Previously we have mentioned that Universal Basic Income is truly asking for a guaranteed job and thus desires a Job Guarantee and can work in concert with Participation Income and that is absolutely fabulous.
In the Monetarist-Keynesian paraidgm of economics, it is accepted that there is a trade-off between unemployment and inflation (price stability). The Job Guarantee addresses this with a fixed price floating quantity mechanism to control for inflation. The fixed price however is set at a socially inclusive minimum wage plus benefits. This means of course that it is a rate above social security benefits like Jobseeker/Newstart and thus is not a form of Work for the Dole on steroids or otherwise.
To get to the crux of the matter as usually stated by enlightened Universal Basic Income advocates
Further, isn’t the insight of MMT that you might have to tax to reduce demand sometimes? In which case, a UBI can be easily designed to include taxes so that it redistributes in a way that doesn’t create demand-pull inflation.
Theoretically you could do that but what this fails to recognise is that the introduction of a Universal Basic Income is one policy, the adjustment of tax rates to counter the effects of a UBI is another policy. If one passes the legislature without the other it will be inherently inflationary unless we all decide to do socially useful productive jobs that need to be done .
Additionally the political economy of getting it passed looks like what happens with these two monkeys below. This is what happens when it is taxed away in its entirety from those that never required it.
Much better to target it and the best form of a Universal Basic Income is a Job Guarantee. It is universally accessible, provides a basic income and produces socially useful output and in the author’s opinion provides real freedom.