RE: Guaranteed income

From: Lee Corbin (
Date: Thu Jul 26 2001 - 00:07:16 MDT

I would appreciate it if someone who favors a guaranteed income would
respond to the following excerpt provided by Barbara Lamar from

>From Canada's National Post, December 16, 2000, By David Frum - an excerpt

Mr. Chrétien's guaranteed annual income isn't merely a bad idea. It's a bad
idea that has been put to the test -- and flunked. Proponents of the
guaranteed income take pleasure in pointing out that it was devised by
Milton Friedman. What they neglect to add is that it was actually tried by
the Nixon administration in 1969. A large sample of poor working families in
Portland, Ore., were divided into two. Half were provided a guaranteed
income; half were left to use the state's existing social-welfare programs
if they needed and qualified for them. The author of the experiment, Daniel
Patrick Moynihan, then Nixon's favourite domestic policy adviser, admitted
later that he was shocked and horrified by the extent to which the
guaranteed-income families quit working and -- soon after -- broke apart.

Nixon tried to solve the Portland problem by setting the guaranteed income
at a very low rate, so low that work would always be more attractive. But
this solution doomed the program politically: When it finally came to a vote
in Congress in 1971, conservatives voted "nay" because of the Portland
experience and liberals voted "nay" because the post-Portland Family
Assistance Plan (as this family-wrecking plan was euphemistically rebranded)
was too stingy.

What Mr. Chrétien needs to grapple with is that the poverty problem in
Canada is the product of too much government, not too little.

Brian Williams also writes

> I just wanted to mention an area the guaranteed income theorists
> seem to be missing.
> What happens to so-called minimum wage jobs? Don't get me wrong,
> the jobs will still be there but they will go vacant, why work for
> minimum wage when you can make the same doing nothing?

I don't recall that question being addressed either.


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