Universal Basic Income (UBI) is the idea that all citizens of a country should regularly receive an unconditional sum of money in order to pay for basic living necessities. In practice, UBI would replace the current welfare system and it’s numerous existing programs as a more transparent, efficient, and affordable alternative. UBI would ultimately eradicate poverty and prepare us for the future economy that is rapidly changing due to technological process and automation. Let’s take a closer look on how UBI could work in the American economy.
In America, the poverty line for a single individual is $11,880. Thus if UBI were to provide every citizen between the age of (18-64) with $12,000 a year, it would instantly bring every citizen above the poverty line. This will allow a couple things to happen. First the need for a minimum wage law would become unnecessary because it would no longer have to provide a basic living, and therefore involuntary unemployment would no longer exist. Competition would thrive and people would be more willing to take risks knowing they’ll always have $1000 in the bank every month.
Secondly, women would be reinvigorated into the economy. Women disproportionately provide the majority of care taking roles in families for children and elderly which is work that is monetarily uncompensated for. UBI would thus be a transfer of wealth to care takers (and therefore mostly women) and provide them with compensation for work that they already do for free. Indeed, UBI would be the biggest feminist revolutionary act of our time.
While the economic boom that UBI is capable of providing looks promising, some skeptics have challenged it on several fronts. One criticism of UBI is that by providing people with free money is that people will have much less incentive to work. This is a fair criticism, but it is one that can be addressed by changing the tax system to a more progressive one.
In the current welfare system, benefits are phased out as workers earnings increase. This creates poor incentive to work, and in some cases like those with disability insurance, the choice is binary: work or receive benefits. With UBI, workers will only stand to gain from working and educating themselves to fit the needs of future markets.
Another strong criticism of UBI is it’s relationship with families that have a lot of children. Should UBI provide more for these families? Is this fair? And perhaps more importantly: Is this economically sustainable? This is a problem directly related to overpopulation. You can read more about this in my blog post Overpopulation: A Road to Dystopia. As far as I can tell, UBI advocates haven’t been entirely convincing on this front. However, some argue that this will be a non-issue.
UBI will require a change of mindset in the way we view work in our everyday lives. It will require us to accept the uncharted territories of a new world that has an abundance of resources, massive automation, and a diminishing need for traditional work. Despite the challenge this presents, I’m incredibly optimistic to the implementation of UBI in the near future (25-40 years) here in America. I expect this conversation to elevate onto the national level in the coming years.
For further reading on arguments for and against UBI, some recommended articles: