Taiwan's Basic Income Movement Plans National Referendum

Taiwan's Basic Income Movement Plans National Referendum
Credit: Enno Schmidt
Why you need to know

Taiwan's plans to promote universal basic income must focus on a single idea.

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Taiwan’s unconditional basic income (UBI) movement is making progress, but still has a way to go if it is to realize its ambition of successfully promoting a national referendum.

Over the weekend, scholars, academics and advocates of UBI – the regular distribution of free money to all citizens as a form of social security – convened at National Chengchi University (NCCU) and National Taiwan University (NTU) in Taipei for the Basic Income Asia Pacific 2018 Conference (BIAP).

Speakers included Sarath Davala, the lead researcher of renowned UBI trials in India, Kuomintang politician Jason Hsu (許毓仁) and Enno Schmidt, the man behind Switzerland’s failed UBI referendum in 2016 (Schmidt prefers to focus on the 23 percent of people who voted in support of the idea.)

The event even received the blessing of Andrew Yang, the American entrepreneur and UBI proponent who is vying to become the Democratic Party's candidate for President of the United States. "UBI Taiwan is fighting the good fight,” Yang said by remote link. “I was honored to contribute to the BIAP conference because job automation has the potential to seriously hurt Taiwanese workers – and American workers – if UBI doesn't become a reality soon.”

But the truth is, as Taiwan’s Digital Minister, Audrey Tang, said in an introductory conference video, “UBI is not yet a popular public policy topic in Taiwan.”

Cover
Credit: Enno Schmidt
Members of UBI Taiwan, conference delegates and attendees in the grounds of National Taiwan University on day two of BIAP.
Evolving ideas

Last year, UBI Taiwan, the nonprofit undertaking to coordination support for basic income on the island, was looking into conducting small-scale trials in Hualien County or the Matsu Islands, similar to those successfully completed in India or that are ongoing in Kenya, as a means of proving the validity of the concept to a Taiwanese audience. India’s trials formed the basis of policy discussion last summer over launching UBI nationwide, and the plan was for Taiwan to follow a similar track.

But the December 2017 passage of new provisions to Taiwan’s Referendum Act (公民投票法) that lower the threshold for turnout required to enact a plebiscite has shifted the calculus.

“I don’t think a local trial is necessary anymore, the referendum laws have changed that,” conference organizer and UBI Taiwan co-founder Tyler Prochazka told The News Lens.

Under the amended law, the threshold to pass the first stage of the referendum process was lowered to 0.01 percent (from 0.1 percent) of the voters who participated in the most recent presidential election, which at the time of writing is 1,879, making getting the initiative off the ground a relatively simple task.

For the second stage, only 1.5 percent of those eligible to vote in the presidential election – some 280,000 people — are required, as opposed to 5 percent previously. The thinking is that if this hurdle is surmounted there will be enough buzz for mainstream politicians to engage.

“Gay marriage, minimum wage, and anti-nuclear initiatives for referendums have already started. UBI can be the next one,” Schmidt said in his opening remarks. “The idea in the first instance is not to immediately secure a majority but to spread the idea to the population and enable a discussion.”

Ping,_Enno,_Tyler
Credit: UBI Taiwan
UBI Taiwan co-founders Ping Xu (徐萍), Enno Schmidt and Tyler Prochazka debate UBI in Taiwan.
Picking a problem to solve

Over the course of the two-day symposium, UBI was mooted as a potential solution to Taiwan’s anemic birthrate, the threat to jobs from automation, rural poverty, widening inequality, youth unemployment, bureaucratic excess and environmental degradation.

And herein lies the problem for UBI Taiwan: How to cut through the noise and find a single issue around which supporters can coalesce.

Schmidt struck a chord in this respect by identifying a vacuum at the heart of Taiwanese identity. “Taiwan and the question of identity is massive and unresolved. What is the meaning of our economic success? What is our future?” he asked, picking up on discussions about the driving force of identity in Taiwan being one of differentiation, both internally and in respect to various historical antagonists, particularly our neighbors across the Strait.

Schmidt’s key message is that UBI is a matter of human dignity rather than an issue of national accounting. He advised that for the idea to catch hold in Taiwan it needs to be “sexy”; both impeccably presented -- and UBI Taiwan has work to do here -- but also propagated in a way that encompasses hot button issues like national identity and the social contract.

Various speakers at the conference echoed this sentiment, promoting the idea of “unlearning” our current concept of what “work” means in order to find a more meaningful work-life balance as technology displaces increasing numbers of workers. This might entail more accurately valuing the contribution of unpaid caregivers, or the role the young play in supporting the elderly.

But before these benefits can be contemplated, UBI Taiwan must pick an issue and run with it.

In Scotland, UBI is clearly framed as a solution to poverty as part of regional initiatives such as “Working Towards a Fairer Fife”. In South Korea’s Seongnam City, where a youth dividend is being trialed, it is a solution to youth unemployment. The widely vaunted partial UBI trial in Finland aims to tackle high unemployment and a cumbersome, expensive social security system.

Taiwan suffers from all these issues to some extent: By 2021, one study suggests Taiwan will have the worst brain drain in the world; its birthrate is the third-lowest in the world while the costs of education costs are among the highest; wages have been stagnant for two decades; the UN predicts Taiwan is on track to become a “super-aged society” by 2041; non-medical social welfare accounts for 5 percent of GDP versus an OECD average of 22 percent – just 1.5 percent of the population receives an average of NT$4,200 per month, and the list goes on.

Prochazka painted a bleak picture based on his experience conducting UBI questionnaires around the country. “The gist in rural Taiwan is a sense of helplessness,” he said. "People are leaving rural areas, leaving behind an elderly population with not many people to care for them. Living on NT$4,000 (US$144) a month when retired and 70 years old? We really need to discuss this.”

Prochazka and his colleague at NCCU, Elyse Mark, argued that UBI could give couples the confidence they need to start a family, the young the cushion they need not to emigrate, labor the confidence to bid up wages and society a much-needed ballast as the demographics turn ugly.

A national UBI proposal

That is not to say UBI Taiwan's plans are all pie in the sky. A draft is in circulation proposing a national UBI of NT$6,304 per month for citizens aged 18 and under and NT$12,608 per month for adults. The plan is costed at requiring NT$3.4 trillion, or about 19 percent of Taiwan’s GDP, equivalent to a notional flat tax rate of 31 percent levied on earnings of NT$840,000 per year or more. While that might seem untenable, the proposal points out that a proportion of that cost will be returned to taxpayers via the basic income payments.

The document also makes no bones about the redistributive effects of such a policy: 67 percent of the country stands to benefit while the remaining, richer third will be transferring about NT$710 billion to their poorer countrymen.

Prochazka advocates paying for all this with a pollution tax, perhaps funded through the phasing out of the multi-billion-dollar hidden subsidies provided to fossil fuel power generators to keep electricity costs depressed. UBI Taiwan research suggests there would be popular support for such a scheme. Occupants of the Presidential Office may be less enthused.

UBI Taiwan’s polling also posits that recipients of UBI would use the money for further education, skills training, volunteerism or entrepreneurial endeavor. “People don’t stop working, they change what they are doing,” Prochazka said.

Primary concerns mirrored those elsewhere, revolving around the idea that “free money” would promote laziness. Taiwan already has among the highest work hours in the world.

Forging a roadmap

Before bringing a strategy for a referendum together, UBI Taiwan plans to start a college lecture series and to investigate launching dedicated courses at National Taiwan University and NCCU.

“We want to start with the youth and trickle up – like the Sunflower Movement,” Prochazka said. “That’s how you get people talking. We have the research ready and we know the costs of not doing UBI are greater than doing it.”

Meanwhile, Legislator Hsu today (March 19) hosted Schmidt at the Legislative Yuan with an eye to introducing him and his ideas to a wider pool of politicians. Hsu also told The News Lens he is considering raising the idea of promoting basic income with leading Taiwanese companies like Hon Hai Precision Industry Co. (Foxconn) as part of a program to help workers displaced by technology to re-skill and re-enter the workforce.

Listen Next: PODCAST: Can the Universal Basic Income Save Asia from the Automation Cliff?

Editor: Morley J Weston

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