Idea alert
By Aaron Wherry - Wednesday, January 5, 2011 - 61 Comments
Further to the guaranteed income discussion, there is what Brazil has done to great success.
The program, called Bolsa Familia (Family Grant) in Brazil, goes by different names in different places. In Mexico, where it first began on a national scale and has been equally successful at reducing poverty, it is Oportunidades. The generic term for the program is conditional cash transfers. The idea is to give regular payments to poor families, in the form of cash or electronic transfers into their bank accounts, if they meet certain requirements. The requirements vary, but many countries employ those used by Mexico: families must keep their children in school and go for regular medical checkups, and mom must attend workshops on subjects like nutrition or disease prevention. The payments almost always go to women, as they are the most likely to spend the money on their families. The elegant idea behind conditional cash transfers is to combat poverty today while breaking the cycle of poverty for tomorrow.
Though perhaps not comparable to Brazil, many have argued that Canada has its own inequality problem.
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How to help
By Aaron Wherry - Wednesday, November 24, 2010 at 11:12 AM - 21 Comments
Stephen Gordon considers the costs and benefits of guaranteed income.
There’s a proposal being floated around Quebec policy circles that would ensure that someone who works 16 hours per week at minimum wage would still have an income that would put her above Statistics Canada’s poverty threshold for Quebec (about $12,000). These amounts are far from lavish, but the costs are surprisingly high. In this report, some of my Laval colleagues estimate that the lower bound is on the order of $2.2b. To put this in perspective, one percentage point of the Quebec TVQ (the provincial GST) generates about $1.2b in revenues. Financing even this modest proposal would require the equivalent of at least two extra percentage points to the TVQ.
The RSS tag the Globe put on Kevin’s recent Economy Lab post says “If it’s not implemented properly, a guaranteed annual income could become a very costly program”. I think it’s better to say that if it’s not costly, then the BI isn’t being isn’t being implemented properly. There’s really not much point in arguing for a BI if you’re not prepared to argue for significantly higher taxes.
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Idea alert
By Aaron Wherry - Monday, November 22, 2010 at 9:01 AM - 77 Comments
Erin Anderssen considers the merits of guaranteed income.
Conservative Senator Hugh Segal, one of the more vocal proponents of no-strings-attached aid for the poor, points out that the guaranteed-income program for seniors has greatly reduced poverty, especially among women.
“There’s a bias that when given the chance people will be lazy,” he says. “That’s not my sense of reality.” Mr. Segal argues that giving money with no conditions removes the stigma and shame around poverty, allowing people to focus instead on how to improve their lot.
