By the end of yesterday’s Social Liberal Forum conference, my mind was buzzing after a day of fascinating and thought-provoking sessions. I jotted down some takeaways on the way home. I have more to follow on party strategy, but here are my thoughts from two sessions that focused on policy.
Globalisation vs democracy – can we choose both?
The event kicked off with the delivery of the William Beveridge Memorial Lecture by the esteemed William Wallace. In a wide-ranging talk, Lord Wallace spoke about the ways in which globalisation sharpens inequality in domestic economies (the global rich get wealthier while the left-behind get squeezed) at the same time as other factors have weakened social cohesion.
In particular, he noted the weakening of local democracy in the UK and a fading of social solidarity — this, he added, had been at its strongest during the two world wars, because people from all echelons of society were brought into close proximity in a common cause. Nowadays people don’t know the reality of how other people live. I thought immediately of the newly appointed Westminster Council leader who has never been inside a council tower block, not even during election campaign.
Lord Wallace’s perspective gives some insight into the as-yet–unpublished findings of the working group of LibDem peers looking into what the party should be saying to the ‘left-behind’ who voted ‘leave’. On that score, I’m sorry to say I didn’t hear much that impressed me. I felt there was a bit too much of a drawbridge-up tinge to several of his suggestions. I won’t go into that here as I’m sure the full text of the lecture will be published in due course [updated 23/07 to add link] and people can read it for themselves.
Personally, I can never think about this topic without recalling the apocryphal banner seen at an Occupy Wall Street protest, “Join the world-wide movement against globalisation.” Instead of fencing communities off from the effects of globalisation, can’t we find ways to provide more support in helping them come to terms with it and harness its potential benefits? Which neatly brings me on to the second policy topic …
Universal Basic Income (UBI) – an enabler not a handout
The room was packed for this fringe session led by SLF chair Helen Flynn, who is a strong proponent of UBI. My biggest takeaway was the need to get our messaging right to win acceptance for this big idea.
Personally, I believe the party should commit to Universal Basic Income as a long-term policy objective. But it has to be sold carefully if it’s going to win widespread support. And with Vince Cable as leader still apparently happy to use the language of ‘magic money trees’, we not only have to commit to it, but also show that we are competent to deliver it, with a properly thought-out funding plan.
The first step is to win support for the idea in principle. One of the huge dangers is that those who pay tax will view it as an unnecessary cost, for which they are carrying an unfair burden. I think this can be defused with a two-pronged approach.
First, emphasise the value it delivers to society at large by giving people the freedom to realize their potential. As one contributor put it at the meeting, it’s not a safety net, it’s an enabler. Its purpose is to give people more choice in life — to pursue training courses, try out new business ideas, perform voluntary work, take time off to be a full-time parent, and so on. Rather than imposing additional cost on society, it unleashes new value.
Secondly there is the question of how to fund it. As I’ve argued elsewhere, there is a strong case for increasing taxes on company profits because of the greater return on capital that businesses can achieve today, thanks to current advances in automation and technology. In popular terms, call it a robot tax or, more positively, an AI dividend. If we can position it as something that job-destroying robots are paying for, then that puts it in a different light than some huge new burden that has to come out of individual taxpayers’ pockets.
A first step to winning acceptance of UBI?
I think the final element is finding an incremental approach that allows us to win acceptance of UBI in small steps rather than in one big bang. What I’m calling the AI dividend will grow substantially over time, but currently it’s probably only a few percent, realistically, of most companies’ profits (and many that are still in desperate need of modernisation will rightly want to claim relief so they can invest in new technology). Meanwhile, the principle of just giving money to people as a right needs to be proven. The case for child benefit is generally accepted but UBI is at a much larger scale.
My final thought therefore is that the suggestion of government-funded ‘learning accounts’ for every school-leaver, which Vince Cable is currently promoting, is a useful precursor to implementation of UBI. Particularly if, as I have suggested, this is funded by a robot tax (or let’s call it AI dividend). For that establishes both of the key principles in one go — a universal provision that people spend according to their own choices, funded by the proceeds of rising automation. And the learning account is something that would be affordable if we were in government tomorrow, as our first step on the path to the even bigger idea of UBI.