First, what is universal basic income (UBI)? UBI is an unconditionally given amount of money to all citizens. In the US, the figure most commonly discussed is $1,000/month to everyone who is 18 years or age or older. Sounds crazy, right?
It wasn’t crazy to Dr. King, Jr:
Here’s more:
Check out these videos for an introduction to UBI:
How #UBI Will Make America Even Better
Boost the economy
– much of this money will be spent right away in the US economy. 61% of Americans can’t afford a $1,000 emergency expense.* Many Americans live pay check to pay check. For these people, this $1000 would serve as emergency funds and would likely be spent largely on everyday expenses and consumer goods. The majority of UBI funds will go right back into the American economy in the form of groceries, utilities, dining, Amazon orders, and Netflix subscriptions.
Prisons/reducing crime
– a person would lose UBI if they go to prison, so it’s a $1,000/month incentive to not commit crime. Though it won’t eliminate crime, for many people loosing their $1,000/month check could be a reason to not commit crime.
Once sentenced and in prison, people will want to be on good behavior to get out sooner – the longer the prison sentence the more UBI payments will be missed.
UBI should reduce recidivism. Many people get out of prison with very few resources to get started again. It can be hard to find a job when a person has a record. By giving people fresh out of prison the money to get started again, UBI should help make people less likely to return to crime.
Leaving Domestic Violence and Abusive Situations
– with $1,000 coming a month, people in abusive situations will have money to leave. Especially in circumstances where only one partner is the wage earner.
Promotes Legal Immigration
– it’s likely only legal participants in a society will receive UBI. This is a massive incentive for people to immigrate legally and for those in a country illegally to legitimize themselves by paying taxes and taking formal steps towards residency and citizenship.
Retail, driving, and manufacturing jobs are going away.**
These are big employers representing billions in annual wages. UBI will not replace these wages, but it will ease transitions. The extra money will help people pay for bills and necessities if they are laid off. It could also help finance a move to another area with more jobs.
Health and Wellness is likely to improve.
When Finland tested UBI on those who were unemployed it sadly didn’t increase employment. It did however increase health and wellness.
A major downside of UBI is payday loans and predatory lending, if UBI isn’t done right.
Having more cash on hand — cash that’s ongoing could be used as collateral to take out loans for frivolous things or necessary things. Though famous UBI proponent Scott Santens and candidate for US President, Andrew Yang have the opposite take.
It would be a shame if people use UBI to fund rampant consumerism. Vices like drug use and gambling could also increase.
The beauty of UBI though is choice. People will get to do with the money what they want which could mean taking out bad loans, or spend the money on gambling, however, adding conditions to the money increases regulation, in turn increasing the costs of administering the program which could make it untenable. The unconditional nature of the money is why many of the above benefits are anticipated to be realized.
More reading on universal basic income
Want to learn more about basic income? Check out these info and resources:
Scott Santens
– is one of the most prolific writers about UBI right now. He primarily publishes articles and analysis on Medium.
He sent me this follow up to this article shortly after I wrote it. Thank you, Scott.
Andrew Yang
– is a democratic presidential candidate who is running with UBI as his core platform. He was on episode 1245 of the Joe Rogan podcast in a two hour long discussion on the topic. Andrew Yang calls UBI the “Freedom Dividend,” and asks why can’t all American’s get a reward for participating in one of the most successful countries in the world.
Women for UBI on why a basic income should be done prior to a job guarantee program.
Rutger Bregmen, “Poverty isn’t a lack of character…”
Also speaks extensively about UBI. Here’s his TED talk on the topic:
Additional reading from qz.com: We talked to five experts about what it would take to actually institute Universal Basic Income
Citations
*Martin, E. (2018, January 18). Only 39% of Americans have enough savings to cover a $1,000 emergency. Retrieved February 15, 2019, from https://www.cnbc.com/2018/01/18/few-americans-have-enough-savings-to-cover-a-1000-emergency.html
**Winick, E. (2018, January 25). Every study we could find on what automation will do to jobs, in one chart. Retrieved February 15, 2019, from https://www.technologyreview.com/s/610005/every-study-we-could-find-on-what-automation-will-do-to-jobs-in-one-chart/
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