Is There a Need For a Universal Basic Income?

Have you heard about the concept of a universal basic income? A universal basic income (UBI) is when the government gives everyone a cash payment regardless of their assets or even whether they work or not. It’s a pretty radical idea, but we seem to be hearing more about the universal basic income from entrepreneurs, politicians and the media lately. Why is it suddenly on the agenda? In recent years there has been a lot of talk about artificial intelligence and robots. There is speculation that many jobs could disappear with the eminent arrival of these new super robots. People are asking how they are going to survive if their job disappears.

My philosophy has always been that if you have a can-do attitude, you keep learning and upskilling, and you persevere then you will succeed in this world, regardless of the obstacles you encounter. However that does not mean I’m unwilling to explore this idea of a universal basic income. In the last French presidential election two left-wing candidates argued that every French citizen over 18 years should receive a monthly payment regardless of whether or not they worked.

Friedman was the first UBI supporter

The Nobel Prize-winning US economist Milton Friedman was the first major economists to support a universal basic income or as he called it a ‘negative income tax’. Do you know much about economics? A survey of economists (the Economic Professors Favourite Thinkers) ranked Milton Friedman as the second-most popular economist of the twentieth century after John Keynes. Keynes came up with the theory of Keynesian economics. Basically he believes in a free market economy, but during recessions and depressions he thinks the government should intervene and increase spending on public works and services, and stimulate the economy. This is essentially economic expansion. Most developed nations adopted Keynesian economics during the late part of the Great Depression and after World War II.

Friedman actually opposed Keynesianism and came up with an alternative system known as ‘monetarism’. He said that instead of increasing spending on capital works and other government services, the government should instead expand its money supply (the money in circulation). Friedman was an advisor to President Ronald Reagan and British Prime Minister Margaret Thatcher. Friedman also hated seeing people in poverty and so supported the idea of negative income tax or cash payments to those in need. “The arrangement that recommends itself on purely mechanical grounds is a negative income tax,” Friedman wrote. “The advantages of this arrangement are clear. It is directed specifically at the problem of poverty. It gives help in the form most useful to the individual, namely, cash.”

Is UBI a handout or social justice?

Do not get me wrong, I am not in favour of giving people hand-outs for nothing, but I am open to a philosophical conversation on what our world will look like with the rise of artificial intelligence and super robots – is there a need for a universal basic income?

Some people say this New World Order is the perfect chance to remake our society and a universal basic income would guarantee economic security, fairer wealth distribution, justice, poverty eradication and gender equality. Other people argue that the universal basic income is just another name for communism, and hey, it didn’t work the first time round in Russia and China! But the UBI has some powerful backers. Stanford University Professor James Ferguson calls it a ‘right share’, and says money should be distributed fairly with other social services like health, education, housing and disability support.

Would a UBI discourage work?

But would a UBI discourage people from working? Would it lead to a whole new generation of dole bludgers? It troubles me when I hear full-time jobs are disappearing and some young people might NEVER have a permanent full-time job. Supporters of the UBI argue that it would be good for women who stay at home and raise children, artists who are not rewarded for their creativity and even Aboriginal people who have stayed on their land to care for the country.

Zuckerberg backs the UBI

Would you believe Facebook founder Mark Zuckerberg is a supporter of a universal basic income? Addressing Harvard University recently he said, “We should explore ideas like universal basic income to make sure that everyone has a cushion to try new ideas.” The UBI has a lot of supporters in Silicon Valley. That makes sense to me. Silicon Valley is at the forefront of artificial intelligence. Silicon Valley is designing these robots that are meant to take jobs away, so perhaps these high-tech geniuses want to allay job anxieties by promising a universal basic income for all.

But critics say the UBI doesn’t address the real issues behind poverty, such as poor education, a lack of skills and low global wage growth. “UBI is a misguided mission,” says Lawrence Mishel, president of the Economic Policy Institute. “It’s a tech CEO view of the world that I think is distorted.”

Some countries are already trying it

Some countries are already toying with a UBI. Finland is giving nearly $600 a month to 2,000 citizens. The citizens must have been receiving unemployment benefits or an income subsidy. It’s a two-year experiment that could be expanded nationwide depending on the results. Ontario, in Canada, has a program providing 4,000 citizens with an unconditional income of about $12,600 a year. Applicants must be between ages 18 and 64 and living on a limited income.

However some countries are opposed to a UBI. In 2016 the majority of Swiss voters rejected a referendum that would have seen every citizen a guaranteed income of 2,500 Swiss francs a month after tax, regardless of their employment status or wealth. About 77% of Swiss voters opposed the UBI.

What are your thoughts on the UBI? My thoughts are that if you are strong enough and determined enough, you will succeed and prosper in this world regardless of the challenges, however I also accept that not everyone has my drive or know-how. No one deserves to live in poverty, but at the same time people need incentives to work – providing of course there is work out there.