A basic income guarantee would deal directly with poverty, says economics professor

Roderick Benns recently interviewed Dr. Wayne Simpson, a Professor in the Department of Economics at the University of Manitoba, about a basic income guarantee. Dr. Simpson is a graduate of the University of Saskatchewan and the London School of Economics. He is one of the guest speakers at the University of Manitoba’s February symposium, ‘A Basic Income for Canada and Manitoba: Why Not?’

Benns: Do you believe that a leaner bureaucracy is possible – including the eventual elimination of disability, welfare, and employment insurance with a basic income guarantee? 

Simpson: A leaner bureaucracy might occur because a basic income guarantee — I prefer guaranteed annual income — is delivered through the existing tax system along the lines of the Child Tax Benefit and other refundable tax credits. But the replacement of welfare, a provincial responsibility, with a guaranteed annual income is a provincial matter and replacement of Employment Insurance treats EI solely as an income maintenance program rather than a wage insurance program, which it is partly.  So it is hard to say how such programs would be impacted by a guaranteed annual income at the federal level.

Benns: From your perspective and background, what makes a basic income guarantee attractive as a policy option? 

Simpson: It deals directly with the problem of poverty and low incomes and effectively targets the low income population, which many current income support programs do not. Welfare does this, but is inadequate and delivered ineffectively outside the tax system.

Benns: How would you approach this debate with someone on the ‘right’ side of the political spectrum? What is the best approach in talking with conservative-minded people about this issue in terms of getting them to see the policy’s attractiveness? 

Simpson: The argument has always been that the problem of poverty should be attacked directly by a guaranteed annual income rather than indirectly and frequently by a series of programs that are poorly targeted to the poor.  In particular, we should not fool around with the market system – for example, minimum wage legislation – to reduce poverty.

Benns: Why are most politicians so reticent to touch this issue and how can we shift perspectives?  

Simpson: The GAI was seriously considered in the 1970s but other events (stagflation and budget deficits) drove it off the stage. It is a bold move that is not a particularly strong vote-getter, since the poor have a weak voting record. The focus on the middle class (however defined) reflects their influence as voters and I don’t see them citing poverty and a guaranteed annual income as important issues.

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