The first time I heard of the idea that everyone should receive a monthly income for nothing, I thought "hell no." My gut said that this was unfair towards hard working people, that many would take advantage and not move a finger anymore and I wondered how such a model should be paid for anyways.
Over the course of time I realized that the only unfair part of it was my ignorance and that there was much more to the idea and concept of a universal basic income. In this article I would like to share why I have overcome my doubts.
First we should define the term Basic Income:
A Basic income is a monthly modest amount in cash paid to each individual (legal resident of a community/country), unconditional in behavioral terms, except for being a lawful citizen.
Then lets go through my main objections:
— It is unfair to just hand out money to someone who hasn’t „earned“ it. —
Consider this when talking about fairness:
The way we live today, our common wealth and income is the result of achievements of many generations before us and not of anything we did by ourselves. The land we occupy and the resources we use have been taken by our ancestors who have been landlords or miners etc. Some of them have been lucky or successful by chance, some have been gangsters or robbers.
Today it is not clear whose ancestors have contributed how to this collective wealth.
At the same time we allow for private inheritance and private returns to capital investments to shareholders so a huge minority already receives something (inherited wealth).
People’s access to the value of natural resources, inherited capital, and the economic returns to the social and technological infrastructure depend largely on which slot in the economy they happen to find themselves, largely due to circumstances beyond their control.
One might also argue that it could be a compensatory payment for the fact that we have unequal talents and therefor unequal opportunities of success.
If we acted fair, we should all have a collective share in the collective wealth of our societies.
A universal basic income could be the social dividend on that wealth.
— It induces laziness. —
One might assume that with an unconditional income there is no motivation or reason for “working”. However we all want to improve our lives and -relative to conditional forms of income support (welfare etc.) - a basic income has crucial advantages for supporting people’s opportunities to contribute productively and may well reduce exploitation overall:
If people know that whatever happens they will always have the basic income to rely on, people may generally act more confidently and productively as entrepreneurs and be more willing to try out new things, and accept (rather than resist) the necessary transitions of a dynamic economy.
In addition they do other forms of work, that are not labour (caring for relatives, community, ...) that are useful but not valued in the market
Recent Studies support this argument as the employment rates within groups that received a basic income stayed the same throughout the trial rather than declined.
Sure, some people might be freed from the need to do work they really hate, but that’s a good thing. Others might be freed to do work they really love, even if it doesn’t pay all that much. That’s a good thing, too.
— It is Unaffordable. —
It is indeed a tricky question on how to fund a UBI, which depends on many factors such as to which extent it replaces other welfare systems, if UBI were to reduce GDP (because there would be less traditional paid employment), from which age UBI would be paid out etc.
There have been different approaches and suggestions by economists and researchers which include
- charges for using key components of our legal and financial infrastructure for example modest transaction fees on trades of stocks, bonds and derivatives or fees on patent and royalty earnings.
- reduction or replacement of the current welfare system whose administrative costs are huge and which provides limited positive results
- income generated from universal assets, a.k.a. our common wealth. This may include charging polluters for using our scarce atmosphere, charging market prices for extracting minerals and timber from public lands that now leased cheaply to private firms
- taxes on unearned income such as rent, inheritance, … basically anything other than work for a wage.
Charles Murray published a think experiment in the Wall Street Journal where each US citizen above the age of 21 would receive an annual UBI of 13.000 USD, of which 3.000 USD must be used for health insurance. Murray argues that if the US would get rid of Social Security, Medicare, Medicaid, food stamps, Supplemental Security Income, housing subsidies, welfare for single women and every other kind of welfare and social-services program, as well as agricultural subsidies and corporate welfare, the annual cost of a UBI would be nearly a trillion dollars cheaper than the current system by 2020.
Guy Standing explains that the UK operates over 1000 forms of selective tax relieves (tax subsidies etc.) each year, of which mostly only wealthy and middle-income groups benefit from. These foregone revenues amount to 400 billion pounds a year. By shifting expenditure and instead of paying out subsidies paying individuals a basic income 400 billion pounds could easily finance an UBI model.
— Society is not getting anything in return. —
A basic income makes people more altruistic, more tolerant, more productive, more responsible. In addition trials in Kenya, Namibia and Canada have shown improvement in nutrition, education and basic health, such as improved childhood vaccination rates and school attendance, reduction in alcohol and tobacco consumptions, decrease in hospitalizations and drop in crime.
So what we do get in return are better healthier people.
The idea of basic income is a fascinating one and reveals more and more as one dives deeper into the topic.
Among many positive aspects there is one that I value a lot and that is:
Basic Income promotes freedom.
Most social policies apply behavioral conditions (we only give you a benefit if you perform this set or the other, which we think is good for you) thus limit personal freedom.
A modest guaranteed amount on the other hand strengthens the ability to say no. No to an employer, no to unfair or degrading working conditions, no to work we only accepted to pay for basic needs. It provides a basic security so that no one would be subject to the unaccountable will of someone else anymore.
There is a lot of emancipatory value in this concept, which could help empower women, encourage us to take more risk in the creative sense.
Resources and Inspiration:
- Guy Standing, author of "Basic Income, And How We Can Make It Happen"
- Carry Arnold, Nature International Journal for Science: "Money for nothing: the truth about universal basic income"; https://www.nature.com/articles/d41586-018-05259-x
- Simon Birnbaum, author of "Basic Income Reconsidered. Social Justice, Liberalism, and the Demands of Equality"
- The green institute: "Can less work be more fair? A discussion paper on Universal Basic Income and shorter working week"; https://www.greeninstitute.org.au/wp-content/uploads/2016/12/Less_Work_More_Fair_WEB_BM.pdf
- James K. Boyce and Peter Barnes: "How to Pay for Universal Basic Income"; http://evonomics.com/how-to-pay-for-universal-basic-income/
- Tim Forstall, Forbes: "Of course we can Afford a Universal Basic Income: Do We want one though?"; https://www.forbes.com/sites/timworstall/2016/06/04/of-course-we-can-afford-a-universal-basic-income-do-we-want-one-though/#1c25f5e0323c
- Charles Murray, The Wall Street Journal: "A Guaranteed Income for Every American"; https://www.wsj.com/articles/a-guaranteed-income-for-every-american-1464969586
- Scott Santens: "Why we should all have a basic income"; https://www.weforum.org/agenda/2017/01/why-we-should-all-have-a-basic-income/