The idea of universal basic income is not new; the theory’s been around for decades. Small-scale distributions have been explored in Canada and India. Finland recently provided a basic income of $687 per month to 2,000 unemployed people for two years. The city of Stockton, California gave $500 per month to a hundred residents for eighteen months. The results of these experiments are easily applauded or denounced depending upon one’s politics, but realistically these trials are so miniscule they cannot tap the true potential of providing folks with a universal basic income for an open-ended period of time.
If everyone—everyone—received a basic minimum income simply for being a citizen of this country, the effects would be transformational. From a liberal perspective, we could provide fiscal security for all citizens. From a conservative perspective, we could dismantle much of the welfare state. From an individual perspective, we could value people for our inherent qualities rather than our economic potential.
At the extreme, universal basic income eliminates social programs. No more food stamps, goodbye TANF, farewell unemployment compensation, adios Section 8 housing vouchers. When we give people actual cash, we give them agency, lift their self-respect, and eliminate social service bureaucracy. Universal basic income unchains us from our jobs. We can take an extended leave to pursue a personal project, or just sit at home. So long as one is copasetic with a very modest standard of living, economic participation is optional. As a matter of equity, even rich people would receive a universal basic income, although the extra money ninetieth percentilers receive would likely be offset by revised taxes to fund distributions.
So why would anybody work? Because many of us enjoy our work, and most of us want more than a basic standard of income. Nonetheless, the nature of work would change. It will become more difficult to find people to perform low echelon tasks. Automation will boom. We won’t worry about robots eliminating our jobs; we’ll welcome them. It will be more difficult to find guys willing to pick up our trash, but I’m confident there’ll still be folks keen to design and build automated trash-picking systems.
The nature of our cities, our development patterns, will change as well. A single person will not be able to live in a high-priced city like San Francisco or Boston on universal basic income. People who opt out of the economic system will either live differently by pooling their basic incomes, or they will move to less expensive areas of the country. Much like developments in Arizona and Florida today cater to retired people, I anticipate that individuals who want to live solely on universal basic income will relocate to inexpensive places. Non-economic communities might thrive in low cost states like South Carolina and Kansas. This is really not so different from existing welfare pockets in Arkansas and Appalachia, although preferable for being explicit and shameless.
To be sure, universal basic income will not function as purely as described above. Some people—developmentally disabled, addicts, mentally ill—will not survive on a modest direct payment, either due to exorbitant maintenance costs or inability to make reasoned choices. The libertarian in me says, give everyone enough and give him the right to blow it as well. Realistically, we will still need some additional safety net, though beyond a direct payment for every individual, that net ought to be pretty shallow.
What would all this cost? Let’s suppose every adult gets $800 per month, and every woman’s first two children get $400 per month (nothing for additional children in our overpopulated world). That’s an annual income of $28,800 for a family of four (Eureka! We’ve already extinguished the current welfare conundrum that penalizes a woman with children from ‘acknowledging’ fathers and partners). The United States has about 75 million children (0-18) and 200 million adults (18-64). Total cost: about $2.4 trillion dollars per year. That’s 12% of our current $19.4 trillion economy. When we factor in the end of existing transfer payments, etc. that total will shrink. For ten, maybe twelve percent of our total economy, every person can enjoy a threshold income. We can afford to do this.
Since the invention of the loom and the plough, a person’s value has been judged by how much they contribute to our economic system. But our economic system is both antiquated and broken. A system that values a boss at a hundred times more than a laborer is unfair; a system that values a professional baseball player at a thousand times more than a farm worker is unjust; a system that values a money-shifting suit at a million times more than a guy who actually makes something is unethical. We have the resources, affluence, and technology to free us from the system. Let’s start by recognizing that if you’re here, you matter, regardless of how successfully you navigate our stilted form of capitalism.
However, the reason for providing universal basic income transcends economics. It’s an important step toward truly free enterprise: a world in which everyone is free to engage in the enterprise that sparks his or her passion.
Once we all receive enough money to maintain a modest living, participating in our economic system will be a matter of choice, not necessity. Our economy will operate more efficiently; our personal lives will be enriched even more.