Today we face widespread labor displacement caused by automation, a dangerous level of wealth inequality, climate change threatening to cause massive loss of stability, political polarization, and more. Though we face numerous problems, there is a policy solution which would help to alleviate many of these issues.
Universal basic income: a periodic cash payment to individuals which is paid out to every citizen of a country with no means test.
A livable universal basic income would, alongside programs for other essentials such as healthcare and education, solve many of the largest problems facing our society today. Here are the major benefits of this kind of universal basic income.
Solving the Labor Automation Crisis
The United States will soon be hit with a massive wave of labor displacement due to automation which we are utterly unprepared for. Studies have shown that this wave of automation will not create more jobs than it will destroy, and that labor disruption will continue to accelerate over time. Improving education will help, but this alone will not be enough to mitigate the widespread unemployment we will see in the years ahead. A jobs guarantee program would only waste human potential by forcing people to do work machines could do better. The only good solution to this problem is a universal basic income.
As Martin Luther King Jr. said: “… the simplest approach will prove to be the most effective — the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.” Studies from around the world where people were given money directly have returned very positive results. Poverty is a lack of capital and opportunity which spans generations. We often think of poverty as a mysterious problem which is very difficult to solve, but as it turns out, it isn’t. The best solution to people having a lack of capital is to simply give it to them directly. Of course, other programs are still needed to address core needs, such as universal healthcare.
Reducing Wealth Inequality
The extreme inequality which exists in America today, and will continue to get worse with time, is one of the defining challenges of our time. It is extremely dangerous and is already eroding our democracy and putting our society at risk. Universal basic income reduces inequality by directly redistributing economic gains which have been hoarded by the wealthy for decades.
Increasing Social Cohesion
One of the core reasons we are seeing Neo-Nazis march in the streets of America and gather on social media platforms is widespread economic disenfranchisement. History has shown that when people are financially disenfranchised, they may gain the belief that there are a very limited number of resources and that there must be a strict hierarchy of who is most worthy to receive them. The main objection to immigration in the United States is the fear that they will “steal our jobs”, an unfounded but still widespread idea. A universal basic income would eliminate this life and death game of musical chairs, in which machines, not immigrants, are removing the chairs.
Improving Physical and Mental Health
Poverty is a major health risk. Large scale health reform is essential in the US if we want to be able to provide our poorest citizens the same level of care as other developed countries. Healthcare should not be something people need to spend their basic income on. Instead, the impact on health should be indirect. People will have more time to focus on personal and mental health when they are not constantly worrying about how to make ends meet. The link between poverty is well documented: those living in poverty live shorter, less healthy lives. Poverty actually puts enough stress on the brain to reduce scores on IQ tests by 13 points. This gap is the same as that which exists between a chronic alcoholic and a healthy adult. In the Dauphin, Manitoba basic income experiment in Canada, an 8.5% reduction in hospitalization was observed. It is hypothesized that reductions in family violence and workplace injury were what created in this change.
Improving Access to Education
Although programs to make higher education more accessible should exist alongside UBI, a universal basic income would improve educational outcomes by allowing people to focus on learning. In studies on basic income, people often invested their newfound free time in education. Having an educated population is vital to the future of any country, especially now, as automation is about to make many lower-education jobs obsolete.
Compensating People for Undervalued Labor
In today’s world, we do not properly compensate people for the many kinds of work they do to benefit our society. Cleaning the home of a rich man is a considered a job, building one for a homeless man is not. Many people, including artists, care providers, cleaners, parents, and educators – are not compensated adequately for their time. Many of these jobs are essential to our society. If given a universal basic income, the people doing these jobs can focus their time and energy on them, without having to worry about their basic needs being met. In our world there is not a shortage of important work to be done, there is a shortage of people who have the time and energy left to do it after they work to meet their own basic needs.
It is nearly impossible to start a business in today’s world without a certain amount of initial capital and a solid safety net to fall back on. Universal basic income would provide that capital and safety net. This is one of the main reasons entrepreneurs such as Elon Musk and Mark Zuckerberg support universal basic income. We like to think of America as a land of opportunity, but when you look at the data, that just isn’t the case today. Upward mobility is higher in Canada than it is in the United States. A universal basic income would dramatically increase entrepreneurship by giving people the time and safety net they need to take risks and innovate. In studies on universal basic income, participants have reported having more time and financial freedom to pursue business.
Helping the Economy
A recent study found that a universal basic income would grow the economy by $2.5 trillion. Currently, economic growth is constrained due to the number of lower income households. In recent decades wealth has been shifting rapidly away from the poor and middle class. As a result, those markets become less practical for businesses to target, resulting in lost economic potential. The economy is a lot better off when wealth is more evenly distributed.
Reducing Crime and Incarceration
In the US we incarcerate 716 people for every 100,000 residents. That’s more than five times that of any other country. This costs the US over $1 trillion each year, and that isn’t even including what the incarcerated could be contributing to the economy. Economic desperation is often what leads people to commit the kinds of property crimes which lead to incarceration. By giving everyone enough to meet their basic needs, you would reduce crime dramatically by eliminating the core incentive for most crimes.
A livable universal basic income empowers workers by giving them the ability to quit their jobs without having to worry about how they will survive. This removes desperation from the labor market, making workers far more capable of standing up to abuse and unfair wages. What universal basic income represents is a permanent union strike fund: true freedom for workers to make choices and demands for themselves. This will be especially important as more and more workers are shifted over into the gig economy and are put out of work by automation.
Giving Political Power to the People
For better or worse, money is a very big part of our political process today. The more money a demographic has, the easier it is for them to influence politics by donating to candidates they like. With a universal basic income, we would see more political movements funded largely by small donations which better embody the will of the people. Additionally, a universal basic income gives people the freedom to participate much more actively in politics because they wouldn’t need to spend all of their time and energy working a job they need just to survive.
The Time for a Universal Basic Income Is Now
Universal basic income is a realistic and essential policy whose time has come. It’s a policy you’ll likely hear a lot more about in the next few years. In the decades ahead, our world will see dramatic change due to technology, economic shifts, and a more turbulent natural environment. How we respond to those changes, and whether we decide to trust each other, work together, and build a better world is up to us.
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