Case for basic income gaining traction
Alleviating poverty has always been a principal goal for China’s government, with efforts centered around improving access to education and revitalizing the rural economy in the country’s rural hinterland and far west while attempting to reverse economic decline in the former heavy industrial “rust belt” provinces of the northeast.
And to confront this, China’s antipoverty drive has taken on many forms: from reforming the healthcare and education systems, to targeting pollution, revitalizing rural economies, tackling migration and work residency issues as well as looking to redress the wealth imbalance between its affluent eastern provinces and the rest of the country.
In this respect, China’s efforts seem in tune with the international community’s desire to tackle widening wealth inequality. This is reflected in a growing global interest in the concept of a universal basic income, a form of social security where people receive regular, unconditional payments to create a de facto basic wage.
In fact, the concept is taking hold globally, as its social and economic benefits become more apparent.
To any nation considering universal basic income, one driving force is likely to be finding the means to reform an outdated, expensive or ineffective pension system — a universal concern and one that China has been keen to address.
The question of how to provide for an aging population and a workforce facing an increasingly automated future is a common one. Countries as diverse as Finland, India, Scotland and Kenya are considering a form of basic income to counter wealth inequality through an upgraded universal safety net.
Why is this? As people live longer, they are in greater need of lifelong education and training. Women are having children at different times in their lives, and as working patterns and requirements diverge, there seems to be a common consensus that outdated unemployment, disability benefits and pension systems need to be upgraded to a more flexible and sustainable economic model.
Trials into developing such a basic income model that began in Finland in 2017 have already made a positive impact, as the government there looks to find a way to counter the threat of increased automation — in the form of robotics and artificial intelligence — leading to fewer jobs and lower wages.
The Indian government believes the introduction of a universal income would reduce absolute poverty from 22 percent to less than 0.5 percent, while at the same time stimulating the country’s economy. And with a population roughly equivalent in size, the outcome of any trials in this regard would of undoubtedly be of interest to China.
So, could this form of centralized welfare system — one that streamlines pensions, unemployment payments and taxation — be something China could adopt or adapt?
Perhaps. In October, Beijing’s United Nations Development Programme hosted a summit with local professors to discuss the potential for launching a pilot program in China, according to the website of the Basic Income European Network.
And in February, the Macao Special Administrative Region government announced plans to spend over $1.5 billion this year on public subsidies, which includes their Wealth Partaking Scheme, a current low-level form of basic income, Xinhua reported.
Whatever happens, a global sea change in attitudes toward the concept seems to be underway, sparking genuine debate about how such a system could be put into practice.