Universal Basic Income: An idea that liberals and conservatives are embracing

I am fascinated by the idea of the universal basic income and have been reading up about it.

The Premise:  Provide American citizens a UBI funded by taxpayer dollars. Some supporters say start it at age 21. Some say start it at birth. Most say provide it without regard to income or need. 

The Benefits:

-Eliminate social entitlement programs, including: SNAP, WIC, housing assistance, social security, SSI, earned income tax credit, child tax credit, TANF, unemployment insurance, and others. List of 80 Federal Welfare Programs

-Also get rid of agricultural subsidies and corporate welfare.

-The funds saved from personnel, administration and the dollar outflow would be, let us say, A LOT.

-People could use the funds any way they want: to save for college, save for retirement, as a social safety net, enable parental leave, save for a house, or travel the world.

-More people can feel free to select a career that fits them, rather than a career they don't like but pays a lot. Perhaps this would lead to spending more time with the family.

-Some people may choose not to work, or to work part-time, and devote the rest of their time to a start-up project that they otherwise would not be able to do.

-More and more, full-time jobs do not pay a living wage. UBI could break the cycle of the working poor.

-Many experts predict that a huge chunk of jobs will be going away in the near future. The country cannot survive with so many unemployed people. UBI will help and will enable non-working people to innovate.

-Studies show that giving people extra money makes them feel financially secure. That security ends up leading to empowerment, not de-motivation.

-(I would argue that we keep government funding in three categories: legal services for the poor, FEMA, and health care (Medicare, Medicaid, and Obamacare). No UBI could ever be enough to cover financial catastrophes resulting from legal, weather, and medical emergencies.

Noted Supporters—from the left and the right:

Charles Murray, noted libertarian-  A Guaranteed Income for Every American (WSJ, 6/3/16) - Replacing the welfare state with an annual grant is the best way to cope with a radically changing U.S. jobs market—and to revitalize America’s civic culture. Here's his white paper on it: Guaranteed Income as a Replacement for the Welfare State.

Sam Altman, tech entrepreneur, president of Y Combinator - on a Freakonomics podcast: "Altman argued basic income could support huge amounts of productivity loss and still carry the economy on its shoulders. "Maybe 90% of people will go smoke pot and play video games, but if 10% of the people go create incredible new products and services and new wealth, that's still a huge net-win," Altman says. "And the American puritanical ideal that hard work for its own sake is valuable — period — and that you can't question that, I think that's just wrong."" Y Combinator is starting a UBI pilot project in Oakland, Calif.

Andy Stern, trade unionist, Raising the Floor: How a Universal Basic Income Can Renew Our Economy and Rebuild the American Dream (book coming out 6/14/16)

Tim Worstall, free-market economist with the Adam Smith Institute -- Of Course We Can Afford a Universal Basic Income (Forbes, 6/4/16) "a UBI would be vastly better than the cruel, almost wicked, welfare states that we currently have."

Gwynne Dyer -progressive journalist - Universal Basic Income: Why it is Not Crazy and Not Going Away (CommonDreams.org, 6/6/16)

Tim Berners-Lee, credited with founding the worldwide web-Here's Why the Inventor of the Internet Supports Basic Income (Business Insider, 5/31/16)

Nobel Prize Economists:

Milton Friedman, Angus Deaton, Christopher Pissarides, Joseph Stiglitz, James Mirrlees. 

What do y'all think?

it has merit -- but not sure it will ever pass on such a large scale.  

So, alter the very culture and basic foundation of America?  Sounds awesome.

Without getting into the merits or the actual support by left or right- it fails in the end to serve the most important constituency: those who control the re-distribution of wealth today. 

You're asking bureaucrats and politicians to diminish or abolish the only career likely to grant them an exercise in power. They'll fight you to the death. And whoever you elect to replace them on the promise of implementing will abandon that mission as soon as they're elected. 

To return that power to individuals is anathema to most in government. So much better to keep the poor dependent and angry at their fellow citizens, who are the absolute last people in the room who should share the blame.

While it is in many ways an appealing idea across the spectrum for various reasons (simplicity for the right, the right to income for the left) the numbers really do not work as recently illustrated by The Economist:

"However, universality also means that the policy would be fantastically costly. An economy as rich as America’s could afford to pay citizens a basic income worth about 0,000 a year if it began collecting about as much tax as a share of GDP as Germany (35%, as opposed to the current 26%) and replaced all other welfare programmes (including Social Security, or pensions, but not including health care) with the basic-income payment.

...Yet an income of $10,000 is still extremely low: it would leave many poorer people, such as those who rely on the state pension, worse off than they are now

http://www.economist.com/news/leaders/21699907-proponents-basic-income-underestimate-how-disruptive-it-would-be-basically-flawed

http://www.economist.com/news/briefing/21699910-arguments-state-stipend-payable-all-citizens-are-being-heard-more-widely-sighing

Switzerland just held a public referendum vote on UBI this past Sunday. The proposal was to provide $2,550 (at current exchange rate) per month to adults, regardless of employment, and additional funds for each child. It's the first country to hold such a referendum. It was overwhelmingly rejected, by 77% of the vote.

http://www.bbc.com/news/world-europe-36454060

blueheeler said:

Switzerland just held a public referendum vote on UBI this past Sunday. The proposal was to provide $2,550 (at current exchange rate) per month to adults, regardless of employment, and additional funds for each child. It's the first country to hold such a referendum. It was overwhelmingly rejected, by 77% of the vote.

http://www.bbc.com/news/world-europe-36454060

The Swiss reject most of their referendum votes.  They are a remarkably sensible (yet change resistant) country.   

A lot of pundits say UBI is coming. It's only a matter of time.

UBI Continues to be Wildly Unpopular                                                                                                       But eventually it will become reality. We just have to wait for the robot revolution to evolve to the point where lots of middle-class white people are permanently put out of work. Then it swiftly will go from pet unicorn to "duh." I imagine this transformation will take a surprisingly short time and will happen sometime around 2030 or so.

The proposal lost, 77 percent to 23 percent. But supporters claim that this is just the beginning of a transition as inevitable as the eight-hour day once was and pointed to the following figures from a recent survey of Swiss voters.
-Seven out of 10 (69 percent) voters believe there will be another referendum on basic income in the future.
-62 percent of voters believe basic income is now “on the table” and the debate is just beginning.
-While 31 percent of all voters can imagine basic income being introduced in the future, among young voters between the ages of 18 and 29, 41 percent believe it’s rather likely or definite a basic income will be introduced.

Critics of Universal Basic Income just don’t understand how the policy would actually work                      UBI isn’t really about welfare spending: It’s about tax policy.

shoshannah said:


Nobel Prize Economists:

Milton Friedman, Angus Deaton, Christopher Pissarides, Joseph Stiglitz, James Mirrlees. 

What do y'all think?

I heard Milton Friedman was speechless when this was being discussed

BlueGrass said:

shoshannah said:

Nobel Prize Economists:

Milton Friedman, Angus Deaton, Christopher Pissarides, Joseph Stiglitz, James Mirrlees. 

What do y'all think?

I heard Milton Friedman was speechless when this was being discussed

Um, people have opinions before they die. 

Milton Friedman supported a negative income tax (which we have).

RobB said:

Milton Friedman supported a negative income tax (which we have).

Negative income tax and UBI are kissin' cousins.                                                                                    The Negative Income Tax and Universal Basic Income are Pretty Much the Same Thing

And Nixon was in favor of it:

The Conservative Case for a Guaranteed Basic Income                                                                             The idea isn’t new. As Frum notes, Friederich Hayek endorsed it. In 1962, the libertarian economist Milton Friedman advocated a minimum guaranteed income via a “negative income tax.” In 1967, Martin Luther King Jr. said, “The solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.” Richard Nixon unsuccessfully tried to pass a version of Friedman’s plan a few years later, and his Democratic opponent in the 1972 presidential election, George McGovern, also suggested a guaranteed annual income.

I don't get it.

Neither do I.

we already have a guaranteed income, assuming one gets educated, gets a job and performs enough to not get canned.

Robert_Casotto said:

we already have a guaranteed income, assuming one gets educated, gets a job and performs enough to not get canned.

But only for about a year at most, and then that unemployment insurance runs out and you've got nothing.

I believe UBI will become much more pressing once automation replaces a lot of traditional occupations.  For example, truck drivers may soon see their responsibilities change as discussed in this BBC article.  Warehouses staffed by robots, "lights out" factories and more are already becoming a reality.  

I'm very concerned we'll be too late to the UBI solution to re-balance the economy.  

Robert_Casotto said:

we already have a guaranteed income, assuming one gets educated, gets a job and performs enough to not get canned.

1. No job is guaranteed. Where have you been?

2. Read. The. Articles. It's not 1965 any more. We are heading toward a post-job economy. Step 1 is the current gig economy. 

johnnyr said:

I believe UBI will become much more pressing once automation replaces a lot of traditional occupations.  For example, truck drivers may soon see their responsibilities change as discussed in this BBC article.  Warehouses staffed by robots, "lights out" factories and more are already becoming a reality.  

I'm very concerned we'll be too late to the UBI solution to re-balance the economy.  

I'm not totally convinced that in a post-job world, money for nothing is the solution. Why not just reduce the cost of everything and make the UBI $0?

Because there will always be costs to grow and transport food.  Commodities like oil won't go to $0. 

If it is truly the case that we are moving to a post-job world, I would say that income redistribution is the simplest problem we will have to solve.  

shoshannah said:

Robert_Casotto said:

we already have a guaranteed income, assuming one gets educated, gets a job and performs enough to not get canned.

1. No job is guaranteed. Where have you been?

2. Read. The. Articles. It's not 1965 any more. We are heading toward a post-job economy. Step 1 is the current gig economy. 

How about instead of printing more money to hide inflation we go back on the gold standard so our money is actually worth something.  Once China pegs RMB to gold, we're effed.

Robert_Casotto said:

How about instead of printing more money to hide inflation we go back on the gold standard so our money is actually worth something.  Once China pegs RMB to gold, we're effed.

Uhhhh, what?

The lessons of history, confirmed by the evidence immediately before me, show conclusively that continued dependence upon relief induces a spiritual and moral disintegration fundamentally destructive to the national fiber.

To dole out relief in this way is to administer a narcotic, a subtle destroyer of the human spirit. It is inimical to the dictates of sound policy. It is in violation of the traditions of America.

-Franklin Delano Roosevelt during the 1935 State of the Union

terp said:

The lessons of history, confirmed by the evidence immediately before me, show conclusively that continued dependence upon relief induces a spiritual and moral disintegration fundamentally destructive to the national fiber.

To dole out relief in this way is to administer a narcotic, a subtle destroyer of the human spirit. It is inimical to the dictates of sound policy. It is in violation of the traditions of America.

-Franklin Delano Roosevelt during the 1935 State of the Union

It's a good thing we are a more evidence-based country now. Plus, UBI is not "relief." It's public policy.

We are not more evidence based.  We are a rather ignorant and subservient populace.  We are spoiled and believe in a free lunch.  There's a reason that Bernie Sanders got so much traction and it sure  isn't because people are well informed or evidence based.

terp said:

We are not more evidence based.  We are a rather ignorant and subservient populace.  We are spoiled and believe in a free lunch.  There's a reason that Bernie Sanders got so much traction and it sure  isn't because people are well informed or evidence based.

If you read the links I provided, therein is whatever evidence is available to date. Some pilot programs are being conducted currently, and we will have more data soon.

Thanks for sharing those links, @shoshannah.  It's an interesting concept. I think I'd like to see it running at some small, but significant, scale to have a fully formed opinion on it. I think Finland is also considering trying it? I can see a lot of potential benefits and ways it could fail.

One related concept that we do know works in our country and that I think would be worth expanding is the Earned Income Tax Credit.

but the premise, as stated in the first post, is to do away with that credit, among other programs.  

As I said, a post-job economy is heading our way.

As Low-Skilled Jobs Disappear, Men Drop Out of the Workforce