66. Free healthcare, but not free money? I don’t get it

I live in Denmark. Socialist paradise. Free healthcare and education. Welfare system from cradle to grave. Security and safety for the unemployed, the sick, the poor and the downtrodden.

That’s how a lot of the world thinks it is. Compared to many other places, it’s true, and while reality is of course more complicated, Denmark is a pretty good country to be out of luck in.

And yet when talking Basic Income, most Danes go bananas and call it crazy.

Basic Income?

Ok, let’s backtrack a little. Maybe you haven’t heard of the idea of Basic Income, or maybe you’re not sure how it relates to free healthcare and free education. Maybe you know what it is, but am curious about what I think it is. ;-)

The idea of Basic Income is simple. Pay each citizen a sum of money just for being alive. Preferably enough that they can get by on it. That means that if the US started paying everyone 20$/month it would be Basic Income, but it wouldn’t do much. Granted, for some it would make a difference, but for most it wouldn’t do much, and it wouldn’t be enough for anyone to live on without other sources of income.

Basic Income is the idea of paying everyone enough so that they can get by. Not a lot. But enough. In Denmark, you get around 800€ if you’re unemplyed and on the “lowest” form of welfare. It’s called “Kontanthjælp” (Cash Help), and there are people who live on no more than this.

Whether the kontanthjælp number should be lowered or raised is a matter of intense public debate, but it’s undeniable fact that there are people who manage on this income. So it’s possible, if not exactly fun. I’ll use that number in a moment.

For now, Basic Income has been introduced. And let’s use those 800€. In my new “Denmark with Basic Income” scenario, every adult Dane gets 800€ pr month. Every month. No matter if they’re working, unemployed, in school or in rehab. Those working will naturally get paid for that work as well, and there may be other benefits on top of that (a pension, for instance). But everyone gets at least 800€.

Some classic arguments

Quite a few Danes find this a reasonable suggestion. Sure, it would cost more than our current systems, but it would remove a ton of bureacracy (if everyone gets it, you need very little personnel to check up on who should get it!) and make a lot of people feel significantly more economically safe in their lives.

Taking a low paid job would also never be a matter of weighing it against loss of benefits. People who are willing to live cheaply could dedicate themselves to volunteer work, raising kids, or just relaxing a bit. There’s a huge debate out there with good arguments in favour of Basic Income, and if you’re interested, google will get you far.

But I’m not super interested in all the (obvious) benefits, as few people are arguing against them. I’m more interested in the arguments AGAINST, which is where people go into territory that doesn’t make sense to me.

One much-used argument is that if you could get money for free, the majority would stop working to earn money. I think that’s utter bullshit (800€ isn’t that princely a sum), but let’s look at it for a second. Let’s talk about whether people would work if we gave them money for free. After all, if you get stuff for free, why should you contribute to society?

And the cost! Think of the cost! It would triple our current welfare costs, and where would it end? Who would pay for it all? We can’t just give people free stuff. We can’t afford it! Right?

Here’s where I lose my comprehension

Because if there’s one thing we’re good at in Denmark, it’s giving each other free stuff via the state. We have free healthcare. We have free education. We don’t pay road taxes. We can go to the library and borrow books for free. We have public (free) museums. We have forests and beaches that are maintained by paid employees, but don’t earn money for the state.

All this costs money. A lot of money. When I went to the hospital with a ripped shoulder ligament (or whatever it’s called) because I’d crashed on my bike – it happened seven years ago because I was drunk and stupid – a doctor took care of me. An expensive machine was used to do an x-ray and see how bad it was. I got a special arm-sling to wear for a month. And somewhere, a secretary typed in my file, a cleaning person cleaned the floor that I had dirtied and someone paid rent for the space I had occupied.

I don’t know what that costs, but let’s assume (for the sake of the argument), that it costs 5000€. It’s probably completely wrong, but that’s ok. The number will do for now. It serves to illustrate a point, not to be correct. :-)

Now, that’s the state giving me 5000€ worth of service. That’s roughly 6.3 months of 800€ Basic Income right there. Or to put it bluntly – if I hadn’t been an idiot and crashed my bike on a drunken binge, some poor bastard could have gotten 5000€ over the course of 6.3 months to spend on rent and groceries. In theory. Reality is more complex, but it’s clear that if the state doesn’t have to use money on doctors and hospitals, it can use it on other stuff.

It isn’t free – yet we get it for free

Now, I don’t visit the hospital that often, because I’m privileged enough to have good health. I don’t make use of our free higher education (though I did 15 years ago) and I don’t get unemploymemt benefits. But I use roads, bike paths, parks, plazas and visit a musuem from time to time. I get free stuff from the state, even when I’m not crashing bikes.

What that “stuff” is worth, I have no idea. Probably quite a lot. But I’m lucky to live in a country where most of us will fight to the death for free healthcare and free education. We want our libraries to remain free, and if forests suddenly became pay-to-visit overnight, there’d be hell to pay in the court of public opinion.

Yet, when it comes to giving people actual money, perceptions shift. The same people who will passionately defend expensive (free) hospital visits for those who need them, will argue vehemently against paying out even a single Danish kroner in Basic Income.

We already give people Basic Income. We just don’t pay it out in cash. We give it out in services. We give people free education (and even pay them to study!), but what if they get sick and can’t get a job afterwards to “pay it back”? Then we still pay for them, and we do it with pride. Of course!

And when people get old? We pay them. Just to be alive. The idea is that they’ve already done their share, and now they should be allowed to rest. Except that our state pension (folkepension) isn’t paid out according to how many taxes you’ve paid in last 50 years. It’s just paid out to people who survive to reach age 67.

Sure, most of them have contributed and built society and paid taxes. But not all. And not evenly. Yet, the folkepension is for everyone. And if someone suggested that we only give folkepension to those who had paid a certain amount of taxes over the course of their working lives, there would be rage and fire and brimstone.

But extend the folkepension and make it lifelong?

It can’t be done! It’ll cost too much! It’s laughable!

You’ll defend free healthcare, free education and retirement pension, but the thought of giving people money is crazy to you?

And is now the time to mention that even students who get free money often work part-time to get more, turning 67 doesn’t necessarily mean that people choose to retire, and people on unemployment benefits take on jobs as well (though sometimes outside the system that penalises them for it)?

Is it time to point at all the cases of people who could just lean back and spend their time in front of the Playstation using their kontanthjælp, who instead work? Does this fear of people just quitting their jobs in droves because we give them free money really sound so realistic?

It does to many, who are afraid to give people free stuff.

But we’re already doing that on a massive scale. In fact, society’s redistribution of wealth seems to be a major in factor in why we’re constantly scoring high on things like “happy”, “democratic”, “equal”, “safe” and so on.

Maybe it’s time to realise that giving people free money isn’t fundamentally different from giving them free healthcare, free education, free museums, free roads and free parks. Maybe we should at least try it out and see how it works.

It might even turn out that it’s not as costly as feared, due to indirect benefits (as several studies have hinted).

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Director at The College of Extraordinary Experiences, Coach at McKinsey & Founding Partner at The Global Institute For Thought Leadership. Author of 31 books.

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