Based on what happens in remote communities here in Australia the result is not pretty. We basically have a basic income here in Australia via our welfare system. What we have found when everyone is jobless is there are huge levels of drug use, domestic violence, child abuse and general criminality. Other than this it works quite well.
negative income / social welfare are packaged in a way that telegraphs dependency and low self-worth.
[ I would also be really interested in seeing an economic analysis of how much money and time is spent on administering social welfare ]
Basic income needs to be marketed as a positive way : here's some money - it is your share of the basic wealth from the land/resources and the benefits of our technology to the country - do something useful with it.
[ I also wonder how many of those 'lazy-dole-bludgers' now on social welfare would have a better sense of self-worth, and actually get off their arse and do something useful if we didn't make it so clear to them they were total failures from school age ]
This is a huge problem with no simple solution. The problem in the Australian remote communities is there is an entrenched culture that is not conducive to any productive activity.
Changing this sort of culture once it has formed is really, really hard. People much more dedicated than me have poured in enormous resources without make a dent in the problem.
I think this is a really good point I haven't heard in the discussion before. I would imagine that simply changing the name from "welfare" to something that implies motivation would make a difference.
Imagine: You're 18 years old and your Dad gives you $500. He says, "You don't make any money and have to rely on me. Here is your spending money" or "You'll be making a lot of money (value) later on in life, this will help you kickstart it."
I can't say I know much about Australian welfare systems, but here in the US it can be a bit of a trap, since welfare benefits drop fast once your savings or income rises, resulting in a huge disincentive to get off welfare, and furthering the sense of hopelessness, and presumably, the drug and alcohol use.
To what extent does Australian welfare gradually taper off as a means to incentivize saving, instead of punishing it?
The Australian welfare system has lots of perverse incentives, but the tapper off is not too bad. The effective marginal tax rate is quite low and we have a very high minimum wage by OECD standards.
The real problems come when everyone in the community is unemployed. We really need to work on new societal structures to make sure that we don't follow the same path our remote communities have fallen into.
I'm not sure how well it would work, but one of my longest-standing justifications for basic income is capitalism itself. If you have enough to live on from what you get from the state, then you'll be content at best, or spin your wheels and with racks of VB at worst. But if your neighbor was in the same situation and works to increase their earnings, and you see them driving nicer cars and wearing nicer clothing, then you'll want to live at that level as well.
Then again, it might remind them of their own failures and they get double drunk that night. I'm not sure.
