I'm not saying it didn't work, I'm saying there isn't data showing it did).

The article is filled with anecdotes of people who appreciated having extra
money given to them by the government (shocking). The only time it actually
get's close to examining the big picture is here:

 _In 2011, Forget released a paper distilling how Mincome affected people’s
health using census data. She found overall hospitalization rates (for
accidents, injuries, and mental health diagnoses) dropped in the group who
received basic income supplements._

AFAICT it did not examine whether or not this made the Mincome project "worth
it."

So there's nothing here really, or maybe there is, but not in this article.

~~~
WestCoastJustin
This seems to come up now and again, so there is actually many articles about
this topic floating around. Wikipedia has a pretty good overview [1, 2], for
something little more in-depth check out the University of Manitoba's TOWN
WITH NO POVERTY report [3], even Al Jazeera actually has a nice piece with
interview from several recipients [4]. If you search Google there is countless
good pieces about this experiment [5, 6, ..].

[1]
[http://en.wikipedia.org/wiki/Guaranteed_Annual_Income](http://en.wikipedia.org/wiki/Guaranteed_Annual_Income)

[2]
[http://en.wikipedia.org/wiki/Mincome](http://en.wikipedia.org/wiki/Mincome)

[3] [http://public.econ.duke.edu/~erw/197/forget-
cea%20%282%29.pd...](http://public.econ.duke.edu/~erw/197/forget-
cea%20%282%29.pdf)

[4] [http://america.aljazeera.com/articles/2014/8/26/dauphin-
cana...](http://america.aljazeera.com/articles/2014/8/26/dauphin-canada-
cash.html)

[5] [http://www.cbc.ca/news/canada/manitoba/1970s-manitoba-
povert...](http://www.cbc.ca/news/canada/manitoba/1970s-manitoba-poverty-
experiment-called-a-success-1.868562)

[6]
[http://www.winnipegfreepress.com/opinion/columnists/dauphins...](http://www.winnipegfreepress.com/opinion/columnists/dauphins-
great-experiment.html)

~~~
notahacker
That's kind of the OP's point though: these articles, including the academic
one, are all rich in anecdotes and poor in anything resembling hard analysis.
We learn that people are warmly nostalgic bout experiments which gave their
community more money from outside, that Dauphin residents saw improvements to
their general health relative to other areas, _which admittedly may have been
helped by a relatively new hospital_ , and that withdrawals from the labour
market were small, though people knew the programme was a temporary
experiment, the payments weren't that big and labour market conditions were
very different then. Major hypothesized downsides to universal BI such as
effects on local inflation (of housing costs in particular) _weren 't
recorded_ as part of the original study.

I've always found it strange that Hacker News, a site populated by
mathematically-inclined people responsible for all kinds of ingenious micro-
optimizations to maximise customer lifetime value by market segment or
optimise the ads displayed to demographic X, has so much love for the idea
that the optimal formula for distributing benefits intended to tackle poverty
is as simple as $WELFARE_BUDGET / $POPULATION_SIZE. Especially based on
evidence as thin as these articles

~~~
ufmace
Woah, wait a second - I hadn't thought of it until I read your "move money
from outside", but it sounds like a fundamental part of this scheme that it
was financed from outside the region it took place in. IMHO, that makes it
basically worthless for any kind of analysis on doing this on a national
scale.

Getting a ton of money from an outside source dumped into a region will pretty
much always improve things for people there. That hardly seems worth
analyzing. Exactly what you do with that money is a minor detail compared to
the fact that it's coming in from the outside. This allows them to completely
ignore the essential factor of how to go about taxing the population to get
the money to give to those deemed in need, and what the impacts of those taxes
and the mincome scheme as a whole will have on the mindset of people in the
region.

~~~
phaemon
> Getting a ton of money from an outside source dumped into a region will
> pretty much always improve things for people there. That hardly seems worth
> analyzing.

Does it not? Your statement is completely wrong so it may well be worth
analysing. Google "Dutch Disease" for an example. Check out the "McCrone
Report" for ways to avoid this happening.

------
noarchy
I've noticed the number of articles on "mincome" or "basic income" ramping up
quite a bit in places like reddit, and to a lesser extent on HN. I don't
necessarily have a problem with this, but are there groups actively trying to
get this idea out on social media, hence all of the articles that I'm seeing?
It may be that the idea is gaining organic momentum, on top of that, but I've
been wondering about this of late.

~~~
samspenc
I'm wondering who will be sponsoring / supporting this mincome? Won't it be
coming out of government taxes - and thus a higher tax rate?

~~~
jedmeyers
I also rarely even see back of a napkin calculations on how much money will be
given away, what will be the source of the money, etc.

~~~
bane
If you see one that doesn't account for labor dropout under a UBI scheme,
ignore it. It won't be a realistic model.

~~~
phaemon
So you keep claiming, but actual trials of mincome/BI/whatever haven't shown a
significant dropout of labour. Do you have any evidence for this other than
your gut feeling?

~~~
bane
_sigh_ this is absolutely exhausting

[https://news.ycombinator.com/item?id=8793466](https://news.ycombinator.com/item?id=8793466)

[https://news.ycombinator.com/item?id=8793453](https://news.ycombinator.com/item?id=8793453)

~~~
phaemon
I read those comments. They're exactly what I meant by "you keep claiming
this". Claiming it's so is not evidence. Perhaps you missed that in your
weariness.

My question stands: Do you have any evidence for this other than your gut
feeling?

~~~
bane
You can read the Mincome reports yourself. They aren't exactly glowing and
most of the reported effects are well within the margin for error in the
measurements.

BI and UBI has never been tried anywhere in a fully form because it requires
everybody on the planet to do it at the same time. The closest we have are
economic analogs. For example, resource rich locations that produce wealth at
multiples of the labor input. You can study the economics of these places
yourself and look at the outcomes. But they basically sum to: people stop
working, people collect their money, labor supply needs to be imported from
outside the local economy, the people who've stopped working don't exactly
spend this new free-time self-actualizing themselves into discovering cures
for cancer or unifying the fundamental forces of the universe.

If you want evidence, I suggest you open a high-school level history book and
start on page 1. If you aren't aware of these cases on your own, but willing
to promote nonsense like UBI, you're just being willfully ignorant of history
and basic economics.

No amount of handwaivery and ignoring poor outcomes based on this or that
technicality or goal post move will make cause and effect bend towards making
these schemes work.

So here's your test: find somebody who's working poor, offer to put them up in
your house and feed and clothe them no strings attached. How long before they
self-actualize into a high-paid white-collar degree? Repeat this experiment
10,000 times. How many people, given this options, would rather just sit at
home all day and surf the internet/watch TV/gossip vs. going out and
challenging themselves into a better life?

I don't have to answer this, BI advocates do. And they need to present the
outcome of this experiment as a real economic model that accurately predicts
labor participation and real-world situations. This has _never_ been done and
anything outside of this is hand waivy nonsense built on fairy dreams.

~~~
phaemon
> You can read the Mincome reports yourself.

I have. And the Namibian ones. And the Indian ones. None of them saw a
significant dropoff in labour.

> For example, resource rich locations that produce wealth at multiples of the
> labor input. You can study the economics of these places yourself and look
> at the outcomes. But they basically sum to: people stop working, people
> collect their money, labor supply needs to be imported from outside the
> local economy

Like Norway, you mean?

> If you want evidence, I suggest you open a high-school level history book
> and start on page 1.

How will a history book help me if "BI and UBI has never been tried anywhere
in a fully form"?

> And they need to present the outcome of this experiment as a real economic
> model that accurately predicts labor participation and real-world
> situations.

These were "real-world" situations. They actually occurred in the real world.
That's generally considered more "real-world" than economic models are.

I think I'll stop here. I'm starting to get too amused with this conversation.

Have a Merry Christmas and a Happy New Year!

~~~
dllthomas
When you say "Indian ones" do you mean the experiments with distributing
casino revenues unconditionally amongst a Native American tribe, or something
that happened in India that I missed.

Not trying to nitpick labels, just want to be clear as to the referents.

~~~
phaemon
I meant in the country India. I didn't even think about the Native American
situation, though now I consider it, it does seem to illustrate the dangers of
making payments that are socially exclusive (similar to the problems Australia
has faced with its aboriginal people).

I think the following links has more details on India, but I've not read
through it as it's late on Christmas Eve for me and I'm worried about
collapsing the Santa wave-function so I won't get any presents!

[http://isa-global-dialogue.net/indias-great-experiment-the-t...](http://isa-
global-dialogue.net/indias-great-experiment-the-transformative-potential-of-
basic-income-grants/)

~~~
dllthomas
The Native American case I was thinking of seems to be this one:

[http://www.demos.org/blog/1/19/14/cherokee-tribes-basic-
inco...](http://www.demos.org/blog/1/19/14/cherokee-tribes-basic-income-
success-story)

 _" Children who were moved out of poverty by the UBI saw their behavioral
problems decline by 40 percent. Minor crimes declined. On-time high school
graduation rates increased. Children who started receiving the UBI earlier in
life had better mental health in early adulthood than those who started
receiving it later in life. In particular, they were 33% less likely to
develop substance abuse or psychiatric problems."_

------
pervycreeper
There may be a good case to be made for a minimum basic income (
_portmanteaus_ notwithstanding), but one is not to be found in this article.

------
nwah1
A basic income without accounting for the Law of Rent cannot create any
sustainable solution. That is why a Citizen's Dividend, funded by a Land Value
Tax, is necessary.

~~~
16bytes
For those unversed in economic theory, care to explain why a basic income--
analogous to the one presented in the article or otherwise--is not a
sustainable solution?

~~~
ctdonath
The concern is, on the whole, those receiving & relying on a basic income find
a right to the fruits of the labors of others, without any incentive toward
their own productivity. Many people find that with a little care, they can
live nicely on little - and if that little is just given to them, then they
can occupy their time just fine with mundane leisure (eating, mating,
entertaining) and ongoing demand for more. Why contribute to national
productivity when idleness is encouraged & funded?

Many will contend that having the basics covered will encourage the poor to be
more productive by not limiting their efforts to mere existence (a la "might
one take time to learn programming if not obligated to a 16-hour-a-day job
just to pay rent & buy food?"). Many contend this is absurd, as those not
inclined toward productivity are not going to become inclined without any
reason to. Reality is a complex mix of these, the overall expectation being
grounded in one's faith (or lack thereof) in human productivity sans
motivation.

Basic income also risks devaluing money. The purpose of currency is
representation of value; if someone is not creating value, their money has no
value to represent. Money taken from someone and given to others (taxation for
BI distribution) gives workers nothing in exchange for their efforts; money
received for zero productivity may be squandered a la "easy come, easy go".
Concern is akin to minimum wage: a gallon of gas will always be worth about 20
minutes of clerking at a gas station, regardless of the number placed upon the
currency used to pay for the work and buy the gas. Basic income would skew
low-number pricing: higher prices may continue to represent greater value
accurately, but pricing of mundane goods/services would inflate as those
purchasing have done nothing to acquire the currency buying them.

Basic needs have a cost to fulfill. Making it easy to fulfill those needs
without social contribution reduces overall societal productivity, rewarding
idleness and punishing productivity, lowering national GDP. Requiring people
to work (true welfare cases aside) encourages productivity, including in work
people would rather not do but for need to provide for one's own basic needs.

Reverse question is worth asking: how can basic income possibly be
sustainable?

~~~
16bytes
> Many people find that with a little care, they can live nicely on little

I believe this is the crux of your argument, and I would say that it is a
postulate that cannot be assumed. If the "basic income" were $1k, few people
would find they could live on it and thus the motivation to work would remain.
On the other hand, who would work if they received $1 million per year? What
if it's somewhere in the middle? I would argue that the incentive for work
would remain if the benefit only brought people up to the poverty line.

Who wants to at live at the poverty line? $20k for a family of 4 affords very
little luxury.

> Basic income also risks devaluing money

Do foodstamps make food significantly more expensive for everybody? What is
the percentage of all food revenue bought with food stamps?

If 14% of US citizens live below the poverty line, the vast amount of GDP,
productivity, taxes and whatever else you want to measure are generated above
that line.

I've heard some arguments that a flat livable wage, without eligibility
requirements beyond income would obviate the need and overhead for a whole
slew of expensive social programs, including social security, welfare, food
stamps, and the minimum wage.

Then there are small scale experiments like the one in the original article,
though limited in actionable data did not produce behaviors like you
described.

So, to answer your question, it can be sustainable because it can replace some
expensive and hard-to-administer social programs with a relatively easier to
distribute system. There are tangible incentives to earn more than "basic"
income, and training to do so becomes easier. Lastly, the bulk of GDP and the
tax base are generated by those far above the poverty line.

~~~
dllthomas
As I mentioned elsewhere, it's worth noting that $20k/yr goes a lot further
when you're working 60hrs/wk at _stretching_ it than when you're working
60hrs/wk at _making_ it.

I don't mean this to play any particular role on either side of the debate -
I'm not sure of all the ramifications - I just think it's probably an
important point.

------
tokenadult
I posted an article about a guaranteed basic income a bit more than a year
ago,[1] and my posting of the article was prompted by noticing that other
Hacker News participants had commented about such policies before, followed by
my reading some articles that summarized Charles Murray's book about a
guaranteed basic income. Ideologically, Murray would probably be even more in
favor of no government welfare payments at all (but ask him directly for his
current view), but when he wrote his book _In Our Hands: A Plan to Replace the
Welfare State_ ,[2] Murray's basic argument was that governments are already
spending billions and billions of dollars derived from taxpayers for means-
tested welfare programs or other income transfer programs that are more
complicated administratively than a guaranteed basic income, and a nationwide
guaranteed basic income covers everyone at less administrative expense.

Murray's book goes into detail about how much a program of guaranteed income
for everyone would cost in the United States, and suggests some probable
effects that would have on everyone's everyday behavior. I read the book a
year or two after it was published.

Murray's own summary of his argument[3] and reviews of his book[4] may inform
the discussion here. Big public policy proposals are not easy to discuss, but
the big public policy proposal of a guaranteed basic income for all is a
response to existing policy of supposedly targeted social welfare programs
that are just about equally expensive in the benefits they provide, but much
more costly to administer.

As a matter of personal opinion, I am still thinking about whether or not a
basic income guarantee is a good idea, but I definitely want to figure out if
spending no more in total for social welfare by directly transferring cash to
all citizens would simplify administration of welfare programs and allow more
individual choice about how to use the money.

[1]
[https://news.ycombinator.com/item?id=6309882](https://news.ycombinator.com/item?id=6309882)

[2]
[http://www.amazon.com/books/dp/0844742236](http://www.amazon.com/books/dp/0844742236)

[3]
[http://www.irp.wisc.edu/publications/focus/pdfs/foc242a.pdf](http://www.irp.wisc.edu/publications/focus/pdfs/foc242a.pdf)

[4] [http://www.aei.org/article/society-and-culture/poverty/in-
ou...](http://www.aei.org/article/society-and-culture/poverty/in-our-hands-a-
plan-to-replace-the-welfare-state-article/)

[http://www.conallboyle.com/BasicIncomeNewEcon/MurrayReview.p...](http://www.conallboyle.com/BasicIncomeNewEcon/MurrayReview.pdf)

[http://www.richmondfed.org/publications/research/region_focu...](http://www.richmondfed.org/publications/research/region_focus/2006/fall/pdf/book_review.pdf)

[http://mises.org/misesreview_detail.aspx?control=296](http://mises.org/misesreview_detail.aspx?control=296)

------
blazespin
A basic income guaranteed as long as you stay on birth control makes sense to
me. Start paying a small amount at puberty. As soon as you have a child you
lose access to it until your children are adults. This will work for men once
we have reversible sterilization.

This would solve so many problems in this world.

~~~
benpbenp
Honest question, what problems do you think this would solve?

Is it that you don't want people to have children until they are financially
capable of supporting them?

It is indeed a grave responsibility to provide for one's offspring while they
are still in the brood. But the upside of the situation, even in the
unfortunate circumstance where one cannot make such financial provision, _is
no less than the creation of a brand new, fully conscious member of the human
species, capable of experiencing the full wonder and surprise of being, who
otherwise would have no chance of ever existing at all._

Furthermore, and here I risk delving into platitudes, children are quite
literally the future of society. The continued production of children at a
healthy clip is absolutely essential to the continuation of all the things we,
as humans, value highest.

Hence it seems deranged to me to be so afraid of any monetary hardship that
one should seek to positively disincentivize childbearing with such a broad
and punitive measure. You are tampering with processes of infinite value and
you do so at infinite risk.

As a smaller, more concrete objection, what about those who are initially of
sound bank account, but then fall into hardship sometime after they've
commenced in their procreative endeavours? Are they to be punished as well? In
light of this possibility, why not take the opposite tack, and instead reward
every new human life with a large gift to help pay for the cost of the
upbringing?

