1. The thin end of the wedge.
By agreeing to CBI, the Right has ceded the principle of universal redistribution - to an entitlement to a stake in GDP regardless of the fulfilment of prior obligations. Why will the Left want the size of this stake limited to subsistence only, as the Right might? Haven't we just created a ratchet for redistribution?...There will always be categories of people facing tough and specific problems - anybody think the Left is going to stand by and ignore them, in honour of a now-struck deal? So might we not just end up with the Welfare State as well as CBI?
The question of how far redistribution should go is, of course, a proper subject for political debate. For me, a subsidiary virtue of CBI is that it forces this issue out into the open, and requires us to justify redistribution in principle, rather than rely – as Gordon Brown does – upon slogans and stealth taxes.
In assuming that the “right” will lose this argument, Blimpish shows the defeatist mentality that’s gripped the Conservatives. If the Stupid Party were more confident it would welcome a CBI, as a means of settling the redistribution issue and allowing the state to shrink. This is how James Buchanan saw it in the 1970s. In The Limits of Liberty (p178) he wrote:
The rich man, who may sense the vulnerability of his nominal claims in the existing state of affairs and who may, at the same time, desire that the range of collective state action be restricted, can potentially agree on a once-and-for all or quasi-permanent transfer of wealth to the poor man, a transfer made in exchange for the latter’s agreement to a genuinely new constitution that will overtly limit governmentally directed fiscal transfers.
(A CBI can be seen as the annuity value of a transfer of wealth). Of course, the UK constitution at present doesn’t permit this. But should it?
2. Something for nothing?
I don't accept that people have a right to participate in the material benefits of their community simply by their existing. Citizenship starts with obligations; until we fulfil those obligations, we have a right to nothing - and certainly not to a share of our neighbours' earnings.
This misses the point that the case for a CBI is part of what Robert Nozick called a “rectification state.” We are born into a world in which the raw materials which we need to live on have already been appropriated. Past generations, in acquiring property, did not adhere to the Lockean proviso for legitimate acquisition; they did not leave “enough and as good” for others. Instead, acquisition – be it through enclosures, the slave trade, Highland clearances and the like – was mere theft. A CBI – accompanied by fierce inheritance taxes – is a rectification of this injustice. Even if you reject this, a CBI doesn’t fall. Indeed, you could regard CBI as a way of policing obligations; withdrawal of it could be one punishment for crime.
3. CBI would reduce labour supply.
Blimpish cites the SIME/DIME experiment as evidence for this. It will, he says, cause people to “watch Trisha in their pants rather than going to work.”
This is wrong: they’ll watch Jerry Springer instead.
Seriously, there are several possible replies here. First, a CBI would be accompanied by a reduction in some marginal tax rates. There are now some 1.7 million people facing an effective marginal tax rate of over 60 per cent. This will fall under a CBI, thus increasing incentives to work.
Secondly, almost all those who want to live on the CBI will be people who have low marginal productivity; Goldman Sachs won’t have a problem retaining staff. It’s no great loss if such low-quality workers leave the labour market.
Thirdly, a CBI would be accompanied by a deregulation of the labour market. That should increase demand for labour.
A final reply was provided by Philippe van Parijs here. Given that the labour market doesn’t (cannot) clear, jobs, he says, are scarce assets. Those who give up their claim to a scarce asset shouldn’t be punished for doing so.
4. CBI would increase marital break-ups.
The SIME/DIME, cited by Blimpish, seems to have done this.
And this is one of its many advantages. In giving women a guaranteed income, it increases their ability to leave abusive relationships.
This is, of course, only a sketch. As Blimpish says, an idea that hasn’t been tried will often look appealing against ones that have. But I think the CBI is sufficiently robust to his complaints to illustrate one thing at least – that it deserves a lot more attention than it’s getting from the political class.