Pugsley’s Guide to: Universal Basic Income
Universal Basic Income has exploded on the cultural and political scene as of late. Alexandria Ocasio-Cortez, a progressive US Democrat who just ousted an established competitor from running for Congress in New York, has urged us to explore Universal Basic Income, which, she reminds us, was proposed in 1940 by the Democratic President of the United States, Franklin D. Roosevelt.
What is Universal Basic Income?
Universal Basic Income (UBI) is “a guaranteed income paid by the government to every person within a political community, regardless of whether they are working” (thanks Max Harris). It aims to provide a stable income for everyone in that community, who would know they were getting a set sum of money every week/month/year, depending on the particular program.
Why Are We Interested Now?
The rise of artificial intelligence will likely make many jobs redundant. UBI has been posited as a way to provide a means of subsistence when there is less economic need for human labour, or for those who are between jobs, navigating the rapidly changing economic landscape. Equally, despite huge technological advances and economic capacities in the recent past, much of the world still lives in poverty. Even in developed nations, poverty is still rife. In the UK, around 20% of people live in poverty today, whereas in the USA, the number was 13.9% in 2016. UBI might be a good way of reducing poverty levels by ensuring everyone has a basic level of income above those levels.
Where Is It Happening?
As you can see from this handy image from UBI advocate Scott Santens, there have been a number of successful UBI pilot programs around the world, with more planned.
The state of Alaska’s Permanent Fund (AFP), created in 1976, is the only thing like a genuine UBI in existence today. Funded by oil revenues, AFP provides yearly dividends to permanent residents of the state ($1,022 in 2016, $2,072 in 2015, $1,884 in 2014). While it doesn’t quite satisfy the ‘basic’ requirement of ‘universal basic income’ (the amounts wouldn’t cover basic living costs), it certainly provides these Americans with a little extra cash to help them along, and pulls them out of $2-a-day poverty.
Finland also tested a guaranteed basic income during 2017 and 2018. During the experiment, a total of 2,000 unemployed persons between 25 and 58 years of age received a monthly payment of €560, unconditionally and without means testing. While the recipients fared no better than the control group on finding employment (at least within the first year of the experiment), they did report higher levels of wellbeing, less stress, and fewer health problems than the control group.
The Pros of UBI
The pros of UBI are numerous and reportedly include:
new mothers extend maternity leave
increase in home ownership
students focus on school, grades improve
more fresh fruits and vegetables are consumed
improvement in conscientiousness and agreeableness
decline in hospitalization rates
Cons of UBI?
UBI opponents say it provides a disincentive to work, it redistributes wealth away from the poor and towards the better-off, and it’s too expensive. Even UBI supporters are cautious about the lack of evidence about its impacts, and about the nature and scope of UBI. Would it be offered to all residents of a country, anyone within the country, or to citizens only? How does it interact with and impact existing welfare benefits? Even with pilot schemes being run in a number of countries, it’s hard to know whether UBI would play out the positive or negative projections, leaving us to speculate according to our views on human nature and the economy.
Pugsley’s Paw Rating
Pugsley gives UBI 3 ½ Paws. UBI seems a good response to fluctuations in technology and labour markets. It also seems like it might help people to stay afloat financially, and might give people the base support they need to pursue a creative career they are really suited to, rather than be forced into the 9-5 grind. Pugsley wishes he knew more about the impacts of UBI, in which case he might be moved to give it a full 4 paws!